Four More Years?

The first priority of any incoming US administration, so the adage says, is a second term. As someone who finds the prospect of a Trump presidency abhorrent and terrifying in equal measures, my first reaction has been to retreat under a large boulder, or else to emigrate. However, Mr Trump is a fact, and he will be thinking of what he needs to accomplish in order to be re-elected.

This presents an interesting question: what might work for him? Mr Trump has been on several sides of most issues, thus one could argue either that he has a mandate for nothing, or a mandate for (more or less) anything. And having been disavowed, explicitly or implicitly, by the Republican Party, he has a degree of freedom unfamiliar to all post-Reagan presidents to craft cross-party alliances.

There are two broad themes that one can explore: the pragmatic, and the ideological. The Republican Party in Congress is for the most part in the latter camp, while Mr Trump and his core acolytes are mainly (with some notable exceptions) in the former camp.

So let's start with the pragmatic. Mr Trump has promised to restore manufacturing jobs to middle America. This is as hollow a promise as one could make - jobs were mainly eliminated by automation, and those that have been offshored will come back because of the demands of customers and not because of anything the administration does. Imposing tariffs will spark retaliation to the detriment of everyone, and most of all the Administration.

But, US corporations have about $2.5tn parked offshore. A 15% repatriation tax would raise about $400 bn, that could be spent on infrastructure starting in 2018 (legislation doesn't happen overnight). If the Federal Government were to borrow and invest an equal amount, US GDP could be boosted above current trends close to 2% by 2020. This would hit Mr Trump's target of 4% growth, granted in an unsustainable way, but would still deliver a core campaign promise. Tax cuts for the rich would have a substantially lower impact, and would lead to inflation and reduced growth in later years, but would further boost the economy in the short term.

One should therefore expect aggressive efforts to persuade Congress to enact revenue-neutral corporate tax changes together with relaxed constraints on cash repatriation.

Immigration is the second area where Mr Trump is compelled to act. He is certain to seek approval for an expanded border fence. And he is likely to get what he wants, possibly subject to humanitarian amendments. It's unlikely he will ever be granted a Deportation Force (something so disgustingly un-American I hope we never witness it, an aberration borrowed from Europe's fascist past) but he will undoubtedly be granted a buttressing of the border. And he has a point: all countries do need to control their borders. The fact that the Obama administration has set records for deportations, especially of criminals, has been ignored by Mr Trump, but it is nevertheless true. Expect policy here to continue largely unchanged, but with exaggerated fanfare and bombast.

Trade is another area where action is demanded. Mr Trump has announced he will withdraw on day 1 from the TPP. Given some of the terms of the deal (for instance, secret arbitration proceedings in which corporations can litigate against elected governments hidden from public scrutiny) this is in some respects a good thing, although China will be the principal political beneficiary of US withdrawal. NAFTA is likely to be left largely alone, because it is a fact, but the TPP may be all Mr Trump requires to show decisive action. Expect noise but little actual action on NAFTA.

A huge infrastructure effort, relaxed terms for repatriation of corporate cash, modest revisions to free trade, and plenty of noise on immigration, would likely be enough by themselves to see Mr Trump win a second term. What could hold him back?

Health care is a good place to start. The Republicans have railed for years against the ACA. Yet the only ways to provide national coverage are either a requirement that people obtain insurance, or a single payer plan. The ACA is imperfect but it works, at its heart, by requiring the healthy to subsidise the sick. The structure was created by the Heritage Foundation, hardly a bastion of the left, and is the only largely private option to permit lifetime coverage. Mr Trump could fix some of the details that stand to be improved in the ACA, but wholesale repeal will eliminate coverage for millions. Meddling materially with the ACA is unlikely, despite campaign promises to "repeal and replace." These were patent nonsense and the risks of any repeal would be substantial to Mr Trump.

Next, in no particular order, comes climate change. Coal is declining because it is expensive and dirty. Sulphur and mercury are multi-state pollutants. Eliminating the EPA will not give free rein to coal, and the economics of power generation increasingly favour gas and renewables. Mr Trump could certainly approve the Keystone XL pipeline, which at current oil prices will never be built. But if he is smart, he will allow renewables to continue to grow. In a market without price distrortions, renewables will win.. And with a sensible price of carbon (which could be rebated to consumers via tax cuts, a potentially popular and populist measure) they will win more rapidly. Climate change, alas, is a (truly terrifying) fact of life. No serious objective observer disputes this, and Mr Trump would incur serious political risk by seeking to undermine materially, current US-led efforts to diminish the dangers of climate change.

The Supreme Court is a thornier issue. Mr Trump has vowed to appoint originalists. But the hard truth is that we all interpret the present, and the past, through our own filters. Nobody can really know what the framers had in mind in the 1780s, neither justices like Scalia, or Sotomayor. We can craft arguments, but they are subjective. 

Mr Trump has conceded post-election that same-sex marriage is a settled issue. Given his propensity to extemporise, nobody should take this as a given. Increasingly, people are adapting to the notion of marriage as a civil rather than religious right (the issue was initially painfully contentious in Massachusetts, where I live, but is now taken for granted). Any reversal here would be hard to sustain - what would one do to the people already legally married? - so I don't expect any change of heart by the capricious Mr Trump.

Women's choice is, of course, the heart of the Supreme Court question. Mr Trump won the election because, according to exit polls, he secured over 50% of the votes of white women. It's hard to imagine him sustaining this support if he undoes Roe vs Wade through deliberate judicial selection. Regardless of whether he could obtain Senate approval, this strikes me as a policy choice designed to narrow support. On the other hand, the congressional party is almost monolithically anti-choice, and activists generally include opposition to abortion as a fundamental Republican tenet. This issue may become a damned-if-you-do, damned-if-you-don't question. Mr Pence as Vice President points one way, alt-righters like Mr Bannon are an enigma, and who can say for the paranoid anti-islamers?

Then there is foreign policy. The Guardian recently ran a scurrilous story indulging speculation in the hold Vladimir Putin may have over Mr Trump. Absent any evidence one should severely discount such twaddle. But the underlying issue, of a redirection of US foreign policy, is a real concern. Appeasement of Russia or China that leads to territorial changes (the Baltic republics for instance, or Ukraine, or Trans-Dniester, just to name a few in Europe) would be a disaster for Mr Trump. In fact, it's hard to see, given the embryonic national security and foreign policy team beginning to emerge from New York, how we can possibly avoid some calamity. Thus there is scope for electoral damage high on the Richter scale, based on current Trump appointees.

The final question for me is the tenor of the 2020 campaign. With a limited focus on trade, restraint on the environment, aggressive infrastructure investment, and superficial actions in energy and immigration, Mr Trump is likely in my opinion to win easy re-election. However, he has demonstrated that he is perhaps his most effective enemy. His propensity to stoke the flames of (crudely put) white anglophone nationalism, was an ugly lurch he may choose to accentuate even further in 2020, especially if he veers beyond narrow economics into social re-engineering. Stigmatising the press can only take one so far, and ranting tirades smack more of the 1930s than today. Mr Trump has inflicted damage on the social and political fabric of the US. It may not all be bad - many people who had for years felt excluded, voted for Mr Trump - but there is a deep danger, if he emphasises the more sectarian facets of the multiverse of policy and value statements he has made through the campaign, that he will further fracture and divide a country in urgent need of healing.