If Donald Trump wins his bid for a second term as president of the United States, he’ll look to implement a plan that could result in the elimination of thousands of federal jobs.
Those involve career bureaucrats involved in the regulation of the seafood industry and food safety, warned Mark Blyth, a professor of international economics at Brown University’s Watson Institute for International and Public Affairs, who delivered the keynote address at the 2024 Seafood Expo North America in Boston, Massachusetts, U.S.A. on 10 March.
“He wants to replace the top 50,000 civil servants; that is to say you take everybody in all these [federal] departments who could be a blockage [to his agenda], and you put them on what's called Schedule F, which [provides] the jobs, the same benefits. But, you can be fired at well. So, let's say you work at the FDA or the EPA – people who, for example, are the ones requiring monitors on fishing boats and making the fishermen pay for it, which has turned into a Supreme Court case – and Schedule F is instituted. You might be a little bit more hesitant to block government policy under the circumstances,” Blyth said. “You might not think this is going to be a big deal but would be a huge deal.”
The conservative think tank Heritage Foundation released a plan in September 2023 that detailed how a second Trump administration could gut the federal bureaucracy. Blyth said the move would result in deregulation and the cutting of red tape, resulting in an economic boost, but it could also be dangerous for consumers as federal agencies lose the manpower they need to effectively staff food safety agencies and other vital programs.
“Very few superpowers advanced their own interest by hollowing out their own state capacities, which is essentially what we're setting out to do. For better or worse, that's what it's going to be,” he said. “I like to know when I'm drinking arsenic.”
The 2024 U.S. election is “the only globally significant election,” providing both an unpredictable result and drastically divergent repercussions depending on the outcome, according to Blyth.
For example, U.S. President Joe Biden has pledged to defend Taiwan in the case of a Chinese invasion and has vowed to continue supporting Ukraine following its invasion by Russia, whereas Trump – his presumptive opponent – has been noncommittal. Blyth accused Biden of “writing checks that we can't cash,” arguing a defense of Taiwan and the Baltics under the terms of NATO is impossible without catastrophic, untenable losses for the U.S.
“Are we going to actually fight that fight? No,” Blyth said.
The two candidates appear to be more aligned on trade, however, with Biden continuing most of the tariffs Trump placed on Chinese goods. But, Blyth said Biden hasn’t shown an interest in further ramping up tariffs, while if Trump is elected, he is talking about implementing a 10 percent general tariff and 60 percent special tariffs against China.
“I don't know if that's just talk, but the thing they say about Trump is, ‘Take him seriously but not literally.’ So, I don’t know if that’s to be taken seriously, but what happens if you do that? Everyone puts up tariffs on the other side,” Blyth said. “There are no winners on this one, particularly if you're in an industry like seafood that’s super dependent on imports. Tariffs only make sense if you can make up the difference with domestic production, and you just can’t do that in the U.S. with seafood.”
Furthermore, Trump is nearly certain to fire U.S. Federal Reserve Chair Jerome Powell, whom he appointed in 2017, according to Blyth. With a few other seats on the Federal Reserve board coming open, Trump has the ability to push the U.S. toward a fiscal policy of low interest rates while he pursues legislation providing large tax cuts.
“You can look at a more politicized [Fed], which means long term, you're building up inflation and eventually a depression has to happen.”
The future of the U.S. immigration system is also likely at stake in the upcoming election, with both Biden and Trump pushing for cutbacks to the influx of foreigners coming into the U.S., but Trump has called for a much more expansive limitation of immigration, with further implications for the country’s economy.
“[More Americans] don't like immigrants anymore, and no matter who's coming into the United States, that’s getting tightened up,” Blyth said. “With the baby boomer generation now retiring, that's a lot of people who really held U.S. industries together for a very long time leaving the workforce; there's very little we can do in terms of replacing those types of skilled workers, particularly with a shortage on the immigration front.”
A declining labor supply means costs will go up and could provide a further impetus to the adoption of automation and reliance on other technology, such as artificial intelligence. Blyth has previously called AI a gamechanger for the global economy.
Separately, Blyth predicted the U.S. Federal Reserve will “declare victory” when inflation levels hit 2.5 percent, countering a theory presented by 2023 SENA keynote speaker Megan Greene, who predicted the Fed would adjust its annual inflation target to 3 percent.
“They're going to start dropping [interest] rates quite strongly in the next year, and part of the reason they're doing this is they want to stabilize the dollar from going up too far and stop the government from going bankrupt by basically lowering the yield that the country is paying on its debt,” he said.
As for the rest of the world, Blyth said Asia will account for the majority of global growth in coming decades.
“It’s so diverse, and it's where all the population growth is. It's where the economy of the 21st century is going to end up. It’s where climate change will be decided. That's just the reality of it,” he said.
Blyth acknowledged his shortcomings as a prognosticator, however, as well as the predilection of many economists to create “toy models” that don’t account for the complexity of the real world.
“The West is terrible at understanding anyone who's not them. We just pretend everyone's like us, and then we get shocked when they're not,” he said. “There's so much that we don't know and we don't get right.”
One thing Blyth is pretty sure of, though, is that there is a lot of anger driving decisions both in U.S. elections and global geopolitics.
“I study why, in the aggregate, at least, the world's never been richer, and yet we seem to be never more pissed off with one another than we've ever been,” he said. “[I think] that’s something worth getting to the bottom of, and I think there’s an economic explanation for what's going on.”
