Tariffs on Imports: Trump’s proposed 10% tariff on all imports and 60% on Chinese goods could increase consumer prices, reduce GDP by 0.8%, and cost 684,000 jobs, especially impacting retail. Tariffs on China
Elon Musk’s Role: Trump plans to appoint Musk to lead a committee focused on government efficiency, potentially reducing federal oversight, including on SpaceX and EV regulations.
Labor Unions: Trump’s support from union workers may affect his policies toward organized labor, though his past stance on unions has been mixed.
Financial Sector: Banking regulations could ease under Trump, benefiting major banks but potentially increasing inflation and interest rates.
Healthcare and Vaccines: Trump may give vaccine policy influence to RFK Jr., who is critical of vaccines, raising concerns among health and biotech leaders.
Summary
Trump’s proposed tariffs—10% on imports and 60% on Chinese goods—are expected to raise consumer prices, reduce GDP, and lead to job losses, especially in retail. Elon Musk may lead a government efficiency committee, potentially reducing federal oversight. Trump’s support among union workers could influence labor policies, while the financial sector may see eased regulations. However, Trump’s policies might also lead to higher interest rates. He could involve RFK Jr. in vaccine policy, which concerns health leaders due to RFK’s anti-vaccine stance. The election may also impact technology, renewable energy, and pharmaceutical regulations, shaping the US economy’s trajectory.
TARIFFS on China and world (detailed)
If implemented, Trump’s suggestion of a 10% tariff on American imports and a 60% tariff on goods made in China would impact the economy as a whole by causing an increase in consumer prices. The Tax Foundation, a neutral research organization, estimated that Trump’s tariffs could increase taxes by $524 billion every year, reduce GDP by at least 0.8%, and lead to a loss of 684,000 full-time equivalent jobs, possibly affecting retail employees, who make up the biggest private sector workforce. He also hinted at the possibility of implementing a 25% tax on every product imported from Mexico.
According to a study from the National Retail Federation, Trump’s proposed tariffs could potentially decrease the annual spending power of American consumers by $46 billion to $78 billion.
According to the study, clothing, playthings, furnishings, home appliances, and shoes would experience the biggest impact. Retailers plan to move their operations away from China to countries like Bangladesh, India, and Vietnam. Large retail chains such as Walmart and Target may see an increase in supply chain expenses, whereas grocery stores like Kroger, Albertsons, and Publix, which have limited reliance on sourcing from China, could experience advantages. Experts in shipping and transportation suggest that widespread tariffs may first boost their industry before reducing trade.
Tech also faces the threat of tariffs. Recently, Trump has strongly condemned the U.S. CHIPS and Science Act, which aims to provide some funding to companies constructing factories in the US. Rather, he suggested that the nation implement tariffs on imported chips, with a focus on those from TSMC in Taiwan.
Tariffs would also significantly increase expenses for the American renewable energy sectors, which heavily depend on components imported from China. According to a research note from Bernstein in October, Trump could potentially impose import tariffs ranging from 10-20% (excluding China) to 60-200% on Chinese imports without Congressional support, affecting the cost of renewable projects, especially solar and storage projects.
And the issue of China’s response also needs to be considered. It is the largest soy purchaser and pork consumer globally, however, it has expanded its sources of food following the implementation of Trump’s tariffs during his initial term. Furthermore, China did not completely meet the terms of a deal to purchase additional U.S. agricultural products as agreed upon with Trump in January 2020. In his next term, Trump plans to increase tariffs on Chinese imports to 60%, sparking worries that Beijing may respond by cutting back on importing American agricultural goods.
WHAT PART WILL ELON MUSK HAVE?
Following some encouragement from the richest individual in the world, Trump has announced his intention to appoint Elon Musk, the CEO of Tesla, to head a newly created government efficiency committee. Musk has claimed that $2 trillion of savings is possible from the $6.75 trillion federal budget. Understanding how it operates may be crucial for the upcoming Trump administration.
Does effectiveness equate to a reduction in regulations and governing bodies? Musk has openly opposed the federal evaluation of his SpaceX rocket company. This could result in reduced supervision of self-driving cars (such as those produced by Tesla) or rocket launches and beyond.
Trump and Musk are not fully aligned: Trump opposes California’s plan to mandate all vehicles be electric in ten years, despite Musk leading the leading EV company. An increase in tide levels benefits all boats. James Chen, former head of policy for Rivian and Tesla, said that it would be beneficial if Elon could lessen the criticism of electric vehicles from a possible Trump administration. Musk’s approach to handling conflicts of interest involving his investments in autos, space, health, construction, and artificial intelligence remains unclear.
Trump has promised to become a “crypto president”, a strategy that could begin by replacing industry adversary Gary Gensler, the chair of the Securities and Exchange Commission who has filed lawsuits against many industry players, such as Coinbase, Binance, and Kraken. It is anticipated that Gensler’s successor will assess accounting guidance and possibly revoke it, as well as establish industry exemptions from SEC regulations. Musk, along with Silicon Valley Trump supporter Marc Andreessen and incoming Vice President J.D. Vance, is also in favor of crypto.
Musk is a strong advocate for clean energy, with Tesla playing a significant role in providing solar systems and batteries. Trump has pledged to put an end to the offshore wind sector and cancel any remaining funds from the Inflation Reduction Act – Biden’s key environmental legislation. However, Trump is encountering disagreement within his supporters: GOP legislators, oil corporations, and others anticipate significant benefits for Republican-controlled states from the legislation. Musk has contributed to that by constructing his second electric vehicle factory in the United States in Texas, for example.
LABOR UNIONS
Under President Joe Biden, organized labor saw significant advancements when he stood in solidarity with U.S. auto workers on a picket line. The UAW aims to increase its size and may seek federal government intervention in upcoming strikes, potentially weakening the bargaining position of workers, a move Democrats have not supported thus far.
Republicans have normally not supported unions, but Trump has taken a different approach by appealing to blue-collar workers. Anthony Miyazaki, a marketing professor at Florida International University, suggested that significant backing from numerous union workers could compel Trump to safeguard those voters. However, his history of selecting individuals for the National Labor Relations Board led to a weakening of workers’ ability to create unions. If this pattern continues, there is a possibility it could undo the progress unions have achieved during the pandemic, such as their successful campaigns at Starbucks and Amazon, as well as emerging movements at Apple, REI, and Trader Joe’s.
FINANCE
In the banking sector, JPMorgan, Goldman Sachs, Bank of America, and other lenders are expected to experience a break from rigorous capital requirements, merger and acquisition challenges, and President Biden’s crackdown on excessive fees. It is anticipated that Trump will rapidly appoint Republican officials who are supportive of the industry to the financial regulatory bodies. However, the benefits could be canceled out if Trump enacts tax and trade measures that increase the deficit and inflation, leading to higher interest rates. Analysts warn that this could cause current loans to fall into debt.
TECH AND OTHERS
Attorneys suggested that Trump may retract the Department of Justice’s attempt to dismantle Alphabet’s Google and opt for settlements with corporations regarding competition concerns in mergers, instead of pursuing new trials. The country’s stringent, chief enforcer of mergers, Chair of the Federal Trade Commission Lina Khan, is likely about to leave. On a larger scale, supporters of Trump in Silicon Valley, such as investors Peter Thiel and Marc Andreessen, as well as Tesla CEO Elon Musk, advocate for decreased regulation of emerging technologies like artificial intelligence and rockets. Former venture capitalist Vance is their champion.
Jeff Bezos, the owner of the Washington Post, made the choice a few days prior to the election not to support any presidential candidate, stating it was a principled decision to restore trustworthiness. Many subscribers departed, with a majority attributing their departure to political cowardice. Both USA Today and the LA Times chose not to give their endorsement to any candidate. Former FCC Chairman Tom Wheeler stated that the message is quite clear at the present moment. New York University School of Professional Studies adjunct associate professor Helio Fred Garcia, who has authored two books on Trump, stated that agreeing in advance is like giving in to the dictator.
In the campaign, Trump urged the Federal Communications Commission to revoke the broadcast licenses of ABC and CBS. FCC Chair Jessica Rosenworcel criticized Trump’s suggestions to cancel licenses for broadcast stations, highlighting the importance of free speech rights. However, Wheeler warned that the FCC’s independence may be in danger if Trump fulfills his promise to place regulatory agencies like the FCC under presidential control. The president could also use his emergency powers under the Communications Act to regulate broadcasters, citing concerns related to “national security.”
A second term for Trump is expected to boost cable TV news networks such as CNN, Fox News, and MSNBC, as well as news outlets like the New York Times.
PHARMACEUTICALS
President Trump recently stated that he would allow Robert F. Kennedy Jr., a former presidential candidate and vocal opponent of vaccines, to have more influence on vaccine and healthcare policy. Kennedy claimed that Trump assured him authority over the FDA, CDC, HHS, and USDA. These positions have the potential to provide him with authority to determine which vaccines are authorized and if Americans should be advised to get them. Howard Lutnick, a co-chair of the Trump transition team, stated that Kennedy will not be leading the Department of Health and Human Services, but he could potentially provide guidance on vaccines.
Jeremy Levin, who is the CEO of biotech company Ovid Therapeutics and a former chairman of biotech lobby group BIO, stated that he would be worried if Kennedy was put in charge of vaccines, and noted that other leaders had similar worries. He said that vaccine denialism, a key belief of RFK’s, is as risky as anything one can envision, noting that President Trump’s past choices for the COVID vaccine initiative and the FDA indicate to him that more moderate stances will prevail. Some executives were also worried that Kennedy’s influence could negatively impact the reputation of the U.S. and its ability to evaluate new drugs.
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