Trump's Return is the Death of Globalism

Put a Fork in it.. it's Done

Authored by GoldFix, ZH Edit

Intro: Trump is a Corporatist

The recently read excellent analysis entitled “The End of Reaganomics” by TS Lombard’s Steven Blitz and Grace Fan (and broken down below) encapsulates precisely what a Corporatist like Trump wishes to do. Before summarizing their work, here first and in very cursory fashion is what is meant by calling Trump a Corporatist. Defining that can help identify better how Trump’s policy decision path will cluster ideologically. Simply put, this might help observers see what drives Trump’s economic decisions. 

The ideals that steer most Corporatist economic policies:

• Nativism- Onshored supply chains

• Tolerance of Labor- at least they’re American

• Tolerance for Gov’t - libertarian by convenience

• Complete Disdain for Bank Finance- views them as rentier class

• Prefers low taxes- High taxes OK with more Corp. deductions

• Pro-manufacturing, anti-banking, creating value with real things- Lends itself to the Mercantilist world. Makes him perfect for the US during these times, if not an actual accelerationist of that model already in play

• Technology- ambivalent unless it cuts costs for real thing-making (makes him money), or disintermediates banks- Tech/ Crypto

• Transactionalism vs Repeat/ongoing business- Sum zero player, Mercantilism model.. a byproduct of broken trust.

• Nationalism- Patriotism as it helps all the above. Charity starts at home

There are many different styles of corporatism with varying degrees of preferences. Trump is a real estate corporatist, very old school and very anti-globalism as he views globalism and any bank financier who benefits from it as simply taking money out of his pocket while adding little to no value to creations.1

Moving on to the report...

In "The End of Reaganomics," Steven Blitz and Grace Fan assess the evolving economic and political dynamics under the returning Trump administration. The report positions Trump’s economic strategy as a deliberate departure from the globalization-focused framework of Reaganomics, transitioning instead toward domestication, disruption, and transactional policies.

This shift, the analysis argues, reflects an attempt to rebuild domestic production and middle-class jobs, leveraging tariffs, tax incentives, and a recalibrated monetary policy.

From Supply-Side Liberalization to Economic Domestication

The report outlines how the principles of Reaganomics—liberalization, deregulation, and free trade—have waned over decades. With the latest election, the analysis declares, "Reaganomics is over, and disruption begins."

Tariff Timing and Strategic Objectives

Central to the Trump administration’s strategy is its aggressive use of tariffs as both a revenue tool and a means to exert geopolitical leverage. The report highlights that "early announcements and phased execution" will likely characterize tariff policy, referencing Trump’s 2019 Mexico tariff threat as a possible model. This strategy aims to create immediate negotiation leverage while addressing fiscal deficits through duties on imports.

The report underscores three primary drivers for early tariff implementation:

1. Urgency: As a term-limited president, Trump faces a tight timeline to execute his policies.

2. Leverage: Early tariffs provide negotiating power with trading partners.

3. Litigation Risks: Rapid deployment minimizes judicial pushback that could limit tariff scope.

Tax Policy and Fiscal Trade-Offs

The Trump administration’s fiscal agenda centers on extending the 2017 Tax Cuts and Jobs Act (TCJA) while introducing new tax incentives to support domestic production. The analysis highlights proposed measures such as eliminating income tax on tips and overtime and reinstating the SALT deduction. These reforms aim to shift the tax burden from income to consumption, with tariffs projected to generate $330 billion in revenue by 2026.

The authors observe, "Trump’s approach is regressive, but it aligns with his goal of incentivizing production and spending over income." However, balancing these tax cuts against mounting deficits poses a challenge.

Monetary Policy and the Weak Dollar Strategy

The report anticipates a recalibration of monetary policy to align with the administration’s focus on production and trade. Trump’s influence on the Federal Reserve is expected to push for a weaker dollar, reversing decades of strong-dollar advocacy that began during Reagan’s tenure. As the authors point out, "The Hamiltonian era of global banking dominance is over, and the Fed will adjust to the new reality of domestic economic priorities."

Consequences of Disruption: Risks and Rewards

The analysis does not shy away from addressing the unintended consequences of this economic pivot. "Rupturing the settled global flow of goods and capital will have significant repercussions," the authors warn. Potential risks include inflation driven by private credit demand, retaliatory trade measures, and supply chain disruptions. Yet, the report also acknowledges the resilience of the American electorate, stating, "Americans’ outsized tolerance for risk defines the country’s dynamism."