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The stories that matter on money and politics in the race for the White House
The prospect of another four years of Donald Trump “should make business leaders shudder”, a leading Democratic think-tank has said, pointing to his plans including higher tariffs that could drive up costs for companies and consumers.
In a report published on Friday, the centre-left think-tank Third Way said Trump’s protectionist trade proposals, threats to end the Federal Reserve’s independence and vows to crack down on immigration, including for skilled workers, should alarm executives.
The 10-point memo also cited Trump’s plan to expand his 2017 tax cuts that economists say would add trillions to US debt, as well as his comment that chief executives should be “fired for incompetence” if they do not support him.
“He portrays himself as this businessman and the saviour of business,” said Gabe Horwitz, senior vice-president of Third Way’s economic programme and a co-author of the report. “What he is proposing would absolutely decimate the US economy and really hurt businesses.”
The report comes as Kamala Harris, the vice-president and Democratic presidential candidate, draws level with Trump in many polls with just over 80 days to go until November’s election.
Before President Joe Biden dropped out of the race last month, he and Trump both outlined protectionist plans as they competed to capture blue-collar votes in critical swing states across industrial heartlands of the US midwest.
Several business leaders have also criticised Biden’s administration for its aggressive antitrust stance and regulatory agenda.
Trump, a former real estate magnate, has touted his business acumen while courting the support of deep-pocketed donors from Wall Street to Silicon Valley with his promises to cut taxes and slash regulations. He has won the backing of several high-profile hedge fund and tech billionaires, including Steve Schwarzman, Bill Ackman and Elon Musk.
In a speech on Wednesday in North Carolina and a press conference at his New Jersey country club on Thursday, the former president promised a “brand new Trump economic boom” if he wins another four years in the White House. His defeat to Harris would induce a “1929-style depression”, he said.
“We wanted to do a speech on the economy. A lot of people are very devastated by what has happened with inflation and all of the other things,” Trump said on Wednesday. “They say it is the most important subject. I am not sure it is, but they say it’s the most important subject.”
The Republican candidate vowed to bring down the prices of cars, housing, insurance and prescription drugs, as he blamed Biden and Harris for a surge in inflation in recent years.
But he has also pledged to impose an aggressive tariff regime that economists have warned would drive up prices for imported goods. Trump has previously floated the idea of 10 per cent tariffs on all imported goods, but on Wednesday indicated he could double the levy.
“We’re going to have 10 to 20 per cent tariffs on foreign countries that have been ripping us off for years,” Trump said.
Trump has also vowed to impose a tariff as high as 60 per cent on goods imported from China. Biden earlier this year also imposed higher tariffs on some goods from China, including a levy of up to 100 per cent on electric vehicles.
Trump’s running mate, Ohio senator JD Vance, has alarmed some Wall Street executives with his own protectionist policy proposals and praise for Lina Khan, the Biden administration’s aggressive head of the Federal Trade Commission.
Harris is set to deliver her own speech teasing out an economic agenda on Friday in North Carolina, as the vice-president tries to carve out her own positions since she replaced Biden as the Democratic candidate.
She is expected to use the speech to announce a crackdown on what her campaign has dubbed “corporate price-gouging”, especially on food and grocery items, as well as lay out proposals to make housing more affordable, including tax incentives for homebuilders who construct starter homes for first-time homebuyers, and tax credits of up to $25,000 for eligible first-time homebuyers.
Polling of US voters consistently showed they were unhappy with Biden’s handling of the country’s economy — which they rank as the most important issue in the election — and especially anxious about inflation, which hit multi-decade highs in 2022 but has drifted lower since then.
But the most recent FT-Michigan Ross poll this month showed Harris narrowly ahead of Trump on whom voters trusted more on the economy.
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