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The tech industry has learned it doesn't rule the world alone

Facebook CEO Mark Zuckerberg didn't spend every minute Wednesday testifying before the House Energy and Commerce Committee. But he came prepared for his part in the time-honored American cultural phenomenon.
Facebook CEO Mark Zuckerberg didn't spend every minute Wednesday testifying before the House Energy and Commerce Committee. But he came prepared for his part in the time-honored American cultural phenomenon. AP

The founder and chief executive of Facebook has until recently been the centerpiece of the kind of business story that has become foundational to this country’s image of itself – the bold, innovative entrepreneur challenging convention and creating something new, generating huge wealth in the process.

Last week, Mark Zuckerberg found himself in the center of another time-honored American cultural phenomenon, this time in politics – the congressional hearing.

You know the drill. Some hapless witness is called before a committee so that preening senators or representatives can denounce, scold, chastise, lecture and harangue him, thus scoring points with the electorate.

Sometimes the subjects of this grilling – think of tobacco company executives – might even deserve some grilling and public shaming. That’s not the point of the exercise.

On a rare occasion the hearing might even lead to legislation to address the purported problem. That’s not the point either.

What’s at stake is face time, the chance to look concerned, to accumulate sound bites that prove “He’s (or She’s) Fighting For You!” All this melodrama needs is a convenient foil, a boo-and-hiss worthy villain. For the moment, Zuckerberg is it.

Just for once it would be entertaining to watch a witness dragooned before a congressional hearing begin verbally firing back with well-researched denunciations of the committee members’ scandals, gaffes, lies and lack of understanding about the subject on which said congresspeople are pontificating. There’d be no lack of material to work with.

But Zuckerberg took the route of most caught up in similar political storms, putting up a polite front of apologetic contrition, combined with vows to take seriously whatever the congresspeople want him to pretend to take seriously.

That he did so indicates not so much that Facebook, members of Congress or even the public are upset about privacy violations and sale of data by companies, but that there’s a new relationship between tech and politics.

For years, tech and politics were, at best, distant from one another, not just in geographic terms (D.C. vs. West Coast) but regulatory and relational as well.

Yes, the tech industry thrived because of basic research and development work the government sponsored on what became the internet, and yes tech companies have benefited from government contracts (Microsoft has collected a penny or two over the years for its software; Amazon sells cloud-computing services).

But the relationship is hardly as cozy as it’s been between, say, the government and defense contractors. Even within a tech-heavy state such as Washington, the sector hasn’t shown much inclination to get heavily involved in political campaigns or issues to the extent others have.

That’s changing. Tech’s size and wealth made increased attention from the political sector inevitable; that’s where the money is, for campaign donations, for tax revenues, for job-generating offices and facilities.

Tech companies might just as soon be free of increased political and regulatory attention, but that’s not going to happen. And having an ally in government could prove beneficial, especially at the federal level with the Europeans and Chinese in particular proving cantankerous on issues ranging from taxation to competitiveness, security and intellectual property.

Amazon’s HQ2 plan has been seen as evidence of tech’s changing attitudes toward government. Locally, it’s been interpreted as a warning shot at Seattle’s political leadership, elements of whom regard Amazon as a combination source-of-all-civic-ills and bottomless piggy bank.

Nationally, it has not escaped notice that three of the 20 finalist sites for HQ2 are in the D.C. metro area. We’ll know for sure, once the winner is named, what factors were most important, but putting the second headquarters in D.C. certainly wouldn’t be done because of affordable housing or less traffic congestion there.

If it does so, Amazon wouldn’t even be the first local company for whom a headquarters move had political implications.

When Boeing announced its decision to move its corporate headquarters out of Seattle, the finalists were Chicago, Denver and Dallas. Speculation was abundant at the time that by setting up shop in a new state, Boeing would add the political clout of its new corporate home to land government contracts, do battle with Airbus or whatever else it wanted to accomplish.

Amazon has been building its political base in other ways. Every one of those distribution warehouses it builds constitutes a splashy, immediate addition of hundreds of jobs, if not more, a fact not lost on the politicians in those locales. Jeff Bezos also owns a home in D.C., as well as the newspaper there. (It’s interesting that while he’s been the subject of another round of presidential tweets, Bezos has largely kept quiet, but then he’s not been one for Elon Musk-like pronouncements anyway.)

Tech is relatively new to this game, so it’s likely to make some missteps along the way. It’s also a relatively new industry, so it might try to apply new techniques and approaches to political influence.

Whatever options at its disposal for dealing with the political realm, though, the industry seems to understand that ignoring it entirely and hoping it goes away are no longer among them.

Bill Virgin is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at bill.virgin@yahoo.com.
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