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A guide to what the 2024 US election means for Washington and the world.
The author is director of economic policy research at the American Enterprise Institute.
Donald Trump’s spectacular return to power has cemented his status as a historically influential figure. His influence began in 2015 on the now-iconic golden escalator of Trump Tower, but Vice President-elect J.D. Vance, in particular, will work to ensure it continues into the next decade. We live in the age of Trump.
Even as a second-term president, he will wield tremendous power, especially if his party controls the House and Senate, which is likely to be the case over the next two years. However, President Trump is still a lame duck whose term is limited by the U.S. Constitution. The battle for the future of the political right began Wednesday morning.
The first front in that battle will be some pressing policy decisions that expose the biggest rift surrounding the Republican Party and Mr. Trump: the divide between populists and traditional “supply-side” conservatives.
First of all, taxes. Next year, Republicans will be responsible for reforming the tax code as provisions of President Trump’s 2017 tax law expire. Populists are skeptical of big business, and Vance, a more pro-Trump populist than Trump himself, argued as recently as May against further cuts in corporate tax rates. Mr. Vance is also betting on other positions against big companies.
But Mr. Trump has sided with traditional pro-business conservatives and is pushing for further cuts in corporate tax rates on top of those enacted in 2017.
Similarly, several prominent populist Republicans have backed Lina Khan, the Biden administration’s controversial antitrust enforcement official, for going after Big Tech and enforcing competition policy more aggressively. But with another victory for pro-business conservatives, Mr Trump is expected to replace Mr Khan. His re-election has sparked optimism that there will be more mergers and acquisitions over the next four years.
Populism seems certain to lose some big battles, as President Trump supports traditional Republican policies. Also, his supply-side policies are likely to be more durable than his populist policies. In the long run, political success must be built on the foundations of policy success. And evidence suggests that populist policies such as tariffs do not improve economic outcomes for workers or households.
One of the lasting victories of the Trump era is not the populist lesson that big business is problematic and should be treated with suspicion, but the importance of low business taxes for ordinary workers and households. Maybe it’s something to emphasize. President Trump’s 2017 corporate cuts increased business investment, worker income, and multinational companies’ domestic operations.
Then there is trade. Trump is firmly in the populist camp here, pledging to significantly strengthen the tariffs he instituted during his first term. This will harm the working class rather than help it. It is clear that his 2018-19 trade war reduced manufacturing jobs, made domestic manufacturing less competitive, and failed to meaningfully weaken U.S.-China economic relations.
To be sure, Trump will continue down this alarming path. But protectionism has not won the intellectual debate, and the business community, which is a powerful force in the Republican coalition and will become stronger again, supports free trade. With the exception of China, the political right may eventually return to its pro-trade roots.
If there’s one issue where President Trump’s populism is likely to continue, it’s immigration. His public stance is pure populist, demonizing immigrants and promising the largest deportation effort in U.S. history. He seems to have won the argument here: The American people want a secure southern border and will not tolerate a mass influx of illegal immigrants.
But a closer look shows that President Trump has already been quietly sending mixed signals on legal immigration, suggesting he may support an increase. I’m skeptical. You’ll soon find out.
These battles over the future of the right are likely to divide the Republican Party in the coming years. But there are other key elements to President Trump’s populist message that seem doomed. His desire to side with “the people” led him to oppose anticipated cuts to Medicare and Social Security spending. However, the country’s fiscal imbalance is unsustainable. Future Republican officials will have no choice but to address this issue.
Global Stage is one example. Every time the United States withdraws from the world, the accompanying increase in geopolitical instability always brings us back. We too are benefiting from the peace and prosperity brought about by the post-World War II international order.
More importantly for the future of Trumpism, the proportion of voters who accept his dark message of “American genocide” should decline in the coming years. This was particularly strong in the years following the 2008 financial crisis. This week’s results show that workers and households have retained much of their strength, despite being shaken first by the coronavirus pandemic and then by rapid inflation and price increases. However, these experiences are abnormal and not the norm.
Trump has always been a uniquely gifted messenger. But partly because of this, Trumpism is unlikely to outlast him. The battle for what comes next has already begun.
This article has been amended to correct the spelling of Lina Khan.
