Harris’s speech on Friday was a departure from her previous campaign events, as she chose to address a smaller group of around 250 supporters. This allowed her to outline her economic policies in more detail, focusing on reducing costs for American families. It marked a shift in her campaign strategy, indicating a move towards engaging with smaller audiences and providing more specific information about her legislative and executive plans.
Harris emphasized the importance of building an “opportunity economy,” where everyone has the chance to create wealth for themselves and their families, regardless of their background. She also introduced several economic policies that went beyond President Joe Biden’s promises, demonstrating her unique approach to key issues.
These proposals included eliminating medical debt, banning price gouging for groceries, capping prescription drug costs, providing subsidies for first-time home buyers, and increasing the child tax credit. The release of these policy positions just before the Democratic National Convention showcased Harris’s vision for economic policy if she were to be elected president. Her proposals indicated a departure from a more centrist approach and aligned with the Democratic Party’s transformation under Biden’s leadership.
Prior to this event, Harris’s campaign speeches had focused on broader themes and criticisms of Donald Trump and the Republican Party. However, Friday’s speech provided a more detailed insight into her economic policies and personal experiences growing up in a middle-class household.
Overall, Harris’s address on Friday marked a significant shift in her campaign strategy, signaling a more focused and detailed approach to engaging with voters and outlining her governing priorities.
Harris’s policy positions have significantly changed since she first ran for the Democratic presidential nomination in 2019. At that time, she embraced several progressive policies to stand out among other contenders, but she has since rejected some of them, such as a single-payer health-care system and banning fracking and offshore drilling.
Now, Harris faces the challenge of maintaining the momentum of her campaign while unveiling concrete policies to demonstrate her seriousness as a candidate. During a press call hosted by the RNC and the Trump campaign, Kevin Hassett, former chairman of the Council of Economic Advisers in the Trump administration, criticized Harris’s plan for price gouging as “completely preposterous.”
“The proposal is very unfortunate,” he said. “It could cause an enormous amount of damage to the economy and reveals a desire for government control over the economy.”
In the weeks leading up to this announcement, at least two outside advisers privately suggested that Harris signal a move to the center by supporting income tax cuts for middle-class households or a tax break for small businesses. However, those suggestions were not included in the final package.
The plan also alludes to cutting “red tape” and lowering the deficit but provides no specifics. It’s not entirely clear how much Harris’s sweeping new proposals would cost.
Estimates released by the Committee for a Responsible Federal Budget (CRFB) show that the plan would increase deficits by $1.7 trillion over a decade. That cost would grow to $2 trillion if Harris’s housing policies were made permanent.
Roughly $1.2 trillion of that bill would come from an expansion of the child tax credit, according to the CRFB. Another $400 billion stems from enhanced health insurance subsidies, and $150 billion comes from expanding the Earned Income Tax Credit.
Another $200 billion comes from support for affordable housing and credits to help first-time home buyers. The campaign says its plan would be paid for through taxes on corporations and some of America’s highest earners, along with other revenue raisers in Biden’s budget. But there were few other specifics as of Friday, leaving open questions on the final price tag and potential risks of inflation.
Harris’s policy push was met with criticism within her own party. Policy experts lamented her recent endorsement of Trump’s plan to eliminate taxes on tips and her promises not to raise taxes on Americans earning under $400,000 per year — positions they see as incompatible with Democrats’ ambitions to approve major new expansions of the nation’s safety net. Despite these drawbacks, Democrats have become increasingly convinced that embracing populist economics is key to beating Trump — their top priority through November.
Concerns about the economy and inflation have ranked among voters’ top issues in the 2024 presidential election, and polling has consistently shown that attacking corporate price gouging is popular.
“Vice President Harris faces a dilemma: On one hand, America is on an unsustainable fiscal path, and if we’re going to embark on some ambitious programs she’d like to pursue, we need more revenue,” said Daniel Hemel, a tax policy expert at New York University School of Law. “On the other hand, democracy is in peril, and that crisis feels more imminent than the fiscal crisis.”
Perhaps Harris’s most surprising policy announcement was her plan to ban “price gouging” in grocery and food prices. While details were scarce
The proposal would allow the Federal Trade Commission to impose significant fines on supermarkets that impose “excessive” price increases on customers, according to her campaign. Grocery prices continue to be a major concern for voters: Although the rate of increase has stabilized this year, grocery prices have risen by 26 percent since 2019, as reported by Elizabeth Pancotti, director of special initiatives at the Roosevelt Institute. However, even some Democratic economists were hesitant about that idea and hoped that it was merely political messaging.
Economists generally argue that mandatory price-setting leads to shortages by reducing incentives for companies to produce supply, and is the kind of measure less likely to have been supported under the Clinton or Obama administrations. Biden aides have argued that some markets have been distorted by consolidation and need government intervention to be rebalanced in favor of consumers. Regarding housing, Harris did not deviate much from the Biden administration but chose a more active set of federal proposals than those endorsed by the White House so far.
Harris supported a range of measures to increase housing supply, including expanding tax credits to encourage housing construction, as well as providing new $25,000 in federal down-payment assistance to over 1 million first-time home buyers. (Biden had previously proposed a more limited measure only for first-generation home buyers.) Critics argue that this plan would likely drive up housing prices, which have already surged since the pandemic. Harris also promised to collaborate with states to eliminate medical debt for millions of Americans, building on one of her key policy issues as vice president. This effort could involve using federal funds to purchase and forgive outstanding medical debt from health providers.
Harris’s office also recently collaborated with the state of North Carolina on an unprecedented initiative to forgive the medical debt of 2 million state residents by creating financial incentives for hospitals to relieve medical debt or prevent it from accumulating in the first place. This initiative received federal approval last month, and all 99 eligible hospitals in North Carolina have since committed to participate — a potential model for other states.
