2024-07-30 04:59:21
Donald Trump seems to have some clear ideas about the U.S. economy, in case he wins the upcoming elections in November. The words spoken about this by the Republican candidate have raised fears of trade wars and geopolitical chaos. On the other hand, there are those who are excited about his “America First” policies, which would bring jobs back to the United States.
Trump’s first term in the White House yielded mixed results regarding the economy. However, many voters claim to trust his financial management more than that of the Democrats.
The current president, Joe Biden, has failed to sell his ideas to the American people. The results of a survey conducted in mid-July by The Economist and YouGov show that 51 percent of citizens disapprove of Biden’s management of employment and the economy. Fifty-eight percent do not like how he is handling inflation and prices, and 54 percent of respondents believe the economy is getting worse overall.
More of the same from the Republicans?
Currently, inflation and rising prices pose a serious problem for ordinary people. In that same survey, 25 percent of respondents stated that inflation and prices are the most important issues at the moment, far above immigration, employment, and the economy.
During his 90-minute acceptance speech at the Republican National Convention on July 18, Trump shared his vision for the country: “We will restore the republic and usher in the rich and wonderful tomorrow that people so deserve,” he announced. “The future of the United States will be bigger, better, bolder, brighter, happier, stronger, freer, greater, and more united than ever.”
Overall, most of Trump’s economic ideas do not differ much from those of his first term. The Republican candidate is obligated to maintain a tough stance, tariffs, and tax cuts, with the difference that he now has more experience and determination.
“Trump faced many obstacles in his first term, blockades that he is determined to eliminate immediately,” highlights Dan Mallinson, associate professor of Public Policy and Administration at Pennsylvania State University in Harrisburg. The choice of J. D. Vance as running mate is another clear message to businesses. Vance, who once worked in the venture capital sector, is critical of immigration and big corporations. He has called for the dissolution of tech giants and wants to focus on domestic manufacturing and industry.
High tariffs on non-American products
For Trump, the way to boost U.S. manufacturing is to impose tariffs. Among other things, he has suggested a general tariff of 10 percent on all imports to the U.S. and an extraordinarily aggressive tariff of 60 percent on all goods from China.
In response, other countries would likely impose tariffs to counteract them, which could lead to another situation similar to a trade war.
Deporting more working immigrants
Trump cannot govern alone and has the backing of Republicans and their GOP Platform 2024, a 16-page document that outlines the party’s intentions. The text, published a week before the Republican National Convention in Milwaukee, is sparse on details. It advocates ideas typical of the “America First” slogan, such as reducing regulations, bringing manufacturing back to the U.S., and deregulating the energy sector.
Moreover, it mentions sealing the border with Mexico to stop illegal immigration and “carrying out the largest deportation operation in U.S. history.” It may seem that closing borders and deportations have little to do with the economy, but they are measures that would have far-reaching consequences. In addition to creating a humanitarian crisis, deporting millions of immigrants would make it even harder to find workers in a country facing a significant labor shortage. At the same time, Republicans want to introduce policies for “buying and hiring American products,” which would prohibit companies that outsource jobs from doing business with the U.S. government.
Other Republican economic ideas
Trump and the Republicans also want to make the tax cuts from 2017 permanent and exempt tips for restaurant and hospitality workers from income tax. Experts say that all these tax cuts, along with the proposed tariffs and deportations, could worsen the deficit, push wages up, and increase inflation.
“While he talks a lot about inflation, it is not clear that his economic policies are capable of addressing it,” says Dan Mallinson.
While Trump has been clear about what he wants, Kamala Harris still has to lay out her economic vision. However, from what we have seen, she is likely to maintain many of Biden’s economic plans, whom she has supported as vice president.
She is expected to continue advocating for workers’ rights, the production of renewable energy, and the return of the manufacturing of strategic technical products, such as semiconductors, to the U.S. Global trade will remain important, but it is likely that some import tariffs will continue.
At this moment, the economy seems fairly strong, but, according to Dan Mallinson, “the Democrats do not benefit from it.” “This is largely due to pocketbook voting. Voters tend to think about how their wallet is doing, not how well the economy might be doing overall.”
(ms/cp)
Future Economic Trends Driven by Trump’s Policies
As the political landscape shifts towards the upcoming elections, Donald Trump’s economic vision appears to be drawing both support and concern. His “America First” approach, if implemented, could lead to significant changes in the U.S. economy, especially regarding trade, immigration, and fiscal policies.
Trade and Tariffs: A New Era of Protectionism
Trump’s aggressive stance on tariffs, including proposals for a broad 10% tariff on all imports and a staggering 60% on Chinese goods, suggests a potential return to a more protectionist trade environment. This escalation could provoke retaliatory measures from other nations, potentially leading to a full-blown trade war. Such a scenario might disrupt global supply chains, making American products more expensive abroad and impacting inflation rates domestically.
Immigration Policies Impacting Labor Supply
Another cornerstone of Trump’s platform is stricter immigration control, emphasizing deportation and border security as mechanisms to protect American jobs. While this approach garners support from certain voter segments, it also raises concerns about exacerbating the existing labor shortage in various sectors. As businesses grapple with worker shortages, the potential mass deportation of immigrants could further strain the labor market, impacting economic growth.
Tax Cuts and Fiscal Responsibility
Trump’s proposed extension of the 2017 tax cuts aims to bolster consumer spending and spur economic activity, yet it comes with risks. Experts warn that these tax cuts, combined with tariffs and proposed deportations, could worsen the federal deficit and inflation, complicating the economic landscape. While appealing for short-term growth, such policies may create long-term financial challenges that both parties will have to address.
Continued Focus on Domestic Production
At the core of Trump’s economic strategy is a renewed focus on domestic manufacturing and industry. This includes fostering an environment conducive to U.S. companies by reducing regulations and emphasizing “buy American” policies. The effectiveness of these strategies will depend heavily on how they balance competitiveness with global markets and whether they successfully attract and retain domestic investment.
Overall, the potential ramifications of Trump’s policies could lead to a transformative period for the U.S. economy, marked by increased protectionism, labor market challenges, and an uncertain fiscal future. With the electorate’s sentiment heavily influenced by economic conditions, navigating these complexities will be critical for both Trump and his opponents in the upcoming elections.
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