July 2010, Week 4


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Thu, 22 Jul 2010 21:51:33 -0400
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Left Margin

A Hoop Dream, Politics & the Long Reach of High Tech Money

By Carl Bloice - BlackCommentator.com Editorial Board

July 22, 2010, Black Commentator


Larry Ellison was ready to pony up more that $400 million of
his own money to buy the Golden State Warriors but, alas, it
was not to be. A couple of entertainment moguls came up with
the winning bid. The loser is what you might call a Silicon
Valley entrepreneur; CEO of Oracle and reportedly the sixth
richest person in the world. The news got me thinking about
the numerous references to the virtues of "entrepreneurship"
being injected into the discussion about the current economic
crisis. If you listen to some of the New York Times
commentators the key to overcoming the present situation -
including high unemployment - is pouring resources into high
technology research and development. The genius and the
future, it is said, lie with bolstering young innovators
toiling away in garages. After all, that's what produced the
internet and it's where people like Ellison got started.

Obviously there are two sides to the Silicon Valley story. On
the one hand, there are the creative innovators working alone
or in small groups, sharing knowledge freely and coming up
with the fantastic technology we enjoy today. On the other
hand, there is the business side. Capitalism hasn't gone away
and internet technology hasn't fundamentally changed its
nature. The growing wealth inequality is as present in the
lands just south of San Francisco as it is in the country as
a whole. What's more, today there are politicians who made
their fortunes in advanced technology and are today trying to
buy anything they covet, including government power.

Take Meg Whitman, former CEO of eBay. Sometimes when I turn
on the television I am forced to listen to her at nearly
every commercial break, talking about unemployment. Other
politicians, she says, don't really sense the seriousness of
the situation because "they don't see it every day," followed
by: "I see it every day." And, I'm like, where does she see
it every day? Surely not from the window of her $3.2 million
Atherton mansion - population 7,535 - second wealthiest city
in the country. Perhaps she sees it every night when she
closes her eyes, only to be taunted by the recollection of
tech industry workers she has, in her various boss positions,
laid off, plus the ones she proposes to add to the state's
jobless rolls.

Whitman has chalked up quite a record of eliminating jobs and
arranging big bonuses for herself and other management
personnel. The California Labor Federation calls her a
"serial outsourcer" who sent 40 percent of eBay's jobs to low
wage areas abroad. Between 2002 and 2007, Whitman increased
the number of overseas workers at eBay by 666 percent, rather
than keeping jobs in California.

Whitman has proposed cutting 40,000 state workers from the
payroll, including employees of the University of California
system. She has also joined the disreputable bandwagon of
those who would try to solve government financial deficit by
cutting retirement benefits for public workers through
raising the retirement age and doubling the percentage of
salaries going into retirement accounts.

Whitman spent $71 million of her own money to win the
California gubernatorial nomination and is expected to spend
$150 million more trying to win the general election.

Then there's Carly Fiorina, CEO of Hewlett-Packard from 1999
to 2005 and previously an executive vice president at AT&T,
who also spent several million dollars of her fortune to win
nomination as the Republican candidate for Senate from
California, and is laying out even more trying to snag a
general election victory.

Heading up HP, Fiorina oversaw the layoff of thousands of
workers, sent jobs overseas and garnered big bonuses and
perks for herself and others in management. At her victory
party Whitman hailed the victories of "two businesswomen from
the real world who know how to create jobs, balance budgets
and get things done." Well, not exactly. Fiorina was actually
pushed out at HP with a $21 million severance package.

"We have been entertaining ourselves with theories about how
this election year is going to be all about voter anger,"
observes Times columnist Gail Collins. "Or Washington
insiders. Or health care. Or TARP. But really, it's going to
be about money. Gobs of cash falling on campaigns like tar
balls on a beach."

Oh yes, and there's Steve Jobs over at Apple. He recently got
into the discussion by correctly noting that the high tech
resources we have today are largely the outcome of government
spending. He's now arguing for more government outlays for
research and development. Concurrently, his latest product
has given the English language a new word: Applegate. It's
hard to imagine a worse quality control mishap than a new
massively promoted glorified cellphone that doesn't really
work too well. Since 2004, Apple products like the iPhone and
iPod have been manufactured and assembled in China. Currently
they are assembled by Foxconn. They are only conceived and
engineered in Silicon Valley.

Conservative Financial Times columnist, Christopher Caldwell,
had an interesting comment last week on Bill Gates of
Microsoft and his family's well known philanthropic activity.
Writing about Berkshire Hathaway's Warren Buffett, and his
recent pledge to leave 99 per cent of his fortune to charity,
Caldwell, senior editor at the Weekly Standard, wrote, "Most
readers of the Fortune magazine exclusive in which the Giving
Pledge was rolled out were pleased with the idea.Yet the most
striking thing in the hundreds of letters posted on the
magazine's website was the level of anger in many of them. `I
guess Mr. Bill Gates will give all his money to India,' runs
a fairly typical negative comment, `since he was so fond of
outsourcing all American computer systems analysts /
programmer jobs to India.' The Gateses and Mr. Buffett may
have misjudged the public mood. In opening their wallets,
they have opened a debate on whether it is right that they
should have so much money to begin with."

Caldwell makes another interesting comment about the
billionaires' largess:

    "If there is something wrong about businessmen
    campaigning through their money, there should be
    something even more wrong about businessmen governing
    through their money. Yet governing through money is what
    most present-day philanthropy does. Very few billionaires
    `give away' their money, in the sense of surrendering
    control over it. They deploy it, through tax-exempt
    foundations, to ends of their own choosing, and this can
    have disruptive effects on democracy, no matter how noble
    the hubristic billionaire believes his aims to be."

Back to Larry Ellison. With a fortune estimated to be $28
billion, he is reportedly the sixth richest person in the
world, the third richest in the U.S. and likely the
wealthiest in California. He has homes in San Francisco,
Malibu and Atherton and a compound in Woodside in the Valley.
I don't begrudge the man the money, even if along the way he
outsourced a few jobs to earn it. What bothers me is that, at
a moment, when a lot of sanctimonious criticism is leveled at
a former Cleveland Cavalier, the great Lebron James, for
acting in his own best interest, playing by the rules of the
system when selling one's labor power (albeit with a touch of
Hollywood and Madison Avenue), this entrepreneur sets up to
buy a whole basketball team. That would have put him in a
position to make even more money off the labors of players
like Steve Curry, Monta Ellis, David Lee and Vladimir
Radmanovic. I'm glad it didn't happen. ________________

BlackCommentator.com Editorial Board member Carl Bloice is a
writer in San Francisco, a member of the National
Coordinating Committee of the Committees of Correspondence
for Democracy and Socialism and formerly worked for a
healthcare union


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