What will Donald Trump’s victory mean for the economy, businesses, and financial markets? The Conversation asked four of its regular economic writers to weigh in.
Healing The Divide
Christos Makridis, PhD candidate in labor and public economics, Stanford University
In the past few months, economic policy uncertainty has been higher than it has been in the country’s history, marginally surpassing the uncertainty associated with the Great Recession, September 11, 2001, and even the Great Depression. The United States faces a number of fundamental challenges: entitlement reform, health care, economic growth, race relations, geopolitical instability in the Middle East and Russia, and environmental degradation just to name a few.
Trump’s ascendancy to the presidency fundamentally disrupts the business-as-usual tradition in Washington. While there is concern, there is also significant opportunity for genuine and long-lasting improvement, and in a bipartisan way. Motivated by the remarks in his victory speech, Trump should continue to provide an olive branch to Democrats for cooperation.
How is this done in an authentic way? Ask the other side for the top three issues that are most important to them and develop a meeting point that compromises on style but not principles. For example, while conservatives believe less regulation tends to be better than more, both parties can agree that small businesses are an important component of the economy and the government could do more to facilitate their creation and ongoing operations.
Perhaps the most salient issue that draws both sides of the aisle together is the decline of the middle class. What can the government do to help millions of people whose jobs are not experiencing wage increases or are being outsourced? The solution, in my view, is not to simply tax and transfer wealth, nor is it to stop trading with other countries.
In the first 100 days, Trump has the opportunity to craft a bipartisan plan that engages the private sector on ways to reach back out to millions of disenfranchised workers. One example of this is Skillful.com, a platform that Arizona State University is producing through the support of the Markle Foundation. The platform provides individuals with the tools and information to not only connect with jobs that are potentially more aligned with their skills but also retrain themselves with new skills, for example, by taking community college classes and pivoting into a new career. Trump can encourage these types of initiatives directly by subsidizing human capital investments and indirectly by providing the authority behind the Office of the President.