Billionaire Orders Kamala Harris to Fire Lina Khan

LinkedIn founder Reid Hoffman gave $10 million to Harris' campaign and demanded an end to Biden's tariff and antitrust policies. Bernie Sanders reacted angrily.

Matt Stoller

Jul 25, 2024

As I’ve written, for the last few weeks, there has been a campaign among big business advocates to eliminate the new trade, antitrust, and labor policies put in place over the last five years or so. When Kamala Harris took over the Democratic nomination from Joe Biden, that campaign ramped up.

A few days ago, billionaire LinkedIn founder Reid Hoffman gave $10 million to the Kamala Harris effort, and promised a lot more. Hoffman is a Silicon Valley titan, part of the “PayPal mafia” that includes Peter Thiel and Elon Musk, though Hoffman sits on the Democratic side of the aisle. This morning, Hoffman went on CNN and issued demands. Harris must end Biden’s tariff and antitrust regimes, he said, and fire Federal Trade Commission Chair Lina Khan. Here’s the clip.

This appearance was followed by reporting that there’s a Silicon Valley fundraising tour for Harris being planned by none other than… Reid Hoffman. Ok, so it’s pretty stunning for an oligarch like Hoffman, with a net worth of a couple billion dollars, to publicly make such a demand. So why is he doing it? One reason is that there’s a lot of money involved. As the Lever reported, Hoffman is on the board of Microsoft, which is right now being sued and investigated by the FTC. It’s a pretty good gig, if you get to fire the law enforcer investigating your misdeeds.

Still, there’s another reason. Hoffman is a sophisticated operator who wants to be a kingmaker in politics. The money is real enough, but he’s likely leaking the fundraising tour as a means of forcing Harris to be seen to do his bidding. Hoffman wants Harris to get rid of Biden policies which protect workers through trade and antitrust so that big business can do what they want. And he’s going to supply the financing for Harris’ campaign if she does what she’s told.

It seems like the Harris campaign might be listening, despite Harris a few days ago hitting Trump over very similar arguments about taking money from oil titans and doing favors in return. Yesterday, the New York Times wrote a campaign story on the candidate’s links to big business. Here’s the key passage:

As vice president, Ms. Harris has voiced support for regulating artificial intelligence. But she has expressed skepticism of Ms. Khan’s expansive view of antitrust powers, according to a donor who has spoken privately with the vice president.

An anonymous secondhand conversation with a donor isn’t great evidence for Harris’ policy instincts. But one possibility is that the Harris campaign set up these reporters with sources, and is trying to imply that she’s open to the demands of executives so that she can collect more campaign money from billionaires and dealmakers. There are other possibilities as well.

So far, Hoffman’s demand has been met with disinterest from the political press and a muted response from labor and progressive groups, who have mostly endorsed Harris and are enthusiastically celebrating her candidacy. There are a few exceptions. Senator Bernie Sanders chimed in angrily about Hoffman’s demand, and Senator Elizabeth Warren offered an endorsement of Khan. A pharmacist group also weighed in, and there will likely be more statements as the news filters through a very confused media environment, as Khan has a lot of fans (including in tech, she’s speaking at YCombinator today to a packed room).

All that said, Hoffman’s level of sophistication here is significant. A lot of billionaires are good at grabbing money, and little else. While known as a Democrat, he was a large donor to former Boeing board member and GOP Presidential candidate Nikki Haley, and he praised Trump’s deregulatory moves, though he criticized the Republican candidate for being bad for business due to tariffs and political instability. He also went after Trump supporting venture capitalists a few weeks ago for attempting to “buy influence.”

Hoffman laid out his political philosophy in 2018 in what seems like a business book, one titled Blitzscaling: The Lightning-Fast Path to Building Massively Valuable Companies. In it, Hoffman analyzed the rise of companies like Uber, Google, Microsoft, AirBNB, Amazon, Apple, and so forth, argued that monopolization through cheap capital and lawbreaking is socially beneficial, and that such firms should be admired for their mergers and acquisitions strategies and network effects that thwart rivals. When looking at which firms to laud, Hoffman knew to avoid using the term ‘monopoly,’ substituting the word ‘dominant,’ which he puts in his book 29 times as a positive affirmation.

Hoffman might seem to be simply expounding about commerce, but in fact he is oriented around politics. Hoffman believes the goal of any entrepreneur is to ignore everything except growing so quickly that a business elevates itself to sovereign levels of global power. He even uses the terms “Nation” and “City” to describe such a corporation. Once there, they must become good corporate citizens. “If you previously ignored issues such as diversity, legal compliance, or social justice,” he writes, “you need to understand that all eyes are now on you, and you'll be expected to behave as a responsible citizen and role model.”

Such a statement is a rebuke of some basic elements of our social order. After all, what does it mean to ignore issues such as “legal compliance” until you’ve built dominant market power? Well, that’s as close as you can get to saying that breaking the law to form a dominant corporation is virtuous. There’s an expression that behind every great fortune is a crime and Hoffman is basically saying that yes, that’s true, except such crimes are good if they are paired with diversity mandates, statements about social justice, and legal compliance regimes.

Hoffman is also explicit that corporate leaders, when they acquire such market power, become politicians. “Like it or not,” he writes, “when your company is a City or a Nation, you need to start thinking like a mayor or a president and set rules for the good of humanity as a whole rather than just for the good of your profits.” Combined with his outspoken disdain for public regulation, and his arrogant public comments pairing large donations with specific political demands involving his own self-interest, it’s a powerful statement that his politics is not about Republicans or Democrats, but instead about ensuring that a small number of corporate and financial leaders make the core decisions in our society.

In other words, democracy really is on the ballot, but not in the way people imagine. An oligarch has explicitly and openly taken over policy because it conflicts with his small faction’s control of American society. And so far, most political leaders are silent.

The only upside here is that Hoffman is being very public, aggressive, and explicit about his demands. And he’s going to corner Harris until she kisses the ring, or refuses to do so. From his perspective, he’s not donating $10 million, he’s making a purchase. Or so he thinks. Now it’s up to Harris to make the choice. Does she have Silicon Valley donors, or Silicon Valley owners?