While there is no single “Democratic plan,” the party’s economic platform is based on the philosophy of “Bidenomics” and “middle-out, bottom-up” growth, building on legislation passed during President Biden’s first term. The platform focuses on targeted tax reform, strategic investments, lower costs for families, and strengthening labor and worker protections. 

Tax policy and fiscal responsibility

Democrats advocate for tax reforms designed to reduce the burden on middle- and lower-income families while increasing taxes on corporations and high-net-worth individuals. 

• Ending tax breaks for the wealthy: Proposals include a minimum 25% tax on the wealthiest Americans, ending preferential rates for investment income, and closing loopholes for private equity and real estate.
• Increasing the corporate tax rate: President Biden’s 2025 budget repeated the call for raising the corporate tax rate from 21% to 28% to help fund investments and deficit reduction.
• Expanding credits for families: Democrats seek to restore and expand key provisions that expired in 2021, such as the Child Tax Credit and the Earned Income Tax Credit, to provide financial relief to working families. 

Key investments in the US economy

Building on landmark legislation like the Infrastructure Investment and Jobs Act (2021), the CHIPS and Science Act (2022), and the Inflation Reduction Act (2022), Democrats propose continued strategic investments. 

• Infrastructure: Continued investments in roads, bridges, public transit, broadband internet, and clean water systems are designed to modernize the nation’s infrastructure and create jobs.
• Domestic manufacturing: Incentives support the growth of domestic industries, particularly for semiconductors and clean energy technology, to strengthen supply chains and decrease reliance on foreign production.
• Clean energy: Investments in wind, solar, and other renewable energy sources aim to combat climate change, create jobs, and lower long-term energy costs for consumers. 

Lowering costs for American families

Another key aspect of the Democratic plan is lowering everyday costs for consumers, which proponents argue has been negatively impacted by corporate price-gouging and inflation. 

• Healthcare: Democrats aim to lower healthcare costs by strengthening the Affordable Care Act (ACA), expanding premium subsidies, capping prescription drug prices, and allowing Medicare to negotiate more drug prices.
• Housing: A focus on housing affordability includes investments in building and rehabilitating affordable housing, reforming zoning laws, and providing rental assistance.
• Childcare: The plan includes measures to expand access to high-quality, affordable childcare and universal pre-kindergarten. 

Strengthening the workforce and supporting small businesses

Democrats advocate for policies that empower workers and foster small business growth, which they see as the engine of the economy. 

• Workers’ rights: The platform supports strengthening unions, protecting workers’ rights to organize, and increasing the federal minimum wage.
• Paid leave: A national paid family and medical leave program is proposed to support workers and increase labor force participation.
• Small business support: The plan includes expanding access to capital and federal contracts for small businesses, especially those in underserved communities. 

The Economic Legacy of the Biden Years, and the Path Forward

While I consider myself a conservative, and as a result, I don’t have much confidence in the Democrats’ plan for our economic future, in an effort to maintain parity, I will devote a chapter to this subject.

When President Biden took office three and a half years ago, old ways of thinking about the economy were already falling out of favor—among academics, organizers, and the American public. Market fundamentalism just wasn’t working. After the Great Recession and a subsequent decade of slow economic growth, and at the height of a devastating pandemic, trickle-down economics had zero credibility and fewer fans by the day. But even from our front-row seat in these developments, we at the Roosevelt Institute couldn’t have predicted how quickly the Biden administration would turn these intellectual and cultural shifts into historic legislation and policy change.

On the heels of President Biden’s withdrawal from the presidential race this past weekend, it’s a good time to reflect on how those wins have actualized a once-in-a-generation economic paradigm change—reclaiming the importance of governance, and marshaling the power and investments of government to shape markets in service of American workers and families. We know now what we didn’t know before: that markets aren’t an end in themselves, and that economic power tends to concentrate if left unchecked. This is why we need more muscular government power.

We have seen remarkable successes in the past three-plus years. And it’s imperative that we continue to chart a clear path forward.

A Record-Fast Recovery and a Worker-Centered Economy

Joe Biden’s presidency is one of the most worker-centered since the Roosevelt administration, as the American Rescue Plan (ARP) proved early on. 

In the first few months of the administration, policymakers heeded the lessons of the decade prior and chose a different course: a historically large recovery package that prioritized full employment and put money in people’s pockets. 

The results speak for themselves: In 2021 alone, nearly seven million jobs were created, four million of which were attributable to the passage of the ARP—making it one of the most effective pieces of economic recovery legislation in the last 50 years. 

In the years since, unemployment fell to its lowest level since 1969, and remained below 4 percent for a historic 30 months. The long-standing employment gap between Black and white workers has shrunk, and average real wages—that is, wages adjusted for inflation—are higher now than when the pandemic began and currently rising faster than inflation. Real US economic growth, meanwhile, nearly doubled, reaching 5.7 percent in 2024—one of the strongest years on record. 

The hot economy of recent years has provided an opportunity for more workers to reclaim power and collectively renegotiate the terms of their work. And it’s been bolstered both tangibly and symbolically by the most pro-labor administration we’ve seen in decades. A more assertive National Labor Relations Board has strengthened workers’ hand, and last year Biden became the first president to walk a picket line. Overall support for labor unions is at a level not seen since the 1960s.

A Government That Invests in Its People and Future

From combating the pandemic and climate crisis to bolstering domestic supply chains, the Biden administration has deployed long-neglected government tools to address some of today’s biggest challenges and opportunities. In the last three years, we have invested in green industries and physical infrastructure—through landmark legislation like the CHIPS and Science Act, Inflation Reduction Act, and Infrastructure Investment and Jobs Act—to bolster our shared security and take a major step in reaching our nation’s climate goals. 

Over the next decade, these massive investments will transform the communities hardest hit by trickle-down economics, and could mark a more enduring shift in the nation’s approach to climate and industrial policy. The IRA’s investments alone are expected to create more than 100,000 jobs, which the administration has pushed to ensure go to the people who need them most and maintain high standards of pay and safety. 

The historic public investments of these laws have also spurred a boom in private spending, with manufacturing construction spending tripling since 2021. 

How Democratic Policies Fuel Economic Growth

The data shows that the U.S. economy consistently performs better under Democratic leadership. From stock market growth to trade policies and poverty reduction, Democratic administrations have historically fostered a stronger and more sustainable economy. Let’s break down the key trends from the past 25 years. I’ve provided links from bi-partisan sources to support the facts.

Myth 1: Stock Markets and Corporate Profits Perform Better Under Republicans

WRONG. Stock markets and corporate profits thrive under Democratic leadership.

Despite fears that labor-friendly policies stifle growth, the numbers tell a different story. Under President Obama, the S&P 500 surged by 181%, driven by a steady recovery from the Great Recession. In comparison, the S&P 500 dropped 37% during George W. Bush’s presidency, culminating in the 2008 financial crisis.

Across 25 years, Democratic administrations have outpaced Republicans in stock market performance, with the S&P 500 averaging 10-15% annual growth under Democrats versus 6-10% under Republicans. Corporate profits have similarly thrived, growing at an annualized rate of 12.8% under Democrats compared to just 1.8% under Republicans. This performance reflects how Democratic policies, emphasizing investment in infrastructure, education, and workforce development, support long-term profitability.

Myth 2: Trade Wars Protect American Jobs and Strengthen the Economy

WRONG. Trade wars destabilize markets, while Democratic trade policies create sustainable growth.

The trade wars initiated under the Trump administration disrupted global supply chains, increased production costs, and slowed U.S. economic growth by 0.3-0.5 percentage points annually. Trump’s tariffs on imports, especially from China, backfired, raising consumer prices and harming industries like agriculture and manufacturing. In fact, Trump’s proposals, including across-the-board tariffs and deporting workers, are seen as potentially inflationary, according to the Wall Street Journal.

In contrast, Democratic-led trade policies—like Obama’s Trans-Pacific Partnership (TPP)—reduce trade barriers, stabilize markets, and promote labor and environmental standards. These policies support both large and small businesses by expanding market access and lowering production costs.

The only time there are dips in economic growth are under Republican leadership.

Myth 3: Democratic Policies Increase Poverty

WRONG. Democratic policies reduce poverty and foster economic mobility.

Contrary to popular belief, poverty rates decline more consistently under Democratic administrations. For example, during Obama’s tenure, the poverty rate fell from 13.2% to 12.7% by 2016, despite recovering from the Great Recession. Programs like the Affordable Care Act (ACA) expanded healthcare access, alleviating financial burdens for millions of families.

The pattern shown in U.S. poverty rates over the past 25 years suggests that poverty tends to rise during Republican administrations (pink), often coinciding with recessions or economic disruptions, while it declines under Democratic leadership (blue) as economic recovery and social policies take effect. For instance, under George W. Bush, poverty peaked following the 2008 financial crisis, while Barack Obama’s administration brought it down through targeted programs. Similarly, the poverty rate has declined under Joe Biden as the economy recovered from the COVID-19 pandemic. Democratic administrations have historically implemented policies that foster economic stability and reduce inequality, benefiting lower-income households.

Democratic investments in food assistance, child tax credits, and job training enhance purchasing power and reduce inequality. These policies contribute to workforce stability and productivity, ensuring that businesses benefit from a healthier, more engaged workforce.

Democrats aim to increase Child and Dependent Care Tax Credit 

The Democratic Platform proposes “significantly increasing” the Child and Dependent Care Tax Credit (CTC), but lists no specific number. The child tax credit is a nonrefundable tax credit available to taxpayers with dependent children under the age of 17, for 2024 the child tax credit will be worth $2,000 per qualifying dependent child. 

Progressive Caucus Chair and Washington U.S. Rep. Pramila Jayapal said at a panel on care at the DNC the CTC “cut childhood poverty in half.” 

The 2021 one-year expansion of the CTC dropped the U.S. child poverty rate from 9.7% to 5.2%. After the expansion ended, the rate shot up to 12.4% in 2022.

Efforts to preserve it faced unified opposition from Republicans as well as West Virginia Democratic U.S. Sen. Joe Manchin. Critics called the monthly payments an expensive welfare scheme that would deter parents from working.

The CTC was referenced in similar panels about poverty and housing and also by speakers during the DNC primetime on Tuesday night. Vermont U.S. Sen. Bernie Sanders re-upped the tax break that nearly cut childhood poverty in half. 

Family benefits and care

The U.S. is the only high-income country that does not have mandatory paid parental leave or any national family caregiving or medical leave policy. The Democratic platform proposes “at least 12 weeks of paid family and medical leave for all workers and family units.” The platform also advocates for universal pre-K programs. 

Minnesota Gov. Tim Walz, the party’s vice presidential nominee, signed a paid family and medical leave program into law in 2023 to give workers in his state up to 20 weeks off, with benefits scheduled to start in January 2026.

California U.S. Rep. Jimmy Gomez also spoke at a panel focused on paid leave and child care. Gomez, who founded the Congressional Dads Caucus, spoke on the three pillars of the caucus: national paid family leave, enhanced CTC and accessible child care.

Other speakers included actress and comedian Cristela Alonzo, Michigan U.S. Rep. Debbie Dingell and Massachusetts U.S. Rep. Ayanna Pressley all telling personal stories of navigating the health care system with family members. 

“You don’t know how broken the current system is until you suddenly find yourself in it,” Dingell told the room, speaking of her late husband who died of cancer in 2019. 

Dingell co-authored the Medicare for All Act of 2023 alongside Jayapal and Sanders. 

Democrats voice concern why millions combat poverty 

Numerous speakers before the Poverty Council voiced a common grievance: as the richest country in history, why do millions of Americans still live in poverty? 

“You ought to be pissed off about the poverty in this rich country,” California U.S. Rep. Maxine Waters said. “In this country, over 653,000 people sleep on the streets every night, So housing is very important for us to talk about in terms of poverty.”

Waters blamed large corporations and private equity companies for using price setting tools to jack up rents. 

The U.S. Department of Justice recently recommended a civil lawsuit against RealPage Inc., a software company used by landlords across the country. The suit would accuse the company of selling software that enables landlords to illegally share confidential pricing information to collude on setting rents. 

Vice President Kamala Harris called on Congress to pass the “Stop Predatory Investing Act” sponsored by Wisconsin U.S. Sen. Tammy Baldwin, among other Democratic senators. The bill would prohibit investors with 50 or more single-family rental homes from deducting interest or depreciation on those properties. 

In Milwaukee, the share of rented houses owned by an out-of-state landlord grew from about 5% in 2005 to 18% in 2022. Out-of-state ownership is more prevalent in predominantly Black wards, accounting for 24% of rental properties. 

‘Right to Work’ laws could be repealed 

The party platform proposes a federal minimum wage of $15 per hour by 2026, passing The Protecting the Right to Organize (PRO) Act, a piece of union-boosting legislation, and strengthening whistleblower and anti-retaliation protection. 

The PRO Act would effectively repeal state level “Right to Work” (RTW) laws; 27 states have passed RTW laws that make it optional for employees in unionized workplaces to join a labor union or to pay union dues or other membership fees required for union representation. Wisconsin became a RTW state under former Gov. Scott Walker in 2015. 

States with RTW laws have lower unionization rates, wages and benefits compared with non-RTW states. On average, workers in RTW states are paid 3.2% less than workers with similar characteristics in non-RTW states, according to the Economic Policy Institute, an independent, nonprofit think tank. 

International trade policy remains vague, low-income Americans at risk of high tariffs 

The party plans on negotiating standards for labor, human rights and the environment in trade deals like the pro-labor provisions added to the United States-Mexico-Canada Agreement passed in 2020. The platform doesn’t explicitly state if the party will pursue changing tariff policy to accomplish these goals. 

The platform further stated the party would “take aggressive action against China or any other country that tries to undercut American manufacturing,” but did not go into specifics.

A potential Harris administration may choose to continue the steel and aluminum tariffs that President Joe Biden increased from 0–7.5% to 25% in 2024. Some economists estimated in 2020 steel tariffs may have led to an increase of roughly 1,000 jobs in steel production. But increased costs of inputs facing U.S. firms likely resulted in 75,000 fewer manufacturing jobs in steel or aluminum-related industries.

Former president and current Republican nominee Donald Trump floated the idea of a 10 to 20% “across-the-board” tariff on all imported goods in a visit to North Carolina. A 10% percent tariff would effectively act as a tax on U.S. consumers impacting low-income Americans, who spend a larger portion of their income on consumer goods, disproportionately more. A typical middle-class household in the U.S. would face an estimated $1,700 a year in additional costs, according to the nonpartisan Peterson Institute for International Economics. 

We Are Better Off TODAY Than We Were Under Trump

Today’s economic indicators tell a clear story:

• Unemployment stands at 3.8%, far below the peak of 14.7% during the COVID-19 crisis under Trump.
• Inflation is stabilizing, easing pressure on businesses and consumers alike.
• Consumer confidence and spending are rebounding, driving economic momentum.
• Worker productivity is up, and corporate profits remain robust, signaling a competitive, thriving economy.

What Comes Next

Beyond maximizing the potential of what’s been passed, we have the opportunity and obligation to think bigger in the coming years: to increase economic security for all Americans and make our economy and democracy both stronger and fairer.

Next year’s expiration of Tax Cuts and Jobs Act provisions offers the chance to rethink our tax code and ensure the wealthy and corporations pay their fair share. It would both make our economy more productive, and create more revenue to invest in what Americans want and need: from universal childcare and pre-K to free college and affordable housing. 

After decades of filibuster-blocked legislation for workers and families, and with a Supreme Court that has undermined women’s right to choose and government’s ability to govern, democratic reform must also be a top priority. President Biden’s recent proposals to create Court term limits and an ethics code are an essential start. 

Conclusion

The future is sensationally unpredictable, but one thing is certain: Powerful actors will continue to fight hard to keep the embers of trickle-down thinking alive. But the progressive policies enacted throughout the Biden administration have ensured that more people have better jobs and have shown what government is capable of. These achievements represent the work of countless progressive thinkers and advocates, pushing an administration that knew that market supremacy couldn’t deliver what it promised.

We have seen that with the right rules, our democracy can become more equal and more inclusive, less beholden to corporations and wealthy individuals, and more responsive to the public. Now, the hard work of fighting for a new, more democratic economy must continue.

The facts prove it—workers, businesses, and the economy perform better under Democratic leadership. Policies prioritizing healthcare, education, and fair wages drive workforce productivity and create conditions for sustainable business growth. Businesses, in turn, benefit from increased consumer demand and stable market environments.

This election offers a critical choice: continue on a path of sustainable economic progress or risk reversing these gains. Democratic policies foster long-term stability and growth, benefiting both workers and businesses.

When you cast your vote, choose policies that support both people AND profits. Vote for sustainable growth. Vote for a future where companies succeed because workers thrive. Vote for progress.