Trumponomics: The Impact of Trump's Economic Policies

Trumponomics is a term that has emerged as a result of the economic policies implemented by President Donald Trump between 2017 and 2021. It mainly includes a series of tax reforms, protectionist measures, and changes in international trade that have had a significant impact on both the U.S. economy and the global financial system.

One of the main elements of Trumponomics was the 2017 tax reform aimed at reducing taxes for corporations and individual taxpayers. The main objective was to stimulate economic growth by increasing capital in companies and individuals, which could have an impact on job creation and increased consumer spending. This reform generated widespread public outcry because its main beneficiaries were large corporations, while for most of the middle class, the benefits of the reform were limited.

Another important part of Trumponomics is protectionism, which has manifested itself in the imposition of tariffs on imports, primarily Chinese goods. President Trump claimed that by doing so he would protect American jobs and force other countries to rethink their trade practices. This has led to trade wars, especially with China, which has affected global supply chains and increased the prices of many goods.

In addition, Trump has worked aggressively to loosen regulations on businesses, which he believes was meant to spur economic development. The loosening of environmental and financial standards has been criticized by environmentalists and progressive economists, but Trump's supporters have argued that it has helped spur growth in the U.S. economy.

Trump's economic policies have also concerned monetary policy. Despite his criticism of the Federal Reserve for high interest rates, the U.S. economy as a whole showed growth, although some analysts argued that this growth was artificially supported by tax cuts and increased government debt.

Foreign Trade

Under Donald Trump's first term, foreign trade has become one of the main focuses of his economic policy. The US president actively promoted the idea of “America First”, which meant trying to bring jobs and industrial production back to the country through increased protectionist measures. Trump has stated the need to renegotiate international trade agreements to better suit US interests. One key step was to renegotiate the North American Free Trade Agreement (NAFTA), which was replaced by a new agreement, the USMCA (United States-Mexico-Canada Agreement).

Trump has been particularly focused on trade relations with China, where he claimed that Beijing manipulates the currency and uses unfair trade practices. In 2018, he initiated a trade war with China by imposing high tariffs on Chinese goods, which led to retaliatory measures from the Chinese side. These measures elicited mixed reactions as, on the one hand, they attempted to protect American jobs and industry, but on the other hand, they made it more difficult for American companies to access the Chinese market, raising the price of goods and creating uncertainty for businesses. The two sides eventually reached the first phase of a trade agreement in 2020, but the effects of this war continued to be felt throughout his presidency.

Fiscal Policy

Donald Trump's fiscal policy was focused on stimulating economic growth through reducing the tax burden on corporations and individual taxpayers. In 2017, a major tax reform was passed that reduced the corporate tax rate from 35% to 21%. This measure, according to the Trump administration, was supposed to stimulate investment in the economy, increase jobs and improve the competitiveness of American companies. At the same time, tax breaks were also introduced for individuals, although they were temporary, unlike corporate tax breaks, which drew criticism because most middle-class taxpayers did not feel the significant changes.

However, these measures also increased the budget deficit and public debt. The decline in tax revenues was not offset by sufficient cuts in government spending, raising concerns among economists about the long-term effects on the country's financial stability. While proponents of the reforms argued that the tax breaks would boost the economy and increase tax revenues by broadening the base, critics pointed out that the benefits of the reforms were mainly for the wealthy and large corporations rather than the general public.

Trumponomics has become an important element of U.S. economic policy, with a significant impact on both the domestic economy and international trade relations. Tax reforms and protectionist measures aimed at reducing the tax burden on companies and attempting to bring jobs back to the U.S. have generated widespread public outcry. 

While these measures have boosted the economy and improved some indicators in the short term, the long-term effects remain controversial. Increased government debt, instability in international markets, and rising trade barriers could cause difficulties for the U.S. economy in the future. Trumponomics, with its focus on the national interest, has highlighted the importance of protecting domestic industries, but has also demonstrated the difficulties countries face in a globalized economy.