WASHINGTON (AP) — All of a sudden, the focus is on Kamala Harris’ economy – a great opportunity but also a potential risk for the likely Democratic presidential nominee.
Shortly after President Joe Biden dropped out of the race a week ago, Harris began developing her own narrative around the economy, focusing on ending child poverty, boosting unions, reducing health care and child care costs and protecting “dignity” in retirement.
In her speeches in Wisconsin, Indiana or Texas, she did not once mention the word “inflation” – the overwhelming economic challenge that haunts Biden’s administration and forces him to repeatedly point out in his speeches the plight of voters struggling with higher costs for food, gasoline, housing and cars.
Harris places greater emphasis on what she believes could be ahead.
“In our vision of the future, we see a place where every person has the opportunity not just to get by but to get ahead – a future where no child has to grow up in poverty, where every retiree can retire with dignity and where every worker has the freedom to join a union,” Harris told the American Federation of Teachers on Thursday.
But Republicans are now trying to blame Harris for the inflation they had until recently attributed to Biden, emphasizing the cumulative impact of high prices under the Democratic administration.
Labor Department data shows that consumer prices have risen 19.2 percent since Biden took office, while average hourly wages have increased 16.9 percent.
Republican Party leaders openly say Harris contributed to inflation, but do not explain how she did so other than through her vice presidency.
“Vice President Harris is responsible for the record of this administration,” said Republican Senate Minority Leader Mitch McConnell of Kentucky. “Her fingerprints are all over the last four years of failure.”
Former and current officials who have worked with Harris said in interviews that criticism of inflation is not expected to stick with her because she represents a fresh voice for many voters after nearly eight years with either Republican Donald Trump or Biden in the Oval Office.
Now it is time for Harris to set out her own policy positions on economic issues.
Some of those officials, speaking on condition of anonymity because they are not authorized to discuss policy matters publicly, said Harris would likely stick with Biden’s 2025 budget proposal and its plan to raise the corporate tax rate to 28% from the 21% set in Trump’s 2017 tax overhaul.
Her rise to the Democratic nomination coincided with positive economic news.
The Commerce Department said on Thursday that the economy grew by 2.8 percent annually in the second quarter. On Friday, it reported that the inflation rate, which is calculated from private consumption expenditures, had fallen to 2.5 percent. Financial markets are now expecting the US Federal Reserve to cut interest rates in September.
Those who have known Harris for years say that her work as a prosecutor in California has led to a sense of justice being at the heart of her economic policy ideas.
“She’s a capitalist at heart – she wants companies to do well,” says Yasmin Nelson, a former senior adviser to Harris. “But she recognizes that the tide has turned in her favor during the Trump administration. From her perspective, she wants to level the playing field.”
Trump and his running mate, Senator JD Vance (R-Ohio), are keen to portray Harris as more liberal than Biden, suggesting that the former California senator would further restrict the exploit of fossil fuels in favor of solar, wind and other renewable energy sources.
At a rally in North Carolina on Wednesday, Trump called Harris “the most incompetent and left-wing vice president in American history.”
Vance discussed her politics in an interview Friday on Megyn Kelly’s SiriusXM program.
“We cannot allow people who are going to destroy America’s manufacturing and energy economy to take power,” Vance said. “It will be much worse if someone even more liberal than Biden comes to power.”
The Trump campaign team was quick to revisit Harris’ comments from her short-lived run for the Democratic presidential nomination in 2020. At the time, she told CNN that she supported a ban on plastic straws, offshore oil drilling and the exploit of fracking to extract oil and natural gas – a controversial stance in the swing state of Pennsylvania.
Republican lawmakers also say Harris will raise taxes, which Biden’s 2025 budget only calls for on wealthier households and businesses.
The Harris team stated that she does not support a fracking ban. During the 2020 vice presidential debate, she emphasized several times that Biden would not end fracking.
The Energy Information Administration shows that both natural gas and oil production have risen to record levels during Biden’s presidency after a pandemic-related decline. However, the Biden administration’s policies are more restrictive than Republicans wanted.
The bigger risk for Harris may be how ongoing inflation shapes voters’ views of the economy. Many economic models used by financial firms to analyze the election are based on the incumbent’s party, and in this case, not the candidate herself.
Consulting firm Oxford Economics said in an analysis Monday that the odds are in Trump’s favor. The forecast is based on models that exploit economic data and does not necessarily take into account social issues such as abortion and gun control that Democrats say will support them win the election.
The analysis stresses that there is a high level of uncertainty and notes that a lot can happen in the coming months. However, it is quite clear that inflation is still a burden for the Vice President.
“I doubt Harris will significantly change swing voters’ views on the economy,” said Bernard Yaros, an economist at Oxford Economics. “She still carries the same burden of dealing with the high inflation of 2021 and 2022. Like Biden, her approval rating has taken a hit during this inflation spike.”
