After the Federal Reserve cut interest rates by half a point on Sept. 18, President Biden called the move a “declaration of progress.” Inflation isn't yet whipped, but victory is coming into view.
There’s some other progress that’s important for Democrats. Voters and investors are warming to Vice President Kamala Harris’s economic plan as the Democratic presidential nominee and her Republican opponent, Donald Trump, enter the home stretch of the campaign. Even better for Harris, voters seem to blame her less than Biden for the high inflation of the last three years, which sent Biden’s approval rating into an unrecoverable nose dive.
The Financial Times has now conducted two monthly polls in a row in which voters say they trust Harris more than Trump to handle the economy. When Biden was still in the race, Trump beat him handily on the economy. But Harris inched ahead of Trump in August and expanded that lead slightly in September.
That FT poll looked like an outlier back in August, but other data now shows Harris drawing even with Trump on the economy. The latest Morning Consult poll finds 46% of voters trust both Harris and Trump on the economy. On issues such as the cost of living, housing affordability, and jobs, Harris’s approval rating exceeds Biden’s by 25 percentage points or more. That’s a startling shift, given that Harris’s policies are quite similar to Biden’s and she is, after all, the incumbent.
In a recent Quinnipiac poll of swing states, voters in the crucial state of Pennsylvania rate Harris higher than Trump on the economy by two points. She’s two points behind on the economy in Michigan and four points behind in Wisconsin, yet once again, she’s closing a large gap. In University of Michigan surveys, 41% say Harris would be better for the economy, while 38% say Trump would be better, and 15% think it won’t make any difference.
Finally, in monthly surveys of business executives by Oxford Economics, a Trump presidency ranks as the top geopolitical concern during the next year. Worries about the adverse effects of a Trump presidency have climbed for three months in a row, with 43% of respondents now saying another Trump presidential term would pose a significant risk to the global economy. That’s largely because of Trump’s promise to enact sweeping tariffs and deport millions of working migrants. A Harris presidency doesn’t register as a geopolitical risk, as it would, in many ways, represent a continuation of the status quo.
Democratic presidential nominee Vice President Kamala Harris listens as she joins Oprah Winfrey at Oprah's Unite for America Live Streaming event Thursday, Sept. 19, 2024 in Farmington Hills, Mich. (AP Photo/Paul Sancya) ·(ASSOCIATED PRESS)
These improving views of a Harris economy and dimming views of a Trump economy aren’t happening in a vacuum. Forecasting firms such as Goldman Sachs crunched the numbers and concluded that Harris’s policies would be better for economic growth than Trump’s. Those types of analyses typically assume each candidate can get Congress to fully enact favored policies by passing legislation, which isn’t always realistic. Yet Trump’s most concerning economic policies — tariffs and deportation — are things he could do largely without congressional approval. Harris's most disruptive policies — a higher corporate tax rate and a new wealth tax, for instance — would only be possible under a Democratic sweep of Congress and the White House, which seems unlikely.
Harris, meanwhile, has focused heavily on pocketbook issues such as more affordable housing, healthcare, and childcare. The Morning Consult survey found such policies to be highly popular, and it also found that voters broadly associate those policies with Harris. Trump has few specific ideas for lowering everyday costs.
None of this means Harris is cruising to victory. The race remains incredibly close, with the final electoral vote tally likely to come down to small pockets of swing voters in six or seven states. In the Michigan surveys, independent voters seem to favor Trump on the economy, which could spell trouble for Harris among the late-breaking swing voters she'll need to win.
What Harris seems to be doing, however, is neutralizing what was once Trump’s biggest advantage. As ever, the economy is the top issue for voters, and when Biden was the Democratic candidate, Trump’s edge on the economy was beginning to look indomitable. Before Biden withdrew in July, betting markets gave Trump 66% odds of winning and Biden just 18%, with Harris and other potential Biden replacements making up most of the rest.
The same betting markets now give Harris 52% odds of winning, and Trump 47% odds. That says more about momentum than the actual likelihood of winning, but at the moment, you’d rather have Harris’s mojo than Trump’s. It's too early for Harris to declare victory, but a declaration of progress would be fitting.
