What McKinsey Can Learn From MAGA's Insider Signals

The real signal isn't in the speeches. It's in the contracts. When political rhetoric promises a new era, the smart money looks for who gets paid to make it happen. The disconnect is stark: the loud promises of a "America First" agenda are matched by the quiet, multi-billion dollar work of firms like McKinsey & Company, which have a long history of executing political mandates, regardless of the administration.

Consider the blueprint. In 2017, just days after President Trump's inauguration, Immigration and Customs Enforcement (ICE) turned to McKinsey to help implement his clampdown on illegal immigration. The firm, already on the payroll from the Obama era, was redirected to figure out how to cut costs and scale up detention operations. The recommendations were blunt: proposals to cut spending on food, medical care, and supervision for detainees. This isn't hypothetical. It's a documented case of a consulting giant taking a political directive and turning it into a bottom-line exercise. The alignment of interest here was clear: the client (the government) wanted results, and McKinsey delivered the operational plan. That's the playbook.

This model extends far beyond domestic policy. McKinsey's global reach is defined by its work for powerful state clients, often in areas of high conflict. Since 2008, the firm has been awarded upwards of $940 million worth of federal contracts, with the Pentagon as its top client. This isn't just advisory work; it's deep integration into national defense, from evaluating the F-35 program to advising on Air Force technology. The firm's own website boasts of long-standing relationships with ministries and departments of defense worldwide, including advising weapons manufacturers in Russia and state-owned engineering firms in China. These are the opaque, high-stakes relationships where real capital flows, and where the firm's "skin in the game" is its reputation and its next contract.

Now, fast forward to the present. The latest executive orders from the Trump administration signal a new focus: resource nationalization. The January 9 order targeting Venezuelan oil revenue is a prime example, asserting U.S. control over sovereign funds. This aligns with the broader "America First" theme of Project 2025. The smart money isn't hyping this agenda; it's watching for who gets hired to manage the fallout. Firms with the expertise to navigate complex state-owned assets, advise on national security implications, and execute large-scale operational changes are the ones positioned to benefit. McKinsey's history shows it doesn't wait for a mandate; it builds the relationships and the capability to deliver when one arrives. In a world of political promises, that's the only true signal that matters.

The Insider's Dilemma: Conflicts and Catalysts

The political shift creates a classic insider's dilemma: a wave of new mandates, but with the operational details still foggy. Smart money isn't rushing in; it's waiting for the fog to lift. The catalysts are clear-the record-breaking shutdown, the tariff overhang, and the rapid implementation of a sprawling blueprint-but the path through the uncertainty is what matters.

First, the operational chaos. The 35-day government shutdown wasn't just a political standoff; it was a data black hole. Major economic reports were delayed, leaving investors without the real-time signals needed to price risk. In a vacuum, smart money avoids the noise. This isn't a new tactic; it's the default position when the fundamentals are obscured. The shutdown created a period of pure uncertainty, and the disciplined players stayed on the sidelines, watching for the first reliable data to reappear.

Then there's the tariff threat, which is top of mind but poorly planned for. Executives are aware of the potential for increased tariffs, but few have developed robust plans for the second-order effects. This is a classic setup for a selective opportunity. The smart money isn't betting on a broad market move; it's looking for companies with the agility to pivot supply chains or the pricing power to absorb costs. The firms that have already built that resilience will be the ones to benefit when the next tariff announcement lands.

The most significant catalyst, however, is the rapid execution of Project 2025. The blueprint's 920 pages are being implemented at speed, with roughly half of its goals already enacted. This isn't a future policy; it's a present-day mandate. The smart money is watching for the specific contracts and hires that follow. As the evidence shows, the people put in charge-the "personnel"-are the ones shaping the ideology and the opportunities. When a key architect like Russell Vought or a trade adviser like Peter Navarro moves into a position of power, the real work begins. The smart money isn't reading the manifesto; it's tracking who gets the first assignment.

The bottom line is that political shifts create volatility, but they also create winners and losers. The insiders know the playbook: wait for the data to clear, identify the firms with the operational plans, and position for the specific mandates being executed. In this environment, patience and precision are the only true signals.

What to Watch: Institutional Accumulation and Whale Wallets

The smart money's caution is a waiting game. The real signal will come from where capital flows next. Watch for two clear patterns: a rotation into sectors aligned with the new agenda, and a direct read on the alignment of interest within the firms that will execute it.

First, monitor institutional accumulation. The 2024 GOP platform's "Drill, Baby, Drill" energy policy is a concrete driver. This isn't just rhetoric; it's a policy directive that could reshape the energy sector. Look for 13F filings showing increased buying in oil and gas exploration, pipeline, and energy infrastructure companies. This would signal that the smart money is positioning for a sector rotation fueled by resource nationalism and a push for energy independence. Conversely, watch for selling in firms with heavy exposure to the regulatory overhauls being implemented. The rapid dismantling of federal diversity, equity, and inclusion (DEI) programs, as outlined in Project 2025, creates a headwind for consulting firms and tech companies that have built significant practices around these initiatives. A whale wallet dumping shares in such firms would be a stark signal of a loss of future contract visibility.

Second, track insider trading in the firms with the heaviest government contracts. This is the ultimate test of skin in the game. When a company like Lockheed Martin or Raytheon gets a major Pentagon contract, the CEO's stock sales or purchases are a direct read on their confidence in that work continuing. A pattern of consistent insider buying amid the political shift would confirm alignment of interest. A sudden wave of sales, however, would be a red flag that insiders see a risk-perhaps in the form of budget overruns, political interference, or a shift in priorities-that the public hasn't yet priced in. The smart money isn't betting on the political promise; it's watching the filings to see if the people with the most to lose are betting against it.