Trump’s post-election strategies, including significant tax cuts and deregulation, aim to reduce inflation and boost the economy, leading to market optimism despite potential risks associated with high interest rates and government spending.
Economic Strategy
Trump’s plan aims to combat inflation through massive spending cuts of up to $2 trillion out of $3 spent, coupled with higher interest rates to curb household and business spending, contrasting with Biden’s approach of raising rates to control prices.
The proposed economic plan includes across-the-board deregulation focused on manufacturing, energy, and small businesses, paired with lower income taxes and promises of the biggest tax relief since Ronald Reagan, potentially including a partial or total repeal of the income tax.
Trade and Immigration
Trump has suggested tariffs on all imports with special rates for China, though the Chinese government is likely to absorb most costs through export subsidies, shifting the burden to Chinese citizens rather than Americans.
Policies aim to reduce illegal immigration and increase deportations, potentially creating job openings for Americans and leading to higher wages for unskilled labor as people transition from welfare to employment.
Government Spending
The plan targets a reduction in welfare spending by $150 billion, currently allocated to illegal immigrants, aiming to lower welfare costs and increase wages for unskilled labor and related products.