Sean Bryant
Jun 28, 2024
“Based on what I’ve observed in the economy, I would say that Biden’s policies would truly have little impact, because shifting who foots the bill inevitably falls on the consumer,” said DeLuca. “What the Fed does regarding the Federal Fund Rate has just as much impact on the price of goods and borrowing power.”
With the elections approaching on November 5, Americans face a challenging decision between reelecting former President Donald Trump or continuing with President Joe Biden. The state of the economy is a significant concern, with high house prices, mortgage rates, and inflation impacting essential costs like rent, gas, and groceries. An Ipsos Polling study highlights that inflation and the economy are crucial issues for voters.
Key Issues and Policies:
Healthcare: Over 80% of Americans are concerned about healthcare costs. Trump has not proposed alternative plans, while Biden has improved the Affordable Care Act, expanded the PACT Act for veterans, and signed the Inflation Reduction Act to reduce insulin costs. If reelected, Biden aims to further lower healthcare costs, including prescription medications.
Taxes: Trump's 2017 Tax Cuts and Jobs Act, which lowered taxes for the middle class, is set to expire in 2025. Biden plans to raise taxes on businesses and high earners while aiming to reduce middle-class taxes, potentially increasing the Child Tax Credit. Anthony DeLuca notes, "Biden, if reelected, will most likely let the TCJA sunset. Consequently, he will raise the personal income tax rate to 39.6% for individuals earning above $400K and increase corporate tax from 21% back to 28%. If you increase tax to the wealthy, who are generally the business owners, then price increases will fall back down to the consumer."
Student Loan Debt: Biden proposed forgiving student loan debt, including reducing monthly payments and forgiving up to $20,000 for Pell Grant recipients. However, the plan lacks full support and may not see changes soon. Biden may still work to make higher education more affordable, easing the burden on middle-income households.
Inflation: Currently at 3.4%, inflation is closer to the Fed's target than the 7% peak in 2021. Biden has not outlined specific plans to reduce inflation but focuses on lowering taxes, reducing student loan debt, and increasing healthcare benefits. DeLuca comments, "Based on what I’ve observed in the economy, I would say that Biden’s policies would truly have little impact, because shifting who foots the bill inevitably falls on the consumer. What the Fed does regarding the Federal Fund Rate has just as much impact on the price of goods and borrowing power."
Biden's potential reelection could see continued efforts in healthcare and tax reforms, but with possible implications for inflation and overall economic impact.