There is something deeply frightening about relying on billionaires to save us in this crisis. But what if we have no better choice?
The US government has repeatedly proven to be sluggish at best and impotent at worst at controlling the carnage of the coronavirus crisis. American deaths are now over 10,000, officials are comparing this week to 9/11 and Pearl Harbor, and at times it can feel like there are no leaders who can help.
But saviors, of a sort, loom: billionaires — and tech billionaires in particular.
Tech billionaires dominate the list of the world’s wealthiest people. And so Silicon Valley could not be better prepared to step into this void. And it has, even if unevenly: Companies like Apple have donated 20 million masks. Bill Gates is building factories to produce vaccines that don’t even exist yet. And other tech elites — think millionaires, not billionaires — have mobilized their networks for ambitious efforts to find equipment from around the globe or feed hospital workers in their hometowns.
But for all the wealthy’s good deeds, this status quo raises alarming questions about the long-term dangers of this dependency on this private sector and its generosity, especially about the world we’ll inherit once the dust settles. How can we be stronger the next time a pandemic, or any other crisis, strikes?
In conversations with philanthropists, wealth advisers, and billionaires over the last week, they described the uneasy bind to Recode: On one hand, tech billionaires are doing many helpful things. A nurse on the frontlines of the crisis probably couldn’t care less whether the mask that protects them came from Tim Cook or from Donald Trump — they’re just glad they have one.
But two things can be true at once: Tech billionaires can be doing good while simultaneously revealing their power and entrenching it for the long haul. As the government struggles and the safety net crumbles, tech billionaires are reaching the apex of their influence — influence that may not recede so easily once we do manage to survive this pandemic.
“If we need the resources now, but we’ll regret them having this power later,” asked Megan Tompkins-Stange, who studies the influence of the elite, “what does it mean for immediate suffering at the moment?”
“We do need billionaires to donate their resources when a state that has failed so abjectly,” she told Recode. “At the same time, opening up all these avenues for philanthropies to provide for the public need — even in the short term — provides more space for them after the crisis to leverage that into new democratic legitimacy.”
There are four interrelated spheres in which tech billionaires have commanded more plutocratic influence during this crisis: their philanthropic power, their corporate power, their political power and the power of their personal brands. We are living in their world more than ever, and it’s worth asking if that’s a good thing.
Over the past year or two, the world of billionaires has wrestled with a fresh, counter-intuitive question: Is it wrong for the mega-rich to give to charity? After all, they could just pay more in taxes instead.
But today’s crisis has laid bare how much we might need these billionaires in a specific moment: when the government is failing. And since philanthropists can only do so much, critics say that the crisis points to problems with our system more broadly — and that the US shouldn’t have to rely on charitable billionaires for masks or ventilators next time.
“Philanthropy is taking on a greater portion of the responsibility for response than anyone expected,” said Dustin Moskovitz, one of the founders of Facebook and one of Silicon Valley’s most thoughtful billionaire philanthropists. “Unfortunately I think it’s clear to anyone closely following the situation today that philanthropy simply can’t solve this crisis on its own.”
That’s true despite the number of Silicon Valley billionaires whose net worths have skyrocketed over the past decade. Some of them are so wealthy that even if they want to give their money away, they literally cannot dispense with their fortunes quickly enough. This has fueled the rise of charitable vehicles like donor-advised funds and thinned the line between a billionaire and an asset manager — both are overseeing vast financial empires. Advisors to tech billionaires, in particular, describe a paralysis: The nouveau riche don’t even know what to do with the money, so they stow it away, to be tapped later.
And yet the critique of billionaire philanthropy revolves around the idea that these donations are an expression of private power. Indeed, philanthropists like Moskovitz are some of the most important people in determining the shape of America’s response to an unprecedented crisis. They are imbued with unaccountable, untransparent, and undemocratic influence. Power grabs can happen. And their donations can legitimize the philanthropists as heroes, which can discourage scrutiny of their business practices.
But that general theory misses two things about this particular moment: First of all, while the donations certainly do offer a public-relations boon, much of the current philanthropic response — for pandemic models, for vaccine research, or for feeding the hungry — are not directly emboldening billionaires’ short-term grip on society, although questions about their taxes remain. And secondly, this critique can over-generalize the entire philanthropic response to the crisis by focusing solely on top-down efforts from billionaires.
Even if you hypothetically believe that the rich should be taxed at a much higher rate and that democratic leaders, not billionaires, should be the ones making funding decisions, it is not as if the tax code is going to be rewritten right now.
So in an emergency and with the government failing, you would certainly rather have, say, $25 million from Mark Zuckerberg for therapeutics research than not. The money donated by Zuckerberg or Gates or Moskovitz very well might save lives.
“Although I think concerns about the private sector and philanthropy doing what the government is supposed to be doing are somewhat valid, there isn’t a great alternative right now,” wrote Sam Altman, the former head of Y Combinator, on his blog as part of a plea for more private science funding.
Defenders of billionaire philanthropy often point to people like Gates, who is spending his fortune to create manufacturing capacity for seven possible different vaccines. Admirers say they would rather have Gates deploying his billions on that, rather than have him pay a few more tax dollars that would be lost in the federal bureaucracy.
That may be true, but it also gives them some indirect influence: Who elected Gates to be in charge of America’s vaccine production plan, even if he is savvily spending his money? The millions that Steve Ballmer has contributed to support communities in three particular cities close to his heart — Detroit, Los Angeles, and Seattle — will help, and so will the $100 million that Jeff Bezos is sending to food banks around the US, but who beyond them decided that these are the best uses of America’s resources?
Even Anand Giridharadas, among the most strident critics of billionaire mega-charity, thinks the gifts are welcome in an emergency. But he argues we still have to continue to ask questions about how we grew so dependent on them in the first place.
“We are now awash in press releases and narratives about billionaires stepping up. And there’s a little bit of a, ‘How do you like them billions?’ thing happening. Where because this is such a desperate, urgent, fast-moving moment, there is the ability of very rich people to act quickly and step into the breach and do stuff in a way that feels redemptive to many people, even though I think we should be more suspicious,” Giridharadas told Recode.
“While as a normal human being you celebrate someone buying a lot of masks quickly and donating them where an American state might take longer to get that done,” he explained, “It’s really important to ask why the crisis has hit us the way it has and the weaknesses it’s exposed. … A lot of those people stepping up are responsible for the underlying conditions of weakness.”
To Giridharadas, the real “stepping up” would come from billionaires renouncing the use of loopholes to evade taxes that weaken government’s revenue and ability to respond, to halt their use of offshore manufacturing that has hamstrung our domestic inventory of things like masks, and to campaign for stronger a social safety net with programs like universal healthcare.
“When you are talking about people dying on a minute-to-minute basis, there has to be some space to say, ‘Can we talk about this afterward?’ But I want to be very clear, given where I come from: We actually have to talk about it afterward,” Giridharadas said. ”I don’t think it is unkind to note those things while we are, as a society, taking some of their money.”
Secondly, not all donors are so easy to caricature as the critics suggest. It isn’t as if all of the people “stepping up” are power-hungry billionaires. In fact, some billionaires aren’t exerting power with their philanthropy for a different reason — because they’re not publicly doing much giving at all.
Jeff Richards, a venture capitalist, feels the conversation about Silicon Valley plutocratic power can be too focused on billionaires and can overlook efforts by ordinary tech leaders who are wealthy, yes, but hardly titans, such as efforts organized by another investor, Ryan Sarver, and former Twitter CEO Dick Costolo, to sponsor meals or restaurants.
“There’s no agenda. Neither of them are trying to build influence or build an empire or curry favor with politicians or anything like that,” Richards said. “I’m probably naive in that I believe that most of the things people do are from the goodness in their heart.”
And a related point: It might not be the case that billionaires are even donating as much as we’d think, which ironically means they aren’t grabbing as much influence along the way as we’d fear. Some of the most prominent tech billionaires, such as Google founders Sergey Brin and Larry Page, have so far proven to be MIA, at least publicly, amid the crisis. Representatives of the pair, who together control over $100 billion in assets, didn’t return requests for comment. And the gifts announced by people like Zuckerberg and Bezos are often astonishingly small percentages of their net worth, as critics on the left are quick to point out.
Still, it’s hard to know for sure. In the opaque, atomized world of philanthropy, it is always possible that donors are making major gifts that they don’t announce.
Activists worry that all this philanthropy could have an unintended — or perhaps perfectly intended — consequence: Political insulation for these billionaires’ corporations.
These good deeds could slow the building bipartisan scrutiny of these companies’ size, labor practices, and data scandals. It’s not as self-evident that Big Tech companies will come out of this with enhanced reputations — these companies could be on a path to ugly scrutiny over how they treat low-level employees, for instance. But some are concerned that Big Tech, after years on the defensive, will be able to “charity-wash” their reputations and build corporate goodwill through redemptive, headline-grabbing donations that help lower the temperature on, say, breaking up the tech companies at the end of this.
Big Tech’s billionaire class will have more power after the crisis than they had before, argues Sally Hubbard of the Open Market Institute. Brick-and-mortar retail is hemorrhaging jobs at a time when Amazon is adding hundreds of thousands of their own. Google is gaining even more of a foothold in the home as educators across the country deploy Google Classroom to teach students remotely — whether you want your family to use it or not. Officials, among others, from California Gov. Gavin Newsom to Vice President Mike Pence have repeatedly gone out of their way to offer thanks for the generosity of Cook and Zuckerberg — corporate leaders that they themselves will need to regulate for years to come.
Freada Kapor Klein, a tech philanthropist herself who worries deeply about tech philanthropists’ power, said she had applauded, for instance, the specifics of the two largest non-corporate gifts, the $100 million that Jeff Bezos and Bill Gates have each donated to charity. But she’s not naive.
“It enhances their legacy, their standing, the way to which they are revered. And sometimes that makes it harder to hold them accountable,” she said. “It’s not a critique of this gift or of them as individuals. It is a critique of the dynamic.”
At the very least, the pandemic is surely blotting out competing policy debates — after all, it is hard to focus on almost-academic concerns about tech monopolies amid tales of unprepared hospitals with rising body counts.
And yet Hubbard hopes questions about tech power will return either way.
“As one crisis comes and destroys so many people’s livelihoods, they’re going to say, ‘Wait, why were these the only companies that were strong enough to weather this?’” she said.
Linked to billionaires’ corporate power is their political power. This crisis has shown how tech billionaires have been able to leave their imprint on American policy. After years of building muscular lobbying operations around the globe, some billionaires are wielding and deploying that influence to push their points of view.
Take Larry Ellison. The founder of Oracle and one of the world’s wealthiest people, Ellison surprised many in Silicon Valley this February when he hosted a fundraiser for Trump that raised $7 million for his campaign, an event that undoubtedly strengthened his ties with the White House. That fundraiser followed years of Oracle’s Washington shop fostering particularly close ties with the administration.
Just one month later, Ellison was reportedly calling upon those ties to the administration to lobby Trump to push two unproven antimalarial drugs, chloroquine and hydroxychloroquine, as possible treatments for the coronavirus.
And that can be problematic for the rest of us — who don’t have lobbying operations or estates to host presidential fundraisers. Trump in recent days has begun pushing from the White House briefing room that Americans should take chloroquine and hydroxychloroquine, which some doctors worry could cause severe side effects and have little evidence of efficacy.
“My concern is when Donald Trump calls up Larry Ellison and says, ‘Hey, what do you think? What should I do?’ Because Larry Ellison is again not an infectious disease expert,” said Tompkins-Stange. “Larry Ellison is not accountable to a public that voted for him.”
To be sure, Tompkins-Stange said she wasn’t yet aware of other overt ways in which tech elites were undemocratically shaping US policy. There aren’t exactly press releases about this sort of stuff. But Ellison’s relationship with Trump offers a case study in how tech billionaires could use their wealth to create political power going forward.
“Larry Ellison,” Trump said Sunday from the briefing room. “Amazing guy.”
Power of personal brands
And then there is billionaires’ brand influence — unquantifiable, yes, but universally recognized. In short: When they speak, we listen.
Billionaires have for decades been our oracles and our rock stars, gracing gushing magazine covers, pacing commencement stages, selling how-to-get-rich-too books to the masses, and, more broadly, turning their money into cultural cachet.
And during a crisis — when people are so desperate for trustworthy information — these billionaires have filled the void, deploying their celebrity and credibility to try to spread good information. Some tech leaders, in fact, were among the earliest to sound the alarm about the risk of a global pandemic when the coronavirus was only spreading within China.
Despite all that good in the short term, this crisis could give these billionaires far greater influence in public life as our so-called thought leaders over the long term, enhancing the size of their platforms and the tenor of their reputations on matters far afield from tech.
It is Gates that has emerged as, by far, the most visible tech leader during this crisis. At a time when representatives for other tech billionaires are evading questions about what their bosses are doing in response, Gates has been seemingly everywhere, offering sober, apolitical analysis: Commanding 30 minutes in primetime on CNN. Offering solutions in The Washington Post and on The Daily Show. On Reddit AMAs and TED livestreams.
“At a time like this, we are searching for that kind of calm, clear leadership. Bill has been very consistent in his voice on these issues,” said Jeff Raikes, the former CEO of the Gates Foundation and still a close associate of Gates. “In a vacuum, then people like Bill [resonate more] if we don’t have that clarity of voice from our political leaders.”
Along with Gates, tech’s biggest celebrities have generally used their platforms and personal brands to draw attention to the crisis (with the exception of Elon Musk, who initially called it “dumb.”) Zuckerberg, for instance, has been hosting smart, responsible interviews on Facebook Live with people like National Institute of Allergy and Infectious Diseases Director Anthony Fauci and Newsom. Marc Benioff has used his megaphone to call on other CEOs to promise no major layoffs for three months and for other mayors to lock down their cities. While some would like to see these billionaires be more confrontational toward Trump, it’s hard to criticize all that they have done.
If tech leaders had an outsized voice in America before this crisis — they did, after all, invent some of the platforms — their brands have only been enhanced by it.
As is the case with their enhancement of their philanthropic, corporate, and political power, the question here to consider is: What is the alternative? It is understandable to be concerned about the enhanced influence of Silicon Valley’s wealthiest, but is that more concerning than the people who might die if its leaders didn’t make mega-donations, expand their company’s reach, or use their voice to speak to their followers?
If the powerful exerting their power to save lives brings them more power, there’s an argument to be made in three words: So be it.
But there is a tradeoff there that shouldn’t surprise us when this crisis is over and we see tech billionaires standing taller than ever in the rubble.
“We’re in a situation where we’re both reliant on the government than we’ve ever been,” said Richards, “but we’re also more reliant on the private sector than we’ve ever been.”
And at the end of this, our society may be more unequal, too.
Posts from the same category:
- None Found