After a close race, Joe Biden will be the next president of the United States. Here’s a look at where the president-elect stands on some of the key policy issues, according to The New York Times:
Covid-19: Biden has campaigned on a “whatever it takes” approach to the ongoing pandemic.
- His plans include improving testing, expanding the production of personal protective equipment, ensuring the development of safe vaccines and opening schools.
- Biden aims to implement official mask mandates and isn’t adverse to full lockdowns if scientists recommend them.
Health Care: Biden doesn’t aim to create a universal, single-payer health care program, “Medicare for all” if you will, or eliminate private insurance. He’s a supporter of expanding the Affordable Care Act and adding a public option. Biden has vowed to protect Americans with pre-existing conditions with access to health care.
- Biden previously announced a plan to lower the Medicare eligibility age to 60 from 65 and aims to “reduce the premiums and reduce drug prices.”
Economy: Biden’s incoming administration has titled its economic recovery plan under the name “Build Back Better,” which promises to create millions of jobs and “the economic revival to tackling climate change, racial equity and reinvestment in American manufacturing.”
- Biden’s proposing $300 billion in government spending on research and development on things like electric vehicles and 5G networks. He also calls for another $400 billion to be spent on U.S. Manufactured products.
- Biden’s plan would impose a 10 percent “offshoring penalty surtax” on any U.S. company that tries to move production overseas for domestic sales. He also aims to modify the tax code to incentivize companies to produce stateside.
Taxes: Biden wants to roll back tax cuts for corporations and the highest earners, a departure from President Trump’s “tax overhaul.”
- The president-elect has proposed upping the corporate tax rate to 28%, from 21%, and keeping tax cuts in place for those making less than $400,000 annually.
- According to an analysis done at the University of Pennsylvania, Biden’s proposal would increase tax revenue by $3.4 trillion over a decade, and 80% of the increase would come from the top 1%.
Climate Change: Over the summer, Biden outlined a $2 trillion plan to “develop clean energy and eliminate emissions from the power sector by 2035.”
- He’s notably declined to support the Green New Deal, a far-left leaning climate plan, though his website refers to it as a “crucial framework.”
- Biden wants to transition away from the oil industry and things like fracking but doesn’t plan to do so “cold turkey.” Instead, his goal is to reduce subsidies for fossil fuels and end the permitting of new fracking on federal lands.
Looking Ahead: Over the next few months, states will certify election results, and the Electoral College will cast its official votes. President Trump continues to question the integrity of the election and is reportedly pursuing legal action, but experts say overturning the results is unlikely. Biden has officially launched his transition, naming a Covid-19 advisory board, and will be inaugurated on Jan. 20.
In the short-term, sudden, harsh lockdowns could cause another economic contraction and may be a potential downside risk for the market. But there’s a fair chance that the market is willing to look past lockdowns if a promising vaccine is really this close to being approved. I also assume we will see stronger fiscal stimulus in early 2021. I am net bullish on the market from here and will be looking to buy more stocks with our cash allocation over the coming weeks.
Politics aside, Trump’s hardline stance against outsourcing American manufacturing and jobs and against China’s trade advantages have become largely bipartisan views, which I believe to be good for the American economy long-term. I will also be encouraged to see government support for clean energy industries like electric vehicles and solar. As the wounds heal from the election, I am as bullish on American innovation as ever and will invest accordingly.