By Greg Ip and Ken Thomas 

Former Vice President Joe Biden is running for president on the sort of platform that usually makes business sweat: higher taxes on corporations and investors, aggressive action to phase out fossil fuels, stronger unions and an expanded government role in health care.

Yet many business executives and their allies are greeting the prospect of a Biden presidency with either ambivalence or relief. Credit that not to who Mr. Biden is, but who he isn't: Elizabeth Warren or Bernie Sanders, senators with a much more adversarial approach to business who lost to Mr. Biden in the Democratic primary, or President Trump, whose administration has been marked by economic-policy unpredictability.

"If Elizabeth Warren or Bernie Sanders were the nominee, we'd be having a very different conversation and thinking through our engagement in a very different way," said Tim Adams, president of the Institute of International Finance, which represents global banks. "With Biden, what you have is someone who in many ways is a throwback to a different era, who thinks about, 'How do you get things done?' "

Asked how Mr. Biden would deal with business, his allies describe him as pragmatic. "Joe Biden is driven less by the politics of the moment and more by which policies he believes will be most effective in lifting up the middle class," said Jared Bernstein, an economist who served under Mr. Biden when he was Barack Obama's vice president, and still advises him.

What some call pragmatism looks to others like an absence of any ideological anchor, making it hard for outsiders to predict what side he will take on any given issue.

"Biden has impulses, not ideas," said Michael Strain, head of economic policy studies at the right-of-center American Enterprise Institute. "He instinctively favors the little guy" which, he said, could yield policies that align him either with the party's left wing or its centrists. For many business leaders, the worry is less Mr. Biden himself than that he may be pulled left by his party. "I'm not sure exactly what he believes in," said one former Fortune 500 chief executive.

For Mr. Biden to raise taxes, implement his most ambitious climate policies or add a public health-insurance option to Obamacare, Democrats must both retain control of the House of Representatives and win control of the Senate.

That prospect doesn't seem to have bothered the markets so far. Stocks have remained buoyant, in part on expectations that a unified Democratic government means more fiscal stimulus. Several private forecasters, including Moody's Analytics and Goldman Sachs, estimate a Democratic White House and Congress would lead to faster economic growth than otherwise, though some see him adding more debt, as well. Some conservative economists disagree, predicting Mr. Biden's planned tax increases on corporations, big banks, high-income households and assets would reduce the incentive to work, save and invest, curtailing future output.

In a survey of about 100 CEOs who attended a Yale School of Management conference in September, 77% said they planned to vote for Mr. Biden. Many also are voting with their wallets. Roger Altman, founder of investment bank Evercore Inc. and a top Democratic fundraiser on Wall Street said, "Raising money is never easy. But raising money for Biden by historical standards has been very easy." The Biden campaign raised nearly $750 million in August and September, a record for any presidential candidate.

Financial industries have contributed more than $50 million to Mr. Biden's campaign and outside groups supporting him, more than any other business sector, according to the Center for Responsive Politics. His top donors include Hollywood producer Jeffrey Katzenberg, LinkedIn co-founder Reid Hoffman, and venture capitalist Chris Sacca.

Business isn't monolithic, and political attitudes vary considerably by industry and type of business. Of the political donations flowing to Mr. Biden, Mr. Trump or to outside groups supporting them, 81% of those from the securities and investment industry went to Mr. Biden, while 81% from energy and natural resources went to Mr. Trump. The data, compiled by the Center for Responsive Politics, covers reported donations through mid-October. Small-business owners have tended to be much more supportive of Mr. Trump than the CEOs of multinationals, such as those who answered the Yale survey.

Andy Laperriere, a policy analyst at Cornerstore Macro, a brokerage firm, suggested in a note to clients that expectations a Biden presidency will be good for stocks are "wishful thinking." In another report, he wrote: "Democrats have made clear they want to take from the 1% and make the economy fairer to average workers. It's unlikely the 1% (which includes corporations, by their way of thinking) are going to be left better off under those circumstances."

Mr. Biden's plans would cost $7 trillion to $12 trillion over a decade, according to the Committee for a Responsible Federal Budget, a nonpartisan watchdog group.

Mr. Biden has tried to assuage business leaders even while promising to transform the nation with one of the most progressive administrations since Franklin D. Roosevelt. At a fundraising event at New York's Carlyle Hotel in June 2019, he made soothing overtures to the Wall Street financiers in attendance.

"Remember I got in trouble with some of the people on my team, on the Democratic side, because I said, 'You know what I've found is rich people are just as patriotic as poor people,' " Mr. Biden said. "You all know in your gut what has to be done. 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 will change. Nothing would fundamentally change."

The remarks drew criticism from the party's progressive base. Still, Mr. Biden has continued to say similar things.

"I come from a corporate capital of the world, Delaware, and I'm not anticorporate," he said on CNBC in May. An edit to a speech to supporters in Phoenix earlier this month. was telling. The prepared text read: "You're the ones who actually built this country, not the Wall Street robber barons or CEOs." When he delivered the remarks, he replaced "robber barons" with the more anodyne "bankers."

Jake Sullivan, senior policy director for his campaign, said: "Joe Biden is a capitalist through and through."

Through a spokesman, Mr. Biden declined to comment for this article.

Mr. Biden has been close to unions since his first Senate campaign in 1972, and they have contributed $14 million to his campaign and supporting groups. Strengthening their hand with employers is one plank in his platform. Marc Perrone, international president of the United Food and Commercial Workers International Union, said labor hopes for more worker-friendly policies and a tougher Occupational Safety and Health Administration in a Biden administration. But, he added: "I think he'll have an administration that listens to both sides."

Mr. Biden is regularly briefed by a team that includes progressive economists such as Mr. Bernstein and Heather Boushey, head of the Washington Center for Equitable Growth, a left-of-center think tank, and more moderate figures such as Ben Harris, an economist at Northwestern University's Kellogg School of Management and an adviser to Mr. Biden when he was vice president. The economic-briefing process is overseen by Mr. Sullivan, a former national security adviser to Mr. Biden and foreign-policy hand to Hillary Clinton, and campaign policy director Stef Feldman, who was an aide to Mr. Biden as vice president.

Ms. Warren and Mr. Sanders had proposed the wealthy pay a percentage of their wealth each year in tax. People familiar with Mr. Biden's campaign said he ultimately rejected a wealth tax, not out of ideology but practicality. Rather than create a completely new tax, he figured he could raise revenue by raising the tax rate the rich pay on capital gains to that of ordinary income, and eliminating a provision that shields large asset bequests by the wealthy from capital-gains tax.

During the primary, Mr. Biden set a goal of net-zero carbon emissions for the economy by 2050, much less ambitious than Mr. Sanders, who targeted net zero for power and transportation by 2030. After Mr. Biden defeated Mr. Sanders, representatives of the two sides hammered out a single "unity" platform that retained Mr. Biden's 2050 overall goal and added an interim goal of net-zero emissions in electricity by 2035.

On paper, Mr. Trump's policies are more business-friendly than Mr. Biden's: He has cut their taxes, weakened regulations, particularly climate-related rules, and put light-touch regulators in charge of agencies overseeing consumer protection, banking and the workplace.

Some of the goodwill generated with business by those policies and appointments, though, has been eroded by his trade actions against China and U.S. allies and the atmosphere of division and chaos that accompanies his economic decisions.

Lloyd Blankfein, former chief executive of Goldman Sachs Group Inc. and a Democrat who was critical of both Mr. Sanders and Ms. Warren, tweeted last month: "So far the stock market doesn't seem too upset at the prospect of Biden winning, despite Trump's more market-friendly policies. Perhaps folks think their stocks and 401(k)s will do better with higher taxes and increased regulation than with nastiness and scorched earth."

Given their uncertainty over Mr. Biden's core ideology, business leaders are eager to know whom he will appoint to key positions should he win. Mr. Biden has said he doesn't intend to name any potential cabinet nominees until after the election.

Liberals in the party would like to see Ms. Warren receive a plum role in a Biden administration, along with progressive stalwarts in Congress such as Pramila Jayapal (D., Wash.), and Katie Porter (D., Calif.). Liberal groups have also promoted Columbia University economist Joseph Stiglitz as a potential head of the National Economic Council.

Wade Randlett, a Biden fundraiser who is an executive at General Biofuels, a California-based alternative-energy company, said progressives probably overstate their leverage with Mr. Biden given that they didn't support him during the primary and "repudiated him and his ideas all the way."

CEOs, who were prominent in Mr. Trump's first cabinet, are largely absent from Mr. Biden's inner circle, although many close aides have worked in the private sector, often as lobbyists.

Business leaders say Ms. Warren as Treasury secretary is the sort of appointment that would alarm them. People close to the campaign say that is unlikely, not least because it could cost Democrats a seat in a closely divided Senate, at least temporarily, because the state has a Republican governor who would choose an interim replacement.

Among the potential picks for Treasury are three current or former Federal Reserve officials, say people familiar with the campaign. Lael Brainard, currently a Fed governor who served under both Mr. Obama and President Clinton, and Roger Ferguson, chief executive of fund manager Teachers Insurance and Annuity Association of America and a former Fed vice chairman, would both be reassuring figures, business leaders say. Sarah Bloom Raskin, a favorite of liberals and a former Fed governor who served in Mr. Obama's Treasury, is more of an unknown to business.

Energy companies are resigned to more climate regulation in a Biden administration, said Kevin Book, head of research at ClearView Energy Partners, an energy analysis firm. In Thursday's final debate, Mr. Biden said he would "transition away from the oil industry." Yet much will depend on who fills key positions such as Environmental Protection Agency administrator. Mr. Book pointed to Gina McCarthy, who headed the EPA under Mr. Obama and has advised the Biden campaign, as someone the industry felt listened even if they didn't like her decisions. People close to the campaign said Mary Nichols, chairwoman of the California Air Resources Board, is sometimes floated by Democratic operatives as EPA administrator.

Mr. Book said she would worry industry because she has "unflinchingly supported" the state's "interventionist, heavy handed agenda." A spokesman for Ms. Nichols declined to comment.

Business may be less out of step with a Democratic agenda than it once was. In the past decade, many executives, like the country at large, have moved in Democrats' direction on noneconomic issues such as immigration, race, gay and transgender rights, and climate. Last month, the Business Roundtable, representing more than 200 big-company CEOs, endorsed reducing U.S. net carbon emissions 80% by 2050 -- a position closer to Mr. Biden's than Mr. Trump's.

Some business leaders see the current climate of polarization as antithetical to policy-making. From infrastructure to skill development, "there's a long list of things we need resolved, and we're just spinning our wheels in the twittersphere, and it's time to get back to work," said the Institute of International Finance's Mr. Adams, who served in President George W. Bush's Treasury Department. "Let's make America, or at least Washington, boring again."

Write to Greg Ip at greg.ip@wsj.com and Ken Thomas at ken.thomas@wsj.com

(END) Dow Jones Newswires

October 25, 2020 13:21 ET (17:21 GMT)

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