Why Tech companies are getting political


By David Boaz

President Donald Trump has tried to court executives of technology companies. Before he even took office, he hosted the heads of such companies as Google, Amazon, Microsoft, Facebook and Tesla at Trump Tower.

But now his policies on trade and immigration are generating strong pushback from the tech industry. Silicon Valley executives sharply criticized Trump’s executive order temporarily barring entry from nationals of seven Muslim-majority countries. Under public pressure, Uber founder Travis Kalanick left Trump’s business advisory council, and competitor Lyft has reportedly pulled its ads from Breitbart, a website formerly led by Trump strategist Steve Bannon. Several firms and executives also announced millions of dollars in donations to the ACLU to fight the order and to immigrant aid organizations.

No company wants to annoy the president of the United States, especially one who gleefully denounces firms and executives and threatens to use his power to hurt them. So when big companies take on Trump so openly, we know they must view his policies as a real danger to their operations.

In an industry desperate to find engineering talent, Silicon Valley executives may also be particularly sensitive to their employees’ generally liberal views on social issues such as abortion, gay rights and immigration. They know that skilled employees want to work for a company that shares their values.

Immigrants have been crucial to the development of the technology industry in the past 50 years, from Andy Grove and An Wang in the early years, to Satya Nadella of Microsoft, Sergey Brin and Sundar Pichai of Google, Pierre Omidyar of eBay and Omid Kordestani of Twitter. Not to mention Apple founder Steve Jobs, the son of a Syrian immigrant.

Indeed, more than half of the country’s $1 billion startup companies had at least one immigrant founder, according to the National Foundation for American Policy.

Tech firms are even more worried about a draft of an executive order that would revamp the work-visa programs technology companies depend on to hire tens of thousands of high-skilled immigrant employees. The draft order would promise to “prioritize the protection of American workers,” but technology companies say they can’t find enough Americans with the skills needed for software design.

Now tech executives are drafting a formal letter objecting to the policy. An early version of the letter says, “Our ability to grow our companies and create jobs depends on the contributions of immigrants from all backgrounds.”

Tech companies also strongly support expanded international trade, including the Trans-Pacific Partnership, which Trump withdrew from on his first full weekday in office. “45 million American workers, 105,000 in (Silicon Valley) alone, should be crying (over) this executive action today,” said Carl Guardino, president of Silicon Valley Leadership Group.

For years, many tech companies tried to ignore Washington. Microsoft in Seattle, Apple and Google in Silicon Valley, went about their business, developing products, selling them to customers, and — happily, legally — making money. But it seems that every successful company eventually finds out that it can’t just work on improving its products and serving consumers. Sooner or later, it’s going to have to deal with politicians and regulators sniffing around its business.

Trump’s number one promise was to create more jobs in the United States. But his trade and immigration restrictions will encourage US companies to outsource research and engineering projects to countries such as Canada, Ireland, and India.

When the federal government restricts trade, limits companies’ ability to hire the best employees and levies the highest corporate tax rate in the developed world, it hurts US companies’ growth. When it also launches antitrust investigations of successful companies such as Microsoft, Google and Apple, companies feel they have no choice but to get involved in politics and lobbying.

And that’s a shame, because the most important factor in America’s economic future — raising everyone’s standard of living — is not land, or money, or computers; it’s human talent. And we all lose when some part of the human talent at America’s most dynamic companies is perted from productive activity to protecting the company from political predation and destructive policies.

David Boaz is executive vice president of the Cato Institute and author of “The Libertarian Mind.” Send comments to [email protected]

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