It was a fascinating discussion, if incomplete, watching two older tech billionaires try to explain to the public why they are making large donations to influence an election. I’ve followed Marc Andreessen’s career since the 1990s, when he was one of the early engineers working on browsers, for a company called Netscape, and he has been a wealthy venture capitalist and futurist pundit since then. He has strong anti-monopoly bona fides, since Netscape was crushed by Microsoft, and his work became an important part of the government’s antitrust case against the software giant.

His colleague, though a less well-known billionaire, is equally interesting. Ben Horowitz worked with Andreessen, and both went on to found a company, Opsware, that was a nascent creator of the principle behind cloud computing. He comes from neoconservative royalty, with his father, David Horowitz, a Communist Black Panther-sympathizer in the 1960s turned hardcore Reagan revolutionary.

The two formed Andreessen Horowitz (a16z), a path-breaking venture capital firm that put money into Facebook, Twitter, AirBNB, Stripe, and Lyft, among others. It had its heyday in the mid-2010s, during the era of the ‘sharing economy.’ Andreessen is, more than anything, a genius at framing. In 2011, he wrote an essay, “Why Software is Eating the World,” in which he argued that America was “in the middle of a dramatic and broad technological and economic shift in which software companies are poised to take over large swathes of the economy.” That paved the way for the firm’s investments. In 2020, another essay, “It’s Time to Build,” characterized the inability of the West’s to make things during the Covid pandemic.

Andreessen and Horowitz are New Democrats, which is to say they really liked Bill Clinton and Barack Obama. “The Obama years proved you could have a pro-business Democratic administration,” said Horowitz, noting the “great tech boom of Obama” and praising the dot com era under Clinton.

Despite Andreessen being a board member of Facebook, the framing these two offer is that they are on the side of ‘Little Tech.’ And they both make anti-monopoly arguments, noting that companies like Apple, Google, and defense contractors thwart new entrants, and are lazy as a result. So one might think, especially with Andreessen’s experience with antitrust, they see some value in anti-monopoly policy. But they don’t even mention it, except furtively, as a threat to their way of life, and thus, America’s way of life. And that’s where the argument gets interesting.

Andreessen and Horowitz have a view of America in which our might, and thus the world’s peace and prosperity, rests on three pillars: a strong economy, world-leading technology, and a powerful military. American culture is, as they put it, “depraved” and full of drug addiction, but our strength is that talented people can build things. We are not, as they put it, Argentina, or the Soviet Union. In World War II, America won because we invented better technology – not the government – but the private sector, the ‘Little tech’ guys like Henry Ford and Thomas Edison, whose legacy Andreessen and Horowitz see themselves as upholding. The USSR gave up the fight because they just couldn’t keep up with our technology, and the war in Ukraine is showing how important AI is for warfare.

Biden is threatening this very foundation in two ways. First, he is attacking the basis of technological innovation. Andreessen and Horowitz criticized the Biden administration’s industrial policy for trying to pick which innovations will be important and which won’t, which is wildly inappropriate. No one has ever been able to do that, history is littered with examples of failed arguments about what will matter and what won’t. This need for control, they argue, leads to Biden trying to strangle the blockchain, or crypto, in its crib, with lawless attempts by the SEC to apply securities law to tokens.

Many of their companies, like WorldCoin, Ripple, and Coinbase have been sued, and the Securities and Exchange Commission keeps losing, but it’s painful and frustrating to deal with the full might of the administrative state. Similarly, fintech, which is to say companies that try to innovate to help the poor, like LendUp, keep getting sued by the Consumer Financial Protection Bureau. Though they don’t mention the Federal Trade commission, Horowitz expressed his anger that one of their portfolio companies, Maze Therapeutics, which has a nascent treatment for a condition called Pompe disease was sold to Sanofi, but then had the sale blocked by the FTC. He says that all venture investing in biotech is now dead as a result.

Finally, both were apoplectic about Biden’s proposal to tax unrealized gains, the so-called ‘billionaires tax,’ which they claim would destroy the venture capital industry and California itself. This proposal would destroy the economic basis of American strength. “Clinton’s view,” Horowitz said, “was that if you want expansive social programs, you want a tax base to pay for it. There’s a level of self-sabotage here.” So that’s their argument.

With that said, there’s a lot that goes unmentioned. For instance, at no point in their praise of the blockchain do they bring up that large swaths of crypto, if not the entire apparatus, turned out to be a giant scam. It wasn’t that they said ‘oh sure Sam Bankman-Fried was bad but there’s some value here,’ they literally just didn’t mention any of the vast apparatus of fraud and money laundering that everyone saw in 2022.

But that’s not all.

Horowitz was, to put it nicely, imprecise about the SEC’s track record; the SEC is slowly winning many of its claims about crypto – including a16z portfolio firm Coinbase – otherwise crypto vc’s wouldn’t need to lobby Congress to act. Additionally, fintech is a disaster, costing poor people large sums of money, and the a16z portfolio firm LendUp was caught multiple times violating the law. Moreover, the story of biotech is just not correct. The FTC stopped Sanofi from buying Maze Therapeutics not for no reason, but because Sanofi was engaged in an illegal scheme of trying to kill a rival treatment for Pompe disease so it could preserve its ability to charge $750,000 for an annual course. And Maze Therapeutics quickly found a different company to buy their treatment, for the exact same price.

But of course, such incomplete commentary is not unusual. That’s why Andreessen’s essay in 2020 about needing to physically build happened as his investments in crypto – the opposite of building – took off in value. Even their thesis – that no one can predict which technologies will be useful and which won’t – wasn’t consistent with their insistence that they know how important crypto and AI will be. (It’s also not true. For instance, everyone understood immediately that the transistor, invented in 1947, would be a world-changing device, and why the U.S. military and antitrust enforcers insisted that AT&T share its patents and knowhow. How tech will matter is never clear, but it’s often obvious which tech will matter, which is why the U.S. government has been foundational in pretty much all important modern tech endeavors)

Andreessen and Horowitz are not partisan Republicans, at all, their goal is as much to change the Democratic Party as get Trump elected. They see Biden as an anomaly, with people in his administration, namely those under the influence of Elizabeth Warren, who “flat out hate tech and hate capitalism.” And like the New Democrats they are, they praise Democrats and administration officials, like Chuck Schumer, Richie Torres, Gina Raimondo, and Jake Sullivan. SEC Chair Gary Gensler, Warren, and Biden himself come in for scorn, in part because they refused to meet with the duo. .

In other words, these New Democrat billionaires view Trump, with whom they met, as a return to neoliberal normalcy, and closer in fact to Clinton and Obama than Biden. And this explanation is as close to a political argument for the financial backers of Vance, who, though he is very strongly supportive of crypto, is otherwise someone who deeply dislikes this kind of finance-heavy oligarchical thinking.

So there we go.

To have this particular funder group behind Vance is on one level very odd. His breadcrumb trail of policy choices and actions would seem to be inconsistent with their views. Vance wants to raise tariffs, tighten antitrust, slash immigration, cut environmental rules, and roll back the U.S. involvement in Ukraine, all of which he thinks will help the working class. He helped block the foreign acquisition of U.S. Steel. Rare for a Republican, he has gone after the credit card duopoly and the CEOs of failing banks, sought to reduce the taxable benefits of mergers, and proposed a new rail safety law. He has attacked the role of the dollar as the world’s reserve currency, and is a foe of big tech, not just in supporting legislation, but in litigation as well. For instance, he filed an amicus brief calling for Google to be regulated as a common carrier.

On the other hand, at Remedy Fest, Vance sang the song these guys love. “If there’s a candidate for worst person” in the Biden administration, he said, that would be Securities and Exchange Chair Gary Gensler. “The fundamental issue,” he said, “is the approach that Gary has taken to regulating blockchain.” While Vance said he worried about “financialization” and whether “whether a lot of the crypto stuff is fundamentally fake,” he also said these technologies were the only real way to challenge big tech, because regulation and antitrust just took too long and couldn’t really work. That’s exactly how Andreessen and Horowitz pitch crypto, it’s ‘little tech’ challenging the big guys.

Moreover, these guys have a cultural affinity for Vance, a fellow venture capitalist. And these are not standard corporate CEOs, this group, along with Vance, believe they are entrepreneurs up against a powerful liberal establishment bent on war and control.

Still, there is not total alignment. There is a small but important age split, with these venture capitalists coming of age in the prosperous 1990s, and Vance in the disastrous 2000s. Because of this difference, Vance has much less trust in U.S. institutions, and wants to see Republicans realign the country around a working class coalition, which is something Andreessen and Horowitz don’t care about as long as the government gets out of their way in crypto and fintech.

Politicians are leaders of coalitions of people who don’t align on everything, their job is to bridge those differences as long as they can. In opposition, that’s easier, since all you have to do is get people to agree they don’t like the guy in charge. For now, a crypto-boosting venture capitalist and a citizen in East Palestine who feels betrayed by the railroads don’t have to agree on anything except they don’t like Joe Biden. Moreover, Vance is a venture capitalist, and a working class Ohio kid, so he can appear as either, just as Biden could code as a safe politician and as a populist.

So what happens if the Trump/Vance ticket becomes President Trump and Vice President Vance? There are huge swaths of policy where there is no conflict within this coalition, such as war and peace, and crypto. There’s even working class alignment with crypto venture capitalists and the PayPal mafia crew on some areas, like the CFPB’s rule to let consumers port their own data, monopolization cases against Google, Amazon, Facebook, Ticketmaster, and Apple, attacking pharmacy benefit managers, certain social questions, and limiting the power of the big prime defense contractors.

But in plenty of areas, like prohibition of acquisitions by big tech firms, labor standards, de-globalization, immigration, and preventing financial scams against working people, well, it gets dicey. It is in these places where there will likely be internal warfare, with Vance balancing his Silicon Valley experience, his youth, and his intuitive sense of how voters understand governance. I suspect Vance and the populists on the right will try to find institutions that can organize a nascent working class coalition, whether that’s labor unions, new advocacy groups, smaller and medium size corporations, and/or different ways of structuring government or working with allies in the trade space or within Congress. They may also try policies to elide such conflicts, like subsidizing venture capitalists to invest in corporations that help working people. But ultimately, this fight is youth vs experience, the bracing experience of the war in Iraq vs the belief it’s the endless decade of the 1990s.

All that said, Vance has a boss. Trump is the guy setting policy and defining the role that Vance will play, and Trump has made it clear that, while he agrees that big tech is a problem and seeks higher tariffs and lower interest rates, he is otherwise focused on an orthodox set of GOP policies. As I noted a month ago, Trump is different candidate this time around, he is not attacking big business anymore. In a recent Bloomberg interview, Trump talked about selecting JP Morgan head Jamie Dimon as Treasury Secretary, cutting corporate taxes, keeping TikTok, a “love-fest” with CEOs, and retaining Jay Powell as the head of the Federal Reserve. He is even gingerly discussing distancing himself from Taiwan in the face of Chinese power. And the Republicans in Congress – who are largely still libertarian – will get their say as well.

The Vance pick matters. If Trump loses this election, Vance is set up to run in 2028. If Trump wins, Vance will be a close policy advisor. Regardless, it’s going to take a lot of work to break through the institutional obstacles against populism on the right. And campaigns are not where realignments happen, they are only where promises are made. It’s in governance when the voters decide whether they like the current order. In 2006, 2008, 2010, 2014, 2016, 2018, 2020, and 2022, they’ve picked ‘throw the bums out.’ At some point a new coalition will cement a governing majority.

Thanks for reading! Your tips make this newsletter what it is, so please send me tips on weird monopolies, stories I’ve missed, or other thoughts. And if you liked this issue of BIG, you can sign up here for more issues, a newsletter on how to restore fair commerce, innovation, and democracy. Consider becoming a paying subscriber to support this work, or if you are a paying subscriber, giving a gift subscription to a friend, colleague, or family member. If you really liked it, read my book, Goliath: The 100-Year War Between Monopoly Power and Democracy.

cheers,

Matt Stoller

P.S. I’m looking for someone to cover the Google adtech monopolization trial in September for BIG and Big Tech on Trial. If you’re interested, send me a resume and writing sample.