Harris unveils economic agenda to combat soaring grocery and housing prices

In her first major policy speech since becoming the Democratic presidential candidate, Vice President Kamala Harris laid out her vision for combatting rising prices, one of the biggest issues for voters in this year’s election and one that’s dogged the Biden-Harris administration. Amna Nawaz discussed the specifics of Harris’ economic policy proposals with Jeanna Smialek of The New York Times.

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Geoff Bennett: It was her first major policy speech since becoming the Democratic presidential candidate last month.

Amna Nawaz: This afternoon, Vice President Kamala Harris laid out her vision for combating one of the biggest issues for voters in this year’s election and one that has dogged the Biden/Harris administration, rising prices.

Today, Vice President Harris on the trail in North Carolina as her campaign unveils its economic agenda.

Kamala Harris, Vice President of the United States (D) and U.S. Presidential Candidate: Costs are still too high. And on a deeper level, for too many people, no matter how much they work, it feels so hard to just be able to get ahead.

Amna Nawaz: The focus, they say, lowering costs for everyday Americans. New data this week shows inflation cooling year over year, but a recent swing state voter survey shows, on economic issues…

Donald Trump, Former President of the United States (R) and Current U.S. Presidential Candidate: They say it’s the most important subject.

Amna Nawaz: … Harris’ Republican opponent, former President Donald Trump, still has an edge; 48 percent of respondents said they trust Trump more to get inflation and the cost of living under control compared to 42 percent for Harris.

Trump’s lead is, however, shrinking compared to how he fared against President Biden on the same issue. Meanwhile, at a Trump campaign event in New Jersey last night…

Donald Trump: We wouldn’t have inflation. We wouldn’t have had the Israeli attack.

Amna Nawaz: … the former president veered off script once again from planned remarks on combating antisemitism to a controversial comment about Republican megadonor Miriam Adelson.

In 2018, Trump awarded Adelson the Presidential Medal of Freedom. Last night, he claimed that award was — quote — “better” than the highest decoration for members of the U.S. military.

Donald Trump: It’s actually much better because everyone gets the congressional Medal of Honor. That’s soldiers. They’re either in very bad shape because they have been hit so many times by bullets or they’re dead.

Amna Nawaz: A progressive veterans political action committee, VoteVets, that’s endorsed Harris called Trump’s remarks insulting, saying — quote — “Donald Trump doesn’t respect veterans and their sacrifice.”

But Trump’s running mate, Ohio senator and military veteran J.D. Vance, defended Trump at the Milwaukee Police Association today.

Sen. J.D. Vance (R-OH), Vice Presidential Candidate: This is a guy who loves our veterans and who honors our veterans. I don’t think him complimenting and saying a nice word about a person who received the Presidential Medal of Freedom is in any way denigrating those who received military honors.

Amna Nawaz: It was Vance’s second stop in Wisconsin this month after being named Trump’s running mate at the Republican National Convention in Milwaukee in July.

The Democratic National Convention will begin next week in neighboring Illinois, where Harris is expected to roll out additional detailed policy proposals.

For more on the specifics of Harris’ economic policy proposals, I’m joined by Jeanna Smialek, economics reporter for The New York Times.

Jeanna, thanks for being with us.

Jeanna Smialek, The New York Times: Thanks for having me.

Amna Nawaz: So, let’s start with the Harris campaign’s plan to address what they call price gouging here and what they blame in part for higher grocery prices.

The Harris campaign says that she would implement the first ever federal ban on corporate price gouging and will work with the FTC and Congress to do so.

So, Jeanna, what exactly are they proposing that they would do on this front? And knowing what you do about why grocery prices are where they are, could this approach actually work to bring those prices down?

Jeanna Smialek: So what exactly is kind of the key question here? And the answer is, we don’t know yet. We do not know exactly what this policy would look like.

And I think the devil is really in the details. We do not know how they go about preventing price gouging or even how they’re defining price gouging at this point. What we do know is that profits went up quite a lot in the grocery sector during the sort of aftermath of the 2020 pandemic.

So, in 2021, we saw profit shoot up at grocery stores and they stayed up for a while. That was pretty consistent with what we saw across the economy. We really saw a lot of companies raking in a lot more profits because they were charging more. As costs had started to shoot up, they were charging more to try and cover those costs and they actually even charged a bit more than was just necessary to cover costs during that period.

And so there are a lot of people out there, a lot of economists, particularly on the progressive side of the aisle, who have been saying things like this was an example of price gouging. This was an example of what happens when you have an imperfectly competitive marketplace and really saying that we need to see some sort of response from the government on this.

And that is what we’re potentially seeing here. Now, you will get economists on the other side saying that this was an economy that basically worked the way you would expect. We had shortages for things. We had shortages for eggs. We had shortages for a lot of grain-type things during this period. And as a result, companies were charging more because things were in short supply and they could charge more.

And that resulted in more production and then prices came down. And so some economists are saying, this is econ 101. This is how things work. If you put some sort of price mechanism or in some way stop the economy working from working the way that it just would on its own, you might not have that supply come online.

And at the same time, progressive economists are really celebrating this. So you have got a very, very contentious debate without a lot of detail.

Amna Nawaz: And the devil, as you say, is in those details.

So let’s move on to housing then, we know is another big piece of this policy proposal. And on addressing the housing shortage and affordability problem in America, this is what the Harris campaign says they will do. They say that a potential President Harris would call for the construction of three million new housing units over the next four years, also that the government would provide first-time homebuyers with up to $25,000 in down payment assistance.

Jeanna, from the experts you talked to who have looked at these plans, how viable our plans like this for that kind of level of building and what’s their potential impact?

Jeanna Smialek: Yes, so I think there are two big questions here. One is political viability and the second is economic viability.

So when it comes to the political viability side, this stuff would have to pass Congress. In order to get those three million new homes built, you would really have to have a lot of — the way the Harris campaign is proposing to do it is through a lot of incentives for homebuilders and for local housing authorities to really sort of encourage home building.

And that money needs to come from Congress. So I think there’s a real question, could you get it through? What does Congress look like? Is this going to be possible?

Then, on the back side of that, you have got to say, would it work and would it work in the time frame that the Harris campaign is talking about? Because it’s a pretty ambitious, pretty accelerated time frame they’re laying out here. She’s saying those three million units will go up within the four years that she’s — the first four years that she’s in office.

And so I think that those are those are some big questions. And then flip side here is, if you’re not building enough supply and you’re giving employer — or you’re giving first-time homebuyers $25,000 as a credit, is there a risk that just all goes to prices? Is there a risk that home sellers can just charge more these, because now homebuyers can afford to pay more?

And so I think this is a big, knotty set of questions that will really depend on sort of the political and practical realities at the moment.

Amna Nawaz: Well, another set of proposals that would also have to go through Congress has to do with the child tax credit.

On that, the Harris campaign says that she would propose not only restoring the child tax credit that was first introduced during the pandemic of $3,000 per child under the age of 18, up to $3,600 per child under the age of 6, but expanding the provision to $6,000 per child under the age of one for middle- and low-income families.

So what’s the viability for a plan like that and what kind of a difference could that make?

Jeanna Smialek: Yes, so this is a fascinating one because there really is a lot of bipartisan support for the child tax credit, in fact.

You actually saw J.D. Vance over the weekend talking about how he’d love to see a bigger child tax credit. And so I think that there is some possibility that Republicans would reach across the aisle on this one, that you could get something through Congress on the child tax credit.

I think the huge question, though, is, how do you pay for it? It obviously is expensive to do these things. The Harris campaign hasn’t laid out in detail how they’re planning on paying for these kinds of policies. They do mention in their campaign briefings things like making corporations and wealthy Americans pay their fair share.

But, at this point, we don’t have any sort of detailed explanation of how these policies would be offset in the budget. And so I think that’s the big question here going forward.

Amna Nawaz: Jeanna, briefly, if you can, when you look big picture at these policy proposals, how do they compare to some of the proposals and the policies we have seen from the Biden administration?

Is this the Harris campaign going in a new and different direction or more of the same?

Jeanna Smialek: Yes, so I think a lot of this actually really builds on sort of the Biden agenda, but then takes it just a step further and makes it a little bit more dramatic, maybe a little bit more populist in some cases, like the price gouging proposal, and certainly tries to really tackle a lot of kitchen table issues surrounding costs and price increases that have really just bedeviled the Biden/Harris White House.

These have been real issues that they have struggled to sort of connect with voters on, and it seems like she’s tackling them pretty head on here.

Amna Nawaz: That is Jeanna Smialek, economics reporter for The New York Times.

Jeanna, thank you so much. Good to speak with you.

Jeanna Smialek: Thanks for having me.