Mark Zuckerberg, Jeff Bezos, Bill Gates, and other billionaires have figured out a pretty sweet deal, Anand Giridharadas says: They make gigantic piles of money, and have tricked politicians and the media into giving them an exceptionally loud voice in policy discussions. What’s their secret? Just give away a little bit of that money through philanthropic organizations that they control.
“This is a refeudalization,” Giridharadas said. “If you watch Downton Abbey, you understand the idea. There’s a guy in a castle, and then no one else owns land in the show.
“[Zuckerberg is] trying to get rid of all the world’s diseases, as if public education wasn’t a hard enough problem,” he added. “We have doctors. We have an entire public health infrastructure. We have the Centers for Disease Control. We have the NIH. But no, Mark is going to get rid of all the diseases, even though his own company is a plague, by any stretch of the imagination.”
On the new podcast, Giridharadas characterized the power of Zuckerberg and his peers in policy discussions as the result of a “40-year war on the idea of government.” It’s fine for billionaires to have opinions on things like medicine and education — but, he asked, why should they be treated as sagacious experts when they come from a completely different arena?
“Why do we actually bother, fuss so much about voting rights?” he asked. “Why is it so important that a relatively small number of people not get turned away at the polls, right? Why was it important to fight for women’s suffrage? If we create this entire system where the choices about our biggest shared problems are made by us, but then we create this other door to the nightclub of democracy where only people with a billion dollars can come in, they can just also sort of overrule us on a bunch of things.”
Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Anand.
Kara Swisher: Thank you, everybody. Thank you for coming to this place. This is lovely, actually. I’m sort of amazed by it. I want to introduce Anand Giridharadas. Is that right?
Anand Giridharadas: You did a fantastic job.
Thank you very much. We’re going to talk about a lot of things, substantively. Have a seat, Anand. You can relax.
I can never quite relax around you.
You’ve destroyed so many tech barons.
Yes, that’s true. But you’re not one of them. So, we share something in common about what we want to do to them.
I am so glad to be here in New York. We’re taping a lot of Recode Decodes on the road because we really think ... One of the things that we made a bet on when we started the Recode Decode podcast was that people like substance in this twitchy, horrible time, and want to talk substantively with great about people about important issues.
And so, we’ve been doing tons and tons of live podcasts all over the country. And we’re going to be doing more as we move forward, because we think it’s super important to address some issues, both with the players and other people who are critics of the players. And so I’m very excited to talk to Anand, because we did a podcast … how long ago?
Six, seven months ago?
Six months, about this topic that has suddenly gotten very big, which is what to do about tech, what to do about big tech, what to do about really rich people ruining the world, essentially. And so we’re going to talk about that. So, thank you for coming. Six months ago you started ... you did this ... I’m going to turn off my phone now.
You can take it if you need to.
No, it’s okay. It’s not Sheryl Sandberg right now. It could be. Talk a little bit about your book and why you started to do it, for people who aren’t familiar with Winners Take All.
I think I observed something that probably many of you have observed one way or another, which is that we live in this time in which, on the one hand, very rich people are extraordinarily generous and socially concerned. And it’s not only lip service, right? It’s not only all the hippie imagery that we see in a WeWork.
It is more money being given away than has ever been given away in the history of the world. That’s real, right? It’s a lot of the tech companies that you’ve spent so long writing about that genuinely have civilizational missions and have done genuine good for the world, while also doing other stuff. And it is a product. You can’t go shopping without finding socks that are going to change the world, tote bags that are going to change the world. Kick in two bucks at Walgreens, Bono was involved in all of it.
Impact in the hardest-hearted business people on earth now feel a need to not just do it investing, but impact investing. Right? And they want to empower humanity. Unless you’re Bill McGlashan, you’re doing impact investing, but you don’t want people to be empowering to compete with your son for that seat that you bribed for him.
We’ll get to him.
So that’s all true, an age of extraordinary league generosity. But does the other half of the story, which this is also an age of extraordinary elite hoarding. People use the word “inequality.” I think it makes people’s eyes glaze over. Inequality is just a gap. There’s all kinds of gaps. Everywhere has a gap. I think what has happened in America is more specific.
The rainwater of the future has been abundant in the last 30 or 40 years. If you look at Spain, a country like that’s a different situation. I don’t think Spain has been rained on by a lot of future in the last 30 to 40 years. As you know better than anybody in this room, we’ve got a lot of future in this country.
Yes, we do.
Innovation’s a Latin word for “new shit.” We’ve had a lot of new shit in this country in the last 30 or 40 years. It’s just that very few have monopolized the gains. That’s true of tech. It’s also true, by the way, of this thing in the news this week, Chinese trade.
America, as a whole, has benefited from trading with the Chinese. Investors have benefited, companies have benefited, consumers have benefited. It was just that we totally failed to redistribute the gains from the country trading with China. And that has been the case everywhere.
So, I tried to start the book with the question, what is the relationship between the extraordinary elite generosity of our time, which is real, and the extraordinary elite hoarding of our time, the monopolization of the future itself?
And I think the conventional theory out there is that the relationship is one of a drop in the bucket. That, yes we do have these big problems, but these people are trying. Zuck is trying, the Google people are trying, the Wall Street people are trying, the Goldman Sachs people doing social impact bonds are trying. If only there were more of them and they had more billions and they tried harder and they crunched their spreadsheets in new ways, they could solve these problems.
And I started to become curious about an opposite possibility, which is that maybe the extraordinary elite generosity of our time is how we maintain the extraordinary elite hoarding of our time. Maybe the generosity is the wingman of the injustice, and the making a difference is the wingman of making a killing. And the giving back is a wingman of taking ruthlessly. And I reported it out, because like you, I’m a reporter. I went into these worlds and I found it to be, unfortunately, true.
True, that this is linked together? That this is just a ... you’d rather them just keep their dirty money, essentially?
This is a very good question. So the easiest and the most immediate pushback I often get is like, “What, do you prefer that they just bought a yacht?” So it’s a complicated question, right? I think most people’s intuition is, “Well, that would never be better. At least they’re doing something,” even if you’re sympathetic to my view.
So let’s take ... actually, I think in some cases, of course we’d do better off with them at least trying to do something than buying a yacht. In some cases. I think there are other cases where that’s actually not true. So let’s take three, one very quickly. The Sacklers. No one likes the Sacklers because, honestly, like 400,000 people killed in your country is sort of genocide numbers. So it’s not been an attractive family.
For those not keeping up — opiates. Go ahead.
So the Sacklers made billions and billions of dollars, members of that family, by selling Oxycontin. And now, as accused by several states, including the State of New York, knowingly pushing something they knew had problems, they knew it was more addictive, deceiving people, etc. So you make billions.
And then they spent millions philanthropically. Art museums, everywhere, right? They don’t donate to art museums in the communities they’re hurting. They donate to art museums in places where people like you and me live. We know not to ... We think that they’re good people, all the big cities, the places where the journalists live, the regulators live. And they did this for a long time.
So now you say, okay, would we have been better off if the Sacklers had just bought yachts? I would argue yes, because what would have happened if they’d bought yachts? They would have been doing this stuff with their business. People would have been dying and they would’ve had no reputational cover. Regulators would not have thought of them as “the art family.” Journalists wouldn’t have thought of them as an art family.
When I was growing up in Washington, DC, this thing was going on. I didn’t know about that. I just knew about the Sackler Gallery. And I believe it is plausible that regulators and journalists would have come for them way earlier if they had not had the moral glow purchased through philanthropy.
Mark Zuckerberg, same story. If he didn’t have the change-the-world vibe, if we saw him the way we see anybody buying stuff for a dollar and selling for two in this country. I’m not saying he’s an evil person, I’m just not saying [he’s] a sage. If we saw him the way you see someone in the chemical company, right? If that had been our image of him for the last 20 years, you think you would’ve gotten away with this shit?
Well, we’ll get to him in a second. Actually, let’s get him right now.
She says, yeah.
Let’s get to him right now. Do you ...
It’s never too early or late.
He has not been, as most of the tech people have not been as philanthropic. Gates was the first one who really started and shifted his image really drastically from sort of ...
Well, Darth Vader, I was thinking, to a more ... It’s interesting, because he was the apex predator. He was the one that you couldn’t do ... you couldn’t make a move in tech. And everyone had that image of him from the very beginning, not as a sweet, sweatshirt-wearing young man. As sort of a nasty nerd, really, who decided to kill you, he would do it. And you couldn’t start a business without him doing it.
That was his reputation from the get-go, besides being the world’s richest man. And aside from the odd little, like, he takes coach or whatever, those kinds of stories, which are entirely untrue, he was not seen that way.
He takes a coach, on his private jet.
He takes a coach. But yeah, that’d be funny if he had a coach, like with horses and everything.
A personality coach.
Yeah. Well no, he doesn’t have that. So … sorry. I shouldn’t, I shouldn’t make ...
I’m wondering when he’s going to revoke the blurb on my book.
He already call me a “communist” when he was at Davos.
Okay, good. Which you clearly are. So he started this off, this philanthropy, but most of tech hadn’t been that philanthropic in the way the Sacklers had been, and some others. But go through Mark. So Mark, the reason ...
But Mark made that big announcement of that letter to his daughter. That they were going to give away 99 percent of the shares, which is, I think, maybe the biggest statement in the tech world where someone had, after Gates, this younger group had done it. Except they were going to do it through an LLC, which is, you know, slightly weird modality.
But they’re definitely doing stuff. And I meet public school teachers all the time whose lives are being upended by Mark’s ideas about public schools. Because part of what I’m really writing about is a culture, not just a set of practices. A culture in which we think people who have made a lot of money should have thoughts about everything, and that those thoughts should be the law.
So Mark Zuckerberg, as far as I understand it, wanted to build a social network to help people at Harvard meet each other. He ended up being the most dangerous person in the world. And now, incidentally, as a byproduct of that, gets to have thoughts about how public schools are in America. They have tech companies in Germany. I don’t think anybody in the German Education Ministry is curious about the thoughts of German social networking CEOs about education. They’re allowed to exist. I don’t know.
I think Mark Zuckerberg should legally be allowed to have thoughts about education. I just don’t think they should have any more weight than he is able to express through voting every two or four years.
So nonetheless, he comes with him quite a lot of cash. And I think a lot of ... Go through what happened here in Newark. There was a huge announcement. It was on Oprah. It was everywhere, that he was giving this money. Cory Booker was right in there with him, who’s running for president. “I’m going to give this much money to fix schools in Newark.”
Mark Zuckerberg’s Newark donation was, in some ways, modeled after another great philanthropist, Christopher Columbus, who also decided to change a place without having been there before and didn’t seem to know much about ... kind of saw it as a blank slate, which is more his own blank list ...
It’s a mess. Yeah.
... projected onto what he found. And so Mark Zuckerberg, having never been to Newark, goes on Oprah, makes this announcement. We are going to transform Newark,” and $100 million dollars, right? And by all accounts, it literally did nothing. The money disappeared. I mean, it just, it did nothing.
And what is so remarkable about that is how obvious it is. This is the whole reason that we transitioned over hundreds of years out of feudalism to democracy. We have actually ... this thing is not new that they’re trying to do. It’s old. This is a refeudalization.
If you watch Downton Abbey, you understand the idea. There’s a guy in a castle, and then no one else owns land in the show. And any time that people who don’t own land get a weird idea about how maybe they should own stuff too, they die in a car accident. And the rich people are nice, but they’re in charge of how the help works. They’re in charge of shaping the society through their kindness, through their generosity. And this is the Zuckerberg model.
And now it extends... He’s trying to get rid of all the world’s diseases, as if public education wasn’t a hard enough problem. I just think, “How remarkable.” We have doctors. He may not be aware of them, but we have some. His wife is one. We have an entire public health infrastructure. We have the Centers for Disease Control. We have the NIH. But no, Mark is going to get rid of all the diseases, even though his own company is a plague, by any stretch of the imagination.
OK, that was a setup. So why do you think, as you were doing this book, you ... Where is the mentality for it from? Because we have a history, also in this country... You had Andrew Carnegie or the Fords or these old foundations, which now seem rather pleasant, in terms of what they did, whether it was libraries, or the Ford Foundation continues. All these, even the Pulitzer Prizes was ... their origin is not the greatest origin. Talk a little bit about this. This is something we are used to in this country. It’s where the very wealthy people give back.
You’re totally right, but there’s an interesting arc to the story. So this really began a hundred years ago, where you started to have these fortunes that were what we’d call billionaires today. Not just people who are rich.
But really, essentially, when they started becoming interested in giving money away, the way historians define this in philanthropy is they started to have enough money to be able to do the kinds of things that governments do, right? That’s one way to think of ... and that was really 100 years ago. It was not benevolent associations and these things. It was someone who could really privately govern.
And Carnegie wrote this incredibly important thing called the Gospel of Wealth, which many of you may have studied in high school or college, in which he laid out what has become the intellectual foundation for moneymaking and money giving. And it was basically a truce.
It basically said ... The argument’s in two parts. Part one, “making money is super hard. It’s a jungle out there. You got to leave us alone. We’ve got to pay people as little as possible. Maybe we can’t pay our taxes as much as you’d like. It’s just, no judgment. Making money is hard. If we don’t do all this stuff, someone’s going to eat our lunch.” You know this argument from everybody in the Valley, who always thinks they’re about to be eaten.
And what was radical about Carnegie on the other side is he said, however, when we then make a bunch of money from being left alone in the jungle, that money actually doesn’t belong to us. Right? We are mere trustees of that wealth and have to spend it on the public good — and do it within our lifetimes. You can’t inherit. So he was a justifier of the most ruthless capitalism. However, he also advocated for a pretty radical mode of giving.
A lot of rich people today really remember the first part of Carnegie but have kind of forgotten the second part. But he laid out this bargain that I think has ruled until today, where if they give back, that buys them immunity from questions about how they made the money, how they keep the money. We’re talking about taxes, we’re talking about wages, we’re talking about what you lobby for in Washington.
There has been this silent bargain that all of us have participated in — frankly, the media has participated in — that generosity entitles you to a little bit of a suspension of scrutiny. And what was really interesting 100 years ago when this was getting started was, it took time for this immunity to develop.
When Rockefeller proposed a foundation in 1909 to create the first foundation of that kind, there was no legal structure for it. 501, whatever. All the stuff we have now didn’t exist. So he was trying to figure out what’s ... he asked Congress. Congress said, “No, you can’t create a structure to give your money away.” Can you imagine that today? Why? Because they didn’t want him exerting that much power over public life.
He came back a year later, this is one of the most amazing documents I’ve ever read, with a counterproposal to Congress: “I’ve heard you, I understand you’re concerned about one private citizen governing privately. You’re right. Here’s a counterproposal for a new idea for a charter, and this should actually become a reclaimed heritage.” He proposed, in various ways, in great detail, a way to do a foundation where the public would have some say over it.
If the Congress or subcommittee it created decided that this foundation was no longer doing better at giving away money privately than say, Congress, it could just put the money into the treasury, right? It could dissolve it. It could create committees to help the public, to help allocate the money. So it wouldn’t just be some private guy and his nieces and nephews and children allocating the money.
That whole heritage of skepticism that ... and people, even Theodore Roosevelt saying, “no amount of generosity can excuse how the money was made.” Even Democrats don’t talk like that anymore, right? Everybody’s for these people giving back.
And basically what happened was that initial wave of skepticism gave way to those people spending a lot of money. And every institution in this country, one way or another, started to be a beneficiary of that money. And lo and behold, you start bribing society at large. People start to develop a very positive idea of you. And part of what I, and there’s several others who write in parallel with me, have been trying to do is to say a lot of this philanthropy, a lot of this do-gooding impact investing is basically trickle-down economics with a cherry on top and a little bit of whipped cream.
Right. What do you imagine they should do with their money then? First of all, right now, Mark and others in tech, for example, who have all the money, who have obscene amounts of money, actually, are in trouble for how their businesses are operating, which will probably never impact what they’re making. What do you imagine ... So, when they get that rich, they’re like, “We have to give away the money.” How do you change it? How do you get to that first idea that Ford had, which would be the correct one, where you don’t give these people more power on the other side than we’ve already given them in the first place?
Well, first of all, the question in that world that everybody loves to ask, and, I think, very rich people in general is like, “What can I do? What can I start? What new thing can I do?”
And so, the first thing I would say to them is, you know, to flip around John Kennedy, “Ask not what you can do for your country. Ask what you’ve done to your country.” These people love being future-oriented because that kind of prevents us from being past-oriented.
Yeah, I’m aware of that.
Right? So I’m more interested in Zuckerberg ceasing and desisting from doing a bunch of things, and I’m happy to give him a list, and you have an even better list than me. I’m way more interested in that than I am in what prospective things he can do. I’m happy to let public schools, principals, and teachers go back to just running their own show. I think we’ll be okay.
And I would love him to actually stop abusing our privacy, stop compromising our democracy, let government in to regulate what it needs to regulate, not lobby against that in Washington with that stooge who sat behind him. I think what a lot of these folks do is these modest acts of do-gooding, and then they lobby for stuff in Washington.
Just lobbying on its own, that has a thousandfold the impact of the good. I’ll give you one example. So, Pepsi and Coke, right? They all build playgrounds. They make the smaller cans now so you got to drink two to get diabetes. So, that’s great. And they run these ads, “we’re basically a water company,” you know, “with sugar in the water.” But, it was revealed during the Trump trade negotiations with the renegotiation of the treaty with the Mexicans, that one of the things that I think these beverage companies and American food companies were pushing, and the Trump administration took their request to the Mexicans, was to remove the Mexicans’ right, as a democracy, to put nutrition labels on a bunch of products.
Can you imagine that for a second? Under this deal, if the Mexican government representing their people had wanted to put informative labeling on it, they wouldn’t be able to because an American company had persuaded the American government to prevent the Mexican government from doing what its people wanted to do under a democracy. Right? And then you wonder why people are angry in this age we’re in.
So, I don’t need Pepsi and Coca-Cola’s playgrounds to help 1,000th of 1 percent of the kids they have harmed lose a little weight. I need them to not do the things they’re doing right now, and the real way to have them do that is to have government play a way more assertive role in public life and stop trusting the foxes to be the hen keepers.
Is there any of these efforts that you think work? With Bill Gates, for example, what they’re doing.
Sure. So, one of the easier cases is places where government is not functional. So, when you’re giving money to places, as he does, he also does a lot here, but when you’re giving money to places where, frankly, government could never solve that problem, I think it’s much easier to justify.
By the way, I still think there’s a lot of questions around being paternalistic, being imperialistic, how you do it, etc., etc., centering human beings, centering communities versus just dictating. All of that still applies. But the case for crowding out public capacity in places where there is no public capacity is stronger. Where you’re redesigning common core here, you’re designing common core ...
Whether it’s education, or ...
You’re jamming it down a bunch of state legislatures without a vote, right? And then people are getting angry. I think there’s a lot less of a justification for that. And people often bring up Gates to me, because Gates is not the Sacklers. I don’t even think he’s necessarily Zuck. But I think even if you invent someone who made their money perfectly — didn’t harm anybody, wasn’t Darth Vader — even in that case, the question people often ask me, “So, is there any problem with that?” Right?
Let’s imagine someone who really is not ... Serena Williams, just makes a lot of money and decides she wants to transform public schools.
Everybody likes Serena Williams.
Even if there’s no problem in that case with how the money was made, there’s no problem with any of that stuff.
She hit the ball. That was it.
There’s still a question of should any one person, however amazing, have that much say over public life? And the question it raises for me is, why do we actually bother, fuss so much about voting rights? Why is it so important that a relatively small number of people not get turned away at the polls, right? Why is it important that we fought against poll taxes and all this stuff? Why was it important to fight for women’s suffrage?
If we create this entire system where the choices about our biggest shared problems are made by us, but then we create this other door to the nightclub of democracy where only people with a billion dollars can come in, and they can just also sort of overrule us on a bunch of things ...
So, even if it was someone with ... nobody should have this role over public life. What would you do with their money? Just tax it and then ...
We should just tax it more heavily.
Right? First of all. And there’s pretty good evidence that places that tax more of it just have more dignity and decency. People want to tell you that that’s a mystery and we don’t really know, but we know. Many people in this room have probably been to those countries. It’s just different there. So, that’s one thing.
I remember when I lived in England for a year, and England’s pretty free-market in the European spectrum, but less so than us. I lived in England. I got sick. I went to the doctor. And afterward, I was like, “So how do we settle this out? I don’t know.” And they were like, “Just go home.” And not only was it free, I remember, that moment, there was an expressive, I thought the society was expressing itself to me.
It was expressing its values in the transaction, in the absence of a transaction. There was moral meaning in the person saying to me, who wasn’t a citizen, who’s not even technically a resident, I was a student there. They didn’t even know any of that. That was just a person who looked like someone maybe they’d colonized, and from another country they’d colonized. It’s always a safe bet there. And they were just like, “We got it.” And it’s just like, that’s the, like, we got ...
So, it should be the government that you hired that should be doing this.
And to be clear, I’m just talking about our biggest shared problems.
I don’t want my phone to be made by the government. I don’t want my airplanes to be made by the government. I don’t want these chairs to be made by the government. What we are really talking about is the commons, is the stuff, frankly, that the systems, the infrastructure, social, physical, that we are powerless to do alone.
But the commons has changed into a private thing. I think I just wrote about this last week, that the public square is not Twitter, for example, or Facebook, but it’s become that. That we’ve allowed, for example, political discourse to, because it affects everything, in that ...
Yes. The commons is not privately owned any more, whether it’s an online commons, or toll roads are a different ... I think what we don’t sometimes realize is we’ve been on the receiving end of a 40-year war on the idea of government, not just on government, on the idea of government. And this is an ideology, the way any fundamental ... it’s a market fundamentalism. I call it capital supremacy, right?
And like every other supremacy, it excludes and marginalizes every other thing that’s not its reality. And so, in this culture, money was good, entrepreneurs are good, businesses are good, government is bad, public purpose, bad, private gain, good. And so on and so forth. This shaped everything. It shaped what people wanted to do when they were graduating from college.
And also there’s an element of “technology will fix it,” too.
Because that’s an overriding part of it, is that ...
Remember what Gates said?
So many things. Which one?
So many things. “We have all these hierarchies in the physical world, but when tech comes in, tech doesn’t care who you are. It’s just going to eliminate those hierarchies from the physical world.” What an extraordinarily naïve thing to say from the standpoint of 2019 by a man who was brilliant and meant well by saying that. But, I think, was fully unable to understand, if you take a historical view rather than a computer science view, most new tools submit to the existing power situation, right?
New tools don’t change everything. Nothing changes everything. You only think something changes everything if you’re a computer science degree and you dropped out two years early, right? These people need to all go back to school and get a liberal arts degree.
Well, you know that. You know I think that. So, if we’re in this state where people do welcome, because state governments welcome this money when they bring it in, and then when people complain, they get less attention for what they’re doing. Taxing would be one way, just taking their money, just taking their money and having the government decide to do with it. How do you get rid of this idea that these people are better and smarter? Because I think that’s one of the ways, “We’ll fix it for you. We know more about this and that.”
And what’s interesting to me among all these people is, Jeff Bezos doesn’t do a lot of philanthropy. In fact, he just started, which I thought was fascinating. He resisted for a very long time and then, I think, felt pressure, must have felt pressure in some way to do that.
And again, what was so striking about his announcement was that I think our ...
His was to do what ...
$2 billion to start.
A billion to a Montessori program where kids would be treated like customers at Amazon. That’s his quote, not mine. I guess you can return your education within 14 days, or whatever.
And it’s free.
And then, so that was creating his own thing. And then the other billion was homeless programs. That was supporting existing programs, I think, in and around Seattle. What was interesting about it is I think our societal view of this stuff is maturing, so whereas when Gates made his announcement, people were just gaga, like, “That’s so nice, so nice.” And even Zuck several years ago now, it was still fairly uncritical, by my standards.
When the Bezos thing happened in September, I think it was, the day-one story, to use his favorite expression, the day-one story in the news media was, “Yeah, but ... you pay your taxes? Yeah, but don’t you have workers peeing in bottles? Don’t you have all these work campers,” that Jessica Bruder wrote about in Nomadland, such an important book, about these essentially homeless people living in caravans traveling around the country, working seasonal, a couple months here, couple months there, at Amazon? Why are you fighting homelessness by philanthropic moonlight while you’re causing homelessness by operational daylight? Why don’t you just not cause homelessness?
Right? Like, I don’t know. I’m sure these people in the Valley teaching girls to code, 1,000 girls to code ... you know what I mean? Why don’t you just not run your companies in a way that increases the likelihood of 160 million women in this country living under a misogynist? I think every woman I know would be willing to forgo a coding class for free but not live under a misogynist.
Right? It’s so much better that these people just don’t cause these problems.
That they then clean up 1 percent of with this like little wet wipe of philanthropy.
Okay. Let’s move to San Francisco and Marc Benioff and the tax. He was for a thing that would just tax people more, that’s all, and then the government. And the government didn’t want the money. I just interviewed the mayor there.
That was such a fascinating situation.
Right. In this case, San Francisco, Marc Benioff, was for a tax. He wanted to be taxed more, and other internet billionaires did not want to be taxed more, and they were fighting with each other. And then, the mayor sided with the ones who didn’t want to be taxed more.
Because she felt it would be too much money, suddenly, for the city to administer well.
Because they didn’t have a plan.
What was so interesting about this was, and I’ve had interesting conversations with Marc about this, because he’s done a lot of the philanthropy and stuff, CSR stuff, and this was, I think, one of the first things where instead of doing that with him giving the money and doing it, he advocated, he used his money to advocate for public policy to raise taxes on people like him. Right?
And I’ve talked to him since, and he’s sort of amazed at the amount of money it generates every month. Because you know what? The government is really big. Even the government of San Francisco, it’s just really big. And these things operate on a scale that even these rich guys actually can’t imagine. And what’s nice about that kind of tax is, as in my British experience, it has an expressive value. It’s not just about the money, right?
This is a lost vocabulary, but it matters when a society does something versus a person doing it. It matters when San Francisco has a plan to deal with homelessness versus a billionaire has a plan. We’ve lost the idea that that matters, but that’s kind of the whole reason we built a democracy, right? The Chinese make very good public policy on a bunch of things. I would argue on certain areas, their quality of policy making, given the interests of their people, is higher than ours.
But neither I nor anybody in this country wants to switch to their system, because the procedure matters. The fact that we’re consulted the way we are in this country matters. And I think we’re all willing to have a slightly worse outcome, or a much worse outcome.
If we all do it.
To have just procedures.
All right. Let’s finish talking about the 2020 election. So, a lot of these Democrats, especially, have been very close to the tech companies, and Cory was very close to Mark on Newark, and other things. What do you imagine will happen? Does government have the will to sort of stop taking advice from these people?
Do you remember? It’s not just Cory Booker. Do you remember, Obama sat and did a town hall with Mark Zuckerberg?
Yes I do.
The way you and I are sitting and doing this now?
You can’t imagine him doing that with some chemical CEO.
Right? Like, so many people participated in turning these people into sages, and need to stop doing that, including the media. Now, I think that 2020 thing, I am actually, the numbers are getting a little ridiculous, and I’m sure half this room is now going to announce it’s running for the Democratic nomination.
We’re at 23.
It’s become the clown car, I think it’s like 25 now after today.
Two more today, yeah.
I don’t know. It’s a lot.
But I actually think this is going to be a phenomenal primary. And I’m not so alarmed by the numbers. The reason I think it’s phenomenal is, we are going to have a real all-out philosophical argument about so many things in this country, because you have represented among this group very pro-tech, and people who want to break up the tech companies, people who are very close to billionaires, and people who want there to be maybe no billionaires anymore, or much fewer, many fewer.
You have dyed-in-the-wool capitalists, and then you have a democratic socialist, and then you have an Elizabeth Warren, someone whose policies are very close to democratic socialist but says she’s a capitalist in her bones. So, we are having already — and it’s going to get better — a real conversation of a kind that I don’t think we’ve had, where a lot of the fundamental values of this country are tested on these questions of power and justice and capitalism, whether you can have a real democracy when wealth is as concentrated as it is. I think this is going to be the primary about everything.
So, when you think about wealth is concentrated as it is, because it really is, and it is concentrated among, when you look at the list of Top 10 richest people, they are mostly tech people.
Actually. How do you change that? How can it be changed without them just giving away the money, or continuing, family after family, generation after generation?
Wealth tax. Capital gains tax. Crack down heavily on evasion and avoidance. Right? People like to treat it like some huge mystery. “It’s so complicated.” One of the people I interviewed for the book, who’s so brilliant, is this political philosopher named Chiara Cordelli at the University of Chicago, and she’s a political philosopher who studies wealth and philanthropy. She’s writing a book called The Privatized State, which sort of gets at what you were talking about earlier.
And she said something that is so profoundly true. She said, “These people,” by which she meant sort of the tech barons, but just the plutocratic class more generally. She said, “These people have a concept of agency that makes no sense. When they want to work government power to get Glass-Steagall repealed, when they want to work government power to shoot down Obamacare, when they want to work government power to make sure Medicare-for-All doesn’t happen, when they want to work government power to make sure a minimum wage increase doesn’t happen, they’re very capable of navigating the system.”
”They’re very deft.”
Yes they are.
”Suddenly, you say, ‘How do we fight inequality instead of increase it? How do we raise the minimum wage? How do we create a wealth tax?’ Suddenly, it’s like, you know, ‘The system is just so hard to understand. Who even understands the system?’”
“‘I can just do my thing over here — I don’t understand. I’m just a small guy, who’s very rich, and I can just do what I can do through my foundation.’”
“‘I can control ... I’m so little, I just don’t understand that.’”
They do that when you ask them about how to fix the things they’ve done.
First, they spend most of the time explaining how smart they are, and then when you actually ask them to fix something, they’re like, “It’s very hard, Kara.”
It’s very hard.
It’s very hard.
But somehow, when Google ...
And then I say, “I thought you were smart.”
Is spending $20 million a year lobbying in Washington.
Right. Exactly. So, what would the perfect rich person look like, who gives money away? Because there’s always going to be charity, and charity’s been an important part.
Do you mind them making hospitals, or things like that? Is that a bad thing?
It’s okay, but here’s what I say. I think in this moment ...
I get it you don’t like Pepsi making a jungle gym, I got that part, but ...
No, I get it.
What would be the good use of people who make enormous amounts of wealth?
That’s a great question.
What would be the way we let them give their money to us, besides taxes?
Look, to be clear, I think I want to live in America which has fewer billionaires with fewer to give away. But we’re not there yet. We may not get there. We got to work ...
You’re going to get a trillionaire.
We do need to work in the premise you just laid out, for now. I think when you live in an age of extreme inequality, like this one of hoarding, elite hoarding, elite monopolizing of the future itself … if you are a serious person who wants to give in better ways, the only acceptable kind of giving is traitor-to-your-class giving, right?
FDR was a traitor to his class. FDR ran this government as a traitor to his class. Good for people, bad for his fellow rich people. I think the kind of philanthropy that feels right to me in this moment is FDR-style philanthropy, except philanthropy, not running a government. Which is philanthropy that would actually break down, dismantle, help accelerate the end of a bad system instead of shore up a bad system.
Goldman Sachs’ 10,000 Women Program, that’s just giving back. It’s not really giving anything up. It’s not dismantling a bad system, right? It’s actually trying to buy yourself a little bit of wiggle room to continue being Goldman Sachs. But Goldman Sachs saying, “We’re going to actually get out of the student loan activities that we’re doing, which are actually just hurting and dooming millions of people, or we’re going to stop lobbying against Glass-Steagall or we’re going to stop lobbying against this consumer financial protection because, actually, it would be good for people even though it’ll be bad for us.” That would actually be giving up ...
And you can have philanthropists ... I was in a room full of philanthropists this afternoon. I asked them, “How many of you in this room” — about this size, because they all worked for big foundations, giving away lots of money. I said, “How many of you, your random foundations, how many of your foundations work on impact investing?” Maybe half the room’s hands went up. Two-thirds of the room’s hands went up. Most foundations in that room are engaged in that.
I said, “Great. How many of your foundations are working on a wealth tax?” It’s like one lonely guy in the middle was like ... right? It’s very simple what I advocate. People in that room, more of them should be working on the wealth tax. More of them should be working on equalizing public school funding, winning a Supreme Court case, so that it’s no longer legal in this country to fund public schools according to how big mommy or daddy’s house is.
Those kinds of things that would actually help dismantle a bad system and would actually not crowd government out but crowd government in. Where you’d use your giving to test things privately and then try to mainstream it into policy. That heritage has been lost under this fantasy of billionaires ...
That they know best.
... who want to build these companies as little kings and then want to rule over public life as little kings. Who I think, if they don’t quite get on the right side of history, are going to meet the fate of some of the more despised kings in history.
All right. Very last thing. Impact investing. That guy.
Fantastic guy. How many of you know the name Bill McGlashan? How many know the name Lori Loughlin or Felicity Huffman? This is the problem with America. Two actresses taking the fall for a bunch of rotten men. Here’s what happened, right? We all know that we were all spoonfed this story of two actresses ruined America. Well, a lot of men have been doing this for a very long time with a lot less scrutiny, cheating on a much bigger scale than buying one college seat.
In this group of defendants, with the two actresses, was actually the most important person caught up in that thing, Bill McGlashan — we have an alert from Bill McGlashan right there — who was the head of something called the Rise Fund, right? TPG, biggest private equity fund in the world. If bad is good, it is the best.
They’re a normal ruthless private equity fund, but they created the side fund, the Rise Fund, by helping people. Fighting poverty, injustice. Bono was literally involved in this one, I’m not just saying that. They were like brothers, or co-founders of this Rise Fund. They both went to Davos in January. They’re sitting in the obligatory parkas, even though it was probably inside a studio, wearing the parkas, talking about fighting poverty through impact investing. What was only revealed a few months after Davos is that this guy who has been out there, out there. This is a $2 billion impact investing fund. A lot of impact investing has been like half a million dollars or like $5 million ...
This was a lot of dough.
This is $2 billion. This is real money claiming we can fight poverty through finance. It turns out the dean of impact investing, Bill McGlashan, it is now revealed by the feds, was — after trying to empower the poor through finance by day — was going home at night and making phone calls to make sure that a seat in college was reserved for his son through bribery so that none of the people that he was empowering through his impact investing fund, no matter how empowered they got, no matter if they went to some better for-profit school in some African village or whatever the hell he was doing, that none of those kids could, at the end of the day, compete with his kid for the seat that had been bought.
I think there’s something so profoundly metaphorical, because what it teaches us is, when you have someone like Bill McGlashan in a domain like impact investing, trying to make the world a better place in ways that pay them a high return on investment, it is a clue. When you put those with the most to lose from real change in charge of change, you can expect some distortions. They’re going to change change. I think what I’m calling for is for us to simply take the changing of the world back from those who, actually, don’t want change at all and have stolen the idea of it in order to de-fang it.
All right. On that note, questions from the audience. We have a runner, who’s here. Questions? Okay.
I’m happy to also offer artistic criticism of all the WeWork hippie art.
No you may not. They’re very nice to have us. You be nice.
It’s really radical in this conglomerate ...
You be nice. You be nice. I agree, but still.
Audience member: Kara, I think you’d make a great mayor of New York, if you think about it.
You got a crazy one. No, thanks.
Audience member: My question is about this sort of rise of the rest mentality. I don’t know. I feel like Steve Case ...
Steve Case and Mark Cuban.
Audience member: There’s this recent article about spreading coding academies in Appalachia and this sort of idea that the prosperity of tech can spread to the rest of the country. I just wanted to get your thoughts on that.
There’s differences, just to be clear. Steve is doing more investing in companies across the country, he’s not doing a lot with coding. He’s not that involved because — it’s very clear coding is going commodity. It’s not going to be the savior of anybody in Appalachia, it’s just not.
Anand Giridharadas: Coding is the new coal in Appalachia.
Yeah. Exactly. It’s not going to be, but the idea is to get ...
Audience member: But it’s the same premise, really.
His idea was that, right now, 80 percent of venture funding now goes to three states and most of it to California, and most of it to Silicon Valley. They want to spread around the investing. But what do you think of that, Anand?
Anand Giridharadas: I mean, I think those initiatives are great, at the margin. But the problem is ... My understanding of the problems in West Virginia, which is limited to what I read, I think the lack of venture funding is an incredibly small part of the problem. I have a feeling that if they pay the teachers what the teachers wanted to be paid in those strikes, and they had, actually, a decent education system, I think you might see some of that startup activity happening on its own.
A lot of this stuff ends up being like nicotine patches for massive, systemic failures of governance. I mean, you can try it, but I just think you’re going to get a lot more Newarks and a lot more Columbusing, and I don’t think it’s going to change anything.
Okay, next. Right here.
Audience member: Hi. I just want to ask you what you think about the Bedrock Foundation and what’s happening down in Detroit. I was just there and there’s a resurgence. There’s, I can’t remember the name, but the guy who owns the Cleveland Cavaliers.
Oh what’s his ...
Anand Giridharadas: Dan Gilbert.
Audience member: Yeah, Dan Gilbert. He’s investing, changing the city, but there’s still so much homeless and there’s still so much work to be done. There are a lot of factories out there. Shinola is out there doing watches and everything else, and they’re saying that it’s made in America, but it’s really not. I just kind of want to see what you think of the capitalist point of view with philanthropic ...
Anand Giridharadas: I mean, what’s so interesting, I just saw this the other day. There was this story that you all probably saw, that TurboTax has been lying to people who could file for free.
And they’d been gaming the search results so they don’t know that and have to pay TurboTax something. TurboTax is like a spinoff from the company that Dan Gilbert was involved in founding. This is sort of how it works. You have these entities that generate a lot of money and some of that money goes to trying to help Detroit. But frankly, I bet a lot of people in Detroit were also screwed by that practice and various other practices.
Detroit, from what I hear, is also sort of becoming like Dan Gilbert’s town, which to me feels like refeudalization. I just think we worked really, really hard to leave the Middle Ages, where you had towns where you had one lord and lady, and then everybody else was just their, like, Seamless drivers — back-projected 500 years.
We’re willingly re-entering that world in so many ways. There’s just so many ... I was just in Michigan a couple of weeks ago. So many structural issues, racial segregation, water in Flint ... Just structural issues in Michigan that some rich guy throwing coin is just not going to be part of solving. They had that CEO-governor, I don’t know if they still have that guy, Snyder. Private equity guy or something like that. The people who caused this problem should be nowhere near the wheel of solving it.
Okay. One more question so you can make time for ... Right here. Sorry, go ahead.
Audience member: Hi, I’m a big-time Kara Swisher fan.
Audience member: Much like ... Another thing, I think that Kara Swisher should run for, I don’t know, for president? But I think maybe enforcer for Elizabeth Warren, in case anyone comes after her.
She is a smart lady.
Audience member: Yeah. I think ...
Too smart for the men.
Audience member: Well sometimes, much like the throne, the person who should be in power isn’t the one who’s actually in power.
Audience member: The question, thank you, is, there’s been a lot of amendments made to the Constitution in the past to address gross social inequities or things that need to be addressed. What do you think would be like three main topics that could be in that amendment?
Anand Giridharadas: I mean, first of all, our country is so broken that we can’t pass spending resolutions, an amendment requiring three quarters of the states and two-thirds vote, I mean, it’s complicated. However, I actually think the issue of inequitable public school funding is, in some ways, the gravest unresolved constitutional violation of this country. Because it’s basically racial segregation ongoing through class, right? A de facto Jim Crow is still on the books because Greenwich can fund Greenwich’s schools and Bridgeport funds Bridgeport schools in Connecticut, and everywhere.
When I talk to people — not politicians, but regular people on the right in this country — they’re actually as offended by ... That’s not a particularly conservative value either. There’s a little bit of local control thing, but I think abolishing unequal public school funding would do more to advance justice in this country than maybe any other single thing.
Right now it is legal. I mean, you just have to get your head around the idea that there are districts in this country that spend $30,000 a year on public schools and there are other districts, sometimes next door, that spend $5,000 a year on school. This is essentially picking some kids to condemn because their parent’s house is smaller, and usually because they’re more likely to be poor and black and whatever else. To me this feels like something that’s as unconstitutional as various other things that we couldn’t achieve through a court ruling and had to do through that process. That’s what I would submit.
Last question, very quick because we’ve got to Gabe. Do you think the tide is turning on this?
I do. I want to give a real shoutout to someone who I think has been such an important catalyst for change and awakening in this country, which is Donald Trump.
Because for 30 or 40 years, this ideology that I’ve been talking about, we’ve been talking about, has been pretty indomitable, right? “Business people are smarter than everybody else. Success in some domain means you should have thoughts about all the domains. People who cause problems are the most qualified to fix them.” This has been in the water for a long time. It’s the tech rhetoric, it’s the banker’s rhetoric.
But no one has so quickly, efficiently, and flamboyantly discredited the entire tao of philanthrocapitalism the way Donald Trump has in just two years. It is now inarguable that being a business person is no guarantee of intelligence. It is now inarguable that knowing one industry does not make you an expert, even necessarily on that industry and certainly anything else. It is now inarguable that, in fact, being the guy who made ties in Mexico and China does not make you supremely qualified to bring jobs back from Mexico and China. That arsonists are not, in fact, the best firefighters.
My hope, and I think we saw a lot of this in 2018 with all the improbable victories, all the people running for office. All the women who ran, who didn’t even necessarily win but are going to be running next time and the next time, that people are actually waking up to the idea that we’re not going to change the world through an app, right? We’re not going to change the world through management consulting firms or CSR or tech companies or whatever. That you get the kind of society you are willing to invest in democratically, and democracy is not a supermarket, right? “I need milk, I’m going to pop in and grab a little milk.” It’s a farm, right? You don’t grow anything, you don’t plant anything, you don’t get anything. I think that has been awakened, and I see a revival of civic life.
I see people knowing the names of various bills, HR 64 ... There is an awakening happening that I don’t think I’ve seen in my lifetime, and I think, a taking back of just the very idea of self-government. People with Donald Trump’s level of IQ often have unintended legacies that exceed their intended legacies, is the nice way to put it. I think his intended legacies are disastrous, don’t get me wrong, but I think his unintended legacy may be greater in the long run, if we survive the intended legacies. That we woke up to the idea that we weren’t going to be saved by money, and that we are going to save ourselves.
He’s so poor, all he has is money. All right. Thank you so much.
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