Biden Targets Big Business and Billionaires

by

President Biden sought to reinvigorate his re-election campaign, delivering an animated and mostly gaffe-free State of the Union address that put the economy and business front and center.

In the prime-time slot, he pitched Bidenomics as delivering for Americans and outlined a policy wish list that may appeal to progressive voters and some in his party but which could also put him at loggerheads with big corporations.

Heading into a November rematch with Donald Trump, Biden sought to frame the presidential race in stark terms for the democracy while holding business to account.

Among the areas that could rankle business leaders: a call to raise the minimum tax on multinationals to 21 percent. This move would seem to target pharmaceutical companies in particular. He also singled out “Big Oil, private jets, and massive executive pay” in his speech as areas ripe for boosting tax revenue.

Biden’s proposals go against the heart of some Trump-era policies, and that’s not going down well with some business groups. Neil Bradley, the U.S. Chamber of Commerce’s chief policy officer, said the Biden plan “would actually result in lower economic growth, fewer new business starts, less job creation, and fewer choices for American families.”

Biden stressed the sharp contrast with Trump. The president has struggled to convince Americans that Bidenomics is helping them, despite big industrial policy decisions like the Inflation Reduction Act and action to contain last year’s regional banking crisis.

Biden, who trails in some polls — but is cleaning up with donors — said he “inherited an economy on the brink” in 2021: It’s now outperforming most advanced economies on a range of indicators.

Here are some of the big moments from Biden’s speech:

  • Biden pumped his record on jobs, wage gains, and investments. He pointed to the effects of his signature legislation, including the inflation reduction, infrastructure and CHIPS and Science acts. “My policies have attracted $650 billion of private sector investments in clean energy and advanced manufacturing creating tens of thousands of jobs here in America,” he said. (Fact checkers say that figure needs some context.)

  • He took on the Achilles’ heel issue of inflation. Biden again promised to go after companies for price gouging, shrinkflation and junk fees, noting that price rises are trending down. (And they are, although more slowly in recent months.)

  • Biden wants to raise taxes on big business and billionaires. Such measures would be a long shot with the Republicans controlling the House. Biden added that getting the rich to pay more tax would help reduce the deficit.

  • He signaled his union ties. Biden mentioned his “great friend,” Shawn Fain, the U.A.W. president who attended the joint session of Congress. Both Biden and Trump are courting the unions, a key voting bloc in battleground states like Michigan.

  • Biden also made a big pitch to women. A Catholic, Biden threw his support behind reproductive rights and the availability of in vitro fertilization. He predicted that the overturning of Roe v. Wade would catalyze the women’s vote.

Trump hit back on his Truth Social platform. Outages on the social media site during the event hamstrung the former president’s efforts to deliver a rolling commentary. But he did get in a few broadsides about inflation and border security.

The State of the Union is usually a ratings winner. And judging by the response on social media, last night’s roughly 67-minute speech was another closely followed affair.

Wall Street is focused on Friday’s jobs report. Economists have forecast that employers added 200,000 jobs last month. That would be a decline from January’s blockbuster report, but would still point to a healthy labor market. The Fed will be tuning in to the wage-growth data as it mulls its next policy decision. The central bank is “not far” away from cutting interest rates, its chair, Jay Powell, said on Thursday.

Banking and business lobbies take on the government over a credit-card fee rule. Trade groups and the U.S. Chamber of Commerce sued the Consumer Financial Protection Bureau over a new rule that would cap late fees at $8 per month, in the latest clash between the banking sector and the financial watchdog.

Chinese tech giants reportedly relied on U.S. technology to build advanced chips. Huawei and Semiconductor Manufacturing International Corp. were able to get gear from two U.S. tech companies to manufacture a seven-nanometer chip, according to Bloomberg. The report suggests that Chinese companies are still able to work around Washington’s ban on high-tech exports to Beijing. Meanwhile, China is reportedly building a $27 billion chip fund.

A House bill that would force TikTok to do more to cut ties with China is moving inexorably toward a vote despite a campaign by the social media giant to galvanize users to fight back.

That sets up a fight that could have ripple effects on U.S.-China relations, the presidential election and the American investment firms with big stakes in TikTok’s parent company, ByteDance.

A bipartisan group of lawmakers approved the legislation, 50-0. The influential House Energy and Commerce Committee on Thursday passed the bill that calls for TikTok to be banned from American app stores unless ByteDance divests from it. Representative Steve Scalise of Louisiana, the majority leader, said the bill would be submitted for a full House vote next week.

The fight between Washington and TikTok may be reaching its climax. U.S. officials have warned for years that TikTok was a national security threat, and the vote followed a classified briefing on the risks the app poses to Americans. Even the White House appeared to support the effort, allowing National Security Council officials to help draft the measure and President Biden recently joined TikTok to reach younger voters.

TikTok isn’t giving up. The company urged users to contact their representatives in Washington to stop the bill ahead of Thursday’s vote, and congressional offices were inundated with calls. TikTok argues it has become economically important, creating jobs and wealth for Americans. The company has also deployed American users to spread that message, and spent millions on lobbyists, although some analysts say those lobbyists seem to have been blindsided by this week’s events.

The company is at pains to show it’s separate from ByteDance. TikTok is based in Singapore and is not available in China. It has also proposed building a data server for American users in Texas in a partnership with Oracle.

The moves may worry some U.S. investors. ByteDance’s biggest backers include Carlyle, General Atlantic, Susquehanna Investment Group and Coatue Management. Some top executives, including General Atlantic’s Bill Ford, Susquehanna’s Arthur Dantchik and Coatue’s Philippe Lafont, are on ByteDance’s board.

TikTok says that’s proof that ByteDance isn’t really Chinese. But few U.S. lawmakers are convinced.

Add Ray Dalio to the list of Taylor Swift fans who’ve described her Eras Tour as revelatory: The billionaire founder of Bridgewater Associates, who usually uses social media to share thoughts from his books rather than selfies, posted a picture of himself on X Thursday after seeing the singer perform in Singapore. His post said “she can bring together Americans and people in most countries much better than either of the candidates” running for the White House. “@taylorswift13 for President!”

A week after Elon Musk filed a bombshell lawsuit against OpenAI, more details are emerging about the machinations behind the attempted coup against C.E.O. Sam Altman that roiled the start-up three months ago. A pivotal player has emerged in the Shakespearean drama: Mira Murati, OpenAI’s C.T.O., who briefly replaced Altman at the helm of the company, write The Times’s Mike Isaac, Tripp Mickle and Cade Metz.

Altman’s leadership style worried Murati. She raised concerns in a private memo to Altman and approached some members of the board with her worries in October. That informed the decision to dismiss him, according to people with knowledge of the board’s discussions.

Altman was portrayed as manipulative and unhappy about being challenged. Murati said Altman’s playbook was to charm people to gain their support only to turn on them if they disagreed. (In a message to OpenAI staff after publication of the Times article, she said she and Altman “have a strong and productive partnership and I have not been shy about sharing feedback with him directly.”)

The OpenAI co-founder and chief scientist Ilya Sutskever raised similar issues. Around the same time as the Murati memo, Sutskever expressed his concerns to the board, according to the people. He joined other board members on a video call in November to tell Altman that he was out. Unknown to Altman, Sutskever and some board members had been discussing Altman’s behavior for months.

Murati and Sutskever are crucial to OpenAI. Murati is effectively the head of operations, joining after a stint at Tesla. Sutskever is one of the world’s top A.I. researchers (he’s a protégé of Geoff Hinton, an A.I. pioneer who quit Google last year to warn about the tech’s dangers). Musk, who co-founded OpenAI, helped recruit Sutskever.

Altman’s control of OpenAI’s venture fund was another red flag. The OpenAI Startup Fund was owned by Altman rather than it having a more typical setup as a legal extension of the company. Some board members worried that he was using the fund to avoid scrutiny from OpenAI’s nonprofit governance structure at a time when the start-up was seeking billions to advance its commercial ambitions.

OpenAI downplayed the rifts. Hannah Wong, a company spokesperson, told the Times in a statement that Murati and the senior leadership team unanimously asked Altman to return as C.E.O. Murati and Sutskever declined to comment but have publicly supported his reinstatement.

What next? OpenAI hired the law firm WilmerHale to review the incident; its report is expected in the coming days.

​​ (The New York Times sued OpenAI and Microsoft in December for copyright infringement of news content related to A.I. systems.)

Deals

Policy

Best of the rest

We’d like your feedback! Please email thoughts and suggestions to dealbook@nytimes.com.

Leave a Comment