Why Wall Street picked Kamala Harris

Robert Armstrong (0:09)

James, you're a Deals reporter. How did you end up writing about politics all the time?

James Fontanella-Khan (0:14)

I've been asking myself that question too. It all started about a month ago, when I was in the office watching the debate, and as I was kind of witnessing the meltdown of Joe Biden against Trump, I started just texting my sources, and people who I knew were generally pro-Biden.

Robert Armstrong (0:38)

Wall Street type, steel makers.

James Fontanella-Khan (0:39)

Yeah, Wall Street guys, the guys. And I was like asking, so do you still think this guy can win? And it was like, shock. And I started feeding a couple of lines to our blog, and from that point onwards, I kind of realized that all the people I write about, who talk to me about M&A, are actually pulling a lot of strings.

Robert Armstrong (1:00)

Yeah, it's a horrifying truth about America, that money and politics are often the same thing.

James Fontanella-Khan (1:07)

It couldn't be more true.

Robert Armstrong (1:10)

This is Unhedged, the markets and finance podcast from the FT and Pushkin. I'm Rob Armstrong, coming to you from New York City. My interlocutor today is James Fontanella-Khan, who is our US. Deals reporter, and now our junior politics reporter. James, welcome to the show.

James Fontanella-Khan (1:32)

Thanks for having me again.

Robert Armstrong (1:33)

Right, so we had the mortifying debate performance. What did Wall Street do next in response to that disaster?

James Fontanella-Khan (1:43)

A lot of Wall Street guys are historically Democrats. I mean, they're kind of very conservative on finance and economic matters, but on social matters, they're more kind of blue.

Robert Armstrong (1:54)

Yeah.

James Fontanella-Khan (1:55)

And so immediately there was a sense of like, we got to remove this guy.

Robert Armstrong (1:59)

Get rid of Biden, he's got to go.

James Fontanella-Khan (2:01)

And Harris wasn't an obvious kind of pick for anybody, although she has always had a fairly tight report with people on Wall Street. Not very advertised, but these again are the people I talk to quite regularly. The founders of some of the larger boutique investment bank think about Evercore, Centerview, some of the biggest law firms think about Paul Weiss, for example. And essentially you have, on the one hand, the West Coast talking about, we got to remove him, we got to have primaries, they're talking about a number of potential candidates.

Robert Armstrong (2:34)

Yeah, the Hollywood money was like, this is going to be a great TV show.

James Fontanella-Khan (2:37)

Exactly.

Robert Armstrong (2:38)

We're going to have a circus with...

James Fontanella-Khan (2:40)

Oprah was going to do a couple of interviews to see how the candidates featured in difficult situations.

Robert Armstrong (2:46)

Right.

James Fontanella-Khan (2:48)

Much more silent was people on Wall Street. And I was pushing them to try to speak up, say what they thought about it, be a good little scoopette for this new political reporter.

Robert Armstrong (2:59)

Yes.

James Fontanella-Khan (3:00)

And they said, no, no, this is not how we operate. And they operated exactly how they operate on a deal. Behind closed doors, putting pressures on the likes of Schumer, the Senate leader for the Democratic Party, on Hakeem jeffries in the House. And I think a couple of days before Biden stepped down, I wrote a story saying essentially, Wall Street has made it clear there's no more money.

Robert Armstrong (3:24)

As long as it's Biden.

James Fontanella-Khan (3:26)

Yeah, he either stepped down or he's done. But more interestingly than that, they already had a plan for Harris to be the person to replace him. They thought the idea of having a mini primary was like terrible. They were very scared of potentially the party moving even further left.

Robert Armstrong (3:45)

Yes.

James Fontanella-Khan (3:45)

Like Wall Street has been complaining for the longest time of Biden's shift to the left, especially on antitrust and being kind of generally perceived as anti-business.

Robert Armstrong (3:58)

Yes. I know this is impossible to answer with certainty, but when the money spoke, was the decision made? In other words, was it determinative that Wall Street said, we'll cut you off unless we have a new candidate?

James Fontanella-Khan (4:14)

I'd like to say 100% yes. I'll say 99.9, because you can never be... so definitive, but we went out with a story on the Friday saying he's going to leave this weekend and he left.

Robert Armstrong (4:25)

Yes.

James Fontanella-Khan (4:26)

And what was fascinating though is how capable these guys, mainly guys, on Wall Street were to kind of also plan the next steps.

Robert Armstrong (4:36)