Wall Street is dancing a jig. Donald Trump will likely soon be gone from the Oval Office, and the money men in New York are fine with the embers of Trumpism: a Republican Senate—although we won’t know for sure until January, after the two runoffs in Georgia—and political gridlock in Washington. “Wall Street will love it,” one senior Wall Street banker tells me giddily. “Are you kidding me? A growth agenda without overburdensome regulation or tax reform? C’mon. Are you kidding me? Fucking they live for fucking gridlock.”
Another longtime Wall Street banker, who’s been hoping for gridlock, tells me about the conversation he had two weeks ago with a former U.S. senator who served with Joe Biden in the Senate. “There’s a large part of Joe that, if he wins, he hopes the Senate does not flip,” he says the former senator told him. He said Biden worried that during the primaries, the progressive wing of the Democratic Party had pushed him too far to the left and that with a Republican Senate, “for anything to be accomplished means that the leadership of the Republican Senate has to come to the table with him, which he’s very comfortable with, because that’s how he spent his entire career, just navigating the middle ground. In a strange way he’s more comfortable having a Republican Senate than a Democratic one.”
That’s Wall Street’s happy place too. The Dow Jones Industrial Average is up some 5% since Election Day, a sign that investors like the prospect of less daily chaos and a return to some degree of normalcy. There is also a sense that early Biden policy initiatives will be both much-needed—a genuine, science-based plan to deal with the COVID health crisis, a new stimulus package, an infrastructure program, and a return to the Paris climate accord—and tempered by having to reach agreement with Senate Republicans. That also is likely to mean less of a tax increase on the wealthy and on corporations and a compromise on a return to tougher regulations. All of which makes Wall Street smile. “The Senate Republicans won’t allow any progressive stuff to get through,” the longtime Wall Street banker continues. “[Higher] taxes—they can’t get it through if the Senate stays Republican. It takes a lot of pressure off Biden, and also gives him the opportunity to do what he thinks he does best, which is sit down at the negotiating table and go through the compromise process…If the Senate stays red and Biden’s in the White House, they’ll be unable to raise our taxes, they’ll be unable to roll back the regulatory relief. And so, that’s not a bad scenario. Two weeks ago it was about the prospect of a huge stimulus bill. Now it’s: ‘Hey, with a divided Congress and Biden as president, nothing that we really don’t want that’s bad can happen.’”
For a reality check, I called The Mooch, a.k.a. Anthony Scaramucci, the hedge fund manager and short-lived Trump communications director turned leading Trump apostate. He reminded me of our conversation in January, from Davos, where he predicted Trump would lose the election because most people in Davos thought he would win. “I based it all upon the fact that there is something wrong with him mentally and that he would do something to self-sabotage or destabilize himself, which is exactly what he did,” he says. He sees Trump as a tragic figure. He thinks when the counting is done, Trump will end up with some 73 million votes. “He’ll have a higher vote total than Barack Obama in 2008,” he says. “So you can’t tell me that this is not a talented political figure. But what you can tell me is that he is the Lyndon Johnson of our times. Despite his talents as a political figure, his self-loathing and his lack of self-confidence in dealing with experts, as an example, was his undoing.” Had Trump embraced the doctors and scientists on COVID, The Mooch says, and dealt with the medical crisis honestly, instead of pretending it would go away, “he would have won in a landslide.” But, he continues, “he’s not capable of doing that, and so the self-loathing, the lack of empathy, the personal invective, victimization, chip on the shoulder, ‘everything’s gotta be about me’” proved to be his political undoing.
The Mooch then brings me back inside the Trump White House. He tells me that H.R. McMaster, Trump’s second national security adviser, called Trump “reflexively contrarian,” which is Pentagon-speak for someone who has to “steamroll you” and always prove that he is smarter than you. “If McMaster told him we should do A, Trump would look at him and say, ‘Okay, listen. I’m way smarter than you. I know you have a degree and you can speak in full sentences, but we are doing Z.’ ‘Why are we doing Z, Mr. President?’ ‘Well, I have to prove to you that you were wrong, and we’re going to do it my way.’ You see what I mean? He can’t listen to anybody. He can’t take any advice from anybody. It was a one-run-on-sentence stream of consciousness the whole way.” (McMaster and Scaramucci discussed Trump’s style a couple weeks back.) “This is a tragic story of incompetence mixed in with demagoguery. You’ve heard me say this. If Joe McCarthy and Charles Lindbergh got together and had a test tube baby, and the baby got baptized by Father Coughlin, and the nanny for the baby was Roy Cohn, that’s what we got.”