The News
From child tax credits to cutting grocery bills, Vice President Kamala Harris released a slew of economic positions Friday that gave voters the first insight into how the Democratic presidential candidate would handle the economy if elected. These include offering a tax credit for families with newborns, canceling medical debt, lowering prescription drug costs, and banning grocery store price gouging.
Some Democratic leaders have argued that an “aggressively populist” agenda is necessary to beat former President Donald Trump, The Washington Post reported. Inflation and the economy have consistently polled as a top concern for voters. As of July, a YouGov survey showed Americans were more likely to trust Trump to handle the issues than Biden, but a new poll conducted this month showed Harris leading her opponent on the matter. Trump’s positions on the economy include cutting the corporate tax rate, bolstering border security, and removing red tape on oil, natural gas, and coal projects.
Harris detailed her economic agenda Friday during a speech in North Carolina — a swing state — days before the Democratic National Convention in Chicago, saying that Trump’s recently announced economic plan would “devastate the middle class, punish working people and make the cost of living go up for millions of Americans.”
SIGNALS
Grocery price gouging ban is receiving mixed reviews
Some prominent center-left economic policy bloggers agreed that a price gouging ban is more of a populist idea than a substantive policy. “Price controls on food are a terrible idea,” Noah Smith wrote in his Noahpinion Substack, arguing that they could cause food shortages and worsen inflation and political instability. However, Josh Barro argued in his Very Serious newsletter that while it was a “dumb” idea, it was the kind of popular one that helps win elections, especially as laws against price gouging poll well with voters. While candidates usually end up backtracking on such policies or fail to get them passed, Smith noted that Harris’ vow to enact the ban in the first 100 days of her presidency signals she is serious about it.
Harris’ plan comes with an unclear cost
Harris’ proposals include a $6,000 tax credit for families with newborns during the first year of the baby’s life, and reinstituting a pandemic-era tax credit that raised the benefit for families from $2,000 per child to $3,000. These two policies could cost $1.2 trillion over 10 years, Marc Goldwein of the Committee for a Responsible Federal Budget told The Washington Post. “America is on a fiscally unsustainable path, and if we’re going to embark on some of the more ambitious programs she’d like to pursue we need more revenue,” tax policy expert Daniel Hemel told the Post. At the same time, he said, “sacrificing on fiscal policy” in the short term may be worth it to win the presidency.