Following a red wave that swept much of the country, a second Donald Trump presidency will usher significant changes in the nation and Silicon Valley.
More than 28% of Santa Clara County voters this month cast a ballot for Trump — up from 25% in the presidential election in 2020 and 20% the New York billionaire won his first time on the presidential ticket in 2016.
Now, as he prepares to become the 47th president of the United States, Silicon Valley is bracing for shifts in the economy, tech and innovation policies, women’s reproductive rights, housing and more.
Economy
Inflation is expected to rise under Trump, multiple experts said.
Trump wants to implement tariffs of up to 20% on all goods, with increased tariffs of up to 100% on products coming from China. That means consumers’ wallets could take the hit. U.S. companies will raise costs because the threat of competition will diminish.
Some of Trump’s economic policy ideas include eliminating federal taxes on tips and Social Security payments in an effort to help low-income families, though it is unclear how he’ll fund those initiatives.
Tariffs could increase the cost of doing business in Silicon Valley, cause countries to retaliate and disrupt supply chains, Kenneth Schultz, a political science professor at Stanford University, said.
“In general, Silicon Valley companies have benefited from an open trading system,” Schultz told San José Spotlight. “If Trump carries out his promises, that system is at risk of fraying. There is also a chance that the business community and Congress will push back if he tries to impose broad-based tariffs.”
An analysis by the National Retail Federation predicts the cost of apparel could spike by 12% to 20%, under new tariffs.
“When costs go up like that, inflation goes up,” retired San Jose State political science professor Larry Gerston said. “Which is another addition to cost for the consumer through the interest the consumer pays on housing, automobiles, credit cards — almost everything.”
Tech and innovation
Some Silicon Valley corporations, however, stand to benefit from tariffs. During a speech at the Economic Club of New York, Trump pledged to reduce taxes on businesses down to 15%. In 2017, Trump slashed taxes on corporations from 35% to 21%, where it currently stands.
“I think the companies are hopeful that the tariffs will go up to protect the chip businesses and hardware that is produced in Silicon Valley and other places by companies owned here,” Gerston said.
Trump’s return to the White House could mean a deregulation of cryptocurrency and artificial intelligence, and a strengthening of antitrust laws, Joint Venture Silicon Valley CEO Russell Hancock said. During Trump’s first term, the U.S. Justice Department filed an antitrust lawsuit against Google accusing it of monopolizing the online search market.
“We’ll probably see AI unfold now without any particular controls,” Hancock told San José Spotlight. “People in Silicon Valley were clamoring for control, monitoring and regulation.”
Trump has appointed two tech leaders, billionaires Elon Musk and Vivek Ramaswamy, to head a Department of Government Efficiency. This advisory group will make recommendations for reducing government spending and regulations. Musk has said he wants to slash $2 trillion from the federal budget.
Trump pledged getting rid of President Joe Biden’s AI executive order that set standards for safety, security and protection of Americans’ privacy.
“Right now the international floor for AI regulation is being set,” Brittan Heller, an international law professor at Stanford University, told San José Spotlight. “By focusing on ‘government efficiency’ and other red herrings, the Trump administration will miss out on an opportunity to meaningfully represent America’s best interests, as the rest of the world is not disengaging.”
Ahmad Thomas, CEO of Silicon Valley Leadership Group, said California’s role in shaping the policies related to the innovation economy is more important than ever.
“Our work to advance responsible AI, catalyze investments in clean energy and frontier technologies, support innovative housing solutions and promote widespread economic growth and business dynamism remains central to our mission,” he said.
Women’s rights
Women’s reproductive rights were a cornerstone of the presidential race between Trump and Democratic nominee Kamala Harris. Trump has taken credit for overturning Roe v. Wade, the Supreme Court case that protected abortion rights federally. Eliminating federal abortions rights allowed states to enact their own state-level bans.
California law gives women the right to have an abortion before viability, the point in which a fetus can survive outside of the womb.
Trump has said he will not sign a federal abortion ban and said the issue should be left up to the states.
Dianna Zamora-Marroquin, spokesperson for Planned Parenthood Mar Monte in San Jose, still worries Trump’s second presidency poses more of a threat to women’s rights than his first.
“Since Roe v. Wade was overturned in 2022 — as a result of Trump’s appointment of three very conservative justices to the U.S. Supreme Court — nearly half the states in the country have virtually eliminated access to abortion,” Zamora-Marroquin told San José Spotlight. “But that is not enough for the extreme-conservative policymakers who drafted Project 2025, a proposed blueprint for the new Trump administration. Some have called for ending Medicaid reimbursement — ‘defunding’ — any health care organizations that provide abortion care.”
Immigration
The threat of mass deportations supported by Trump have stoked fear and unrest in Silicon Valley’s vast immigrant community. More than 40% of Santa Clara County’s population is made up of immigrants. Out of the 765,800 immigrants living in the county, 134,100 are undocumented. Trump has entertained declaring a national emergency and using military resources to deport people.
In 2021, immigrants in Santa Clara County paid more than $15 billion in federal taxes and nearly $7 billion in state and local taxes, according to the American Immigration Council.
San Jose Police Chief Paul Joseph reiterated his department will not “initiate any action to determine a person’s immigration status.” Santa Clara County is a sanctuary county, which means officials do not notify U.S. Immigration and Customs Enforcement agents when undocumented individuals are released from incarceration.
Immigrants in the DACA program, which protects them from deportation if they arrived as a child prior to 2007, are also in limbo. During Trump’s first term, he sought to eliminate the Obama-era policy. In an interview with the New York Times last year, he vowed to end the program if reelected.
Deporting undocumented immigrants in Silicon Valley could lead to an increase in labor costs, consumer prices and a loss of tax revenue for the region.
“Imagine the upheaval to the people that would be pulled out of their communities, out of their families, as well as the economic (upheaval),” retired San Jose State University professor Scott Myers-Lipton told San José Spotlight.
Trump may also decrease legal immigration for highly skilled workers who hold H1B visas, Shultz said.
“(They are) an important part of this region’s economy,” Schultz said. “It is possible that there will be a struggle between Trump’s Silicon Valley backers and his restrictionist advisors, like Stephen Miller, over this issue.”
Housing
Trump wants to lower mortgage rates and increase housing supply.
According to Freddie Mac, affordability continues to be an obstacle for potential home buyers with mortgage rates higher than they were pre-pandemic. Research from CBRE, a real-estate services company, found the average monthly mortgage payment exceeded rent by 38%, a trend that could continue for at least five years.
Academics worry deportations could increase housing construction costs and cause delays. Immigrants comprise 45% of the construction workforce in the county, and undocumented immigrants make up 13%. In California, there are 240,000 undocumented immigrants working in construction.
“What happens at the federal level is always important for the type of housing policy and the type of housing funding that we see here locally,” Regina Williams, CEO of nonprofit SV@Home, told San José Spotlight. The organization advocates for more affordable housing in Silicon Valley. “Over the past few decades, housing funding has dried up and been reduced, and the funding that comes from HUD is not the significant amount of funding that it once was.”
During Trump’s first presidency, he proposed cutting affordable housing programs and reducing the budget of the U.S. Department of Housing and Urban Development. Congress largely disregarded his proposals, even increasing the department’s budget to help low-income families. But that could change with Republicans having complete control of the House and Senate.
Foreign affairs
Trump wants to end the war in Ukraine, bring peace to the Middle East and put America first. Trump has signaled he wants the ongoing Israel-Hamas war to end and for Israel to destroy Hamas.
In his previous term, Trump offered broad support to Israeli Prime Minister Benjamin Netanyahu. He also was sympathetic to Russian President Vladimir Putin and called for NATO allies to step up their military spending. That may continue in his upcoming term, Shultz said.
“(Trump) will likely give Netanyahu even more of a free hand than Biden has to dictate terms in Gaza, the West Bank and Lebanon,” Schultz said.
Trump has chosen Florida Rep. Matt Waltz to be his national security advisor, former Rep. Tulsi Gabbard for director of national intelligence and Florida Sen. Marco Rubio as his secretary of state. In the past, Rubio has advocated for a more hawkish approach toward China and Cuba, but has recently aligned his stance more closely with Trump’s isolationist approach.
“This group of nominees indicates a strong future potential for instability in American governance,” Heller said. “Investors and foreign governments alike will react to this volatility, as factors like enforcement and composition of laws, continuation of foreign aid and alliances, and the aggressiveness of American interests will be unclear.”
Contact Joyce Chu at [email protected] or @joyce_speaks on X, formerly known as Twitter.
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