Guest Contribution: “What Will the Trump Presidency Look Like?”

Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared on November 9th in Project Syndicate.

We unexpectedly find ourselves in uncharted territory, in so many ways. The United States has never before had a president with no political or military experience. And Donald Trump is especially unpredictable: he has so often said things that conflict with other things he has said. So it is hard to know what he will do.

But a possible precedent for what the Trump presidency may look like sits in plain sight: the George W. Bush presidency. To be fair, the Bush family clearly did not support Trump’s campaign. But a number of parallels suggest themselves:

  • The candidate won the presidency while losing the popular vote.
  • The new president nonetheless believes he has a mandate for sweeping change.
  • The direction of the change and the results it produces will not necessarily be what those who “voted for change” will like.
  • Observers are assuming that Mr. Trump will oppose the Fed’s easy monetary policy, because he attacked it during the campaign; but I predict that when he gets into office he will turn dovish, opposing interest rate increases.
  • Of his economic policy proposals, the ones that are most likely to be put into law are big tax cuts for the rich and increased spending on the military and on some other items. The result will probably be the same as when Bush enacted similar fiscal policies: a worsening of the income distribution and huge budget deficits.
  • A Trump return to the post-1980 trend of increasing income inequality would follow a temporary reversal of that trend that occurred toward the end of the Obama Administration (by such measures as median family income, real wages, and the poverty rate). This is the same thing that happened in the transition from the Clinton Administration to Bush.
  • The new president won’t be able to deliver his 4% GDP growth rate.
  • He is unlikely to be able to increase the role of exports in the economy.
  • He certainly won’t be able to make good on his promise to bring back the manufacturing jobs that have disappeared since the 1950s.
  • Most worrisome of all are possible foreign policy disasters. We should fear miscalculations leading to tragedies (analogous to Bush mistakes regarding the 9/11/2001 terrorist attack, the failure to apprehend Osama bin Laden, and the subsequent invasion of Iraq). A loss of US global leadership is likely, especially loss of “soft power,” in the sense that those who live in other countries have in the past looked to the United States as a leader of the international order and as a model domestically of what they hope their own countries could be like. Finally, Trump’s cluelessness on the international stage will likely embolden some traditional adversaries, such as Russia, Syria, and North Korea.

If I had to guess, we are not likely to see some of the more outrageous proposals from Mr. Trump’s campaign enacted.

  • He will not build a big beautiful new wall along the length of the border, and Mexico certainly wouldn’t pay for it if he did.
  • We won’t see a ban on Muslim immigrants, which would violate longstanding bedrock American principles.
  • We won’t see deportation of eleven million undocumented immigrants. But he will likely end Obama’s Deferred Action for Childhood Arrivals program, which granted temporary work permits to many “dreamers.”
  • My best guess is that he won’t in fact tear up NAFTA or raise tariffs as widely as he has said. I hope this is not just wishful thinking.
  • Similarly, I don’t think he will tear up NATO or our other alliances, as he seemed at times during the campaign to suggest. Nor the Geneva Convention. Even Mr. Trump has to confront at some point how drastic would be the consequences or this sort of destruction of the global order.

But it is likely that he and the Republican Congress will, as he promised, take some steps to roll back the biggest accomplishments of the first part of the Obama Administration. Number one is a rolling back of Obamacare (going beyond the damage that Republicans have done since the beginning by chipping away at the legislation). It will be interesting to see people’s political reaction when they start losing their health insurance.

Number two is a rolling back of Dodd-Frank financial regulation, which was enacted after the financial crisis of 2007-09. The Republicans will give banks and other financial institutions a freer hand.

They will also roll back competition policy and environmental regulation, especially regarding emissions of greenhouse gases.

And of course they will seek to appoint conservative justices to the Supreme Court. Logically, the Democrats could try to block such appointments in the same way that the Republicans in Congress refused to hold hearings on Barack Obama’s nominee for the Court (and otherwise blocked almost everything that the President tried to do). But they probably won’t.

We are about to see what life is like when the Republicans hold all branches of government. It will be interesting to see if working Americans will blame them for setbacks.

This post written by Jeffrey Frankel.

17 thoughts on “Guest Contribution: “What Will the Trump Presidency Look Like?”

  1. Rick Stryker

    Yes, events are making it much more clear that Trump’s more outrageous proposals are not going to happen. But that is no surprise to conservatives who backed Trump. Back in May, Menzie was having a fit that Trump was going to forcibly remove all undocumented immigrants as well as ban all Muslim’s from entering the country. In one of my comments, I laid out the case for conservatives to support Trump, as I had decided to do. I pointed out that Trump could in fact win with his strategy in the rust belt states and that he wouldn’t be hurt by the lack of Hispanic and women votes as much as people thought, contrary to what pundits on both sides were thinking. I pointed out that the deportation threat wasn’t serious, nor would there be a religious litmus test for people entering the country. I predicted that the wall would likely be a revival of the secure fence act of 2006. (Trump has already said some sections of the wall can be a fence.) I predicted that Obamacare will be history, climate change policy will be rolled back, and Trump won’t abandon NATO. I also suggested that some prominent economists, when they see they reality, will start to attempt to influence the Trump Administration. We already saw Martin Feldstein do that today in the WSJ. I think the same will happen on foreign policy.

    It’s good to see Jeff take a more reasonable view of what’s likely to happen on trade. But I would just remind him that I suggested this very view in September in my comment to his post on Trump’s trade policy. Jeff replied to my comment saying, “As should be evident, Donald Trump is by the far the most anti-trade of major American presidential candidates going back — at least — to Herbert Hoover.” In my reply, I suggested that Trump’s statements should be understood as campaign political statements that were no different from what Obama said in 2008. I do think Trump means them more and will likely act on them in some way, unlike Obama. But there never was any evidence that Trump was planning to start a trade war.

    Here’s another prediction for you. Many of those angry kids who are marching against Trump in cities all over the country, saying “he’s not my president,” are going to enthusiastically support him in 2020.

    1. baffling

      i love how the party of social conservative and traditional values has embraced the idea of lying as a winning strategy. or as colbert use to say, truthiness.

      but as the sign in the store says, you break it, you buy it.

    2. Gridlock

      I really appreciate the way ‘fiscally conservative’ Republicans are SOOOOO against deficit spending until their party ends up with their hand on all of the controls. Just like Reagan, we will see a tax-cut and spend four years. While those ‘tremendous’ deficits might goose GDP for awhile, I don’t see how increased military spending is anything different than ‘digging holes’. In the meantime, prepare for every social safety net to be cut, slashed and gutted.
      I predict that President Trump won’t see term 2 unless he is able to get us into a ‘rally around the flag’ war. Probably with Iran. Cheers!

  2. AS

    Regarding Trump’s election, here are a couple comments and a possible teaching moment (in addition to your above comments) for those of us who are not bitter partisans.
    1. If President-elect Trump is a disaster for the country, he will be gone in four years and prior to his defeat in four years, there is a good chance that Democrats will be successful in the mid-term elections and will be more successful in the next presidential election. Republicans may not win a majority for many years if Trump is a disaster. The “rust belt” states that supported Trump this time (because the voters felt neglected), but supported Obama in the last election will switch back to Democrat candidates.
    2. Regarding income inequality, how much of income equality is due to allowing excessive number of illegal immigrants, from both sides of the border and from overstaying visas? I assume that many illegal immigrants arrive with minimal education and minimal assets.
    3. How do you react to Martin Feldstein’s comments in the Tuesday, November 15, 2016 WSJ? He seems to think that if corporations bring-back overseas cash there could be an investment in plant equipment leading to increased productivity. Given that we may be at full-employment, increasing productivity would seemingly be very welcome.

    1. Rick Stryker


      No one answered your good questions, so I’ll take a stab:

      1) I think you are right that Trump cannot not exaggerate his mandate, given that he barely won. Obama made that mistake in 2009 as did Clinton in 1992-94. Both suffered during the midterms. Obamacare is particularly tricky. It won’t be as simple as repeal and replace. They will probably have to prop up Obamacare temporarily to avoid people being tossed off their health insurance. And they’d be wise to get bi-partisan support for Obamacare’s replacement.

      2) George Borjas at Harvard has done the best work on your question. I believe the answer is that immigration has had some depressing effect on US workers at the lower end of the wage spectrum. But by and large immigration is not that important for income inequality overall.

      3) I thought Feldstein did a nice job showing how Trump’s policies could be implemented in a positive way. The big question is who the Administration will appoint to the economics positions. If they get some legitimate people to sign up, it will be fine. I would think they might convince Glenn Hubbard to join. But there is cause for concern too. I don’t know if you’ve seen the documentary Generation Zero, which was written, directed, and produced by Stephen Bannon, who is Trump’s main advisor, and Citizen’s United. The documentary features many of the same people who are close to Trump now. The documentary is filled with misunderstanding of the financial crisis and economic fallacies on international trade. If you’ve followed my comments, you’ll know that I don’t think we should exaggerate this–both Bush and Obama have used protectionism too. But Trump will probably go farther. We’ll see–his appointments will clarify the situation.

      1. AS

        Thanks for the reply. I thought I had made an Impolite noise in church. I always appreciate your comments and other objective “non-snark” comments.

  3. Lord

    There will be some changes as there would have been even if he lost and these are a reasonable expectation, but the greatest change will be in spin. Everything will now be right in the world as the right laud on every minor success as vindication and believe it. In our new utopia little will need to change and little will. Trump himself has prepared the way by having so little concrete proposed.

  4. 2slugbaits

    Rick Stryker I think you’re patting yourself on the back a little too much. It’s doubtful that your prediction of a Trump win would have come to pass if Comey hadn’t been snookered by some rogue pro-Trump FBI agents. Trump won WI and PA (and apparently MI) by very thin margins. And exit polls showed that he got those razor thin margins from low information voters that went for Trump after Comey put out his much-ado-about-nothing announcement.

    But the gist of your point is that Trump was successful because, like the used car salesman that he is, he hoodwinked people into buying the lemon and taking it off the lot. Guess what? Sawdust in the differential. Honey in the oil pan. Flax in the radiator. Bondo on the fenders. And then we should all wonder why people are cynical about politicians.

    You should also worry about his Cabinet members and regulatory heads. Rudy “9/11” Giuliani is a crazy man and has no business at State. Of course, the NY AG is sitting on a criminal indictment against him after the FBI finishes their investigation, so may Rudy won’t be around too long. And then there’s the Newtster. And don’t forget John Bolton, who may compete with Donald Luskin for the “stupidest man alive” award. OTOH, I don’t think Bolton has gone through enough divorces to be part of the Trump Family Values coalition.

    1. Rick Stryker


      You have missed my point. I was not trying to pat myself on the back but rather pointing out that so many people on the Left missed the Trump phenomenon because they live in their own echo chamber. If they had listened to some conservatives and taken them seriously, they would not have gotten it so wrong.

      I understand that many readers of the NYT feel that they were not adequately informed, which is what I think prompted the extraordinary letter from the publisher to his readers vowing to do better next time. But the NYT isn’t doing any better because it doesn’t understand the problem: they only have one point of view at the paper. They have no conflicting voices that challenge their underlying leftist assumptions or look at the world outside the lens of the east coast elitist bubble.

      One of the funniest examples was Paul Krugman’s epic beclowning of himself and his paper on election night. As one of the NYT “experts,” Krugman was asked to give his opinion on the implications of Trump’s election on the economy. Here’s what he said:

      “It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover?”

      Frankly, I find it hard to care much, even though this is my specialty. The disaster for America and the world has so many aspects that the economic ramifications are way down my list of things to fear.

      Still, I guess people want an answer: If the question is when markets will recover, a first-pass answer is never.”

      Never? Never! How could the editors at the NYT allow Krugman to write something like that? I’ll tell you–they believed it too.

      Krugman went on:

      “So we are very probably looking at a global recession, with no end in sight.”

      Yes, it’s a recession we’ll never recover from, and that’s why the market will never recover. Why, Trump’s election is the worst economic calamity to happen since the 1000-year downturn during the dark ages.

      Krugman watched his forecast contradicted for two full days beforehe backtracked, saying:

      “There’s a temptation to predict immediate economic or foreign-policy collapse; I gave in to that temptation Tuesday night, but quickly realized that I was making the same mistake as the opponents of Brexit (which I got right). So I am retracting that call, right now.”

      Thus, spaketh the NYT economic expert. Have the NYT readers been well-served by that? No, and it won’t get any better. No one at the NYT or in the leftist econsphere has learned anything from what happened. 2slugs, neither have you.

      Comey is not the reason Hillary lost. Comey is the reason that she almost won, since he and the Justice Dept covered for her on the email scandal. Hillary should have been indicted and thus not the Democratic Party candidate. You and her supporters in the echo chamber convinced yourselves otherwise, but the voters knew it. Many Sanders voters knew it and stayed home.

      One prediction the Left did get right is that the losers would not accept the outcome and violence would break out against the winners. But they didn’t realize that they were talking about themselves. You have Democrats protesting, saying that Trump is not their President, something like 40% of Dems think the election was illegitimate, and you have Dems harassing electors by calling and emailing them to induce them to break the laws of their state and vote for Hillary Clinton. They justify these actions based on the popular vote, despite what the the 12th amendment says. There are videos of Clinton supporters attacking Trump supporters in the streets violently, but your echo chamber media at the NYT and WaPo won’t show that to you.

      The Left can’t see its own flaws. That’s why Republicans now have 3 branches of government and are one state legislature away from being able to amend the constitution.

      1. 2slugbaits

        Rick Stryker When people say that Trump is not legitimate, they don’t usually mean that he isn’t legally and constitutionally legitimate. We all learned about the Electoral College back in middle school. People usually mean that the Electoral College itself is inconsistent with political legitimacy. As I said before, Erich Honecker was the legal and constitutionally legitimate head of the old GDR. I don’t think anyone would want to argue that he was politically legitimate. The fact is that Clinton will end up with well over 2 million more popular votes than Trump. That’s important. It’s also the case that more people will have voted for Democratic candidates in House races than Republican candidates, yet the GOP will control the House. There is a limit to how much gerrymandering a democratic society can tolerate before its political leaders lose legitimacy. This is the second time in sixteen years that the Electoral College has failed us. And the GOP has lost the total number of popular votes for the House several elections in a row. Clinton lost because a few precincts in two states went for Trump. And the exit polls I saw said that something like 70 percent of those voters made up their minds after Comey announced he was re-opening the investigation.

        As to living in an echo chamber, well…I actually do listen to Rush quite often…at least as much as I can stand. And Fox News is almost unavoidable on military bases. I have three sisters who are ardent wildly right wingers…two of them alone have (at last count) 163 firearms in their homes. I hardly live in an echo chamber. I think you’re the one who is living in an echo chamber. It won’t be long before you try and convince us that Trump voters want to see a more powerful financial sector, cut backs in healthcare, privatized Medicare, privatized Social Security, and tax cuts for the top 1%. And you know what? After big money gives all those things a fancy name and lies about what’s inside those proposals, the GOP just might be able to fool the same low information voters that voted for Trump. I’ve never believed that voters have a clue. Half have an IQ under 100. Voters are nitwits. So I don’t doubt that those same voters can be persuaded to vote against their own interests. Kansas is a perfect example.

        You are quite right about the state legislatures. Big money GOP donors invested heavily in down ballot races. The GOP has always done well at the state level. That’s partly because gubernatorial races tend to be held in off years when older, conservative voters come out in larger numbers. It’s also because states represent territory and not people. When you look at a map there’s a lot of red area, but not so much red when you look at population. If you’re looking for Constitutional amendments, how about starting with one that abolishes the states?

      2. baffling

        “Comey is not the reason Hillary lost. Comey is the reason that she almost won, since he and the Justice Dept covered for her on the email scandal. ”

        complete misrepresentation of the situation. the clinton case was found lacking-and that is why it was dropped. comey simply caved into the republican and trump pressure at the end of the campaign. while i do not believe comey intended for his actions to affect the outcome, it was very poor and unprecedented lack of judgement on his part that significantly impacted the outcome of this election. writing an ambiguous letter and remaining silent for a week was simply a failure in judgement-particularly when the trump camp was permitted to “interpret” that letter and silence in a detrimental and very partisan manner. trump may have won the electoral college, but please don’t try to rewrite the historical impact of the fbi in this election. comey most definitely aided the election of trump.

  5. Paul Mathis

    Dodd-Frank and Obamacare aren’t going anywhere.

    Trump doesn’t owe the big banks any favors and there is nothing they can do for him now. He is a quid pro quo guy and the banks have screwed him many times before.

    Trump promised to replace Obamacare with a “great” plan. There is no “great” replacement plan except Medicare for all. He is not going to throw all his supporters, who depend on Obamacare, to the wolves. He doesn’t owe the medical industry any favors.

    1. Gridlock

      I don’t know who is more delusional. Paul Mathis or Rick Stryker. Prepare for a re-telling of Reagan’s Tax Cut and Military Spending Deficit-splosion Spectacular!
      Of course, the alt-right nabobs will nuke Obamacare and then go after the rest of the social safety net. Homelessness will be back where it was when Comic Relief first brought it to everyone’s attention, only we won’t have Robin Williams helping out.
      Trump won’t see a second term unless his ‘rally around the flag’ war against Iran is in full swing by Spring of 2020. Buckle up.

      1. Paul Mathis

        Trump has already said he won’t change SS or Medicare and Obamacare must be replaced with a “great” plan. The Paul Ryan faction wants to kill all three, but Ryan is nobody to Trump.

        Thanks for your doomsday scenario, however. Paranoia strikes deep.

  6. Bruce Hall

    I ran across an interesting article that sets out the economic and social thinking of Steve Bannon who has been named as Trump’s chief strategist. There are many so-called experts about Bannon, but this is really the most in-depth statement of positions by Bannon himself. It is a couple years old, but I was surprised by what I read, especially his view of capitalism. The new “alt-right” may have some aspects of the “progressive left”, but for different reasons. Bannon is obviously not a progressive since progressives view government and globalization as the drivers of human progress and morality. Bannon is unabashedly a conservative Christian, but not in the sense that progressives use that term.

    Read that in the context of the larger setting for his comments.

  7. In Hell's Kitchen (NYC)

    Even if Trump fails the well-crafted Republican echo-chamber will again, successfully, blame the Democrats.

    We’ve seen it with the Clinton administration (whose success was rebranded, by said echo-chamber, a failure) and with the Obama administration (whose successful reversal of all the negative trends gifted to the country by the GWB administration and the subsequent growth was, again successfully, rebranded a failure by the echo-chamber).

    I’m afraid that we’ll have to wait until demographics make gerrymandering and other right-wing tricks to suppress the vote in key areas unable to save the republican con artists from defeat at the polls. I think Trumpism will be with us for 20-30 years more and we’ll be lucky to have a country to be saved when its time has passed.

  8. 2slugbaits

    Thanks for the Bannon link. The man is even crazier and more paranoid than I thought. He also doesn’t know a damn thing about pre-World War I diplomatic history. He must have spent too much time watching first season “Downton Abbey” reruns. Apparently he never heard of the Balkan Wars. Or the Russo-Japanese War. Or the various proxy wars in Africa. Or imperial Russia’s pre-war involvements around the Bosphorous. Or the Dreadnought race.

    You have to wonder why anyone who claims to represent conservative Judeo-Christian values would align himself with Mr. Donald “Who’s My Current Wife?” Trump. You have to wonder why anyone who claims to oppose crony capitalism would support the patron saint of crony capitalism. Bannon perfectly captures the cognitive dissonance that describes so many on the alt-right and Tea Party. He’s a mess.

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