“A fool and his money are soon parted,” wrote poet Thomas Tusser a few hundred years ago. Silicon Valley moguls are anything but foolish, so they ate a huge portion of humble pie in beating a path to Trump Tower this week. Their aim is not to keep the wealth they’ve built for themselves, but to continue to grow it. It is the hope here that more than profit talk was on the table – like maybe freedom from oppressive government overreach. Many fear a Trump crackdown on personal privacy, due to his calls for stronger encryption.
In case you’ve forgotten, Silicon Valley didn’t just support his opponent, Hillary Clinton, in word and deed. No. The moguls went further – mercilessly, viciously, and relentlessly savaging Candidate Trump during the election campaign. Is he one to forgive and forget? If the past is any indication, the tech industry is wise to be wary, and savvy to be servile.
Perhaps its bosses also recall that President Obama, back in 2009, in chiding the opposition Republicans while simultaneously choosing not to compromise with them, famously uttered that, “Elections have consequences;. I won.” With that phrase, he rammed Obamacare through Congress along party lines. And it has dogged him since, and crippled his Democratic Party. Could Donald Trump be as arrogant and vengeful as Obama, and punish the tech execs for their actions during the campaign?
It is with good reason that the Silicon Valley sultans despaired at the prospect of a Trump presidency and possible payback personally, professionally, and girded for a potential anti-privacy posture by his administration. Also, upon reflection, and with their bottom lines clearly in focus, these executives and entrepreneurs are hopeful that campaigning and governing are usually two distinct propositions. The phrase, campaign in poetry and governing in prose, comes to my mind, and may be appropriate here.
There is symmetry, too, I suppose, that exists among billionaires, of which Trump is one. While some billionaires may act stupidly at times, they didn’t get to be billionaires by being stupid all the time, or they and their businesses would not have succeeded! A constant among the brotherhood of billionaires is making sound business decisions.
Thus, mending fences with the man in control of billions of dollars in discretionary spending makes as much business sense as do policy prerogatives. That, of course, and the fear-factor inherent for one who likes to express himself with tweets. No, make that a tweeter on steroids, with nearly 20 million followers. What effect does the power of a tweet have, you ask?
Consider the price of Apple stock, to give one just example. Trump winning would be considered bad for tech stocks in general, and Apple in particular, it was assumed. On the stump, Trump delivered strong anti-Apple rhetoric against the firm during the locked San Bernardino iPhone row.
And then there was Trump’s anti-trade tirade. What if Apple could no longer manufacture cheaply in China? Well, on news of his election victory, Apple’s stock price tumbled five percent – about $25 billion in market capital gone in a flash. Moves like that tend to get executive’s attention, as well as that of investors. It also prompts people to act.
However, after digesting the reality that Trump was assembling an “A Team” of business-minds into his cabinet (voices of moderation?), and after the recent Trump Tower summit, Apple stock not only regained the lost market share, but achieved a new high, as investors breathed a sigh of relief.
A better example of just how the mere mention of a company’s actions can hurt them financially can be found in a tweet, of all things, about Lockheed Martin, a defense manufacturer. The supposedly off-the-cuff tweet said,
“The F-35 (a warplane in development) program and the cost is out of control. Billions of dollars can and will be saved on military (and other) purchases after January 20th.”
This tweet instantly wiped $4bn off the value of Lockheed Martin, the lead manufacturer of the warplane. If Trump can do that to an aerospace manufacturer with a tweet in a matter of seconds, what could he do to the tech companies over four years… or eight?
So the tech titans have began looking at things through Trump’s lens. If he’s going to do the type of building and improving on which he campaigned, he’s going to need a bevy of business leaders to help him accomplish his goals. After all, the bloated bureaucracy of government , which he promised to reduce, will not offer the innovation. Nor does it have the incentive, or possess the inclination to do so.
It’s also no wonder why on the day after the election, the IBM CEO wrote a letter of congratulation, and offered to collaborate on things like “data analytics, data centre consolidation and the use of cloud technologies” to cut government costs and spur economic growth.
There are other purely economic reasons the tech companies have for wanting to curry favor with the new president. In total, US companies hold about $2.4 trillion offshore. The tech companies’ share of that is a quarter – $560 billion. Trump has proposed an amnesty to repatriate the money in a one-time deal- a bargain . Just maybe the new president won’t be so dangerous to them, after all. Anyway, they’re playing the percentages.
When I began research for this article, I hoped to find some inkling or a tell-tale sign that the techies might be going to Trump Tower to advocate for personal privacy protections – stronger encryption, no backdoors, and the like. I guess it will have to wait for another day, another article, because their apparent grovelling speaks of just a money-grab.
As a user of the essentially free technology that has emanated from Silicon Valley, I don’t begrudge their focus on the bottom-line or on protecting and growing profits. Most are public companies beholden to their shareholders, many of whom. through their pensions, are ordinary taxpaying citizens.
Maybe the quid pro quo for the techies’ obeisance to Trump will also ultimately be beneficial privacy-wise for the average citizen. If not, we may need more than a VPN to secure our privacy in the future.