VP Kamala Harris’s economic plans are specific and aimed at the middle class and working people while President Trump takes a broader view focusing on two national issues: immigration and tariffs. Harris on plans offer more for Black workers and the poor. big national issues. Harris has a set of detailed proposals. Trump prefers to focus on big national issues. Trump has an economic message focused on immigration and tariffs. Let see how they stack up.
Let’s compare proposals
Harris proposes a couple of big programs: expanding the child tax credit, increasing the earned income tax credit, raising corporate taxes (from 21% to 28%), and additional funding for the Affordable Care Act. She would let the Trump tax cuts expire and replace them with lower taxes on families making less than $400,000 per year. She would also give $25,000 in down payment assistance for first time home buyers.
Trump’s major proposes lowering the corporate tax rate, imposing tariffs on imported products, expanding energy production and restricting immigration. He also wants to reduce regulations and extend his tax cuts.
Let’s look at the economic impact
How will we do our analysis
Before we get started, we have to define who gets helped and who gets hurt by specific economic plans. We will look at four measures of a successful economic policy: Gross Domestic Product (GDP) growth, unemployment, and income distribution and support for African-Americans
When economists look at who prospers from the economy, they generally look at the growth of GDP and who receives the income from the economy. They also look at the long-run effects of any initiative. Gross Domestic Product (GDP) is everything produced by the economy.
Economist review unemployment against historical measures. We will look a Black unemployment which averages two times that of Whites.
Unemployment graph
Economist analyze income by dividing the economy into 4 groups. The poor (bottom 25%), lower-middle class (25%), upper-middle class (25%), and the rich (25%). Because the rich have done so well since 1980, they also look at the top 10% and 1% of the rich.
Graph of income distribution
Support for African Americans
Harris is the first national candidate to openly discuss programs that help African Americans specifically Black men. While none of the program are race specific (except for health care), she campaigns on the benefits to the Black community. Trump has few programs targeted to Blacks or the poor.
Overall Analysis
Harris’s policies have a larger social impact for the poor and both groups of middle-class people. She has programs that directly benefit all three groups with government assistance. Her plans are more narrowly tailored to solve specific problems in the current economy.
Trump’s plans take a broader view. He plans to reduce immigration and impose tariffs to bring back manufacturing helping the whole economy. Trump’s campaign believes resolving those big issues will improve the economy for everyone.
It is also not clear if either candidate’s plans, which have to pass Congress, are workable. Republicans would block Harris’s ideas in Congress and Democrats would block Trump’s plans with litigation. The stock market would also quickly veto Trump’s tariff plans.
Economic Growth
Harris’s plan to help the middle class would increase GDP more than Donald Trump’s. The bottom 75% of the economy spends more and consumes more than the rich. The rich invest more. Giving money to the middle class generally leads to higher GDP growth. You can see the effect with Biden’s “Receovery Act” after covid-19 when they directly stimulated the economy. <<>>
Trump has much wider ideas on making major changes to the US economy. His plans on tariffs and immigration would reduce GDP growth over the short and medium term. Tariffs are the equivalent of a national sales tax on the consumption of imported goods while immigration would limit labor and raise prices. However, over the long term, Trump’s ideas would help American workers by increasing jobs and wages for people in the United States.
Trump’s “Cheap energy” policy would also increase GDP and reduce inflation by making many products and services cheaper in the US.
We need to step back and look at the current situation of the US economy. The US economy is doing well. Unemployment is low, GDP growth is average, corporate profits are high and the stock market is near historic highs. The Federal Reserve has managed to avoid a recession. It is hard to see how any President, democratic or republicans, could steer of this course regardless of their proposals. <<>>
Unemployment
US national unemployment is 4.0% a historic low.
Both candidates do not talk about unemployment or what they would do during a recession. Trump’s plan to restrict immigration would positively affect US native born employment. The plans would also help African-Americans who directly compete against immigrants for jobs.
Harris has not put forward a plan to cope with unemployment. She would address immigration by passing the senate bill <<>>
Income Distribution
Trumps programs are income regressive, extending the tax cuts and jobs act, reducing the corporate pate tax rate to 15%. Restricting immigration would increase the wages of US residents. His
Harris’s economic plans are more income progressive. She wants a permanent child tax credit, expanded earned income tax credit, addition funding for the affordable care act and support for first time home buyers. She would let the trump tax cuts expire and replace them with cuts for the middle class.
Both candidates would implement their proposals though changes in the tax policy which must pass congress.
Support for African Americans
This one is a one-sided since Trump does not discuss economic policy related to Black people. Meanwhile, Harris has a slew of specific program that would benefit Black people in the in the US. To draw the proper contrast, we will list some of the proposals from Harris that benefit Blacks in the US. Trump literally has none. For a full list, please refer to the Harris Economic policy document.
Fund home healthcare workers as part of Medicare
$25,000 down payment assistance
For give student loan debt
$50,000 to start a business
A new Black men’s health initiative
Legalize marijuana
Expand child tax credit and EITC
Harris would study reparations
Increase the national minimum wage
Double apprenticeships
Increase taxes on corporate profits and capital gains
Support for childcare
Support unions and union organizing
Cap medical debt
Build 3 million new housing units
Additional funding for the Affordable Care Act.
The full list is available at KamalaHarris.com. The Trump campaign has not released any detailed economic proposals nor how they would implement changes in immigration, tariffs or energy policy.
Trump has no specific proposals aimed at the African American community. He proposes not taxing tips and opportunity zones.
What is important to note is that Harris has many specific proposals for the middle and working class while president trump prefers more of a message on economic issues. However, Trump’s message is that he cares about working people like us.
Economic tone and Intangibles
Harris has taken a more thoughtful and detailed approach to economic planning. She released an 83- page policy proposal and a separate plan specifically targeting black men.
Trump prefers to message votes with broad based appeals on immigration and tariffs. He favors extending tax cuts that
Polls
Polls report that 62% of people believe the economy is in bad shape (AP/NORC). And 52% percent believe the US economy is the most important issue (Gallup).
Polls have consistently shown that people believe Donald Trump will be better for the economy. In the survey, 54% believe Trump would handle the economy better vs. 45% for Harris supporters (Gallup)
Expert opinions
Let’s review the expert opinions on Trump’s and Harris’s economic proposals.
Goldman Sachs has given a positive review of Harris’s plan, but the report is publicly unavailable. Second hand information from: Spectrum News, Reuters and NY Daily News, revels the very favorable view of VP Harris’s economic ideas. The publicly was so favorable that the CEO of Goldman Sachs, David Solomon, walked back the reports statements saying that both candidates would have similar effects on the US economy.
Moody’s Investment Service has made an assessment of both economic plans (Moody’s). Moody’s has “star” economist mark Zandi. Moody’s uses the Biden 2025 budget proposals for their models. Moody’s calls the election 50/50, but does give a more favorable appraisal of Harris economic policies.
Center for Fiscal Responsibility
Penn-Wharton budget model (PWBM) compares Harris and Trump directly. The PWBM focuses on budgets and spending. The model estimate that under Trump spending would expanding the national debt by about $6 billion over ten years while increasing by only $1.2 billion for Harris.
Sixteen Nobel Laurates also endorsed VP Harris’s economic initiatives, believing trumps plans would cause inflation.
Summary
Each plan has something to offer voters, the Harris plan aims for middle-class people while Trump’s plan would help voters over the long term. Harris would maintain growth while Trump’s plans would have a short term reduction in GDP growth and increase inflation. It really depends on what you think is important in the economy to you and to the country.