What would Trump do in a second term?
More nationalism. More debt. More Trump.
Did Donald Trump take over the Republican Party, or was it the other way around? Yes, Trump's multi-front trade war was a violent break from GOP economic orthodoxy. But in many other ways on policy, the president has been a traditional Republican. He's cut taxes for rich people and corporations. He's slashed regulations. And he's appointed conservative federal judges. Even the twist-and-turns of his protectionist trade policies have seemed closely attuned to the reactions of the donor base as expressed through the stock market.
President Trump's State of the Union address, however, suggests a second term might contain far less deference to traditional party priorities — and the desires of business and wealthy donors. While it wasn't a speech heavy on new policy initiatives, the absence of much talk about taxes is noteworthy. Tax cuts have been the raison d'etre of the modern GOP. And every tax cut, once passed, has merely set the stage for the next round of rate reductions. In President Reagan's re-election year SOTU in 1984, he not only praised at length the results of his sweeping 1981 tax cuts, but promised even more dramatic tax reform in the years ahead.
Trump, though, decided other issues were more deserving of focus. While he did briefly credit his 2017 Tax Cuts and Jobs for helping to "rapidly revive" an already growing economy, that was about it for taxes. Instead of the traditional Republican call to revamp the tax code in the name of faster GDP growth and simplicity, Trump merely urged Congress to pass a tax credit scholarship for contributions to state-sanctioned scholarship funds to help parents pay private and religious school expenses. Not the sort of pro-growth tax cut that Reaganite "supply-siders" care much about, maybe, but it's an important policy goal of Trump's conservative Christian base.
And that tax credit idea was hardly Trump's only SOTU shout-out to "family first" and "nationalist populist" conservatives. Trump described his agenda as "relentlessly pro-worker, pro-family, pro-growth, and, most of all, pro-American." That sounds a lot like the rhetoric from market-skeptic Republican thinkers such as Hillbilly Elegy author J.D. Vance, who speaks of "pro-family, pro-worker, pro-American nation conservatism." Instead of business tax cuts or more deregulation, the few policies Trump did mention were pretty much oriented toward such Republicans who think globalization and technology have caused too much societal disruption. In addition to the religious tax credits, Trump pushed immigration reform, suing sanctuary cities, infrastructure spending, and lowering drug prices. He also endorsed a bipartisan proposal in Congress to extend paid leave to families after the birth or adoption of a child.
If Trump wins a second term this November, it's reasonable to expect similar policy impulses. Sure, he might propose more tax cuts, but they are more likely to be payroll tax cuts geared toward middle-class workers instead of income tax cuts for rich people and corporations. He'll look for a new Federal Reserve chair less worried about inflation than current boss Jerome Powell, who deserves at least partial credit for the surging stock market and continuing expansion. Trump will let the national debt soar rather than trimming projected Medicare and Social Security benefits. And there will be more protectionism, although it may be called "industrial policy." In other words, Trump will ignore the traditional economic policy advice rich Republicans read about in The Economist, Financial Times, or Wall Street Journal.
And the donors might be fine with all that. The Trump tax cuts were sizable and they're not going away anytime soon. So that's a big long-term win. More importantly, perhaps, is that just as religious conservatives see Trump as protecting them from an evermore secular and hostile culture, wealthier Republicans see Trump as a bulwark against rising socialism, democratic or otherwise. Of course, there's nothing new about Republicans using that label against liberals and progressives. But these days it's more than just a taunt. Two of the Democratic Party's most popular national politicians, Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez, call themselves socialists and question whether billionaires should even exist. And even top Democrats who prefer the "capitalist" label, like Sen. Elizabeth Warren, are proposing large income and wealth taxes. Given that unpalatable alternative, wealthy conservatives understandably aren't going to worry so much about Trump tinkering with tariffs.
Yet why should Trump — who'll be 74 on Election Day and unable to run for a third term — care so much about pleasing family-first conservatives and the party's white-working class voters? Well, politics is the new Trump family business. And Donald Jr. and Ivanka are among Republican voters' top picks for the GOP presidential nomination in 2024. That means Trump isn't just the patriarch of a rich and powerful family, he also needs to help maintain the intergenerational Trump political brand.
In one way, at least, Trump is just as family first as his loyal followers.
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