Harris is caught between billionaire donors, economic progressives, and the question of Lina Khan

• Harris is facing opposing pressures from Dems about whether to replace the FTC chair, Lina Khan.
• The VP hasn't given much away about her views on Khan in an apparent attempt to balance both sides.
• Harris has room to loosen the FTC's regulatory agenda, but risks upsetting progressives.

At a moment when the Democratic Party is trying to project unity, disagreements about corporate power and regulation are threatening to expose cracks in the solid exterior. Vice President Kamala Harris faces opposing pressures from opposite wings of her party about whether to replace Lina Khan, the chair of the Federal Trade Commission, putting the presidential candidate in a delicate and awkward spot.

"There are a number of factors that would shape the Vice President's thinking," said William Kovacic, former FTC chair and current law professor at George Washington University. "One is, in isolation, what kind of policy do I want?"

As of right now, it doesn't seem that anybody is quite sure of the answer.

Since President Joe Biden appointed Khan as chair in June of 2021, she has taken on an ambitious antitrust agenda, relying on seemingly forgotten federal laws to reign in monopoly power and corporate mergers. Her actions have drawn the ire of some big names in Silicon Valley, namely billionaire and Democratic mega-donor Reid Hoffman . At the same time, economic progressives like Elizabeth Warren have praised Khan's stances. Harris finds herself stuck between the two camps, struggling to determine how to be at once a pro-business and sufficiently progressive candidate.

Hoffman turned heads when he went on CNN at the end of July and said Khan is "waging war on American business " and that he would prefer that Harris replace her. Barry Diller, a media mogul, called Khan "a dope" and said he would advocate for her removal should Harris win in November.

Khan's term as chair ends in September, though FTC rules stipulate that she will remain in her position until the president appoints and the Senate confirms someone else. The confirmation process is involved and lengthy, according to Kovacic, who experienced it firsthand. Though Biden will be in office when her term is up, Kovacic anticipates that he will take Harris' wishes into consideration when deciding whether to replace Khan. Presidents are not obligated to appoint a new chair within a certain time period.

"My intuition would be that, just as a general protocol, the President in this circumstance would respect the prerogatives of the Vice President," Kovacic told Business Insider. "Another approach the President could take would be to say, 'I'm not going to fill the spot. I'm not going to act on this, because the chair of the FTC will remain the chair until her successor is qualified, so I'm not going to act. And Kamala, it's all yours after you're sworn in."

As with much of her specific policy positions, Harris has remained relatively tight-lipped about her plans for Khan and has thus far avoided ruffling too many feathers. Kovacic anticipates that she might try to move further into the center when it comes to mergers , but stay away from tempering the administration's stance on monopolization.

When asked to comment on this article, the Harris campaign told Business Insider that Harris plans to propose a federal ban on corporate price-gouging and give the FTC investigative authority into corporations that violate the rules in a speech on Friday. They did not comment on whether she would replace Khan as chair of the FTC.

"Typically, by this point, the nominee would have made more specific policy proposals, because they would have had to in order to secure the support of various factions within their party's coalition," said Sanford Gordon, the chair of the politics department at New York University. "Harris really hasn't had to do that."

Her vagueness likely stems from the awkwardness of her positioning — she is close to Silicon Valley while also trying to appeal to progressives. Harris is raking in money from venture capitalists, has appointed her brother-in-law and Uber executive as a campaign advisor, and is a Bay Area native .

As some on Wall Street grumble about Khan , members of the business and tech community hope Harris will be open to restoring a more relaxed relationship between the FTC and big corporations. Yet that same belief is a source of concern for economic progressives , whom Kovacic referred to as the "Warren faction," referencing the Massachusetts senator.

Compared to Biden, Harris has more freedom to loosen the FTC's regulatory posture, Kovacic said. In 2020, the president promised Warren significant say over economic regulatory agency appointments, and he has stayed true to his word.

"That was Biden's promise. That's not Harris' promise," Kovacic said, noting that Harris must assess her relationship to the Warren wing of the party. "How much loyalty does she feel to them? How much does she believe she has to cater to their tastes in order to maintain a harmonious political relationship?"

A coalition of progressive and consumer advocacy groups sent a letter to the Harris campaign in response to Hoffman and Diller's comments and urged her to keep Khan.

Hoffman and Diller have since tempered their stances, but Harris still seems stuck between the risk of alienating donors and inflaming economic progressives in her party.

In a lengthy post on X , Hoffman said that he has never talked to Harris about Khan and will support her campaign regardless of her FTC appointments. Diller qualified his comments to Bloomberg , saying, "I said, 'she's a dope.' She isn't. She's smart, but I believe overreaches in disrupting sensible business combinations."

Harris will likely continue trying to find a faint, almost invisible middle ground between the two wings of her party by deflecting specific questions, Gordon said.

"I don't think [Hoffman] is going to get her on the record, in public, making any kind of commitment whatsoever," Gordon said. "I think that would be politically extremely in-astute of her."

Despite Hoffman's public comments, it also remains unclear what Silicon Valley thinks overall. The world of venture capitalists and tech billionaires has suffered partisan divides this election cycle , and it seems that there may be varying opinions among Democrats in the area as well. Kovacic said that some tech companies likely approve of Khan precisely because she targets their nemeses.

"We know Reid Hoffman has grabbed the headlines, but we also know, from our own work, that there's a diversity of opinion in Silicon Valley and among VCs and entrepreneurs who want to encourage innovation and fairness in the sector," said Taylor Jo Isenberg, the executive director at the Economic Security Project, a progressive non-profit focused on economic issues and anti-monopoly actions.

"It's tempting to s ay there's this sort of progressive wing of the Democratic coalition and then there's the donors, and the donors are coming from the sort of people like venture capitalists connected to Silicon Valley," Gordon said. "However, as with many regulatory issues and particularly antitrust, it's not especially clear to me that there wouldn't be divisions within business and within venture capital."

To make matters more complicated for Harris, the issue is one of the few areas of bipartisan murkiness. Sen. JD Vance, the Republican vice presidential nominee with his own links to Silicon Valley, has praised Khan, who was approved with bipartisan support in a 69-28 vote.

As Harris works to define herself as a candidate and be sufficiently specific in her policy proposals, the Khan question is emerging as a particularly delicate one, and it remains unclear how she'll discuss the thorny issue on the campaign trail.

"There's an opportunity to pay attention to the diversity of voices that are out there talking about this," Isenberg said. "But campaigns are a hard time for nuance."