Prior empirical and modeling investigations of the impacts of forest thinning on hydrology and tree health tend to focus on monoculture forests in arid environments. This leaves critical gaps in our knowledge of how thinning will impact mixed-species forests in other climates. The goal of this study is to present new process-informed hypotheses for how Net Primary Productivity (NPP), Transpiration (T), and hydraulic stress of individual tree species in mixed species stands across forested regions of the US would respond to thinning of canopy tree species. We simulated thinning in seven forests across the US spanning Aridity Indices 0.58 (energy limited) to 2.88 (water limited). Our modeling confirms several widely held hypotheses that thinning reduces hydraulic stress across all trees in all climates and increases landscape water yields. In contrast with prior experiments employing annual metrics such as tree ring width records, our modeling suggests that changes in annual average forest growth or transpiration after thinning may not be correlated with changes in the magnitude of hydraulic stress experienced during drought. We present these hypotheses with the expectation that they can be challenged critically through coupled model and field thinning experiments to test all documented assumptions.