MARKET reaction to Donald Trump’s win has been something between sanguine and elated. But if you set out to design policies to do long-term harm to the economy, you might end up with something resembling Mr Trump’s agenda. The next president threatens to erect trade barriers, which would disrupt supply chains and dampen productivity growth. He wants to deport many of America’s 11m illegal immigrants, which could reduce the size of the labour force by up to 5%. And his tax plan is ruinously expensive, costing almost $7trn over a decade, or around half of America’s outstanding national debt.

How much damage is President Trump actually likely to do? That depends first on how much of his policy he can get enacted. Until recently, his tax cuts would have been vulnerable to a Democratic filibuster in the Senate. But thanks to a rule change in the latest budget deal, the Republicans can now pass even unfunded tax cuts with only a simple majority, explains Richard Kogan of the Centre on Budget and Policy Priorities, a think-tank. (To do so, they must include sunset clauses, as George W. Bush did when he cut taxes in 2001.)

Congressional Republicans might moderate Mr Trump’s plan. The tax cuts Paul Ryan, Speaker of the House of Representatives, wants are expensive, but much less so than Mr Trump’s (see chart). The corporate tax may end up at Mr Ryan’s proposed 20% rather than Mr Trump’s desired 15%. Mr Trump’s costly promise to offer the same rate to sole traders may not survive. Both men agree that there should be three tax rates for individuals (12%, 25% and 33%), but there will be debate over the generosity of deductions.

Debt would rise significantly even under Mr Ryan’s plan. More borrowing will give the economy a boost in the short term. Mr Ryan’s tax cuts would be much bigger than Barack Obama’s fiscal stimulus in 2009. Add in the infrastructure spending Mr Trump also wants, and the economy could get much hotter, which helps to explain the rally in financial markets on November 9th. The question is to what extent this will jeopardise America’s long-term fiscal health. While Congress might rewrite the Trump tax plan, it has much less power to restrain Mr Trump’s protectionism. Existing laws allow the president to impose tariffs in very broadly defined circumstances, as Mr Trump gleefully noted during the campaign. He could use the president’s prerogative over foreign affairs to withdraw from the North American Free Trade Agreement with just six months’ notice, according to the Peterson Institute, a think-tank. Mr Trump has said that he is merely threatening to tear up trade agreements and impose tariffs, in order to achieve better trade deals. The goal of such new deals, according to his advisers, will be to eliminate the trade deficit. That is all but unachievable. The trade deficit is the result of low national saving, which will fall still further if the government borrows more. And no one knows how other countries will react to Mr Trump’s threats. Monetary policy is another cause for worry. Mr Trump has railed against low interest rates, saying they had stoked an economic bubble (a sentiment repeated by one of his advisers, to the Financial Times on November 9th). He also claimed that Janet Yellen, chairman of the Federal Reserve, was acting in an “obviously political” manner and “should be ashamed of herself”. This caused speculation that Ms Yellen might resign after a Trump victory. That seems unlikely; Fed chairmen have withstood presidential criticism before. But Ms Yellen will surely depart when her term expires in February 2018.

Who might Mr Trump nominate to replace her? In an interview before the election Stephen Moore, an economic adviser to Mr Trump, floated several names, including Larry Kudlow, a television pundit, Art Laffer, a private-sector economist, and Martin Feldstein, an academic, all of whom served in the Reagan administration. Most conservative economists like Mr Feldstein have been calling for tighter monetary policy for years; Mr Kudlow is an exception. If Mr Trump’s nominee is to reflect Republicans’ hawkishness, the expectation of higher interest rates will hang over the economy, though that may have bigger implications for economies outside America (see article).

With a big fiscal stimulus, though, higher rates might be needed to keep inflation down. That would send the dollar higher, hurting American manufacturers and increasing the lure of protectionism. That is where the biggest threat to growth lies.