Goldman Sachs suggests that if Kamala Harris becomes the Democratic presidential nominee, her economic policies are unlikely to differ significantly from those of President Biden. Following a shaky debate performance against former President Donald Trump, Biden announced he would not seek the Democratic nomination and endorsed Harris, who has confirmed her intention to run. She has also received endorsements from several prominent figures, including California Governor Gavin Newsom and Pennsylvania Governor Josh Shapiro.
Goldman’s analysts indicate that a Harris nomination wouldn’t result in major changes to the Democratic fiscal and trade policy agenda. They project that the odds of a Democratic victory in the upcoming election have increased slightly but still remain under 40%. Furthermore, researchers from Goldman highlighted that the focus on taxes will become prominent next year, especially with key provisions of the Tax Cut and Jobs Act set to expire at the end of 2025, which will significantly affect the next administration’s fiscal decisions.
Specific projections for fiscal policy include a proposed tax rate of 39.6% for individuals earning $400,000 or more, an increase in the corporate tax rate to 28%, which Goldman doubts Congress would approve, suggesting a more likely rate of 25%, and a rise in the Social Security and Medicare tax rate for high earners from 3.8% to 5%.
If Harris secures the nomination, potential candidates for the vice presidential slot could include governors like Josh Shapiro of Pennsylvania, Roy Cooper of North Carolina, Andy Beshear of Kentucky, or Senator Mark Kelly of Arizona.