Harris Public Policy Scholars Discuss What a Second Trump Term Means for Policy

Extended tariff wars? A strategic cryptocurrency reserve? A return to a 19th-century worldview? What is the policy outlook for the second Donald Trump presidency? 

Two recent panels held at the University of Chicago Harris School of Public Policy tackled the question in real time, convening to discuss domestic and foreign policy just before and after Trump returned to the White House Jan. 20. Part of a Harris series exploring the policy implications and landscape of this Trump presidency, the two January events followed December’s kickoff panel centered on the economy. Shortly after that event, Trump nominated panelist Casey Mulligan, a UChicago economics professor, as chief counsel for the Small Business Administration Office of Advocacy.

The foreign- and domestic-focused panels—featuring Harris Public Policy faculty and Ethan Bueno de Mesquita, dean and Sydney Stein Professor at Harris—covered a lot of ground, with pointed and thoughtful debate and insight into why it’s so hard to forecast what a president called “predictably unpredictable” will do.  

Here are highlights:

Tariffs

Trump’s Feb. 1 tariff moves targeting China, Mexico, and Canada came after the Harris School domestic policy event. But panelists had discussed the likely impact of tariffs, including on gas prices. “We import four million barrels a day of crude oil and refined products from Canada,”  Ryan Kellogg, the Ralph and Mary Otis Isham Professor at Harris, said. “Most of that comes here to the Midwest or to the Rocky Mountains. It is going to be titanically disruptive if those tariffs are put in place all of a sudden. We're going to see higher gas prices for several years at least and the supply chain readjustment is going to cause tremendous losses for our ally Canada.”

War in Ukraine

Just before panelists gathered for the Jan. 22 foreign policy event, Trump posted on Truth Social that it was time for Russian President Vladimir Putin to "Settle now, and STOP this ridiculous War!” Trump, said Konstantin Sonin, the John Dewey Distinguished Service Professor, sees ending the Russia-Ukraine war as a direct route to winning the Nobel Peace Prize. That’s a prize Trump is determined to win, Sonin said, because of his “eternal race” with former President Barack Obama, who won the prize in 2009. Trump’s desire for the prize is larger than any admiration he has for Putin, Sonin said; he will search for a solution to end the war.

Cryptocurrency

Trump has vowed  to create a bitcoin “strategic reserve” and to make the United States the world’s "crypto capital.” The latter is “extraordinarily dangerous,” Steven N. Durlauf, the Frank P. Hixon Distinguished Service Professor at Harris, said at Jan. 14’s domestic-focused panel, which was moderated by Associate Professor Wioletta Dziuda. Durlauf described the first Trump administration as “the advocate of reduction of oversight,” and said he expects this second term to lead to fewer of the efforts governments make to set financial institutions’ capital and liquidity requirements to avoid some of the most harmful consequences of crashes. Calling Trump’s boosting of the cryptocurrency industry, “extremely unwise,” Durlauf said, there is no data on cryptocurrency’s risk properties. Back in 2008, he noted, that same lack of data existed for subprime mortgages.

An outstanding 19th century president

Paul Poast from UChicago’s Department of Political Science, explored what he described as Trump's fascination with William McKinley, who was president from 1897 until 1901 and who, Trump said at his inauguration, “made our country very rich through tariffs.” “McKinley’s imperialist policies — the U.S. annexed Hawaii and the Philippines and declared war on Spain during his administration — are echoed in Trump’s talk about Panama and Greenland, Poast said. “One way I can think about a unified theory of Trump's foreign policy,” Poast said, is to say Trump “is going to be an outstanding 19th century president.” 

Regulatory reform 

During discussion about energy and environmental policy, Kellogg said he was cautiously optimistic about the possibility for regulatory reform during this Trump administration. The current regulatory structure, he said, is a roadblock for firms that want to make investments in the sectors while being mindful of environmental protections and giving local communities a voice. “Environmental reviews by the federal government can take as long as five years-plus,” he said. “Plus, there's a six-year period after that where … parties can litigate ex-post. If you're a firm interested in making these investments in infrastructure, that is obviously a really big problem.”

Middle East

Foreign policy event panelists dug in on a  range of Middle East issues: Gaza, Iran, the warming relations between Saudi Arabia and Israel, and the Abraham Accords, the 2020 agreements that normalized diplomatic relations between Israel and several Arab nations. “If there's a signature foreign policy accomplishment of the first Trump administration, one that he received a lot of credit for and that the Biden administration continued, it was the Abraham Accords,” Poast said, adding that Trump wants to see the accords continue as a balance against Iran. There is “a tremendous amount of human suffering happening on the planet right now associated with one military that has used its proxy forces globally. And that’s Iran,”  Associate Professor Austin Wright added. “I think that the Trump administration is taking very seriously the threat that that poses as is Israel.”

Social programs 

Emphasizing that he was speaking as a citizen, Durlauf said there were many policies that Trump has promoted in the past, and likely will again, that he did not support, such as cuts to programs like SNAP (formerly food stamps). “If you look at the previous Trump administration, every time there was a budget he tried to cut aid to the disadvantaged,” Durlauf said. “That's not the society I want to live in.” 

“America First”

“If you were trying to calculate the Trump Doctrine, or at least what he's trying to propose as a doctrine, it is ‘America First,’”  Wright said. “It's a transition to very transactional policies,” he said adding: “Why are we withdrawing from the Paris Accords? Because of concerns about the impact of those accords on American workers. Why are we withdrawing from the World Health Organization? [Because of] concerns about management of the pandemic, and specifically how it affected the United States. When we think about a lot of the changes that occurred during Trump 1 and likely will occur under Trump 2, it really is about putting the United States’ position first on the global stage.” 

Education policy

Associate Professor Lesley Turner, said she had to “dig deep” to find reasons for optimism about this Trump presidency and education policy. But she said she thinks there are opportunities for low-profile, bipartisan policies that could have a meaningful impact on students. They include the College Transparency Act, which would create a nationwide database tracking students into college through college and into the labor market, providing a tool to provide transparency about success rates. As for Trump’s campaign talk about returning education to the states, Turner said that “there isn't going to be a huge amount of change that is even possible.” The majority of funding for K-12 education comes from state and local sources. “The federal government's role in K-12 education is pretty minimal,” she said.

“Predictably unpredictable” 

“Some people say that Trump is hard to nail down,” Poast said. “And I say, ‘actually he's quite predictable.’ He's predictably unpredictable. You never really know exactly where he stands on things. He's notorious for doing the last thing that he heard. So, if you can be the last person in the room and tell him something, then that's likely going to be the policy.”