U.S. Vice-President Kamala Harris on Friday unveiled a series of measures she will pursue as president to provide tax breaks and lower costs for American consumers, seeking to show her command of the economic issues that have dominated the presidential campaign.
Among her proposals are a federal ban on price gouging in the grocery sector, US$25,000 cash payments to help certain first-time homebuyers with a down payment, the expansion of the child tax credit and policies reducing the cost of prescription drugs.
“We can do this,” Harris said at the event in Raleigh, North Carolina, a state that has become a battleground in the election.
The speech, Harris’ first solely focused on policy since securing the Democratic nomination in whirlwind fashion this month, reflected a recognition that the economy remains top of mind for voters heading into November’s election after years of high inflation.
The Harris campaign is also seeking to strike a sharp contrast with her Republican opponent, former president Donald Trump, who has struggled to stay on message and detail how exactly he would lower prices and fix an economy he calls a “disaster” under the Biden administration. He has accused both Harris and U.S. President Joe Biden of fueling inflation through government spending.
Year-over-year inflation in the U.S. has reached its lowest level in more than three years, falling below three per cent, the U.S. Labor Department said Wednesday. But food prices and other consumer goods are 21 per cent above where they were three years ago.
Consumer confidence surveys show that high prices remain a persistent source of frustration for shoppers, particularly among lower-income Americans, even as inflation has cooled.
There have been similar concerns in Canada, where consumers say they’re struggling with the cost of living despite data showing the Canadian economy is technically staying afloat — a disconnect economists have dubbed a “me-cession.”
Major grocers in Canada have also been accused of price gouging or “greedflation,” and the federal government says it is working to improve competition in the sector as a way to drive down food prices.
What Harris proposed
Harris said the price-gouging ban would target “bad actors” she said exploit crises like the pandemic and resulting breakdown in supply chains by setting artificially high food prices while raking in increased profits.
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She added she will help the food industry become more competitive to further drive down costs. The Harris campaign said Thursday in previewing the speech that a Harris administration would put more scrutiny on merger activity in the American sector.
Harris is also calling for tax breaks aimed at families, as well as middle- and lower-income people. That includes expanding the child tax credit to up to US$3,600, and US$6,000 for children in their first year of life.
Harris said she would also expand the earned income tax credit to cover people in lower-income jobs without children, which the campaign estimates would cut their effective tax rate by US$1,500. Harris also wants to lower health insurance premiums through the Affordable Care Act.
Acknowledging the rising price of home ownership and rentals, Harris said she would seek to cut regulatory red tape to spur the building of three million new affordable homes and rentals by the end of her first term. She added she will fight for laws that crack down on landlords who collude to set artificially high rents.
The US$25,000 down payment help for first-time homebuyers contrasts with financial incentives pursued by the Canadian government, which has also been under pressure to address a housing shortage and out-of-reach prices for a home. A loan program for up to 10 per cent of a purchase price ended in March, though the government still allows tax-free RRSP withdrawals of up to $35,000 toward a first-time down payment.
Overall, Harris’ plan represents a continuation of the Biden administration’s economic priorities, but with a notable shift in emphasis from job creation and infrastructure to the cost of living for families. The plans for lowering prescription drug costs would build on policies Biden signed into law in 2022.
One Harris advisor described her messaging shift to Reuters on Thursday as “same values, different vision.”
Many initiatives would require congressional approval, which is far from assured in the current political environment, and there were scant details on how to pay for the ideas.
Some of Trump’s economic advisers offered rebuttals. Kevin Hassett, a former chairman of the Council of Economic Advisors during the Trump administration, called it “completely preposterous” for the government to play a role in setting food prices, a reference to Harris’ proposed federal price gouging ban.
Contrast with Trump
Trump has claimed Biden and Harris’s economic agenda is responsible for inflation, and said Thursday at a press conference surrounded by grocery items that Harris would drive prices up even more. He argues increased energy production and sweeping tariffs on international imports would lower consumer costs.
But Harris said on Friday that Trump’s tariffs — which he wants to set at 10 to 20 per cent on most countries but at 60 per cent on goods from China — would raise prices on those imports for Americans, which economists have warned would hurt lower-income families by adding well over US$1,000 a year in extra costs.
“He wants to impose what is in effect a national sales tax on everyday products and basic necessities that we import from other countries,” Harris said.
“That will devastate Americans.”
Canadian economists have warned Trump’s proposed tariffs would damage Canada’s economy, pushing up inflation and interest rates while dropping GDP due to Canada’s reliance on trade with the U.S.
Harris is fighting an uphill battle with voters on economic issues, which is typically a Republican selling point, and regain ground lost by Biden on the issue during his presidency.
The latest Associated Press-NORC Center for Public Affairs Research poll suggests 45 per cent of voters think Trump is better positioned to handle the economy, while 38 per cent say that about Harris.
The Ipsos Consumer Tracker as of Tuesday found while Trump leads Harris slightly on a number of economic issues, including the ability to pay household bills, more people think their family’s future wellbeing will be better under a Harris presidency.
Ipsos noted Harris is doing “much better” on economic issues overall than Biden did when Americans were last surveyed in March.
Harris, who is set to formally accept the Democratic nomination at her party’s convention in Chicago next week, promised more economic policies will be released in the coming days.
Canadians are eager to see how Harris will envision her economic record as president, and whether impacts on consumer goods will have ripple effects in Canada.
Whoever wins the U.S. presidency will also oversee the first review of the Canada-United States-Mexico Agreement on trilateral trade that replaced NAFTA during the Trump administration. The review, which is mandated to take place every six years, will begin in 2026.
— with files from The Associated Press and Reuters
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