Business leaders around the country are uniting to urge Congress to certify a win by President-elect Joe Biden without delay, arguing that any attempt to “thwart” the process would “run counter to the essential tenets of our democracy.”
On Monday afternoon nearly 200 leaders signed the short, open letter asking legislators to certify Biden’s presidency on Jan. 6. “Our duly elected leaders deserve the respect and bipartisan support of all Americans at a moment when we are dealing with the worst health and economic crises in modern history,” they wrote.
The letter presents the largest united push by the business community to stop President Donald Trump and a group of 12 senators from various attempts to claim the election, which Biden won by 74 electoral votes and 4.5 points.
In November, top CEOs met privately to discuss possible collective action against the President if he refused to leave office. They decided, said Yale management professor Jeffrey Sonnenfeld, who led the meeting, to allow the President to challenge the results of the election legally. But if the President’s actions began to hurt the peaceful transition of power, the group said they might take public action collectively and privately put pressure on their Republican congresspeople to speak out.
Trump and his associates have lost about 60 legal battles related to the election in courts around the country, but they still refuse to concede.
“President-elect Joe Biden and Vice President-elect Kamala Harris have won the Electoral College and the courts have rejected challenges to the electoral process,” reads the letter signed by a variety of Fortune 500 leaders including Albert Bourla, Pfizer chairman and CEO; Larry Fink, BlackRock chairman and CEO; Ajay Banga, Mastercard executive chairman; and David Solomon, Goldman Sachs chairman and CEO.
The letter follows news that Texas Senator Ted Cruz plans to lead 11 Senators on Wednesday in an attempt to block Congress from officially certifying the election results unless there is another audit of the numbers.
“We intend to vote on January 6 to reject the electors from disputed states as not ‘regularly given’ and ‘lawfully certified,’” the senators said. “Unless and until that emergency 10-day audit is completed.” In the House, up to 140 Republicans have said they may vote against certifying the Electoral College win.
The issue has caused a rift between Republicans. Senate Majority Leader Mitch McConnell does not support the audit, but has not used his power to stop it. Republican Senator Pat Toomey, who is retiring after this term, said that the efforts directly undermine the American people’s abilities to elect their leadership and that “allegations of fraud by a losing campaign cannot justify overturning an election.”
Ted Cruz is expected to run for president in 2024, as is Missouri Senator Josh Hawley, who has separately said that he will not certify election results on Wednesday.
Senators Marsha Blackburn, Mike Braun, Steve Daines, Ron Johnson, John Kennedy, and James Lankford, along with Senator-elects Bill Hagerty, Cynthia Lummis, Roger Marshall, and Tommy Tuberville, will join Cruz in his demands.
President Donald Trump tweeted his support of the initiative this weekend, and Vice President Mike Pence “welcomes the efforts of members of the House and Senate to use the authority they have under the law to raise objections and bring forward evidence,” said Marc Short, Pence’s chief of staff.
Many of the Senators who oppose the certification of the vote are up for reelection, and may fear that opposing Trump will lead to primary challengers in their home states. The assurance of the business community may, perhaps, ease some fear about tight purse strings in election campaigns for those who do certify the Biden presidency.
More politics coverage from Fortune:
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- Under Biden, expect more scrutiny of Big Tech and mergers
- Why a key Georgia county flipped from red to blue—and what it means for Democrats
- Pfizer, Trump, and Biden: A twisted triangle that’s complicating COVID-19 relief
- Biden’s first 100 days: Student loan debt won’t go anywhere
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In support of political contributions
Most Americans don’t want CEOs involved in politics. A poll conducted last week by Golin and Ipsos found only 41% favored CEOs weighing in on disputed elections, and only 43% wanted them speaking out on impeachment. On the other hand, 74% say CEOs should call for unity and a peaceful transfer of power, and 57% believe it was appropriate for CEOs to speak out after the January 6 insurgency at the Capitol. That pretty well tracks with the way most CEOs and business groups have behaved since election day. They kept their powder dry until all legitimate avenues for disputing the election were exhausted, then came out strongly endorsing the election results and attacking efforts to undermine them. Relatively few have backed impeachment. (You can see the poll results here.)
But how about political contributions? That’s the question raised last week, as a host of companies—Marriott, AT&T, American Express, Best Buy, Cisco, Comcast, Dow and Amazon among them—suspended campaign contributions to members of Congress who challenged the election results. Another large group—Microsoft, Boeing, Blackrock, Coca-Cola, JP Morgan, Ford, GM, UPS, Goldman Sachs and Citigroup—temporarily halted all political contributions to members of both parties. (Quartz has a more comprehensive list of what companies did here.)
Some business leaders are even contemplating permanently shutting their political action committees and exiting the money game altogether. But absent a broader overhaul of campaign finance—which is unlikely anytime soon—I think that’s a mistake. Most big companies remain balanced players in the money game, dividing their dollars roughly equally between members of each party. Walmart, for instance, has kept its contributions at exactly 50-50. Their strategies have less to do with trying to influence outcomes, and more to do with assuring they have access to whoever wins.
The more important question for 2021 is how big business uses that access. There are a host of issues where business has the potential to help broker positive outcomes for the U.S. economy and society: economic stimulus, infrastructure, worker training, climate change. On each of these, business leaders occupy the center, and can help bring the parties together to solve urgent problems.
But on tax and regulatory issues, in particular, corporations will be playing defense. And they’ll be tempted to use what influence they can muster to seek tax breaks and regulatory exemptions that aren’t in the broader public interest. That’s where the commitment to stakeholder capitalism will be tested. The nation desperately needs business involved in government. But business, now more than ever, needs to use its influence to focus on solving long-term challenges.
Why Big Tech regulation is good for private equity, according to one CEO
Increased scrutiny of Big Tech’s power may have some shareholders sweating it. But not so for private investors.
With a new Biden administration and recent threats to crack down on some of the biggest tech behemoths (from Facebook to Amazon), there seems to be support for more regulation. And according to alternative investment manager Hamilton Lane’s CEO, Mario Giannini, that might be good news for the private equity industry.
“Reducing the dominance of large technology companies…is probably not great for some portions of the industry, but good for private equity,” Giannini tells Fortune. In Congress, which now maintains a slim Democratic majority, “I think everyone is interested in saying, ‘Amazon is too powerful, Google [is too powerful],’ pick your name,” he says, arguing there’s bipartisan support for more regulation.
As to what lawmakers do about it, “I’m not sure,” says Giannini, but “to the extent that they do anything to diminish the power of those companies, that’s good for private equity because it creates opportunity for smaller companies.”
To be sure, government scrutiny of large tech companies is a tale as old as time, but lately regulators appear to be turning up the heat on the biggest names: Facebook was recently hit with an antitrust lawsuit alleging it has squashed competition, while players like Amazon and Apple, big winners of the pandemic era, have found themselves the subject of government ire over antitrust concerns. Google, meanwhile, is in hot water once more for its search and search advertising practices. And companies like Facebook and Amazon could be facing their own headwinds in Europe, too.
According to Giannini, whose firm has $73 billion in assets under management and advises on $474 billion in additional assets, the dominance of those FAANG names has been top of mind for private equity firms when scouting for deals.
“Right now, when any private equity [firm] does a deal, …if it’s not their first question, it’s one of their top three questions: ‘Is Amazon going to enter this space, yes or no?’ And that has a huge impact—’Is Google in this space?’” he says.
It isn’t just an issue in tech. Companies like Amazon are moving into health care, for instance, by launching online pharmacies. “If all of the sudden the government [would] say, ‘I’m not going to allow Amazon to encroach in certain areas,’ then I think for private equity, oddly enough, that becomes a net positive because you do then have an opportunity with other companies,” says Giannini.
Though some on the Street argue the threat of sweeping legislative changes to hamper Big Tech’s reach is still minor, the new (albeit slim) Democratic majority in Congress poses “a clear negative for Big Tech as…we would expect much more scrutiny and sharper teeth around FAANG names,” Wedbush analyst Dan Ives wrote in a recent note.
For private investors, says Giannini, that just “creates different opportunity sets.”
More must-read finance coverage from Fortune:
- What job security? Americans are feeling worn down and fearful of layoffs
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- The U.S. now has a debt level that rivals Italy’s
- In corporate America we trust? Despite perennial crisis, business reputations are rising