On her way to the Democratic National Convention in Chicago, Vice President Kamala Harris stopped in Moon Township, Pa. to talk, among other things, about her plan to revive and expand the child-tax credit for the first year’s of a child’s life. How would she pay for the $6,000 credit, a reporter asked.
The Biden-Harris administration’s smaller child tax credits, since discontinued, were credited with cutting child poverty rates by half.
“The return on that investment in terms of what that will do and what it will pay for, will be tremendous,” Harris said.
Harris uses the same language of business to talk about other social priorities. Homeownership, for example, increases the tax base to provide vital funding for schools and other local priorities. Her focus on measurement and returns may have resonance for impact investors, many of whom are investing behind the same themes.
“It’s a mistake for any person who talks about public policy to not critically evaluate how you measure the return on investment when you are strengthening neighborhoods, strengthening communities, and investing in a broad-based economy,” she said. “Everybody benefits, and it pays for itself in that way.”
Bottom up, middle out
Harris has sought to refresh and relaunch the message of bottom-up, middle-out prosperity at the core of Bidenomics. Her current boss, President Biden, struggled to get credit for the rising wages, record new-business starts and surge of investment in domestic manufacturing and green infrastructure on his watch.
“It’s no surprise it’s going to take a woman to bring nurturing and equitable policies and support the middle class,” said KeepWol’s Lauren Fitzpatrick Shanka, the creator of Black Women and Allies in Tech 4 Kamala. Shanka spoke on Sunday’s “Black Women and Allies in Tech 4 Harris” call, where hundreds of venture capitalists, entrepreneurs and other technologists made the case for Harris’s inclusive leadership (for context, see “VCs embrace Kamala Harris’s vision for an economy that works for all”).
Harris’s vision of an “opportunity economy,” with a focus on support for families, building the middle class and holding corporations accountable, resonated on the call, reports ImpactAlpha’s Sherrell Dorsey, who also spoke on the call. Dorsey was in Raleigh, NC for Harris’s economic speech on Friday and is in Chicago this week for the Democratic National Convention.
Such public investments create economic tailwinds favorable for private investments as well. Shila Nieves Burney of Atlanta-based Zane Venture Fund is investing in “industries her plan will prioritize: housing inclusion, food, financial security, and health care,” she wrote on LinkedIn. “We all deserve a healthy human economy,” she said. and that Harris’s ‘opportunity economy’ “should provide a pathway to solving this.”
Local revival
Entrepreneurial ecosystems. Access to capital. Small-business support. Manufacturing investments. Workforce training. The menu of successful solutions is not that different for “blue” urban areas and “red” rural regions.
About 30% of the US electorate is poor or low-income. In so-called battleground states, that number rises to 40%.
The Harris-Walz ticket “is a fusion ticket that could unite the poor and low-wage Southern Black Belt and the rural white Midwest,” says the Rev. Dr. William Barber II of Poor People’s Campaign. In North Carolina, Barber’s “Moral Mondays” rallies in Raleigh have brought together people across race, class and issue areas.
It may not be centrist voters, but the 135 million poor and low-income Americans that will swing the election, says Barber. “Politicians who embrace the language of fusion movements for economic justice have the power to both tap into the moral concerns that drive millions of Americans and multiply the energy of grassroots organizing,” he writes with his Yale colleague Jonathan Wilson-Hartgrove.
From lifting the living wage and protecting workers’ right to organize, to increasing the child credit and expanding access to affordable healthcare, the Harris-Walz campaign has “tapped the energy of worker-driven movements that want to create an economy that works for all of us,” they say.
“Black, white and brown workers have challenged the politics of division while also refusing the typical framing of left versus right and liberal versus conservative.”
Green gains
Pennsylvania may be in mind in Harris’s walkback on her earlier position opposing fracking. But polling suggests that two crucial groups – young voters and Latinos – increasingly prioritize positive climate action. Harris’s campaign has so far soft-pedaled climate action, but convention speakers are expected to hit themes of a just-transition and green jobs.
Such tangible economic gains – for all – may be as important as the greenhouse gas reductions, at least politically. Harris’s climate strategy taking shape builds on the Biden-Harris administration’s climate commitment to cutting US greenhouse gas emissions by more than half from 2005 levels by 2030.
“The IRA is the most significant piece of climate legislation in history,” said Mandela Barnes, who leads Forward Together Wisconsin, a nonprofit focused on bridging local organizations with federal infrastructure dollars.
“But we still have to close the equity gap. We have been waiting on a moment like this to see what the challenges are in implementing federal dollars on sustainability,” he said Monday. Barnes, a former lieutenant governor of Wisconsin and chair of a state task force on climate change, added he’s been providing feedback to the administration on “how we make things more equitable and make Justice40 work.”
It was Harris who in 2022 cast the tie breaking vote that pushed the IRA forward. The legislation could create more than nine million green jobs over the next decade —an average of nearly one million jobs per year, according to an analysis by the BlueGreen Alliance. “When the president and I invest in climate, we intend to invest in jobs,” Harris said last July.
The IRA is already spurring a boom in manufacturing investments to onshore critical green technologies. The sprawling law has provisions to accelerate the shift to lower-cost renewable energy, reduce the costs for prescription drugs and lower the cost of housing. The IRA, passed two years ago, is expected to save Americans up to $38 billion on electricity costs by 2030.
The prospect of federal incentives has already sparked some 646 clean energy projects that could create 334,565 new jobs, and mobilized nearly $500 billion in private investment for clean manufacturing, and battery, chip, EV and solar manufacturing plants.
Those jobs have political appeal, even in red states. Earlier this month, a group of 18 Republican House representatives urged Speaker Mike Johnson not to repeal the IRA’s tax credits, which have financed clean power and manufacturing plants in their districts.
“Energy tax credits have spurred innovation, incentivized investment, and created good jobs in
many parts of the country – including many districts represented by members of our conference,” they wrote in a letter.
Similarly, some 3.4 million households claimed $8.4 billion in IRA tax credits last year to buy solar panels, heat pumps, induction stoves, EVs and other green upgrades. Among the top states: Florida, Pennsylvania and Texas.
Home ownership
Harris has reached out to the middle class to let them know that she grew up as one of them. Few things are more middle class than home ownership. Harris last week shared plans that include $25,000 in down-payment assistance for “eligible” first-time homebuyers.
“My mother saved well over a decade to buy a home,” she said at a rally in Raleigh, NC on Friday. “I was a teenager when that day finally came and I can remember so well how excited she was.”
Surging rents and home prices burdens more than 40 million renters and homeowners in the US in housing costs. In March, President Biden called on Congress to pass a mortgage relief credit that would provide middle-class first-time homebuyers with an annual tax credit of up to $5,000.
Harris’s plan also seeks to expand the supply of affordable housing and is calling for the construction of 3 million new housing units by the end of her first term. Incentives include tax credits for developers of new affordable rental housing development and new affordable single-family homes for first-time home buyers.
The housing incentives respond to “the harsh realities facing today’s housing market for many low- to middle-class Americans,” says Tai Christensen of Arrive Home, a national social enterprise that provides down-payment assistance and alternative credit support to first-time homebuyers, with a focus on underserved communities of color. “With home prices remaining and inventory limited, first-time homebuyers are struggling to get a foothold on the property ladder.”
Innovative financing solutions for first-time homebuyers that are coming to market could help bridge the Black-white homeownership gap that has crippled inclusive wealth growth and exacerbated racial wealth gaps.
Ownify, based in Raleigh, NC, is looking to replace predatory rent-to-own models with a fractional ownership strategy that covers all upfront costs for first-time low-income and minority homebuyers. Homeowners have the opportunity to buy into the home’s equity, brick-by-brick, via fixed monthly payments over five or 10 years or longer. “This is a way that first-time homebuyers can purchase a home in a way that’s more affordable and also more accessible,” Ownify’s Allie O’Shea told ImpactAlpha.
New York-based Homium, through its “shared-appreciation notes,” is helping low- and middle-income first-time buyers secure down-payment assistance in exchange for a cut of their home equity appreciation (see, “Homium aims to help home buyers overcome the down-payment hurdle”).
In Denver, the Dearfield Fund for Black Wealth in Denver provides interest-free down-payment assistance loans to local Black families to purchase their first homes. The place-based impact fund is centering Black women first-time homebuyers who are leading their households (see, “How Dearfield Fund helps Black women buy homes to build wealth and health”).
