Detailed Analysis of Harris's First Economic Policy Agenda: A Blessing for American Families or a Fiscal Nightmare?

In the financial world, every shift in policy direction can create market ripples. Today, let's delve into Harris's proposed economic policy agenda, marking her first comprehensive articulation of her economic vision as the Democratic presidential candidate. From a professional investor's perspective, her plan is not merely a political declaration but a far-reaching economic blueprint.

On August 16th, U.S.Vice Presidentand Democratic presidential candidate Harris delivered her first economic policy agenda speech at a rally in North Carolina.The speech centered on "reducing the living costs of American families," aiming to build an economy where "everyone can compete and truly have the opportunity to succeed, to create wealth for themselves and their children, rather than just making ends meet."

The core of this agenda is to lower the living costs of American families, with a particular focus on food, taxes, housing, and healthcare. Specific measures include:

Previously, high inflation eroded the real wages of residents across U.S. states, exacerbating the widening wealth gap. These factors collectively led to poor microeconomic perceptions among the public. Despite robust macroeconomic data, the administration failed to garner voter support, creating a significant gap between macroeconomic performance and public approval. This disparity ultimately became one of the key reasons for Biden's decision not to seek re-election.

In addressing this issue, Harris's policy agenda continues Biden's focus on the middle class but adopts a more proactive stance on housing and healthcare costs, even proposing legislative measures to lower living costs for American families. This aims to alleviate voter dissatisfaction with the Biden administration's handling of inflation and to garner their support and goodwill.

Harris's economic policies notably introduce administrative and legislative measures to combat price gouging and market manipulation by companies. Compared to Trump's approach of "rapid rate cuts + significant tariff hikes," which can transfer costs to domestic residents and raise living expenses, Harris's legislative measures can effectively reduce living costs without triggering re-inflation risks, showcasing a more stable economic management philosophy.

Harris's stance on tax cuts aligns with Trump’s, aiming to reduce the tax burden on workers and the middle class. This strategy directly echoes Trump's 2017 Tax Cuts and Jobs Act, demonstrating Harris's deep strategy in appealing to blue-collar voters. At a campaign rally in Nevada, Harris even promised to eliminate the tip tax for service and hotel workers, a proposal similar to Trump's suggestion in June, indicating her alignment with Trump on tax reduction strategies to diminish his economic appeal.

Harris places particular emphasis on food prices and housing costs, which can effectively improve voters' perceptions of the current economic situation. According to a January 2024 Pew Research Center survey, most respondents attributing economic issues to inflation (28%) or high living costs (21%) specifically cited high food or housing costs (12%).

Harris's focus on controlling food prices and her plan to build 3 million new homes to reduce housing costs are measures that could alleviate public dissatisfaction with the microeconomic environment, thereby winning voter support.

In this politically and economically intertwined election, Harris has centered her campaign strategy on the issue most concerning to the public: living costs. Not only does she mirror Trump’s approach on tax cuts, but she also adopts more proactive legislative measures to effectively lower living costs without risking inflation, thereby increasing her chances of victory.

However, Harris's proposed combination of "price reduction + tax cuts + high social security" policies, while potentially improving living standards and economic sentiments in the short term, signals a trend of rising fiscal deficits and increasing debt burden from a long-term fiscal health perspective.

According to the Committee for a Responsible Federal Budget (CRFB), if Harris's policies are implemented, the deficit could increase by up to $1.7 trillion over the next decade (FY 2026 to FY 2035). If temporary housing policies are made permanent, this figure could surge to $2 trillion. Furthermore, the current deficit calculations do not include other proposals by Harris, such as eliminating the tip tax and raising the minimum wage, which are expected to add an additional $100-200 billion to the deficit over ten years. Additionally, spending in other policy areas such as manufacturing (new energy, semiconductors) and immigration has not been accounted for, further indicating a potential rise in the deficit rate if Harris wins.

Harris's strategy reflects her deep concern for public living costs while also exposing the severe challenges of deficit and debt issues. In the balance of economic policy, Harris attempts to weigh the immediate needs of the public against the long-term interests of the nation. However, this balance is not easily achieved. Every tax cut and every enhancement of social security could leave a significant mark on the future fiscal ledger.

Faced with such dual impacts, we can't help but ask: Is Harris's economic policy a bridge to prosperity or a slide into a debt abyss? Between votes and deficits, can Harris find a path to sustainable development? The answers to these questions will not only determine Harris's political fate but also influence the future trajectory of the U.S. and global economies.