Following the turmoil of the January 6, 2021 attack on the U.S. Capitol, many of the nation’s wealthiest individuals vowed to distance themselves from former President Trump. Now, however, they appear to be reversing their stance.
The reason? The prospect of facing millions of dollars in increased taxes should President Biden secure re-election and manage to implement key elements of his second-term agenda.
With Trump’s legal battles and discussions surrounding Biden’s age dominating headlines, it might seem like the 2024 election is solely about personalities. However, for Trump’s affluent acquaintances, the stakes are higher.
Take Nelson Peltz, the billionaire investor who recently faced a setback in his dispute over the direction of Walt Disney Co. After January 6, he publicly expressed regret for his prior support of Trump. Yet now, he appears poised to endorse him again, according to reports.
Ex-President Donald Trump (Credits: The Independent)
Peltz recently hosted a gathering at his Palm Beach mansion for Trump and several fellow billionaires, including Steve Wynn, Elon Musk, and Isaac Perlmutter, the former chairman of Marvel.
In California, wealthy individuals who may disagree with Trump on policy matters still find themselves drawn to him due to concerns about potential tax hikes. Despite his positions on abortion and immigration being unpopular in Silicon Valley, many tech executives prioritize their worry over high taxes above all else.
Oracle’s Larry Ellison initially supported former South Carolina Governor Nikki Haley in the Republican primaries but is reportedly shifting his support back to Trump.
Similarly, Richard and Elizabeth Uihlein, heirs to the Schlitz beer fortune, initially backed Florida Governor Ron DeSantis in the primaries but have now realigned with Trump.
This resurgence of support for Trump comes at a crucial moment for his campaign: his financial resources lag behind Biden’s. Even if Trump were willing to dip into his personal funds, which he refrained from doing in 2020, his finances would face pressure from legal battles and court judgments.
Taxes Emerge as a Central Concern Prompting Affluent Individuals to Realign with Trump
One key issue driving these affluent individuals back to Trump is taxes. The expiration of various tax breaks from the 2017 tax bill by the end of 2025 could result in what many perceive as a substantial tax increase for American households. This prospect has prompted concerns among the ultra-wealthy, leading them to reevaluate their political alliances.
Ex-President Donald Trump (Credits: Business Insider)
Congress will face a tough decision: allow popular tax breaks to expire, extend them, and risk ballooning the federal deficit, or find ways to offset the costs while preserving tax breaks for average Americans. The latter option, which appears to be causing anxiety among the wealthy, could potentially target high-income individuals.
Democrats, in particular, have favored tax increases on the wealthy as a means to address budget deficits. Biden’s proposed 2024 budget includes tax hikes amounting to $4.3 trillion over the next decade, with implications for those earning over $400,000 annually and owners of private equity firms and hedge funds.
While Biden has framed this as an issue of fairness—declaring that no billionaire should pay a lower tax rate than a teacher, sanitation worker, or nurse—Trump has been silent on the topic. However, raising taxes on the wealthy polls well across party lines, with many Americans feeling that the rich aren’t paying their fair share.
Traditionally, wealthy Americans have relied on their connections in Congress to thwart upper-income tax hikes. Yet, as both parties adopt more populist positions, this strategy has become less reliable. Instead, many affluent individuals appear to be hedging their bets by supporting a fellow billionaire for the White House.
