President Joe Biden and former President Donald Trump are expected to spar over economics as they outline their starkly contrasting policy visions for the country during the first presidential debate.
The Thursday showdown, the first of two scheduled so far, will feature Biden and Trump squaring off and will be moderated by CNN. The debate itself has ground rules that deviate from previous election cycles. For instance, there will be no in-person audience, and the candidates’ microphones will only be turned on when it is their turn to speak.
Candidates won’t be able to get real-time assistance during the 90-minute debate, either. While there will be two commercial breaks, neither Biden nor Trump are allowed to interact with campaign staff during that time.
Expect several questions about the economy. Too-high inflation has been plaguing the country since just after Biden was sworn in and has quickly become the No. 1 problem on voters’ minds. Republicans have used voter discontent with the economy as a cudgel against Biden and Democrats, so it is likely that the two presumptive nominees will spar over economic matters throughout the matchup.
Inflation
Inflation is far and away Biden’s biggest economic headache. The Federal Reserve considers healthy inflation to be about 2% annual growth, but as of now, annual inflation is running at 3.3%, according to the consumer price index. That is notably above the Fed’s target, but is well below its peak of about 9% back in June 2022.
Biden will undoubtedly tout the declines as evidence that his agenda is bringing inflation back down to earth, while Trump will likely savage Biden for more than three years of cumulative inflation and tell voters to compare prices now to what they were paying when he was in office, rather than what they were paying a year ago.
“The economic talking point is inflation,” Peter Loge, director of the George Washington University School of Media and Public Affairs, told the Washington Examiner. “Inflation is top of mind for voters across the spectrum. Inflation is down, but most stuff still costs more than it did a few years ago.”
The president will also note that, despite the Fed having to jack up interest rates, the labor market has remained intact and unemployment low — a feat many economists didn’t expect.
Trump is also likely to place the onus for the bout of inflation directly on the shoulders of Biden. Republicans contend a glut of Biden-era federal spending supercharged demand and caused prices to rise. Biden and Democrats, meanwhile, have argued that problems on the supply side, such as Russia’s invasion of Ukraine and the post-pandemic supply chain snarls, caused inflation to spiral. Biden might also note that the United States isn’t alone, and many major countries are experiencing inflation, with some having an even worse go of it than the U.S.
But Biden could counter with the fact that much of the pandemic-era stimulus spending actually happened under Trump, who signed massive stimulus spending into law as COVID-19 was working its way through the country.
Tariffs
Tariff policy might also get some air time. That is in big part because of Trump’s embrace of aggressive tariffs — a departure from traditional conservative orthodoxy.
It is an interesting shift, given that Democrats have been the party advocating for a more protectionist stance on trade policy in recent decades. Trump imposed a beefed-up tariff regime during his first term in office, and Biden has largely kept those in place and, in some instances, even built off them.
But Trump has recently floated 10% across-the-board tariffs, which would be a massive departure from decades of trade policy. The former president even flirted with the idea of reducing the income tax and replacing it with tariffs during a meeting with Republicans in Washington, D.C.
Biden has come out swinging against the 10% tariff idea. He recently told donors that such a proposal would “drive up inflation” and “increase taxes on the average middle class.”
So, Biden could use the debate to attack Trump from a policy position that has more traditionally been a conservative one, rather than attacking Trump from the left.
Taxes
It has long been said nothing is certain but death and taxes, and tax policy will certainly feature in the coming showdown between the two politicians.
Biden and Trump have vastly different visions for how taxation in the U.S. should work. Trump will highlight his signature legislative achievement, the 2017 Tax Cuts and Jobs Act, which lowered the corporate tax rate from 35% to 21% and slashed individual income taxes.
Trump will argue that the tax cuts resulted in an economic boom, with unemployment falling until the pandemic struck during his last year in office.
Without Congress acting, nearly two dozen tax provisions that were part of the Tax Cuts and Jobs Act are set to sunset after 2025 affecting families and small businesses. Trump will likely argue that without electing him and Republicans, Biden will cause taxes to rise.
Biden, though, has accused Trump of wanting tax cuts for the wealthy. He might highlight many of his own tax proposals, most of which he has not been able to see to fruition because of centrist senators and Republican control of the House.
Biden has repeatedly said he wants to hike the headline corporate tax rate from 21% to 28%, the most recent push coming as part of his 2025 budget proposal.
The president has also proposed a 25% minimum tax for billionaires. That provision would only affect the wealthiest 0.01% of taxpayers, according to the White House, and would raise about $500 billion in revenue over the next decade.
Among other tax hikes on the wealthy, Biden has proposed raising the capital gains tax for those earning over $1 million from 20% to 39.6%.
Biden has proposed raising the top marginal tax rate on people making over $400,000 per year to 39.6% — the rate it was before the 2017 tax cuts, up from the current 37%.
Keep in mind that Biden has said his proposals wouldn’t raise taxes for anyone earning less than $400,000 annually. So in the coming fight over the expiring TCJA provisions, the president would have to keep much of the lower individual rates set under Trump in place in order to keep that promise.
Jobs
The Biden administration has touted the strong pace of jobs gains. The labor market has seemingly defied gravity, even as interest rates remain at their highest level in years.
The economy added 272,000 jobs in May, and the unemployment rate is now sitting at 4%, a historically low level. Many economists expected there would have been a recession by now under Biden, but instead, jobs have been plentiful.
“President Biden will point out that his administration has been a job creation machine, with more than 15 million jobs added since he was elected,” Loge said. “If I were Biden, I would keep pointing out that unemployment is down and wages are up.”
But Trump will argue that under his leadership, the jobs market will be even better. He has worked to court blue-collar voters by advocating to bring back the country’s dwindling manufacturing sector.
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The Thursday night debate will take place at CNN’s Atlanta studios at 9 p.m. ET. The debate will be moderated by Jake Tapper and Dana Bash.
While hosted by CNN, the matchup will be simulcast on several other channels like C-SPAN, ABC, NBC, CBS, and others. The Washington Examiner will be contributing coverage of the debate, including fact checks and a liveblog on its website.
