The Political Triumph of Tech

Some 40 years ago, when I was commuting up the West Loop of I-610 for the Houston Business Journal, oil seemed to be in big political trouble.

We know how that turned out.

Today, in 2019, it seems that “Big Tech” is as friendless as “Big Oil” was then. But history sort of rhymes. These only seem to be different days, and you don’t have to be able to rhyme benzodiazepine to figure it out.

Reporters without brains call the reaction against tech their big story. But it’s the reaction to the reaction we need to be looking at.

Google, which once called “don’t be evil” its corporate mantra, is now seen as the epitome of evil, thanks in part to YouTube  and in part to its ad-based business model. Facebook faces many of the same problems, for the same reason. Elizabeth Warren wants to break up Amazon., apparently because their house brands force other companies to lower prices.  Apple, meanwhile, is ducking and dodging while Microsoft, the most valuable one of them all, is skating by. For now.

Only in the last month has the political pushback started to cost tech money. Since May 10, only Microsoft is beating the S&P 500. The stocks of the Cloud Czars are becoming bargains. Recently you could get Amazon.Com for less than 24 times last year’s earnings, and Apple for under 12.

Republicans are right to be fearful. The five Cloud Czars represent over $4 trillion in market cap, and this is who leads them. Satya Nadella and Sunder Pichai, both Indian immigrants. Tim Cook, gay. Mark Zuckerberg, a millennial, under 40. Jeff Bezos, owner of The Washington Post. It should also be noted that Mark Benioff of Salesforce.Com now owns Time, and Steve Jobs’ widow owns The Atlantic.

The Cloud Czars’ takeover of media has just begun, using personal seat-cushion money.

It’s necessary for tech to continue to prosper. When you fail to control the medium you created, someone else will, and they won’t have your interests at heart.

The Internet is the first medium to rise alongside the industry that owns it, yet mainly out of fear of telephone-like common carrier regulation the owners of that medium have mainly left it alone.

That is starting to end.

Facebook is now monitoring political speech on its network, and so is Google, but it’s not easy. The platforms (as they’re now called) simply haven’t put much money into it. 

That will change.

Technology advocates have always assumed that truth would always beat lies. But lies can get halfway around the world before truth puts its pants on and tech is still reaching for its underwear.

That’s mainly because the platforms wanted to make truth a profit center, first, before investing in it. The telephone giants refused to invest in technology without a guaranteed profit, and the technologists refuse to invest in content with the same excuse.

Apple News is fine, but most consumers don’t pay for content, especially in the developing world. Google News is useful, but more-and-more of the content it links to is behind paywalls, and content providers even want money for the links (while offering nothing in exchange). The Washington Post is paywalled, and Microsoft got out of the news business decades ago. Facebook is still 20% off its 2018 high because its news feed is seen as corrupt.

But as the rise of Trump and other dictators makes clear, tech has no choice but to get into the media game. When fake sellers rose up on Amazon’s marketplace, Amazon invested in fighting them. They must do the same with content.

Beyond control over the discussion, what does tech want?

Based on electoral returns, tech is liberal. Ro Khanna represents Silicon Valley. Pramila Jayapal represents Seattle. Both are liberal Democrats. All the Senators from California and Washington state are also liberal Democrats.

That’s because the gating factor to tech growth is human capital. Tech needs a constant, rising supply of educated, motivated human minds. Never mind where they come from, their color or sexual orientation. Stephen Hawking meant more, in terms of human capital, than 1,000 able-bodied white bros. Tech doesn’t just need minds to program, but for marketing, management, policy, and a host of other jobs well-suited to those with liberal arts or humanities degrees.

The Republican Party has been wedded to oil since 1980, and their needs are different. When money comes out of the ground, what’s most important is holding that ground, and the infrastructure that turns that oil into profit. That’s why we’ve been in a state of constant war for 40 years. These have been wars for oil, wars meant to control the global economy. Generally, we won.

But tech can replace oil. Technology can replace any commodity. Tech doesn’t need government to protect its infrastructure. It needs government to educate people, to do the basic research that private companies can’t do, to maintain civil order and social peace. What tech wants is more attention paid to the environment because young people (and the best minds are young minds) want to eventually become old people, on a living planet.

It’s a limited agenda, but a liberal one, if only because Republicans are so completely committed to the interests of oil. Tech doesn’t want four more years of Trump any more than oil wanted four more years of Jimmy Carter. But from the perspective of Washington, where real news always arrives late, this doesn’t register. They only hear loudmouths and lobbyists and, while tech companies are now among the 20 largest lobbyists in Washington, lobbying is not where the action is.

The action is in tech’s own content reform efforts, and in those dark corners where strategies are conceived. Right now, tech’s money is mainly on Sen. Kamala Harris. But oil’s first choice in 1979 was John Connally, and its second choice, George Bush, only became Vice President in 1981. They’d like Harris, they’d take Biden, but if they’re stuck with Elizabeth Warren, they’ll make the best of it if they can have someone like Harris as vice president.

Meanwhile every action taken by the Trump Administration, whether against immigration, against science, against education, or against the environment, is being noted and toted up. We know that a political tsunami is coming. Now you know who will be left standing afterward.