Tuesday’s US election will hit the American economy on multiple levels. From how taxes are set to how the country does business, both candidates — Kamala Harris and Donald Trump — are rolling out radically different economic agendas.

Who wins the White House and which party takes control of Congress will shape everything from tax policies to the country’s stance on global trade, immigration and energy. Each move will ripple through consumers, affecting prices, borrowing costs and even the availability of jobs in key industries.

With both candidates poised to use executive power to boost trade and immigration, the outcome is about more than just who sits in the Oval Office. Congress will weigh heavily on tax policy, and it could make or break the next president’s agenda. Here’s what each candidate is proposing and what it means for the economy.

Taxes: Trump's Cuts vs. Harris' Targeted Increases

Trump has put tax cuts at the forefront. He is promising to extend his first-term tax cuts, which expire next year, and is eyeing even deeper reductions, especially for corporations. Trump is also pushing for tax cuts on tips, overtime pay and Social Security benefits.

To offset some of the lost revenue, Trump plans to impose new tariffs on imported goods. “Our focus is on keeping money in the hands of Americans,” Trump told supporters at a rally in Las Vegas.

Harris, by contrast, has a more restricted approach. She wants to keep the 2017 tax cuts, but only for those making less than $400,000. For the wealthiest Americans, Harris plans to raise taxes, specifically by increasing the corporate tax rate and imposing a minimum tax on billionaires.

She is also pushing for child tax credits and relief for small businesses. Harris’s proposals aim to shift tax benefits from corporations to middle-income families, her team said, positioning her tax policy as a “protection for working families.”

With the 2017 tax cuts set to expire next year, Congress will need to act quickly to avoid automatic tax increases for the middle class. A single-party victory in Congress would make it easier for either candidate to pass their tax plans. If Congress is divided, expect lengthy negotiations over any tax changes. Analysts see tax policy as the top item on the agenda in the upcoming session, regardless of who wins.

Trade: Trump's tariffs vs. Harris's continuity

Trump wants to double the tariffs, aiming to pressure manufacturers to bring production back to the US. He is eyeing tariffs of at least 10-20% on all imports and up to 60% on imports from China. This plan could force many US companies to rethink their supply chains, although the risks are high.

Bloomberg Economics estimates that an overall 20% tariff could cut U.S. GDP by 0.8% and push inflation up to 4.3% by 2028 if only China retaliates. If other countries retaliate as well, GDP could fall by 1.3%, though inflation could stabilize due to reduced economic demand.

Harris, on the other hand, signals continuity with the Biden administration’s trade stance. She warned that Trump’s plan would act as a “national sales tax” that would hit consumers hard. Both Trump and Harris say they will block Japan’s bid to acquire U.S. Steel Corp., showing rare agreement on opposing foreign investment in critical industries.

The president has significant power to take direct action on trade, meaning rapid changes can be expected depending on the winner.

Immigration and Labor: Hardline vs. Pragmatic Approach

Immigration policy will see a drastic change depending on the outcome of the election. Trump is promising a massive crackdown on undocumented immigrants, which would be one of the largest deportation efforts in U.S. history.

Industries such as construction, hospitality and retail that rely on immigrant labor would be hit hard. Economists predict the measure could disrupt business operations and cost billions to implement.

Harris offers a more pragmatic approach. She wants to reintroduce legislation to address illegal border crossings, a step she will need bipartisan support to achieve if Congress is divided.

His stance stands in stark contrast to Trump’s hardline approach, which focuses on balancing border security with immigrant labor needs. Presidents wield broad powers over immigration policy, so changes here could happen quickly after the election.

Energy: Fossil Fuels vs. Clean Energy Transition

Trump’s energy agenda revolves around fossil fuels. He is taking a “drill, baby, drill” stance, promising to ease regulations on oil, gas and coal production. He wants more federal lands open to drilling, arguing that doing so will lower energy prices.

The Trump team says these measures will combat rising costs by expanding domestic energy supplies and creating jobs in traditional energy sectors.

Harris, meanwhile, is leaning toward clean energy. Her plan focuses on reducing household energy costs while addressing climate change. She is committed to funding clean energy projects and protecting public lands from fossil fuel development.

Harris' approach reflects her agenda to address the climate crisis, although her focus on renewable energy could reshape energy markets and jobs.

Deficit impact: Which candidate's plans increase debt?

Both candidates would increase the deficit, but Trump’s plans would add nearly twice as much. The Committee for a Responsible Federal Budget, a nonpartisan watchdog, estimates that Trump’s proposals would increase the deficit by $7.75 trillion over the next decade.

Harris estimates the deficit at $3.95 trillion, still significant but much lower than Trump’s. Larger deficits typically lead to higher interest rates, impacting borrowing costs for households and businesses.

Investors are cautiously optimistic despite rising deficits, with demand for Treasuries steady even as the U.S. deficit rose to $1.83 trillion at the end of September. U.S. debt is already approaching 99% of GDP, and Bloomberg Economics predicts Trump’s tax cuts could push it to 116% by 2028.

Harris' proposals are more conservative, but still foresee an increase to 109% of GDP. A divided government could slow deficit growth, as any major tax or spending move would require cross-party support.

Tuesday’s election will set the course for U.S. taxes, trade, immigration and energy. Both candidates bring sharp contrasts on their policies, but the final outcome will depend not only on the presidential vote but also on control of Congress. The next steps in U.S. economic policy are anyone’s guess, but all signs point to big changes ahead.

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