US Election Scenarios: A Harris Victory

Welcome to the Audere Atlas, the Audere Group’s fortnightly update on global geopolitical trends, how we engage with them, and what they mean for your organisation.

With early voting underway in the 2024 US election, Americans across 50 states are already choosing between Donald Trump and Kamala Harris’ competing visions for the next five years. Having assessed that tariffs and tax cuts would characterise an administration led by the former, this week we guide you through the positive and negative implications of Harris’s proposed ‘New Way Forward for the Middle Class.’

The Audere Atlas offers timely, actionable insights that both support key decision-making and highlight areas for further exploration and understanding.

Democratic Succession

A Harris presidency would introduce a mixed bag for businesses with US interests: higher corporate taxes and stricter consumer regulations could challenge large corporations, while initiatives supporting middle-class stability, renewable energy, and healthcare affordability would offer new growth opportunities. Her focus on stable alliances

and centrist economic policies signals a predictable regulatory environment, potentially encouraging investments in emerging sectors like clean energy and tech startups, while giving large corporations reason to rethink their tax strategies and compliance models.

The Brief

Kamala Harris’s campaign reaches the final, crucial days of the 2024 US presidential race and the stakes could scarcely be higher. Razor-thin margins in key battleground states and the exceptional non-endorsement stances of major news outlets like The Washington Post and Los Angeles Times point to an extremely close outcome at the polls. For Harris, who has shaped her campaign around economic resilience, affordable healthcare, and sustainable job growth, winning in swing states means addressing the day-to-day realities of middle-class and working families. While Trump’s campaign rallies have seized headlines for their fiery rhetoric, amid her push to appeal to younger, more diverse voters, economic stability and a sense of shared prosperity have become core pillars of Harris’s platform, with particular attention to issues like income inequality and community investment.

The primary policy agendas of both candidates have largely been brushed over in mass media as the Presidential hopefuls publicly tussle over the touchy issues of abortion and immigration—as well as more niche issues relevant to the swing voters both candidates are so eager to win over. But the Harris/Waltz campaign published a detailed policy guide in September that gives a strong indication of where a future Democrat administration will stand on a range of issues. According to the 76-page ‘Plan to Lower Costs and Create an Opportunity Economy,’ published on 25 September, Kamala Harris’s campaign presents a ‘New Way Forward for the Middle Class.’ Harris has touted a centrist approach on the campaign trail, and her policy programme emphasises economic reform, strong international alliances, healthcare affordability, and climate action, aiming to provide a blend of progressive initiatives and pragmatic solutions.

Harris’s economic plan reflects her commitment to alleviating inflation, supporting first-time homebuyers, and reinforcing middle-class stability. Building on ‘Bidenomics,’ she proposes targeted tax credits, including those for parents of newborns and expanded Child and Earned Income Tax Credits, which collectively aim to provide over 100 million Americans with financial relief. Her approach also includes mortgage assistance for first-time homebuyers, addressing the challenges of high interest rates and rising housing costs. Harris’s stated dedication to ‘progressive taxation’ includes advocating for a corporate tax rate increase to 35%, surpassing Biden’s proposed 28%, yet she maintains a commitment to not raising taxes on individuals earning below $400,000, underscoring a focus on ‘equitable tax policies’ and ‘middle-class prosperity.’

If elected as America’s first female president, Harris also plans to reshape US economic leadership, adopting an approach distinct from both Biden and Trump. This means changes in personnel as well as policy, although, like Biden, Harris is not anticipated to appoint anyone with ties to the progressive left of her party into key economic positions. 43-year-old Wally Adeyemo is being peddled as a potential successor to his boss, Treasury Secretary Janet Yellen, who last month said she was ‘probably done’ with the role. Also in the running are National Economic Council Director Lae Brainard, Commerce Secretary Gina Raimondo, and White House Chief of Staff Jeff Zients. All have close relations with the private sector, and given a roster of confirmed and potential advisors ranging from billionaire Mark Cuban to BlackRock’s Mike Pyle and Uber’s Tony West, Harris is anticipated to go above and beyond Biden in terms of her willingness to engage business titans should she win office.

With strong ties to Silicon Valley and a focus on entrepreneurship, Harris’s presidency could significantly benefit startups and emerging industries, reinforcing her commitment to economic inclusivity. This approach aligns with her broader campaign themes of resilience, shared prosperity, and addressing the realities faced by middle-class and working families, ultimately shaping the future landscape for businesses across the country.

Harris’s foreign policy, emphasising strong international alliances and stable diplomacy while remaining attuned to humanitarian considerations, charts an altogether different path to Trump’s isolationist approach, although there is some alignment in their views on China. Consistent with the Biden administration’s coalition-focused strategy, at the Munich Security Conference in February 2024, Harris reinforced the US commitment to NATO and has pledged unwavering support for Ukraine amidst its ongoing conflict with Russia. On China, Harris advocates balanced competition and risk management, aiming to ‘de-risk’ rather than ‘decouple’ from the Chinese economy. Her administration would maintain, rather than raise tariffs, controlling exports of high-tech goods to China while supporting allies in the Indo-Pacific.

Climate is Harris’s most marked divergence from Trump. Her plan integrates the benefits of both renewable and traditional energy sources, aiming to achieve energy diversification without compromising environmental health. Originally a strong proponent of banning fracking, Harris has moderated her stance to support the Inflation Reduction Act, which allocates substantial investment in renewable energy but also permits fracking leases. Harris’s commitment to environmental stewardship extends to enforcing clean air and water standards and upholding stringent climate policies that began during her tenure as California’s attorney general. This approach marks a departure from Trump’s deregulatory energy agenda, as Harris focuses on developing sustainable energy infrastructure while balancing economic and environmental needs.

So What?

Kamala Harris’s policy platform introduces both opportunities and risks for businesses, with distinct impacts for firms of different sizes and operating in different sectors. If she prevails in November, her administration’s likely emphasis on ‘tax fairness,’ publicly funded infrastructure development, and workforce protections will introduce both challenges and opportunities for US businesses adapting to a new economic landscape.

A Harris victory, with a degree of continuity from the Biden administration, would likely result in less economic disruption in the short term compared to a second Trump administration (see last week’s Atlas report), which has pledged extensive tax cuts and significant tariffs on imports. But large businesses will likely feel the pinch in the medium term, experiencing increased tax burdens under the proposed corporate tax rate increase. Large corporations with US-focused investments may need to strategically adjust their tax planning as Harris’s administration prioritises higher corporate tax rates to finance middle-class support initiatives.

In the longer term, both SMEs and big businesses would nonetheless find opportunities under a Harris administration. Her focus on strategic, targeted economic policies has resonated across sectors, particularly areas where small businesses and local economies are eager for investment and stability. Simultaneously, her status-quo-oriented, centrist vision indicates a possible move toward policies that foster collaboration with corporate leaders, which could enhance business growth and innovation.

Harris’s strong connections to Silicon Valley, along with her focus on supporting entrepreneurship, could provide substantial advantages for startups and emerging sectors. This aligns with her broader commitment to economic inclusivity, addressing the everyday challenges faced by middle-class and working families, and ultimately influencing the future dynamics of the corporate landscape.

Her administration would likely create a more stable regulatory framework, reducing concerns about sudden policy changes and encouraging increased investment. Harris’s commitment to ban ‘price gouging’ at grocery stores and regulate consumer costs is exemplary of a policy agenda that could create additional compliance requirements, as the administration’s consumer protection agenda includes measures against ‘junk fees’ and price manipulation. Yet, while such regulation may limit certain revenue channels, businesses that demonstrate transparency and efficiency in pricing could gain consumer trust, a valuable asset in an increasingly regulated marketplace. Companies with clear, competitive pricing models will benefit.

Stability in foreign policy is also more likely under Harris than Trump, the growing pressures of an increasingly multipolar world notwithstanding. Her policies towards NATO, Ukraine, Israel, and the Indo-Pacific are known quantities, and despite a wary attitude towards China, unanticipated shocks to business are unlikely to result from her policies. Sectors reliant on Chinese manufacturing or market access, particularly high-tech and automotive industries, and US firms producing in China may be ineligible for new subsidies, but their position would be less precarious than under Trump, and they would be encouraged to see where the strategic wind is blowing to diversify. Harris’s dedication to strengthening NATO and supporting allies, including Ukraine, could equally lead to sustained demand for defence contractors and companies supplying military aid, opening additional opportunities in aerospace or cybersecurity.

Businesses positioned to adapt to or invest in renewable technologies may secure long-term advantages as Harris’s administration will likely promote energy innovation and environmental protection. Companies in oil and gas may face challenges as regulatory scrutiny on traditional energy sources increases, but renewable industries like solar, wind, and battery storage stand to benefit as Harris’s policies encourage growth in domestic renewable energy production, by prioritising clean energy investments, incentivising green infrastructure, and enhancing tax credits for renewable projects.

Companies in renewable energy, defence contracting, and consumer goods may thus see increased demand aligned with Harris’s priorities, while those in high-tax sectors or reliant on deregulation may experience operational pressures. The healthcare sector will also face challenges, as pharmaceutical companies experience tightened profit margins due to plans to expand Medicare price negotiations and cap prescription drug costs. However, healthcare providers and insurers focused on ACA-compliant plans could see benefits from her expanded ACA subsidy programme, increasing coverage accessibility and likely boosting market demand in the health insurance sector.

Keen to know more?

With the uncertainty of the outcome of the US election, with candidates offering such opposing agendas, businesses should prepare for shifts that could impact tax planning, regulatory compliance, and supply chains, remaining open to opportunities in new markets and sectors.

The Audere Group’s targeted services, from asset tracing and supply chain fraud detection to M&A intelligence and geopolitical analysis, equip companies to adapt seamlessly to evolving policies and capitalise on growth in new markets and sectors. Our risk assessments, enhanced due diligence, and strategic advisory ensure businesses can navigate change and make the most of emerging opportunities. Contact us to see how we can help your organisation stay competitive and compliant under a Harris administration.

Contact us to learn more about how our bespoke services can help you safeguard your interests and capitalise on new opportunities.

_{Disclaimer: The content of this report is for informational purposes only and does not constitute legal or financial advice. For further details or specific inquiries, please reach out to our team directly.}