The double-edged advocacy reflects the quandary facing many industry leaders as President Trump continues his unprecedented attempt to overturn the election with the backing of a majority of Republican lawmakers.
Business interests covet the check a Republican-controlled Senate would provide on the incoming Biden administration. But the version of the Republican Party many of them once called home — one that took fidelity to the Constitution for granted — is critically endangered. That fact is exemplified by the chaos engulfing the GOP as top party officials take sides over whether Trump’s evidence-free claims of massive voter fraud justify his attempt to subvert the vote.
Top CEOs and business groups made explicit their objection to the election challenges.
Nearly 200 senior executives signed on to a letter leaning on lawmakers to certify Biden’s win in “the most significant push yet” to ensure Trump’s assault on the election outcome falls short, Josh Dawsey reports. “Signers included a wide array of executives of Fortune 500 companies, from the leaders of banks, airlines, investment firms, pharmaceutical companies, professional sports leagues, real estate conglomerates, top law firms and media companies.”
Among the finance titans adding their names to the letter, organized by the Partnership for New York City: Mastercard CEO Ajay Banga; BlackRock CEO Larry Fink; Blackstone president Jonathan Gray; Lazard CEO Kenneth Jacobs; KKR co-CEO Henry Kravis; Carlyle Group CEO Kewsong Lee; Deutsche Bank Americas CEO Christiana Riley; Evercore Partners Co-CEO Ralph Schlosstein; Guggenheim Partners Executive Chairman Alan Schwartz; Goldman Sachs CEO David Solomon; and Apollo Global Management Co-President James Zelter.
“Attempts to thwart or delay this process run counter to the essential tenets of our democracy,” they write, adding “there should be no further delay in the orderly transfer of power.”
Leading business lobbies in Washington joined the chorus.
- U.S. Chamber of Commerce CEO Tom Donohue said, “Efforts by some members of Congress to disregard certified election results in an effort to change the election outcome or to try a make a long-term political point undermines our democracy and the rule of law and will only result in further division across our nation.”
- National Association of Manufacturers CEO Jay Timmons said disappointment in the election outcome “does not justify harming our democracy or undermining faith in our elections based on unproven charges and conspiracy theories… Now we ask Congress to join us in healing our nation, instead of fostering more division and vitriol.”
- And the Business Roundtable, representing its roster of Fortune 200 CEOs, said it opposes “efforts to delay or overturn the clear outcome of the election. With our country in the midst of a pandemic, business leaders recognize that ongoing division and distrust in our political system threatens the economic recovery and job creation our country desperately needs.”
Yet in the last several weeks, donors from Wall Street and beyond have stepped up support for two Trump stalwarts in Georgia.
Both Sens. Kelly Loeffler and David Perdue have proven loyal allies of the president. And the incumbents underlined the point this week as they defended the Trump’s push to overturn Biden’s victory in their state. Perdue reacted to the news Trump tried to bully Georgia Secretary of State Brad Raffensperger (R) into reversing the election outcome by condemning as “disgusting” the taping and releasing of their Saturday conversation. And Loeffler on Monday declared she would join the dozen Republican senators who have pledged to oppose certifying Biden’s electoral college win, repeating the pledge onstage with Trump at a rally in Dalton, Ga.
The wave of publicly reported contributions predates those latest developments. But Loeffler and Perdue both have campaigned for months as lockstep Trump backers, including by refusing to acknowledge Biden’s win. Wall Street donors nevertheless have been showering the pair with contributions “because they are worried that a Democratic Senate would help President-elect Joe Biden push for tighter regulations on the financial industry,” CNBC’s Brian Schwartz reports, citing an unnamed GOP strategist with banking industry clients.
The roster of high-profile financiers cutting checks directly to one or both of the incumbents in recent weeks, per Schwartz and our own review of the candidates’ most recent federal election filings, includes: hedge fund billionaire John Paulson; Fortress Investment Group CEO Randal Nardone; Arsenal Capital partner Stephen McLean; Silver Point Capital CEO Edward Mule; AQR Capital Management co-founder Clifford Asness; Owl Rock Capital co-founder Doug Ostrover; and Soroban Capital co-founder Eric Mandelblatt.
They join a handful of industry titans who have backed the Republicans on an entirely different scale by giving to the Senate Leadership Fund, the Mitch McConnell-affiliated super PAC. Blackstone Group co-founder Stephen Schwarzman gave that group $15 million on Nov. 12, the same day Citadel founder Ken Griffin forked over $10 million.
As Dawsey notes, Schwarzman didn’t sign the CEO letter on Monday, but Jonathan Gray, the firm’s president and chief operating officer, did.
Loeffler and Perdue personify the challenge facing right-leaning business leaders uncomfortable with the party’s trajectory.
Both appear willing to do whatever it takes to stay in Trump’s good graces. They are also reliable corporate allies, hailing from C-suites themselves. Perdue was a senior executive at Reebok during a business career he capped by serving as CEO of Dollar General.
Loeffler’s husband, Jeffrey Sprecher, is CEO of Intercontinental Exchange, which owns the New York Stock Exchange. Loeffler spent years as a top executive at the company. At the time Georgia Gov. Brian Kemp (R) tapped her to replace retiring Sen. Johnny Isakson in 2019, she was serving as CEO of Bakkt, International Exchange’s platform for trading digital currencies.
Both senators faced Justice Department scrutiny for stock trades they made early last year in the wake of briefings on the threat posed by the then-impending coronavirus pandemic. The Justice Department ended up dropping the probes.
Latest on the federal pandemic response
House Democrats vow new efforts on relief.
Elusive $2,000 checks are among the items being considered: “Rep. Hakeem Jeffries (D-N.Y.), chairman of the House Democratic Caucus, said that the $2,000 checks amount to ‘unfinished business that should be continued as part of our effort to provide additional relief to the American people,’” Erica Werner reports.
“Democrats anticipate writing a new relief bill once Biden is sworn in Jan. 20. Its contours are uncertain, however, and the path forward will depend on the outcome of the Georgia runoff elections … Aid to state and local governments, left out of the most recent relief bill, remains a top priority for Democrats. House Speaker Nancy Pelosi said Sunday that ‘we owe them more.’”
Goldman Sachs economists are predicting Democrats will approve $600 billion in new emergency relief if they sweep the Georgia runoffs to claim control of the Senate. Via AEI’s Jim Pethokoukis:
Fed loan program for midsize firms had few takers: “Washington was happy to rely on the Fed because it had the chops to get a program for medium-size businesses up and running fast. Its apolitical reputation reduced concern about loans being steered to big donors. The Treasury Department became a Fed partner to absorb any loan losses,” the Wall Street Journal’s Nick Timiraos reports.
“But the experience revealed the limitations of running a relief program through the Fed and exposed gaps in the government’s ability to deliver aid to companies that can’t raise money on Wall Street. For months, many banks weren’t interested in participating. Demand picked up only in recent weeks after word came that the program would be ending.”
Wall Street starts the new year with a selloff.
The Dow closed down more than 300 points: “It was a rocky first trading day of the year for Wall Street as stocks fell sharply and investors grew worried about the the pandemic and the economic recovery in 2021,” CNN Business’s Anneken Tappe reports.
“The S&P 500 tumbled 1.5 percent. The Nasdaq Composite (COMP) also ended 1.5 percent lower. Coca-Cola and Boeing were the worst performers in the Dow after both companies were downgraded by analysts. Most S&P sectors, with the exception of energy, ended in the red.”
Bitcoin also tumbled: “The cryptocurrency briefly dipped below $30,000 Monday, just two days after breaching that level for the first time,” CNBC’s Ryan Browne reports.
“Bitcoin slumped as low as $29,316 at around 5:40 a.m. ET Monday, falling 12 percent in the last 24 hours. It later went back above the $30,000 level, paring losses to trade at around $31,420, but was still down more than 6 percent.”
More than one million Americans are still waiting on unemployment benefits.
Jobless Americans are finding themselves ensnarled in red tape as they seek aid. “The Post’s calculation reflects 703,000 pending appeals across the country and 529,000 people waiting on a benefits decision in the states that publicly share that information or that responded to a request for comment,” Alyssa Fowers and Heather Long report.
“People’s claims have been held up for months at times for something as simple as a typo or uploading a scan of a driver’s license instead of a photo. Most delays are the result of three key factors: extensive fraud prevention checks, antiquated computer systems and applications being flagged for extra scrutiny. Claims set aside for manual review often take months to resolve.”
More from the U.S.:
- Another grim record: “More than 128,000 people across the United States are currently hospitalized with covid-19 on Monday, according to data tracked by The Washington Post. That number is a record and represents an increase of 2,800 patients in a single day,” Antonia Noori Farzan reports.
- Officials will stick with the current vaccine regimen: “In recent days, some public health experts have debated whether it is worth taking a scientific gamble by altering the two-dose regimen that proved highly effective in trials to maximize the number of people partially protected with at least one shot as the pandemic surges,” Carolyn Y. Johnson reports.
- TSA screened more than 1.3 million people Sunday, the most during the pandemic: “During the first three days of January, the TSA screened more than 3.3 million people. Approximately 1.2 million people moved through TSA checkpoints Saturday before the record the next day,” Lori Aratani reports.
- Andrew Cuomo threatens to fine hospitals that don’t distribute remaining vaccines: “Under what the New York governor described as a ‘use it or lose it’ policy at a Monday briefing, hospitals can be fined up to $100,000 for failing to distribute existing supplies by the week’s end, or failing to administer doses within seven days once they receive new shipments. He also suggested that future deliveries could be rerouted to hospitals that have been more successful at getting people immunized,” Antonia Noori Farzan reports.
From the corporate front:
- Slack goes down on first workday of the year: “The popular workplace chat app confirmed Monday that customers were experiencing trouble connecting to or using the platform but did not share details about the scope or markets affected. But according to the website Downdetector, which displays outage reports in many metropolitan hubs, the disruption affected users throughout the United States, the United Kingdom, Brazil, France, Japan and beyond,” Hamza Shaban and Rachel Lerman report.
Around the world:
- Some countries are seeing factories bounce back: “Manufacturers across Europe ended 2020 on a high while Asian factory activity expanded moderately thanks to robust demand in regional giant China, surveys showed, but the prospect of tougher coronavirus curbs clouded the outlook for the recovery,” Reuters’s Jonathan Cable and Leika Kihara report.
When superpowers collide
NYSE reverses move to delist Chinese firms.
The reversal comes after more consulting about a recent U.S. investment ban: “In a statement, the Big Board said ‘it no longer intends to move forward with the delisting action’ on China Mobile Ltd., China Telecom Corp. and China Unicom (Hong Kong) Ltd,” the WSJ’s Chong Koh Ping and Ben Otto report.
“The Hong Kong-listed shares of the three telecom majors surged on the news. Shares of China Mobile, which is among the most valuable of China’s listed state-owned enterprises, closed 5.1 percent higher on Tuesday, while China Telecom and China Unicom jumped 3.3 percent and 8.5 percent respectively. NYSE’s earlier plan to delist the companies followed a U.S. government order, signed by Trump in November, that prohibits Americans from investing in a list of companies the U.S. government says supply and support China’s military, intelligence and security services.”
- What changed: “NYSE on Monday said it had further discussions with ‘relevant regulatory authorities’ about the Treasury Department’s recent statement on its intention to publicly name the subsidiaries of the banned groups.”
Wells Fargo to expand investment bank.
CEO Charlie Scharf continues to leave his imprint: “The push would take the fourth-largest U.S. bank a step closer to emulating some of its biggest rivals, including JPMorgan Chase & Co., where Scharf spent over a decade before running Visa Inc. and Bank of New York Mellon Corp,” Bloomberg News’s Hannah Levitt reports.
“Inside Wells Fargo, managers say they intend to build a more commensurate presence on Wall Street, where the firm ranks a mere ninth in capital markets and deal advisory, by focusing on business lines and industries where it already has credibility. That would translate, for example, to providing more underwriting and merger advice to corporate clients, but also lending to hedge funds looking to ramp up bets.”
Brexit forces bankers to shift trading of European stocks: “The fallout from Britain’s split from the European Union showed itself on the first trading day of the year as a big chunk of dealing volume in EU stocks moved from London to venues located in Amsterdam, Paris and the Continent’s other financial centers,” the WSJ’s Ben Dummett reports.
“Britain’s membership of the EU had meant the region’s banks and investors could bypass the home exchanges of stocks such as Paris-listed luxury-goods giant LVMH Moët Hennessy Louis Vuitton SE and Amsterdam-listed Just Eat Takeaway.com NV, the big food-delivery company, and trade them in London over alternative venues … But with the Brexit trade agreement taking effect Jan. 1, that option ended.”
Fiat Chrysler, Peugeot get green light for $52 billion merger: “With annual production of around 8 million vehicles worldwide and revenues of more than 165 billion euros ($203 billion), the newly-formed firm is expected to play a key role in the auto industry’s jump into the new era of electrification,” Reuters’s Giulio Piovaccari and Gilles Guillaume report.
High-profile health venture is disbanding: “Haven, created two years ago by Amazon, JPMorgan Chase and Berkshire Hathaway to address soaring health-care costs and improve patient outcomes, announced in a terse statement on its website Monday that it will shutter,” Jay Greene reports.
“It’s a stark shift from the ambitious announcement of the group’s creation three years ago by Amazon’s Jeff Bezos, JPMorgan’s Jamie Dimon and Berkshire’s Warren Buffett … Haven demonstrated plenty of ambition when it debuted in 2018. At the time, the three prominent executives put their names behind the effort, garnering massive media coverage for their efforts to address one of the most intractable challenges in corporate America. Reducing costs was a primary objective.” (Bezos owns The Washington Post.)
Jack Ma’s disappearance fuels speculation: “The Alibaba founder’s absence from public view in the past two months, including missing the final episode of a TV show on which he was to appear as a judge, has fueled social media speculation over his whereabouts amid a Chinese regulatory clampdown on his sprawling business empire,” Reuters’s Tony Munroe and Brenda Goh report.
Google employees form workers’ union in the U.S.: “More than 200 employees and contractors at Google parent Alphabet Inc in the United States and Canada have formed a labor union to promote workplace equity and ethical business practices, the group’s elected leaders said,” Reuters’s Paresh Dave and Ayanti Bera report.
“The group’s formation builds on unprecedented protests by Google workers in recent years. While the tech industry has seen minimal union activity and worker pushback historically, thousands of people at Alphabet had banded together to publicly criticize Google’s handling of sexual harassment complaints, its work with the U.S. military and other issues.”
From Heidi Shierholz, policy director at the Economic Policy Institute:
- Georgia holds runoff elections that will determine the Senate majority
- The Fed releases minutes from the FOMC’s December meeting
- Congress counts the electoral college votes, the final step in the 2020 presidential election
- The Labor Department releases the latest weekly jobless claims
- The Labor Department releases the December jobs report