By Trevor Hunnicutt
NEW YORK (Reuters) - Some Wall Street investors and Democratic donors sharply criticized progressive firebrand Elizabeth Warren's policies on issues from taxation to affordable healthcare because they are impractical.
Speaking at the Reuters Global Investment Outlook 2020 Summit, several investors said, however, they were not too worried by a potential Warren presidency because many of her plans would struggle to pass what is likely to be a divided Congress.
"Her policies scare the heck out of every wealthy guy I know," said Mike Novogratz, CEO of Galaxy Digital, which invests in cryptocurrency and blockchain. But he added: "They don't scare me as much because I don't think they're practical." Novogratz has donated to Warren's rivals, including South Bend, Indiana Mayor Pete Buttigieg.
While cool on the U.S. senator from Massachusetts specific policy proposals, several donors and investors credited her political savvy, financial knowledge, and agreed that policymakers needed to confront rising income inequality or face long-term adverse social and economic repercussions.
But many questioned whether Warren's proposals would successfully address these issues, saying they feared her plan to fund trillions of dollars in social projects through a range of taxes could have unintended adverse consequences, such as reducing economic growth or dampening the stock market.
"Senator Warren is saying things that are difficult to enact, and I don't know how you end up paying for them," said Marc Lasry, chairman at Avenue Capital Group, who has donated to several of Warren's opponents for the Democratic nomination.
Wall Street's antipathy for Warren will help more moderate and conservative alternatives, including former New York City Mayor Michael Bloomberg, who is expected to file for the Alabama Democratic presidential primary to keep his options open for a possible presidential run, a source familiar with the matter told Reuters on Thursday.
The Warren campaign did not respond to a request to comment.
Warren, who is seeking the Democratic nomination to face Republican President Donald Trump in the November 2020 election, has long made it clear she has little regard for Wall Street and many wealthy investors have much to lose if she is successful. Buoyed by grassroots funding, she has been able to snub the corporate coffers that have backed many presidential campaigns and propose policies that would squeeze the wealthy.
She has outlined a new tax of at least 2% on households whose net worth tops $50 million as well as a charge of 0.1% to sell stocks or bonds. She also wants to break up big banks, big tech and increase regulation on private-equity companies.