Economic Showdown: Harris vs. Trump in Tuesday’s Debate - What’s at Stake?

Diccon Hyatt brings extensive experience as a financial and economics journalist, having reported on the pandemic-era economy through hundreds of clear, insightful stories. His work focuses on how economic trends impact personal finances and the broader market. He has contributed to U.S. 1, Community News Service, and the Middletown Transcript.

Key Points to Know

• In their first televised debate, former President Donald Trump and Vice President Kamala Harris will present contrasting economic plans to voters.
• Trump advocates for sweeping tariffs on imported goods, which economists warn could increase inflation, while Harris supports targeted tariffs to bolster specific U.S. industries.
• Trump aims to maintain the 2017 tax cuts, whereas Harris proposes raising taxes on the wealthy and high earners to fund social programs.

For months, Kamala Harris and Donald Trump have criticized each other’s economic strategies, and the upcoming debate offers a direct platform to challenge one another on these policies.

The discussion will likely focus on inflation, taxation, and student loan debt—key issues that have dominated recent campaign rhetoric.

The live debate is scheduled for Tuesday, September 10, at 9 p.m. Eastern Time.

Inflation and Tariffs

Since the pandemic began, the cost of living has surged, with prices averaging 21% higher than pre-pandemic levels according to the Consumer Price Index. Inflation peaked in 2021 and 2022 but has since moderated.

Trump blames the inflation spike on policies from President Biden and Vice President Harris, while economists largely attribute it to pandemic-related supply chain disruptions and stimulus measures that increased consumer spending.

Harris counters Trump’s approach by citing economic analyses from Goldman Sachs and Moody’s Analytics, which suggest that Trump’s tariff-heavy plans could worsen inflation and hinder growth.

Trump’s proposal includes broad tariffs of 10% to 20% on all imports and tariffs exceeding 60% on Chinese goods. He argues these would revive American manufacturing and boost the economy, referencing historical precedents like President William McKinley.

However, most economists warn that tariffs typically raise consumer prices and give domestic producers leeway to increase costs. The Peterson Institute estimates that families could face an additional $2,600 in annual expenses under Trump’s tariff policies.

Harris favors more selective tariffs, aligning with Biden’s strategy to support key sectors such as microchip manufacturing and electric vehicles.

Tax Policies

Taxation remains a major point of contention. The future of the 2017 Tax Cuts and Jobs Act, set to expire soon, is uncertain.

Trump pledges to extend all aspects of the tax cuts, which simplified the tax code but disproportionately benefited wealthy individuals.

Harris proposes targeted tax credits and increases, including a $25,000 credit for first-time homebuyers and an expanded child tax credit up to $3,600 per child. She also plans to raise the corporate tax rate from 21% to 28%, partially reversing Trump’s cuts.

Additionally, Harris aims to increase the capital gains tax to 28%, a more moderate rise compared to Biden’s earlier nearly 40% proposal.

Student Loan Forgiveness

Harris supports Biden’s student loan forgiveness program, which has eliminated $168.5 billion in federal student debt, despite legal challenges delaying further relief.

Trump criticizes these policies as unlawful, frequently voicing opposition during campaign events.

Correction, Sept. 11, 2024: The article has been updated to clarify that Harris will not raise taxes on individuals earning less than $400,000 annually.

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