Barack Obama picked Delaware Senator Joe Biden as his running mate in a 3 a.m. pick Saturday that gave a new meaning to the 'Friday night news dump.'
Biden's foreign-policy experience made him Obama's choice, according to the news reports. But what are Biden's views on the economy, taxes, deal making and Wall Street? Deal Journal took a look.
- Not a fan of hedge funds: In a Democratic primary debate on This Week last year, Biden blamed hedge funds and private-equity funds for the credit crunch: 'We need more transparency, particularly with regard to hedge funds and private equity funds. They are the ones that are causing this thing to go under. And there's no transparency, no accountability. We don't know how deep this problem is.'
- A stable capital-gains tax: Biden voted no to cutting the capital-gains tax rate in 2005 and 2006. Obama favors imposing an income-tax regime on investment profits from private-equity firms and hedge funds that are currently taxed as capital gains. In 2003, the capital-gains tax rate was cut to 15%. Biden believes raising taxes on dividends will raise $195 billion a year.
- Caution, but not rejection, of sovereign-wealth funds: Biden led Senate hearings in June on sovereign-wealth funds and urged caution when accepting investments from the investment arms of foreign countries, particularly very large funds such as Saudi Arabia's planned $900 billion fund and the $200 billion China Investment Corp. Still, he credited SWFs with helping several U.S. banks, including Citigroup, which received a $7.6 billion investment from the Abu Dhabi investment authority: 'From the financial perspective, however, these funds could be an important source of capital in our global economy. Wealth Funds can bring benefits to our economy. They've helped keep our banks afloat in the midst of the subprime mortgage crisis and ensuing credit crunch. They could offer a fresh infusion of capital, fuel employment and stimulate the U.S. industry.' Biden said greater transparency wouldn't make sovereign-wealth funds appear less-threatening to U.S. national security interests, but that 'punitive defensive regulation could be self-defeating, depriving us of potential benefits out of the fear of potential harm.'
- No tax breaks for anyone earning more than $1 million: Sorry, Wall Street. Those deal makers who are still employed will surely pay higher taxes in an Obama-Biden administration. Biden has said he supports the elimination of tax cuts for anyone earning more than $1 million a year; he expects that to raise $85 billion a year for the government.
- Toeing Obama's line on Nafta: In a debate broadcast on National Public Radio in December, Biden said, 'the thing I'm most unsure about, is how you rationalize competition and trade policy. I think that's the single most difficult challenge that I will have as president.' More recently, Biden has supported Obama's view that the North American Free Trade Agreement-which governs $810 billion in trade-should be renegotiated along more favorable lines for the U.S.
- He was saw early on that the credit crunch would get ugly: In that same Democratic primary debate in August 2007, Biden said the then-nascent credit crunch was 'almost as deep in terms of dollars, not liability, as the savings-and-loan crisis.'
Heidi N. Moore |
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