When Donald J. Trump first ran for the White House in 2016, his closing campaign advertisement lamented the influence of Wall Street in Washington, flashing ominous images of big banks and the billionaire liberal philanthropist George Soros.
Now, as president-elect, Mr. Trump has tapped two denizens of Wall Street to run his economic agenda. Scott Bessent, who invested money for Mr. Soros for more than a decade, is his pick for Treasury secretary, and Howard Lutnick, the chief executive of Cantor Fitzgerald, will be nominated to lead the Commerce Department. Mr. Trump’s choices to lead his economic team show the prominence of billionaire investors in setting an agenda that is supposed to fuel a “blue-collar boom” but that skeptics think will mostly benefit the rich.
As Mr. Trump prepares to assume the presidency in January, business owners and investors are closely attuned to which of his economic promises he will ultimately follow through on. He has promised to slash tax rates, impose hefty tariffs on China and other countries, and deport millions of immigrants who work in American farms and businesses.
The selections of Mr. Bessent and Mr. Lutnick cement a hold by Wall Street executives over the two most important economic posts in any administration. The picks are drawing blowback from Democrats and left-leaning groups, who assailed Mr. Trump for giving top jobs to rich donors and suggested that they would soon be working to create new tax breaks for the rich, not those who are struggling.
“For all his talk of looking out for working-class Americans, President-elect Trump’s choice of a billionaire hedge fund manager to lead the Treasury Department shows he just wants to keep a rigged system that only works for big corporations and the very wealthy,” said Tony Carrk, the executive director of the government watchdog group Accountable.US.
Yet the decision to tap Mr. Bessent and Mr. Lutnick is raising speculation that Mr. Trump could take a more market-friendly approach to many of his economic policies than some had feared because of his professed love of tariffs, which had the potential for igniting a global trade war.
Mr. Trump’s promises to impose tariffs of 10 percent to 20 percent on goods from around the world, and tariffs of 60 percent or more on products from China, have worried business owners. But many investors still seem to be betting that he will not fully pursue those plans.
Some economists are also more optimistic that the selection of nominees with deep market experience means that Mr. Trump may take a more measured approach to trade negotiations.
“It gives me a little bit of hope that we’re going to avoid the worst of the economic populism,” said Scott Lincicome, a trade expert at the free-market-oriented Cato Institute. “One of the biggest checks on Trump’s populist impulses will be the markets.”
It remains to be seen how much that perspective will end up influencing Mr. Trump, who has a record of vacillating between market-pleasing measures like tax cuts and sweeping tariffs that businesses and investors typically dislike.
Both Mr. Bessent and Mr. Lutnick, who Mr. Trump said would oversee his administration’s trade and tariff policy, have defended Mr. Trump’s plans for imposing tariffs on imports. But other statements have suggested that they prefer more targeted tariff policies and more open trade policies.
That is a sharp contrast to others in Mr. Trump’s circle. Trade advisers like Robert E. Lighthizer and Peter Navarro have argued that higher tariffs in themselves offer benefits for the U.S. economy, by blocking out unfairly made foreign products and offsetting undervalued currencies in other countries.
In an interview with CNBC’s “Squawk Box” in September, Mr. Lutnick promoted Mr. Trump’s tariff plans as a way to help American workers, but he said tariffs should not be placed on “stuff we don’t make.” He also described tariffs as a “bargaining chip” that would ultimately force other countries to lower their own tariffs and lead to freer markets.
“Everybody else is going to negotiate with us,” he said.
As the head of major financial companies, Mr. Lutnick has found his fortunes to some extent dependent on steady business with China, which Mr. Trump has singled out for another round of punishing levies. Like many investment firms, both Cantor Fitzgerald and BGC Group, of which he is also the chief executive, have investments in China.
Mr. Lutnick has said that he would step down from his positions in the companies if confirmed by the Senate for the Commerce role. He would also have to divest millions of dollars in stock under federal law, to avoid holding assets that could be affected by his work at the Commerce Department.
Mr. Bessent also proclaimed his support for tariffs in an opinion piece for Fox News in mid-November. “We should not be afraid to use the power of tariffs to improve the livelihoods of American families and businesses,” he wrote in the article.
In an interview with the journalist Mark Halperin in October, Mr. Bessent gave a much more free-market vision of Mr. Trump’s trade agenda.
“Donald Trump really is a free-trader,” he said, saying that Mr. Trump had offered to drop American tariffs if other countries dropped theirs. “I think a lot of what he’s doing is escalate to de-escalate. And my goal for his administration would be to save international trade, not end up looking like something with turn-of-the-century tariffs.”
Mr. Trump is not breaking the mold by choosing people with Wall Street ties to top posts. Eight years ago, he tapped Steven Mnuchin, a former Goldman Sachs partner, to be his Treasury secretary, and Wilbur Ross, a billionaire private equity executive, to head the Commerce Department. Both men were prominent donors and advisers to Mr. Trump’s first campaign, which won over voters with populist pledges to keep corporate influence out of politics.
One key question is whether Mr. Trump ultimately adds more protectionist-minded officials to his administration, as he did in his first term. The addition of those more hawkish voices, such as Mr. Lighthizer, helped push Mr. Trump to impose tariffs on foreign metals from allied nations, along with more than $300 billion of Chinese goods.
Mr. Lighthizer, who served as Mr. Trump’s U.S. trade representative and a key adviser, has so far not been selected for a position. Mr. Lighthizer’s preference this time around was not to be reappointed to his old post, people familiar with the situation said. Instead, he preferred another post that would have statutory power over tariffs and trade.
That would presumably mean leading the Treasury or Commerce Department. With those jobs already filled, it is unclear whether Mr. Lighthizer will be offered another economic post, or perhaps not take any position in the second administration. It also remains to be seen whether Mr. Navarro, an ardent China hawk, will be offered a key position.
The possibility that Mr. Lighthizer might not be offered a post has prompted concern among his supporters.
“Brash Wall Street/Finance guys are doing the hard sell for themselves,” Michael Stumo, the head of the Coalition for a Prosperous America, a group that supports higher tariffs, wrote in a social media post before Mr. Trump announced his selection of Mr. Bessent for Treasury secretary. “But the obvious choice as a knife fighter for Trump’s correct version American economic rebirth is Lighthizer, who apparently is not selling himself like a Wall Street guy or at all.”
Mr. Stumo added that a “massive battle” would be coming next year with the prospect of including across-the-board tariffs of up to 20 percent as part of the U.S. tax code, and that the Treasury Department would have to take the lead in pushing that through Congress.
Until Mr. Trump’s economic team is fully in place, it remains to be seen whether fault lines will form between those who hail from Wall Street and advisers with a more populist perspective.
But first Mr. Bessent and Mr. Lutnick might have to put any lingering differences aside following their competition to be named Treasury secretary. Although Mr. Bessent ultimately won the job, the battle devolved into an internal “knife fight,” according to one person familiar with the process, with Mr. Lutnick as the primary aggressor.
It is also possible that Mr. Trump’s pro-tariff policies could still win out, even over the objections of his Wall Street advisers. In Mr. Trump’s first term, tariff skeptics like Mr. Mnuchin helped to postpone the imposition of any significant tariffs in his first year.
But in 2018, Mr. Trump’s second year in office, his-pro tariff instincts roared back, enabled by others in the administration who supported them. He ultimately imposed tariffs on hundreds of billions of dollars of imports.
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