Tech billionaires like Elon Musk and Mark Zuckerberg are aligning themselves with authoritarian governments. Not only are they helping to solidify the power of autocrats like Xi Jinping and Vladimir Putin, but they are also endangering the political freedom of our Western democracies.
When Google and Facebook were established, they looked like progressive social forces that would cleave to enlightened labor practices and an open information regime. The expansion of the Internet and social media meant expansion of democracy, no questions asked.
Amazon seemed like it would carry enlightened labor practices into the new economy. Tesla entered the scene as a killer of fossil fuel giants, seemingly a proponent of progressive ideas about climate change. Here was a high-tech visionary company aligned with progressive goals.
Yet as their founders entered the ranks of billionaires, all these companies became cheerleaders for regressive social and economic policies.
The only surprising thing is that this should be surprising.
Political autocrats and billionaire entrepreneurs enjoy a symbiosis so commonplace that it is little noticed. Mark Zuckerberg’s role as a «useful idiot» in the 2016 election of Donald Trump is well understood, as are the roles of financiers like Sheldon Adelson, the Koch brothers, Steve Mnuchin, Peter Thiel, Doug Leone of Sequoia Capital, Brian Krzanich of Intel.
In 1933, Germany’s major firms established an «Adolph Hitler Donation» fund to which they made annual contributions. Nothing about big businesses in 1930s Germany suggests that they had a great personal affinity for Hitler and Naziism, any more than the oligarchs who emerged in Russia after the collapse of the Soviet Union personally admired and supported Vladimir Putin.
In fact, there is good evidence that the most influential of the Russian oligarchs took Putin for a colorless and passive tool who could be molded to their needs. Likewise, many if not most of America’s leading fund managers and industrial leaders who supported Trump did so holding their noses in expectation of tax cuts and an accommodating regulatory environment, if not actual handouts and massive government spending into their pockets.
Billionaire industrialists seldom sign onto particular political programs. What autocrats from Hitler to Trump to Xi Jinping achieve for the ultra-wealthy within their own countries is a demobilization of public opposition that leads to the hobbling of labor unions, a reduction in regulatory oversight, and of course lower taxes for the wealthy and a reduction in the redistributive goals of government.
An alliance between capital and the right is natural; what has changed since the tech era began in about 1990 is the close ties created by the Internet and other globalization forces between financial titans and leaders of sizeable economies around the world.
With those links came a need for these business leaders to express their fealty and alignment with foreign autocrats. Look no further than Jack Ma’s meeting with Donald Trump two weeks before Trump’s inauguration, in which Ma casually promised to deliver one million jobs to the United States.
«Free America Now!» tweeted Elon Musk in April 2020, as he refused to close the Tesla factory in California to protect workers from Covid-19. He later called U.S. virus restrictions «fascist.» But Musk did not complain when the Chinese government ordered Tesla’s Shanghai factory to close, calling the disruption «slight» and saying China’s Covid management was better than that of the United States.
Expressions of admiration for autocrats have served Musk well, and they legitimize the autocrats at home and abroad. Tesla has received tax breaks, cheap land, and at least $1.6 billion in state-bank loans in China. Through his company SpaceX, Musk is a defense contractor, so it is not surprising to find him praising the Russian space agency. «Russia has excellent rocket engineering & best engine currently flying,» Musk tweeted in March 2019.
In the ramp up to Hong Kong's hand back to the Mainland in 1997, Hong Kong's billionaires were among the most eager to align with the top Party leaders in Beijing. Mark Zuckerberg in 2015 fawned on Xi Jinping by buying 500 copies of his book, making it mandatory reading for Facebook's top executives, and requesting that Xi give a Chinese name to Zuckerberg’s baby girl. Musk, who has been a promoter of Vladimir Putin, recently invited the Russian president to a chat on Clubhouse.
Starbucks founder Howard Schultz publicly congratulated Xi Jinping on China’s transition to a «moderately prosperous society,» a Chinese political buzz phrase since the time of Hu Jintao, and Xi responded this January by penning a public letter to Schultz telling him that Starbucks could «promote China-U.S. trade and economic cooperation» and get beyond the current trade and investment frictions.
Such public compliments carry tremendous weight in China. Just as Ivanka Trump was granted a suite of trademarks as her father assumed the presidency in the United States, Starbucks executives will find open doors and ready subsidies wherever they choose to open throughout China. Local officials hoping to attract notice from the top would be foolish to do anything else.
In the past, the alliance between capital and political power was generally confined to large monopoly industries whose profits depended on political favor – think copper in Chile, tobacco in China, oil wherever it is found. But monetary expansion since the Global Financial Crisis has engendered massive private fortunes in technology companies that never before looked like piggy banks for autocrats.
Now, the fortunes amassed by people like Musk, Zuckerberg, Jeff Bezos, and Jack Ma make the personal treasuries of kleptocrats like Papa and Baby Doc Duvalier of Haiti or Ferdinand and Imelda Marcos of the Philippines look puny and unimaginative.
Shoring up and retaining their fortunes requires that these recently minted private billionaires align themselves politically and commercially with strongmen. Security spends increasingly are directed at domestic tranquility while the battlefronts abroad are about winning cash flows.
There are risks to the individuals playing in this arena, and there are risks to the democratic processes in their countries. Zuckerberg and Musk need only look east to Russia now, at the fates of people like Boris Berezovsky and Mikhail Khodorkovsky, or to China, where stupendously powerful people like Guo Guangchang, Wu Xiaohui, and Jack Ma have disappeared while «assisting investigations» to grasp how dangerous these alliances can be.
Commercial interests are always secondary to continuing political power for autocrats, and at a certain point, wealth that enables them can morph into wealth that endangers them, especially in nations with weak institutional safeguards around things like elections.
The fact that many tech billionaires have established powerful Internet and print media platforms adds to both their appeal to autocrats and the risk of increased dependency. But while they remain in favor, billionaires seldom can bring themselves to give up the delicious taste of unfettered power.
These phenomena of rapid wealth aggregation, globalization, and coziness between the hyper-wealthy and autocrats have been revealed, with compelling clarity, to be a fundamental threat to democracies. The cost of dictatorship is always borne by the poorest citizens, from whom escalating extractions are required to maintain patronage and power at the top.
That inevitably requires a loss of political power for the majority, even in systems where top leaders are ostensibly chosen by a voting majority. Innovations in voting polities where the majority voice has to be suppressed come in the form of outright fraudulent elections, such as we see in Russia or Belarus, or intensive manipulation with media control and voter suppression, such as we see in more established democracies like the U.S. and U.K.
For democracies, the only effective response is not Amazon’s «trust my labor practices» or Google’s «Don’t Be Evil», but in a combination of vigorous anti-monopoly enforcement, redistributive taxation, and curtailment of the power of money and bold media power, what we have come to call «dark money,» as tools wielded by a very few at the expense of the many.
With the richest 1% in the world holding half of all assets, the hill to climb for potential new democracies, not to mention maintaining existing ones, is steep indeed.