New Populism and Silicon Valley on a Collision Course
New Populism and Silicon Valley on a Collision Course
Trump’s focus on jobs, globalization and immigration
tapped anxiety about technological change
By CHRISTOPHER MIMS Updated Nov. 10, 2016 7:39 p.m. ET
Tuesday’s election was an expression of voter angst that
heralded a new type of populism. For Silicon Valley, it also marked the
ascension of a vision starkly at odds with its own.
The world is changing faster than ever, and Donald
Trump’s campaign tapped into concern about where that change is taking the
country. Many of the campaign’s central issues—jobs, globalization and
immigration—had in common that they were rooted, in large part, in
technological change.
The populist wave Mr. Trump rode appears to be on a
collision course with the fruits of technology and the people who build it.
Uber Technologies Inc. and others are testing
self-driving trucks. That augurs trouble for the 3.5 million truck drivers in
the U.S., who hold some of the best-paying jobs that don’t require a college
degree. Meanwhile, advances in artificial intelligence are beginning to consume
white-collar jobs in fields such as medicine and finance, shifting the debate
over the impact of technology.
Navdy, a head-up display for cars, projects messages,
maps and apps from a smartphone into the driver’s line of sight. Does it cure
distracted driving—or make it worse?
The tech industry champions immigration. Many of its
executives are foreign born. It embraces trade. Overseas markets accounted for
58% of its revenue last year, the second-highest share for any U.S. industry
after energy, according to CFRA Research. And overseas workers build most of
the electronic gadgets that U.S. tech companies sell.
The setting for Mr. Trump’s critiques of American
capitalism was often a closed or soon-to-be-closed factory.
But, thanks to advances in automation, there’s little evidence
that bringing factories back to the U.S. would lead to significantly more jobs.
The dollar value of what Americans make goes up every year, but the share of
Americans who make those goods continues to decline. It was 8.7% of working
Americans last year, down from a postwar high of nearly one in three in the
1950s.
The overseas factories to which many U.S. companies
shifted production are themselves rapidly automating. There simply aren’t
enough pockets of ultracheap labor left.
“The era of using offshore low-cost labor will come to an
end because the standard of living is rising around the world,” says Jon Sobel,
chief executive and co-founder of Sight Machine Inc., which helps companies
manage the data pouring off their automated assembly lines. He can’t name his
clients, but they range from a Big Three auto maker to a famous apparel
company, all of which seek his company’s help in automating factories overseas.
The end results of this trend, in America and elsewhere,
are what are known as ”lights out” factories, where processes are so automated
that there’s no need to illuminate the production line except when it breaks
down.
To many in Silicon Valley, this is just part of
inexorable progress. Electing Mr. Trump won’t shield his supporters from the
reality that they are now competing with every other worker on Earth, says
Balaji Srinivasan, a board partner at venture-capital firm Andreessen Horowitz
and CEO of bitcoin startup 21 Inc.
Mr. Srinivasan views the collision between tech culture
and Mr. Trump’s populist movement as inevitable, and potentially so divisive
that tech’s global elites should effectively secede from their respective
countries, an idea he calls “the ultimate exit.”
Already, he says, elites in Silicon Valley are more
connected to one another and to their counterparts around the globe than to
non-techies in their midst or nearby. “My Stanford network connects to Harvard
and Beijing more than [California’s] Central Valley,” says Mr. Srinivasan.
Eventually, he argues, “there will be a recognition that if we don’t have
control of the nation state, we should reduce the nation state’s power over
us.”
Such concepts are far-fetched, but the underlying
cultural and ideological divisions are real.
“It’s crazy to me that people in Silicon Valley have no
idea how half the country lives and is voting,” said Ben Ling, an investment
partner at venture firm Khosla Ventures. Many “coastal elites” attribute the
results “to just sexism or racism, without even trying to figure out why
[people] wanted to vote for Trump.”
Ultimately, the clashes may not prove so dramatic.
Technology may fall short of visionaries’ lofty promises. And Mr. Trump may
pursue policies that are more symbolic than detrimental to the tech industry,
says Anshu Sharma, a venture capitalist at Storm Ventures and founder of
artificial-intelligence startup Learning Motors.
“We’ll eventually find out whether he decides he does
want to bring back an Apple factory from China,” says Mr. Sharma. “I think he’s
going to pick on one or two companies and make an example, to show his base
that he’s fixing America.”
Robert Atkinson, president of the Information Technology
and Innovation Foundation, an industry group, says, “There was a bromance
between Obama and the tech industry. That is not going to be the case with a
Trump presidency.”
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