The president-elect’s tax plan—reducing the number of tax brackets, repealing the 3.8 percent healthcare tax, and eliminating the alternative minimum tax—will find favor with Congressional Republicans focused on marginal tax rates. However, plenty of Republicans worry about the deficit, which would grow under the Trump plan. As a final nail in the tax plan’s coffin, Democrats will have enough Senate votes to prevent passage of this legislation.
Trump also proposed more spending in some areas, such as infrastructure, and that’s likely to be implemented. How we would pay for it is not likely to be a concern to either the White House or Congress, so look for rising deficits.
Congress is unlikely to terminate our trade agreements, but a President Trump can reduce the effectiveness of those treaties by challenging other countries’ compliance with the agreements. The administration will look for examples of other countries violations to use as a pretext for slapping on punitive tariffs and import restrictions. They probably won’t act quickly on this, waiting instead to see whether Congress will go along with them.