Elizabeth Warren Has A Lot of Supporters On Wall Street Over Trump - Vox

10/23/2019 Elizabeth Warren has a lot of supporters on Wall Street over Trump - Vox
Elizabeth Warren’s Wall Street fans back her because of her policies, not in spite of them. | Zach Gibson/Getty Images
The Wall Streeters who actually like

Elizabeth Warren
“I’m fully on board with soaking the rich, 100 percent, and if that involves me
paying more taxes, let’s go.”
By Emily Stewart emily.stewart@vox.com Oct 23, 2019, 7:30am EDT
On Wall Street, there are rich guys, and then there are very rich guys. And in the first
camp, there are a surprising number who think an Elizabeth Warren presidency would not
be the apocalypse.
“You know what I like about Warren? Warren doesn’t want my money, actually,” said one
mid-level hedge fund executive who has already maxed out on his donation to the
Massachusetts Democrat in the 2020 presidential primary. “My firm is great, but some
people in the industry are scumbags.”
Warren is a longtime critic of the financial industry, and she has made her fair share of
enemies among some of its major players. There has been a litany of stories in recent
months — including one I wrote — quoting finance executives and bankers on how
https://www.vox.com/policy-and-politics/2019/10/23/20916138/wall-street-elizabeth-warren-supporters-donald-trump 1/12
disastrous they believe a Warren presidency would be: Deciding between Donald Trump
and Warren is a “decision between sickness and death.” Major Wall Street Democratic
donors will sit the election out. Warren is the one candidate who is “toxic for the
business community.”
But not everyone on Wall Street hates her. In fact, there are plenty of people who believe
the idea of Warren in the White House sounds pretty good. And it’s not a grudging
acceptance of her worldview but instead genuine support for it.
Some in the industry believe that the excesses of the financial system continue to be a
problem in the wake of the Great Recession and that corporate concentration, wealth
inequality, and lax regulation are still issues that need addressing. Do they think she’s 100
percent right on everything? No. But they know she’s smart, and they think she’s
approaching policy with a scalpel, not a sledgehammer. They believe Warren when she
says she is a capitalist and are on board with her brand of capitalism.
“A place like mine chooses winners economically,” said a Goldman Sachs vice president. “Is
that right? It doesn’t seem like that is right.”
I spoke with more than three dozen people from across the financial sector —
professionals who work at hedge funds, big banks, and private equity funds, in asset
management, financial advice, investment banking, trading, research, and compliance —
who support Warren’s presidential bid. They know if she lands in the White House that may
make their jobs a bit different, their companies a little less lucrative, or mean they’ll pay
more in taxes. And they think that’s great. They support Warren because of her policies,
not in spite of them.
“Even though, on a personal basis, Elizabeth Warren may be bad for me economically, she
would be better for society, which I want my kids to grow up in,” a director at Citi told me.
Elizabeth Warren’s “plan for that” appeals to a lot of people on Wall Street
Warren’s plans have become a signature of her presidential campaign. She’s got a lot of
them, including multiple that would have a significant impact on the financial industry,
major corporations, and the wealthy.
She has laid out proposals to overhaul private equity, restructure American capitalism,
jail corporate executives, implement a lobbying tax, and get big money and donors
out of politics, among others. She says that her first priority, if elected, will be a sweeping
anti-corruption package that would seek to reduce corporate influence and the sway of
special interests in Washington, DC.
“Corruption has put our planet at risk. Corruption has broken our economy. And corruption
is breaking our democracy,” Warren said at a September rally in New York City. “I know
what’s broke, I’ve got a plan to fix it, and that’s why I’m running for president of the United
States.”
Many of the people I talked to said that the big structural change Warren talks about and
her plans — even the ones that might not be best for their pocketbooks — are what draw
them to her. They believe that parts of their industry, or other parts of the political system
as a whole, need changing.
“I might not always agree with every move that she makes, but it would be hard to argue
that she hasn’t done her homework on it,” said Charlie O’Donnell, a venture capitalist at
Brooklyn Bridge Ventures.
That’s also why some Wall Streeters are so concerned about her. They know how the
system works and they know she knows, too. When billionaire Leon Cooperman goes on
CNBC and predicts a Warren presidency would cause the stock market to fall by 25
percent, he’s not just thinking of his stock portfolio — he’s also thinking of his bank account
and what Warren’s wealth tax would mean for that, or how aggressive Warren-installed
financial regulators would be.
Senate Minority Leader Charles Schumer and Sen. Elizabeth Warren at a news conference about tax cuts at the Capitol on October 18, 2017.
| Tom Williams/CQ Roll Call
While a lot of Warren’s Wall Street supporters felt their particular firms or areas are doing
things right, they think a lot of others in corporate America are doing things wrong. The
hedge funders wondered about the big banks; the private equity people complained about
monopolies and the bank bailouts. An investment adviser said he was doing right by his
clients but his competitors were engaging in behavior he considers “borderline criminal.”
The Dodd-Frank Act had already cleaned up the big banks, but what about Big Tech?
“I’m not so worried that we’re going to blow up the financial system,” said one junior
executive at a large quant hedge fund. “I’m worried that banks aren’t very good at deciding
who is and who isn’t going to blow up the financial system. So if she wants to regulate
them more, I’m not going to complain.”
O’Donnell invoked the debacle surrounding WeWork, the coworking startup that was
forced to cancel its IPO and saw its CEO and founder step down, but not before cashing
out $700 million from the company and reportedly walking away with nearly $2 billion
more. “That’s not capitalism, that’s just theft,” O’Donnell said. “And I’m not for theft. If
that’s the kind of reform that Warren puts in, that’s great, that’s awesome, that’s better for
everybody.”
There was also a sense among those I talked to that if you can’t make money under
Elizabeth Warren’s rules, maybe you’re not very good at the game in the first place. Wall
Street has its egos, and there’s an attitude that they don’t need the government’s help to
make money.
“To the extent that a business was regulated out of existence, isn’t that the ultimate form
of capitalism?” said one New York investment banker. “If your business can’t succeed, it
should die.”
“The truth of the matter is, I don’t need the government’s help to make money doing what
I’m doing,” a private equity executive said.
Warren’s Wall Street supporters trust her

Warren has made a point to emphasize that she’s a capitalist and that she doesn’t want
to destroy markets altogether, she just thinks they need rules. And her supporters in the
industry agree with her.
“I can convince myself that it is a service we provide — we are effectively taking on risk
where other people don’t want to,” said an associate director in the high-frequency trading
division of an options firm. “But it’s a long way to convince myself that it’s a net gain for the
world.”
“Customers need protection. Corporations have so much at their disposal and an individual
customer has nothing,” said a portfolio manager in the credit card division of a major bank.
One managing director at JPMorgan Chase acknowledged that the commercial banking
sector had been “beaten and pounded” by the Consumer Financial Protection Bureau,
which Warren first conceived of as a Harvard professor and helped launch during
President Barack Obama’s administration, and it wasn’t the end of the world. “I don’t want
to say we got used to it, but we adapted,” he said. “We survived, and we’re now more
profitable than ever.”
Warren speaks during a protest in front of the Consumer Financial Protection Bureau headquarters in Washington, DC, on November 28, 2017.
| Mark Wilson/Getty Images
Warren’s Wall Street backers don’t buy into the notion that she will tank the stock market
or do catastrophic damage to the economy. Instead, they think her formula works in the
long term, and the Trump-induced whiplash is more detrimental.
“If there’s any kind of correction associated with a Warren presidency, I think it would
actually be short-lived,” said a Fidelity portfolio manager. “So much of Wall Street is
Republicans, and if it is conventional wisdom that it’s going to be a shit show, then that
does become self-fulfilling for a period of time. But ultimately, what will matter is the
economic data and company results.”
Supporters also trust her in the event of a potential recession. They see her as an
experienced economic hand who would seek to spend more money at the lower ends of
the economic spectrum rather than at the top, and they assume the deficit is going to
continue to balloon whoever the next president is, Republican or Democrat. “At the macro
level, the redistribution of wealth back into consumer’s pockets will positively impact
equity markets,” said a State Street vice president. “It’s just what side of the ledger you
want to look at.”
While in the wake of the financial crisis, Warren trained much of her ire on the big banks; on
the campaign trail, she’s specifically gone after private equity. She’s characterized the
industry’s practices as “Wall Street looting,” invoking private equity’s role in the demise of
companies such as Toys R Us, Payless, and Shopko, and proposed revamping the way
firms do business and closing the carried interest tax loophole many in the field take
advantage of.
Finance professionals not in the private equity industry said they had it coming, and her
supporters within the industry said that while the attention was a bit of a nuisance, on a lot
of fronts she was probably right.
The day I spoke to one private equity associate, he told me he had just been at an industry
conference where the speaker had dedicated part of his presentation to Warren. “They
framed it as private equity has a public relations problem and we as an industry should try
to show that we are not as bad as we are sometimes portrayed to be,” he said.
“At the end of the day, it’s hard to justify why these things exist and everybody knows it,
they just don’t want to pay it,” one private equity executive said of the carried interest tax
loophole.
In a statement to Vox, Warren spokesperson Saloni Sharma highlighted Warren’s record on

going after the financial industry, including her calls to break up the banks, her work setting
up the CFPB, and her public criticism of Wells Fargo and its executives. “She is not cozying
up to Wall Street at fundraisers,” Sharma said. “She’s been the leader in holding Wall Street
accountable and getting results for decades. They know she will do the same as
president.”
Not everyone in finance is rolling in money

Miles’s law says that where you stand depends on where you sit, and not everybody is
sitting in the same place in the world of Wall Street. The prospect of an Elizabeth Warren
presidency means something very different to the Lloyd Blankfeins and Jamie Dimons of
the world from what it means to your average Goldman Sachs or JPMorgan employee.
“It’s a pyramid, and the people at the top are very wealthy and everybody else is trying to
rise to the top,” said one hedge fund portfolio manager.
One compliance officer at a major investment bank recalled a pep talk her boss used to
give at meetings at her previous firm. “His metaphor was how much juice can you squeeze
from a lemon? Because if you squeeze it a little bit more, you can always get more out of it.
I really do feel like a lemon,” she said.
In her current position, she went for seven years without getting a raise. “It’s very hard to
take when you know that the company just initiated a $100 million stock buyback and we
have one of the highest-paid CEOs on Wall Street,” she said.
People walk outside of the New York Stock Exchange in New York City on May 29, 2018. | Spencer Platt/Getty Images
And it’s not just problems with how their companies sometimes treat them, it’s also with
how they treat consumers.
A mortgage specialist who works for a Wall Street bank — Wells Fargo — not on Wall Street
but in Iowa told me about his dealings with an elderly couple who had a home they couldn’t
afford. They were unable to pay for the repairs required in order to turn it over to the
government and Wells Fargo was unwilling to foot the bill for the repairs itself. The house
will probably be foreclosed on and the couple has moved into an assisted living facility. “We
are making billions upon billions of dollars a year, and for us to quibble over thousands of
dollars on a property is tough for me to swallow,” the employee said.
He caucused for Republican Marco Rubio in 2016. He plans to caucus for Warren this time
around.
One of the most headline-grabbing proposals of Warren’s presidential campaign thus far
has been the wealth tax. She wants to levy a 2 percent tax on fortunes of over $50 million
and a 3 percent tax on fortunes of over $1 billion. One Deutsche Bank economist laughed
off the idea that this would affect broad swathes of Wall Street. There are a lot of people
who might envision themselves as the real-life Gordon Gekko, but very few actually get
there. “There’s something very aspirational about pretending that you’re going to be
impacted by the wealth tax,” he said.
But even if they did hit the $50 million net worth mark, the Warren supporters I talked with
said they would be fine. “If the prospect of losing 2 percent of your wealth would get you to
let Trump win, did you ever have any principles at all?” said one researcher at a major
hedge fund.
One trader was more cutting in his assessment: “I’m fully on board with soaking the rich,
100 percent, and if that involves me paying more taxes, let’s go.”
Warren has a lot of supporters on Wall Street, but they’re still not shouting it from
the rooftops
Many of the people I spoke with for this story were leery about announcing their political
leanings, and it makes sense. Corporations don’t want to risk alienating customers and
clients of any political stripe, and typical workplace politeness can keep politics talk to a
minimum. Some people knew many others at their workplaces who agreed with them on
Warren, but they also knew people who disagreed.
At many financial companies, employees face strict rules around campaign contributions
and have to get them cleared by compliance, if they’re allowed at all. Brent Jerolimic, now a
consultant at a fintech company, waited until leaving his job at UBS before donating to
Warren’s campaign. “I didn’t necessarily need that on my record, that I donated to Liz
Warren,” he said.
Warren campaigns at a town hall event on the Student Union Lawn at Keene State College in Keene, New Hampshire, on September 25, 2019.
| Barry Chin/The Boston Globe via Getty Images
Warren may not be the most popular candidate on Wall Street, but she’s not the least
popular one, either; it’s not as though the financial industry is immune to her rise in the
polls. And her supporters acknowledge that while not everyone in their field will agree with
them, they want them to give her a chance.
They believe that if people sit down and actually look at her policies, they will see she’s not
going to turn the United States into Venezuela. The big structural change she’s talking
about, they think is a good thing. And presidents don’t get everything — or often most
things — on their agendas done. They’re not scared, and they don’t think others in their
position should be scared.
A director at Bank of America Merrill Lynch said he’d seen all the stories about Wall Street
loathing Warren and reached out to show that it’s not everyone. “There are some of us who
think that fairness is important and not just maximizing how much money I have,” he said.
And if their colleagues or those higher up on the totem pole aren’t on board with Warren,
well, that’s just too bad.
“My old bosses were good guys,” said Tamar Katz, a former analyst at Citi. “I see that they
don’t get Elizabeth Warren, and they’re wrong.”
Just because Warren’s backers don’t announce their political preferences doesn’t mean
they aren’t listening. A private equity associate told me he had heard the CEO of a major
private equity firm refer to Warren as “Pocahontas” at a reception during a 2018
conference. A research analyst told me that this spring he had been present in a meeting
where an investment relations director from a major defense contractor joked about
getting Warren and Rep. Alexandria Ocasio-Cortez (D-NY) onto a Bombardier jet, the laugh
being because it would crash and they would die.
“I have yet to be at a dinner or a luncheon or a meeting where she does not come up
among these wealthy fund managers or CEOs,” he told me. “Publicly, they may dismiss her
as a socialist with no chance. Privately, I think it’s keeping them up at night.”
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10/23/2019 Elizabeth Warren has a lot of supporters on Wall Street over Trump - Vox

The Wall Streeters who actually like

Warren’s Wall Street supporters trust her

In a statement to Vox, Warren spokesperson Saloni Sharma highlighted Warren’s record on

Not everyone in finance is rolling in money

What really happened in Syria over the past 24 hours, explained

POLITICS & POLICY

House Republicans’ impeachment stunt is an attempt to distract from the

POLITICS & POLICY

View all stories in Politics & Policy

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