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So David, it happened.
It did. At the end of a long weekend and a few long.
Weeks after mounting pressure from members of Joe Biden's own party in Congress, and finally reportedly from his former running mate and former President Barack Obama, Biden released a statement saying he'd drop out of the twenty twenty four US presidential race.
Suddenly, on a Sunday afternoon, the dam broke.
That damn broke via tweet. I called up Gregory Cordy, a White House and Politics reporter, to get his reaction to the news.
The decision isn't a surprise, but the sudden timing of it was.
And Sarah, we got an answer to that big question, would Biden drop out? But that only raised more questions.
In addition to the decision not to run for reelection, there are a lot of decisions baked in that decision. Does he tap an air apparent? Does he endorse Kamala Harris.
Who would donors back to replace him? Where does the Democratic Party go from here?
And not long after his first announcement, Biden tweeted an endorsement of Harris, but that endorsement now kicks off an entirely new phase of the election, which means there are even more unknowns.
The Democratic National Convention is just one month away. Voters will go to the polls in less than four months. Even if Harris clinches the nomination in Chicago in August, is there time for her to fundraise and advertise herself to the American people? How much money does a candidate really need to campaign successfully if they're taking over the ticket so late.
In the year.
Well, my first lots was it's gonna be a long three or four months. Now.
This is the big take from Bloomberg News. I'm David Gura and I'm Sarah Holder.
Today on the show, I dig into these questions with Gregory and with Money and Politics editor Laura Davison. As of Sunday evening, just hours after President Biden's announcement, not much was known about how he made the decision and how he thought about timing its release. I asked Gregory Cordy and Laura Davison about that.
It's hard to say because he kept counsel only with a very small inner circle of aids on this. We're getting reporting that even his own campaign staff was blindsided by this announcement. He may have been waiting until after the Republican Convention for things to settle. He was in seclusion for the past few days recovering from a COVID infection, so he may have been waiting to see if he could ride that out and come back.
It's really important to note that in the past, you know, essentially three weeks since the debate that really sparked all these concerns, Democratic donors have basically said, look, we are freezing contributions to your campaign. There have been a handful of donors who've come out and said I'm still with the president, but most folks said, look, we're not going to throw good money after bad. We want this guy out, and our leverage is donors is money. So you saw,
you know, a bunch of different efforts. You know, some donors start different super PACs that they said, would you know, start collecting money that would go to whoever the eventual new nominee is. And this all came at a very critical moment when Trump had a ton of new donor support. You know, folks like Elon Musk and Timothy Mellon were coming in with really large donations, and they realized that, look, this is not a tenable situation here, this.
Moment feels unprecedented, and people are already reacting all around the world. How do you expect markets to react?
We do know that in the past couple of weeks, as Trump has seemingly grown stronger in his bid, that markets has started to price a Trump win in so that looks like, you know, a potential you know, increase in tariffs, particularly targeted Chinese goods, but all sorts of goods. Markets are also anticipating a pretty large tax cut if it's Trump. Anytime there is a seismic shift in what US leadership looks like, there will be market reactions.
So, as part of his announcement, Biden endorsed Mamala Harris as the Democratic Party nominee. Doesn't mean Biden's campaign is shutting down immediately and Harris's is now jumping into action. What happens next, Gregory?
Presumably, if Biden has his way and Vice President Harris has hers, she will take now the top spot of that ticket and recommend to the delegates at the convention next month who her choice for vice president would be her running mate. She would get to keep that sizeable war chest that Biden has built, but he started to burn through cash in the past month or so and
it's not quite as formidable as they would like. So the first order of business is to rebuild that war chest, get some big donors on board through super packs, and then it will be up to the vice president, if it is her as a nominee, to decide how she wants to structure her campaign. But there's really not a whole lot of time right to completely blow up the campaign. It already has field offices, it's already bought a lot
of ad time. That strategy is going to have to check change very quickly, of course, now that there's a new can at the top of the ticket. So a lot of these things we're going to just have to see in the coming days how that all comes to pass.
Just how much money is currently in the Biden campaign coffers compared to Trump.
So just on the raw dollar total, they're not too far apart.
So the Biden campaign has ninety six million dollars. The Trump campaign has one hundred and twenty eight million dollars.
So Trump is ahead not a massive amount.
The thing that's the real differentiator here is that Biden's fundraising has totally fallen off a cliff. The other thing is just how much they're spending.
In the month of June.
This is even you know, before a lot of the debate stuff started percolating, Democrats spent ninety three percent of the money that they brought in compared to Trump, who was spending less than half.
So just the burn rate, there is a massive difference.
The Trump forces have been spending next to nothing. They have a superpack that's spent money in Pennsylvania, Georgia and now has just gone into Arizona. But they've been marshaling their resources, really sort of hoarding their cash while buy has gotten out early. All that money now, I don't want to say it's wasted money because it helped perhaps the Democratic brand, but it was money that was spent
to promote Biden. And now Democrats have to figure out a new branding, a new message now that the nominee will be somebody else.
And Laura, how is the Trump camp reacting to this news.
There's a couple of different schools of thought within the Trump campaign. Just last night, he had a rally in Michigan where he talked about some of the disarray that was happening with Democrats. Of course, this was before Biden announced that he would be dropping out.
But Trump, at the top of his.
Rally essentially like pulled the crowd and said, you know, basically, who do you want to be? You know, our opponent. Do you want it to be Joe Biden? Do you want it to be Kamala Harris? And so the crowd overwhelmingly, by a show of voices, indicated that they wanted Biden to be the nominee. You know, a clear sign that at least, you know, Trump supporters think that he is
an easier candidate to be. However, we know that the Trump campaign for weeks has been preparing that it may be Kamala or it may be someone else in the race that they're running against.
So they've started working on message.
What are we hearing about how Democratic donors are reacting to Biden's announcement and whether they'll rally behind Kamala Harris versus someone else.
So there's really two camps of donors right now.
One some of the major donors who are coming out and saying, look, we support Harris.
These are folks like George Soros and his.
Son Alexander Soros, saying we're going to support Harris and you know what she needs to run. There's another group of donors. I'll note that these are less major donors. These are people who give maybe up to a million dollars but still have an influential voice within the party and are very vocal, and they're saying, hold on a second, we want to make sure there's some sort of open nominating process. We want to have either a primary or
an open convention. And this is going to be a debate that plays out over the next couple of days and whether those loud, vocal voices saying they want some sort of way to choose the nominee versus have it just going to Harris automatically. If they went out, this could be very messy and you could have a lot of different candidates rise to the foe, you know, each siphoning off a little bit of donor money, but not
having donors unite behind candidate. This is the exact problem that Republicans had on their side of after twenty twenty two. The major party donor said, we don't want to have Trump as our nominee. We should all pick a candidate and give to that candidate, and we could defeat Trump.
That never happened. First looked like it might.
Be DeSantis, then maybe Nikki Haley, but Trump at that point was too powerful and had enough support within the party base. A similar thing could happen with Harris if the donors don't decide and that it is clear that the party leadership and the base of the party is moving with Harris. She could be the nominee and donors are going to have to line behind because they just won't have any options at that point.
After the break, we dig into what an open convention could look like and the financial problems that could face the eventual nominee, including how much money a new candidate would need to launch a successful campaign in under four months. We're back. I've been talking with White House and Politics reporter Gregory Cordy and Money and Politics editor Davison about what we currently know about President Biden's decision to drop out of the twenty twenty four race, but what comes next.
The open convention scenario sounds chaotic, perhaps, but could any of this upheaval actually energized donors. Could donors who have thus far sat on the sidelines, get activated to actually start donating more to the Democratic Party.
That's the argument that some of these donors make and say, look, you know, they're particularly arguing for a more moderate candidate. Have someone who's maybe a little bit more business friendly, Have someone who appeals to some of those people who are never Trumpers on the Republican side. You could bring a lot of money in right now, that's all theoretical. There's no one who's coming forth and saying, look, I'm going to pledge you know, X million dollars if it
is a certain candidate. Everyone is sort of seeing where the political winds are blowing, and just the way that the calendar moves.
These decisions have to be made soon.
This is not something that can play out over a couple weeks or months. You know, it's almost a first mover advantage here.
Of games that modern campaigns play is that they try to raise a lot of money around events to kind
of signal that they have the momentum. So I would expect the Harris campaign, now that there is one, to come out in the next few days and give us a total of exactly how many millions of dollars she's raised in a very short period of time to kind of give the impression that there's a snowball effect, that people are rallying around her campaign, that she does have the ability to raise that small dollar donor, and sometimes
small dollar donors follow small dollar donors. If people see that there is momentum behind a candidate, that might encourage even more people to jump in.
Already, we're seeing that tactic in action. As of nine pm Eastern on Sunday night, the Democratic fundraising platform Act Blue announced it received over forty six million dollars in donations from small dollar donors just since Biden officially endorsed Harris. Laura. Supporters of Harris have been saying that one of her biggest assets is her access to Biden's wartch that ninety six million dollars we were talking about earlier. How does
the process work now? Does the Harris campaign inherit all that money automatically or could it go to another nominee If it.
Is Harris as the nominee, Yes, she would be able to inherit the ninety six million dollars or so that is left in the account. She's able to operate a lot more seamlessly than if it's another candidate, so she is able to keep on staff, people could keep their email addresses. If in fact it is another candidate, they have to start a campaign committee, essentially the thing you file with the FEC to say hey, I'm running for president. They have to start a brand new campaign. That campaign
will have zero dollars in it. The ninety six million that's left in the Biden campaign. They can either donate that to the Democratic National Committee or to a super pac, which presumably would then go to support that new candidate ultimately, but you know, at least in their campaign account, they'll have zero dollars, so they'll immediately have to start fundraising.
There are a bunch of fundraising limitations, so for just an individual donor, the most they could give to that campaign is just a couple thousand dollars, so that you've got to go out and bring in a lot of money. You need to bring in a lot of grassroots money. You would need to have all of the super PACs working with you. Imagine a startup. This is what the campaign would be doing of just you know, getting staff hired, getting office space, doing all of.
These things, and it would take them weeks to just get up on the.
Ground and running you know stuff that the campaign when a normal year would have been doing you know, a year or even two years ago.
How much money will they need to run an effective campaign over the next few months.
So Biden and his team you know and kind of allies we're talking about that they need at least a billion, if not more to run this campaign. Biden and his you know, allies raised about a billion dollars in twenty twenty. So far the Biden campaign you know, to date, and you know, along with the DNC, you know, has spent just.
A little bit over three hundred and fifty million dollars.
But of course the spending really really ramps up, you know, as you head into election day. The Democrats have created a strategy that's pretty expensive.
They have a lot of field offices with a lot of staff.
They are running a lot of advertising, you know, tens of millions of dollars you know, in any given month or week. They're going to need a lot of money if they're going to continue the strategy. And because they're going to be introducing a new candidate and a new vice presidential candidate to the public, they're going to need to continue that money.
Bloomberg has reported that Harris has been having meetings with Wall Street executives recently, and from her days in California politics, she has her own ties to Silicon Valley and the tech industry. How might to leverage those relationships.
Harris is very lucky because she comes from California, which is called a donor state in that you know, it's California really funds democratic runs across the country, So she has close ties to Silicon Valley. She is a known entity there, people know her name. Being vice president. She's also been able to operate a little bit more under the radar than Biden. So she's been taking these meetings with folks on Wall Street to explain some of the Biden policies.
She started to build those relationships.
You know, remember she's only fifty nine years old, so she's always had an eye to what she would do after she was Biden's vice president, knowing that she needs to have Wall Street support, She needs to have some of these ties to the business community.
At least among some of the Wall Street donors. He is an ideological divide here that Harris is perceived as perhaps to the left of Biden when she ran in twenty twenty, there was a concerted effort among some Democratic donors to find a more moderate candidate. Remember, Bernie Sanders was in that race, Elizabeth Warren and Kamala Harris was somewhere on the spectrum between Biden and those more liberal candidates, probably a little bit more towards the progressive side. She
was for Medicare for all, for example. She was for a number of different policies that she's now had to subsume Biden's policies as his vice president. But there might be some concern from some Wall Street donors of what they're going to get in a future Harris administration.
In recent weeks, new packs have popped up that are open about fundraising for a non Biden candidate. Do we know how much money those packs have raised?
At this point, we.
Don't know exactly how much money is in them, because they've just sprung up in the past couple of days or weeks. The the ones Mike Novagrats of Galaxy Digital his pack this is a couple weeks old now at this point, but said it raised about two million dollars in the initial days after forming. In the next twenty
four to forty eight hours. I anticipate we'll see a lot of donors come forward, either with actual money or with commitments to give to whether it's Vice President Harris or another candidate, should someone else throw their hat in the ring, and that will be a key determiner of who really has the juice to mount to run here, as.
We've been talking about, a Harris candidacy is not a foregone conclusion. Despite Biden's announcement that he will endorse her. The Democratic National Convention is in one month. Is there still a chance that Democrats might choose someone besides Harris at the convention?
Gregory, That's absolutely possible under the convention rules, But practically speaking, it seems to me that any other candidate would have to get out there relatively quickly before the institutional Democratic Party really rallies around Harris. We're already seeing endorsements from former President Bill Clinton and Hillary Clinton. We're starting to see the Congressional Black Caucus and other really important stakeholders
rally around Harris. She has important support from important constituencies in the Democratic Party, and so it would take a lot for somebody to dislodge her from that perch, and somebody's going to have to come in with a pretty aggressive campaign and a lot of money pretty soon to signal that this is going to be an open process. Otherwise I would expect Democrats to really circle dragons around Harris.
Assuming Harris gets the nomination, what is the process for Harris to choose her running mate and how much you try to leverage that decision to bring in additional funding.
We saw this on the Republican side just this past week when Donald Trump chose JD Vance as his running mate, and he did so really at almost a last possible moment before the roll call even happened, So there is
time for that to happen. We might expect for Harris to wait until close to the convention when it's cleared that she has the votes, although she could come up with a ticket earlier than that, to kind of try to figure out how to unify the party, maybe pick somebody from a different wing of the party, maybe a governor. Andy Basheer, the governor of Kentucky's name has come up. The governors from Michigan and Maryland and Pennsylvania and California,
all of whom could be potential running mates. One potential path would be dislect as a running mate somebody who is already independently wealthy and can write the campaign a big check. You can self fund your campaign, it's not subject to limits. And one name that could come into
play in that kind of a scenario is JB. Pritzker, the governor of Illinois, who is independently wealthy, is a billionaire, inherited a lot of money from his family's hotel and real estate empire, worked in venture capital, and was very influential in getting the convention to come to Chicago in his home state by helping to support that effort monetary, and could do the same if he were on the ticket.
For more on the political fallout from Biden's decision, the market reaction, and the next steps for the Harris campaign, head to Bloomberg dot com. Thanks for listening to The Big Take podcast from Bloomberg News. I'm Sarah Holder. This episode was produced by Julia Press. It was mixed by Alex Sugiura and fact checked by Adrianna Tapia. Naomi Shaven is a senior producer and edited this episode. Our senior editor is Elizabeth Ponso. Nicole Beemsterbor is our executive producer
and Sage Bauman is Bloomberg's head of podcasts. Please follow and review The Big Take wherever you listen to podcasts.