The state of the U.S. economy will likely dictate the outcome of the 2024 presidential election. According to polling from the Pew Research Center, 77 percent of Americans rate the economy as “fair” or “poor,” suggesting that issues like stubborn inflation and high housing costs are affecting voters’ faith in Democrats’ economic policy.
Vice President Kamala Harris has outlined a vision for what she calls an “opportunity economy” that includes supporting middle-class and low-income-earning households with policies like providing $25,000 in down payment assistance to first-time homebuyers and expanding the child tax credit to $6,000 during the first year of a child’s life.
Conversely, Donald Trump’s economic vision mainly focuses on providing tax benefits to corporations and the wealthy while increasing the cost of everyday goods through tariffs.
The nonpartisan Committee for a Responsible Federal Budget estimated that Harris’s plan would increase the national deficit by $3.5 trillion, compared to the $7.5 trillion hit the economy could take under Donald Trump’s plan.
But understanding the difference between Harris’s so-called “opportunity economy” and the more traditional stakeholder economy, which places business needs ahead of everyday people, that Trump espouses takes more than crunching numbers.
At first glance, Harris’s “opportunity economy” seems to draw heavily from the branding used by the United Kingdom’s Labour Party in the mid-1990s to regain power in the country. Gordon Brown, a former U.K. prime minister and Labour Party leader from 2007 to 2010, used the term “opportunity economy” as a contrast to the traditional vision of a “stakeholder economy.” This branding helped the party maintain power from 1997 to 2010 and contributed to its most recent election victory last summer, which ended fourteen years of Conservative Party rule. The Washington Post reported that Labour Party strategists have been spotted advising the Harris campaign on winning back disaffected voters from the center-left.
During a campaign stop in Pittsburgh on September 25, Harris laid out the philosophy underpinning her “opportunity economy”—in which people will not “just get by, but be able to get ahead” and “ambition and aspiration” would be the baseline indicators of economic success, not generational wealth.
“Our economy has grown better and better for those at the very top, and increasingly difficult for those trying to attain, build, and hold on to a middle-class life,” Harris said. “In many ways, this is what this election is all about.”
Minnesota Governor Tim Walz added more depth to the idea during the vice presidential debate on October 1 by discussing how the plan could address challenges like high housing costs and stubborn inflation. Harris’s plan calls for expanding Low-Income Housing Tax Credits to incentivize building more than 1.2 million affordable homes, ending predatory landlord practices, and passing a federal ban on price gouging to lower the cost of food and household items.
“A house is much more than just an asset to be traded somewhere. It’s foundational to where you’re at,” Walz said during the debate. “And then making sure that the things you buy every day, whether they be prescription drugs or other things, that there’s fairness in that.”
Harris’s plan also contains shades of Bill Clinton’s “play by the rules” rhetoric from the 1990s, which sought to increase workforce participation rates for low-to-moderate-income households. To that end, Clinton called on the government to improve educational opportunities, child care services, and medical coverage to help people return to work. “The ideal that if you work hard and play by the rules, you’ll be rewarded . . . . But that idea has been devastated for millions of Americans,” Clinton said during a stump speech in Pennsylvania in 1992.
These ideas have come full circle following the COVID-19 pandemic. Inflation continues to be the chief scourge in the economy, and people are paying more for necessities like food and gasoline. Meanwhile, housing costs continue to rise across the country, and more households are turning to credit cards to pay their monthly expenses.
Kyle Moore, an economist with Economic Policy Institute Action, tells The Progressive that Harris’s policies are extensions of those put forth by the Biden Administration to help the economy recover from the pandemic. The expanded child tax credit played a vital role in that recovery effort by helping to cut child poverty in half, according to an analysis by the Brookings Institution.
“Harris’s plan is looking at what worked and what brought us out of the pandemic recession, and doubling down on those policies and expanding them so that more people can take advantage of them,” Moore says.
Harris’s opportunity economy plan also seems to differentiate between short-term economic boosts, like tax cuts, and long-term growth by supporting workers and their families, according to Casey Peeks, the senior director of early childhood policy at the Center for American Progress.
Peeks tells The Progressive that investing in the well-being of children is a vital part of long-term economic growth because those children will one day grow up to participate in the workforce. That’s why Harris’s plan focuses on addressing the rising cost of child care and improving access to child care services for low- to moderate-income families. For instance, the plan includes capping the price of child care at 7 percent of a household’s income and providing a $50,000 tax credit to help launch new small businesses, which includes child care providers, Peeks adds.
“It helps the parents of today, it helps the businesses of today,” Peeks explains, “but it also is going to help sustain this opportunity economy because the young children that exist now are set up on a path where they’ll have more opportunities once they reach adulthood if they have access to new quality early care and education supports.”
The Harris campaign still needs to overcome some roadblocks before her opportunity economy can be implemented. For one, she needs to win the 2024 election. Public polling suggests that the race between Harris and Trump is very tight, especially in battleground states like Pennsylvania, Michigan, Wisconsin, and Arizona.
Then there’s Congress and the battle for control of both chambers. Data analysis from 270 to Win, a nonpartisan election polling and projections website, suggests there are twenty-one toss-up contests in this year’s House of Representatives election. This could give Democrats an opening to regain control of the House.
However, the thirty-four open Senate races seem to favor Republicans, which could make it much more difficult for Harris’s policies to even come to a vote. Senators like Montana’s Jon Tester and Ohio’s Sherrod Brown face some of the most competitive races. Florida’s Senate race between Democrat Debbie Mucarsel-Powell and MAGA firebrand Rick Scott also seems likely to be a tight contest.
Peeks remains cautiously hopeful: “We have the proof point,” she says, referring to the impact of pandemic-era policies that Harris supports, like an expanded Child Tax Credit. “Now it’s just a matter of how we are going to sustain some of those great, progressive investments that we made during the pandemic to be long-term.”