With Trump and Harris on the Ballot, Populist Economics Can’t Lose in November

J. D. Vance and Joe Biden may not agree on much, but the Republican vice-presidential candidate offered the Democratic president a bit of backhanded praise during last night’s first and only vice-presidential debate between the Ohio senator and Minnesota governor Tim Walz. 

“The one thing that Joe Biden did is he continued some of the Trump tariffs that protected American manufacturing jobs,” he told viewers. 

While Vance and Walz butted heads on issues like immigration and abortion, they projected a surprising degree of unity on economics and the plight of the working class, coming together to lament the commoditization of the housing market and the cost of raising children.

This cycle has seen a particularly broad scope of tax- and tariff-policy ideas from the GOP ticket: no taxes on tips, no taxes on overtime pay, a 10 percent temporary cap on credit-card interest rates, an expansion of the child tax credit, and, of course, a protectionist tariff of 10 or even 20 percent on all imported goods. The former president has even pledged that if elected, he will appoint a manufacturing ambassador to woo foreign companies to move production to the U.S.

Rather than sing the praises of free trade as did Republican nominees of years past, Trump and Vance favor what they call an America-first economic policy, often railing against globalization and the business interests that benefit from the cheap labor provided by illegal immigrants, while praising tariffs as a necessary tool to protect a group they often call the “forgotten men and women of America.”

“Strategically, what he’s begun to do is return to the economic policies of the late 19th century, which made America the most powerful, most rapidly growing country in the world,” former House speaker Newt Gingrich said in a brief interview with National Review on Friday following a celebration of the signing of the Contract with America 30 years ago. “His theory in part, I think, is that tariffs will generate enough revenue to offset all the stuff we’re talking about and to enable us to eliminate all these taxes.”

“So his argument is,” Gingrich continued, “rebuild American manufacturing, make foreigners pay more when they ship stuff to us, and take the money they give us and use it to cut taxes on Americans.”

In June, former President Donald Trump came to Capitol Hill for the first time in years to meet with congressional Republicans about the state of the election and his plans for a second term. One topic that particularly excited the former president, according to Republican lawmakers who attended, was a new policy idea he says he got from a waitress in Las Vegas — exempting tips from taxes.

Trump’s tax-free-tips proposal came across as a welcome, if not surprising, proposal to many congressional Republican senators who had never considered the idea. Yes, some Republicans immediately worried that the policy would be rife with unintended consequences. But others warmed to the idea. “If there was something we could do to really energize that particular segment of the population, that might be a real popular thing to do and a positive one in terms of the economy,” South Dakota senator Mike Rounds told reporters at the time.

Trump’s tax-free-tip proposal proved so politically potent that even Kamala Harris got behind it a few weeks later — a few days before announcing her own populist economic-policy platform, which includes pledges to expand the child tax credit, build 3 million new housing units, and grant a $25,000 tax credit to first-time homebuyers.

The Harris campaign is “doing this weird thing where anytime Trump throws out some policy that seems to poll well, they just kind of come out with their own version of that policy,” says Joshua Hendrickson, an associate professor of economics at the University of Mississippi.

Harris has reason to worry about her opponent’s working-class appeal. The GOP ticket has paired its reverence for industrial policy this cycle with a conspicuous appreciation for organized labor, including granting a GOP convention speaking slot to International Brotherhood of Teamsters President Sean O’Brien, and touting the former president’s majority polling support among the same union.

Trump’s populist approach to economics is a clear effort to tap into Americans’ “overall frustration” with the status quo, added Hendrickson. “Probably going back to the financial crisis, I think that there’s just been a lack of leadership, there’s been a lack of competence, frankly, from a lot of our institutions.” The former president is speaking to the concerns of people in the Midwest and the Rust Belt in a way that Democrats no longer do, he added.

While Trump certainly campaigned as a populist in 2016, building a coalition of disaffected, low-propensity voters, he largely governed as a traditional Republican.

To this day, many conservatives herald the Trump tax cuts — spearheaded by former Speaker Paul Ryan — as one of his administration’s greatest achievements. Many provisions of the Tax Cuts and Jobs Act of 2017 are set to expire in 2025, and Trump has pledged to work with Congress to reinstate them if he is elected to a second term.

However, he broke with the establishment wing of the party on tariffs. And, judging by his campaign rhetoric so far this cycle, he plans to double down on that protectionist streak if reelected. 

His across-the-board tariff proposal this cycle has drawn criticism from economists of all stripes as well as from traditional economic conservatives — including the NR editors — who say that these tariffs will raise prices for consumers. 

“I’m not a fan of tariffs,” outgoing Senate Minority Leader Mitch McConnell told reporters last month. “They raise the prices for American consumers. I’m more of a free-trade kind of Republican that remembers how many jobs are created by the exports that we engage in.”

The national electorate is pretty much split down the middle on tariffs, with the protectionist side enjoying a slight majority in a recent Reuters-Ipsos poll. But for the voters Trump brought into the Republican tent, any perceived effort to stop the bleeding caused by globalization is welcome, regardless of what it might do to the broader economy.

That’s why supporters of Trump’s protectionist approach to economic policy believe the pendulum is swinging in Trump’s favor. “You still have plenty of people who are skeptical of tariffs,” says Mark DiPlacido, a policy adviser at the Vance-aligned American Compass think tank. “But I would say the political momentum for making changes and adjustments, people are so much further along to being open to those adjustments now than they were eight years ago and I think that will continue.”

In another move unnerving to traditional conservative types, the Trump campaign altered this year’s Republican National Committee platform to include language pledging to protect Social Security and Medicare “with no cuts” and “no changes to the retirement age” — a clear indication the GOP nominee believes the long-time conservative commitment to entitlement reform is a thing of the past.

Trump has also sought to soften his image on abortion by pledging federal government support or insurance coverage for fertility treatments like in vitro fertilization, a move NR’s Phil Klein called an expansion of Obamacare.

The softer GOP messaging — on fertility and entitlements — hasn’t stopped Harris and Walz from leaning on perennial and misleading Democratic attack lines: Republicans want to rob you of your “reproductive freedom” and your government benefits. We’ll find out in November whether voters are buying it. 

Some Republicans, even those who disagree with the populist turn, are confident Trump can break through the Democratic messaging with all-important swing voters. 

“I like the tax cuts. I’m always in favor of those,” Club for Growth president David McIntosh told NR in an interview last week when asked about the Trump campaign’s tax-free-tips and overtime-pay proposals. “The other things — I think what he’s really trying to do is message to counter the Democrat attacks on social issues and abortion, and he’s saying, ‘We’re going to be reasonable.’”

Around NR

• Now that the Harris campaign has released an 82-page document outlining the vice president’s ideas on the economy, her policy proposals no longer suffer from a lack of detail, but they still suffer from a “lack of good sense,” NR’s editors write:

The Harris view of economics is that the United States is a single-player video game, and the federal government is the player. Creating a thriving economy is simply a matter of pressing the right buttons in the right order.

• Vance’s debate performance was a “strong asset to a GOP ticket whose chief advocate often veers off script and gets easily baited into tense exchanges,” says Audrey Fahlberg:

Before answering the first question about foreign policy, [Vance] made a clever point of introducing himself to swing voters and humbly asking for their vote, a clear attempt to soften his image to an on-the-fence electorate that has spent the past two and a half months watching his vice-presidential candidacy through the prism of an unsparing media.

• Vance “didn’t just win the debate with Tim Walz by being polished and unflappable,” NR’s editors write. “He won it on substance.”

Vance made as strong a case for Trump as could be made — a better one, in fact, than Trump typically makes for himself. Now we will go back to regularly scheduled programming.

• Trump has lost Omaha, Neb., and it could cost him, Jeffrey Blehar explains:

Nebraska’s second district (encompassing the Omaha metropolitan region on the eastern side of the state) looks to be as good as gone for Donald Trump, who narrowly won it in 2016 and who was handily beaten there in 2020. He now trails Harris 53–42 in this congressional district, and given 2020’s outcome, don’t bet on a miraculous polling miss to bail him out. (Nebraska, like Maine, allows its electoral votes to be apportioned per district, not simply awarded as a bloc to the statewide winner.)

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Correction: This article originally misstated which union president spoke at the GOP convention.