Kamala Harris has increasingly stepped up to the plate as the leading voice on economic issues following President Biden's withdrawal from the 2024 presidential race. Public trust metrics have seen her reputation climb, with September polls showing 45% of registered voters trusting her to manage economic policy effectively, compared to 40% for Biden. Yet, lurking below these numbers is another political heavy-hitter: former President Donald Trump, who continues to hold significant sway over voters’ perceptions of economic competency.
This growing attention on Harris raises important questions about the effectiveness of current economic strategies and whether past critiques of Biden's policies, especially on inflation and growing inequality, have been valid. Harris, positioning her campaign as one for "an opportunity economy," emphasizes the idea of spending as investment. She proposes ambitious measures like the expansion of the Child Tax Credit and the creation of 3 million new homes. More than just promises, these proposals aim to alleviate financial burdens for everyday citizens.
Experts consulted by Capital & Main have highlighted the necessity of combining strong policies with clear communication. Darrick Hamilton, professor of economics at the New School, encapsulated this by emphasizing the need for articulative vision: "Policies matter, but they gain more traction when they're part of a larger story about what our economy should be and who we want to invest in. People are our greatest resource." Recent polls back this sentiment, showing widespread public agreement on increasing the minimum wage and taxing billionaires more heavily.
Specifically, attendees of progressive circles have voiced concerns over the unfinished work of Bidenomics, particularly the tax code originally established under the Trump era. Lindsay Owens from the Groundwork Collaborative pointed out the necessity to dismantle the trickle-down tax system which has yet to provide sufficient support for the middle class. Key components of the Trump-era Tax Cuts and Jobs Act are set to expire after 2025, which if not extended, would force higher taxes on the wealthiest by default.
Under Harris's plan, affluent Americans are facing stricter taxation measures. The Vice President advocates undoing Trump's tax cuts, proposing higher corporate tax rates and establishing minimum taxes on billionaires. Interestingly, Harris's plan does not touch Americans earning below $400,000, which draws mixed responses from economic analysts. While some see this threshold as sensible, others, like Heidi Shierholz from the Economic Policy Institute, believe it might be too high, potentially leaving many middle-income individuals still subject to increased costs—indirectly raising the discussion on the definition of wealth itself.
On another front, Harris has spotlighted the concept of the "care economy," addressing childcare, elder care, and healthcare access as pivotal economic sectors. Her plans encompass everything from capping out-of-pocket drug costs to introducing broader support for healthcare premiums, which aim to ease financial constraints for working families. The economic underpinning of these support systems goes hand-in-hand with proposals to raise wages for care workers, arguing for recognition of their integral role within the middle-class economy.
Following the impressive impact of the Child Tax Credit expansion, which was shown to halve child poverty rates, Harris has included the restoration and enhancement of this credit as part of her campaign. Research indicates the expanded Child Tax Credit kept millions of children out of poverty, and Harris aims to push this agenda forward, promising up to $6,000 for families with newborns. Advocates echo this call, reinforcing the idea of addressing general poverty, noting over 36 million Americans are currently living below the poverty line according to recent census data.
Meanwhile, concerns have emerged surrounding the potential backlash from another tax proposal positioned by Harris: the 25% unrealized gains tax on asset-holding millionaires—an idea raising alarm within financial circles, particularly among cryptocurrency investors. Zac Townsend, CEO of Meanwhile, expressed deep reservations about how such measures could provoke widespread sell-offs, leading potentially to decreased market valuations and diminished investments overall.
Such fears resonate with early investors facing punitive tax liabilities on unsold assets, sparking discussions on whether Harris's tax policies could inadvertently deter long-term investment. Townsend noted, "If the taxes force them to liquidate huge portions of their portfolios, it could flood the market and sharply drive down prices, impacting everyone’s investments. These high-profile investors had anticipated long-term gains, but now they face hefty tax bills simply due to appreciating asset values."
The tax reform conversation remains thickly layered with complexity, especially as many traditionalists have voiced criticisms over the radical departure from commonly accepted taxation principles which historically have only taxed realized gains—essentially gains acquired through sales. Critics argue the proposed tax could undermine the principles of investments, especially within the burgeoning fields of startups and cryptocurrency.
Beyond tax discussions, Harris has proposed comprehensive measures for economic relief, including restoring and augmenting elements from the American Rescue Plan, spearheaded by President Biden, which targets immediate financial relief for families through the expanded Child Tax Credit among other supports. These efforts are striving to be inclusive of tax credits meant to directly assist families and individuals, with proposals to offer credits for first-time homebuyers as well as easing the financial burdens associated with housing.
Harris's plans highlight her intention to collaboratively uplift America’s economic stature through ambitious proposals, but the execution of these ideas requires crossing the political aisles. With both strategic vision and tangible policies, she hopes to not only resonate with middle-class families but also to pave a way for sustainable economic growth.
The stakes are particularly high as mid-terms approach—a period during which both parties must reckon with the legacy of previous tax measures, economic health, and plans. Polls reflect heightened public anxiety around inflation and its tangible impacts, positioning economic issues as salient topics for upcoming elections.
So as the campaign gears up, all eyes remain on Harris. How she navigates the dual pressures of addressing economic inequality and fostering growth amid prevailing inflation will undoubtedly shape not just her political future but may also redefine economic equity for countless Americans. The conversation is no longer just about numbers on tax forms, but about the lives and livelihoods those policies will affect directly.
