O P I N I O N

Private Money, Public Policy
What Won’t Tech Money Buy?

PALO ALTO, California — It did not take long for the tech industry to become the new establishment, and to assign itself the rights and responsibilities that come with such prosperity.

In 2010, Bill Gates and Warren Buffett unveiled the Giving Pledge, a take on the old industrialist Gospel of Wealth for a new era of the super-rich. Since then, many of Silicon Valley’s most moneyed founders and chief executives, including Larry Ellison, Elon Musk, Pierre Omidyar, Tim Cook, Sheryl Sandberg and Mark Zuckerberg, have signed on to give most of their wealth to a vague “philanthropy.”

Peter Thiel, the serial tech-firm founder, entrepreneur, investor, libertarian and presumptive Donald Trump delegate, is not a signatory, but apparently feels no less passionately about using his wealth to make his world a better place.

Last week Thiel revealed that he had funneled “in the ballpark” of $10 million to legal support for plaintiffs suing Gawker Media, most notably Terry Bollea, aka Hulk Hogan, who recently won a $140 million judgment against the company in an invasion of privacy case. Thiel made no secret of his grudge against Gawker, since the company’s Valleywag blog revealed his homosexuality in a 2007 post that lampooned the straight male culture of Silicon Valley more than Thiel himself. (Thiel is, notably, an investor in the tech site Pando, a media property that regularly insults him in more direct terms.)

But as Thiel tells it, his action in the Gawker case was not about him, or about quashing free speech, but about litigation finance in a case with the potential to do a great deal of public good. In an interview with The New York Times, he called it “one of the greater philanthropic things that I’ve done. I think of it in those terms.”

Portraying a $10 million investment in crushing one’s enemy as a charitable act of justice that will make the world a better place is galling. But students of history can hardly be shocked. Tech’s elite, lauded for their originality, are influencing media, politics and society at large with a kind of venture philanthropy, much as their industrial predecessors did more than 100 years ago.

Andrew Carnegie’s Gospel of Wealth was ostensibly intended to inspire the self-made industrialists of the late 1800s to improve public life for the less fortunate, no matter how their industries might affect those less fortunate. By example, Carnegie funded public halls, libraries and education, and established foundations to continue donating his money after his death.

Cornelius Vanderbilt and Leland Stanford each used significant portions of their personal wealth to found idealistic universities, while John D. Rockefeller donated millions to education and scientific research amid criticism that good deeds could not clean his dirty money.

Whether their money came from oil, hotels, railroads or data, titans of industry have long held enough power to both influence the American political system directly and to hack it when necessary. Old money maintains the status quo, while new money openly endeavors to change it.

The robber barons of the 19th and 20th centuries were kings of infrastructure. The people with towering wealth today are kings of information. The rise of Silicon Valley is best understood as a new industrial revolution in this tradition. In many ways, it’s not at all revolutionary in the strict definition of that term.

In recent years, many of the industry’s elite have pledged financial support to schools, hospitals, police stations and homeless shelters, all while many of the industry’s companies have avoided paying taxes that would fund those same vital public institutions.

The “super-angel” investor Ron Conway has funneled his wealth into efforts to improve gun safety beyond legislation. Depending on whom you ask, Zuckerberg’s investment of billions into his own charitable fund for future giving was a grand statement in that Gospel of Wealth tradition — or a public relations stunt and an enormous tax dodge.

Any philanthropy seems legitimate when it aligns with your own goals. Even Thiel’s support of free speech is apparently complicated: In addition to the Gawker legal offense fund, he has also donated to the Committee to Protect Journalists and speaks passionately about preserving freedom for the kinds of journalists he presumably believes do not work at Gawker.

To many of Gawker’s critics, Thiel is a hero on a charitable crusade for justice. It would be safe to say that this is how his fellow Silicon Valley philanthropists would also define their giving. They are under a presumptive mandate to improve society according to their own values, purely because they have made a lot of money while most everyone else has not. The Gospel of Wealth dictates that this is not only their ability, but their responsibility.

We did indeed give them this mandate through our politics: loose campaign finance laws and lower tax rates. Through policies that have reinforced exceptional wealth disparities, we have allowed them not just to govern themselves, but us as well. Instead of encouraging the super-rich to self-impose a Gospel of Wealth and celebrating — or criticizing — their public gifts, the concerned public might take a different, simpler tack.

Thiel told an interviewer in 2012 that he feared the result of this precipitous wealth gap.

“In the history of the modern world, inequality has only been ended through communist revolution, war or deflationary economic collapse,” he said. “It’s a disturbing question which of these three is going to happen today, or if there’s a fourth way out.”

If we’re lucky, there may be, but Thiel isn’t going to like it. Wealth gleaned by way of tax dodges and monopolistic business practices is wealth stolen from the public, even when it is returned in the form of supposed gifts. Philanthropy has the power to do a great deal of good, but so do tax dollars allocated in an equitable democratic system. Perhaps it is time to adopt a Gospel of Government.

(Susie Cagle, a John S. Knight Fellow at Stanford University, writes about technology, policy and economics. This Op/Ed originally appeared in the New York Times on May 29, 2016.)