Goldman Sachs analysts suggest that Vice President Kamala Harris’ economic policies are unlikely to differ significantly from President Biden’s if she becomes the Democratic presidential nominee.
Biden announced on Sunday that he would not seek reelection, following mounting pressure after a weak debate against former President Donald Trump. In his statement, he endorsed Harris, who expressed her intention to run and received endorsements from several prominent figures, including California Governor Gavin Newsom and Pennsylvania Governor Josh Shapiro.
Goldman’s chief economist Jan Hatzius noted that the Democrats’ fiscal and trade policy agenda is expected to remain largely the same under Harris. The firm estimates that the probability of Democrats winning the presidency has increased slightly but still stands at just below 40%.
As the expiration of tax cuts from the Tax Cuts and Jobs Act approaches in 2025, tax policy will likely become a significant focus in the upcoming elections. Goldman predicts potential tax increases, including a proposed 39.6% tax rate for individuals earning over $400,000 and a corporate tax hike to 28%, although they express skepticism about Congress agreeing to such rates.
If Harris secures the nomination, bettors currently favor several governors, including Shapiro and North Carolina’s Roy Cooper, as potential choices for her running mate.