STEVE INSKEEP, HOST:
The candidates are in a relentless competition for votes, and as they throw out ideas, we learn their economic plans. This week, Harris said she favors an expanded child tax credit - $6,000 for parents of newborns. Joe Brusuelas of the financial advisory firm RSM is evaluating that.
JOE BRUSUELAS: This is an outgrowth of the policy that was put in place during the pandemic, one that was enormously successful, which helped deal with the pandemic, which resulted in a steep drop in the poverty rate. This does reflect the move of both parties towards a different form of populism. But here, there's at least a common thread.
INSKEEP: A common thread and a bit of competition as well. If I'm not mistaken, JD Vance, the Republican vice presidential nominee, said something about this, and then Harris made her proposal, which is larger.
BRUSUELAS: That's right. I think the economics of this is solid and that if we weren't in a presidential election year, it would have already been passed. Now, what's interesting about this is JD Vance is for it. Harris is for it. I'm not so sure Donald Trump is.
INSKEEP: Should we worry about the government having to borrow money to do this, even if it is popular on a bipartisan basis right now?
BRUSUELAS: Well, we can't have everything. So we should always take into account, how, if possible, will we pay for this?
INSKEEP: President Biden, who was the Democratic candidate until recently, had talked about allowing taxes to go back up for the wealthiest Americans. We have less clarity about Vice President Harris, but she has said she would like to raise the corporate tax from 21% up to 28%. Would that bring in a lot of money?
BRUSUELAS: Well, that would. It would bring in substantial sums of revenue, depending on how it's structured and the time over which - in which it was phased in. That's the art of the deal. That's politics.
INSKEEP: You mentioned the art...
BRUSUELAS: Yeah.
INSKEEP: ...Of the deal. Hasn't the guy who was the author of "The Art Of The Deal" - or credited as the author - said that he wants to extend all the tax cuts?
BRUSUELAS: He does. And that's one of the things we're going to have to watch because we know that Mr. Trump has a bias towards expansionary fiscal policy. And my sense is that he wants to sell it. But paying for that - well, that will be somebody else's problem down the line.
INSKEEP: Let's talk about another thing that we've learned about Vice President Harris' economic ideas. There's a housing shortage in the United States. A lot of people are struggling with housing costs. The vice president talks about 3 million housing units new in four years. First, how could a president even do that? And second, is it practical?
BRUSUELAS: Well, you can't do it through a stroke of a pen. The federal government has to engage in substantial partnership with the state and local governments, as well as the private sector. And indeed, we're 3 million homes short based on changes in demography. So we have a chronic shortage of supply. We need to begin to build homes - really affordable homes, starter homes - at accessible prices.
INSKEEP: Is this such a vast problem that a presidential candidate really can't even tell us how she would get it done - she just has to say, I'm going to make this a priority, and I'll try different things?
BRUSUELAS: Well, at one point, it'd be a good idea if we got that sort of transparency and we got that sort of speech. But during the week of the Democratic National Convention, when messaging triumphs - well, I'm not holding my breath on that, Steve.
INSKEEP: Vice President Harris has also talked about ending price gouging on groceries, controlling grocery prices somehow. How would that work?
BRUSUELAS: Well, no one's really sure. You know, if it's an exercise in oversight, it's incredibly appropriate, especially around retail, food, gasoline, right? But if it's done in a nonserious way just to appease the public, the distortions it can cause - it really will end up probably causing prices to go up.
INSKEEP: We have talked on the program in the past about former President Trump's economic proposals, including his proposals on tariffs, but let's just fit that into the context here. If Trump is the president next year and succeeds in imposing a 10% tariff on everything coming into the United States, which is one of many things that he's talked about, how does that affect the economy?
BRUSUELAS: Well, you have to put it in a broader context, right? So if he's going to put a 10, 20 or 60% tariff on everything, depending on what day it is and what the level is, you're going to see a bias towards higher prices.
INSKEEP: The former president has been campaigning by saying that these tariffs are not ultimately a tax on American consumers, that it's a tax on other countries. Is he correct?
BRUSUELAS: That's simply not true. When we put tariffs on imported goods, those taxes, which is what tariffs are, are collected at the point of entry. And the people who pay them - those are the firms who are importing the goods. And then those firms tend to turn and pass along those price increases downstream to consumers.
INSKEEP: Joe Brusuelas is the chief economist for the consulting firm RSM. Thanks so much.
BRUSUELAS: No problem. Thank you. Transcript provided by NPR, Copyright NPR.
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