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One of the surprising, at least to me, aspects of the Trump regime has been the large role played by Silicon Valley billionaires, who we used to think of as fairly liberal or at least libertarian. So I spoke with Jacob Silverman, whose new book Gilded Rage talks about how that happened. Transcript follows:
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TRANSCRIPT:
Paul Krugman in Conversation with Jacob Silverman
(recorded 10/27/25)
Paul Krugman: Hi everyone, Paul Krugman again. This week I’m talking with Jacob Silverman who has a new book called Gilded Rage, which is about one of the, unfortunately, really important aspects of our political life, which is the hard right turn of a lot of the biggest guys in Silicon Valley. I wish we didn’t have to care about these guys’ motivations, but we do. Hi, Jacob.
Jacob Silverman: Thanks for having me.
Krugman: Lots of areas to talk about here, but maybe as a starting point: some people say that Silicon Valley turned right because the Biden administration started trying to regulate them and impose antitrust on them, that was the turning point. But your theme in the book is that they actually did fine under Biden, but also that the turn right had begun quite a ways before. You want to talk about what you saw happening and maybe a bit about how you became sensitized to it?
Silverman: The book itself was probably inspired by David Sacks, who is now better known as Trump’s “crypto and AI Czar”, but when he started getting more involved in California politics around 2021-2022 and especially the “recall the reformist D.A. Chesa Boudin”, which was successful—a couple successful recall attempts involving California politicians happened there—and he started saying that this was going to be a model for other political efforts around the country. That’s when I really started thinking about tech and how some of these tech elites are intervening more in politics. But in terms of its antecedents, I think you can put that in mile markers of various places.
I try to talk a bit about the post 9/11 consensus that developed and how at first, sometimes through coercion, but then through cooperation and at times mutual benefit, the tech industry really got involved in mass surveillance and formed a good relationship with the Obama administration. There was a revolving door there, at least on the consumer tech side, with companies like Uber and Amazon and this growing union of state, and corporate power progressed without a lot of interruption through both Republican and Democratic administrations. It’s more when we get to 2020 and the Biden administration and some of the social upheavals of the Covid era that I think you get this strong reactionary currents emerging.
Krugman: Your view is that this Silicon Valley, which we think of as having had this libertarian ethos, but they got basically very much intertwined with the national security state, and that goes all the way back to 9/11 and the years that followed?
Silverman: Yeah, I think so. We know that early tech history, or really Silicon Valley history, involves building microchips that would be in Minuteman missiles. In some ways, the idea of tech as a center of the counterculture—or whatever’s left of it—and this liberal bastion, seems like a middle period that’s bookended by something a lot different.
Krugman: Okay, that’s interesting because the surveillance state is one of those things that turns out: it exists, much more than we like to imagine. If you ever saw the old TV series “Person of Interest,” we kind of live much more in that world than we realize already.
That was a cultural shift, but not obviously a partisan shift. Some of the players that you talk about had already started to basically become increasingly rightwing even before 2020, right?
Silverman: Certainly someone like Peter Thiel, who’s discussed in the book and I think hovers over a lot of what we’re talking about—not least because JD Vance was his protege—he’s a dyed in the wool political animal who has been a right winger since he was in college. He’s long called himself a libertarian, but he’s also been very involved in politics in the state.
Krugman: But some of these guys still espouse libertarian ideas, “everything is supposed to emancipate you from the heavy hand of the state.” And yet, that’s not the kind of thing they’re backing now.
Silverman: I sort of see it on two tracks in a way. Someone like Theil, for example, has talked about funding the technology of freedom, what he was specifically talking about was seasteading, these attempts to literally escape mainstream politics. But then I think there’s also this parallel attempt by some of the same people to, “if we can’t fully divest ourselves from mainstream society and governance, then we’re going to take over the government and do what we can.” That explains some of the more recent electoral tilt.
Krugman: Okay, so “seasteading”, for our listeners is, either requiring an island or building a floating thing where you get to basically have your own libertarian utopia free from any state control, right?
Silverman: That’s right.
Krugman: Which hasn’t really happened, I guess.
Silverman: There’s been money put towards it, but nothing really to show for it.
Krugman: You trace in the book this anti-democratic sense, which actually kind of even predates Trump a little bit, certainly with somebody like Theil.
Silverman: Yeah. He’s someone who, since the 1990s, has written that he doesn’t think that democracy is essentially one of his main values. He has said that, “capitalism and true freedom are in tension with democracy,” and he much prefers capitalism, which is his vision of economic freedom above all. Musk even more recently—granted, he says whatever he wants and half the time he might be trolling—made reference to wanting a Roman style dictator.
A number of these guys do indulge in various anti-democratic ideas. Read Curtis Yarvin, the popular right wing theorist who would very much like a monarch for the United States. So, it is something I think that is more than just kind of idle talk for some of them.
Krugman: Yeah and of course, vast amounts of money thrown in. I think you actually worked briefly for Vivek Ramaswamy.
Silverman: I did, that was an interesting experience. That was early 2019, I believe, and I was doing some corporate ghostwriting at the time and someone said, “hey, you might be able to go work for this biotech company he founded,” and I didn’t know much about it, but it turned out to be a big startup for its kind at the time and an introduction to this world, and I wouldn’t necessarily say I learned a lot about the company itself. They didn’t have much for me to do, so I didn’t last very long, but it was a glimpse into a certain world of people of extraordinarily high ambition, very well connected.
I didn’t know him as a political person at the time. But soon after, when it seemed like he was being drafted into these political networks and started doing business with people like Peter Thiel and JD Vance, it kind of fell into place for me.
Krugman: I was struck by, I guess quite early on, he said that “we should fire a million federal workers,” which was sort of a preview of DOGE.
Silverman: That’s right. Some of the ideas that he started espousing, even invading Mexico, are now virtually Trump policies. I think people tend to dismiss lesser presidential candidates or ones that seem more like vanity runs, but I would say he’s someone who’s very smart, and I think whether you agree with him or not, and I don’t agree with him, but I think he’ll be around for a while.
Krugman: What struck me, as someone who says, “let’s fire a million federal workers,” which is half the civilian federal workforce; to say something like that requires having really no idea what the federal government does. I mean, there’s a level of ignorance of how the world actually works. That seems to be a common theme among a number of these guys.
Silverman: I should say, I think he’s smart in a more cunning, or operator capacity. But yeah, I think there’s this tendency in tech in some areas of finance that they think that they’ve discovered ideas for themselves or they have very little respect for experts. That’s something you hear from Marc Andreessen a lot, how much he hates experts. They don’t really entertain a lot of outside knowledge and they think that they’ve discovered ideas for the first time and that creates this arrogance and epistemological kind of narrowness that can be pretty troubling when it’s enacted by billionaires.
Krugman: It’s always struck me how these guys could afford to be the most informed people on earth. I mean, I did a back of the envelope that said that Elon Musk could personally afford to maintain an intelligence service roughly the size of Britain’s MI5. And yet he gets his information from random tweets and I guess from these private chats with his buddies. That’s kind of an odd thing. It’s obviously motivated.
Silverman: It’s strange, in some ways it reminds me of Trump, because Trump has the world’s greatest intelligence apparatus at his disposal, and he often just believes whatever Laura Loomer or whoever’s in the room tells him, or something he sees on Truth Social. It makes one call into question their states of mind or how they make decisions and how they ended up where they are. But it also makes it seem like some of these folks are just as susceptible to the political and algorithmic forces as the rest of us, even though they might be billionaires.
Krugman: Algorithmic forces, meaning?
Silverman: I’m sorry. Meaning whatever comes across the social media timeline or that they sort of become susceptible to the kinds of political polarization. I think that we see play out on social media.
Krugman: Yeah. Now we have Musk owning Twitter and trying to tilt it a certain way. But even before this amplification feature, if you’re going to be working on social media it really does tend to—now we’re seeing with AI even more—reinforce whatever tendency you’ve got.
Silverman: The word in AI is “sycophancy,” when these bots flatter you and say, “yeah, that’s a really good idea, let’s explore it more.” Of course, it’s a similar idea on social media, which is just engagements. We’ve long seen that these platforms are tuned for engagement, for keeping you on there, often to a lot of ill side effects, and not really for the health of the user.
Krugman: I guess it probably happened after we went to press, but that whole business in South Korea, where the president lost his mind and it appears that—in South Korea YouTube is apparently the dominant social media platform—he just went down a YouTube rabbit hole.
Silverman: That’s certainly something that happens and that’s a lot of how online radicalization works these days is that recommendation algorithms, or narrow online communities, funnel you deeper towards more extreme and self-reinforcing ideas.
Krugman: Sorry, I gotta share. I’m a very heavy YouTube consumer, but only for music and history. I’ve had to discipline myself, or train the algorithm, which means never ever clicking on anything, either A: political or B: involving cute animals. Otherwise, it totally screws up your feed. (laughs)
One thing that strikes me even more after reading your book is how angry a lot of these guys seem to be. They’ve got literally more money than anybody can spend and things have gone fabulously right for you and yet, so you talked about the reasons for that anger, but I’d like to hear from you a bit and then maybe throw a few things at you.
Silverman: I think it’s pretty palpable. That’s one reason why I call it a “gilded rage,” it’s that you hear it from them. We do hear from these people directly on social media and these long interviews they give on podcasts—some of them have their own podcasts—or speeches they give publicly. They’re all content creators now.
The emotion that often comes through is this sort of wounded anger, they feel victimized. Some of it is a bit in the style of classic right wing victimology, but it’s also, “the people don’t appreciate them enough and the world they’re trying to make,” whether it’s tech critics or regulators. But I think also they share a lot of the anti-woke grievances of the last few years, Musk very explicitly in his transphobia. The sense that progressive politics has somehow gone too far and has made everyone else’s lives oppressive and miserable seems to be an idea they share, despite all their wealth and power and the fact that I don’t think those left wing ideas had a major effect on tech. But, in some cases, I think it’s also personal. You hear someone like Bill Ackman say that, “Harvard turned his daughter into a Marxist,” or Elon Musk has talked a lot about his child coming out as trans. He said, “the woke mind virus killed my son.” That’s how he came up with this idea of “the woke mind virus”. He seems very angry about that.
Krugman: Two thoughts I had, let me bounce them off you. One is that these are, by and large, not young guys. These are people who’ve been prominent and wealthy for a long time, and even though they’re wealthier and more powerful than ever there seems to be a sense that their glory days are behind them. I have a couple of thoughts, but do you have a reaction to that?
Silverman: I think that’s an interesting idea because we are largely talking about people in their 50s and 60s who might have made their big fortune earlier, or let’s say someone like Marc Andreessen, who was a revolutionary in helping bring the web browser into being and then has been a very successful investor. But “bet big on crypto,” which didn’t do so well, there is a sense in which Silicon Valley might be out of big ideas. I’ve even heard someone like Peter Thiel talk about how AI is the only thing remaining. It’s the only bet that they feel like they can make, and that might speak to their poverty of imagination.
I think there is something to that. Both the idea of getting older and a lot of these guys also claim that they don’t want to die, and sometimes funding things to that effect. But it betrays a certain mindset and also a certain kind of insecurity that maybe they haven’t created the world that they want to make.
Krugman: Andreessen struck me as interesting because he made Netscape, the first real usable browser and it really did change things in a fundamental way. Then he ends up—caricaturing, but not too much—flacking Bored Ape NFTs. Obviously not a stupid man, but it’s got to feel like something of a comedown.
Silverman: I think also when these guys get more into the realm of financial engineering—I mean of course investment is a legitimate field but far removed perhaps from actually creating stuff—that also maybe creates a distance between them and everyone else.
Krugman: Peter Thiel looms pretty large. Thiel had this sort of manifesto, almost 15 years ago now where he said, “we were too obsessed with information and we need to get back to doing major stuff in the physical world. We were promised flying cars and instead we got 140 characters.” It’s a famous quote. But he hasn’t done any of that, has he?
Silverman: That’s very striking. That I think betrays or reflects a couple things. One, there is this great impatience with that. “We were promised flying cars, instead we got 140 characters,” that this future wasn’t delivered to them or it wasn’t allowed to them in some way. But also, why haven’t they done it? Marc Andreessen is someone who, while he was investing heavily in crypto and NFTs, was publishing this manifesto called It’s Time to Build. Well, why aren’t you all building? I mean, there are probably economic reasons for that, but I think it does show this profound disconnect between the world they imagined or even sometimes rhetorically argue for, and the one that their money and efforts are actually going to.
Krugman: This is something I think about a lot. There was, in fact, during this whole period of them being disappointed, there have been some material world technologies that have been revolutionary, I don’t think any of these guys were involved in renewable energy. We’ve actually had this drastic world changing developments in solar and wind and batteries and so on. And none of these guys seem to be either involved with or appreciative of it. You would think this would be exactly the kind of thing that the Peter Thiel of 2011 would have said, “this is what we should be doing.”
Silverman: You’re starting to hear a little bit of that from Musk again now that he’s split off from the administration, but that’s about it. I don’t know if it’s because of ideological capture on their part, but there have been amazing things happening in medical research. Or we could just point to mRNA research, but they seem much less concerned about treating illnesses now then these moonshot life extension projects.
Krugman: That’s right. I should have said the Covid vaccine was an extraordinary, life changing, life saving technological thing. And yet instead, they’re obsessed with AI and saying that’s the only thing, whereas what about all this other stuff?
Silverman: I think it’s potentially a much bigger world and one that could benefit from better allocation of capital. But that focus is so narrow on their end.
Krugman: Okay. Another thing that occurred to me is “the world is not celebrating us enough.” You do raise that theme quite a lot in the book. Can you tell me about that? Because I definitely see that, but I think there are reasons which they may not be willing to acknowledge, but when did that really start? When did they start saying, “why don’t I get the adulation I’m supposed to be getting?”
Silverman: I think broadly, before the 2016 election you had a pretty industry friendly press in regard to tech, exceptions of course, and nuances. But after the 2016 election and allegations about Cambridge Analytica or just in the role of social media in mobilizing voters and the fact that the Trump campaign worked pretty closely with Facebook, there was a big effort by the mainstream press to try to catch up and say, “okay, we need to actually start reporting more critically on some of these companies, or they have potential big effects in the real world.”
That shift, while late in coming and imperfect, was not handled well by the Andreessens and Musks and other types in this industry and even the new round of critical reporting that started appearing, some of it good, some of it not; was just not accepted as part of the bargain the way that other industries might be more used to that. I think you start hearing that more during the first Trump administration when there was this real exhaustion with people, especially people who aren’t technical, they don’t respect people who are just people like me writing for a newspaper or something like that.
Krugman: Yeah circa 2015, the tech industry was in huge admiration. Everybody loved them, and that kind of went away, although I would say that also went away in part because it kind of stopped being so interesting. Also we started to see the downsides.
Silverman: There have been many people in academia or labor or activist circles who’ve been trying to talk about some of those downsides. I think also within a lot of the mainstream public and tech press, there’s this initial charm about innovations like Uber, for example, and then you start to understand the labor issues or traffic issues or any other number of things of how these companies operate. It doesn’t seem so magical anymore, but Silicon Valley is this industry that really depends on that self-mythologizing and really seems to want us to accept it in a way that we don’t always really get from other industries that perhaps have a little more measured view of their role in things.
Krugman: Well, they have longer histories, but yeah, it does seem uniquely the desire for admiration is especially intense. Also in some ways, I don’t think it’s just the way we got accustomed, in some ways things got worse. I mean, literally Cory Doctorow’s new book Enshittification.
Silverman: Absolutely. I think we saw some interesting services and products introduced but, I wrote an essay sort of in this vein for the Financial Times a few months ago, that a lot of the everyday experiences with these products are worse. We know that they’re collecting tons of data on us and kind of undermining us in that way. But just using these apps or these various services from Google Search to the Patreon app, I was noticing just the other day: they’re crowded and messy and often don’t do what we want them to do.
Krugman: That’s interesting. Twitter had gotten fairly toxic even before Musk came along. I—even before Musk—had to stop and basically turn off comments. I had a lot of Twitter followers before I dropped out but I couldn’t use it as a vehicle for two way communication anymore because it was just infested with trolls, many of whom may not have been human.
So you have people who went from being culture heroes to being attacked by villains, but at any rate ambivalent and couldn’t handle it very well.
Silverman: Yeah, I think so. I think that that inability to handle that kind of ambivalence or the critiques that might be launched at other corporate leaders didn’t land as well with these tech leaders who did also want to be seen as celebrities a bit and kind of more available than movie stars; for example, we actually hear what some of them are thinking on X or other social media platforms and that kind of hybrid role maybe didn’t really work for that.
Krugman: That’s true. The extent to which people were both billionaires and celebrities, that was kind of a unique moment and not normal. Most business people are boring and kind of accept that that’s how it goes.
Krugman: And now even though they’d been bailed out and all that, they were absolutely enraged because at some point, Obama used the words “fat cats,” and how dare you? You do see some of this in other sectors, but it’s especially acute in tech.
Silverman: That’s an interesting parallel.
Krugman: I’m talking more than I usually like to.
Silverman: I could always riff longer. (laughs)
Krugman: Well, good. You know, the riffs are always good, but I’m wondering, maybe you can give me some insight here. These are guys who made enormous fortunes very fast, the long climb was shorter. Highly successful people, I’ve seen it in very limited ways in areas I know, but you’ve climbed the greasy ladder and you’re at the top, and then it’s kind of: “is this all it is?” It does look as if there’s a kind of dissatisfaction with the rewards to achievement.
Silverman: I think you could see this playing out with anything, from the greed, to the seeming desire for always more, the fact that someone like Musk says he needs $1 trillion in order to take humanity to Mars. The kind of self-directed philanthropy like that, it’s all about them. Maybe even with some of these guys it’s their reported drug use. There just seems to be a recklessness accompanying all this.
Krugman: Now, there was probably a lot more of that [drug use] in the original Gilded Age than history has reported.
Silverman: Well there is that, yeah.
Krugman: I have to say, the 50-something self-made billionaire completely hopped up on ketamine or whatever, with enough money to distort the whole political process, it’s kind of an alarming picture of where we are as a society.
Silverman: The only parallel I can really think of is Howard Hughes. But he was doing it from his hotel room.
Krugman: Yeah, and not trying to be a celebrity and all of that at the same time, he was a recluse.
Political views: if there is a new Silicon Valley ideology, which you do talk about a little, but tell me, the hostility to democracy, what is that really about?
Silverman: Well, I think that’s partially about their sense of their own supremacy, which in some cases is they think they’re genetic-elites or cognitive-elites. They think that they’re kind of a technocratic elite that has a right to rule and that the broader public just doesn’t really understand them or what they’re capable of, or what they want to do.
There’s this broader impatience with democracy that it’s brought us to this point of dysfunction and “woke excess” and whatever other complaints and grievances I think they might have. You’ve seen this play out for years, in various parts of tech—I think it was Larry Page or Sergey Brin—I believe Page I quote in the book. He said a number of years ago that he “wishes they had some island with no rules where they could test out new technologies.” Now they talk about charter cities are zones of exception. I think this also goes back to the idea we mentioned earlier of the impatience that “the utopian future hasn’t arrived”, and if it hasn’t arrived well maybe someone’s responsible for it and that someone seems to be a public that “doesn’t appreciate them” and a government that “stood in their way.”
Krugman: Which is odd for people who are so obsessed with, “we’re superior and we know more” and at the same time are hostile to the idea of expertise. Isn’t that a contradiction there?
Silverman: I would think so. It just seems humility doesn’t seem to be a big part of the package. They seem to respect that some of the expertise of their peers, perhaps the people in their inner circles or networks or friend groups, but beyond that not so much. Certainly no one who is steeped in the humanities.
Krugman: Or even medical science or whatever, which is odd. This is such a science based thing that they don’t seem to think the scientists count.
Silverman: Well, I wonder also if part of it is, especially with AI, that they think they can replace or renovate every industry with their products and with AI, from education to government, to medicine and whatever else that contributes to that lack respect for expertise or any incumbents because they just assume that: they make a good enough AI and it’s going to replace them eventually.
Krugman: Well, that’s quite recent. ChatGPT-original is three years old now or maybe less than that?
Silverman: Yeah not that long.
Krugman: This big shift in attitudes had happened already before then.
Silverman: That’s true. I do sometimes wonder—not that college is the be-all-and-end-all of being an educated person or a well-rounded person but—a lot of these people dropped out of college or especially fetishized the drop out of college in the case of Peter Thiel, who pays people to drop out of college.
That’s where some of that intellectual well roundedness might require some of that curiosity or even humility.
Krugman: One thing that’s interesting, my own encounters with people of great wealth—not that great of wealth but relatively—tend to be in context where there are several different worlds present. So there’s political senior officials and then there’s wealthy bankers more than tech guys, and academic economists, everybody at the top of their particular greasy pole. What I see there is not so much disdain for expertise as everybody wants to be what they aren’t. The politicians want to get rich. The academics want influence and the plutocrats want to be respected for their minds.
I’m wondering if at some point these people are sufficiently high level enough that they can just shut out any kind of expertise that isn’t them-and-their-friends and assume that they know better.
Silverman: I think that’s well-put. That’s something I discovered a little bit when I did some ghostwriting for wealthy people, that they want to be known for certain things that they might not be currently. There’s this clip that went around over the summer of Travis Kalanick, the former Uber CEO, on The All-In podcast talking about how he’s using ChatGPT or Grok, he was getting into sort of the nether realms of what was known in quantum physics and he started calling it “vibe physics.” I don’t think he was exploring the limits of known physics with the Grok chat bot, but he can sort of claim he was and then they just nod along.
Krugman: There was this recent incident where they claimed that an AI model had solved unsolved mathematical problems, and it turns out they actually were solved mathematical problems, they just didn’t know that the AI had found these obscure papers that solved them.
Silverman: Oh wow. I hadn’t heard of that one. That’s remarkable.
Krugman: Yeah. I saw something similar when Trump put his first set of tariffs, the Liberation Day tariffs. If you ask ChatGPT, “devise a set of tariffs that will eliminate the US trade deficit.” It came up with exactly those tariffs. We thought, “holy shit, AI is destroying us by giving bad policy advice.” But it turned out that it had actually scooped up—somehow it had ingested—Peter Navarro’s trade book and just spewed it back at us.
Talk a little bit about how they bought influence. Then I have a follow up on that.
Silverman: For one thing, they have become major donors mostly to the Republican Party, sometimes to Democrats (especially in California), they may want to keep all their bases covered. In the last election the crypto industry, which is a division of the tech industry, essentially became the biggest donor by-industry and really helped shape policy priorities in a way that I think we hadn’t seen before.
One thing I think back to is during the first George W Bush administration, when you had the Vice President, Dick Cheney, holding meetings with energy company CEOs off-the-books. That kind of thing seems to be replicated and blown up now or being done much more. That was a scandal at the time, but now it’s just like they’ve become almost partners in the campaign and in the case of Elon Musk, he donated probably a couple hundred million dollars through his PACs and various efforts and ascended, literally when he got on the stage, but also ascended to this place in the electoral cycle that I don’t think we had really seen before. Unfortunately, especially since Citizens United, we’ve had a lot of billionaire money in these campaigns and unlimited spending practically.
That close fusion and I think what also accompanied that was Trump not just changing his mind about crypto, but becoming a leading crypto entrepreneur right during the heart of the campaign season. That was something totally different. He not only took all this money and policy advice from that industry, but decided to go into business with them.
Krugman: Campaign finance is one thing and that’s huge, the role of crypto as the dominant corporate donor was new, but the direct enrichment of the president and his family: that’s a new chapter in American politics. These guys seem to be better positioned to do that or have better tools for doing that than other industries ever had.
Silverman: I think partially because they don’t have to create a real product that people want. I mean, yes, World Liberty Financial might want to sell to the broader public, but what they essentially serve as is the drop box for people who want to give money to Trump. That means, UAE princes, sovereign wealth funds and financial criminals from overseas, or Justin Sun, or Changpeng Zhao, as we saw recently both of whom have benefited politically.
Because there’s relatively low overhead, you can just keep doing this and every regulation or law or investigatory body that might put a check on this has essentially been dismantled and Trump has pretty broad legal immunity. So it just seems like something that can keep going without much stopping it.
Krugman: Yeah. The pardoning of Binance, Changpeng Zhao, that just happened a few days before we had this conversation. It’s truly extraordinary.
Silverman: This is something we knew might happen because it had been reported that they were talking and then CZ (Changpeng Zhao) claimed, “well, we hadn’t talked about this but now I want a pardon.” He said that publicly. You could see this coming. But each time one of these happens it’s very striking. This is arguably, not by prison time, but probably the biggest criminal in the world of crypto or certainly one of the most important figures and someone who pled guilty to a favorable deal because he saw the writing on the wall and his company was supposed to pay the biggest fine in U.S. corporate history, or at least close to it. It’s not just that he pardons him, it’s that they’re already in business together. So, the fact that it could continue to be so blatant, so brazen without any checks on it, is pretty troubling.
Krugman: The Gilded Age was pretty long, so there was a lot of corruption but it wasn’t ever quite as brazen as what we’re seeing now.
Silverman: I think also because we all know about it. Maybe some of these things were reported on well at the time, 120 years ago, but you can see this stuff happening today. You can even go on the blockchain and look at some of the data and see some of these bad actors paying World Liberty Financial and knowing that 70% of that money is going to go into Trump’s pocket. So, it’s very proudly trumpeted.
Krugman: At this point, we’re in a situation now where tech oligarchs feel that they’ve bought the government or are in the process of buying the government. And yet, history says that this doesn’t end very well for the people who think they’re doing that. You don’t even have to go back to the 30s, you can just look at what happened to the oligarchs who originally backed Putin. You think that you’ve bought the dictator but in the end “power grows out of the barrel of a gun,” and oligarchs who challenge have a “tendency to fall out of high windows,” do these guys not know about that?
I’m backing away to the ignorance level.
Silverman: They may not! There’s certainly an impulsivity to them, but I also think one thing worth remembering is before Trump was elected, there were so many investigations, formal or proposed, civil and criminal, touching on these guys directly or their investments. David Sacks, for example, invested in a telehealth company that was supposed to prescribe ADHD meds that turned out to be a Chinese pill mill, and its CEO was arrested.
There’s just all kinds of stuff like this that I think some of them latched onto Trump out of ideology, but also self-preservation and maybe not thinking about what might happen on the other side. I think Musk so far has been fortunate not to experience much retribution, but it is a reminder that power does still reside in the executive.
Krugman: So what you’re saying is, to a certain extent, it’s not just that they were greedy and thought that they could control Trump, but that they were already in trouble? They needed to own the government, or at least temporarily own the government in order to get out of their own messes?
Silverman: In a lot of cases, yes. There was a quote from Trump, he’s speaking to a group of crypto investors, the Winklevoss twins and others a couple months ago and he said, “you were in so much trouble.” That’s more obvious with crypto. But yes I think there’s an element of that. We can remember Musk being interviewed by Tucker Carlson where he said if Kamala won he was, “screwed and would go to prison.” Of course there’s some joking to that. But at the time, even he was going pretty far, arguably breaking election law by paying off people through his lottery.
Krugman: Wow. That had not occurred to me. We know that Trump needed to win the election to stay out of jail, but that it may be true of a bunch of the bros who backed him as well, that’s a new thought.
Although they probably haven’t thought about what happens 2 or 3 years down the line when, although you do talk about a little bit, Musk seemed to think that he was at least co-president, and now he’s very much on the outs. But he has not really suffered financially from it yet, right?
Silverman: I think that’s notable. I think it also reflects the relative but very minor restraint that Trump may have, compared to someone like Musk who’s tweeting in the middle of the night that “Trump is in the Epstein files.” But I think it also shows that the U.S government needs Musk for now. They need SpaceX for DOD satellite launches. He did lose the EV mandate, but Musk also has his own problems with declining Tesla sales overseas and the Chinese cars that are probably just as good, if not better. There are tools in reserve if the Trump administration wanted to go after him, from contracts to his immigration status.
But right now we’ve seen that power still lies with Trump and that a lot of the other tech people who are friends with Musk or are around him have still kept close to Trump. Sach is still there. Joe Lonsdale talked on TV about how most of the DOGE operatives are still in place. I think they still want to hang on and see what they can do here.
Krugman: Wow it is hard to believe. They went this far this fast, that’s what always gets me. I guess it’s probably an illusion but during the Biden years, we sort of had a normal government and people had connections, this has always been the case. Big money has always talked and Wall Street walked into Obama and talked him out of a lot of regulation stuff that he might have done, but it wasn’t like this. Now all of a sudden it’s this almost unrecognizable scene.
Silverman: I think one less element of that that we haven’t talked about as much might be the defense tech push and this idea that, not only are they moving to the right, but they’re very jingoistic and they don’t feel any of the moral quandaries of the war on terror issues or even the fights over surveillance, some of these companies sued the government over secret surveillance orders. But now they want to build weapons, it’s cool to do this. They want to work with the CIA or work with the Israeli government or whoever else, and there’s just no compunctions about that. A16z calls it “American dynamism.” Those ideas are very enticing and also involve a lot of government contracts so they just further that embrace that we’re talking about.
Krugman: Coming back to Peter Thiel and his: “why don’t we build stuff,” or adjacent. Who does build stuff? The Chinese. It strikes me how much we’ve, in pursuit of these guys’ ideals, abdicated a lot of what it is they claimed they were for.
Silverman: Very much so. Whether it’s on innovation or manufacturing capacity or really inventing new things here at home. It is pretty remarkable, some of the things we see coming out of the Chinese tech sector.
Krugman: The portrait you give us, it’s scary and sad because I don’t get the sense that any of these guys are happy. I mean, they got all this, and yet I think my life is better than theirs. (laughs)
It’s a really kind of awful thing. Fascinating. Not the society I expected to be living in quarter of the way through the 21st century. But here we are.
Silverman: I understand yeah.
Krugman: Well, thank you so much. The book is enlightening, slightly terrifying. It’s a window on where we are. I appreciate you taking time to talk with me.
Silverman: Oh, it’s a real pleasure. Thanks for your interest.
