Silicon Valley’s inevitable swing to MAGA land

Poke the bear one time too many, and…

Ben Horowitz and Marc Andreessen run the world’s most successful venture capital firm. Perhaps not the largest, but by most measures it is the most successful, most prescient, most far-sighted and the most visionary VC outfit. Both men started out as young idealists, dreamers and of course, liberal minded, Democrat-leaning engineers. Marc swung to the right several years ago, reporting a feeling of exasperation with left wing pettiness and the failure by the democrats to see the future and help build solutions that make our future brighter. He started donating to Republican candidates, without embracing the whole red party agenda — the pro life, second amendment, christianity-first, anti-immigrant package.

Now both Marc and Ben have gone public with their unapologetic support for the MAGA agenda.

Expect many prominent Silicon Valley names to follow suit in the coming weeks and months. The inevitability of this moment should have been visible from space. We bay area locals must wear the blame, while the rest of it goes to New York and its news media for incessantly attacking tech funders, VC and engineers and demonizing them as misogynists, corrupt, greedy and narcissistic. Bay Area residents seem to have formed their we-hate-tech club a couple of decades ago, and have recruited supporters ever since. The movement combines hatred of the rich, a deep rooted suspicion of engineer geeks as sexist and at times misogynist, and a profound mistrust of technology itself, pitting the anti-tech movement against innovators and new ideas. San Francisco’s crime numbers were in the early stages of their current increase when the city decided to ban facial recognition — in all its forms — from use by local government and law enforcement, including by private firms assisting law enforcement. Uber, AirBnb, food delivery apps, cash apps and other game changers born in San Francisco were attacked as job killers, traffic congestion causers, gig economy players conspiring to spread mass poverty, and generally despised by all. Autonomous vehicles came under massive attack, leading to Cruise vehicles being banned. Scooter companies featured in the news only when a story could paint them as cheap trash cluttering our sidewalks.

Meanwhile, the hate-the-rich brigades continued their media tirade to influence kids and students against idolatry of innovators, founders and venture capitalists. It fits neatly into the broader thetoric that capitalism itself is poised to collapse and be replaced with some yet to be identified, new school of thought.

We forget that the tech sector is singlehandedly responsible for the stock markets’ extraordinary perfrmance over the past 10 years. It has carried America over humps and scares in real estate, healthcare, banking, the everything-scare of Covid-19, and the overvaluation theory that has echoed since 2017. Break America’s technology backbone, and you break America. And the tech sector will reappear in China within months. That’s when we’ll know we’ve lost and can’t recover. That’s when China’s copycat companies and technologies will wield even greater power than their American predecessors, but with no government control or oversight, and the ensuing wealth creation happening 100% in China, not America. That’s when the see-saw tips, and isn’t coming back. The most far-left progressives will enjoy this day. Most of us will not.

America has solved the hardest economic problem: how to create a healthy, thriving, wealthy economic environment, providing large scale prosperity to millions of people. Now America must try to solve the easier, less mysterious problem: how to reduce the wealth gap without destroying wealth. Many of the more extreme progressives don’t care about that last part.

The tech industry is thriving because of SF Bay Area’s unique blend of cultural and economic forces. Risk-friendly capital is rare in Europe, and even in US east coast. 9/10 bets go to zero, and 1/10 goes to the moon. Most banker types can’t get their heads into that mode, nor should they. Founders are expected to be on the spectrum, difficult to get along with, at times incommunicative, sometimes tantrum-prone, and mercurial. Early employees are expected to be super flexible, devoted, loyal, and have no life outside of work. Stock options promising a chance to break into actual wealth, are a good glue for this loyalty. Together, we’re generally rebels, expecting to disrupt the status quo, upset bankers and dusty old law firms, and we expect to contribute to changing the world, each in our own small way. By nature, we are liberals. Liberal capitalists who dream of a fairer, better, more transparent world. We support all the liberal causes, from reproductive rights to immigrant rights to racial justice to freedom of information and equal opportunity for all. Our DNA screams Democratic Party.

So why are so many of our prominent figured turning away this year?

Progressive fiscal policy has moved too far for the wealthiest 1% — or .1% — to continue supporting. They’re afraid — with good reason — of a revamped tax policy that would evaporate their accumulated net worth, not just their annual incomes. Recent changes in California’s and Delaware’s policymaking and new bills passed, have attacked the accounting practices of startups. One of them demands amortization of R&D expenses over 5 years instead of 1 year, leaving the remaining 80% of that year’s R&D costs as non-deductible expenses, therefore leaving revenues as taxable, even when the company made a net loss in that year.

The collective attacks by the angry left have created a backlash, turning benevolent democratic voting wealthy people into reluctant MAGA supporters. Oops.

Put this together with the other demographics recently alienated by the progressives and the woke movement. The black vote has dwindled, leaving only the inner city workers and the unemployed. Black families with good income — especially churchgoing families — have left. The union vote has all but left the building. The UAW did not support Biden. Yikes. The Latino vote was always shaky, given its strong Catholic and anti-LGBT roots, but since 2018 we have alienated millions of Latino business owners and are left with only a thin slice of the pie versus the total Latino population. Women voting for Biden should be 75% of all women, right? Oops, no actually that number too, has fallen dramatically.

Let’s not write the moral of the story. Let’s let the reader decide what to make of this and what the remedy might be.