Prediction Markets for Understanding Trump Regime Outcomes

A Path to Mental Balance for Those Freaked Out by Trump

Relative to most people I know, I manage to remain fairly serene despite the tremendous pressures to freak out about politics and current events. Right now many of my Democratic friends, as well as some of my libertarian and conservative friends, are freaked out by potential outcomes associated with the Trump regime.

Just to cut to the chase, before becoming more big picture and philosophical again, the single claim that Trump has made that has freaked me out the most because it seemed most plausible, are mass deportations. Since his election, I’ve repeated checked Metaculus, a leading prediction market, to see how likely it is that he might deport millions of people. He claimed in a Time Magazine interview he would deport 15-20 million people, which is an unimaginable scale that does horrify me. Yet at Metaculus, as of Feb. 2, 2025, the probability is 46% that FY 2025 will see twice as many deportations in as in FY 2024. In FY 2024 there were 271,484 illegal immigrants deported. Thus the prediction markets doubt that he’ll even get to 500K deportations. While one can be freaked out about that, it is not remotely the same as 15-20 million (all data from the Metaculus backgrounder at the link above).

My default expection is that almost everything said by almost every politician is largely false. I have the same expectation for almost all media insofar as their revenue model depends mostly on partisan outrage these days. They make money by submitting us to outrage porn all the time.

Last year I led a Socratic discussion with our 8-10 year olds at The Socratic Experience. I asked them, “How do they know when they are being manipulated?” The most sophisticated among them replied, “All the time.” They even recognized that advertisements on YouTube videos encouraging them to donate money to save the wildlife were deliberately manipulative. They might be manipulative for a good cause, but even at ages 8-10 they realized that the visual and emotional rhetoric, down to the background music, was designed to tug at our hearstrings. We may or may not choose to support a particular cause, but if 8 year olds are aware that they are being manipulated all the time on the internet, grown ups should be able to understand this as well.

Yet few people seem to be able to internalize this sufficiently to ignore the incessent manipulation. For this reason I encourage everyone to check prediction markets whenever they are freaked out by a claim to see what the current odds are.

To take a different example, Metaculus bettors recently upped the odds of a national ban on abortion before 2030 from 5% on Jan. 25, 2025, to 25% on Feb. 2, 2025. Personally, I suspect that probability is too high, a temporary bump that amounts to overreacting to the recent transition to Republican control of government. But given that 7 out of 10 states in which abortion was on the ballot in November 2024 expanded abortion rights, along with the fact that 70% of residents in blue states and 57% of residents in red states believe that abortion should be legal in most or all cases, an outright national ban is unlikely. When one adds to that a rapid decline in religiousity among the young, especially young women, then it seems extremely unlikely that a national abortion ban is going to take place regardless of what pro-life politicians promise their supporters.

Again, if one chooses to be alarmed at the prospect of a national ban on abortion, feel free to do so. But one should look at prediction markets and empirical data to determine whether or not alarmist headlines from partisans and activitists are likely to represent future realities.

The U.S. domestic issue that I’m most concerned about is of a coming fiscal collapse in the coming decade or so (see here for a brief overview of our debt situation). Elon Musk has been claiming that through DOGE he will be able to get us on track for a more fiscally viable sustainable future. But the market on Metaculus hasn’t budged since Trump was elected on the question of when we’ll get to a nominal debt of $50 trillion dollars (the closest question I could find). While it is likely that this is just not an active market, I would also expect that most observers are skeptical that Musk will be able to make a significant reduction in our annual deficit and thereby reduce the national debt. If he can prevent fiscal collapse, which would truly be brutal for the bottom half of Americans, that would be amazing (see the Urban Institute’s concerns regarding a fiscal collapse here).

Prediction markets are not perfect. We need larger, higher stakes, and more liquid markets. And they’ll still be imperfect and prone to bubbles, manipulation, and inadequate information. That said, I see reason to believe, following economist Robin Hanson, that they are far more likely to be accurate than is academia (if nothing else, because they can incorporate the best academic forecasts into their predictions). Anyone who doubts the prediction on a market can bet their beliefs. In a world with billions of actors, as we develop larger, higher stakes, and more liquid markets in predictions we’ll incentivize more accurate forecasting than we have today.

I’m actually fundraising for a market on climate change and African prosperity for my wife, African prosperity activist Magatte Wade. Right now there are some who claim that if we don’t reach net zero carbon emisssions soon, tens or hundreds of millions of people will die, disproportionately in the global South. They are using this justification in an attempt to stop fossil fuel development in Africa, on the grounds that the additional carbon emissions from African fossil fuels will lead to these high death counts in Africa. At the same time, there is a tremendous amount of evidence that affordable, reliable, and abundant energy is essential to create and sustain prosperity - and until we have widespread nuclear energy, in many circumstances fossil fuels will remain a necessary component of access to affordable, reliable, and abundant energy (read here for background on this issue).

But rather than debate such issues, I want to incentize prediction markets to settle such questions. How, exactly, to do so will require significant work - thus the first use of funds for such fundraising will be to identify relevant metrics and settlement criteria to resolve such disputes so as to optimize information gathering.

But I’ve already left the entire political circus of the Trump election behind. This is because I’ve long been focused on much bigger issues that American electoral politics. This might seem odd to those who live and breathe politics, but I really don’t see American national politics as the only moral concern. Trump is a highly unpredictable outlier, to be sure. If his regime can get the U.S. on a track of fiscal responsibility, that will be an immense positive achievement. But I’m not betting on it.

Maybe he’ll be able to achieve other positive things. Maybe his rule will result in immense negative outcomes. I don’t know. But to take one frequently alleged negative outcome, Metaculus markets are saying that there is a 1.7% chance that he’ll retain executive power past 2028. The notion that he will become a dictator has always struck me as far fetched, despite the fact that he has no respect for American norms of democracy.

The single biggest moral cause in my view is ensuring that the global poor achieve prosperity as fast as possible. One of my frustrations with the endless frothing about at the mouth over US politics is that few are focused on the global poor today. My wife is livid at the hypocrisy of those who claim that “Black Lives Matter” yet who have no interest at all in African prosperity, where 90% of black people live. She and I are working very directly on this problem through Prospera Africa. Because she is in contact daily with ordinary people in Senegal through the school and factory we have there, we hear about the routine illness, suffering, and death of real poverty on a daily basis. I just don’t have the intellectual or emotional bandwidth to worry much about American political drama given the real life and death issues that are part of our daily reality.

With respect to the U.S., creating and promoting better alternatives to replace conventional schooling is my primary focus. I see compulsory schooling, especially secondary schooling, as the root cause of most adolescent dysfunction and mental illness. Since the 1950s, teen suicide is up about 300%, teen suicides increase 30% every school year while classes are in session. The social media phenomena highlighted by Jonathan Haidt is simply a matter of exacerbating a much deeper, longer term human tragedy. Because much of my Substack documents this tragedy, as well as the solutions I propose, I won’t go into it more here. Suffice it to say that my primary policy issue is legalizing markets in happiness and well-being, and Educational Scholarship Accounts (ESAs), now reaching about 20 million students, are a critical positive step in this direction. When Texas passes ESAs, 25 million students will begin to have access to flourishing formative years instead of debilitating experiences that lead to lifelong damage. Of course, Trump’s support of school choice, still early and uncertain with respect to the details, also gives me hope.

Those who want to get them to join us in a cause of some sort always attempt to motivate us by claiming that unless we take action X, the bad thing will happen: If Trump is elected, we will lose our democracy, or abortion rights, etc. Yes, maybe so. Let’s look and see what the predictions are. If we have information that can lead to more accurate predictions, let’s make our own predictions based on our superior information.

I am very concerned about the possiblity of world war III. The markets are currently predicting a 25% chance of a war between major powers with a death count exceeding 10 million before 2050. That is indeed terrifying, and sadly plausible. It was 30% when the presidential elections took place in November, so happily it has come down slightly. What can I do about this? Other than encouraging more rationality and less hysteria in my own tiny way, I don’t see that I can do much.

I focus on making a positive difference with my wife with respect to African prosperity, on the one hand, and the wellbeing of children through my educational initatives, on the other. I seek to promote rational win-win solutions wherever possible. Freaking out about US politics just isn’t worth much intellectual or emotional bandwidth given where I can leverage my personal energies.