Trump’s radical policy bonfire will burn for at least a generation
Rising from the ashes of his 2020 defeat, the ignominy of the Capitol Building riot and two assassination attempts, Donald Trump will retake the presidency brimming with confidence, a sense of historic mission ... and a powerful mandate.
Donald Trump 2.0 will shock the world through a major remaking of the American economy and US power, while altering the cultural trajectory of the nation as the ascendant political figure of the times.
While there are barriers to the Trumpian revolution unfolding across the realms of foreign, economic and cultural policy, his second presidency will cast battlelines across US politics for at least a generation.
The channels of political power are already aligning for Trump to prosecute his change agenda after winning both the House of Representatives and the Senate, sweeping the swing states and claiming victory in the popular vote.
He is now capitalising on the centralisation of Republican power in Washington, with the president-elect elevating fealty to his political vision above all else. His cabinet appointments are loyalists, chosen to give expression to his political will.
Trump has learnt from his first-term selections and his experience in refashioning the GOP by defying or converting all internal critics – largely through the force of his political persona, maverick charisma and populist appeal to middle America.
Rising from the ashes of his 2020 defeat, the ignominy of the Capitol Building riot and two assassination attempts, Trump will retake the presidency brimming with confidence, a sense of historic mission and a powerful mandate.
He will feel emboldened to do things his way – even if it requires ignoring well-worn democratic conventions. All the early signs point to this.
Witness the appointment of Elon Musk and former presidential candidate Vivek Ramaswamy to a new entity tasked with restructuring the federal bureaucracy, and the nomination of Fox News TV host Peter Hegseth as defence secretary. Musk set the tone for radical change in October when he boasted he could achieve $US2 trillion ($3 trillion) in federal spending cuts.
Trump has also signalled his intention to bypass the Senate confirmation process for cabinet picks in what would be a key expansion of presidential authority.
This could set up fresh power struggles, including over his nomination of Matt Gaetz as attorney-general, whose appointment shocked even Republican politicians who are doubtful that he could head up a department which only last year was investigating whether he had breached sex-trafficking laws.
The selection of vaccine sceptic Robert Kennedy Jr as the nation’s top health official with responsibility for running the nearly $2 trillion Department of Health and Human Services – including the Affordable Care Act, Medicare and Medicaid – may also test the patience of Senate Republicans.
Trump’s sweeping “day one agenda” includes dismantling the deep state, pursuing mass deportations, imposing across-the-board tariffs, scrapping the “Green New Scam”, withdrawing from the Paris Agreement, rolling back environmental regulations, ending the Ukraine conflict, unpicking pro-transgender policies, pardoning January 6 offenders, and rolling back the Biden health and education agendas.
This is a blueprint to overhaul the country. Leading thinkers are already focused on which items are set in stone and which could merely be attempts to enhance Trump’s negotiating position.
While Trump is a familiar political figure, this exercise reveals his policy agenda has still generated widespread uncertainty. Paradoxically, no one knows how the experiment will turn out or even exactly what it is – a recipe for a populist catastrophe, or a profound new American reinvention.
On foreign policy, his appointment of Marco Rubio as secretary of state, Mike Waltz as national security adviser and Elise Setfanik as UN ambassador suggests he will be tough on China and strongly pro-Israel in navigating the Middle East.
Rubio has pronounced China as the “threat that will define this century” – a possible insight into the outlook of the new administration.
But there are concerning signs about whether the US will remain a reliable ally under Trump and if his strategic and trade policies can operate in harmony with one another.
Charles Edel, Australia chair at the Center for Strategic and International Studies, tells Inquirer there are “a lot of big questions about what America’s approach to the Indo-Pacific will now be”.
There are doubts, he says, about “how much Trump will be willing to work with traditional allies and partners, what America’s trade policy and use of tariffs will look like, whether Trump will support investments in critical technologies, and how his affinity for authoritarian leaders will be a factor. There’s a view among many Trump advisers that China is the foremost strategic challenge the United States faces, and that Washington needs to shift more focus and resources to the Indo-Pacific to deal with that challenge. If this view translates into policy we’re likely to see a competitive approach to dealing with China that extends across a number of different fronts.”
But Edel says there is also “another approach, more transactional in nature, that Trump might pursue, which could undercut a competitive approach.
“If Trump decides to use tariffs indiscriminately – against ally and adversary alike; and, against those who have trade surpluses and those who run trade deficits with the United States – it will become much more challenging for Washington to find support for its efforts to build a broad coalition of nations willing to push back against China’s predatory economic, technological, military, and political activities.”
On economic policy, there are well known warnings over the Trump agenda. Senior fellow at the American Enterprise Institute Stan Veuger tells Inquirer mass deportations are “costly and will become unpopular quite rapidly if you start deporting people who are not criminals or recent arrivals.
“Many illegal immigrants in the US have been in the country for over a decade and millions of them have US citizen spouses or children,” he says. “If Trump deports five times as many people per year from the interior (not people who just crossed the border) as he did in his first term, that would be 430,000 people a year. In comparison, with the stroke of a pen he can terminate the refugee resettlement programs and the humanitarian parole program for Cubans, Haitians, Nicaraguans, and Venezuelans: 460,000 arrivals a year.
“A very low-immigration scenario might cut GDP growth by close to half a percentage point next year. In that scenario we would have net out-migration.”
The imposition of tariffs would also distort choices by households and firms, creating “additional economic harm”, Veuger says.
A review of the US-Mexico-Canada Agreement meant it was unlikely that either country on the US northern and southern borders would face meaningful tariffs any time soon.
“On the opposite extreme, I would think there will certainly be some level of tariffs applied to imports from China,” he says, warning that tariffs are a “tax increase and as such will suppress demand. For that reason they will put downward pressure on prices, GDP, and employment.”
There is no sign Trump would take a disciplined approach to fiscal policy and improve the budget position, with Veuger declaring: “All in all, I think the best-case scenario is one where debt/GDP goes from 100 per cent now to just below 110 per cent at the end of Trump’s term.”
The expected extension of personal income tax cuts would reduce revenue by about $US4 trillion over 10 years. “That is before reducing the corporate rate further, and does not account for pro-growth additions like reviving expensing of equipment investment. Lowering the corporate rate to 20 per cent and reviving expensing would cost an additional $400bn or so.”
The wild uncertainty looming over Trump’s economic agenda lies in contrast to the directness of his plan to transform US culture. Trump appealed to first-time voters and younger men because he was viewed as an anti-woke crusader, defender of Western civilisation and opponent of transgender ideology.
The president-elect won support because he fought the progressive left on values – something that conservative leaders have failed to do effectively in recent times.
This cultural reckoning promises to be both ugly and fiercely contested, with the defeated Kamala Harris only promising more of the same to supporters when she declared: “I do not concede the fight that fuelled this campaign.”
Writing in The New York Times after the election, columnist Maureen Dowd said the Democrats were “finally waking up and realising that woke is broke”. She warned Democratic Party leaders were seen as “avatars of elitism” by embracing a world view of “hyper-political correctness, condescension and cancellation”.
One of Trump’s big targets is already known – the university system – where he has vowed to go after radical left accreditors for allowing colleges to “become dominated by Marxist maniacs and lunatics”.
“We will accept applications for new accreditors who will impose real standards on colleges,” Trump said. “The standards will include defending the American tradition and Western civilisation; protecting free speech; eliminating wasteful administrative positions … (and) removing all Marxist diversity, equity and inclusion bureaucrats.”
This endeavour will serve as a test case of whether the left-wing march through the institutions can be effectively countered through a concerted political effort to reassert the strength of traditional enlightenment virtues.
While progressives are usually the leading advocates for change, the only certain thing about Trump 2.0 is that he threatens a major transformation. The nature of this transformation and its bearing on America’s destiny remains uncertain, although it will ignite the cauldron of US politics for years to come.
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