Joe Biden: Donors are turning away from the US president

Some of the US Democrats’ top donors have made it clear which potential candidates they prefer if incumbent President Joe Biden drops out of the race for the White House: According to insiders, donors are focusing on Michigan Governor Gretchen Whitmer and California Governor Gavin Newsom.

Frustration over the difficult situation and concerns about Biden’s prospects are widespread among Democratic officials and supporters. Biden’s condition is being discussed more and more frequently, especially as his poll numbers have plummeted since the disastrous debate with Trump. Many believe that Biden’s insistence on his candidacy is only delaying the inevitable dispute over the succession four months before the presidential election in November.

“Doomed”

“Biden’s candidacy is doomed,” says one donor close to the president who also acts as a so-called “bundler,” whose job it is to collect money from other supporters. “I’m Joe’s biggest fan, he’s an admirable servant of the people, but he’s doomed,” he says. “We need to start focusing on what’s next.”

Vice President Kamala Harris is also among the candidates donors believe could replace Biden, said several donors and fundraisers who are in contact with each other. Preparations are underway to raise hundreds of millions of dollars to fund a new candidate.

Party bigwigs such as Chuck Schumer, the Democratic majority leader in the Senate, and former House Speaker Nancy Pelosi are apparently also involved in the crisis talks, with donors saying the aim is to gauge their mood after the debate.

Conversations behind closed doors

“The pressure is building to turn the tide and focus on finding the right candidate who can win against Trump,” says a New York fundraiser. “Everyone is talking to their contacts to make sure we are ready to support the right candidate once Biden steps down.”

Both Whitmer and Newsom were among the governors who met with Biden for an emergency meeting at the White House in early July. The meeting was scheduled less than a week after the president stumbled in the TV debate, which led to calls from many quarters for Biden’s resignation.

Both governors subsequently reiterated their continued support for the president’s re-election campaign, but donors are working behind closed doors to support the pair should they enter the race for the White House, according to people familiar with the matter.

Shadow campaigns

Whitmer expressed her support for the president on social media. She is also co-chair of Biden’s re-election campaign. However, on Network X she published a link through which donations can be directed to her own political action committee and not to Biden’s campaign team. The governor of Michigan also plans to attend the annual gathering of technology and media entrepreneurs in the state of Idaho in mid-July – a possible platform to meet with major Democratic sponsors.

Newsom has been one of Biden’s prominent public advocates for months. After the debate in Atlanta, he defended the president’s performance in the media’s “spin room.” At the beginning of July, Newsom gave a speech in the contested state of Michigan in which he explicitly praised Biden. However, some observers had previously accused Newsom of running a shadow campaign. In 2023, for example, he took part in a televised debate with Florida Governor Ron DeSantis and traveled to several primaries and election-deciding states.

Whitmer is ahead

Whitmer appears to have the edge among major donors. The main reason is that she is more likely to win in important states such as Michigan. Whitmer won the race for governor in the state in 2022 by more than ten percentage points. Current opinion polls put Trump several points ahead of Biden in Michigan.

“Michigan is a much more important state than California when it comes to elections,” said one major donor. “If you look at the betting odds, Newsom is ahead, but if you consider which states the Democratic Party needs to win, Michigan is crucial and California is not.” Many voters also see California as a “progressive, anti-business, far-left state,” which is why a candidate from the state could harm the party.

A spokeswoman for Newsom declined to comment. A spokesman for Whitmer did not respond to a request for comment.

Disney heiress withholds money

While donors are looking for alternatives, voices are growing among Democratic lawmakers calling for Biden to withdraw from the race. Polls published in early July show that approval of the president has fallen sharply again since the debate.

Abigail Disney, the media giant’s heiress, said she would stop donating to the Democratic Party until Biden resigns. Billionaire crypto investor Mike Novogratz launched a fund called Next Generation PAC to raise around $100 million to support whoever takes over the candidacy. Netflix co-founder Reed Hastings, one of the party’s biggest donors, told the Financial Times that the president must “step aside so a strong Democratic leader can beat Trump.”

The money is supposed to pave the way. At a conference in Colorado, Ari Emanuel, one of Hollywood’s most powerful players and a major donor to the Democrats, said the only way to speed up the president’s resignation is to cut funding. “The lifeblood of a campaign is money,” said Emanuel, whose brother Rahm is Biden’s ambassador to Japan and former chief of staff to President Barack Obama. “And maybe the way will only be clear when the money dries up.” Emanuel said we will see where the money goes in the coming weeks. Many major donors are currently planning to put their funds into election campaigns for the Senate and the House of Representatives.

Warnings of “civil war”

However, there are also warning voices among donors. Some fear that any move to replace Biden with one of the governors could trigger a “civil war” among the Democrats. In these circles, Vice President Harris is seen as a less controversial choice.

Charles Myers, chairman of Signum Global Advisors and a major donor, warned of “deep divisions” among Democrats if a new race were called. An open Democratic convention in Chicago in August — where a candidate is chosen by a floor vote — could also be infiltrated by left-wing Democrats like Alexandria Ocasio-Cortez of New York, some wealthy donors warned.

Copyright The Financial Times Limited 2024