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    2025 Could Be a Great Time to Be President, Economically Speaking

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    Trends already underway make for a sunny outlook over the next few years. The question is who will get to take credit.The next couple of years are shaping up to be solid for the U.S. economy. Inflation is returning to normal. As that happens, the Federal Reserve is preparing to cut interest rates. A huge burst of infrastructure spending under the Biden administration has taken time to ramp up, but projects both small and large are likely to break ground in earnest in 2025 and 2026.Things can always go wrong — the job market could cool more than expected, financial market problems could surface, and risks tied to the election in November could stoke uncertainty — but the base-case outlook is bright. The question now is who will get to take credit for it.One clear answer: It won’t be the person who shepherded some of the policies that are laying the positive groundwork. President Biden announced on Sunday that he was ending his candidacy for re-election, passing the Democratic baton to Vice President Kamala Harris.Mr. Biden isn’t entirely responsible for the sunny outlook. White House officials play a relatively minor role in slowing inflation and exert no direct control over interest rates. But big policy packages passed on his watch are helping to fuel a burst in green-energy, manufacturing and infrastructure investment that is expected to continue over the next several years. Expansions of dams and locks will be underway. Dozens of airport upgrades will be completed. Semiconductor factories will begin churning out chips.It’s a reminder that big and potentially transformative public investments can take time — and multiple political cycles — to play out. It could also be an opportunity for the next resident of the White House to take a victory lap.Former President Donald J. Trump is already hinting at an optimistic future on the campaign trail. The Republican platform, which he had a heavy hand in shaping, pledged to “destroy inflation” and vowed that interest rates would be lower while declaring that the Republican Party will be one of infrastructure and manufacturing. If economists’ most likely projections come true, those promises should be well within reach.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    U.S. Economy Grew at 2.8% Rate in Latest Quarter

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    The report on gross domestic product offered new evidence of the economy’s resilience in the face of high interest rates.Economic growth remained solid in the spring, as cooling inflation and a strong labor market allowed consumers to keep spending even as high interest rates weighed on their finances.Gross domestic product, adjusted for inflation, increased at a 2.8 percent annual rate in the second quarter, the Commerce Department said on Thursday. That was faster than both the 1.4 percent rate recorded in the first quarter and than forecasters’ expectations, but down from the unexpectedly strong growth in the second half of last year.Consumer spending, the backbone of the U.S. economy, rose at a 2.3 percent annual rate in the second quarter — a solid pace, albeit much slower than in 2021, when businesses were reopening after pandemic-induced closings. Inflation, which picked up unexpectedly at the start of the year, eased in the second quarter.The data is preliminary and will be revised at least twice.Taken together, the data suggested that the economy remains on track for a rare “soft landing,” in which inflation cools without triggering a recession. That is something few forecasters considered likely when the Federal Reserve began raising interest rates to combat inflation two years ago.“The economy is in a transition, but it’s in a good place,” said Ryan Sweet, chief U.S. economist at Oxford Economics. “The economy is slowing from very strong growth in the second half of last year. We’re just settling down into something that’s a little more sustainable.”Fed officials will meet next week to weigh when to begin lowering interest rates, which they have held at their current level, the highest in decades, for the past year. Hardly anyone expects policymakers to cut rates next week, but they could signal that such a move could come as soon as September if inflation continues to cool.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    On Economic Policy, Harris Has Played Limited Role

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    President Biden has not given his vice president an expansive economic portfolio. But she has engaged on issues of small-business lending, help for parents and more.Shortly after the Biden administration took office in 2021, Vice President Kamala Harris started calling the chief executives of large banks, including JPMorgan Chase and Bank of America.The federal government was making hundreds of billions of dollars available for banks to lend to small businesses to keep them afloat during the pandemic recession. Ms. Harris told the executives they needed to be lending more, faster, particularly to minority-owned businesses that data suggested were struggling to gain access to the money.The calls represented one of the earliest and most visible forays Ms. Harris made in devising and carrying out the Biden administration’s economic agenda, and illustrated the sort of economic policy niche that she has filled as vice president.Current and former administration officials, progressive leaders outside the White House and allies of Ms. Harris roundly agree that the vice president, who is now the leading candidate to secure the Democratic presidential nomination, did not play a major role in the creation of the sweeping economic legislation that has defined President Biden’s time in office.Ms. Harris was rarely a loud voice in major economic debates, like the ones over how to counter soaring inflation in 2021 and 2022. She did sometimes attend economic briefings, but was not always a big contributor in them. One attendee recalled her coming to an economic briefing, but simply listening to the presentation while Mr. Biden asked questions.Other officials say Ms. Harris largely focuses her questions for economists on how certain policies affect workers and families at a personal level — a trait she shares with the president.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Can Kamala Harris Sell Bidenomics?

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    Much of President Biden’s agenda polls well, but voters roundly dislike his handling of the economy. That’s a campaign challenge for his vice president, as she mounts a presidential bid.President Biden has signed more major economic legislation than any other president has this century. He presided over record job growth and a recovery from pandemic recession that was the envy of the wealthy world. He crafted an ambitious, multinational industrial policy meant to help America and its allies rebuild strategic manufacturing capacity to counter China.But voters gave Mr. Biden little credit, focusing instead on the inflation surge that plagued much of Mr. Biden’s term.That shortcoming was jeopardizing Mr. Biden’s re-election chances well before he fumbled through a televised debate last month and re-inflamed questions about his age. Polls showed that the economy and prices topped voters’ issue concerns, and that they roundly preferred former President Donald J. Trump to Mr. Biden on the issue.As Mr. Biden steps away from the 2024 campaign and Vice President Kamala Harris tries to rally support for the presidential nomination, economic questions loom large over her candidacy.Will Ms. Harris, 59 and unburdened by the age questions that dogged Mr. Biden, fare any better at selling the Biden-Harris economic record — including its investments in low-emission energy, advanced manufacturing and other industries? Can she maintain Mr. Biden’s connection to certain blue-collar voters in pivotal states like Michigan and Pennsylvania, while re-engaging economically disaffected young voters who had grown disillusioned with the president?And can she overcome voter anger over inflation, which peaked at 9 percent in 2022 but has since fallen closer to the Federal Reserve’s target rate of 2 percent?We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    A Harris Economy Could Prove More Progressive Than ‘Bidenomics’

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    At the first Democratic presidential debate in 2019, Kamala Harris, then a senator from California, unleashed a scathing critique of the Trump economy.The future vice president billed President Donald J. Trump’s tax cuts as a giveaway to the rich, argued that the booming stock market was leaving the middle class behind and warned that his reckless trade agenda was hurting farmers in the heartland.“Frankly, this economy is not working for working people,” Ms. Harris said. “For too long the rules have been written in the favor of the people who have the most and not in favor of the people who work the most.”As Ms. Harris prepares to potentially replace President Biden atop the Democratic ticket, she now faces the challenge of articulating her own vision for steering a U.S. economy that is still grappling with inflation while drawing sharp distinctions with Mr. Trump, who has promised more tax cuts and tariffs.Ms. Harris has been an ardent defender for the White House’s economic agenda during the Biden administration, promoting the benefits of legislation such as the American Rescue Plan of 2021 and the Inflation Reduction Act of 2022. But as an attorney general and a senator, she was at times more progressive than the president, pushing for universal health care while calling for more generous tax benefits for working-class Americans and paying for them with bigger tax increases on companies.In recent weeks, Ms. Harris has embarked on an economic “opportunity tour,” making the case that wage increases have been outpacing inflation, that manufacturing jobs are growing and that Democrats have been fighting to forgive student loan debt. Those arguments now foreshadow the case she will be making to voters as she runs against Mr. Trump.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Biden Rent Cap Proposal Reignites Housing Policy Debate

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    A proposal to make landlords’ tax breaks contingent on rent limits has drawn industry pushback, progressive applause and some alternative approaches.When the Biden administration laid out a suite of plans this week to address housing affordability, it added a bold update to previous proposals — and sent the housing industry and the economics world buzzing.The White House called on Congress to pass legislation giving “corporate landlords” — defined by the White House as those with over 50 rental units — a choice to cap annual rent increases on existing units at 5 percent annually or lose federal tax breaks based on property depreciation.The proposal is expected to go largely unaddressed this year, with Congress in campaign mode. But public reaction has been lively.Tenant organizations and progressive leaders generally allied with the administration’s economic team cheered the news. Yet a range of economists, Wall Street analysts, real estate groups and landlord associations responded with forceful critiques, assailing the limits as counterproductive.“Increasing the supply of affordable rental housing nationwide — not politically motivated and self-defeating rent control proposals floated during election campaigns — is the best way to alleviate affordability constraints for renters,” Robert D. Broeksmit, the president of Mortgage Bankers Association, said in a statement.The policy would affect about 20 million units in the country, roughly half of all rental properties.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    No Taxes on Tips? A Trump Idea Gains Ground.

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    The sudden popularity of exempting tips from taxes is a reminder of the improvisational nature of economic policymaking under Donald Trump.In Donald J. Trump’s telling, the idea was born over dinner at his Las Vegas hotel, where the waitress serving his table complained about the burden of paying taxes on her tips.“I was actually surprised to hear it,” Mr. Trump said last month at a rally in Virginia, adding that he quickly decided to address the waitress’s problem with a new campaign pledge: “No taxes on tips!”The proposal has rapidly become more than just a rally talking point. The Republican Party has officially embraced it in its platform, and House Speaker Mike Johnson, Republican of Louisiana, has said he would “pass it as soon as we can.” Some Democrats are also warming to making tipped income tax-free, with the two senators representing Nevada, a swing state with large restaurant and casino industries, endorsing it.The sudden popularity of exempting tips from taxes is a reminder of the improvisational nature of economic policymaking under Mr. Trump. Several economists involved in advising the Trump campaign said they hadn’t heard of the idea until Mr. Trump announced it publicly. But Republicans now see it as a key way to appeal to working-class Americans during the campaign against President Biden.Mr. Trump has encouraged his supporters to leave a note on restaurant tabs telling service staff that a Trump victory in November means no taxes on tips. Roughly four million Americans work in jobs where tips are common, according to an estimate by the Budget Lab at Yale.“It’s not like a gang of economists sitting around a table came up with that,” Stephen Moore, a Trump economic adviser, said. “I thought, ‘I don’t know if he’s being serious or not’, but as a political matter it’s a home run.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump-Vance Administration Could Herald New Era for Dollar

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    Both candidates on the Republican ticket have argued that the U.S. currency should be weaker to support American exports.Donald J. Trump’s selection of Ohio Senator J.D. Vance to be his vice-presidential nominee pairs him with a kindred spirit on trade, taxes and a tough stance on China. But it is their shared affinity for a weak dollar that could have the most sweeping implications for the United States and the global economy.In most cases, Mr. Trump likes his policies to be “strong,” but when it comes to the value of the dollar, he has long expressed a different view. Its strength, he has argued, has made it harder for American manufacturers to sell their products abroad to buyers that use weaker currencies. That’s because their money is worth so much less than the dollars that they need to make those purchases.“As your president, one would think that I would be thrilled with our very strong dollar,” Mr. Trump said in 2019, explaining that U.S. companies like Caterpillar and Boeing were struggling to compete. “I am not!”The dollar has been the world’s dominant currency since World War II, and central banks hold about 60 percent of their foreign exchange reserves in dollars, according to the Congressional Research Service.The United States has maintained a “strong dollar” policy since the 1990s, when Robert E. Rubin, the Treasury secretary at the time, declared that he did not view it as a threat to the ability of American business to compete abroad. The United States avoids taking measures to steer the strength of the dollar, and Treasury secretaries tend to argue that currency values should be determined by market forces. When countries, such as China, have acted to weaken their currencies, the U.S. has shamed them as currency manipulators.It is not clear how Mr. Trump would go about weakening the dollar. His Treasury Department could try to sell dollars to buy foreign currency or try to persuade the Federal Reserve to just print more dollars.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More