Goldman Sachs analysts predict that Vice President Kamala Harris’ economic policies would not differ significantly from those of President Biden if she becomes the Democratic presidential nominee. Following calls for Biden to step down after a less-than-stellar debate with former President Donald Trump, he announced on Sunday that he would not seek re-election, subsequently endorsing Harris. She has expressed her intention to continue her campaign, garnering support from prominent figures such as California Governor Gavin Newsom and Pennsylvania Governor Josh Shapiro.
Goldman Sachs noted that while Harris’ nomination might slightly improve the Democrats’ chances of winning the presidency, the overall probability remains just under 40%. The analysts emphasize that the Democratic fiscal and trade priorities are unlikely to change significantly. With the expiration of certain tax cuts set for the end of 2025, the next administration will play a crucial role in determining tax policies.
Among the key fiscal policy predictions by Goldman are a proposed increase in the tax rate on individuals earning $400,000 or more to 39.6%, a potential rise in the corporate tax rate to 28%, and an increase in the Social Security and Medicare tax rate on high-income individuals to 5%.
In terms of potential vice presidential candidates, prediction markets suggest that governors Shapiro, Roy Cooper, Andy Beshear, or Arizona Senator Mark Kelly are leading contenders.