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Can Harris Really Build 3 Million New Housing Units?
Luke Muir and his wife moved to Phoenix from Louisiana two years ago for a better-paying job. They prepared for higher temperatures and low housing costs. The weather has lived up to their expectations; housing prices have not.
Pretty much since they arrived, Mr. Muir and his family have been trying and failing to find a single-family house for no more than $500,000. The options have been too small, too remote or too much of a fixer-upper.
“I’m like, ‘Wow, I thought this would be a more affordable place to live,’” said Mr. Muir, who is 44 and works in financial services. “It’s not like it’s San Diego or L.A. or some other place that is just known for astronomical prices.”
Across the country, rising prices and rents have become a crisis — eroding family budgets and leading to doubled-up households and multiplying homeless camps. The root of this pain is a decades-old housing shortage.
The remedy proposed by Vice President Kamala Harris is contained in a housing plan that, among other things, calls for the construction of three million new housing units over the next four years — a 50 percent increase over the current pace of building.
Vastly expanding the supply of housing is the only thing economists believe will make a meaningful difference in an affordability crunch. They disagree, however, about whether Ms. Harris’s plan would actually do that. (Economists also agree that former President Donald J. Trump’s housing plan, which aims to free up housing by deporting immigrants, would probably make the housing crisis worse by devastating the construction work force).
Reduced to its essence, Ms. Harris’s plan aims to flood the system with money for builders and buyers in the hope that it will jolt the construction market. It calls on Congress to expand a federal tax credit for subsidized rental housing while creating a new tax credit for developers to build starter homes, and another credit for families looking to rehabilitate their own worn-down housing stock. It also creates a $25,000 credit for first-time home buyers.
Mark Zandi, the chief economist of Moody’s Analytics, who has advised the Harris campaign, called it the most aggressive plan to increase the nation’s housing supply since modern suburbs were built after World War II. And if the numbers were to pencil out as neatly as they do in Ms. Harris’s 82-page economic plan, Mr. Zandi’s superlative would be accurate.
But that “if” creates pause.
Developers in Phoenix and elsewhere are naturally amenable to a federal plan that would reduce their taxes. Many developers said the idea of giving first-time home buyers money, which buyers would then give to them, sounded nice, too.
The question, as ever, is where and how they will build. This is why other economists, such as Ed Pinto at the market-oriented American Enterprise Institute, have said Ms. Harris’s plan would make shortages worse by inflating housing demand (because the home buyer credit would give families more to spend) without doing enough to increase supply.
Over the past half-century, Phoenix grew into one of America’s largest cities by building low-slung neighborhoods further and further outward. That playbook kept housing affordable for a long time, but no longer.
The average price of a home in Maricopa County, which surrounds Phoenix, is now $470,000, up about 50 percent since the pandemic. And that pattern of expansion is resulting in the same problems — congestion, smog, water shortages, sprawl — that many residents moved there from California to escape.
The Arizona Legislature recently passed several laws designed to speed construction and make neighborhoods denser — to build more housing per lot — but it will take more than a few years for that to translate into ramped-up building.
“We can turn 40 acres of cotton field into a subdivision in the blink of an eye,” said Jason Morris, a land use attorney at Withey Morris Baugh in Phoenix. “But that is much easier than trying to do 75 apartments in the middle of a neighborhood.”
Ms. Harris’s plan includes a $40 billion “Local Innovation Fund” that would, among other things, encourage cities to make building faster and easier by cutting the regulations that consume local zoning meetings. But for that to work, cities in Arizona and elsewhere have to want to change how they grow, which so far many are reluctant to do.
Even Mr. Muir, the frustrated home buyer, is leery of neighborhoods becoming too compact. Many of the new developments he sees when he is house-hunting are town-home projects or ones built so closely together that they might as well be apartments, he said.
“It’s baffling that people can reach out their window and touch the neighbor’s wall,” Mr. Muir said.
Would this housing, smaller and tighter, fulfill the American dream of people like Mr. Muir?
The solution to the country’s housing shortage will almost certainly require some sort of federal program — one that may be tough to get through Congress. But for a rush of money to work, cities and states also have to want it.
Ms. Harris’s main challenge will be convincing them to build. And then persuading Americans to be happy with it.
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Brass bands in Beijing make way for sticker shock at home as Trump returns to escalating inflation
WASHINGTON (AP) — President Donald Trump returned from the spectacle of a Chinese state visit to a less than welcoming U.S. economy — with the military band and garden tour in Beijing giving way to pressure over how to fix America’s escalating inflation rate.
Consumer inflation in the United States increased to 3.8% annually in April, higher than what he inherited as the Iran war and the Republican president’s own tariffs have pushed up prices. Inflation is now outpacing wage gains and effectively making workers poorer. The Cleveland Federal Reserve estimates that annual inflation could reach 4.2% in May as the war has kept oil and gasoline prices high.
Trump’s time with Chinese leader Xi Jinping appears unlikely to help the U.S. economy much, despite Trump’s claims of coming trade deals. The trip occurred as many people are voting in primaries leading into the November general election while having to absorb the rising costs of gasoline, groceries, utility bills, jewelry, women’s clothing, airplane tickets and delivery services. Democrats see the moment as a political opportunity.
“He’s returning to a dumpster fire,” said Lindsay Owens, executive director of Groundwork Collaborative, a liberal think tank focused on economic issues. “The president will not have the faith and confidence of the American people — the economy is their top issue and the president is saying, ‘You’re on your own.’”
The president’s trip to Beijing and his recent comments that indicated a tone-deafness to voters’ concerns about rising prices have suggested his focus is not on the American public and have undermined Republicans who had intended to campaign on last year’s tax cuts as helping families.
Trump described the trip as a victory, saying on social media that Xi “congratulated me on so many tremendous successes,” as the U.S. president has praised their relationship.
Trump told reporters that Boeing would be selling 200 aircraft — and maybe even 750 “if they do a good job” — to the Chinese. He said American farmers would be “very happy” because China would be “buying billions of dollars of soybeans.”
“We had an amazing time,” Trump said as he flew home on Air Force One, and told Fox News’ Bret Baier in an interview that gasoline prices were just some “short-term pain” and would “drop like a rock” once the war ends.
Inflationary pain is not a factor in how Trump handles Iran
Trump departed from the White House for China by saying the negotiations over the Iran war depended on stopping Tehran from developing nuclear weapons. “I don’t think about Americans’ financial situation. I don’t think about anybody. I think about one thing: We cannot let Iran have a nuclear weapon,” Trump said.
That remark prompted blowback because it suggested to some that Trump cared more about challenging Iran than fighting inflation at home. Trump defended his words, telling Fox News: “That’s a perfect statement. I’d make it again.”
The White House has since stressed that Trump is focused on inflation.
Asked later about the president’s words, Vice President JD Vance said there had been a “misrepresentation” of the remarks. White House spokesman Kush Desai said the “administration remains laser-focused on delivering growth and affordability on the homefront” while indicating actions would be taken on grocery prices.
But as Trump appeared alongside Xi, new reports back home showed inflation rising for businesses and interest rates climbing on U.S. government debt.
His comments that Boeing would sell 200 jets to China caused the company’s stock price to fall because investors had expected a larger number. There was little concrete information offered about any trade agreements reached during the summit, including Chinese purchases of U.S. exports such as liquefied natural gas and beef.
“Foreign policy wins can matter politically, but only if voters feel stability and affordability in their daily lives,” said Brittany Martinez, a former Republican congressional aide who is the executive director of Principles First, a center-right advocacy group focused on democracy issues.
“Midterms are almost always a referendum on cost of living and public frustration, and Republicans are not immune from the same inflation and affordability pressures that hurt Democrats in recent cycles,” she added.
Democrats see Trump as vulnerable
Democratic lawmakers are seizing on Trump’s comments before his trip as proof of his indifference to lowering costs. There is potential staying power of his remarks as Americans head into Memorial Day weekend facing rising prices for the hamburgers and hot dogs to be grilled.
“What Americans do not see is any sympathy, any support, or any plan from Trump and congressional Republicans to lower costs – in fact, they see the opposite,” Senate Democratic leader Chuck Schumer of New York said Thursday.
Vance faulted the Biden administration for the inflation problem even though the inflation rate is now higher than it was when Trump returned to the White House in January 2025 with a specific mandate to fix it.
“The inflation number last month was not great,” Vance said Wednesday, but he then stressed, “We’re not seeing anything like what we saw under the Biden administration.”
Inflation peaked at 9.1% in June 2022 under Biden, a Democrat. By the time Trump took the oath of office, it was a far more modest 3%.
Trump’s inflation challenge could get harder
The data tells a different story as higher inflation is spreading into the cost of servicing the national debt.
Over the past week, the interest rate charged on 10-year U.S. government debt jumped from 4.36% to 4.6%, an increase that implies higher costs for auto loans and mortgages.
“My fear is that the layers of supply shocks that are affecting the U.S. economy will only further feed into inflationary pressures,” said Gregory Daco, chief economist at EY-Parthenon.
Daco noted that last year’s tariff increases were now translating into higher clothing prices. With the Supreme Court ruling against Trump’s ability to impose tariffs by declaring an economic emergency, his administration is preparing a new set of import taxes for this summer.
Daco stressed that there have been a series of supply shocks. First, tariffs cut into the supply of imports. In addition, Trump’s immigration crackdown cut into the supply of foreign-born workers. Now, the effective closure of the Strait of Hormuz has cut off the vital waterway used to ship 20% of global oil supplies.
“We’re seeing an erosion of growth,” Daco said.
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Top Drug Regulator Is Fired From the F.D.A.
Dr. Tracy Beth Hoeg, the Food and Drug Administration’s top drug regulator, said she was fired from the agency Friday after she declined to resign.
She said she did not know who had ordered her firing or why, nor whether Health Secretary Robert F. Kennedy Jr. knew of her fate. The Department of Health and Human Services did not immediately respond to a request for comment.
The departure reflected the upheaval at the F.D.A., days after the resignation of Dr. Marty Makary, the agency commissioner. Dr. Makary had become a lightning rod for critics of the agency’s decisions to reject applications for rare disease drugs and to delay a report meant to supply damaging evidence about the abortion drug mifepristone. He also spent months before his departure pushing back on the White House’s requests for him to approve more flavored vapes, the reason he ultimately cited for leaving.
Dr. Hoeg’s hiring had startled public health leaders who were familiar with her track record as a vaccine skeptic, and she played a leading role in some of the agency’s most divisive efforts during her tenure. She worked on a report that purportedly linked the deaths of children and young adults to Covid vaccines, a dossier the agency has not released publicly. She was also the co-author of a document describing Mr. Kennedy’s decision to pare the recommendations for 17 childhood vaccines down to 11.
But in an interview on Friday, Dr. Hoeg said she “stuck with the science.”
“I am incredibly proud of the work we were doing,” Dr. Hoeg said, adding, “I’m glad that we didn’t give in to any pressures to approve drugs when it wasn’t appropriate.”
As the director of the agency’s Center for Drug Evaluation and Research, she was a political appointee in a role that had been previously occupied by career officials. An epidemiologist who was trained in the United States and Denmark, she worked on efforts to analyze drug safety and on a panel to discuss the use of serotonin reuptake inhibitors, the most widely prescribed class of antidepressants, during pregnancy. She also worked on efforts to reduce animal testing and was the agency’s liaison to an influential vaccine committee.
She made sure that her teams approved drugs only when the risk-benefit balance was favorable, she said.
The firing worsens the leadership vacuum at the F.D.A. and other agencies, with temporary leaders filling the role of commissioner, food chief and the head of the biologics center, which oversees vaccines and gene therapies. The roles of surgeon general and director of the Centers for Disease Control and Prevention are also unfilled.
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Supreme Court is death knell for Virginia’s Democratic-friendly congressional maps
The U.S. Supreme Court
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The U.S. Supreme Court refused Friday to allow Virginia to use a new congressional map that favored Democrats in all but one of the state’s U.S. House seats. The map was a key part of Democrats’ effort to counter the Republican redistricting wave set off by President Trump.
The new map was drawn by Democrats and approved by Virginia voters in an April referendum. But on May 8, the Supreme Court of Virginia in a 4-to-3 vote declared the referendum, and by extension the new map, null and void because lawmakers failed to follow the proper procedures to get the issue on the ballot, violating the state constitution.
Virginia Democrats and the state’s attorney general then appealed to the U.S. Supreme Court, seeking to put into effect the map approved by the voters, which yields four more likely Democratic congressional seats. In their emergency application, they argued the Virginia Supreme Court was “deeply mistaken” in its decision on “critical issues of federal law with profound practical importance to the Nation.” Further, they asserted the decision “overrode the will of the people” by ordering Virginia to “conduct its election with the congressional districts that the people rejected.”
Republican legislators countered that it would be improper for the U.S. Supreme Court to wade into a purely state law controversy — especially since the Democrats had not raised any federal claims in the lower court.
Ultimately, the U.S. Supreme Court sided with Republicans without explanation leaving in place the state court ruling that voided the Democratic-friendly maps.
The court’s decision not to intervene was its latest in emergency requests for intervention on redistricting issues. In December, the high court OK’d Texas using a gerrymandered map that could help the GOP win five more seats in the U.S. House. In February, the court allowed California to use a voter-approved, Democratic-friendly map, adopted to offset Texas’s map. Then in March, the U.S. Supreme Court blocked the redrawing of a New York map expected to flip a Republican congressional district Democratic.
And perhaps most importantly, in April, the high court ruled that a Louisiana congressional map was a racial gerrymander and must be redrawn. That decision immediately set off a flurry of redistricting efforts, particularly in the South, where Republican legislators immediately began redrawing congressional maps to eliminate long established majority Black and Hispanic districts.
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