Trump: Policy Issues on Re-election

The current odds are around 40% Joe Biden to win the November 2024 presidential election and 33% Donald Trump, with the rest of the field some way distant. As we progress into 2024, more questions will be asked about what happens in the scenario that Trump is re-elected. 

Our central scenario remains that the most likely person to be elected president is Joe Biden, though this is likely to require unemployment remaining low and inflation remaining well below recent highs at the time of the election. Biden is not currently facing a serious primary challenge and is likely to secure the Democratic nomination easily barring a significant deterioration in his health. Base Republican support shows a huge lead for Trump, but when the election switches to a run off between the two candidates then swing voters attitudes are key. Opinion polls show that swing voters have issues around Trump on trust, race and how the administration is run, though should the Biden economy look weak, memories of a strong economy under Trump before the pandemic could matter. Voters do have concerns over Biden’s age, but he is only three years older than Trump and seen as more likeable by swing voters. With the economy now looking likely to avoid a significant recession, we see Biden as the most likely victor in a Biden/Trump run off. It remains feasible that one of the four trials could be concluded adversely for Trump before the Republican nomination July 15-18 2024 in Milwaukee, though the Republican base would probably stick with Trump unless he was prevented from running, which looks unlikely given the current makeup of the Supreme Court. 

If Biden is re-elected then policy would likely remain the same with support for Ukraine; commitment to climate change; constructive policy to friendly countries and strategic competition with China. If Trump was elected, then risks would exist around all four areas. 

• Trump has promised to end the Ukraine war in one day without specifying how this could be done. Two alternatives are for a re-elected Trump to push Ukraine and Europe to accept territories gained by Russia or to significantly reduce financial and military support for Ukraine. Substantial Republican and strong Democratic support for Ukraine in Congress argues against these radical options, but some form of weakening support for Ukraine could be evident. 
• On climate change, Trump would likely leave the Paris accord again and could curtail Biden IRA tax subsidies for renewable energy. It is likely that the money would be redirected towards supporting fossil fuels or cutting taxes to limit the damage on the U.S. economy, but it would be a setback to global climate change momentum.
• Matching tariffs. Trump in a recent TV interview threatened a 10% increase in tariffs, while reports suggest that Trump and his team are looking at an active tariff stance against foes and friends (here). One report is that a Trump administration could consider matching tariffs that India or China imposes, which could start a trade war if it engulfs major friendly countries. 
• China. Trump 2.0 would likely be focused on challenging China economically as much as Trump 1.0, which would probably mean the threat of more tariffs and then some actual rise in tariffs. This is bad for global trade and hence the global economy and would increase tensions between China and the U.S. in the economic field.