Name: “They’re Saying, ‘We’d Like to See Biden Crush Trump’”: For Some on Wall Street Beating Trump Is More Important Than Money
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“They’re Saying, ‘We’d Like to See Biden Crush Trump’”: For Some on Wall Street Beating Trump Is More Important Than Money

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Most of Wall Street, it seems, is happily preparing for a Joe Biden victory in November. “The majority of my friends on Wall Street would like to see Trump lose to Biden,” one very senior investment banker tells me. “They’re saying, ‘We’d like to see Biden crush Trump.’” And that is without knowing exactly what Biden and the 117th Congress—to be elected on November 3—will do about such important economic topics such as the corporate tax rate, the capital gains tax rate, or taxes on the wealthiest Americans. The consensus on Wall Street seems to be that a Biden presidency will mean an overhaul of the Trump 2018 tax law. That means higher tax rates for the very wealthy, for corporations—likely an increase in the tax rate to 28%, from 21%—and on capital gains.At a virtual fundraiser on June 29 with Wall Street types, Biden said he’ll likely roll back much of Trump’s $2 trillion tax cut “and a lot of you may not like that.” Interestingly, in my conversations with Wall Street executives, bankers and traders, higher taxes seems to be a small price to pay to be rid of Donald Trump. “Wall Street’s not this amorphous, unified blob,” the senior Wall Street banker continues, “but the majority of people I talk to on Wall Street think it’s worth taking the hit to get Trump out of office. They view him as an existential threat.”Robert Wolf, the former head of UBS in the Americas who now has his own advisory and investment firm, 32 Advisors, concurs. Wolf, who was once described as Barack Obama’s favorite investment banker, says Wall Street understands the numbers: the multi-trillion-dollar annual federal budget deficits and a national debt at $24 trillion. “The numbers don’t lie,” Wolf says. “Those managers who are best on Wall Street are preparing for possible changes in tax reform, are preparing for how best to look at infrastructure, are preparing for what we’ve seen under this administration of more nationalistic policy that hopefully will change. People prepare for change. They don’t necessarily institute the policies, but they start preparing for change, and the good Wall Street firms, they look at where they think 2021 can be, and they look at the changes where each administration could have, and they start planning for that.”He says he’s convinced if the election were held today, Biden would win, big. The election is “predominantly a referendum on Donald Trump,” Wolf continues. “He’s at his lowest approval polls to date. If the election was today, I think that the Democratic Party would win the presidency, the Senate, and the House.” He says Wall Street, while not monolithic in its voting patterns, looks “at the volatility and the lies that come out of this White House, and my gut tells me that they’re exhausted from it. The old saying that people vote with their pocketbook, I’m not sure I agree with that. I think there’s more to people. I believe that people are much more substantive than just the pocketbook.” He says that what has been revealed by the COVID pandemic and the faltering economy is “income inequality, health inequality, and racial inequality,” and voters are going to be focused on the candidate that is best able to articulate solutions to these serious problems. He thinks Biden is the best qualified to address these issues. “Biden is going to focus on how we can grow, and how we can grow in a fair and just way,” Wolf says. “I think you’ll see the corporate rate go up. You’ll see the highest earners’ income tax rate go up. I think it’s expected. I don’t think any of this is unexpected…I think there will be clear-cut disagreements between what’s the best way to take our country into 2021. Certainly, my view is that the Biden campaign is going to be able to show why they have the best case and the best person to lead.”Both Wolf and the senior Wall Street banker also seem to agree the inevitable raising of taxes in a Biden administration has less to do with a road-to-Damascus epiphany about the ongoing dangers of fiscal irresponsibility but rather is about trying to do the right thing for more people. Coming to grips with higher taxes, Wolf says, is more about “rearranging” who gets the benefits. The senior investment banker says both Wall Street and academia are split about the wisdom of higher deficits and the growing national debt. He says economists who subscribe to Modern Monetary Theory argue “we’ve got a lot of runway” and “should use that runway to address social inequities.” More traditional economists, he says, believe deficits do matter and debt needs to be repaid. “Old-school people say, ‘It’s great that Visa just gave you an extra $30,000 on your credit card, but don’t think that makes you rich.’”He says Wall Street is divided. “I have friends that continue to be deficit hawks, and I have friends that say, ‘You know, I understand that your deficit-hawk friends think we’re just creating a liability that your grandchildren are going to have to deal with, but if we spend intelligently today to make the future better, that may outweigh the incremental debt incurrence.’ Well, when have you ever seen intelligent spending?” His reply to them is, “What you’re saying is more theological than logical. It’s faith-based.” He continues, “I don’t think there’s any consensus. I think everybody recognizes that the number one lever on what the world’s going to look like in the near and medium term is ‘What the shape of the pandemic curve looks like.’”Unlike Wolf, the senior banker is less sanguine about the prospect of the Democrats winning the Senate. In fact, he doesn’t want them to. He says Wall Street wants to see legislative gridlock in Washington. He says since people he knows on Wall Street aren’t sure (yet) who Biden will pick as his vice president and how progressive, or worse, she will be, it’s better to keep things as close to the center of the fairway as possible. “Maybe it’d be good to have the Republicans keep the Senate,” he says, “as a check. Almost voting for making sure nothing radical happens. They’re worried about the extremes on both sides. They’re looking to gridlock as a better scenario. Now, that doesn’t address the deep inequities and inequalities that this pandemic has ripped the lid off of, right? People are worried about social revolution. Systemic racism exists. It’s a core fundamental issue in this country. It has been for my entire life, except I don’t think I really appreciated it, except in the last few years to the same degree. But I’m listening to the talking heads on CNN and MSNBC, which is what I watch, I don’t watch Fox. And I’m thinking, You know what? They’re talking ‘revenge politics.’ When they start talking about reparations, it’s almost like their language is becoming, ‘We want revenge.’ That’s not going to work.”As Rachel Maddow likes to say, “Watch this space.” It’s going to be an interesting four months.More Great Stories From Vanity Fair— The Parallel Universe of Ivanka Trump, America’s — : A Black Journalist Addresses His White Friends— Why Bankrupt Hertz Is a — Scenes of at the Minneapolis Protests— Brandi Collins-Dexter on Why Facebook Chooses Trump Over Democracy— Democrats’ Blue-Texas May Finally Become a Reality— From the Archive: Taking Stock of Melania Trump, the Looking for more? for our daily Hive newsletter and never miss a story.Most PopularThe freshest-and most essential-updates from Washington, Wall Street, and Silicon Valley.

Most of Wall Street, it seems, is happily preparing for a Joe Biden victory in November. “The majority of my friends on Wall Street would like to see Trump lose to Biden,” one very senior investment banker tells me. “They’re saying, ‘We’d like to see Biden crush Trump.’” And that is without knowing exactly what Biden and the 117th Congress—to be elected on November 3—will do about such important economic topics such as the corporate tax rate, the capital gains tax rate, or taxes on the wealthiest Americans. The consensus on Wall Street seems to be that a Biden presidency will mean an...

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Husband. Father. Best-selling author of six books. Seventh: November 2022. Founding partner, @Pucknews. Air Mail writer-at-large. Occasional NYT Op-Ed Writer.

William D. Cohan

Vanity Fair is a monthly magazine of popular culture, fashion, and current affairs published by Condé Nast in the United States.  The first version of Vanity Fair was published from 1913 to 1936. The imprint was revived in 1983 and currently includes five international editions of the magazine. As of 2018, the Editor-in-Chief is Radhika Jones.

“They’re Saying, ‘We’d Like to See Biden Crush Trump’”: For Some on Wall Street Beating Trump Is More Important Than Money

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