Democrats have warned that VP Harris needs to solidify her messaging on the economy before former President Trump ties her to a narrative that dogged Biden when he was the candidate.
Before Biden dropped out of the race last month, the economy was a top issue for voters, with a series of polls showing Trump leading on the issue. Surveys concluded that voters trusted Trump more than Biden on economic issues.
But the news cycle over the past six weeks has been dominated by a series of political headlines, including uncertainty within the Democratic Party following Biden’s dismal debate performance, the assassination attempt on Trump, the former president’s selection of Sen. J.D. Vance (R-Ohio) as his vice presidential running mate, and the Republican National Convention.
Less than a week later, the transition from Biden to Harris grabbed headlines, followed by two weeks of Harris frenzy, fueled by attention on her own running mate.
Democrats haven’t had to worry too much about policy in the meantime, as Republicans have focused mostly on Harris’ identity politics, including her race and ethnicity. But Democrats say Harris and her running mate, Minnesota Gov. Tim Walz, must go on the offensive on the economy before Republicans can bring it back to the forefront of the campaign.
“The big question is, ‘Can we win the messaging war there? Can we win people’s hearts and minds and win the conversation about what the future looks like?'” Payne said. “Obviously Republicans have traditionally had the advantage in that regard, but we need to make sure that the case over the last three years is being put into the context of ‘Who do we trust in the future’ when it comes to the economy.”
One major Democratic donor said Harris is currently “exonerated” on the economy and other major policy issues. “But she needs to be ready to present a strong economic argument,” the donor warned. “Biden has had a hard time getting that message across clearly.”
The issue has taken on greater urgency as the economy nears a tipping point after a period of interest rate hikes and quantitative tightening implemented by the Federal Reserve in response to soaring inflation after the pandemic.
The key recession indicator, known as the thumb rule, was triggered by the unemployment rate rising to 4.3% last week. Markets are widely expecting the Fed to cut interest rates at its next meeting to begin stimulating the economy.
Polls taken after Biden’s withdrawal showed Harris closing the gap with Trump on his handling of the economy overall. A Morning Consult poll released this month found that 50% of voters trust Trump on economic issues, while 42% trust Harris. That’s a stark difference from earlier this year, when 51% trusted the former president on the issue and 37% trusted Biden.
A recent Marist College poll found Trump holding a slight lead over Harris on how well he could manage the economy, 51 percent to 48 percent.
Biden has struggled to gain political momentum from the economy, which has endured an unusual period during his presidency, with the pandemic’s aftermath shattering many traditional assumptions about its performance.
Employment levels remained near record highs even as the Federal Reserve raised interest rates and shrunk its balance sheet. The central bank and many economists predicted a recession in 2023, but that never materialized. Corporate profits soared to record highs and economic growth beat expectations for several quarters.
But high inflation has weighed on consumer sentiment and economic approval ratings, and Biden has been unable to capitalize on these impressive metrics: In May, only 38% of Americans had confidence in Biden’s management of the economy, but that figure is set to fall to 35% by 2023, according to Gallup, a figure lower than any other recent president, only George W. Bush after the 2008 financial crisis.
In contrast, Trump’s economic approval rating in the survey was 46 percent, roughly the same as he had maintained throughout his presidency. Trump has led a campaign that has produced relatively low unemployment and inflation. Trump’s campaign focused its attention on the economy with several bold economic proposals, including a 10 percent general tariff on imported goods to replace the income tax.
He has also spoken about tough restrictions on immigration as a way to boost domestic wages and jobs, calling it “the biggest [factor] Trump has maintained a “first-mover” approach to designing economic policy, and investors told The Hill that companies may resist access to cheap labor, while some researchers worry that his policies could spark inflation.
According to The Wall Street Journal, Trump’s advisers have even drawn up plans to limit the power of the Federal Reserve, the nation’s legally independent central bank, which wields significant power over the economy. Trump has frequently criticized Fed Chairman Jerome Powell during his presidency and railed against him during his election campaign.
Trump’s economic message and anti-globalization rhetoric have resonated with his supporters as well as those who have voiced support for other Republican candidates.
“Let’s stop and be honest for a second,” JPMorgan Chase CEO Jamie Dimon said at an economic forum earlier this year. “He was kind of right about NATO. He was kind of right about immigration. He grew the economy pretty well. Trade worked well, tax reform worked well. He was partly right about China.”
According to a source close to the campaign, Harris is working on her message on the economy and has brought in former Biden adviser Gene Sperling and others to help her.
So far, the Harris camp’s stance on economic policy has been largely in line with the Biden camp, pointing out many of the same points, including jobs, health care and lower inflation, while criticizing conservative proposals.
Harris outlined her economic policy message while campaigning in Philadelphia on Tuesday.
“We’re fighting for a future where we build a broad-based economy and where every American has the opportunity to own a home, start a business and build wealth,” she said. “We’re fighting for a future where prices are lowered that are still too high, where the cost of living for American families is lowered so they have the chance not just to survive, but to get ahead.”
Kevin Madden, a veteran Republican strategist who advised Sen. Mitt Romney (R-Utah) in the 2012 presidential election, said the election will still likely be decided by “voters’ mood on the economy, and that mood is being fueled by concerns about inflation and rising prices.”
Madden said Harris should “hold the Biden administration accountable for its policies and performance, but only if Trump ensures that.”
“The downside of Trump and Vance’s initial counter message to Harris, which revolved around identity politics and cultural issues, is that they squandered an opportunity to win over swing voters on their top issue: the economy.”
President Trump suddenly addressed the economy during a press conference on Thursday, warning that recent economic data suggests the US could be on the brink of a severe recession.
“The economy is so bad right now, we may literally be in the midst of a recession,” he said, though there is little warning of a recession among economists.
Investors and economists told The Hill that the Harris-Waltz campaign should move away from boilerplate economics and capitalize on the unexpectedly strong performance of the party that Harris helped oversee.
Rather than focusing on the well-known strength of the job market, Democrats should drown out narratives of high inflation by highlighting hard numbers for wage growth, Dan Alpert, founding partner at Westwood Capital, told The Hill.
“It is important to remind Americans that in February 2020, on the eve of the pandemic, the average weekly wage for all private sector employees was $979. Today it is $1,200,” Alpert said in an email.
“Stop talking about how many jobs have been created. Americans know that’s distorted by post-pandemic reemployment. Focus on the money in their pockets,” he continued.
Alpert also said that beyond individual metrics and talking points, Harris should expand on Biden’s working-class economic vision, reflected in his fervent support for unions, and move away from recent big-picture policy norms.
“[This is] “The issue that Harris and Waltz can ignore to get Trump reelected is the economic and physical insecurity of the bottom third of the population,” he said. “This is both Trump’s strength and his Achilles heel as a Republican. Democrats need to be forceful in rejecting the Clinton-era embrace of neoliberalism that has led to the polarization of wealth and income.”
