The Economics of Exclusion: Trumpism, Identity Politics, and the Future of Fiscal Policy

1. Introduction

In the U.S., fiscal policy debates have expanded to highlight identity politics where the markers of race, culture, and nationhood are becoming primary indicators of resource distribution and regulatory programs (Sandbu, 2025; Freebourn, 2023). This shift denotes a departure from the past in which fiscal conservatism was characterized by wide tax cuts and deficit reduction as key aspects to its principles, to a new framework of public policy, which utilizes identity markers to attract various groups and values the broader cultural tenets (Ramesh, 2024; Rubrick Biegon, & Hamdaoui, 2024). The implementation of “identity-driven fiscal policy” is exemplified by such steps as the 2017 Tax Cuts and Jobs Act, which provided higher tax benefits to suburban and predominantly white homeowners than to rural or minority homeowners (Sandbu, 2025; Geismer, 2024).

State-level initiatives have also connected social assistance and entitlements to immigration terms and cultural identity, depicting a general populist impulse in identifying fiscal entitlements with ideas of deservingness based on personal identity (Schneider, 2024; Alesina & Tabellini, 2024). The preference for “America First” spending made by President Trump was obvious and became clear in the communities that supported nativist as well as cultural nationalistic opinions. These strategies that alienate others are seen as ways that will exacerbate financial inequality based on identity, undermine the base of citizenship and common purpose, and destroy social solidarity (Akram & Hassan, 2023).

1.1. Problem Statement

Populist fiscal policies, such as Trump's “America First” agenda, increasingly reflect identity-based preferences in public spending, favouring majority communities while marginalising minorities. These practices risk deepening economic inequality, weakening social cohesion, and eroding the foundational principles of inclusive citizenship. Despite growing global evidence of such exclusionary fiscal strategies, there remains limited scholarly analysis of how they are framed, justified, and institutionalised through seemingly neutral economic measures.

1.2. Research Context

Opponents reveal that hidden economic indicators, such as the urban targeting of areas with considerable minority populations for decreased funding, work as potent symbolic gestures that sustain unequal social architecture in the name of objective fiscal action (Belongie, 2021). Liu, 2024). Foreign analysts observe such cases as Hungary, which encourages corporate tax breaks for majority-ethnic regions, and India, which spends more for Hindu-majority constituencies, showing how populist governments use fiscal measures to benefit core supporters rather than minorities (IMF, 2024; CEPR, 2024). This global trend signals the current necessity to examine how what is now seen as objective and uncontroversial fiscal policy has been made into a field of heated identity-based power struggles that unsettle liberal democratic values (Riaz & Rana, 2024). The mainstream discourse discusses such larger economic metrics as growth and holdover related to debt, while the new fiscal exclusion scholarship highlights how different fiscal privileges affect larger social and political circumstances (Ndlovu, 2024). Since fiscal policy has become one of the main outlets for identity-based conflict, an analysis of these engagements is critical in ensuring equity and social cohesion in the current divided environment (Varma, 2024).

Trumpism re-construes fiscal policy as a way to implement insider-outsider separations, using identity markers to allocate public resources and implement policy priorities (Sandrin, 2023). This change is reflected through the welfare that is based on citizenship and cultural proximity to the dominant population, which consequently disqualifies the non-white and native populations from becoming truly fiscal citizens (Pierce, 2024). For example, the rules of “public charge” are already being tightened to prohibit federal benefits to immigrants, and there is a strong tendency to divert funds to infrastructure in regions with a dominant cultural vote (Rampling 2025). This strategy exacerbates inequalities along the lines of race and class, and reduces the universal welfare system by using budgetary determination with exclusionary criteria (Alam & Tandur, 2024).

The cascade effect of this is the redefinition of citizenship by identity-led fiscal actions of Trumpism, which is based on financial moves, defeating the purposes of economic equality and communal solidarity, in favor of cultural messages (CEPR, 2019). Such a leaning towards exclusion jeopardizes the equity, social harmony, and democratic authority of the state by ignoring the need for equal treatment in public finance (Maguze, 2024). It is imperative to adopt a broad theoretical and empirical approach to explain the influence of identity politics on fiscal policymaking and provide a guide for inclusive economic governance.

1.3. Research Aim, Objectives and Questions

This research aims to examine how Trumpism shaped fiscal policy to promote identity-based exclusion, using insights from fiscal sociology, symbolic interactionism, and critical race theory. Moreover, the present study examines the effects Trumpism on fiscal policies, to promote identity using fiscal sociology, symbolic interactionism, and critical race theory (KRISTOFF, 2023; ALAM & TANDUR 2024: Alam & Tandur, 2024). The purpose of the study is to trace the origin of exclusionary budget practice, unveiling the semantics of “deservingness” in fiscal discourse, and empirically testing hypotheses related to identity-driven redistribution, budgetary redlining, and strategic application of fiscal arsenal. The study findings contribute to policy recommendations that seek to address some exclusion and promote equitable allocation of resources (Ramirez, 2024), through its analysis of identity–fiscal politics.

1.3.1. Research Objectives

• RO1: To trace the origins and evolution of exclusionary budgeting practices in the context of Trump-era fiscal policy.
• RO2: To analyse the rhetorical framing of “deservingness” in fiscal discourse as a mechanism for identity-based redistribution.
• RO3: To explore how fiscal tools such as tax reforms and budget allocations were strategically used to favour majority groups.
• RO4: To contribute to policy recommendations that promote equity in public resource allocation.

1.3.2. Research Questions

• RQ1: How did Trump-era fiscal policies reflect and reinforce identity-based exclusions?
• RQ2: In what ways was the concept of “deservingness” used to justify unequal fiscal decisions?
• RQ3: What evidence exists of budgetary redlining or selective redistribution targeting minority communities?
• RQ4: How can fiscal policy be restructured to promote more equitable and inclusive outcomes?

1.4. Research Contributions

By focusing on identity and fiscal domains, the research also contributes to continued discussions about economic justice and the effectiveness of democratic institutions while populism swells. The main purpose of the study is to merge theoretical expertise with policy impacts, promoting normative proposals on inclusive fiscal formations that reinforce social links and resist identity-exclusion. The results will be applicable to both researchers and legislators trying to eradicate idiosyncratic welfare benefits and promote the general and inclusive social security.

2. Literature Review

This literature review critically explores the theoretical and empirical terrain surrounding the intersection of fiscal policy and identity politics in the context of Trumpism. It begins by outlining the historical foundations of exclusionary fiscal practices, tracing how economic governance has long reflected underlying social hierarchies. It then turns to contemporary debates that assess the fiscal implications of populist and nationalist agendas. Following this, the review identifies critical gaps in existing scholarship, particularly the lack of conceptual clarity and empirical depth in understanding identity-driven redistribution. To address these gaps, the review is grounded in three interrelated theoretical frameworks: fiscal sociology, which positions the state as a producer of social stratification; symbolic interactionism, which explains how fiscal language construct’s identity; and critical race theory, which exposes how structural racism is embedded within fiscal institutions and outcomes.

2.1. Historical Foundations of Exclusionary Fiscal Policy

Social Security and the Fair Labor Standards Act in the United States were structured in such a way that they inadvertently left out agricultural and domestic workers, who were mostly black Americans (Perea, 2011) at the turn of the twentieth century. Legislators in the South carefully constructed occupational categories to sustain segregated, low-wage work arrangements through allegedly objective criteria that maintained racial stratification (George, 2023; Darity et al., 2023). Scholars argue that the intent behind these exclusions was not mainly efficiency in bureaucracies but rather controlling Black labor through fiscal policy decisions (Ray, Herd & Moynihan, 2023). During the 1990s, and in the debate over welfare reform, the distinction between “deserving” and “undeserving” poor became key, and this included racialized images as the “welfare queen” within legislation such as the 199 (Parker, 2021). Policymakers and the media promoted messages describing minority households as abusers of the welfare system and therefore called for more requirements and limits in order to cut benefits for Black and Hispanic people (Alphonso, 2021). Although racialization of deservingness veiled the neoliberals’ desire to decrease the welfare programs, it relied on cultural narratives to legitimize reductions (Barwick-Gross, 2025). In essence, the historical underpinnings establish a pattern that has persistently existed, shaping economic policies to promote inequalities, by law, and through a wave of public opinion, systematically excluding vulnerable groups (Narotzki & Shanan, 202) The knowledge of such origin goes a long way in enlightening one on the way issues of identity bear on contemporary fiscal policies.

2.2. Contemporary Debates

Recent academic discourse has concluded that neoliberalism is to blame for promoting market-oriented anxiety, with right-wing populism instead using state intervention selectively to favor cultural majorities (Yakir, 2024). In the context of fiscal policy, neoliberalism promotes balanced budgets and deregulation, whereas populist governments in the US, as well as Hungary and India, utilize identity politics to justify the redistribution of proceeds to the preferred groups and blame outsiders (Stephenson & Kirakosyan, 2023). From a Critical Race Theory (CRT) lens, these fiscal policies appear biased. Studies indicate that it is a system by which structural racism is transmitted through taxation, spending, and gate decisions (Rychkov, 2022; Carney, 2021). A case of undocumented workers’ exclusion from receiving COVID-19 relief funds, even when they have been contributing taxes, demonstrates how legal status and race uniquely determine inclusion within fiscal programs (Disney et al., 20). CRT scholars demonstrate that budgetary policies in many ways maintain racial capitalism through offering tax relief to and subsidies predominantly for white property owners (Rychkov, 2022; Robinson, 2021). Additional research into symbolic fiscal practices indicates that such terms as “tax relief” or " tax cuts " are symbolic signals that affect what people think about some policies that enable exclusion despite the absence of specific legal limitations; therefore, disclosing that fiscal policy-making is more narrative than it is numbers (Labarca, 2025).

2.3. Critical Gaps in Existing Scholarship

Despite extensive investigations having been carried out, most findings fail to discuss how race, citizenship status, and class collectively exclude from the fiscal system through an intersectional approach. The IBPA analytical framework is aimed at examining the ways in which different identity dimensions overlap in policymaking, while it is hardly ever utilized in the field of fiscal sociology (Sumaru, 2022; Tedds, 2023). The investigations conducted by the OECD regarding gender budgeting reveal the prospects of an intersectional analysis approaching gender, socioeconomic status, and race (these three are interrelated), yet such a perspective is largely absent in conventional fiscal policy studies (OECD, 2023). In addition, the symbolic aspects of fiscal policy call for more academic attention. Although the political science field has witnessed a surge in symbolic policy theories, their application in budget parlors is not yet mature (Labarca, 2025). Emphasizing the role of narrative within governance at the same time, symbolic policy has yet to be fully integrated into the study of fiscal issues (Blanton et al., 2021). Examining symbolic language’s function in the creation of notions about fiscal citizenship offers important information on hidden exclusionary structures (Schwiertz, 2024). Addressing these gaps requires combining intersectional perspectives with analysis of symbolic practice in order to best understand the complexities of identity-based fiscal exclusion. Such an approach would reveal what part multiple identities play in allocating resources and shaping exclusionary narratives.

2.4. Fiscal Sociology: The State as a Maker of Social Hierarchies

Taxation and public spending processes, according to fiscal sociology, help shape social structures and determine who a citizen is. The tax system is the crucial tool for separating societal ‘insiders’ from ‘outsiders. States inadvertently target and widen socio-economic divides by implementing tax systems that provide income. For instance, progressive taxes can encourage an attitude of citizenship in poorer earners while regressive taxes may entrench these groups, establishing concepts of economic exclusion (Raza et al., 2024). The welfare system is a key component of this framework and is commonly applied for social control rather than protection. Governments can utilize their control of welfare benefits to strengthen the line between recipients who will get support and recipients who won’t, furthering already established social gaps. This accrues evidence that welfare policies are likely to have a great influence on economic destinations for deprived groups, sustaining or enlarging an array of poverty and exclusion (Udoudom et al., 2024). These processes reveal how fiscal policy merges with social stratification dynamics that become especially pronounced by the fiscal policies of the Trump administration, which clearly benefited some communities at the expense of other communities.

2.5. Symbolic Interactionism: Language, Policy, and Identity Construction

From the symbolic interactionism perspective, the role of language and symbols in constructing the identities, both personal and collective, of a society in the discussions on fiscal policies is examined. The public use of terms such as “civic responsibility” and “job creators” is one of the factors that influence the way society perceives economic engagement and fair merit (Mendes et al., 2022). The selected vocabulary in debates over fiscal issues contributes to the preservation of the existing balance of forces, forming public identity concepts associated with economic obedience and affluence. Moreover, budget allocation patterns tend to reflect enduring cultural perceptions, resulting in ‘budgetary redlining’ – a state in which it is apparent which communities the society favors and which are disliked through funding decisions. Scholars have demonstrated that where public funds often go to well-off areas reveals ongoing systemic inequalities resulting from deliberate policies based on societal prejudices (Mulyadi et al., 2023). The intricate interplay of language, identity, and public finance in fiscal policymaking contributes to the understanding of how economic marginality takes place in identity-based political arrangements.

2.6. Critical Race Theory: Structural Racism in Fiscal Systems

Critical Race Theory (CRT) provides a platform to study the fundamental structural racism that pervades fiscal systems. It explains how racial capitalism works in the context of the fiscal policy that has marginalized the non-white population for so long. Such systemic discrimination is reflected in a skewed tax system, unfair welfare provisions, and an uneven impact of austerity policies on the minoritized individuals (Derhun et al., 2022). Economic policies of the Jim Crow period provide a historical precedent where institutionalized racism hindered black communities from using economic resources and opportunities. These policies, which were not a reaction to sociopolitical climate but rather the product of intent, were designed to uphold the racialized economic subordination (Vaishali & Dar, 2024). Current fiscal policies continue to sustain imbalances in income levels among various racial groups, akin to having the effects of historical discrimination that remains a top propellant for reconsidering the impacts of financial structures in a society that is racially divided.

3. Method and Procedures

This study evaluates the impact of Trump-era fiscal policies on identity-based exclusion, using a constructivist-interpretivist-critical framework. Employing a qualitative case-study approach in which we perform discourse analysis of legislative sources, public speeches, and available literature to support our claims of research. The constructivist lens adopted by the study implies the development of concepts of economic institutions and fiscal citizenship from the social narratives about identity. The study examined two important case studies: the recent legislative efforts to tie entitlement eligibility to race or origin, while the second case is on how the amendments to the tax code reinforce the idea of the “social construction of illegality”. It is demonstrated through such incidents how perceptions of “whiteness” and citizenship define the hidden structures of policy-making. From an interpretivist perspective, recent texts were analyzed as narrative artifacts where the cultural meaning is greatly influenced by mythmaking elements. Lastly, the critical-axiological paradigm is used to inform the analysis of exclusionary policies and propose reparative justice as a framework for alternative policy interventions.

3.1. Data Collection

Data collection involved three categories of secondary resources, initiated from the analysis of Legislative and Regulatory texts, e.g., amendments to the 2025 Tax Cuts and Jobs Act, or policies to the sanctuary jurisdictions, to understand how the identity factors shape eligibility constructs. Second, transcripts of Trump’s proposals on the budget and congressional debates are “narrative performances” illustrating the cultural conditions where they were made. The study draws from findings in peer-reviewed journals and policy centers with a reputation for authority to offer fact-based background information.

3.2. Data Analysis

This inquiry relies on a discursive, multi-faceted approach to analysis. Using propositional testing, the analysis discovers that legislative materials maintain links between welfare benefits and identity markers such as citizenship, race, and origin, corroborating the identity trend in welfare access (P1). Second, an in-depth assessment of the 2025 tax measures and sanctuary city legislation reveals the use of “deserving insider” language and the development of discriminative budgetary practices (P2). Additionally, predictive discourse analysis examines Trump’s budget speeches for mythic symbols and moral justifications, which reflect a change from the fiscal state’s role from distributive equity to a source of cultural expression (P3). Through text, speech, and secondary material, the validity of these overlapping dynamics is endorsed.

4. Evaluation of Propositions

This study advances three propositions to explore how fiscal policy under Trumpism served identity-based and symbolic functions. Proposition 1 addresses identity-based redistribution, where benefits favour dominant groups. Proposition 2 examines coded language and budgetary redlining as tools of concealed exclusion. Proposition 3 frames the fiscal state as a cultural weapon, reinforcing nationalist and exclusionary narratives.

4.1. Proposition 1: Identity-Based Redistribution

Based on identity-based redistribution, welfare policies are highly associated with social identities and thus have an impact on citizens' access to necessary economic resources. There has been increasing focus on the ways that citizenship requirements for welfare programs, including Medicaid and SNAP, could widen racial differences. For example, the work of Barford et al. (2025) notes that the pervasive bias that is based on ethnicity and gender continues to dictate eligibility to welfare programs, making the problem of the vulnerable groups relying on such programs for sustenance worse (Barford et al., 2025). Also, the COVID-19 pandemic has widened preexisting gaps, which disproportionately affect racial minorities who often have a more difficult time applying for relief funds. According to Findor et al. (2022), the “deservingness” narrative is unfavorable to Black individuals. The application of Critical Race Theory (CRT) provides an understanding of how policymakers construct narratives of deservingness, privileging some identities while marginalizing others.

Further, in welfare debates, the concept of “welfare dependency” is unnecessarily associated with racial and ethnic biases (Borwein, 2024). Therefore, listening to the way distributional decisions are influenced by identity bears testament to the urgent need to formulate policies that help bridge these gaps. García-Sánchez et al. (2022) promote the use of holistic exercises that respond to the complex welfare views influenced by identity to guide the policies on equitable redistribution (García-Sánchez et al., 2022). The intersecting forces of citizenship parameters and racial disparities in welfare systems lead to profound social, financial, and political inequities that subsequently raise questions about how membership and belonging are determined within society.

4.2. Proposition 2: Coded Language and Budgetary Redlining

It is important to comprehend the effects of budgetary decisions on the socio-economic settings when a coded language is interpreted in policy considerations. For example, the “America First” infrastructure programs have depicted a wide allocation gap between the rural and urban areas. Zollinger's (2022) research shows that even though most of the rural areas have been facing the problem of economic decline, these areas are preferred under the guise of the national interest, leaving urban communities deprived of funding for a long time. These allocations contradict correct levels of equity and make one question the hidden messages contained in these budgetary commitments. The language used to refer to tax relief and corporate subsidies again speaks to this problem. Green and Humphrey (2022) note that “tax relief” is regularly utilized as an excuse for considerable corporate fiscal windfall, even though the marginalization of people with essential needs exists. This demonstrates the semiotics in budgetary discourse, showing how spoken words form a medium between ideological spending considerations and social understanding.

Additionally, symbolic interactionism assists in assessing how specific wording given in policy discourse affects public acceptance and understanding and perpetuates or transforms ideas of inclusion and exclusion (Dahlke & Hunter, 20). Also, while the effects of such terminological choices echo through affected communities, their resource acquisition and social advancement prospects are being defined further. Vital research, such as that by Sandelind and Hjerm (2021), demonstrates how public understanding of the policy language can alleviate or aggravate the already-present social inequality (Sandelind & Hjerm, 2021). Understanding these dynamics is critical, as policy-makers can base communication techniques to enable a more just fiscal conversation, with the intent of balancing instead of rationalizing imbalances.

4.3. Proposition 3: The Fiscal State as a Cultural Weapon

Analyzing the fiscal state historically and sociologically exposes its cultural manipulation to maintain systemic inequalities dressed up as identity politics. The imposition of tax cuts through theatrical gestures to gain the White middle-class votes epitomizes this arrangement clearly. Legislation that is advertised as “populist” often benefits richer portions of the population by weakening universal welfare programs (Bearce & Connell, 2021; Darwis & Sasterio, 2021). The change from universal welfare to targeted benefits by means of identity strengthens the transformation from an inclusive approach to selective schemes that will benefit certain groups based on racial and economic background (Benítez & Vellutini, 2021). Bearce & Connell (2021) report on attitudes toward immigration. Such evidence is important because it reveals moral burdens behind exclusion, as it demonstrates how concerns about identity determine perceptions of other people’s rights to welfare and access to finances.

Further, persistent research in fiscal sociology draws attention to the necessity of recognizing and reconsidering the role of governments in sustaining social inequalities. The discussion around fiscal policy often caused particular communities to embrace exclusionary national identities, as White communities could resist welfare programs that helped fewer worthy people (Pedulla & Donnelly, 2020). This procedure breeds oversized ethical dilemmas that pertain to the allocation of state resources and the ethical consequences of applying identity politics in ascertaining the economic insufficiency.

5. Case Studies and Predictive Analysis

To ground the theoretical propositions in concrete policy outcomes, this section presents three focused case studies that illustrate the exclusionary dimensions of Trump-era fiscal governance. Section 5.1 explores how tax policy reinforced the myth of the “productive citizen”, privileging certain identities through fiscal incentives. Section 5.2 examines federal aid conditionality, revealing how ideological alignment shaped funding decisions at the expense of equity. Section 5.3 addresses the fiscal marginalization of refugees and asylum seekers, highlighting how fiscal tools were used to signal exclusion and redefine the boundaries of deservingness. These cases also inform predictive insights on how similar logic may influence future fiscal policymaking under populist regimes.

5.1. Tax Policy and the Myth of the “Productive Citizen”

This subsection explores how tax policy under Trumpism reinforced the cultural ideal of the “productive citizen,” often coded as the white, dual-income, nuclear family. Section 5.1.1 examines how the Trump-era tax cuts disproportionately benefited high-income white families, exacerbating racial and class disparities. Section 5.1.2 offers a predictive analysis, showing a likely drift toward tax credits favouring married, high-earning families—using coded appeals to “family values” that align with dominant cultural norms. These trends suggest that tax policy not only redistributes wealth but also affirms and privileges a specific socio-racial identity.

5.1.1. Trump-Era Tax Cuts: High-Income White Families' Tax Relief Disparity

The Center on Budget and Policy Priorities reveals that the top 1 percent will benefit by receiving an average of $60,000 in tax cuts through the 2017 Tax Cuts and Jobs Act, while the middle- and lower-income (CBPP, 2024). The analysis published by the Institute on Taxation and Economic Policy (ITEP) bolsters the argument that Trump’s 2024 proposals would shift more of the benefits to the top 5% wealthiest households, while all other income groups would face higher overall tax burdens (ITEP 2024). This correlation is brought out by demographic statistics: The wealthiest quintile consists mainly of white suburbanites, a racialization of privilege (Tax Policy Center 2023).

5.1.2. Predictive Trend: Policy Drift toward Child and Marriage Tax Credits Favoring White Families

Following the tax cut trends, more tax relief in connection with children and marriage is expected, and it will only be for married dual-income couples using a coded appeal to "family values" that would resonate with most of the white USA population. Think tanks to the right suggest proposals to increase the child tax credit for families earning more than $200,000 (CBPP 2024). This is consistent with a more general cultural messaging approach: Tax reforms reflect and validate the conventional attitude of the society toward the ideal norm of the white, “productive” nuclear family.

5.2. Federal Aid Conditionality: Ideology Over Equity

This section investigates how federal funding was increasingly tied to ideological compliance rather than equitable need during the Trump administration. Section 5.2.1 explores state-level examples, where funding was conditioned on the rejection of critical race theory and other progressive frameworks. Section 5.2.2 presents a predictive analysis, warning of a continued trend in which federal aid—particularly in policing and public safety—may prioritise “law and order” initiatives in Republican-led states. These cases illustrate how fiscal conditionality can serve as a political tool to reward ideological alignment while reinforcing exclusionary governance.

5.2.1. State-Level Examples: Dependent Funding on Rejection of Critical Race Theory

The U.S. Department of Education promulgated a mandate in January 2025 requiring all the K–12 districts to attest to their compliance with Title VI and federal antidiscrimination law at the risk of failing to receive ESSER and title-I funds—explicitly citing “divisive concepts” labeling DEI and CRT initiatives as prohibited (US Dept of Ed 2025). Legal analysis highlights how this certification embeds a conservative cultural agenda in the curricula (Lathrop GPM, 2025). Consequently, more than a dozen states have adopted “anti-CRT” legislation, whereby federal money is dependent on being against critical-race theory, placing a patchwork of political criteria into public school curricula (Hanover Research, 2024).

5.2.2. Future Risk: Federal Support for “Law and Order”-Policing in States Controlled by the GOP

The Department of Justice has rebranded Edward Byrne JAG and COPS grants as “law-and-order” funds, establishing new requirements rewarding jurisdictions for meeting unspecified crime-control norms and cooperating in immigration enforcement (Council on Criminal Justice 2024). In early 2025, hundreds of non-violent crime grants were canceled (Reuters, 2025), but budget proposals show that there has been a move towards strengthening state police in GOP-controlled states, leaving a message of rigorous enforcement as social programs experience reduced resources (Bureau of Justice Assistance, 2024). This shift in perspectives could perpetuate interconnected systemic inequities by formalizing a practice known as redlining in funding decisions for public safety.

5.3. Fiscal Marginalization of Refugees and Asylum Seekers

This section examines how fiscal policy was used to marginalise refugees and asylum seekers by restricting access to essential public services. Section 5.3.1 details the reduction in healthcare and housing support, signalling a broader retreat from humanitarian obligations. Section 5.3.2 provides a predictive analysis, suggesting that expansions of the “public charge” rule may further restrict non-citizen access to social benefits. Together, these trends reflect a fiscal strategy that frames migrants as economic burdens, reinforcing exclusion through bureaucratic and budgetary means.

5.3.1. Decreasing Opportunities for Healthcare and Housing for Asylum Seekers.

The Congressional Research Service’s November 2024 results make public new Medicaid/CHIP eligibility standards that leave most non-citizens, including asylum seekers, out of the fold for five years or even longer, drastically reducing access to primary care among the most recent migrants (Heisler & Kolker, 2024). Kaiser Family Foundation surveys report that in 2023, 45% of immigrant adults were uninsured, and that this percentage is likely to increase if “public-charge” restrictions get more severe (KFF 2025). NYC asylum seekers frequently end up in overcrowded shelters because they are required to wait 180 days for work permits, and a recent policy restricts this to 30 days, exacerbating the lack of units (AP, 2023; Time, 2023).

5.3.2. Predictive Analysis: Expanding “Public Charge” Rules to Limit Non-Citizen Benefits

Based on the above considerations, a Trump administration-style expansion of the “public charge” doctrine is expected, excluding asylum seekers and refugees from non-cash benefits such as SNAP, housing vouchers, and relief grants from federal support. (AILA, 2023; NILC, 2024). Preluding early 2025, leaked policy memoranda hint at wealth-and-work requirements for benefit eligibility that will fraction welfare between citizenship-haves and demonstrated “self-sufficiency”. These actions would legislate financial marginalization, informing future immigrants that the act of seeking government support makes them an “undeserving outsider”.

6. Discussion, Implications, and Future Trajectories

The present study reveals worrying trends of a purposeful divide being made between the perceived “deserving” insiders and “undeserving” outsiders, most readily apparent in discussions about tax reforms and educational spending. The middle-class tax cut claims by the Trump administration did not at all represent middle-class people but rather benefited high-income families, largely white, which further widened racial and economic gaps. Evidence garnered from economic research shows how these policies perpetuate inequality rather than resolving it, exhibiting their mostly regressive effects (Ouraga, 2021; Limo This use of fiscal policy may infuse meritocratic ideals, by default, favorably locating high-income communities and weakening support for those affected by inequality (Evgenidis & Fasianos, 2020).

Also, the lodgment of ideological criteria, especially those opposed to Critical Race Theory, for federal K-12 funding defines how ideology can undermine fair education provision. The practice is commonly known as “budgetary redlining” and involves the apportionment of federal dollars based upon defined ideological criteria. This strategy is likely to exacerbate rifts within heterogeneous populations and impinge on academic freedom, at complete variance with the initial intention of educational funding to balance resource imbalances (Miyashita, 2023). The impacts are severe, as the data indicate that the restriction of intellectual exploration funding swells regional gaps and questions democratic values (Terblanche et al., 2024).

Further, the continued ill-treatment of asylum seekers and refugees highlights yet another aspect of exclusionary governance, but also there appears to be the threat of polarization of communities. When healthcare and housing services become progressively hard to reach, policymakers create a financial environment where only those who are considered ‘productive citizens’ benefit. The discriminatory nature of such policies violates universal human rights principles, as scientific research shows the adverse effects on at-risk populations (Bullard, 2022). Such practices can breed the formation of a long-term disadvantaged class within the socio-economically stratified population (Bintabara, 2021). This practice strengthens a system where the provision of money depends on social reception, thus widening the existing fiscal differences (Ruankham & Pongpruttikul, 2023).

The common complaint would be that such policies are designed to stimulate work and create a monetary umbrella for the taxpayers (Alves & Coelho, 2024). The visible fiscal prudence of such measures may conceal the future societal costs, such as healthcare inequities and the lack of education that all undermine social cohesion (Sarwar et al., 2023; Ascari et al., 2020). Dismantling stratified systems ingrained in current fiscal policies can be achieved in part by instituting reparative justice, universal and race-free economic transfers, such as unconditional child allowances. Adoption of inclusive transfers promotes a redistribution of resources that respects every citizen’s value, with a view to breaking through the repeated patterns of exclusion (Mustapha et al., 2024). The study emphasized that without these major shifts, it is a risk that the U.S. could succeed in mending divisions within its fiscal fabric, thereby threatening both economic security and social cohesion (Clifton et al., 2020).

7. Conclusion

The study highlighted how Trumpism converts a fiscal process into cultural exclusion, whereby the wealthy white group’s interests are catered for through tax cuts and welfare cuts while relegating the needs of the colored and immigrant groups. Such policies intensify income distribution gaps and question the basic responsibility for equitable welfare. The study emphasized that policymakers should quickly address fiscal governance to promote economic justice by eliminating discriminatory selection criteria and, instead, working on equitable, race-neutral funding. Similarly, scholars need to refuse to think in terms of “deservingness” and to adopt intersectional approaches to address the multiple expressions of inequality based on race, class, and citizenship. Immediate qualitative observations reveal the detrimental implications of such policies, but longitudinal work is needed to trace the subsequent impacts on the socioeconomic formations. The study calls for further research utilizing intersectional approaches to inform us on how different identities overlap and how they lead to exclusion; how to build equitable fiscal systems that promote social cohesion.