vision 2021

Biden 2020: Change That Wall Street Liberals Can Believe In?

“Is that COVID on my hand or are you just unhappy to see me?” Photo: Frederic J Brown/AFP via Getty Images

Joe Biden will mount an “FDR-size” presidency that remakes America’s energy grid, revives organized labor, turns housing into an entitlement, soaks the rich, and expands the welfare state while reaching across the aisle to find bipartisan solutions to America’s problems. He will get the U.S. to net-zero emission by 2050 while protecting Pennsylvania’s fracking industry. He’ll revive the economy with a $2 trillion stimulus package and get the federal deficit under control. He’ll reform our overly punitive criminal-justice system and force anyone caught with a dime bag once into mandatory rehab. He’ll restore the civil liberties that Donald Trump has trampled on and arrest “anarchists” who disturb the peace. He’ll be an agent of change and restoration.

In America’s two-party system, winning coalitions are always rife with internal contradictions, and presidential nominees generally try to be all things to all party-aligned interest groups. But Biden 2020’s “big tent” is capacious even by U.S. standards. The Democratic nominee has earned the support of former Occupy Wall Street activists and Wall Street bankers, anti-imperialists and neoconservatives, America’s most prominent neo-Nazi and the head of the Revolutionary Communist Party, USA. Meanwhile, drawing on a half-century of experience in triangulation, Biden has regaled audiences at the Democratic National Convention and on the campaign trail with a masterful impersonation of a Rorschach blot.

Still, many progressives can’t help seeing what Wall Street sees in Biden — and vice versa. Over the holiday weekend, the Washington Post threw a spotlight on the intraparty tensions that Biden has tried to suppress:

When Joe Biden released economic recommendations two months ago, they included a few ideas that worried some powerful bankers: allowing banking at the post office, for example, and having the Federal Reserve guarantee all Americans a bank account.

But in private calls with Wall Street leaders, the Biden campaign made it clear those proposals would not be central to Biden’s agenda.


“They basically said, ‘Listen, this is just an exercise to keep the Warren people happy, and don’t read too much into it,’” said one investment banker, referring to liberal supporters of Sen. Elizabeth Warren (D-Mass.). The banker, who spoke on the condition of anonymity to describe private talks, said that message was conveyed on multiple calls.

These assurances to investment bankers came as the Biden campaign raked in a record-setting $365 million in campaign donations last month. The majority of that money came courtesy of small-dollar online donors. But high-dollar patrons from Wall Street and Silicon Valley also substantially upped their investments in the Democratic ticket following the heartening news that Kamala Harris (and not Elizabeth Warren) would be the Biden administration’s second-in-command.

Some on the left look at these developments and conclude that Biden’s every gesture in their direction is a lie. Uncle Joe may sell “Social Democracy Lite” on the campaign trail, but once in office, he will govern like it’s 1995: There will be no green stimulus, only grand bargains on the deficit. No incremental expansions of social provision, only phased-in cuts to Social Security.

It is impossible to know with certainty how a Biden administration will govern should it get the chance. Much will depend on the composition of the Senate, the trajectory of the pandemic, the efficacy of competing activist and lobbying efforts, among other emergent events. But the case for maximal progressivism pessimism strikes me as weak. Judging by the available evidence, it seems to me that Biden and a Democratic Senate would pursue an agenda that modestly redistributes income from capital to labor — without redistributing power from the party’s favored industries to the public sector.

Biden’s enthusiasm for mediation won’t get him very far with Mitch McConnell. The divisions between each party’s congressional caucus on big-ticket issues are too steep for baby-splitting. But there’s room for reluctant comprise between the left wing of Wall Street and the right wing of the activist left. Finance and tech executives who oppose even mild redistribution don’t generally bankroll Democrats. There are plenty of very wealthy business people in the United States who prefer left neoliberalism to creeping neo-feudalism, and see slightly higher marginal tax rates as a small price to pay for shoring up the legitimacy of the social order they sit atop, and/or for preventing their grandchildren from inheriting a planet that’s nasty, brutish, and hot. A slightly more egalitarian economy is not threatening to America’s bleeding-heart oligarchs — so long as that economy isn’t built in their own industry’s backyard.

It wasn’t Biden’s call for spending $2 trillion in four years on climate projects, or his endorsement of turning Section 8 housing vouchers into an entitlement, or plans for paid family leave and child care that his campaign had to disavow in private conversations with its favorite Wall Street rentiers — it was his apparent embrace of postal banking, a policy that would enable the public sector to perform some functions currently reserved for private finance. By providing America’s poor with basic financial services, postal banking could theoretically impinge on the business models of payday lenders in the near term. Perhaps more significantly, if successful, such a program could invite further incursions into private financial capital’s prerogatives in the long run. Thus, this was the idea that raised Wall Street’s hackles. Similarly, Silicon Valley’s mindful megamillionaires don’t begrudge the working-class some social support (don’t get them started on UBI), and would very much like reality-based climate policies and public subsidies for green technology — so long as reform doesn’t trespass on their corporate fiefdoms (and office parks). And, while Biden and Harris have offered (often perfunctory) support for a wide array of progressive policy ideas, both have dutifully hedged on proposals for breaking up giant tech firms.

Again, this is conjecture. But one objective truth is that life for working people in the United States is much worse — and status-quo economic policy, much more regressive — than the status quo’s “winners” need it to be. This was the all but explicit message of Biden’s infamous (and often misrepresented) quote to well-heeled donors at the Carlyle Hotel in 2019.

“Truth of the matter is, you all know, you all know in your gut what has to be done,” Biden told his wealthy patrons, shortly after his campaign launch. “We can disagree in the margins. But the truth of the matter is, it’s all within our wheelhouse and nobody has to be punished. No one’s standard of living would change. Nothing would fundamentally change … When you have income inequality as large as we have in the United States today, it brews and ferments political discord and basic revolution. It allows demagogues to step in.”

Here, Biden was not saying that, if he had his druthers, nothing significant would change in the lives of ordinary Americans — or that nothing whatsoever would change about his audience’s tax liabilities — but rather, that inequality has reached such exceptional levels, he could redistribute significant income from the rich to the poor without putting a dent in the former’s living standards. To the contrary, what mild reform cost the wealthy in taxes it would more than make up for in “revolution” insurance. And it is true that America can remain a paradise for plutocrats while guaranteeing health care, housing, and a living wage for its poor. Other capitalist democracies have already done this. There are still billionaires in Sweden.

So, I’d take 2019, Carlyle Hotel Biden at his word. Reforms that challenge the fundamental interests of Democratic-aligned industries won’t travel far in the Biden-Harris administration, or at least, not in the absence of sustained social-movement pressure. But measures that mitigate the deprivation of the poor, reduce the living expenses of the middle class, and move America in the general direction of net-zero carbon emissions will be on the table. Nothing will fundamentally change for Michael Bloomberg and friends. But some things could plausibly and positively change for working people in the short term, and the planet in the long one.

Biden 2020: Change That Wall Street Liberals Can Believe In?