There are a lot of “what if’s” for Nevada following the election of Donald Trump.
Trump’s policy decisions on China, health care and infrastructure spending could have major consequences for Nevada, according to speakers Tuesday at the Las Vegas Metro Chamber of Commerce’s Preview Las Vegas networking and forecasting event at the Thomas &Mack Center.
Mike PeQueen told the crowd of about 1,900 business and community leaders that he believes it will be a good year ahead filled with “a lot of surprises because of the new presidential administration.”
As a city that is affected by foreign trade more than many other cities its size, Las Vegas could be in danger if trade tensions with China heat up, PeQueen said.
“Our gaming companies get a big percentage of their revenue from China itself, so we are a city that is very, very vulnerable sometimes to trade tensions,” he said.
Robert Lang, executive director of Brookings Mountain West at UNLV, said tension between the United States and China also could ultimately impact the local housing market.
If China has reason to no longer purchase U.S. Treasurys, that would ultimately lead to higher interest rates that could affect consumption of big-ticket items like housing and vehicles, Lang said.
“We are one of the most dependent regions on China for … foreign investments, and it’s also our principal area of external investment — we own large gaming enterprises in Macau, for example,” he said.
One of Trump’s first actions in office was to sign an executive order to “minimize the unwarranted economic and regulatory burdens of the [Affordable Care] Act.” As the Review-Journal previously reported, state lawmakers are in limbo trying to prepare the state’s budget.
“One of our drivers for economic growth and diversification has been building health care to the size that the region should have,” Lang said. “As we ramped that up, we were counting on the ACA being in place and sustaining that.”
Lang said Nevada would face serious trouble if it lost the stream of money the federal government was funneling to it from the health care law’s requirement that people buy into the system.
“If you lose that basic input in revenue stream, that’s the concern. That’s the number we can’t lose,” Lang said. “Whole towns are reliant on this now. Henderson has got a lot of its eggs in that basket now, hoping to be sort of a health care provider, not just for Henderson, but for the region. Downtown Las Vegas is considering that as one of the principal drivers for its diversification efforts.”
If Las Vegas wants to be a city with a strong health care sector, he added, “we better hope that the federal government resolves this” in a way that sustains the investment dollars for Nevada.
PeQueen said it would be a big boost for Nevada’s economy if Trump made good on his promise to push infrastructure spending through Congress.
Lang joked that he’d be willing to let Trump take credit for I-11 — a proposed interstate highway between Southern Nevada and southern Arizona — if that would help to get it funded faster.
PeQueen also said that infrastructure spending could get a boost from Trump’s stance on tax repatriation.
“There are currently $2.5 trillion in corporate assets of American companies held overseas. Those are likely to come back into America because Donald Trump and his administration are proposing a low tax to bring them back,” PeQueen said. “That tax would be about $250 billion, which could easily be steered to infrastructure projects.”
Contact Nicole Raz at firstname.lastname@example.org or 702-380-4512. Follow @JournalistNikki on Twitter