Claims that former U.S. President Donald Trump is a threat to the country's democracy have been weakened by the legacy of his first term, historian Niall Ferguson said Friday.
"I think this whole argument that Donald Trump was going to end democracy and establish some kind of American fascism was blown up because of the way his first term went. Remember, all these things were said in 2016, that Trump would be a tyrant," Ferguson told CNBC's Steve Sedgwick at the Ambrosetti Forum, an annual economic conference held in Italy.
"The great weakness, in my view, of Trump's case has always been his conduct on January 6, 2021 and his attempt to overturn the outcome of the 2020 election, this I thought was the end of his political career. I was dead wrong, he's back," Ferguson continued.
Jan. 6, 2021 saw dramatic scenes of rioting, vandalism and looting at the U.S. Capitol, which began as protests against Trump's loss to President Joe Biden in the 2020 presidential election.
A select committee report released in 2022 found Trump made repeated attempts to "delegitimize the election process," made false claims about the legitimacy of the result, and performed a "dereliction" of duty by refusing to call off the mob.
"I think the key point that one has to make here is that the system contained Trump's impulses in 2020, 2021, successfully, and I think it would contain them again if he were to be only the first person since Grover Cleveland to have two non-consecutive terms as president," Ferguson said, referring to another former U.S. president.
Ferguson, the Milbank Family Senior Fellow at the Hoover Institution and author of books including "The Ascent of Money," said that despite this, ordinary U.S. voters would now view Democrat claims that Trump threatens democracy as less compelling than before — not least because they have already experienced a Trump presidency.
Trump continues to face a federal criminal case over election interference. He has been embroiled in numerous wider scandals, including being found liable for sexual abuse in a civil case, being found guilty in a case related to hush money payments paid to porn star Stormy Daniels, and being ordered to pay hundreds of millions in a civil fraud case.
Ferguson told CNBC on Friday that Trump's opponent, Democratic presidential nominee Kamala Harris, would struggle with the fact that she has served as vice president to Joe Biden.
He argued this was because while the U.S. economy has continued to grow strongly, many voters are dissatisfied with how high inflation rose inflation and the upticks in both legal and illegal immigration in recent years.
On the economic consequences of the upcoming vote, Ferguson said the meaningful differences between Trump and Harris were their policy proposals on taxation and regulation.
Harris this week proposed a 28% tax on long-term capital gains for households with an annual income of $1 million or more, lower than the 39.6% rate Biden put forward in his 2025 fiscal year budget. The top rate for long-term capital gains, or assets owned for more than one year, is currently 20%; Trump has proposed a reduction to 15%.
Whoever wins the November election will be dealing with a massive "fiscal problem," Ferguson continued, describing the size of the U.S. deficit as being in a "situation of unsustainability."
"Trump is not going to deal with it by raising direct taxes. I think Harris would deal with it by raising taxes. Trump's argument is, I can deal with this by raising the growth rate. And he's got, in some sense, an argument to make there, because the economy under Trump performed well in the sense that it both grew and it wasn't inflationary," Ferguson said.
— CNBC's Rebecca Picciotto contributed to this story.
