Goldman Sachs has indicated that if Kamala Harris becomes the Democratic presidential nominee, her economic policies are unlikely to differ significantly from those of President Joe Biden.
On Sunday, President Biden announced he would not seek re-election amidst growing pressure following a lackluster debate performance against former President Donald Trump. Shortly after, he endorsed Vice President Kamala Harris, who expressed her intent to continue her campaign. She has gained support from several prominent figures, including California Governor Gavin Newsom, Pennsylvania Governor Josh Shapiro, and New Jersey Governor Phil Murphy. However, analysts at Goldman Sachs predict that there will be little change in the Democrats’ fiscal and trade policy agenda if Harris takes the lead.
Goldman stated that while Harris’ nomination would slightly increase the Democrats’ chances of securing the White House, those odds are still below 40%. The firm highlighted that upcoming tax policies will play a central role, particularly as the personal income tax provisions from the Tax Cuts and Jobs Act are set to expire by the end of 2025. The outcome of the upcoming election will significantly influence decisions regarding tax extensions and the introduction of new taxes.
From Goldman’s forecasts for fiscal policy should Biden win, they noted some key figures: a proposed tax rate of 39.6% for individuals earning over $400,000, an increase in the corporate tax rate to 28% from the current 21%, and a raised tax rate of 5% on Social Security and Medicare for incomes exceeding $400,000.
If Harris becomes the nominee, speculation surrounds potential candidates for the vice presidential position, with Pennsylvania Governor Shapiro, North Carolina Governor Roy Cooper, Kentucky Governor Andy Beshear, and Arizona Senator Mark Kelly being considered the most likely choices.