During the first townhall of the 2020 presidential season, Sen. Kamala Harris spoke extensively on questions of morality and social justice, but was a little light on policy details. Here’s a look at some of her points and claims and where they fit in the broader context.
Minimum wage and housing
The senator was asked Monday night whether she thought “the existence of multi-billionaires is morally defensible” when “nearly 1 in 5 children live in poverty.”
Harris focused her answer on attacking the recent tax bill passed under President Donald Trump, mentioning her own tax proposal, and implying that the minimum wage is too low.
“In 99% of the counties in America,” she said, “if you are a minimum wage worker working full time you cannot afford market rate for a one-bedroom apartment.”
The senator made a similar claim last July on Twitter, and when asked by PolitiFact what source she was pulling from, her press secretary provided a study from the National Low Income Housing Coalition, a group focused on increasing and preserving low income housing. The 2018 update of the study – with a preface from Sen. Bernie Sanders – claims that in less than 1% of counties “can a full-time minimum wage worker afford a one-bedroom rental home at fair market rent.”
It’s difficult to parse through such a statement when words like “afford” and terms such as “fair market rent” are not clearly defined. The NLIHC study defines “affordability” as a household spending “no more than 30% of [its] gross income on rent and utilities.” Fair market rent (FMR) is set at the 40th percentile of the typical, rentable property. In other words, if a certain market has five rentals available at $300, $400, $450, $500 and $550, the FMR would be set at $400, which is the 40th percentile. The FMR is calculated by the Department of Housing and Urban Development.
Essentially, this part of the study claims that 60% of all the available one-bedroom units to rent in 99% of all counties would require more than 30% of a full-time minimum wage worker’s income. As always, the more local you can get with data (comparing state minimum wage, city minimum wage, and county to county in a particular state) the clearer the picture becomes.
With her answer, Harris touched on two of the key issues behind poverty and social justice that progressives and Democrats will likely address in the 2020 campaign season: that housing shortages coupled with relatively stagnant wages – particularly at the lower end of the income bracket – have created a situation where even people who work full time are unable to afford a decent place to live in their current place of residence.
Ultimately an increase in the federal minimum wage – even to Sanders’ desired $15 – is not enough to fix the housing problem in places like California and Seattle, as the study notes. For instance, in California, a two-bedroom apartment at FMR would require a minimum salary of $32.68 an hour. One of the biggest problems, according to the study, is a clear lack of housing to meet the demand in these areas.
Harris also discussed her LIFT tax credit proposal to address poverty.
LIFT the Middle Class Act
When asked what she would first work to accomplish as President, Harris quickly pointed to her proposed middle-class tax cut, the LIFT Act. The proposal, unlike some coming from her Democratic colleagues, sets Harris on a more centrist path on the issue of taxes.
Earlier during the townhall, Harris elaborated on the proposal. “What we would do is, for families who are making less than $100,000 a year, they would receive a $6,000 tax credit that they could receive $500 a month,” Harris said, suggesting that an extra $500 dollars for many could prevent financial disaster.
As CNN previously reported, the proposed legislation would give married couples earning up to $60,000 a year a $6,000 refundable tax credit. She’s proposing a $3,000 credit to single filers making up to $30,000 and single parents who earn up to $80,000. Couples and single parents with earnings of more than $100,000 and single filers making more than $50,000 would no longer be eligible.
Harris’ proposed tax plan, as CNN has noted, sets itself apart from many other tax credits by allowing eligible tax payers to receive their credit on a monthly basis rather than in a lump sum at the end of the year.
The non-partisan Tax Policy Center found that the LIFT Act would cost $3 trillion over the next 10 years. But the question of “how do we pay for it?” didn’t stop the Trump tax cuts, so it’s unlikely that this would be the LIFT Act’s biggest hurdle.
Harris’s communications director, Lily Adams, told CNN that Harris also supports raising taxes on the top 1%, but Harris hasn’t said how much the increase would be.
By focusing on a middle-class tax cut, Harris stakes out ground closer to the center than other Democratic hopefuls. Bernie Sanders continues to promote a tax plan that would take in an estimated $15.3 trillion over 10 years while Elizabeth Warren has proposed a 2% tax on the assets of those whose net worth is above $50 million (with a 1% levy on billionaires sprinkled on top). That’s to say nothing of New York Rep. Alexandria Ocasio-Cortez’s recent suggestion of putting rates as high as 70% on any earnings above a $10 million mark, as part of her Green New Deal.
But Harris, by proposing a tax cut for the middle class and not providing a specific plan on increasing taxes on the uber wealthy, is giving voters a more centrist option. We’ll see if it holds.