Donald Trump won the US presidency with the backing of working-class and socially conservative white voters on a populist platform of economic nationalism. Trump rejected the Republican Party’s traditional pro-business, pro-trade agenda, and appealed to Americans who have been harmed by disruptive technologies and “globalist" policies promoting free trade and migration.

But while Trump ran as a populist, he has governed as a plutocrat, most recently by endorsing the discredited supply-side theory of taxation that most Republicans still cling to. Trump’s and the Republicans’ plan to repeal the 2010 Affordable Care Act (Obamacare) would have left 24 million Americans—mostly poor or middle class, many of whom voted for him—without healthcare. His deregulatory policies are blatantly biased against workers and unions.

Trump has also abandoned his base in the area of trade, where he has offered rhetoric but not concrete action. Yes, he scrapped the Trans-Pacific Partnership (TPP), but Hillary Clinton would have done the same. He has mused about abandoning the North American Free Trade Act (Nafta), but that may be just a negotiating tactic. He has threatened to impose a 50% tariff on goods from China, Mexico and other US trade partners, but no such measures have materialized. And proposals for a border adjustment tax have been all but forgotten.

Likewise, despite Trump’s aggressive rhetoric on immigration, his policies have been relatively moderate, perhaps because many of the businesspeople who supported his campaign actually favour a milder approach.

Why has his base let him get away with pursuing policies that hurt them? According to one view, he is betting that social conservatives and white blue-collar supporters in rural areas will vote on the basis of nationalist and religious sentiment and antipathy towards coastal elites, rather than for their own financial interests.

But how long can anyone be expected to support “God and guns" at the expense of “bread and butter"? The tax legislation that Republicans have rushed through Congress could prove especially dangerous, given that millions of middle-class and low-income households will not only get little out of it, but will actually pay more when income-tax cuts are phased out over time. Moreover, the Republican plan would repeal the Obamacare individual mandate. According to the non-partisan Congressional Budget Office, this will cause 13 million people to lose health insurance, and insurance premiums to rise by 10%, over the next decade.

Nevertheless, Trump and the Republicans seem willing to risk it. After all, by pushing the middle-class tax hikes to a later date, they have designed their plan to get them through the 2018 midterm elections and the 2020 general election. Between now and the midterms, they can brag about cutting taxes on most households. And they can expect to see the economic stimulus effects of tax cuts peak in 2019, just before the next presidential election.

Another part of the Republican strategy will be to use the higher deficits from tax cuts to argue for cuts in so-called entitlement spending, such as Medicare, Medicaid, food stamps, and social security. Again, this is a risky proposition. Millions of the blue-collar, socially conservative whites who voted for Trump also rely on these and similar programmes.

With the global economy expanding, Trump is probably hoping that tax cuts and deregulation will spur enough growth and create enough jobs that he will have something to brag about. A potential growth rate of 2% won’t necessarily do much to help his blue-collar base, but at least it could push the stock market up to its highest point ever.

Whatever happens, Trump will continue to tweet maniacally. But if gassy rhetoric alone does not suffice, he may decide to go on the offensive, particularly in the international sphere. That could mean truly withdrawing from Nafta, taking trade action against China and other trading partners, or doubling down on harsh immigration policies.

And if these measures do not satisfy his base, Trump will still have one last option. Namely, he can try to “wag the dog," by fabricating an external threat or embarking on foreign military adventures to distract his supporters from what he and congressional Republicans have been doing.

For example, following the “madman" approach to foreign policy, Trump could start a war with North Korea or Iran. Or he could post further inflammatory tweets about the evils of Islam, thereby driving disturbed and marginalized individuals into the arms of the Islamic State (ISIS) or other extremist groups. That would increase the likelihood of ISIS-inspired attacks—for example, “lone wolves" blowing themselves up or driving trucks through crowded pedestrian areas—within the US. With dozens, if not hundreds, slain, Trump could then wrap himself in the flag and say, “I told you so."

You know it’s time to worry when the conservative Republican chairman of the Senate committee on foreign relations, Bob Corker, warns openly that Trump could start World War III. And if you’re not convinced, consider the recent history of Russia or Turkey; or the history of the Roman empire under Caligula or Nero. Pluto-populists have been turning democracies into autocracies with the same playbook for thousands of years. There’s no reason to think they would stop now. ©2017/Project Syndicate

Nouriel Roubini is chief executive officer of Roubini Macro Associates and professor of economics at the Stern School of Business, NYU.

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