He would cut taxes, repeal the Affordable Care Act, build roads and build walls — a real one against Mexican immigrants and a tariff wall against unfair imports. President-elect Donald Trump’s agenda for America will make a difference in the lives of many people and change the way St. Louis does business — if he can pass it.
That may be difficult. Some things he wants to change, such as Obamacare and the North American Free Trade Agreement, are enshrined in law, notes Ken Warren, political science professor at St. Louis University. Trade issues, among other things, put Trump at odds with leaders of his own party.
Presidents have lots of power in foreign policy, but much less authority at home, notes Warren, a scholar of the presidency. To do most important things, Trump needs to win over Congress, including some Democrats in the Senate, and a sometimes recalcitrant federal bureaucracy.
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“What we’ve found is that the president usually doesn’t make much of a difference,” said Warren.
Here’s a rundown on what Trump wants to do and how it might affect St. Louis.
Health care
Trump has repeatedly promised to repeal and replace President Barack Obama’s health law, but he may find that easier said than done. Complete repealing or replacement would take 60 votes in the Senate, and the GOP will have only 51 senators on Inauguration Day.
Under Senate rules, those 51 votes are enough to cut funding for Obamacare insurance subsidies and Medicaid expansion. But repealing the subsidies without repealing the law would probably cause complete collapse in the market for individual health insurance, says Tim McBride, a professor at Washington University’s Brown School of Social Work and Public Health.
About 20 million people would likely lose coverage with repeal, he notes, and many of them are sick. “You’re going to start hearing horror stories,” McBride said.
Defunding would also set off a “death spiral” in the individual health insurance business, says McBride, prompting cries from millions of self-employed people, early retirees and others who get no Obamacare subsidy at all.
The Affordable Care Act forbids insurers from excluding sick people, or charging them more. Those restrictions would remain even if funding was cut, notes McBride.
As subsidies disappear, healthy people would be more likely to drop their insurance, leaving insurers with a sicker, more expensive pool. That would cause premiums to skyrocket and insurers to abandon the market.
Trump might find enough votes to change or replace the ACA, rather than repeal it.
“You’re going to see a willingness on the part of many of us to work with President Trump, as long as he has a replacement” for the law, said Sen. Claire McCaskill, D-Mo.
Trump on Friday indicated that he would be amenable to a deal. “Either Obamacare will be amended, or repealed and replaced,” Trump said.
In an interview with the Wall Street Journal, he said he wants to keep the prohibition on denying insurance coverage because of pre-existing conditions and the ability of parents to keep adult children on their company insurance plans.
Any replacement must make sure that people with pre-existing conditions can still get coverage, McCaskill said. “I don’t want to go back to the days when everybody was at the mercy of the insurance companies,” she said.
Outright repeal would prompt howls from the politically influential medical establishment, which would lose a way of getting paid.
That means more cost-shifting, said Mike Peters, vice president for government affairs at Chesterfield-based Mercy Health. “If you have individuals that are treated without any form of payment, the cost of operating that facility is shifted onto the patients who have the ability to pay,” he said. So premiums for employer-sponsored insurance could rise.
One major local employer — Centene Corp. of Clayton — has already taken a hit. Centene, which manages Medicaid programs for the states, has seen its stock slide 24 percent since the election.
The ACA greatly expanded Medicaid coverage in 32 states that agreed to participate, providing work for Centene. Missouri opted out.
McBride, who consults with Congress on rural health issues, says Republicans in Congress understand the danger in repealing the ACA, and will likely try to work out compromises to bring enough Senate Democrats along.
“They say they want to dismantle it, but they’ll tweak it,” predicts Warren, the political scientist. “They are not going to cause chaos by doing away with it.”
Trump has been vague about what might replace Obamacare. He favors health savings accounts, which are usually coupled with high-deductible health plans. His “contract” with voters also favors allowing people to buy insurance across state lines and giving states more freedom to manage how they spend Medicaid money.
That fits with a broader plan issued by GOP House leadership in June. That plan, called “A Better Way,” would remove many requirements on what insurers must cover. Insurers could also charge more to people with pre-existing conditions.
People who don’t get coverage at work would get subsidies to buy plans on the open market. The government would also subsidize high-risk insurance pools for those who can’t get other coverage.
Republicans would give states a set amount of money to pay for Medicaid, which would limit the cost of the insurance program for the poor. But states would get more freedom in how to spend it.
Trade
St. Louis buys from the world and sells to it — and Trump may influence both.
Trump made trade a major issue, blaming the North American Free Trade Agreement for causing “devastation” in the Midwest. He wants to renegotiate the deal and cancel it if Canada and Mexico won’t go along.
He pledged to brand China a currency manipulator, and has threatened tariffs of 45 percent on Chinese imports and 35 percent on some Mexican products.
His complaints might resonate with roughly 1,500 workers who were laid off early this year from United States Steel’s Granite City Works. The big steelmaker cited unfairly cheap imports from Asia as one reason for the mill’s partial shutdown, although a fall in demand for steel pipe from the suffering U.S. oil industry was a major cause.
Jefferies, an investment firm, upgraded U.S. Steel stock to a buy after the vote, saying it should benefit from Trump’s trade policies.
The Obama administration has been listening to Big Steel. The industry’s victory in an anti-dumping case last spring saved nearly 500 jobs at the Granite City mill. U.S. Steel kept its finishing line open because the government imposed penalties on Asian imports, noted Dan Simmons, president of United Steelworkers Local 1899 in Granite City.
Simmons wonders if Trump can really succeed in cracking down on unfair imports, noting that Republicans in Congress tend to support free trade agreements.
While steel suffers, other St. Louis companies live by exporting. Local firms shipped $8.9 billion in products abroad last year, with $3.5 billion of that shipped to Canada and Mexico, partners in the NAFTA accord, according to the Commerce Department. Exports worth $4.4 billion went to Asian nations covered under the proposed Trans-Pacific Partnership trade pact, which Trump opposes.
Chemicals are the metro area’s biggest export, followed by electronics, transportation equipment and machinery.
Any move to boost U.S. tariffs would bring “very quick and very decisive retaliation” from foreign nations, says Paul Christopher, head global market strategist at Wells Fargo Investment Institute. “That’s going to be a real problem if President-elect Trump is serious about trade restrictions.”
“If he begins to get in a trade war with a lot of countries, American jobs will suffer,” McCaskill said. “We really don’t know what he means because he has said so many different things.”
That worries David Shogren, CEO of U.S. International Foods in Grand Center. The tiny company exports American food products to China, and a trade war would hurt his business.
“I was in China last week and talked to a lot of customers about nuts,” he said. The Chinese can buy cheaper nuts from Vietnam than from him because a trade agreement lowers tariffs between those nations.
“The U.S. is on the outside looking in,” he said. “I’m quite concerned because his rhetoric has been so anti-China and anti-trade.”
Boeing Co., one of the region’s biggest exporters, might feel both pain and gain from Trump policies.
It builds fighter jets in St. Louis, both for the Department of Defense and for export to Australia and the Middle East. Boeing, which employs nearly 15,000 people in metro St. Louis, just finished a new plant in north St. Louis County to make wing parts for its new 777X airliner.
Trump’s plan to boost defense spending might aide Boeing on one side of its business, while a trade war would hurt its commercial sales.
Some of the 777X planes would be sold to Iran under a recent agreement. During the campaign, a Trump press release complained about the Iran sale, saying that “the world’s largest state sponsor of terror would not have been allowed to enter into these negotiations with Boeing without Clinton’s disastrous Iran Nuclear Deal.” The GOP-led House has also moved to block the sale.
Taxes
Prospects for tax reform seem bright under Donald Trump. House Republicans were working on their own tax cut plan before the election, and some Democrats find it hard to oppose lower taxes.
Trump would reduce the number of tax brackets for individuals from seven to three — 12, 25 and 33 percent — along with much higher standard deductions. The corporate tax rate would fall from 35 to 15 percent.
The middle class would see lower tax bills. Trump’s campaign estimated that a middle-class family would see a 35 percent tax cut, including new deductions for child and elder care.
But other analysts note that the largest cuts would go to the wealthy. They would see their top marginal bracket fall from 39 percent to 33 percent.
The Tax Policy Center at the Urban Institute and the Brookings Institution estimates that a typical middle-income family would see a cut of $1,010 or 1.8 percent of after-tax income. The poorest taxpayers would save $110. The richest 0.01 percent of Americans, with incomes over, $3.7 million, would get a $1.1 million tax cut, equaling 14 percent of income.
Democrats are anxious to point out the difference. “If he has a tax plan that takes care of him and his friends, he will have a great deal of trouble getting it through Congress,” McCaskill said.
She noted that House Speaker Paul Ryan has his own tax plan, “and it’s not the same.”
The Trump plan would cut federal revenue, raising the national debt, but there is debate over how much.
The Tax Policy Center puts the lost revenue at $6.2 trillion over 10 years. The more conservative Tax Foundation gets a lower number by assuming that tax cuts will stimulate the economy and put more people to work. The foundation sees the revenue loss at $2.6 trillion to $3.9 trillion.
Trump also would allow multinational companies to bring home their foreign profits from abroad at a 10 percent tax rate. That could provide a one-time revenue bonus that might be used to fund an infrastructure stimulus plan.
Still, big tax cuts, along with an infrastructure plan, would expand the national debt, which might draw opposition from Trump’s own party
“He doesn’t strike me as a fiscal conservative,” McCaskill said. “He strikes me as an opportunist.”
Environment, energy
The prospects for Obama’s landmark climate regulation, the Clean Power Plan, appear dim under President Trump, who has called global warming a hoax.
For the coal-reliant St. Louis region, efforts to mitigate carbon emissions hold big consequences. Two of the world’s largest coal companies — Peabody Energy and Arch Coal — are based here, and both filed for bankruptcy earlier as demand for the fuel fell among power plant operators and steelmakers.
Ameren Missouri generates about three-fourths of its electricity from coal-fired power plants that ring the metro area.
A Trump appointment to the Supreme Court could certainly lead to the plan being struck down, and then the U.S. will struggle to meet its commitments under the Paris climate agreement reached last year.
That in turn could make other large nations less willing to tame carbon emissions, especially if Trump follows through on statements that the U.S. won’t pay to help poor countries, like India, meet climate targets.
“This election outcome is not good news for environmental policy,” said Bill Lowry, a political science professor at Washington University who focuses on the environment. “I think the Clean Power Plan … is probably history. And I think the Paris Agreement is in a lot of trouble.”
While coal backers seemed jubilant — Peabody Energy shares jumped 50 percent Wednesday morning, even though the company remains in bankruptcy — a Trump presidency can’t reverse broader economic pressures facing the industry.
“No, there will not be a bunch of new coal plants being built just based on this election,” said Andy Smith, an analyst at Edward Jones who follows utilities.
Utilities look decades into the future to make decisions, and much of coal’s woes have been driven by cheap natural gas and more competitive pricing on wind and solar energy. Ameren, for instance, doesn’t plan to retire its Meramec coal plant in south St. Louis County until early next decade, and its long-term plans call for a new natural gas plant and wind and solar generation, not coal.
Peabody, for its part, said its strategy remains the same: focus on the development and funding of high-efficiency, low-emission coal power plants and carbon capture technologies that would make coal viable for the long term.
That being said, Peabody spokesman Vic Svec says, “It’s good to see coal being recognized as an essential part of the energy mix.”
Urban policy
Like most of the Rust Belt, St. Louis has spent years working to revitalize an urban core hollowed out by suburbanization and deindustrialization.
Federal support for cities has been falling for decades, although the Obama administration has brought new attention to urbanism, launching several pilot programs that St. Louis seemed poised to benefit from.
Trump’s support largely came from unexpectedly high turnout in rural areas, and city voters across the country largely backed Democratic nominee Hillary Clinton. If traditional political calculus holds, cities may be not be a high priority under the president-elect.
“You reward your base,” said Todd Swanstrom, a professor of public policy at the University of Missouri-St. Louis who focuses on urban issues. “He’s not going to send resources to cities per se, but that’s a generalization.”
Trump has called for more tax incentives to spur inner-city development, and has said he wants to ease access to bank credit for blacks trying to start businesses in urban areas.
However, he will be working with a Congress dominated by traditional conservatives who often hail from nonurban areas. They aren’t likely to allow deficits to explode if Trump pushes for large tax cuts and a big infrastructure spending bill.
When Republicans control the White House and Congress, funding for cities through Housing and Urban Development has suffered in order to make room for tax cuts, said Sarah Coffin, a professor of urban planning and development at SLU.
“What I would expect to see happening is a lot of that stuff will be shifted back to a block grant approach, which is much easier to whittle away at to make room in your budget,” she said. “They’re going to have to be much more resilient at the local level figuring out how to do more with less.”
Areas most ravaged by the loss of jobs and investment — north St. Louis and north St. Louis County — have been included in a federal “Promise Zone” that moves St. Louis and local organizations up in line for federal grants.
And the city was recently named a finalist for a federal Choice Neighborhoods grant that could pump $30 million, and leverage millions more, into neighborhoods north of downtown near the planned new western headquarters of the National Geospatial-Intelligence Agency.
“They were kind of pilot programs that if there were a Democratic and urban majority in Congress, I would have expected them to be expanded,” Swanstrom said. “There’s not going to be much time left. So I fear that St. Louis is going to lose out, because we were really looking good for Choice.”
Trump has also called for additional funding for police, which could mean more money for police departments. St. Louis has struggled to find money for additional police officers to help manage an uptick in the homicide rate over the last two years.
Coffin said police funding needs to include money for training if cities across the country hope to better connect with and police black communities that have grown increasingly estranged from law enforcement in the wake of high-profile police shootings.
“Will this money only be used to buy police cars and to buy riot gear and to hire police officers?” Coffin said.
Infrastructure
One of Trump’s campaign promises has been a call for a massive, $1 trillion infrastructure spending bill.
That has some regional leaders hopeful an older postindustrial city like St. Louis will be able to fund some big priorities.
“We’re encouraged by the words of the president-elect, and I think it could be a very good thing for our region,” said Bi-State Development President and CEO John Nations.
Bi-State operates public transit in the region and coordinates the new St. Louis Regional Freightway, which aims to boost St. Louis’ standing as a logistics hub.
The Freightway’s infrastructure priorities include replacing the Interstate 270 bridge over the Mississippi River and widening the highway there to six lanes.
The top priority to boost the region’s freight capacity is replacing the 128-year-old Merchant’s Bridge rail crossing, which Nations called “a bottleneck to growth.” Only one train can cross the bridge at a time because of its age, and demand is high to move goods across the Mississippi River.
A big boost in infrastructure spending that appears to have a chance with Republican control of Washington “could be particularly good news here in St. Louis as we work on the St. Louis Regional Freightway,” he said.
Prospects are less clear on another big project regional officials have rallied behind: a new MetroLink line that bisects St. Louis north to south. The Federal Transit Administration, which awarded Bi-State a $375,000 planning grant for the line last month, sent its top leader to St. Louis earlier this month to tour the area with Mayor Francis Slay.
Whether the feds will continue an interest in funding public transit under a Trump administration is unknown.
“I think the odds of that just went way down,” said Swanstrom, the UMSL professor. “I will say this: We don’t know his views on public transit.”
Nations agrees it’s too early to know what a Trump administration will do for public transit. He recalled that under former President Bill Clinton, a Democrat, federal funds that helped public transit systems pay for operations stopped and instead shifted to paying for capital projects.
Nations said federal funding will be necessary to cover some of the projected $2 billion cost of a new line. A St. Louis County ordinance requires federal help before local funds are used in an expansion, he said.
Because the state of Missouri doesn’t fund public transit at all, Nations adds, “we have to be concerned every year, regardless of who the president is and who the administration is.”
Republican Senate Majority Leader Mitch McConnell has already said Trump’s infrastructure plan won’t be a top priority.
“The question is, can he get Republican votes?” McCaskill said. “They were not interested in funding infrastructure under President Obama.”
Corporate mergers
Donald Trump railed against the proposed merger of AT&T and Time Warner on the campaign trail.
With corporate consolidation growing and increasing concerns from some economists over a lack of competition and innovation due to the domination of business behemoths, might a new Trump administration be pushed by his populist followers to take a harder line on mega-mergers?
“We’re at the beginning of something significant that could happen with Trump in terms of this populism,” said Maurice Stucke, a law professor at the University of Tennessee at Knoxville who worked in the antitrust division of the Justice Department. “You might have antitrust enforcement like under Teddy Roosevelt, a Republican appealing to a populist base.”
St. Louis is no stranger to the effects of major tie-ups: InBev’s purchase of Anheuser-Busch in 2008 cost the city corporate jobs and its status as a national node of advertising talent. American Airlines’ acquisition of TWA in 2001 cost Lambert-St. Louis International Airport its hub status.
“That has taken a toll on the St. Louis community,” Stucke said.
Hundreds more jobs are projected to vanish when TD Ameritrade buys Town and Country-based Scottrade. Also concerning for the region’s standing as an agriculture technology hub is the loss of Monsanto’s headquarters if Bayer wins regulatory approval to buy the Creve Coeur ag giant.
With two other mega-mergers — Dow combining with DuPont and ChemChina acquiring Syngenta — the agriculture sector is poised to be dominated by just three companies. Stucke thinks Trump’s rural base may be skeptical, and he may face backlash if he gives the mergers a green light.
“If he takes that route, and two years from now they have midterm elections, what’s the change? What’s the hope, what’s the change he’s offering to his populist base?” Stucke said.
The Obama Justice Department has already sued to block two giant insurance mergers: Anthem’s acquisition of Cigna and Aetna’s takeover of Humana.
If Republicans are serious about rolling back Obamacare, they need to retain a competitive market, said Tim Greaney, a law professor at SLU who studies antitrust law and health care.
“If you want to create vouchers for Medicare, you better have a competitive marketplace where consumers can buy health care,” he said. “It would be flatly inconsistent with the market-based alternatives that they’d apparently be considering to put the brakes on antitrust.”
Republicans are traditionally more friendly to business leaders and Wall Street, which backs mergers, but the two experts agreed that Trump’s actual philosophy is unknown. It will all depend on whom he appoints to the Federal Trade Commission and the Justice Department.
“It’s going to take strong intellectual leadership,” Stucke said.
Immigration
Perhaps Trump’s most famous campaign promise was to build a wall on the border with Mexico and deport millions of illegal immigrants.
“While there was a lot of rhetoric about immigration, the truth of the matter is some of his really large flagship proposals would be difficult if not impossible to do,” said Anna Crosslin, president and CEO of the International Institute of St. Louis, which offers adjustment services to refugees and immigrants.
Larger deportations, if they do happen, “would probably impact cities besides St. Louis more dramatically because they have larger” numbers of undocumented immigrants, Crosslin said.
However, St. Louis has benefited from refugee programs that could be scaled back under Trump. Bosnians helped repopulate neighborhoods in south St. Louis and have become a major part of the region’s cultural fabric after arriving here by the thousands in the 1990s.
The refugee crisis stemming from the Syrian civil war has led to about 271 Syrians settling in St. Louis, Crosslin said. Overall, St. Louis took in about 1,024 refugees last year after the Obama administration upped the number it said the country would accept to 85,000.
Trump has called for “extreme vetting” of Syrian refugees over concerns about terrorism, walking back his earlier proposal to ban Muslim immigrants.
St. Louis gets a little more than 1 percent of refugees allowed into the country because the region has more room than many large metropolitan areas, Crosslin said. Trump could cut back by tens of thousands the number of refugees allowed into the U.S., which Obama planned to increase to 110,000 over the next year.
That could limit population growth and the associated demand that comes with it in a region that sorely needs it for economic growth, Crosslin said.
“They are also an important source of new population to a city that has struggled from depopulation since 1950 or so,” Crosslin said. “It’s not just St. Louis. It’s Cleveland and Dayton (Ohio) and Detroit and Philadelphia and all of these former Rust Belt cities that are looking to reinvent themselves using the knowledge and talents of a multicultural workforce.”
Samantha Liss of the Post-Dispatch contributed to this report.