It’s natural for presidential candidates to make promises about their goals should they get elected. Often, those promises are bold plans for legislation the candidate wants to sign, whether it is tax policy, healthcare policy, or anything else.
But the 2024 presidential race is different. Populism is at the heart of mainstream politics today. Instead of engaging the electorate with a vision for the future, former President Donald Trump and Vice President Kamala Harris continue to appeal to emotion and promise policies that play to voter anger.
These promises, while seemingly appealing, raise concerns about their feasibility and effects on the economy. Harris kicked it off when she promised to implement the first-ever federal ban on “price gouging.” She said it was necessary since grocery prices have increased 25% since 2020, and her only conclusion is that such increases are the result of “corporate greed.” Never mind that grocery stores have razor-thin profit margins or that trillions in government spending during the pandemic brought about inflationary pressures not seen in decades. It must be the CEOs behind the curtain, similar to the Wizard of Oz, directing stores to raise the prices of milk and eggs so they can inflate their profits.
Harris also promised to give first-time homebuyers $25,000 in down payment assistance to buy a home. The average sale price of a home in the United States is $416,000, according to Rocket Homes. Her idea does nothing to address the root cause of why homes are so expensive: Inventory is low, and interest rates are high. When the Federal Reserve cut interest rates to near zero during the pandemic, the rate for a 30-year mortgage plummeted to as low as 2.5%. As companies allowed employees to work remotely, people began snapping up available homes. With low availability, sellers don’t have much incentive to reduce their sale prices, and adding more buyers with $25,000 in assistance will only exacerbate the problem.
The vice president recently floated the idea of capping child-care costs for “working families” at 7% of their income. Child care is expensive, but a price cap for a segment of the population will only increase the cost for everyone else. It’s as if politicians need help understanding cause and effect.
Trump’s ideas are no better. He continues to believe tariffs will raise more revenue than they do. He appeals to voters who are angry about imports from China and other Asian countries supposedly “taking away” jobs from people in the U.S. His running mate, Sen. J.D. Vance (R-OH), perpetuates the myth that high tariffs will immediately result in the building of factories in the U.S.
In 2017, Trump signed a tax bill that limited state and local tax deductions to $10,000. That provision hit wealthier taxpayers, particularly those in blue states with high property taxes. The Peter G. Peterson Foundation found that, in 2017, the final year before the cap went into effect, “71% of the benefit for the SALT deduction … went to taxpayers with incomes over $200,000.”
In what is likely a move to secure more wealthy, college-educated voters, Trump is promising to reverse the cap.
Trump recently said he would cap credit card interest rates at 10% immediately after taking office. It’s a terrible policy, even if he could do it. Credit card issuing banks would immediately reduce credit availability and likely increase fees to recoup those costs and shift cost burdens elsewhere to compensate for the lost revenue.
CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER
Additionally, Trump almost assuredly does not have the authority to do it. President Joe Biden recently had the Consumer Financial Protection Bureau implement an $8 cap on credit card late fees, which was immediately blocked by a federal judge. It is difficult to see how an executive order or rule doing the same for credit card interest survives judicial scrutiny.
Meanwhile, the federal deficit is nearly $2 trillion, the national debt is $35 trillion, and Social Security and Medicare will go insolvent in under 10 years. Neither candidate has uttered a word about any of it other than to accuse the other of doing something horrible with Social Security and Medicare. But that’s to be expected when people react more to “price gouging” and credit card interest rates.
Andrea Ruth is a contributor to the Washington Examiner magazine.