Where Donald Trump can act unilaterally on his campaign promises — and where he will need Congress
11/06/2024 20:06
Donald Trump made a wide array of promises on the campaign trail. Some of them will be easier for him to do by himself than others once he takes office in 2025.
Donald Trump made a wide array of promises on the campaign trail in recent months that he will now need to implement after a decisive victory set him up for a return to the Oval Office in 2025.
Some of them will be easier for him to do by himself than others.
On two of his signature promises — a new wave of tariffs on imports from around the world and a "mass deportation" of undocumented immigrants — an American president is imbued with considerable authority to act unilaterally.
And Trump has given every indication he intends to try. In a speech early Wednesday morning, Trump said "America has given us an unprecedented and powerful mandate" and promised to move quickly.
Other priorities will require more partners. The still unsettled picture of who will control the House of Representatives will shape what Trump is able to implement on issues like tax cuts and a rollback of green energy credits.
The control of the House is still up for grabs as of Tuesday morning, according to AP projections, with over 50 races still to be called.
Republicans also took control of the Senate on Tuesday night, meaning that if they can eke out a win in the House, they would largely have complete control over Washington's levers of power.
Trump spent much of the campaign promising to enact his tariff ideas "quickly" and a series of moves by Congress stretching back decades could allow him to do that.
It is Congress that formally — per the US Constitution — has the power to "lay and collect Taxes, Duties, Imposts and Excises." But lawmakers have ceded much of that power to the Oval Office in a series of bills that stretch back decades.
The so-called "Section 301" and "Section 232" tariff authority that has been exercised in recent years by both Trump and President Joe Biden are based on some of these bills. They have allowed both men to enact tariffs via a process that can be timely — requiring a review process by the Commerce Department — but with little outside input.
Trump allies have also talked in recent months about testing presidential power further on other untested options, such as a long forgotten 1977 law called the International Emergency Economic Powers.
That could be dusted off and would perhaps allow a president to act even more quickly and impose higher duties than his other authorities.
The question many experts ask is whether courts — not Congress — will intervene. "He would almost certainly be sued by somebody," noted William Reinsch, longtime trade policymaker in an interview earlier this year. Whether a judge would agree and intervene remains to be seen.
The president also has considerable unilateral authority on immigration.
The president-elect has promised what he calls "mass deportations" of perhaps millions of undocumented immigrants and is expected to call on agencies of government he will soon control from the U.S. military to diplomats to turn that promise into a reality.
In addition to the humanitarian crisis such a move could provoke, it could also have an economic cost.
A note from Capital Economics late Tuesday night outlined some of the worries. The authors said they expected Trump to push forward on his proposed immigration curbs and tariffs. They said that as a result, "we are minded to reduce our GDP growth forecast ... by roughly 1% and add 1% to our inflation forecast over the same period."
Presidential administrations of course have widespread authority to act in countless other areas that will be felt across the economy, from approving mergers to adding or subtracting regulations.
Trump will also be atop an intense tax debate that policymakers will be wrestling with in 2025 over whether to extend tax cuts that Trump himself signed into law in 2017.
What Trump has promised is a complete extension of the cuts for individuals of all income levels, alongside a dizzying array of additional promises from no taxes on tips and overtime to lowering taxes for big business.
That's likely to cost somewhere in the neighborhood of $9 trillion, according to the Committee for a Responsible Federal Budget.
Whether Trump can act will depend on the makeup of Congress — in other words who is across the negotiating table from him.
If Democrats end up with control of the US House of Representatives next year, they will likely be able to pare that tax agenda down significantly and also make it into a longer process of bipartisan back and forth.
But if Republicans win control of both the House in addition to their newfound control of the White House and the Senate — the so-called trifecta — then the GOP will largely be able to only negotiate among themselves.
House Speaker Mike Johnson has openly talked in recent months about how Republicans hope to use Congress's reconciliation process to act quickly, perhaps within Trump's first 100 days, to move on a tax bill if they have complete control and the power to do so.
Another key area of where Trump will need Congress has to do with some of his promises to repeal green energy credits that Biden signed into law.
In a recent Wall Street Journal interview, billionaire financier John Paulson — a possible Trump Treasury secretary — said that his particular focus if he is installed would be on gutting the IRA and eliminating green energy subsidies.
While such a move could save the US government about $921 billion over the coming decade, Trump would almost surely need control of Congress to follow through.
Ben Werschkul is Washington correspondent for Yahoo Finance.
Every Friday, Yahoo Finance's Rachelle Akuffo, Rick Newman, and Ben Werschkul bring you a unique look at how US policy and government affect your bottom line on Capitol Gains. Watch or listen to Capitol Gains on Apple Podcasts, Spotify, or wherever you find your favorite podcasts.
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