JD Vance’s rise to the Republican vice presidential nomination, with the ardent backing of tech investor and megadonor Peter Thiel, may seem unlikely given the tech sector’s longstanding role in Democratic Party fundraising.
But Thiel's support for Vance reflects a broader backlash against the power of traditional tech companies in the United States. Pro-tech Democrats get irritated against the Biden administration's antitrust initiatives, and Republicans nominate a former Silicon Valley venture capitalist who has expressed support for those same initiatives, it's clear that the tech sector is becoming even more politically fragmented.
Vance’s rise reflects the power of wealthy tech leaders who unapologetically affirm the tenets of techno-libertarianism, or the idea that tech companies should be free from most government intervention. This view is gaining political power and influence in the Republican Party. Thiel gave Vance a job at his Silicon Valley venture capital firm and drove Vance's success. Ohio Senate Campaign for $15 Million —the largest amount ever given to a single Senate candidate, Politico reported in 2022. Also He connected Vance to former President TrumpMeanwhile, the tech billionaire Elon Musk supports Trump financially through its PAC America.
This represents a shift from the tech sector's reputation as a bastion of support for the Democratic PartyMany startup founders have worked on the progressive West Coast, particularly in California, and for years there has been a revolving door of Democratic officials leaving Washington for high-profile positions in Silicon Valley. Against that backdrop, the tech sector has largely promoted Democratic interests: including serving as campaign staff members, offering digital experience and acting as Major donors.
But as the sector has grown, so has the backlash against Big Tech, as well as calls from voters and politicians in both parties to regulate the industry. Antitrust initiatives, including those by current Federal Trade Commission Chairwoman Lina Khan, have raised alarm bells for tech companies seeking to preserve market share. For his part, Musk, blaming state “overregulation” and liberal politics, announced this month that he would move the headquarters of Twitter (formerly X) and SpaceX from California to Texas, highlighting the growing rift between the techno-libertarian wing and the Democratic mainstream.
Potentially complicating the picture, Vance has singled out Khan “As one of the few people in the Biden administration who I think is doing a good job,” Khan has filed antitrust lawsuits against large companies, including Amazon, so it might seem that Vance supports regulation and oversight. However, his position is more likely to reflect a pro-competition bias designed to maximize the number of companies that can compete with the big players. In fact, Thiel has He argued that Google is a monopolyand the donated to the then Missouri Attorney General. Josh Hawley at the time when the latter launched an investigation into Google (although Hawley denied any connection between campaign contributions and his research into the tech giant).
So it appears that the Vance-Thiel alliance is aimed at challenging companies that have been identified as potential monopolies and now represent an establishment that grabs power for startups that expect minimal oversight (such as the startups Thiel invests in and the electric vehicle sector Musk has sought to dominate). Thiel and Musk, as key figures in the techno-libertarian movement, are making a reasonable bet that their regulatory environment will be much more permissive under a second Trump administration. But at the same time, they have signaled an openness to policies that undermine dominant firms.
Of course, personal investments can change that calculus. Consider Trump’s massive about-face, from trying to ban TikTok’s operations in the U.S. to opposing the ban after meeting with a Republican mega-donor. Jeff Yass, who owns a stake in TikTok's parent companyIt also remains to be seen how long Trump's aggressive approach toward China's tech sector will last. exemplified by a preference for higher tariffs and export controlswill persist. Thiel has roundly criticized Apple and Google's ties to China. On the other hand, Musk's Tesla's business depends on the Chinese marketwhich is the second largest after the United States. As of 2023, nearly 40% of Tesla's battery components will also come from China, and the company is building a large battery factory in Shanghai.
By choosing Vance, Trump has enlisted the support of some of the world’s biggest capitalists, but the new fault lines in Silicon Valley politics have become harder to predict. If Trump wins, his administration could well bypass or scale back regulation, except for those companies and individuals perceived as too threatening to his and Vance’s allies.
Aynne Kokas is the author of “Data Trafficking: How China is Winning the Battle for Digital Sovereignty.”
