During last night’s debate, I expected no substance on the economy. I got none. When ABC’s David Muir asked Vice President Kamala Harris whether Americans are better off today than they were four years ago, she avoided the question, opting instead to share just a little word salad on social policy issues that she has been putting on the table since the convention.
Former president Donald Trump, as he would do for most of the evening, took the opportunity to hurl the red meat while failing to provide an answer to Mr. Muir’s question and also failing to provide at least a cogent outline on plans for the economy.
Prior to the debate, I took a quick look at the PredictIt markets. A Harris victory was priced at $.53 while a Trump win was priced at $.50. Right after the debate, the betting markets moved more in Harris’ favor with a win priced at $.57 while a Trump win was priced at $.47. At the time of this writing, a Harris win was priced at $.56.
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There was no discussion on how successful each candidate’s action plan could occur in a legislative environment created by a split Congress. Increasing expenditures on the military, childcare, infrastructure, or tax credits for first time house buyers will require congressional approval and that means that Ms. Harris or Mr. Trump will need a majority in both chambers to secure spending for their proposed policies.
Some commenters painted the debate as a way for more Americans to become acquainted with the Vice President, with the argument being that Americans were not very familiar with her even after almost four years as part of the Biden administration. I found that assessment puzzling, but I can see the plausibility when one accounts for the priority people place on political actors prior to elections.
My sense of Ms. Harris is that, given her immigrant background and her career as a prosecutor, Ms. Harris is not the radical left, progressive liberal the right tries to make her out to be. A good prosecutor may have a more balanced approach to law enforcement than most or a more expansive view on the application of law to their prosecutorial discretion, but they have little room for radicalism.
I get the sense that Ms. Harris, should she take the Oval Office, will govern more center-left than far left. If this is the case, traders should assess how a center-left approach will impact laws and regulations that dictate pricing in the bond markets, the supply of bonds, and Ms. Harris’ choice for a chairman of the Federal Reserve System.
Alton Drew
11 September 2024
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