On November 5, Donald Trump was elected to a second term as president, winning all the swing states and decisively beating Vice President Kamala Harris, after a tumultuous campaign season. Throughout the campaign, Trump often touted his economic recovery plan, intending to reduce inflation and ease prices for consumers, as Gallup polls were showing the economy as an “extremely important” issue for 52% of voters. While inflation was widespread globally in the aftermath of the Covid-19 Pandemic, U.S. inflation had fallen to target levels in 2024, and economists believed the U.S. had achieved the so-called “soft landing.” Many economists saw the lower inflation, low unemployment, and GDP growth of 2024 as signs of a strong economy coming into the election year. However, ordinary Americans felt differently. Although inflation had come down from its high of 9.1%, the prices of items at the store were still very high and had not come down. This year, dissatisfaction with politicians due to inflation was a global phenomenon. According to ABC news, over 80% of incumbent parties lost seats in 2024 elections.
To help the economy, Trump proposed increasing tariffs on foreign imports, cutting taxes, and deregulation. Another issue that resonated with his voters was cracking down on illegal immigration. Trump has repeatedly called undocumented immigrants “the enemy within” and promised “the largest deportation program in history.” Trump often blames illegal immigration for increased housing prices and says “they’re taking your jobs,” referencing economic hardship felt by many Americans, and offering undocumented immigrants as a scapegoat. Trump’s solutions to ongoing economic problems directly contributed to Trump’s improved performance in swing states and overall nationally compared to his 2016 and 2020 results, as voters saw him as the “change candidate” who would fight inflation and improve economic opportunity for middle-class Americans. But will Trump’s policies help the economy?
Additionally, Trump’s immigration policies could have catastrophic effects on the economy, not to mention the humanitarian and legal problems.
While campaigning, Trump has proposed a 10–20% tariff on all goods imported into the U.S. and 60% on all goods from China. Trump often says that these tariffs will be paid for by other countries and will protect American jobs and manufacturing. While this protectionism may support American manufacturing, it will certainly not lead to lower prices for consumers, and could spark a trade war. Tariffs were not a common economic tool for the U.S. government in the century before Trump. A tariff is a tax paid by the company importing goods to the U.S., which is then often passed on to consumers by the company selling the goods. In the 1800s, tariffs were the primary source of government funding, but after the 16th Amendment instituted income tax, tariffs largely fell out of favor as economic policy. An example of the consequences of tariffs is the Smoot-Hawley Tariff of 1930. Introduced to relieve the effects of the Great Depression, the Smoot-Hawley Act raised existing tariffs to help farmers, however, it was unpopular, opposed by economists, led to tariff retaliation, and ultimately worsened the Great Depression. If Trump imposes a 20% tariff on all imports, this will directly lead to a 20% price increase on foreign goods in the U.S. However, the prices of domestically made comparable goods will also increase by nearly 20%, because American-made companies can charge more, due to reduced competition from foreign companies. According to the Peterson Institute for International Economics, the Trump tariff plan will cost a typical household $2,600 a year. If Trump imposes the tariffs he has called for, this will very likely lead to increased prices of consumer goods for Americans.
Additionally, Trump’s immigration policies could have catastrophic effects on the economy, not to mention the humanitarian and legal problems. Many of the undocumented workers, or “illegal immigrants” as Trump refers to them, come from Central or South America, fleeing violence and poverty to find jobs in the U.S. They are often working undesirable jobs at very low wages. Trump’s proposed mass deportations would hurt these industries, raise prices for consumers, and decrease economic growth. According to the American Immigration Council, mass deportations would decrease the annual U.S. GDP by 4.2–6.8% and could remove 30% of workers in major construction trades and 28% of graders and sorters of agricultural products. If Trump’s policies were enacted, food and home prices would certainly go up, increasing the cost of living for nearly every American, and undeniably increasing inflation.
While a Trump Presidency could have drastic consequences for foreign policy, democracy, climate change, education, abortion rights, and LGBTQ rights, it is plausible that his economic policies could have the most drastic consequences, and hurt everyday Americans the most. If implemented as planned, Trump’s tariff and deportation policies will indubitably raise prices of consumer goods such as food, housing, and manufactured goods, leading to increased prices for consumers across the U.S. Trump largely ran his campaign, and arguably won, on lowering inflation and deporting undocumented immigrants. If enacted, Trump’s policies will increase inflation and hurt U.S. consumers and most Americans.
Will Sylvester ‘28 in the College of Arts & Sciences. He can be reached at sylvester.w@wustl.edu.