The forum, sponsored by Goldman’s small-business program, is one of six such events the bank has staged with 2020 Democratic presidential contenders in Iowa and New Hampshire so far this year. Goldman executives say their purpose is to elevate small-business concerns in the contest. Small businesses employ nearly half the private workforce, and Goldman argues they lack a voice in Washington and have received scant attention on the campaign trail — a realization executives say they reached after shepherding more than 9,100 through the entrepreneurship program they launched nearly a decade ago.
But the effort is also a subtle rebranding exercise by a firm at the center of a knockdown political fight between Wall Street and Main Street. For populists such as Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.), the banking giant remains a totem of runaway Wall Street greed that helped precipitate the 2008 financial crisis and continues to reap a windfall under the Trump administration. To Wall Street titans and the uber-rich, liberal Democratic candidates are villainizing their success and threatening it with their economic plans.
Warren’s “wealth tax” — which would impose a 2 percent levy on households with more than $50 million, with a 6 percent surtax on assets over $1 billion — has prompted some of Goldman’s most prominent alums to take their grievances to the CNBC airwaves. Hedge fund manager Leon Cooperman and former Goldman chief executive Lloyd Blankfein have blasted the wealth tax, with Blankfein attacking Warren for using a “kind of demagoguery.” Warren for her part has leaned into the fight, featuring both men in a CNBC ad and selling a mug reading “billionaire tears” in her campaign’s Web store.
The Democratic Party’s fight over making money — and how much of it should be redistributed by the government — is only intensifying with the entrance into the presidential field of multibillionaire Mike Bloomberg. Wall Streeters such as Cooperman seem relieved the ex-mayor of New York is running, while Warren has attacked Bloomberg as trying to buy the race.
Into this mix has stepped Goldman, which wants to convince both Democratic elected officials and ordinary voters that the firm is on their side. Rhode Island Gov. Gina Raimondo (D) recruited the firm to launch its first statewide iteration of its small-business program three years ago, and 250 entrepreneurs have graduated since.
Raimondo, the head of the Democratic Governor’s Association, said that she is “very, very pleased” with the program and that it has already been “highly impactful” as a job creator.
She argued that “capitalism, as it’s playing out in America, is having serious issues that need to be addressed. . . . Elizabeth Warren has a very justified view that the excesses of Wall Street have hurt Americans, and frankly, she’s right.”
Yet the former venture capitalist, who has also praised Bloomberg’s track record, said she thinks Goldman’s effort “comes from a genuine place.”
Democratic voters may be a tougher sell. They believe Wall Street hurts the economy more than it helps it, by a margin of 46 percent to 41 percent, according to a January poll by the Pew Research Center. More than 8 in 10 Democrats think the political system mainly benefits those in power, a Washington Post-ABC News survey in April found. And there is widespread voter concern about the industry’s political influence, with 69 percent saying financial services interests wield too much power in Washington, according to a 2018 Kaiser Family Foundation poll.
Goldman launched the small-business initiative in 2010 with a $200 million commitment and a goal to give 10,000 people with established businesses accelerated training in growth, including coursework, networking and mentorship. What began with a pilot project at LaGuardia Community College in Queens now has operations in 19 locations, including three statewide programs, plus a national cohort.
The idea to sponsor the candidate forums came after Goldman hosted a conference in Washington in January 2018, flying in about 2,000 program graduates to discuss policy challenges facing small businesses.
Goldman Sachs’s executive vice president, John F.W. Rogers, chair of the firm’s foundation, which underwrites both the 10,000 Small Businesses program and the forums, said the events are “about putting this on the agenda of the candidates. I haven’t seen anybody say, ‘Here’s my plan for small business in America. Here’s how I’m going to address the regulations they face, the need for capital.’”
“There seems to be a frustration that nobody thinks about the issues that challenge them,” Rogers said. “I hope some of these businesses will grow one day to become big enterprises and do business with Goldman Sachs,” but the firm has no direct economic stake in the program.
Yet the firm also uses the events as opportunities to strengthen its ties to the candidates, sending lobbyists from its Washington office to greet them. For the Harris event, it was Joyce Brayboy, who was chief of staff to former congressman Mel Watt (D-N.C.), who has spent over a decade pressing the firm’s interests on Capitol Hill.
“We are naturally interested in what the candidates have to say, so we typically send a representative to listen among the hundreds of local citizens and small business owners in attendance,” a Goldman spokesperson said in a statement.
Dennis Kelleher, president of Better Markets, which advocates tougher regulation of the financial services industry, sees a self-serving agenda at play. “This is the tip of the spear of Goldman’s whole strategy to reintroduce itself to America as a retail bank that cares about Main Street, rather than a global bank that was engaged in decades of illegal conduct that had devastating consequences for families across the country,” he said. “This is one of the biggest banks in the world staging candidate forums not just as brand enhancement but also to put on their best face with the next president, who will be picking their regulators.”
Those who have participated in the events hail from the party’s more moderate wing: In addition to Harris, they include former vice president Joe Biden, Sens. Michael F. Bennet (D-Colo.), Cory Booker (D-N.J.), Amy Klobuchar (D-Minn.), and former candidate and congressman Beto O’Rourke (D-Tex.). South Bend, Ind., Mayor Pete Buttigieg, who is drawing more interest from Wall Street donors as a potential moderate alternative to Biden, is still considering whether to participate, a spokesman for his campaign said.
The biggest critics of Wall Street, however — Warren and Sanders — don’t intend to show up, their campaigns confirmed. “This is exactly what Sen. Sanders means when he talks about a corrupt political system,” spokesman Mike Casca wrote in an email.
Rogers said whether candidates participate is up to “the political judgment of the campaigns.”
He added that “certain candidates have views toward financial institutions, and everything from capital requirements to other regulations. I myself am not an alarmist about those things.”
The firm’s political action committee doesn’t contribute to presidential campaigns. But Goldman employees have given them roughly $100,000, according to figures from the Center for Responsive Politics. Topping the list, through the end of October: Klobuchar ($29,500), Biden ($20,166) and Booker ($17,893). Trump has pulled in $3,886. Goldman workers are tilting Democratic with their congressional contributions this cycle, directing 53 percent of their dollars to the party’s candidates.
Financial regulation hasn’t come up at the candidate forums. Yepsen, the moderator, says Goldman has no input into the questions he asks. The hour-long session with Harris didn’t stay focused on the economy: It touched on job creation and the minimum wage but also covered immigration, gun control, criminal justice overhaul and health care.
Yet Goldman’s sponsorship was impossible to miss. The event was introduced by Des Moines Area Community College president Ron Denson, who touted the small-business program’s record helping its graduates expand their operations. Then the crowd heard from Elizabeth Hoppe, a coffee shop owner from Emmetsburg, Iowa, who credited her participation with enabling her to open a second location. She also thanked the bank for its “investment in small business and for providing these opportunities to discuss issues that impact our community.”
On the same stage, in July, Booker name-checked Goldman’s small-business effort as a model that should be expanded. “That shouldn’t be the exception; that should be the rule,” he said, “because we know the majority of our jobs that are being created in America are jobs being created by small businesses.”