In the upcoming 2024 presidential election, the American economy stands at a crossroads, with two distinct paths laid out before the voters. One path leads towards isolationism, deregulation, and tax cuts for the wealthy, funded by significant government deficits. The alternative road supports the middle class through thoughtful tax policies, sustains global engagement, and focuses on future investments in infrastructure and manufacturing. This latter choice builds upon the current trajectory that has driven rapid and widespread growth over the past 3 ½ years.
Despite the challenges posed by the global pandemic and the conflict in Ukraine, the U.S. economy has undergone an extraordinary recovery over the past three years, showcasing remarkable growth and resilience. Real GDP expanded by 3% in the most recent quarter, with unemployment resting at a near-record low of 3.4% as of January 2023. Notably, the U.S. has outpaced its G7 counterparts in terms of economic recovery since the onset of the pandemic.
A standout aspect of the U.S. economic growth is the absence of excessive inflation, distinguishing it from many other nations. This absence suggests that the major drivers of inflation in the U.S., as well as globally, stem from external shocks like the pandemic and the conflict in Ukraine, rather than solely from domestic fiscal policies. The prevailing narrative implicating the Biden administration’s fiscal policy as the primary source of inflation has been debunked by the actual data.
The U.S. recovery outshines that of other G7 countries and sets a new historical precedent for American economic resilience. In stark contrast to the post-Global Financial Crisis “Lost Decade,” which inflicted significant income losses on average households, the U.S. recovery from COVID-19 has been swift and thorough. Employment levels have surpassed those of 2020, achieving recovery in just three years.
While inflation remains a concern, recent figures show a stabilizing trend, with inflation levels inching closer to the Federal Reserve’s 2% target. Real income per capita has even registered notable growth, underscoring the robust nature of the economic recovery.
Despite certain distributional inequalities, the overall trajectory favors progress, particularly for those at the lower end of the income spectrum. Real wage growth for non-managerial workers has outpaced that of higher-paid professionals, contributing to a narrowing gap in income inequality.
Looking ahead to the future, economic forecasts remain optimistic, barring unexpected events. With interest rates on a downward spiral, borrowing is set to become more accessible, especially for prospective homebuyers.
However, the positive economic outlook hinges on the choices made in the upcoming election. The economic platforms of the presidential candidates diverge widely, with significant implications for the nation’s economic trajectory.
On one hand, the economic proposals put forth by the Republican nominee, Donald Trump, signal a return to tax cuts and a risky tariff policy that could endanger economic stability. Conversely, the Democratic candidate, Vice President Kamala Harris, offers a more balanced approach that emphasizes tax breaks for the middle class and strategic investments to boost economic growth and reduce inequality.
The costs associated with each candidate’s economic plan paint a clear picture. Trump’s proposals come at a heftier price tag, both in budgetary terms and potential economic consequences. His tariff policies, in particular, are deemed disastrous by most economists, with looming threats of recession and trade wars casting a shadow over economic stability.
On the contrary, Harris’ plan aligns more closely with sustainable growth and societal well-being, bolstered by evidence-based policies that prioritize economic stability and equality. The potential benefits of her tax measures, such as the expansion of the Child Tax Credit, are backed by data showing significant reductions in poverty and inequality.
In conclusion, the upcoming election holds significant implications for the American economy and its citizens. A Harris administration stands as a bulwark against potential economic upheaval, safeguarding the nation’s unprecedented recovery and fostering a path of sustainable growth and shared prosperity. The choice is clear – a vote for economic stability and progress.
