Which agencies will Trump eliminate?
I think USAID has a meaningful chance of being eliminated or functionally dismantled during Trump’s term, but the legal and institutional hurdles are substantial. My independent estimate is lower than a coin flip, yet notably above the market’s current 26% Yes price.
Analysis
USAID is one of the most plausible targets in a Trump administration because it sits at the intersection of foreign aid, bureaucracy, and ideological opposition to spending abroad. If the administration has a strong mandate and continues to pursue aggressive executive-branch reorganization, it could attempt to hollow out the agency through budget cuts, personnel reductions, and transfer of functions to the State Department, which would get the market closer to a practical elimination even if the formal legal status remains contested.
At the same time, fully eliminating USAID is not trivial. It has statutory roots, its programs are deeply embedded in broader U.S. foreign policy, and any attempt to abolish it outright would likely face congressional resistance, court challenges, and pushback from defense, diplomacy, and humanitarian interests that view aid as strategically useful. That makes the difference between “severely weakened” and “actually eliminated” a major gap, and prediction markets often overstate the odds of dramatic bureaucratic outcomes that are politically popular but procedurally hard.
Against the current market price, I think the Yes side is somewhat undervalued. A 26% price seems too low given how aligned this target is with Trump’s rhetoric and the possibility of an aggressive administrative effort to merge, defund, or neuter the agency. Still, I would not push the probability much above the high 30s because the legal durability of USAID and the need for congressional or judicial acquiescence make full elimination meaningfully harder than a normal executive-branch reshuffle.
Arguments
For
- Trump has repeatedly signaled hostility toward foreign aid and bureaucratic agencies, making USAID a natural target.
- With several years in the term, the administration has time to pursue reorganization, defunding, and personnel reductions that could culminate in elimination.
Against
- USAID is legally and politically more entrenched than a purely executive-created office, so outright abolition is difficult.
- Foreign policy, humanitarian, and congressional stakeholders may resist any move that goes beyond restructuring into a true elimination.
Key drivers
- Trump has strong ideological incentives to target foreign aid and agencies associated with it.
- The main obstacle is legal and institutional resistance, not lack of presidential intent.
Risk factors
- Congress or the courts could block a formal abolition even if the administration tries to gut the agency.
- The market may count a de facto merger or major downsizing as elimination, creating definition risk.
Scenarios
Best case
The administration successfully merges USAID into the State Department or strips it of independent functions so thoroughly that the market would likely count it as eliminated.
Most likely
USAID is heavily cut, reorganized, or partially absorbed, but the agency is not fully eliminated in a way that clearly satisfies the market resolution.
Worst case
USAID survives with its core structure intact after courts, Congress, or internal resistance prevent a formal abolition.
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