Goldman Sachs has indicated that Vice President Kamala Harris’ economic policies are unlikely to see significant changes if she becomes the Democratic presidential nominee. This assessment follows President Biden’s announcement that he would no longer seek the Democratic nomination, amid growing pressure after a shaky debate performance against Republican former President Donald Trump.
After Biden’s statement, he endorsed Harris, who expressed her intention to continue her campaign. She garnered high-profile endorsements from California Governor Gavin Newsom, Pennsylvania Governor Josh Shapiro, and New Jersey Governor Phil Murphy. Despite the leadership transition, Goldman analysts predict minimal changes in the Democratic fiscal and trade policy agenda.
Goldman’s chief economist, Jan Hatzius, noted that the chances of Democrats winning the White House could improve slightly but remain under 40%. The firm has highlighted that with the expiration of certain tax provisions from the Tax Cuts and Jobs Act set for the end of 2025, tax policy will become a central issue in the upcoming election.
Goldman’s projections for Biden’s fiscal policy include a proposed tax rate of 39.6% for individuals earning over $400,000, an increase from the current rates, and a potential corporate tax rate of 28%, although they express skepticism about Congress approving this figure, with a 25% rate seen as more likely. Additionally, Biden has proposed a 5% Social Security and Medicare tax on incomes exceeding $400,000, up from 3.8%.
If Harris secures the nomination, speculation suggests that governors Shapiro, Roy Cooper of North Carolina, Andy Beshear of Kentucky, and Arizona Senator Mark Kelly are among the top contenders for the vice presidential position.