Not Everyone Hates The Republicans-- The Big Silicon Valley Firms Are Selling Out

You probably saw the new Gallup poll from yesterday showing how badly Trumpanzee is tanking with Americans watching his daily antics during the transition. Independents are sickened by him already and the majority of Americans disapprove of his transition efforts.

Trump's 48% transition approval rating in December was already the lowest for any presidential transition Gallup has measured, starting with Bill Clinton's in 1992-1993. Trump's current rating only further separates him from his predecessors -- particularly Barack Obama, who earned 83% approval for his handling of the transition process in January 2009, up from 75% in mid-December 2008... Americans view Trump's Cabinet as worse than the Cabinets chosen by Obama, Bush and Clinton... The chief differentiator for Trump is that many more Americans rate his appointments as "below average" or "poor": 44% say this about Trump's Cabinet choices, compared with 13% for Bush's, 12% for Clinton's and 10% for Obama's.

But this week Thomas Edsall reported in the NY Times that not everybody is moving in the same direction politically. Silicon Valley seems to have taken a right turn. The political money flow has reversed course-- from Democrats to Republicans over the past cycle. The Microsoft, Facebook, Google and Amazon PACs all contributed money money to Republicans than to Democrats. Employees of these companies are still supporting Democrats over Republicans, but the companies themselves are tilting heavily towards the GOP.

As these technology firms have become corporate behemoths, their concerns over government regulatory policy have intensified-- on issues including privacy, taxation, automation and antitrust. These are questions on which they appear to view Republicans as stronger allies than Democrats.

In 2016, the PACs of these four firms gave a total of $3.6 million to House and Senate candidates. Of that, $2.1 million went to Republicans, and $1.5 million went to Democrats. These PACs did not contribute to presidential candidates.

The PACs stand apart from donations by employees in the technology and internet sectors. According to OpenSecrets, these employees gave $42.4 million to Democrats and $24.2 million to Republicans.

In the presidential race, tech employees (as opposed to corporate PACs) overwhelmingly favored Hillary Clinton over Donald Trump. Workers for internet firms, for example, gave her $6.3 million, and gave $59,622 to Trump. Employees of electronic manufacturing firms donated $12.6 million to Clinton and $534,228 to Trump.

Most tech executives and employees remain supportive of Democrats, especially on social and cultural issues. The Republican tilt of the PACs at Microsoft, Amazon, Google and Facebook suggests, however, that as these companies’ domains grow larger, their bottom-line interests are becoming increasingly aligned with the policies of the Republican Party.

In terms of political contributions, Microsoft has led the rightward charge. In 2008, the Microsoft PAC decisively favored Democrats, 60-40, according to data compiled by the indispensable Center for Responsive Politics. By 2012, Republican candidates and committees had taken the lead, 54-46; and by 2016, the Microsoft PAC had become decisively Republican, 65-35.

In 2016, the Microsoft PAC gave $478,818 to Republican House candidates and $272,000 to Democratic House candidates. It gave $164,000 to Republican Senate candidates, and $75,000 to Democratic Senate candidates.

Microsoft employees’ contributions followed a comparable pattern. In 2008 and 2012, Microsoft workers were solidly pro-Democratic, with 71 percent and 65 percent of their contributions going to party members. By 2016, the company’s work force had shifted gears. Democrats got 47 percent of their donations.

This was not small change. In 2016 Microsoft employees gave a total of $6.47 million.

A similar pattern is visible at Facebook.

The firm first became a noticeable player in the world of campaign finance in 2012 when employees and the company PAC together made contributions of $910,000. That year, Facebook employees backed Democrats over Republicans 64-35, while the company’s PAC tilted Republican, 53-46.

By 2016, when total Facebook contributions reached $3.8 million, the Democratic advantage in employee donations shrank to 51-47, while the PAC continued to favor Republicans, 56-44.

While the employees of the three other most valuable tech companies, Alphabet (Google), Amazon and Apple, remained Democratic in their giving in 2016, at the corporate level of Alphabet and Amazon-- that is, at the level of their PACs-- they have not.

Google’s PAC gave 56 percent of its 2016 contributions to Republicans and 44 percent to Democrats. The Amazon PAC followed a similar path, favoring Republicans over Democrats 52-48. (Apple does not have a PAC.)

Tech giants can no longer be described as insurgents challenging corporate America.

“By just about every measure worth collecting,” Farhad Manjoo of The Times wrote in January 2016:

American consumer technology companies are getting larger, more entrenched in their own sectors, more powerful in new sectors and better insulated against surprising competition from upstarts.

These firms are now among the biggest of big business. In a 2016 USA Today ranking of the most valuable companies worldwide, the top four were Alphabet, $554.8 billion; Apple, $529.3 billion; Microsoft, $425.4 billion; and Facebook, $333.6 billion. Those firms decisively beat out Berkshire Hathaway, Exxon Mobil, Johnson & Johnson and General Electric.

In addition to tech companies’ concern about government policy on taxation, regulation and antitrust, there are other sources of conflict between tech firms and the Democratic Party. Gregory Ferenstein, a blogger who covers the tech industry, conducted a survey of 116 tech company founders for Fast Company in 2015. Using data from a poll conducted by the firm SurveyMonkey, Ferenstein compared the views of tech founders with those of Democrats, in some cases, and the views of the general public, in others.

Among Ferenstein’s findings: a minority, 29 percent, of tech company founders described labor unions as “good,” compared to 73 percent of Democrats. Asked “is meritocracy naturally unequal?” tech founders overwhelmingly agreed.

Ferenstein went on:

One hundred percent of the smaller sample of founders to whom I presented this question said they believe that a truly meritocratic economy would be “mostly” or “somewhat” unequal. This is a key distinction: Opportunity is about maximizing people’s potential, which founders tend to believe is highly unequal. Founders may value citizen contributions to society, but they don’t think all citizens have the potential to contribute equally. When asked what percent of national income the top 10% would hold in such a scenario, a majority (67%) of founders believed that the richest individuals would control 50% or more of total income, while only 31% of the public believes such an outcome would occur in a meritocratic society.

One of the most interesting questions posed by Ferenstein speaks to middle and working class anxieties over global competition:

In international trade policy, some people believe the U.S. government should create laws that favor American business with policies that protect it from global competition, such as fees on imported goods or making it costly to hire cheaper labor in other countries (“outsourcing”). Others believe it would be better if there were less regulations and businesses were free to trade and compete without each country favoring their own industries. Which of these statements come closest to your belief?

There was a large difference between tech company officials, 73 percent of whom chose free trade and less regulation, while only 20 percent of Democrats supported those choices.

Ferenstein also found that tech founders are substantially more liberal on immigration policy than Democrats generally. 64 percent would increase total immigration levels, compared to 39 percent of Democrats. Tech executives are strong supporters of increasing the number of highly trained immigrants through the HB1 visa program.

Joel Kotkin, a fellow in urban studies at Chapman University who writes about demographic, social and economic trends, sees these differences as the source of deep conflict within the Democratic Party.

In a provocative August, 2015, column in the Orange County Register, Kotkin wrote:

The disruptive force is largely Silicon Valley, a natural oligarchy that now funds a party teetering toward populism and even socialism. The fundamental contradictions, as Karl Marx would have noted, lie in the collision of interests between a group that has come to epitomize self-consciously progressive mega-wealth and a mass base which is increasingly concerned about downward mobility.

The tech elite, Kotkin writes, “far from deserting the Democratic Party, more likely will aim take to take it over.” Until very recently, the

conflict between populists and tech oligarchs has been muted, in large part due to common views on social issues like gay marriage and, to some extent, environmental protection. But as the social issues fade, having been “won” by progressives, the focus necessarily moves to economics, where the gap between these two factions is greatest.

Kotkin sees future partisan machination in cynical terms:

One can expect the oligarchs to seek out a modus vivendi with the populists. They could exchange a regime of higher taxes and regulation for ever-expanding crony capitalist opportunities and political protection. As the hegemons of today, Facebook and Google, not to mention Apple and Amazon, have an intense interest in protecting themselves, for example, from antitrust legislation. History is pretty clear: Heroic entrepreneurs of one decade often turn into the insider capitalists of the next.

In 2016, Donald Trump has produced an upheaval within the Republican Party that shifted attention away from the less explosive turmoil in Democratic ranks.

Hillary Clinton’s failed bid to finesse the inherent conflict between her dependence on corporate contributions and her need for a strong turnout by union workers, minorities and idealistic millennials embodies the Democratic Party’s long term struggle.

High tech and virtually every other special interest poured money into her campaign: finance, insurance and real estate, $115.4 million; communications/electronics, $59.6 million; lawyers and lobbyists, $41.5 million; organized labor, $35.2 million-- the list goes on and on.

The public, at least for the moment, is not willing to support the continued compromise of principle that has been a hallmark of both parties. Trump has provided a temporary solution for the Republican Party; the Democrats need to find a legitimate and more lasting one.