Kamala Harris’ economic strategies are expected to remain largely consistent if she secures the Democratic presidential nomination, according to Goldman Sachs.
A recent Coinbase poll indicates that Harris and former President Donald Trump are closely competing for the support of cryptocurrency voters.
On Sunday, President Biden announced his withdrawal from the Democratic nomination race, following intense pressure to step aside after a challenging debate performance against Trump. Following his announcement, Biden endorsed Vice President Kamala Harris, who expressed her intent to continue her campaign and received endorsements from notable figures such as California Governor Gavin Newsom, Pennsylvania Governor Josh Shapiro, and New Jersey Governor Phil Murphy. However, this change is not anticipated to significantly alter the party’s policy direction.
Goldman Sachs analysts, led by chief economist Jan Hatzius, stated in a report that they do not expect any substantial shifts in the Democrats’ fiscal and trade policy agenda should Harris become the nominee. The transition to her candidacy marginally improved the Democrats’ chances of retaining the White House, which now stands at just under 40%.
The firm highlighted that the expiration of the personal income tax provisions from the Tax Cuts and Jobs Act at the end of 2025 will make taxes a central fiscal issue in the upcoming elections. The next president will influence whether these cuts are extended or if new taxes are introduced.
Goldman Sachs provided a few specific forecasts for fiscal policy should Biden win reelection:
– 39.6%: Proposed tax rate for individuals earning over $400,000, an increase from the current 35%/37%.
– 28%: Biden’s suggested corporate tax rate, up from the current 21%; Goldman expressed skepticism about Congress agreeing to this and indicated a more likely rate of 25%. In contrast, Trump has proposed reducing the rate to 20%.
– 5%: Proposed increase in the Social Security and Medicare tax rate on incomes exceeding $400,000, up from the current 3.8%.
If Harris secures the nomination, prediction markets indicate that potential candidates for her vice presidential running mate could include Governors Shapiro, Roy Cooper of North Carolina, Andy Beshear of Kentucky, or Arizona Senator Mark Kelly.