The Big Economic Shift: Candidate Senator Kamala Harris

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Senator (D, CA) Kamala Harris is the second African American woman in US history to be elected to the U.S. Senate and the first African American and first woman to serve as Attorney General of California.

She brings a unique perspective to the 2020 democratic primary as a woman of color and a former prosecutor.  She graduated from Howard University with a double major in political science and economics. In 1989, she earned her Juris Doctor (JD) from the University of California, Hastings College of the Law and passed the State Bar of California in 1990.  She’s been a deputy district attorney in Alameda County; a professor at Stanford and University of San Francisco; Assistant District Attorney of San Francisco; District Attorney of San Francisco; and Attorney General of California.

As senator, she sits on the following committees: Committee on the Budget; Committee on Homeland Security and Governmental Affairs; Subcommittee on Federal Spending Oversight and Emergency Management; Subcommittee on Regulatory Affairs and Federal Management; Select Committee on Intelligence; Committee on the Judiciary; Subcommittee on the Constitution; and the Subcommittee on Oversight, Agency Action, Federal Rights and Federal Court: Subcommittee on Privacy, Technology and the Law.

Harris has called herself a progressive prosecutor and her economic policy proposals reflect this approach.  She has participated in two of the Democratic debates for president and has qualified for the next round by meeting the requirements of garnering contributions from over 130,000 individuals, coming from 400 unique donors in 20 or more states and reaching 2% in at least four DNC-approved polls.

Key takeaways:

  1. Like Buttigieg, Harris’ economic policies stand in sharp contrast to the Republican corporate and individual tax cuts along with regulatory reform policies under the Trump administration.  
  2. Like Buttigieg, there will be a major restructuring of significant portions of the US economy like energy and healthcare if Harris is elected.  However, Harris has a significant change to housing and rent relief in her proposals.
  3. Like Buttigieg, expect a short-term, dramatic impact on the companies and relevant sector values until her policies are clearly delineated, communicated and enacted.  Unlike Buttigieg, Harris proposals reach deep into companies’ structure to regulate changes like equal pay.

The “Our America” page on her campaign’s website is organized with 13 major headings including:

Here’s a list of bills she supports or has co-sponsored:

  • Supported Countering America’s Adversaries Through Sanctions Act
  • Marijuana Justice Act
  • MORE Act of 2019
  • Secure Elections Act
  • Climate Risk Disclosure Act
  • Green New Deal (GND)
  • Climate Equity Act
  • Medicare For All plan
  • Choose Medicare Act
  • Stop Shackling and Detaining Pregnant Women Act
  • Dreamer Confidentiality Act
  • The Home Ownership Dreamers Act
  • The Equality Act
  • The LIFT (Livable Incomes for Families Today) the Middle Class Act
  • Rent Relief Act
  • The Family Act 

Economy and Job Creation

Under the Economic Justice page on her website Harris lays out her plans to correct a wide range of problems in the US economy.  Like Pete Buttigieg, she wants to utilize a combination of regulatory changes and fiscal spending to drive growth and jobs. Unlike Buttigieg, she proposes using executive orders to implement some of her plans.  There are 5 sub-plans to achieve this:

We’ll save the Medicare for All and Set Fair Prescription Drug Prices plans for the Healthcare section.  What follows is a review of her major economic and jobs programs.

To address the “Opportunity Gap”, Harris wants to invest in HBCUs (Historically Black Colleges and Universities) and MSIs (Minority Serving Institutes) by providing $60 billion in STEM education. $10 billion of this funding would go towards an infrastructure grant program and $50 billion towards a fund at the Department of Education to help build up STEM education.  She plans to provide $2.5 billion to support HBCU programs that will increase the number of Black teachers.  

For Black entrepreneurs, Harris wants to create a $12 billion capital grant and technical support program.  For Pell Grant recipients who start a business that operates for three years in disadvantaged communities, she’ll establish a program that will forgive up to $20,000 of their student loan debts.  Harris wants to reform the Opportunity Zones program to ensure funds go to minority-owned small businesses. She would also prioritize the lowest-income neighborhoods, prioritize hiring in those neighborhoods, and have safeguards to ensure that housing projects that are built as part of an Opportunity Zone actually contain affordable units. Additionally, she will ensure that information on this program is collected and made public to ensure that the program is held accountable for meeting its goal of improving opportunities for people and communities most in need. 

Under the LIFT the Middle-Class Act, a $3,000 refundable tax credit would be provided to individuals earning less than $50,000, and a $6,000 credit to couples earning less than $100,000.  The tax cut can be assessed each month or at the end of the year with families potentially receiving up to $500 a month and individuals up to $250 a month.  She is also proposing an expansion of the EITC (Earned Income Tax Credit), a major anti-poverty program that benefits both children and adults with wide bipartisan support.

On her “Combatting the Racial Homeownership Gap” plan, Harris wants to create a $100-billion U.S. Housing and Urban Development (HUD)-administered grant to provide up to $25,000 in down-payment assistance and closing costs.  She wants to amend the Fair Credit Reporting Act to require the credit scores reported by credit reporting agencies to include payments of rent, phone bills and utilities.  Finally, her plan will require lenders to calculate debt to income on a monthly basis and expand the sources of income for purposes of the calculation. Under the Rent Relief Act, this would give a tax credit to people who spend more than 30% of their income on rent, capped at the fair-market rent for the area and scaled by the renter’s income. 

Under the “Close the Pay Gap” plan, her goal is to reduce pay inequality in America by creating a new regulation requiring companies to obtain an “Equal Pay Certification.” To receive certification from the EEOC (Equal Employment Opportunity Commission), companies must demonstrate they have eliminated pay disparities between women and men who are doing work of equal value. To the extent pay disparities do exist for similar jobs, companies will be required to show the gap is based on merit, performance, or seniority–not gender.  

In applying for certification, companies will also be required to disclose their pay policies and align them with best-practice standards.  Companies will be required to report statistics on the percentage of women in leadership positions and the percentage of women who are amongst the company’s top earners. They will also be required to report the overall pay and total compensation gap that exists between men and women, regardless of job titles, experience, and performance.  

If companies fail to equalize pay, they will be fined 1% of their profits for every 1% wage gap they allow to persist for work of equal value.  Harris states she will not wait for Congress to act and will take executive action by requiring federal contractors to obtain an Equal Pay Certification within two years of her election.  If not, businesses will be barred from competing for federal contracts valued at more than $500,000, in essence shutting them out from most federal contracts.

On taxes, Harris wants to reverse the entire 2017 Tax Cuts and Job Act to use for her spending plans.  As well, she has proposed a new tax on banks with over $50 billion in assets and a financial transaction tax on stock trades at a rate of 0.2%, bond trades at 0.1% and derivative transactions at 0.002%.  Rounding this out, she has a 1% wealth tax; a 77% estate tax; 70% top tax rate for ordinary income and capital gains; a 4% payroll tax increase on households earning about $100,000 per year; and a 7.5% payroll tax increase on employers.  Lastly, she wants to raise the national minimum wage to $15 per hour. 


On the US-China trade relationship, Harris believes the tariffs are hurting consumers and farmers, while benefiting governments and corporations.  In August of 2018, she sent, together with Sen. Diane Feinstein, a letter to U.S. Trade Representative Robert Lighthizer, accusing China of engaging in “unfair industrial policies and outright theft of American intellectual property.”  She would propose large changes to the USMCA to address environmental and labor issues. On the issue of the TPP (Trans-Pacific Partnership), she believes there are not sufficient worker protections and that it the agreement was not transparent.   

Energy and the Environment

Sen. Harris is in favor of the Green New Deal.  Please see the research on this topic from our previous post on Pete Buttigieg.  In July, Harris, along with Rep. Alexandria Ocasio-Cortez, released the Climate Equity Act.  The legislation would require the nonpartisan Congressional Budget Office (CBO) to evaluate how new environmental bills would impact low-income communities. It would also require an Office of Climate and Environmental Justice Accountability to be created.

She wants to immediately re-enter the Paris Agreement and make climate cooperation a key diplomatic priority.   Harris has stated she is skeptical of fracking but has not joined other Democratic candidates in calling for a ban.  She would restore the Clean Power Plan and fully implement the Clean Car Standards.    


Under health-care, Harris proposes policies in three parts:  Medicare for All, Lower Prescription Drug Prices and Protect Women’s Health.  

Harris has said that her preferred version of “Medicare for All” would reduce but not eliminate private insurance companies. She generally supports Bernie Sanders’ plan. However, she would increase the threshold for families before they are taxed to $100,000 versus the Sanders’ plan that taxes above $29,000.  She would include a 10-year transition between plans as well as a private option alongside Medicare for All.  She has previously introduced legislation to expand mental healthcare availability and to reduce racial disparities in maternal mortality. 

On prescription drugs, she supports government negotiations, international reference pricing, and allowing the government to break the patents of brand drug companies so that generic drugs can be provided faster and more cheaply to patients.  If elected, she’ll require pharmaceutical companies to set fair prices for prescription drugs and tax profits made from abusive drug prices at a rate of 100 percent. If Congress doesn’t act within 100 days, the Harris Administration will investigate price-gouging by pharma companies unilaterally and take executive action to lower the cost of their drugs. 

On women’s health, Harris wants to block abortion restrictions before they take effect. States and localities with a history of unconstitutionally restricting access to abortion will be required to pre-clear any new law or practice with the Department of Justice.  Under the plan, states and localities will be subject to the preclearance requirement if they have a pattern of violating Roe v. Wade in the preceding 25 years.


Senator Kamala Harris presents an impressive picture as a progressive prosecutor to address America’s complex and challenging issues.   Her background frames her policy approaches from addressing homeownership to dealing with the high cost of prescription drugs with fines; going after rule breakers; and creating new regulations, rules and laws.  Her policies are aimed at assisting disadvantaged communities, increasing access to and reducing the cost of healthcare and protecting the environment. While addressing social problems, her policies are difficult to assess the positive impact on the economy and job creation beyond the negative impact of raising taxes and imposing fees.  (See 1st paragraph under Summary Pete Buttigieg.)

On the positive side, Harris addresses the lack of capital availability to Black entrepreneurs via her programs under the Opportunity Gap section.  While $12 billion in a $20 trillion + economy is tiny, the concepts under the program are good and will aid businesses in need of funding, and the success of these businesses can further support vulnerable Black communities.  The incentives for creating a business will also help those with Pell Grants and student debt, though this is a small category of people. As well, the EITC expansion and her investment in STEM research will ease poverty and increase minority participation in the sciences. 

On trade, Harris wants to reduce tensions with China and end the tariffs.  This could have the most significant, positive impact of all her proposals and lead to faster economic and job growth.  

On the negative side, Harris (and all those supporting Medicare for All) would significantly change a large section of the US economy.  The Green New Deal would create similar change and lead to high levels of uncertainty for businesses during the transition period.  

Like Trump, Harris would utilize executive orders to enact policy proposals that would only stand the test of time until the next election.  This is a major issue as this kind of parliamentary ruling style is disruptive and can cause businesses to withhold on making capital expenditure decisions due to lack of certainty.  As an example, why would a large pharmaceutical company engage in new drug research if it will be subject to a decision by the HHS panel on what prices it can charge? Under the Climate Equity Plan (CEP), why would a company consider fracking or putting any plant near a low-income population if it could be subject to fines by the Office of Climate and Environmental Justice Accountability?  

Yes, this would improve the environment for the community and could lead to higher participation in the local economy but at the trade-off from job losses in the same community. While many of the fracking related jobs are transient, there is still a positive economic impact from the activity for service jobs, road construction and taxes for the community.  But these, in turn, are transient and leave when the workers leave and then the community must deal with any environmental issues that remain. More broadly, fracking and horizontal drilling have dramatically increased the supply of oil and natural gas for the United States and helped reduce prices for energy like gasoline and heating a home. In turn, this disproportionately assists low to middle income groups who spend more of their incomes on transportation and home energy.  

GND and CEP may produce a trend towards other kinds of energy production filling this void, as they would not be subject to the same regulatory issues under the plan. In saying that, some of these restrictive policies could potentially run counter to the changes to the Opportunity Zone programs Harris wants to enact for improving the opportunity for people and communities most in need. It becomes a complex issue of exactly what low-income or disadvantaged communities need: jobs, a clean environment, and good housing are all important, but which need gets traded off against the others?  Trade-offs from trade-offs from trade-offs.  

Finally, the Rent Relief Act may simply incentivize landlords to raise rents immediately to take advantage of the federal subsidy.  It’s also possible that renters would then desire higher-priced apartments they couldn’t afford before the subsidy. Then, there’s the question of prices between New York City and Cleveland.  While most low-income NYC renters would qualify for the subsidy, Cleveland renters would not. To drive down the cost of renting, it would be better policy to encourage an increase in the supply of new rental properties versus subsidizing the price of rent. 

Just as we concluded under Buttigieg, these policies of addressing unequal pay, providing increased access to healthcare, correcting housing inequality and dealing with important environmental issues are critical for the long-run health of an economy and society.  With any intervention into business and the economy, it is a question of trade-offs: inefficiencies, higher taxes and higher costs via regulations versus better economic outcomes, better healthcare and better housing for underserved communities.

And like Buttigieg’s plans, the changes Harris proposes are a significant shift from where the current business environment stands after two years of the Trump administration. 

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I'm Andy Busch

If things feel crazy in the world today, that's because they are. We are seeing huge shifts in risk and reward, leading to a lot of economic uncertainty and confusion about where we go from here.

As an economic futurist, I do things a bit differently than your typical economist — going beyond analyzing how today's financial policies impact economic growth, to focus on the super-charged trends driving much of today's global chaos and change.

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