Former President Donald Trump and Vice President Kamala Harris both are "making promises that ignore economic reality," billionaire Howard Marks said.
Trump, the Republican nominee for president, and Harris, the Democrat nominee, will oppose each other in the Nov. 5 presidential election.
Neither candidate has a decisive edge with the public on the economy, The Associated Press poll results showed Friday. About four in 10 registered voters say Trump would do a better job handling the economy, while a similar number say that about the Democrat vice president.
Marks, co-founder and co-chairman of Oaktree Capital Management, wrote an entry under the headline, "Shall We Repeal the Laws of Economics?"
"Like me, you've undoubtedly noticed that politicians ranging from former President Trump and Vice President Harris to down-ballot candidates are back to making promises that ignore economic reality," Marks wrote Thursday in his latest Oaktree memo.
"Trump's call for tariffs and Harris's attack on grocery profiteering are merely two examples of proposals that would impose costs the candidate ignores (in Trump's case) or that fail to reflect a meaningful understanding of the problem (in Harris's case)."
Marks added that his purpose in writing was "not to promote or dismiss either candidate, but rather to illustrate that there is no 'free lunch' in economics, despite candidates' assertions to the contrary."
The billionaire criticized Harris' anti-price gouging policy.
"There's nothing wrong with trying to bring down the cost of necessities," Marks wrote. "However, the best way to do this is to encourage additions to supply. Another way is to not overstimulate demand by injecting excessive liquidity into the economy. Mandating lower prices is generally the least effective way to get them."
Marks also slammed Harris' proposal for $25,000 in downpayment assistance to first-time homebuyers.
"The problem here is that giving a million would-be buyers $25,000 each, or $25 billion in all, would almost certainly result in an immediate increase in home prices, eliminating much of the hoped-for benefit from the program," he wrote.
Trump, who during first term enacted tariffs on goods from China to counter trade practices he considered unfair, has promised 10% across-the-board tariff on imports.
"Those tariffs might discourage imports, stimulate domestic production, and reduce the U.S.'s chronic trade deficit," Marks wrote. "But they'd likely be paid by consumers of imported goods, as manufacturers and exporters are unlikely to absorb a tariff if they can pass it on.
"For many years low-cost imports have held down inflation in the U.S. and enabled Americans to enjoy an attractive standard of living. Broad new tariffs are likely to be the equivalent of price increases for American consumers."
Marks also said that Trump's plan to extend the expiring 2017 tax cuts, keeping the corporate tax rate at 21%, will increase the national deficit by $5.8 trillion in the next decade, or $4.1 trillion if the cut leads to a stimulative impact, Business Insider reported.
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Charlie McCarthy, a writer/editor at Newsmax, has nearly 40 years of experience covering news, sports, and politics.
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