The government is not our business

Mike Masnick wrote an absolute banger of a column last Tuesday, explaining why Techdirt's editorial mission was changing. If you haven't read it, you should make time.

Masnick's post has been percolating in my brain all week. He's right: If you came of intellectual age here in Silicon Valley over the last decades, you've got insights into the national situation that might not be so obvious elsewhere. Mike gives excellent examples. I want to expand on his arguments, weave together some other ideas and explain what I see.

How we got here

During the first Trump administration, institutional guardrails largely held. The President himself was unqualified and incompetent to govern, of course, but he was surrounded by aides, Cabinet members and a handful of Senators and members of the House who contained his worst instincts and made sure, in most cases, that the government as a whole obeyed the law.

Radical right-wingers noticed. In the wake of that failed (on its own terms!) first Trump term, leaders of the MAGA movement teamed up with extreme right-wing corporate interests to draft Project 2025. It was the blueprint intended to steamroll the Constitution in a second Trump term, if one happened. It was hugely unpopular, so during the campaign Trump fled from it. Once re-elected, Trump appointed its authors and advocates to senior positions around him. They have gleefully begun implementing its program.

A key tenet of Project 2025 is to strip the government of its power to regulate industry for the benefit of citizens and to transfer money and power to corporate interests. That was a popular message among many of Silicon Valley's elite – Marc Andreesen, Ben Horowitz, Elon Musk, David Sacks and others embraced it publicly and spent heavily to elect Trump. JD Vance's signature professional accomplishment as a venture capitalist was selling himself cheap to Peter Thiel, en route to an understudy role in the White House.

This is important. Trump 1 failed due to poor planning and incompetence. This time around, Trump is surrounded by competent, prepared people. They weren't elected, but they'll use his malleability and inattention do make Trump 2 a very different administration.

Masnick's article explains in detail how the move-fast-and-break-things, get-forgiveness-not-permission ethos of Silicon Valley are now part of the administration's playbook in Washington. Elon Musk is defunding the parts of government he dislikes, closing whole agencies that were created and funded by Congress under Constitutional authority. States and others are challenging him in court. Even if they win, though – and that is not a given, with extreme right-wing interests having stacked the Supreme Court – the damage DOGE is doing will be irreparable in the short term, and perhaps in the long term.

Just for example: USAID is history. Its mission is canceled. Even if the legal system rules in favor of restoring its programs, its workers have dispersed. Its infrastructure has been destroyed. All the Court's horses and men couldn't put it together again. Win or lose at law, Elon has won on the ground.

That's the Silicon Valley playbook in practice. We should look more carefully at how the Valley operates to understand its implications for the country.

Enshittification

Silicon Valley runs on capital. Capitalism, as practiced in the US, operates strictly in the interests of shareholders. Andreesen, Horowitz, Musk and Sacks own companies. Those companies concentrate on generating returns in the form of profits and higher stock prices to reward their owners. The companies also have employees and customers, but their interests simply don't matter. Companies will exploit workers, lock customers in and charge higher prices for worse service if it allows them to return more value to shareholders.

Cory Doctorow calls this "enshittification." It's an ironclad, unavoidable outcome of a system that focuses pathologically only on the interests of shareholders.

Government-as-business makes sense if you own a government. We don't. We pay our taxes for services that government provides. We're customers.

The Federal government in the US under Donald Trump has been effectively captured by corporate interests and the very wealthy. A supine Congress allows Trump, Musk and the Cabinet to ignore laws they dislike, to eliminate programs that benefit ordinary citizens and to cut taxes on the rich, transferring even more wealth to themselves. Government works worse for you and for me.

This is exactly enshittification. It should not surprise us. We invited the tech bros in. We know how they operate.

It will get worse. Slashing budgets, firing experienced staff, gutting agencies will absolutely lead to failure in systems that we rely on. I'm confident that there will be excruciating failures of government under Trump that will hurt real people. I wish that it weren't so. The silver lining is that it will capture the attention of the government-as-business voter.

What can we do?

First of all, we need to acknowledge that the Federal government is not a business. Businesses maximize shareholder value. Governments ought to maximize social value.

And we need to recognize that this government is absolutely not our business. It is, right now, under the control of monied interests that don't share the aims of society at large. Money and power will flow to them, away from us.

That's bad, but it's fixable.

We have one market advantage as customers. Unlike in business, the Federal government is subject to elections every two years, for so long as that part of the Constitution holds (a topic for a future post). The 2026 midterms loom, and there's a good chance that chaos and failure will cause the electorate to fire much of current management.

Protest matters. Make your voice heard. Call attention to failure and corruption. It is at a minimum an affront the the failing and the corrupt. It is at best a call to others to make their voices heard, too. There will be cause to get very loud.

And it's still important that nonprofits, companies, states, cities, individuals with standing sue the government to enforce the law. The legal system is imperfect, but large and diverse. It has responded heroically in important cases in the past. We should give it opportunities to do so again.

I actually like capitalism

I want to append this brief coda to reconcile the ethical arguments I make above with what I think about the economy.

I'm a capitalist.

Lots of people who say that are actually labor – they work for a salary that gets paid by capitalists.

I mean it in a rigorous way. I've created companies. As a funder, as a founder, as a CEO, I've allocated capital in ways I thought best to create great products, to help my businesses grow, to drive good outcomes. I concentrate today on companies working on solutions to the climate crisis. I believe that we'll only address that crisis if there are businesses at scale generating attractive margins by working on it. That will allow us to do more of the good work that needs doing.

I honestly think that capital allocation is a kind of magic. It's an exceptional way to accomplish important things.

There are for sure better capitalists than me. I know quite a few of them personally! But my record's pretty good. And by at least one measure, I think I'm a better capitalist than many folks staffing positions in the second Trump administration: I believe deeply in the value of competition. As Cory Doctorow points out in his recent post Gandersauce, it's not so popular in Washington.

I used the word "pathological" earlier in this post to describe a monomaniacal focus on shareholder value. I meant that. If you met someone who considered every action, measured every outcome only by how it benefited themselves, you'd justifiably consider that person a sociopath. That's exactly how businesses behave when they put the shareholder alone on a throne.

Good capital allocation, with lots of competition, will absolutely encourage innovation. We need more of that, subject to thoughtful regulation that does for the citizenry what it cannot do for itself. Monopolies, fraud, negative externalities pervert the social good of capitalism. Government has an important role in keeping them in check.

If you're looking for an excellent long-form audio primer on capitalism, its history, its impact and its possible futures, I highly recommend season 7 of the Scene on Radio podcast, Capitalism. It's hosted by John Biewen and Ellen McGirt. Each of the twelve episodes is excellent. Their progression is well thought out, so I encourage you to listen to them in sequence. You can skip the bonus episode, number 13, but the series overall is really great and worth the time.