When President Trump took office, it only made sense that he would court the burgeoning tech industry for advice. After all, his campaign was built on Silicon Valley-style disruption, his publicly stated preference was to use the most successful businesses as a model for government, and even some of his trusted advisers came straight from the Valley itself. Small wonder, then, that Trump not only brought in tech titans as partners, but delegated responsibility for integrating their insights into government to his son-in-law Jared Kushner’s new Office of American Innovation. It was perfectly sensible, if a bit naïve.
At this point, however, it is becoming clear that the tech industry’s sky high stocks don’t necessarily tell the full story about its economic strength. In fact, very soon, tech could become a sinking ship―and a sinking ship whose passengers hate President Trump’s guts. Rather than tossing them yet another life raft through influence in his administration, the President needs to be wary of supporting companies who could drag him down to the depths along with them.
There is ample reason to fear that tech will sink. The most recent evidence for such a fear comes in the form of a warning from Bank of America analyst Michael Hartnett, who treats the ever-increasing returns on tech stock as an example of “peak irrationality,” because tech could very soon crash in the same way as the 1997 dot com boom did. Hartnett is far from the only economist to be worried about the bubble-esque character of the modern tech industry. The Financial Times recently warned that tech stocks are entering “bubble territory.” The Seattle Times, meanwhile, points to the troubling rise of “unicorn startups,” IE startups who ludicrously mark up their private valuation, only to see their actual stock sell for vastly less. In the immortal words of Wendy’s, there’s ample reason to ask “Where’s the Beef” about such developments.
But it’s not just the economic power of tech that is arguably in a bubble: their political power could very easily be on the wane, not just nationally under Trump, but even among their allies on the Left. Hartnett warns that “renewed leadership of ‘creative disruption’ vs ‘economic nationalism’ is ultimately unsustainable.[…] It could ultimately lead to populist calls for redistribution of the increasingly concentrated wealth of Silicon Valley as the gap between tech capital and human capital grows ever-wider.” Late last year, and early this year, liberal outlets like the New Yorker and SumofUs attacked the Valley for its “empathy gap” toward the unfortunate, or issued thuggish warnings that working with the Trump administration would be “collaboration with hate.” Leftist author Jonathan Taplin slammed the Valley for hiding behind the fig-leaf of liberalism while really supporting Darwinian anarcho-libertarianism in his new book Move Fast and Break Things: How Facebook, Google, and Amazon Cornered Culture and Undermined Democracy. Combine this with the yawning income inequality and resentment that presently exists in the tech industry’s back yard, and you see why Breitbart recently warned, “America’s next social justice movement will be ‘Occupy Silicon Valley.’”
But it’s not just the economic power of tech that is arguably in a bubble: their political power could very easily be on the wane, not just nationally under Trump, but even among their allies on the Left . . . Combine this with the yawning income inequality and resentment that presently exists in the tech industry’s back yard, and you see why Breitbart recently warned, “America’s next social justice movement will be ‘Occupy Silicon Valley.’”
Ordinarily, the fact of an industry coming under potential attack from the social justice Left would be a signal to Trump that he should step in and defend them. There’s just one problem: Tech has shown absolutely no appetite to return the favor. Indeed, despite their being uniquely vulnerable to the very forces that Trump is most well-positioned to fight, tech companies seem to be caught in an increasing spiral of Trump Derangement Stockholm Syndrome.
Witness a story published late last month by The New York Times magazine, in which reporter Farhad Manjoo notes with some amazement, “In the 17 years I’ve spent covering Silicon Valley, I’ve never seen anything shake the place like [Trump’s] victory. In the span of a few months, the Valley has been transformed from a politically disengaged company town into a center of anti-Trump resistance and fear.” One overly excitable startup founder even anonymously told Manjoo that he thought Trump’s election heralded the coming of an apocalypse in a mere nine months. There’s Trump Derangement Syndrome, and then there’s flat out clinical delusion, and the tech sector seems to be teetering between the two even according to friendly outlets.
To be sure, there are exceptions. But these exceptions do nothing to soften the more important question of just what Trump gets from defending an industry that in some cases stabbed him in the back not three days into his term in office. The fact is that there’s no obvious reason that Trump should give the tech establishment the benefit of a doubt, least of all when it comes to comporting with his priorities. Kushner’s Office of American Innovation could obviously still retain a mission, particularly in making the government free from entanglements with unreliable and insecure services like Amazon’s Cloud computing technology. But at this point, and with a tech crash potentially down the road per Hartnett, the real mission of Trump’s engagement with tech should be to make it so his administration, and Washington more broadly, doesn’t need them anymore, if only to prove to the embattled industry how much they do need him.
Whether the White House will have the political appetite for such a shift is anyone’s guess. But those who want to see the President empowered rather than fettered to contemptuous and politically counterproductive “allies” should hope that they do. Otherwise, it may be not just Silicon Valley that the Left finds a way to occupy, but Trump’s own seat.