Silicon Valley is anti-capitalist
Given Silicon Valley’s tech dominance, I think it’s a key background fact for many plans. Silicon Valley, despite being the most profitable part of the American (and arguably world) economy, has a moderately anti-capitalist culture. I’m not referring to corporate balance sheets, but to things like this Paul Graham anecdote: “How many times have you read about startup founders who continued to live inexpensively as their companies took off? Who continued to dress in jeans and t-shirts, to drive the old car they had in grad school, and so on? If you did that in New York, people would treat you like shit. If you walk into a fancy restaurant in San Francisco wearing a jeans and a t-shirt, they’re nice to you; who knows who you might be? Not in New York.” ( Paul Graham, “Cities and Ambition” ) (I can’t confirm that myself, as I don’t frequent fancy restaurants, but it’s the type of thing I’m referring to.) I’ll go through some details to both support my position, and flesh out what exactly it means. To be clear, I don’t think this is purely good or purely bad. Like a lot of things, the effects depend a lot on who you are and what you’re doing.
The book Monkey Business , an investment banking “memoir”, begins with this anecdote as the authors graduate from business school: “A few years ago, Rolfe and I stood on the edge of what we thought was a desert. Across the desert we believed we saw a lush, green oasis. We hoped that the pleasures of that oasis would one day be ours. The more we thought about the oasis, the more convinced we were of the untold pleasures that lay within its luxuriant borders. There was only one problem. The desert. When we first started out as investment banking associates, the oasis was represented by a coveted appointment as a managing director of the firm. We were willing to cross those hot burning sands, the interim years as investment banking associates and vice presidents, in order to one day bask in the shade of a palm frond.”
These guys knew exactly what they wanted. They joined the bank solely to get rich, to make millions of dollars a year, and anything that happened between here and there was just an obstacle to be endured. One might reasonably compare that to a San Francisco startup founder, working late nights and weekends in hopes of getting a big IPO.
But the large majority of new grads entering Silicon Valley don’t have that attitude. They aren’t dead-set on building a huge company and buying a Maserati. At Google, the average employee wants to have fun and start a family and lead a pretty normal life, and chose to work at Google largely for the perks or prestige or job security, instead of maximizing salary. Insane hours happen in some places — Lord have mercy on game developers — but they aren’t an industry norm, like in medicine or corporate law. The now-infamous Silicon Valley perks, like the ubiquitous foosball tables, exist because employees really do look at them when choosing where to work. If everyone just looked at their offer letters and chose the bigger salary number, no one would ever build company massage rooms or ball pits.
A decade or two ago, when American politics still had some first-world features, rich people and CEOs tended to vote Republican. It’s obvious why; the Republicans always had been the “party of business”, going back to 19th century Northern industrialists. They favored lower taxes, especially on corporate and investment income, and fewer regulations on business and employment. As late as 2012, many Fortune 100 CEOs supported Mitt Romney. But Silicon Valley and the Bay Area in general were always heavily Democratic. Mark Zuckerberg told Barack Obama on live TV that he wanted to be taxed more . Bill Gates has said similar things. And the data backs this up; a Stanford GSB survey of tech entrepreneurs found that large majorities supported wealth redistribution. Most are not hardline communists — although I’ve certainly met some of those — but broadly support overall social good over the right to private property.
Burning Man. If I called my dad, who’s a pretty average middle-class salesman, and I asked him to imagine a “party for rich people”, he’d probably think of big mansions, private islands, luxury resorts, everything you’d see in a Bond movie. He’d never think of a dusty, alkali desert in the middle of nowhere. But of course, that’s what Burning Man is, and it’s pretty clearly the biggest Silicon Valley event. Lots of top executives go, and there’s a credible rumor that Eric Schmidt was hired as Google CEO because he’d been to Burning Man.