To staff his first term as president, Donald J. Trump attracted a group of largely by-the-book aides and advisers who produced an economic record — corporate tax cuts and financial deregulation — that would have been in place in any typical Republican administration.
During the campaign for Mr. Trump’s second term, however, those voices were mostly replaced by other Wall Street figures, some of whom are less orthodox in their thinking, as well as a new cohort of Silicon Valley investors jostling to upend the traditional banking system. They include the chief executive of an investment bank, Howard Lutnick, and the investors Scott Bessent and John Paulson.
Also out: any certainty that the incoming Trump administration’s effect on the job market, consumer prices and the international economy writ large will resemble the last term or any other administration in recent history.
The major financial figures from Mr. Trump’s first term included Steven Mnuchin, the Goldman Sachs partner turned Treasury secretary, and Gary Cohn, also a former Goldman executive and, for a spell, Mr. Trump’s chief economic adviser. Mr. Trump’s nephew and personal counsel, Jared Kushner, the scion of a real estate fortune, also counted as a mainstream name.
Those three and others pushed Mr. Trump toward longtime Republican priorities like cutting corporate taxes, and tried to discourage nationalist economic impulses like tariffs. But the individuals around the president-elect this year are encouraging him to take a hard turn in a new direction, economically speaking.
There is Mr. Lutnick, the chief executive of Cantor Fitzgerald, a small player in the investment banking world, who heads Mr. Trump’s transition team. He’s a big proponent of tariffs on imports from China as a substitute for income tax.
“Don’t tax our people. Make money instead. Put tariffs on China and make $400 billion,” Mr. Lutnick said in a podcast interview late last month.
Mr. Trump did impose some tariffs, on steel and aluminum, among other materials when he was last president, but they were left in place by President Biden and were far less severe than the as-high-as-60-percent rates Mr. Trump is now talking up. Economists of both parties generally agree that tariffs like that could push prices of consumer goods higher and lead to cascading economic consequences as countries respond in kind.
In interviews this week, Wall Street advisers and investors mostly discounted the possibility that Mr. Trump would impose such severe tariffs. But they said if he did move forward, the tariffs would be disastrous for business and Wall Street.
“We think tariffs will have to wait,” until perhaps a year from now, analysts at Barclays wrote Wednesday.
Mr. Bessent, a former money manager for George Soros, has suggested there might be a way for Mr. Trump to undercut the chair of Federal Reserve, Jerome H. Powell, by naming someone else to the position well before Mr. Powell’s term expires. It’s something that new presidents don’t usually do because it would widely be seen as interfering in the central bank’s independence, and could unsettle financial markets.
Mr. Bessent also wants to slash government subsidies for industries like electric vehicles, as part of what he told Fox Business in September was a move to “re-privatize the U.S. economy.” He added, “We are not France.”
Neither Mr. Lutnick nor Mr. Bessent responded to requests for comment. Nor did Mr. Trump’s transition team.
The president-elect also enjoys public support from some high- profile financiers who served on an advisory panel during his first term, including the founder of the Blackstone Group, Stephen Schwarzman, who last week described Mr. Trump as likely to be more efficient and effective in a second term.
The Wall Streeter who is perhaps the most traditional Republican voice in the president-elect’s circle has been the billionaire John Paulson. In a recent interview, he talked up slashing regulation, taxes and government spending. Mr. Paulson, who gained fame in 2007 for betting against subprime housing before that industry collapsed, has more recently been a booster of gold investments because he sees the U.S. dollar in a long-term decline.
But on Wednesday, Mr. Paulson signaled through a spokesman that he would not take on a formal role in the new Trump administration. “He got involved in the campaign to help President Trump win and with that accomplished, he is stepping back,” the spokesman said.
As ever, there’s a hefty degree of uncertainty on specific future policy moves with the mercurial Mr. Trump. In his first term, he embraced colliding points of view and often changed his mind. There was notable turnover in his staff, too, meaning that his advisers are likely to change.
Yet in interviews overnight Tuesday and into Wednesday, even some in the financial world who opposed Mr. Trump’s run expressed optimism that his election would be positive for the economy and for business. Financial markets reflected that, in part, with U.S. stocks surging.
Investors and executives were in particular hopeful that the president-elect would push out government officials who have been tough on antitrust issues. The top of the list is Lina Khan, the chair of the Federal Trade Commission, who weighs in on mergers and acquisitions, the lifeblood of the Wall Street economy, and has sued to block multiple deals — taking a more aggressive stance than many of her predecessors.
Scott Barshay, partner at the corporate law firm Paul Weiss, said that the appointment of “more mainstream leaders” in antitrust would boost such transactions, which have been moribund in recent years.
One of Ms. Khan’s fiercest critics, Elon Musk, could be seen huddling with Mr. Trump at Mar-a-Lago on Tuesday night at a table lined with red roses. Many on Wall Street and especially in the tech world see Mr. Musk’s ascendance in the Trump world — the Tesla chief executive donated tens of millions to help the campaign — as a net positive.
“It’s going to be easier to get things done for entrepreneurs, founders and builders,” said Paul Hudson, founder of investment firm Glade Brook Capital Partners, who was also at Mar-a-Lago.
As ever in the rotating orbit around Mr. Trump since his arrival on the political scene a decade ago, former advisers can’t be counted out. Jay Clayton, the director of the Securities and Exchange Commission in Mr. Trump’s first term, has expressed interest in a comeback in what could be a Cabinet-level post.
And Mr. Cohn, the former Goldman executive who quit the White House in 2018 and was said to be upset by Mr. Trump’s sympathetic remarks toward white nationalist groups, has already begun liaising between chief executives and the president-elect, a person close to him said.
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