U.S. President-elect Donald Trump has shown that crude slogans make for catchy headlines. But where will we first see the pragmatic side of the new president, Swiss U.S. expert Alfred Mettler asks in his exclusive essay for finews.first.

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As the fog begins to lift after a surreal month in the U.S. – as well as the rest of the world – it has become apparent that Donald Trump didn’t just win the election, but now has to form a cabinet, an agenda for his government, and an administration containing several thousand people. Recounts, suspected cyber attacks and conspiracy theories likely won’t do anything to change this result, and seem to be perceived as the almost «expected» fallout from a modern election.

The president-elect does not seem to have given much thought to the implications of his potential victory ahead of November 8. Thus, his «transition team» is reacting with a sense of urgency, knowing that the clock is ticking until the presidential inauguration on January 20, 2017. So far, only a few appointments have been made public – but it has already become clear that Trump won’t be avoiding the «Washington swamp,» and certainly won’t be «draining it,» as alluded to in his speeches.

«It was always clear that Hillary Clinton won't be going to prison»

After all, Trump can’t ignore the interests of the Republican Party. While Jeff Sessions serving as Attorney General would be a radical change, having Mitt Romney as Secretary of State would help to partially restore the balance. Of course, it will be difficult to make actual predictions about his future government policies until after Trump has announced his entire Cabinet and it has been confirmed by the Senate.

During the elections, Trump has shown that crude slogans make for catchy headlines. In this case, the means justified the end. It was always clear to him that cement mixers won’t show up along the entire stretch of 3,200 kilometers dividing the U.S. from Mexico, and that Hillary Clinton won’t be going to prison. Likewise, plans to impose a 40 percent tariff on Chinese imports were just as much for show as were his promises to completely rip up Obamacare legislation.

«Achieving both and also lowering deficits is a fantasy»

While Trump does have a bit more leeway in regards to free-trade agreements, the reality is that he will need to begin acting pragmatically sooner rather than later. It should be relatively easy to opt out of TPP, the Trans-Pacific trade partnership (despite such a move being geopolitically short-sighted and highly problematic), and simply give up on TTIP, the trade agreement with Europe. But negotiations about NAFTA will be a much tougher task, not to mention WTO (of which the U.S. is a leading member).

Thus, the parts of his (rather vague) candidacy which Trump can actually follow through with are quite limited. For instance, he has promised to boost the economy through a stimulus program providing better jobs and higher wages, while also pushing for lower taxes and cuts in budget and state deficits. But elementary mathematics show that this type of «economic nirvana» is impossible to achieve.

Of course, investments in infrastructure are desirable and necessary, and promises to cut taxes are usually popular among voters. But achieving both and also lowering deficits is a fantasy – especially given the current state of the world economy and the low global growth rates.

«We can’t expect too much change in doctrine»

Higher deficits have also long been considered appalling by the majority of Republicans. It will thus be interesting to see just how Trump and the Republican Party will manage to disentangle this Gordian knot.

So where will we see the new president make his mark first? He will likely be able to claim the measures already announced regarding the TPP and TTIP free-trade agreements as «quick wins.» He will also be able to appoint a successor for the seat on the Supreme Court currently vacant following the death of Antonin Scalia, opening up an opportunity for the radical wing of his party.

But as Scalia was the most conservative of the nine judges and his successor will likely come from a similar background, we can’t expect too much change in doctrine.

«Trump will announce many changes, but he will only be able to implement some»

However, should more judges need to be replaced during Trump’s tenure (which can only happen due to retirement, impeachment, or death) – new appointments could influence a conservative legal shift.

Such a shift wouldn’t be easily reversed, and could have long-lasting influence on the country. Yes, Democrats could always delay the appointment of judges and potentially even soften the blow by filibustering in a Republican-dominated Senate. Or they could potentially soften the blow through smart negotiations with the Republicans. Nevertheless, they wouldn’t be able to block any appointments.

Trump will announce many changes, but he will only be able to implement some. In the energy sector he may enforce his «America First» doctrine – potentially questioning or even cancelling conventions on climate change, allowing the exploitation of natural resources in (now) protected areas, and relaxing rules on the preservation of the environment.

These are all acts which he could then use for PR-purposes and which may help to satisfy parts of his voter base. He could also create jobs through infrastructure projects, which would get the media’s attention. But to do this, he would need the approval of Congress, and have to grapple with time-consuming political procedures – processes he isn’t used to.

«Donald Trump is expected to mainly focus on generating maximum-publicity headlines»

Many aspects about the new government remain unclear so far, especially as Donald Trump is expected to mainly focus on generating maximum-publicity headlines, while leaving the daily routine work to others.

Although the American system is robust enough to survive the Trump presidency, the uncertainties and volatilities created by him will accompany him throughout his tenure. That’s probably the only thing certain today.

Alfred Mettler is Professor of Finance at Georgia State University (Atlanta, USA) and Swiss Finance Institute Adjunct Professor. He grew up in Switzerland and was a faculty member of the Swiss Banking Institute at the University of Zurich before moving to the U.S. in 1998. He has leading roles in several Executive Education Programs in Europe and the U.S. and has consulted for various companies and organizations.

In a broader context, Mettler often comments on financial, economic, political, and societal developments in the U.S., Switzerland, and Europe. He regularly gives public speeches and presentations, and he is a frequent contributor to the Swiss and the U.S. media.

Previous contributions: Rudi Bogni, Adriano B. Lucatelli, Peter Kurer, Oliver Berger, Rolf Banz, Dieter Ruloff, Samuel Gerber, Werner Vogt, Walter Wittmann, Alfred Mettler, Peter Hody, Robert Holzach, Thorsten Polleit, Craig Murray, David Zollinger, Arthur Bolliger, Beat Kappeler, Chris Rowe, Stefan Gerlach, Marc Lussy, Nuno Fernandes, Claude Baumann, Beat Wittmann, Richard Egger, Maurice Pedergnana, Didier Saint-George, Marco Bargel, Steve Hanke, Andreas Britt, Urs Schoettli, Ursula Finsterwald, Stefan Kreuzkamp, Katharina Bart, Oliver Bussmann, Michael Benz, Peter Hody, Albert Steck, Andreas Britt, Martin Dahinden and Thomas Fedier.