Harris Steps Up: What Does Biden’s Exit Mean for 2024?

Goldman Sachs has indicated that Vice President Kamala Harris’ economic plans are likely to remain consistent with President Biden’s if she becomes the Democratic presidential nominee.

In related news, McDonald’s is facing its first lawsuit linked to the recent E. coli outbreak involving its Quarter Pounder burgers.

On Sunday, President Biden announced he would withdraw from seeking the Democratic nomination amid increasing pressure for him to step down following a disappointing debate performance against Donald Trump. Shortly after his announcement, Biden endorsed Harris for the nomination, which she accepted, receiving endorsements from notable figures such as California Governor Gavin Newsom, Pennsylvania Governor Josh Shapiro, and New Jersey Governor Phil Murphy.

Goldman Sachs analysts, led by chief economist Jan Hatzius, noted that they do not expect significant changes in the Democrats’ fiscal and trade policies with Harris as the nominee. They estimated that the chance of Democrats winning the White House under her leadership increased slightly but remained below 40%.

Goldman researchers previously highlighted that tax policy will be a significant focus in the coming year, especially with the expiration of certain provisions of the Tax Cut and Jobs Act by the end of 2025. The winner of the election will have critical decisions to make regarding the extension of tax cuts or the introduction of new taxes.

The firm outlined several forecasts regarding fiscal policy if Biden were to win reelection. They reported that Democrats are contemplating a tax increase to 39.6% for individuals earning over $400,000, up from current rates of 35% and 37%. Additionally, Biden has proposed raising the corporate tax rate to 28% from 21%, although Goldman expressed skepticism about Congressional approval for such a hike, suggesting a more feasible outcome might be a 25% rate. There is also a proposed increase in the Social Security and Medicare tax rate for incomes above $400,000, from 3.8% to 5%.

If Harris secures the nomination, speculation surrounds potential vice presidential candidates, including Governors Shapiro and Roy Cooper of North Carolina, Andy Beshear of Kentucky, and Senator Mark Kelly from Arizona.

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