The economy has been a key focus of campaign messaging this week. Both candidates for office are seeking to assure voters that they can improve the fortunes of the working and middle classes. This comes amid a new burst of energy in the Democratic camp from Kamala Harris’s now firm position at the top of the Party. Team Harris said they had raised $200 million in one week – two-thirds reportedly from first-time donors. Her opponent, meanwhile, is once again courting controversy. Trump’s remarks to Fox News that voters would never need to vote again if he became President were the subject of much press attention this week.
Campaign Catch-up
Kamala on course
Harris held a rally on Tuesday in Atlanta, where she has built close connections with campaign organisers and Black community leaders as Biden’s chief campaign surrogate. Her campaign has a slight edge over the Republicans in the state – which they won from the Republicans by 0.2% in the 2020 election. Georgia will feature again in her seven-stop battleground state tour commencing next week. During the rally, Harris challenged Trump to debate her on 10 September after reports that his commitment to the ABC-hosted event appeared to be wavering.
VP announcement in Pennsylvania
Harris is expected to announce her Vice-Presidential pick on Tuesday in Pennsylvania – a signal to some that she will choose the Governor of that state, Josh Shapiro as her running mate. While not yet confirmed, the prospect is reportedly creating a division within the Democratic Party because of the position that Shapiro – who is Jewish – has taken on the Israel-Gaza war and student protests on the issue. Some are warning Harris that selecting Shapiro will cost her the Arab vote.
Biden’s push to reform the Supreme Court
On Monday President Biden called for broad reforms to the Supreme Court. Kamala Harris has supported the proposals, hopeful that it will spur voters ahead of November’s election.
Trump causes controversy
On Monday Donald Trump repeated on Fox News earlier comments he made to a Christian convention, where he said that voters would never need to vote again if he returned to the presidency in November. Democrats described the remarks as “terrifying”, and evidence of Trump’s authoritarian and anti-democratic approach. Trump later denied the statement was an indication of intent to stay on beyond what would be his second four-year term.
In remarks to the National Association of Black Journalists on Wednesday, the former president suggested his opponent had changed her racial identity from Indian to Black. The comments caused an immediate backlash and bipartisan criticism from Democrats and Republicans, and the impact on voter sentiment will be borne out in polls over the coming weeks.
Candidates Zoom In on Economy
The economy is a pressing issue in the 2024 presidential election, with the policies of the respective candidates set to play a significant role in shaping the trajectory of the vote. Americans are looking for tangible measures that will help to improve their perceived economic conditions – not least a reduction in gas prices - and the nominees are focusing on different aspects of the economy in a bid to convince the public that they can, and will, deliver better outcomes. In this regard, energy policy will play a key role in the economic approach of both Harris and Trump, with the former advocating a pro-climate and green energy agenda in contrast to Trump’s plans to “drill baby drill” to return the US to energy independence, and dominance.
At the same time, the economy is facing challenges that will impact what the incoming President can do. First, higher for even longer interest rates will have implications for overall economic growth; second, a strong US dollar will negatively impact trade and exports; third, a very large fiscal deficit is creating a sustained upward trajectory for the public debt-GDP ratio; fourth, trade restrictions on some foreign partners are set to continue; and fifth, high inflation over the past years has resulted in poorer personal financial conditions for the average American.
Harris’ hand
Only one week into campaigning, the economy is featuring heavily in Kamala Harris’ public messaging: at a campaign event in Massachusetts on 27 July, she said, “building up the middle class will be a defining goal of my presidency. Because we know when America’s middle class is strong, America is strong.”
Harris is inheriting a mixed bag from President Biden. The US economy is in a strong position overall, with 14.8 million jobs added over the first three years of Biden’s term – more than any president in US history over the same period. Unemployment has stayed under 4% for the longest stretch since the 1960s, and households are in a better financial position now than ever before, with historic low household debt burdens, a surging stock market, rising wages, and inflation on its way down. The economy has experienced annualised growth of around 2.9% (excluding 2020) under Biden.
But this success is overshadowed by consumer sentiment – which remains below pre-pandemic levels – and perception. A Harris Poll survey conducted in May for The Guardian reports that 56% of Americans believe the economy is in a recession, and half of respondents that unemployment is at a 50-year high. Biden is widely blamed for deteriorating personal financial conditions as a result of inflation over the past few years – and even though inflation is edging closer to the 2% target, Harris is expected to prioritise distancing herself from Biden on this matter, while having to address public perception as a priority issue.
Kamalanomics
Harris is expected to continue the broader direction of Biden’s economic policy, aiming to extend “Bidenomics” and not radically change it. She will execute on planned projects and investments in critical infrastructure, manufacturing, advanced technology and clean energy – but she has also made clear her intention to focus on delivering the Democratic social programme that never quite got off the ground under Biden. This agenda includes increasing funding for childcare and education, implementing paid family leave and ensuring higher wages for those working in the “care sector”.
With the US Federal Reserve expected to lower borrowing costs prior to the election and inflation continuing to ease, Harris will likely emphasise the positives in the handling of the economy under the Biden-Harris White House, and raise the volume on the importance of the working class, including unions – not least to quash Trump’s attempts to portray himself as champion of the working people. Harris is critical of Trump policies that she says would, in fact, harm working families, such as tax cuts for the rich and corporations, tariffs on imports and the mass deportation of immigrants.
Trumpenomics
The Republican Platform lists several key objectives under its “America First” economic policy, including ending inflation – in part by “unleashing” American energy to bring prices down; tackling the cost-of-living crisis; improving fiscal sanity; and restoring price stability. It pledges to turn the US into a manufacturing superpower; prioritise domestic production and protect American workers, farmers and industries from unfair foreign competition; implement large tax cuts for workers (including no tax on tips) as well as a reduction in the corporate tax rate, fight for and protect social security and Medicare with no cuts; and cancel the electric vehicle mandate, which Trump sees as harmful to the US auto industry (a core constituency for his campaign).
Trump continues to emphasise protectionism. He wants to implement a 10% universal tariff on all imports and sets out to bring critical supply chains back to the US, strengthening “Buy American and Hire American” policies, including by banning companies that outsource jobs from doing business with the US Federal Government.
Furthermore, he has specific policy priorities regarding China. Under Trump, the US would revoke China’s Most Favoured Nation status, apply a 60% levy on Chinese-made goods and prevent Chinese entities from purchasing real estate and industries in the US.
Commentators have observed that there is scant detail on how the Republicans under Trump plan to deliver on these promises – not least because of the checks and balances within the system that could stymie some of the more radical proposals.
Analysts say the Republicans’ economic narrative is geared towards winning over working class, Latino, black and industry votes. Trump’s recent reversal on cryptocurrency is also motivated by a play to win votes – his campaign is now taking donations in Bitcoin, reportedly receiving $4 million thus far.
What the Polls Say
Trump leads
Aggregated polling data from RealClearPolitics show a 1.2 point advantage for Trump on average on 1 August, after a sudden drop from a 2-point lead just two days before on 30 July.
Harris leads
The Hill is reporting that Harris’ favourability among voters is on the rise. Based on 145 polls, it puts the Democratic candidate’s favourability at 46.4% as of 2 August – a notable hike since a month earlier when she scored 37.8%.
A Morning Consult poll conducted on 26–28 July gave the Democratic contender a one-point advantage over Trump.
A three-day Reuters/Ipsos poll that concluded on Sunday 28 July reports a similar result, with Harris scoring 43% to Trump’s 42%.
According to the latest New York Times poll, Harris trails behind Trump by two points in a two-person race at 47% to 49% – but with a margin of error of plus or minus 3.1 percentage points, this means that the race is essentially tied. Include Robert F Kennedy Jr and other independent and third-party candidates on the poll, and Harris leads Trump at 45% to 44%.
A Bloomberg/Morning Consult poll, published Tuesday, on the candidates’ performance in battleground states has Harris eradicating the former President’s lead across seven key states. She overtook Trump in Arizona and Nevada and more than doubled Biden’s lead in Michigan. But the gap between the candidates across the surveyed swing states remains within the poll’s statistical margin of error, showing just how tight this race will be.
Look Ahead
- Kamala Harris will hold her first rally alongside her vice-presidential pick on 6 August in Philadelphia, Pennsylvania, as part of a four-day battleground tour that includes Michigan and Arizona.
- The Democratic Convention will be held in Chicago on 19–22 August.