July 19, 2024

Trump and Biden’s Economic Pitches: A Tale of Two Strategies for Business

Trump and Biden: Diverging Visions for Corporate America

The Trump campaign and the Biden administration presented their contrasting visions to business leaders on Thursday, emphasizing their differing approaches to corporate America ahead of the upcoming election.

Both leaders aimed to appeal to the business community, albeit with markedly different strategies, during a day filled with political activity in Washington, D.C., and New York.

Trump’s Engagement with CEOs

Donald Trump convened with top CEOs in Washington, focusing primarily on tax reform. The former president, interviewed by his former economic adviser Larry Kudlow, addressed an audience that included prominent figures like Jamie Dimon of JPMorgan Chase (JPM), Tim Cook of Apple (AAPL), Brendan Bechtel of Bechtel, and Doug McMillon of Walmart (WMT).

A CEO in attendance noted that Trump did not introduce new details about his 2025 plans but rather highlighted his record on taxes, regulation, and inflation, comparing it favorably to Biden’s tenure. Despite Trump’s attacks on Biden, the CEO felt the session did little to sway business leaders’ overall views, many of whom remain undecided between the two extremes represented by Trump and Biden.

Trump’s visit included meetings with House and Senate Republicans to strategize for the upcoming election, marking his first visit to Capitol Hill since his departure from office and the events of January 6, 2021. He summarized his day with a call to action, emphasizing the need for electoral victory to instigate change in Washington.

Biden’s Representation

While President Biden was in Italy for a G7 conference, White House Chief of Staff Jeff Zients represented him before the CEOs, interviewed by Comcast (CMCSA) CEO Brian Roberts. Zients discussed various topics including investments during Biden’s term, inflation, and immigration, and praised the contributions of CEOs like Bechtel and McMillon who have collaborated with the White House.

Treasury Secretary Janet Yellen also addressed New York business leaders, outlining a vision for a second Biden term that emphasizes government intervention to support business and stimulate private sector investments. Yellen reiterated Biden’s commitment to ensuring businesses pay their fair share of taxes, a key component of his re-election platform.

The Tax Debate

Taxes emerged as a critical issue, with many CEOs focused on the impending expiration of key provisions in Trump’s 2017 tax cuts at the end of 2025. Trump met with members of the Business Roundtable, led by Cisco (CSCO) CEO Chuck Robbins, and Procter & Gamble (PG) CEO Jon Moeller, who chairs the group’s tax and fiscal committee.

The Business Roundtable emphasized the need for tax reforms to maintain global competitiveness and expressed willingness to invest over $10 million in advocating for these changes. Despite some reservations about Trump’s tariff proposals, the group largely supports his tax policies.

Trump’s plans, centered on extending and potentially expanding his 2017 tax cuts, were a focal point of his meetings with House Republicans, Business Roundtable CEOs, and Republican senators. House Speaker Mike Johnson highlighted the party’s intent to swiftly extend these tax cuts through reconciliation if they achieve unified control of the government.

Biden’s Economic Approach

In contrast, the Biden administration promotes a more active government role in supporting businesses. Yellen, Zients, and Lael Brainard, Biden’s top economic adviser, communicated this approach, emphasizing modern supply-side economics that focus on broad-based benefits for workers, families, and businesses.

Biden’s successes, such as the 2021 CHIPS and Science Act, which revitalized the semiconductor industry, and the 2022 Inflation Reduction Act’s electric vehicle tax credits, were highlighted as examples of effective government intervention.

However, the Biden administration’s stance on taxes has been less appealing to business leaders. Cisco’s Robbins expressed concerns about reversing tax cuts, underscoring the tension between Biden’s tax policies and corporate interests.

Conclusion

The contrasting approaches of Trump and Biden present a clear choice for the business community. Trump’s focus on extending tax cuts and reducing regulations appeals to those prioritizing lower taxes and minimal government intervention. Meanwhile, Biden’s emphasis on government support and tax fairness aims to foster a more equitable economic environment. The business community’s response to these pitches will play a crucial role in shaping the economic landscape in the coming years.

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