Harris’s economic plan is missing one big thing: boldness. She is missing a chance to shape the US national economic discussion for years to come. The plan: “A New Way Forward for the Middle Class,” lists over forty ideas for supporting home ownership, small business, taxes, and reducing inflation. She would also expand Biden’s policies promoting child tax credits, cutting student loan debt, and subsidizing the Affordable Care Act.
The plan was delivered during a speech at Carnegie Mellon University where she talked about creating an “Opportunity Economy.”
The U.S. economy is doing great compared to the rest of the world. US GDP growth exceeds all other Western nations and our inflation rate is among the lowest. But the reality is that average voters in swing states have not felt much improvement. Harris needs to discuss long-term economic goals for the United States.
What the Karris Economic Plan does not discuss
The plan is missing big, bold, aspirational ideas to drive the Black economic discussion forward. This is a huge, lost opportunity to influence the ideas people think about. The President shapes the agenda for the US economy and the legislation put forward to Congress. The President and the media also have an outsized role in defining what the public thinks about the economy.
Today we are looking at what is missing in the Harris economic plan. After spending time listening to Harris discuss her economic plans, reviewing related websites, reading transcripts, and checking other commentary, you can’t help but notice gaps in the proposals. You start to wonder about the big issues that don’t get talked about.
We have noticed three areas absent from Harris’s economic discussions: (1) How will VP Harris handle difficult economic issues, like creating good jobs? (2) How she will manage an economic crisis like the mortgage crisis? (3) How will she demonstrate inspirational economic leadership? Where are the big, new ideas? What are the long-term ideas? The need for quality jobs and reducing inequality are not going away.
Great candidates set inspirational goals. Candidates put “a chicken in every pot,” but great candidates tie their economic policies to the bigger, long-term picture. They embody our aspirations. They answer the “Why” question. JFK had civil rights and put a man on the moon. LBJ had a ‘War on Poverty.’ And Reagan said, “Government is the problem.” Instead, we get a $25,000 new buyer tax credit and cheap gasoline.
She is missing a gigantic opportunity.
Here are some other key topics avoided by the Harris economic plan:
Harris’s economic proposals lack boldness. Harris does not tackle big, long-term issues. Jobs are plentiful but good jobs are not. In many industries, the career ladder is broken and more education is not the answer. There is also a looming crisis in discretionary social programs, immigration policy is a problem, and lack of opportunity and inequality continue.
How to create middle-class jobs: Creating middle-class jobs has been a core economic issue for the past 40 years. All political campaigns discuss this issue. Middle-class jobs have dropped since the 1990s because of corporate cost-cutting and outsourcing. No candidate left or right has figured out how to create good jobs.
President Trump has less of a plan and more of a message. His two central themes are reducing immigration and imposing higher tariffs. Economists view tariffs as a tax on consumers.
Harris would offer incentives to small businesses, support unions, and increase apprenticeships. However, neither candidate discusses how difficult it is to create middle-class jobs. Both sides are ignoring the biggest issue in a modern, service-oriented economy.
Inequality: Neither candidate discusses inequality directly, but both are aware of the issue. Trump often uses the rhetoric of zero-sum, us against them; “they win, you lose,” while Kamala discusses how she will help build the middle class.
Over the past 45 years, the U.S. has split between high-income workers and those at the bottom. The middle class has been hollowed out, dropping from 61% in 1971 to 50% in 2021. (Pew Research)
Immigration: Harris has not discussed immigration in economic terms. Immigration benefits the country as a whole but hurts workers in specific industries. She never discusses the level and type of immigration that might benefit the economy and what she would do to protect native-born workers.
National debt: No discussion of the national debt. Does the debt even matter? Her plans increase the debt at a lower level than President Trump’s proposals. The CRFB estimates Harris would increase the national debt by $3.5 Trillion over 10 years. Trump would increase the debt by $7.5 Trillion during the same period.
Medicare, Medicaid, and Social Security: Large social programs that help children, the elderly, and the poor face funding challenges over the next 10 years as the US population ages. Spending on social programs continues to outpace revenue and increase the national debt.
The Environment: There is little mention of the environment and no mention of specific energy policies beyond clean energy. She takes credit for expanding energy production under the Biden administration (the US is currently the largest energy producer in the world). Kamala fails to mention how destructive it might be for the environment.
Trump offers “Cheap Energy,” a cornerstone of his economic policy. He gives no details other than cutting regulations.
Military budget: The U.S. spends $820 billion on the military (Fiscal Year 2023). We are approaching the $1 trillion level (2031). There has been no discussion of the huge military and homeland security budget ($183 billion in FY 2023).
Housing affordability: There is no detailed discussion of housing, rent, zoning, affordable housing, or building public housing. Only a crackdown on landlords.
Price controls: There is no specific discussion of reducing rent inflation such as price controls on rent or staples like groceries. While most economists hate them on principle, they work in many places. Biden proposed a national 5% cap on rental price increases.
Industrial Policy: No one wants to say “industrial policy,” but the U.S. is the only major Western democracy without one. In the U.S., we have a “free-market” streak and believe the market will sort things out. Interestingly, both candidates quietly agree on some form of industrial policy. Both see a need to support key industries of the future (AI, clean energy, and data centers) while limiting the abuses of China.
Infrastructure policy: The candidates don’t even mention the word “infrastructure.” They are content to let Biden’s Inflation Recovery Act ride.
Educational funding: There has been no talk of educational funding beyond student loan forgiveness. And, even worse, they don’t talk about how to improve educational outcomes.
Government efficiency and effectiveness: This is always one of our big issues. The government has to work better at delivering services. This has been one of the greatest lost opportunities in the U.S. economy. It is a complex issue, but the goal is clear. Clinton-Gore had reinvented government. Since then, it’s been slash-and-burn Republicans or look-the-other-way Democrats. We have to get better.
Conservative Ideas: We would like to see a progressive Democrat at least discuss some conservative ideas. Not just patriotism, the military, and the police. There are plenty of topics to discuss that are left of the table: school vouchers, tax reform, or social media regulations. But what is most important is returning conservatives to their traditional “Watchdog” role and participating in governing.
Summary
Harris is missing a great opportunity to set the national economic agenda. Even if she loses., her ideas will stick around. The child tax credit is a great example. It reduced child poverty by 50%. So are vocational training and doubling apprenticeships.
She is missing a huge opportunity to set the national economic agenda for years to come.