Billionaire donors need Kamala Harris to eliminate regulators

On calls with her staff and at fundraisers, deep-pocketed donors have repeatedly named Khan, chair of the Federal Trade Commission, as impeding the technology sector and other lucrative parts of the economy, according to people familiar with the matter. The private conversations about having her replaced have intensified since public calls for her ouster in July from Barry Diller, chairman of IAC Inc., and LinkedIn Corp. co-founder Reid Hoffman, who said Khan was “waging war on American business.”

Khan, 35, was appointed by President Biden in 2021 and is a favorite of progressive Democrats like Elizabeth Warren, who called her appointment “tremendous news.” Her time at the FTC has frustrated dealmakers from San Francisco to New York, who have experienced a relative drought of activity in recent years.

Democratic donors on Wall Street will likely keep lobbying in private for Khan to be replaced, some of the people said. However, it’s unlikely any of them are withholding contributions based on her fate at the FTC, and no clear communication has been given to donors about Harris’ position on Khan, they stressed.

Meanwhile, Gensler, whose term as head of the Securities and Exchange Commission is up in 2026, is disliked privately by both Democratic and Republican donors, some of the people said. Gensler has pushed for tougher regulations, but donors have particularly bristled at what they perceive as him talking down to Wall Street, the people said.

Billionaire Mark Cuban, a supporter of Harris, told CNBC this week that the SEC “needs to change” and that he’s asked the vice president’s team to “put my name in for the SEC.” Donald Trump pledged at a crypto conference that if elected he would fire Gensler.

The Harris campaign didn’t provide a comment for this story. 

Douglas Farrar, an FTC spokesman, declined to comment. A spokesperson for Gensler said in an emailed statement that the SEC’s projects “are making our capital markets more efficient, transparent and resilient.”

Tricky Position

For Harris, who’s trying to walk a fine line between attracting donors and appealing to the party’s progressive wing, the pressure to remove Khan and Gensler puts her in a tricky position. While she’s long represented Silicon Valley as senator for California and is well-versed in antitrust debates, Harris has also sought to appeal to Americans irritated by price-gouging, big corporations and Wall Street.

Antitrust lawsuits filed by the FTC under Khan’s leadership have sought to block Microsoft Corp. from buying video-game publisher Activision Blizzard Inc. and aimed to halt the $25 billion grocery-store merger of Kroger Co. and Albertsons Cos. So far, the FTC has a mixed record in stopping deals, having lost two early cases, but has had more success in recent lawsuits.

Two donors close to Harris’ campaign said the argument being presented against Khan is that the FTC’s efforts to hold up mergers are hurting the economy. The idea is that if Harris wants to project herself as pro-growth and pro-business — as she and surrogates have sought to do — Khan will need to be replaced, the people said.

Members of the FTC can only be fired in cases of “inefficiency, neglect of duty, or malfeasance in office,” according to federal law, though the president can designate another commissioner as chair. While Khan’s term expires in September, she can remain in office until the Senate confirms a replacement. That would allow Harris to select a new FTC chair if she wins, though it can take a year or more for a nominee to make it through the confirmation process.

As for Gensler, much of the frustration on both sides of the aisle stems from the SEC’s efforts to crack down on the digital asset industry, which Gensler has described as flagrantly violating securities laws.

No Compromise

Both regulators came into their positions with “a fairly aggressive regulatory agenda and have taken some big steps to try to carry that out,” said Jill Fisch, a professor at the University of Pennsylvania Law School. “They weren’t looking to play it safe. They weren’t looking to compromise.”

It’s a challenge to deal with differing views on regulation running through the Democratic party, Fisch said. Historically, the FTC and SEC were close to the industries they oversaw and were intended to be walled off from their policy being overly driven by politics, she said.

“Right now it’s no longer what’s most sensible to do from a market and industry perspective, but what’s politically salient, and what’s going to please political leaders—and that’s a very tough path to navigate,” Fisch said.

Hoffman, who has donated $10 million to the Harris campaign, appeared to walk back his remarks about Khan in a follow-up interview, saying he hasn’t spoken to the vice president about his concerns and seeking to distinguish between his role as a donor and an expert on the tech industry.

Diller also said in a July CNBC interview that he would urge Harris to drop Khan, before also reining in his comment. 

Hoffman and Diller are worth $5.1 billion and $5.4 billion, respectively, according to the Bloomberg Billionaires Index. Both are also affiliated with companies facing FTC scrutiny.

Hoffman declined to comment for this story. An IAC representative didn’t reply to an emailed request for comment.

Many donors have privately expressed frustration at the duo’s public remarks against Khan, calling them counterproductive and making it more challenging for a potential Harris administration to make changes at the FTC without seeming beholden to billionaires’ money, according to some of the people.

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