The line between business and politics has vanished
"Stop writing about politics. I signed up for a business newsletter." I get that message, sometimes a lot of them, when this space's eyes wander toward Washington, D.C.
Why it matters: Years ago, it might have been a valid critique. Today, though, the line between business and politics has all but vanished.
First and foremost: The reconciliation debate is really about restructuring the entire American economy, and about funding those changes. It could be a massive externality for how investments perform, what investments are available and how investors get paid.
- Within this, the status quo on carried interest taxation is facing its most serious challenge in over a decade.
Antitrust: The Biden administration is painting with a very wide brush, arguing that corporate consolidation drives up consumer prices and drives down wages.
- Within Big Tech, which has received the bulk of media attention on antitrust, the FTC is now taking a harder look at small acquisitions; a development that could create sell-side headaches.
- And none of this touches on trade policy with countries like China, which can bleed over into antitrust issues for U.S. companies seeking to do cross-border M&A.
F Street: New SEC commissioner Gary Gensler wants to tighten oversight of everything from crypto to SPACs to private investment funds.
- If you don't think this really matters, take a look at crypto investor meltdowns on Twitter during Gensler's congressional testimony earlier this week.
Surface scratching: Add in everything from pandemic rules to labor availability (including immigration). And that's just at the federal level.
The bottom line: This isn't about supporting or opposing particular policies or politicians. It's just about paying close attention, because the alternative is to skirt due diligence.