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the national interest

Oct. 4, 2024



Why A Second Trump Term Might Go Full Social Darwinist
Tax the poor, slash the welfare state, tax cuts for the rich…


By 
Jonathan Chait,
          who’s been a New York political columnist since 2011. 
He writes the newsletter &c.







Photo: Intelligencer; Photo: Getty Images






One of the paradoxes of Donald Trump’s campaign is that his best issue by far is the economy, yet nobody knows what he would do about it. Trump has flooded the zone with populist promises, each more absurd than the last. He would impose a 10 percent tariff. No, 20 percent. He would eliminate taxes on tips, overtime pay, and Social Security and limit interest rates on credit cards to 10 percent (another implausible but round number, given that the average credit card charges a rate more than twice as high). He would restore the state and local tax deduction that his own tax cuts repealed. After once dismissing cryptocurrency as a scam, he has proceeded to embrace it, perhaps after belatedly realizing scams are kind of his thing.
Trump’s Republican allies tend to wave off this string of nonsensical offerings as irrelevant to his agenda. He won’t do all these crazy things because he can’t: Either Congress won’t pass them, or they would have effects so devastating he’d be forced to course-correct immediately, or — like his suggestion he might “pay off the $35 trillion [federal debt] in crypto. I’ll write on a little piece of paper ‘$35 trillion crypto.’ We have no debt” — they are metaphysically impossible.
Every presidential campaign begins with ambitious plans that shrink upon contact with governing realities, but the extent of Trump’s incoherence is without precedent. Nobody, including within the campaign itself, believes Trump even wants to implement anything resembling his stated agenda. As Bloomberg News reported, “Even his own advisers are unsure about which ones he intends to enact if elected.” J.D. Vance has added to the confusion by alternating between offering that Trump’s intention is to roll back Obamacare’s protections for preexisting conditions and then insisting delusionally that Trump during his first term worked with Democrats (?) to save Obamacare(??).
And so the range of governing outcomes in the event Trump wins is unusually broad. It’s possible that, as in his first term, he muddles through, advancing the familiar Republican mix of regressive tax cuts, deregulation, and little else. It’s also possible that Trump will find his way toward some new populist synthesis that he has manifested in rhetoric and style.
But there is a third possibility, one that received far less attention than either of these: What if Trump goes all in on something like the traditional conservative anti-government agenda? What if it is finally Trump who fulfills what Barry Goldwater, Ronald Reagan, Newt Gingrich, and Paul Ryan dreamed?
There is no reason to believe Trump currently harbors any intention to play this historical role. But it is certainly possible that this is where he could arrive four months from now.



The Republican Party’s most distinctive feature, the one that sets it apart from conservative parties in other industrialized democracies, is its refusal to accept the legitimacy of the welfare state. The dominant tradition of the American right is a belief that the distribution of income produced by markets is morally sacrosanct, an ideology Richard Hofstadter characterized as “Social Darwinism.” American conservatives greeted every new social benefit, from Social Security to Medicare to Obamacare, as a socialist or communist plot that would inevitably cascade into economic collapse and political tyranny. While conservatives have staged retreats or pauses in their war against the state, they have never consciously accepted the extension of government that began under Franklin Roosevelt as beneficial or unavoidably permanent. They most vociferously reject the tax and transfer mechanism, by which the rich pay higher tax rates to fund benefits for the non-rich.
Viewed from the left, conservatives seem to have controlled the terms of public debate since Reagan’s time. But from the right, the Reagan and post-Reagan eras have failed to roll back the New Deal’s most objectionable elements. Their frustration goes a long way toward explaining the base’s populist turn. Conservatives have stewed in resentment as their party has repeatedly won elections while failing to stop the growth of social programs they warn pose an existential threat to the American way of life. At every turn, they are being tricked by the Democrats or betrayed by their own leaders.
Trump absorbed that rage and turned it into a somewhat different mode of politics. That is why he is widely seen as a “populist,” the antithesis of a traditional Republican. But during his first term, Trump hewed more closely to the conventional Republican style than his rhetoric suggested. More importantly, circumstances in a second term would be very different and might well push his economic policy further right.
Conservatives grumbled that Donald Trump spent too much money during his first term, but that is typical of modern Republicans. Ronald Reagan, George W. Bush, and Trump all enacted enormous, regressive tax cuts combined with buildups in spending, especially on the military. They all followed the same formula because it is the path of least resistance for Republicans.
What enabled the formula to work, however, is a set of economic conditions that no longer prevails. Reagan and George W. Bush inherited low deficits from their predecessor. Trump inherited a budget deficit that was slightly higher, about 3 percent of gross domestic product, just slightly higher than the growth rate of the economy. More importantly, the labor market still hadn’t fully recovered from the Great Recession, and increasing the deficit could stimulate growth without causing inflation or interest rates to rise. Trump’s deficits ate up this cushion as the economy returned to full strength.
His popular mix of tax cuts and free spending came during an era in which Washington could issue as much debt as it wanted and have no problem finding customers willing to lend it money at rock-bottom rates. That time, which ran roughly from the George W. Bush era to the first year of the Biden administration, is now distant history.
Whoever takes office next year will face much higher interest rates than Trump enjoyed during his first term. The budget deficit is running to over 6 percent of GDP. For the debt to be growing twice as fast as the economy during peacetime, at the peak of the economic cycle, is a genuinely concerning fiscal constraint. A second Trump term would not have the path-of-least-resistance solution of cutting taxes without making anybody pay for it. Higher deficits would likely bring swift consequences from the Federal Reserve.
Running back the first term Trump playbook is probably off the table. A second Trump term would respond, one way or another, to dramatically altered circumstances.



One precedent for this scenario is the only modern Republican who broke his party’s pattern of tax cuts and borrowing. George H. W. Bush inherited Reagan’s bloated deficits and high interest rates that threatened to choke off the recovery. That combination forced Bush to cut the deficit — and, with a Democratic Congress, his only option was to mix slightly higher taxes on the rich with spending cuts.
Bush had campaigned forcefully promising he would not raise taxes a penny even if Democrats demanded it. (“Read my lips: No new taxes!”) Bush knew that the deal was toxic. But he did it because the combination of high deficits and high interests rates gave him no other choice.
In the face of immediate economic imperatives, presidents discard their campaign promises. The question is not whether Trump would break his promises — which are collectively impossible to fulfill even under optimal circumstances — but which promises he would break.
Theoretically, he could reach out to Democrats and forge a bipartisan agreement to raise taxes on the rich and cut spending. But it’s hard to read that sentence without laughing, isn’t it? The Republican Congress revolted when Bush did this in 1990, the party has moved far, far to the right since then, and Trump is congenitally unwilling to break with his right wing or deal with the opposition in good faith. During his first term, Democrats were begging him to make an immigration deal that would let him declare victory on his signature build-the-wall promise, but he couldn’t pry himself away from the recalcitrant wing of the party that hates compromise and adores him. This scenario can be ruled out.
Trump’s initial priorities are likely to focus on two goals: cutting taxes and raising tariffs. To a degree, the two can work together. Trump has floated various versions of his plans to cut taxes, but assuming he discards his more pandery elements and focuses on the ones Republicans actually want to implement, the revenue loss would run somewhere in the $4 trillion range over a decade. Once Trump has locked in deep tax cuts, fiscal pressure could quickly intensify.
Trump has grown obsessed with tariffs as an economic elixir, proposing to go far beyond the ones he employed his first term. Republicans generally dislike tariffs. Importantly, though, Trump believes he can impose them using executive authority, as he did in his first term. (“I don’t need Congress. I don’t need them,” he’s said. “I’ll have the right to impose them myself, if they don’t.”)
And some of Trump’s advisers among the party’s economic pseudo-intelligentsia have reconciled themselves to tariffs as a way of covering the cost of their beloved tax cuts. Supply-side economists who have Trump’s ear, like Stephen Moore and Arthur Laffer, have explained that tariffs “will raise funds to help cover” the cost of tariffs.
For all their flaws, tariffs have one key attribute that endears them to the right: They raise revenue in a regressive way. Before the 20th century, the federal government was far smaller and relied on tariffs as a financing mechanism. The growth of the income tax, a measure conservatives fought bitterly and have never quite gotten over, enabled a larger and more redistributive government. Trump has begun talking about replacing the income tax entirely with tariffs. And while that goal is probably impossible — the tariff rate necessary to completely replace income taxes would be so forbiddingly high that consumers would simply stop buying imported goods — the concept moves in a direction conservatives find intriguing. Imagine Trump as the demagogic front man, selling a scheme to massively shift the revenue burden from the rich to the non-rich, using the trade war and promises of bringing jobs home as cover.



One reason Trump’s first term is remembered as “populist” is that his effort to repeal Obamacare failed. Had he succeeded, Trump would likely have been memorialized as the most doctrinaire conservative president since the 1920s.
He failed, of course. Yet that failure does not mean Trump moderated his views on health care, nor does it indicate that he has surrendered his ambitions to destroy Barack Obama’s most famous legacy. To the contrary, Trump — with much less fanfare — undermined it administratively through steps like restricting enrollment times and giving waivers to Republican states to reduce coverage. Those efforts to strip coverage from those too poor or sick to purchase it without help bore fruit. Over Trump’s first three years, the number of uninsured Americans rose by more than 2.3 million.
And as his running mate, J.D. Vance, has happily boasted, Trump would like to reverse Obama’s insurance regulations, letting insurance companies charge exhorbitant rates to older and sicker customers so that young and healthy ones can pay less. Senator Tom Cotton told NBC News that during a second Trump term, he would want to pass a massive fiscal bill combining tax cuts and “make health care more affordable, more tailored and more personalized than the one size fits all option.” (This is how Republicans euphemistically describe changes to let insurers charge young and healthy people less and those who are old and sick more.)
During Trump’s first term, the war against Obamacare was primarily a matter of ego for Trump. In a second term, finding ways to reduce federal spending on health insurance might be an economic priority.
Deficits and interest rates might likewise revive another Trump priority hiding in plain sight: his desire to slash spending on the poor. Trump’s budgets proposed hundreds of billions of dollars in cuts to anti-poverty spending. Those proposals included cuts of 25 to 30 percent in the Supplemental Nutrition Assistance Program, rental increases of about 40 percent for people using housing vouchers or public housing, and tens of billions of dollars in cuts for disabled low-income children, Temporary Assistance for Needy Families, and Social Security disability benefits, as Robert Greenstein has detailed.
Trump had other priorities in his first two years, and he had a Democratic Congress in his second two, making these radical proposals an afterthought in press coverage. But the very different context of a second Trump term could well revive these dormant ambitions.
And if Trump truly decides he wants to (or has to) go for it, there is a chance he will implement deep cuts to Social Security and Medicare. In January 2020, a conservative-leaning host asked him about cutting entitlements, which is conservative code for Social Security and Medicare. “At some point they will be,” he replied, “We have tremendous growth. We’re going to have tremendous growth. This next year I — it’ll be toward the end of the year. The growth is going to be incredible. And at the right time, we will take a look at that.”
From the vantage point of today, in the middle of a campaign in which Trump is frantically pandering to public opinion, the portrait of him as a ruthless austerian may appear far-fetched. It is important to recognize, however, that Trump’s “populism” is a matter of pure expediency rather than conviction. He has an instinct for the crowd, but he is a wealthy man who prefers to be surrounded by other wealthy men, whose affluence he equates with intelligence. In a second term, he would be liberated from any need to win future elections. His incentive would instead run toward cementing the loyalty of Republicans, whom he would need for financial support and legal protection in his post-presidency.
It is important, also, to understand how Trump’s instincts guide him. He is motivated by animus and partisanship, and these emotions draw him closer to the most partisan Republicans, who defend him in the most shameless ways. Those Republicans are still, by and large, the most radical on domestic policy. As J.D. Vance admitted privately in 2020, and as Ross Douthat recently conceded in a column, Trump’s much-ballyhooed populist reinvention of the party has never really cohered. The Trumpiest Republicans are still the most conservative ones, and the most conservative ones hate government in general and redistribution in particular.
The Republican Party’s posture toward the New Deal has wavered between contempt and fear. It still craves a return to the small government that prevailed before that man created the modern state. And yet it fears the political consequences of actualizing its vision.
The compromise has been to shelve its ambitions without giving them up. Like all radical sects harboring deeply unpopular goals, Republicans wait for a moment when old assumptions will crack and the impossible will become suddenly possible. That moment might be a fiscal emergency. It might be the sensation of invulnerability that comes from electing a man who four years before was left for dead after he led an unsuccessful insurrection attempt. It would be surprising, but hardly shocking, for the revanchist project that has lain dormant but not extinct in Trump’s party to spring suddenly back to life.





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Think the “social darwinism” will be less federal support for mass transit, less school lunch type programs, and probably eroding worker safety nets^1 further.  

We’ve also seen this movie before, so the sequel (a Trump 2.0 admin) will feature cliques of advisers, CEOs, the VP, etc.. fighting each other and trying to influence Trump before Air Force 1 takes off to the next golf game. 

What is clear is we will likely see millions deported, millions more families disrupted, a lot of protestors beat up, and likely sleeping towards environmental degradation once again.   The price of everything for the poor typically going up, up, up, up, up.   Hate crimes will go up and his advisors will likely try to spread MAGA via bargaining. 

Trump will be focused on “his” stock market, which could actually serve as a brake in some respects.   A market smash-up is probably the only thing that’ll distract him from golf. 

All that assumes no geopolitical disaster.  These guys will likely be like Beavis and Butthead playing with a lighter and flamethrower inside a napalm factory.