Trump's policies on immigration could have more of an economic impact than his promised tariffs

Congresswoman AOC says Trump should be impeached due to his strikes on Iran

Senior Iranian official to Reuters: “If we have to choose between stopping uranium enrichment and war, we choose war"

Iran has said: We will pursue legal action against the US attacks

US military now briefing troops that its strike on Iran "will likely result in counterstrikes on US bases and facilities" in the Middle East

A second Trump administration has the potential to bring sweeping changes to the U.S. economy, driven by proposed policies on taxes, trade, and federal spending.Economic Vision for a Second TermPresident-elect Donald Trump has pledged to implement a mix of tax cuts, tariffs, and deregulation. While these policies have sparked optimism among investors, they also carry significant risks for the economy, including inflation and increased federal debt.Tax CutsFollowing Trump’s election victory, stock markets and cryptocurrencies surged, reflecting investor confidence in a business-friendly administration. Trump has emphasized extending portions of the 2017 tax cuts, set to expire next year, and introducing additional reductions. These proposals include lowering corporate taxes and eliminating federal taxes on tipped income and Social Security benefits.The feasibility of these cuts largely depends on whether Republicans maintain control of Congress. Analysts suggest that, at a minimum, most individual tax cuts from 2017 will likely be extended.“Additional tax cuts seem probable,” noted Wells Fargo economists Jay Bryson and Michael Pugliese. They predict modest boosts to economic growth in 2026 and 2027 if such cuts materialize.Trade and TariffsTrump’s trade agenda focuses on tariffs, including a broad 10-20% levy on all imports, with even steeper rates on goods from China. While the administration argues these measures will encourage businesses to return to U.S. soil, economists warn of significant downsides.Pantheon Macroeconomics estimates that a 10% tariff could raise inflation by 0.8 percentage points in the first year and weigh heavily on U.S. manufacturers."Reshoring may be limited due to high U.S. labor costs, which still make overseas production more economical," noted Samuel Tombs, an economist with Pantheon.Additionally, tariffs could lead to retaliatory actions from trading partners, further disrupting global supply chains and increasing costs for U.S. consumers.Federal Debt and DeficitWhile tariffs might generate some government revenue, Trump’s broader fiscal agenda—including extensive tax cuts—could significantly widen the federal deficit.The Committee for a Responsible Federal Budget estimates that Trump’s economic policies could add $7.75 trillion to the national debt over the next decade. This increase would elevate government borrowing costs and exacerbate fiscal challenges, with the debt already nearing 100% of the nation’s GDP.Potential ImplicationsTrump’s proposed policies represent a mix of economic stimulus and long-term risks. Tax cuts may fuel short-term growth and investor enthusiasm, but tariffs and mounting federal debt pose significant challenges. Economists remain divided over whether these measures will lead to sustainable economic gains or create deeper structural problems in the years ahead.