Goldman Sachs suggests that Vice President Kamala Harris’ economic policies will largely resemble those of President Biden if she secures the Democratic presidential nomination. Following Biden’s announcement on Sunday that he will not seek reelection, amidst increasing pressure to step aside after a disappointing debate against former President Donald Trump, he endorsed Harris. She has since expressed her intention to continue her campaign and has garnered support from prominent figures including California Governor Gavin Newsom and Pennsylvania Governor Josh Shapiro.
Goldman analysts, led by chief economist Jan Hatzius, predict minimal changes in the Democratic fiscal and trade policy agenda, even with Harris as the nominee. They estimate that the likelihood of Democrats winning the presidency has increased slightly but remains just under 40%.
Looking ahead, Goldman has indicated that tax policies will be a primary focus next year, particularly with the expiration of certain provisions from the Tax Cuts and Jobs Act scheduled for the end of 2025. The upcoming election will determine whether these tax cuts are extended or if new taxes are introduced.
Key fiscal policy predictions from Goldman include a proposed tax rate of 39.6% for individuals earning over $400,000, a corporate tax rate increase to 28%, and an elevated Social Security and Medicare tax rate of 5% for incomes above $400,000.
If Harris does become the nominee, speculation suggests that the vice presidential slot might go to Pennsylvania’s Governor Shapiro, North Carolina’s Roy Cooper, Kentucky’s Andy Beshear, or Arizona Senator Mark Kelly.