6 Ways a Harris Presidency Could Impact the Finances of Lower-Income Americans
With the presidential election looming, the middle class — which spans such a wide range of income levels, approximately $50,000 to $150,000 per year — often dominates the conversation. However, lower-income Americans may be wondering what either presidential candidate has to offer them as they lay out their economic plans.
Vice President Kamala Harris, officially the Democratic nominee for president, has been a vocal advocate for economic equity, according to Michael Collins, CFA, founder and CEO of WinCap Financial.
How would a Harris presidency affect the finances of lower-income Americans?
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“Harris has proposed policies and initiatives aimed at addressing income inequality and providing assistance to low-income individuals and families,” Collins said, which could signal how she would proceed in the future. “This includes proposals such as increasing the federal minimum wage, expanding affordable housing options, and investing in education and job training programs.”
With these and other moves, Collins suggested, “a Harris administration could potentially provide greater support and resources for lower-income Americans to improve their financial stability and overall well-being.”
Here are six ways a Harris presidency could be a boon for lower-income Americans.
A Wealth Tax Trickle-Down
Harris has outlined an economic plan she’s called the “opportunity economy” that builds upon the Biden administration’s existing plan and strengthens it in some key areas. She’s said she would raise the corporate tax rate back up to 28% (from its current 21%, a Trump administration reduction), and that people making under $400,000 per year would not see an increase in new taxes.
Jonathan Feniak, general counsel and a financial expert with LLC Attorney, said Harris’ promises amount to a “wealth tax” that “can potentially reallocate resources and enhance economic equality.”
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Housing and Rent Relief
A Harris presidency could significantly and positively impact the financial well-being of lower-income Americans and their ability to find affordable housing. Harris advocated for policies that directly addressed the needs of this demographic when she was a senator through such bills as the 2019 Rent Relief Act, which provided a refundable tax credit to help low-income families cover the cost of rent.
Harris also has ambitious plans on the campaign trail. She unveiled an agenda called “Build the American Dream: Lowering the Costs of Renting and Owning a Home,” which would push for the construction of 3 million new housing units in the next four years, crack down on “price-fixing” among landlords who charge more than market rates and expand the Low-Income Housing Tax Credit.
Increasing the Federal Minimum Wage
Furthermore, Harris has advocated for increasing the federal minimum wage, which would provide a much-needed boost in income for millions of lower-income workers. Though she hasn’t specified how much of a raise she would push for if she were to be elected president, Harris has suggested a $15 per hour minimum in the past.
According to a study by the Congressional Budget Office, a $15 minimum wage could lift a significant number of Americans out of poverty.
Closing the Racial Wealth Gap
The Biden-Harris administration has also emphasized the importance of closing the racial wealth gap, which disproportionately affects lower-income Americans. Back in 2021, they proposed a multipronged approach to build up Black wealth and narrow the racial wealth gap. It seems likely that Harris would continue with such efforts.
Past proposed initiatives of Harris’ also include the Livable Incomes for Families Today Act, which would have provided a tax credit of up to $6,000 annually for low-income and middle-class families, had it been approved. While it was not, Harris’ new proposals, should she be elected, include an expansion of the child tax credit, an expansion of the Affordable Care Act’s subsidies, and $25,000 in down payment assistance for first time homebuyers, to name a few.
While some critics argue that such policies could have unintended consequences, like job loss or inflation, the potential benefits for lower-income Americans are substantial.
Increased Federal Spending on Social Programs
Based on Harris’ past stances, a Harris presidency might also help lower-income Americans directly by focusing on increasing federal spending for social programs, said Jonathan Gerber, president of RVW Wealth.
This could potentially provide direct support to lower-income households and improve their financial stability.
A Targeted Expansion of Support
Feniak said it’d be probable to see Harris work to expand medical benefits and housing support for low-income families, strengthening people’s overall financial cushions.
“However, it’s important to remember these changes won’t occur in a vacuum, and their actual impact will depend on factors like legislative support, and the state of the economy during her term,” he said.
Harris needs to not only win the White House in November but likely majorities in both the House and the Senate if she hopes to make such plans a reality.
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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