Which agencies will Trump eliminate?
I գնահատimate a moderate chance that USAID is eliminated or functionally dismantled during Trump’s term, but not a majority chance. The legal and congressional barriers are real, so my independent probability is 34%.
Analysis
USAID is a particularly plausible target in a Trump administration because it sits at the intersection of foreign aid skepticism, administrative centralization, and longstanding conservative criticism of the agency’s mission. If the White House is determined to shrink or absorb it, there are several paths that could amount to elimination in practice: severe budget cuts, transferring functions into the State Department, or simply hollowing out the agency until it no longer operates as an independent entity. That makes the Yes case meaningfully real, especially over a multi-year horizon with a cooperative Congress or a sustained executive push.
At the same time, full elimination is harder than rhetoric suggests. USAID was created by statute, its programs are deeply embedded in appropriations and foreign policy machinery, and outright abolition would likely require congressional action or a durable legal workaround that survives court review and changes in political control. Even a hostile administration may prefer to pressure, merge, or underfund it rather than complete a legally clean elimination. Historically, agencies this entrenched are easier to weaken than to erase, which caps the probability below a coin flip.
Relative to the current market price of 26% Yes, I think the market is somewhat underestimating the chance of a de facto or formal elimination. A 26% price implies the market sees this as a low-probability, mostly symbolic threat, but the combination of ideological hostility, executive power, and the long time window before 2029 gives the Yes side more room than that. I would still keep the probability well below 50% because Congress and the courts are serious obstacles, but the market appears a bit too conservative on how far a determined administration could go.
Arguments
For
- Arguments for Yes: USAID is a visible target for cuts, consolidation, or absorption into State, and those steps could satisfy many market definitions of elimination.
- Arguments for Yes: A determined administration with budget leverage and a sympathetic Congress could weaken the agency enough to make formal existence mostly nominal.
Against
- Arguments against Yes: Completely eliminating a federal agency usually requires legislative action, and that is a high bar even for a strong president.
- Arguments against Yes: Foreign policy needs, bipartisan aid coalitions, and legal challenges could preserve USAID in some operational form even under heavy pressure.
Key drivers
- Trump’s longstanding skepticism toward foreign aid and willingness to restructure agencies increases the odds of aggressive action against USAID.
- The long remaining time until 2029 gives the administration multiple budget cycles and legislative windows to pursue elimination or a functional merger.
Risk factors
- USAID’s statutory basis makes full abolition difficult without Congress or a legally durable reorganization.
- Congressional pushback, judicial intervention, or a future change in political control could stop or reverse dismantling efforts.
Scenarios
Best case
The administration successfully transfers most USAID functions into the State Department, slashes staffing and funding, and the market treats that as elimination before the term ends.
Most likely
USAID faces substantial cuts and restructuring attempts, but it survives in some form, making full elimination less likely than a partial hollowing-out.
Worst case
Congress and the courts block major changes, USAID remains intact as a distinct agency, and the elimination effort fails outright.
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