HHardly a week goes by without another billionaire endorsing Donald Trump. Joe Biden’s proposal to impose a 25 percent tax on those with assets above $100m (PS80m) is not surprising. The real twist? The pro-Trump club of multimillionaires now includes an increasing number of venture capitalists. Venture capitalists are more progressive than hedge funders and private equity barons. They’ve positioned themselves as heroes of innovation and the Democrats have done the most to polish their progressive image. Why are they now cozying up to Trump?
Venture capitalists, Democrats and others have shared a belief in techno-solutionism for many years. They believed that digital technology could help markets achieve social goods, where government policies had failed. In the last two decades, this utopia has crumbled. We were promised that social media could topple dictators, that crypto could tackle poverty, and that AI can cure cancer. The progressive credentials of venture investors were only skin deep. Now that Biden is taking a more aggressive stance against Silicon Valley, the VCs are happy to support Trump and his Republicans.
Early 1980s was when the Democrats began to fall in love with techno-solutionism. Democrats saw Silicon Valley’s role in boosting environmentalism, worker autonomy, and global justice as crucial. Venture capitalists were the financial backers for this new, seemingly benign form of capitalism. They were essential to this vision. Democrats eventually acquiesced to Republican demands for measures that benefited the VC industry, such as changes to capital gains tax or liberalisation of pension fund laws. Democrats have actively promoted the agenda on issues such as intellectual properties.
This alliance has changed the way that the US finances innovation. Venture capitalists fund startups that commercialise basic science funded by public institutions like the National Science Foundation and National Institutes of Health. These startups then build on the intellectual property that has been licensed from grant recipients to design apps, gadgets, and drugs. Naturally, a large portion of these profits goes to venture capitalists, who own stakes in these startups. This model has led to Americans paying some of the most expensive drug prices in the entire world. Yet, when politicians have attempted to curb this egregious outcome, they have been greeted with accusations from VC industry.
Venture capitalists are keen to highlight the role they play in driving progress. Through podcasts and publications, they have successfully recasting their interests as those that benefit humanity. The Techno-Optimist Manifesto is a 5,200-word document written by Marc Andreessen. He is the co-founder of Andreessen Horowitz, a VC firm. Its jarring universalism suggests that we are all in this together – San Francisco’s venture-capitalists and the homeless. Andreessen encourages readers to join venture investors as “allies” in the pursuit for technology, abundance, life. His text quickly reveals the truth. He writes that “free markets” are the most effective way of organising a technological economy. (Andreessen has criticised Biden, without endorsing Trump.
Andreessen doesn’t celebrate technology in the abstract. He promotes what he calls the “techno-capital machines”. This system allows him to reap the benefits of innovation while steering it in a direction that prevents alternative models from Silicon Valley hegemony from achieving the kind of adoption that would allow for-profit solutions to be displaced. Andresseen is no different from other VCs in that they never stop to consider the possibility that a more efficient technological economy may not be based on free markets. How can VCs claim that treating data as a common good will not lead to a more effective generative AI or less destructive social media platforms?
The tragedy is we won’t try anything like this anytime soon. We’re trapped by a worldview which has led us to believe that there is no other option to a system which relies on poorly-paid workers in the global South to assemble devices and moderate content, and consumes unsustainable amounts of energy to train AI and mine bitcoin. Even the idea that social networks might promote democracy is now abandoned. Instead, tech leaders appear more concerned about avoiding responsibility for their platforms’ role in subverting democratic processes and fanning flames of genocide.
Where can we find this much-needed alternative to the current system? While researching for my latest podcast A Sense of Rebellion I came across a series of 1970s debates that pointed me in the right directions. Back then, a small group of hippy radicals were advocating for “ecological technology” and “counter-technology”. They didn’t want to merely make existing tools more transparent and accessible. They wanted to fundamentally change the system. I found a compelling example of such thinking in a quirky manifesto from 1971, published in Radical Software ,a small yet influential magazine. The author of the manifesto was anonymous and signed as “Aquarius Project”, with only a Berkeley postal box listed. I tracked them down partly because their points in the manifesto are often forgotten in today’s debates on Silicon Valley. They wrote: “‘Technology does nothing’, it creates no problems and has no ‘imperatives.'” “Our problem isn’t ‘Technology,’ but capitalist technology.”
The group, being hippies, struggled to translate their insights into policy requests. Someone else had done it three decades earlier. In the late 1940s the Democratic Senator Harley Kilgore recognized the dangers that postwar science would become “the handmaiden of corporate or industrial research”. He envisioned an NSF governed by representatives of unions, consumers and agriculture, and industry, to ensure that technology served social needs while remaining under democratic control. If they based their research on public research, corporations would have to share their IP and be prevented from being the only providers of “solutions” for social problems. His model was ultimately defeated because of its emphasis on democratic oversight and the sharing of IP riches.
Our current approach to innovation allows scientists to set their own priorities and does not require that companies that benefit from research funded by the public share their intellectual property. We must now ask if this approach is still valid, as Biden’s chips act directs 81bn dollars to the NSF. Shouldn’t democratic decisions guide how this money will be spent? What about the IP generated? How much will venture capitalists end up gaining? Data and AI raise similar questions. Should big tech companies be allowed to use public data to create lucrative AI models that are owned by private firms? Why not make data available to universities and nonprofits? Why should companies like OpenAI, which is backed by venture capital dominate this space?
The AI gold rush of today is inefficient and irrational. A single, authoritative, public curator of the data behind generative AI would do a better and more efficient job, saving both money and resources. It could charge corporations to access the data, while offering cheaper access to libraries and public media organisations. Silicon Valley’s merchants are leading us in the opposite directions. They are obsessed with accelerating Andreessen’s “techno capital machine”, which relies upon detaching markets from democratic control. With Trump in the White House they will not waste time repurposing tools to serve authoritarianism, just as they did for the neoliberal agendas set by his Democratic predecessors.
Biden and his supporters should recognize venture capitalists are a problem, and not a solution. The sooner progressive forces can get over their fascination for Silicon Valley, better. It won’t suffice: To build a truly progressive tech-public machine, it is necessary to rethink the relation between science and technology and democracy and equality. It’s okay if that means reopening debates that were once settled.
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Evgeny Morozov has written several books on technology and political issues. His latest podcast A Sense of Rebellion is now available.
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