Musk, Thiel Endorse Trump, Vance. What Would Their Ticket Do for Tech?

by Aynne Kokas

J.D. Vance’s ascension to the Republican vice presidential nomination with the fervent support of tech investor and big donor Peter Thiel might seem unlikely given the tech sector’s long-standing role in Democratic Party fundraising.

But Thiel’s support for Vance reflects a larger backlash against the power of traditional tech companies in the U.S. With some pro-tech Democrats chafing at the Biden administration’s antitrust efforts and Republicans nominating a former Silicon Valley venture capitalist who has expressed support for the same efforts, it’s clear that the tech sector is still dividing politically.

Vance’s rise reflects the power of wealthy tech leaders who unapologetically espouse the principles of techno-libertarianism, the idea that tech companies should be free from most government intervention. That view is gaining political power and influence within the Republican Party. Thiel gave Vance a job at his Silicon Valley venture capital firm and boosted Vance’s successful U.S. Senate campaign in Ohio by $15 million—the largest amount ever given to a single Senate candidate, Politico reported in 2022. He also connected Vance to former President Donald Trump. Meanwhile, tech billionaire Elon Musk has been a financial backer of Trump through his America PAC.

That’s a departure from the tech sector’s reputation as a bastion of Democratic Party support. Many startup founders hail from the progressive West Coast, particularly California, and there’s been a revolving door of Democratic officials leaving D.C. for high-profile Silicon Valley jobs over the years. Against that backdrop, the tech sector has been a major contributor to Democratic interests — including through campaign staffing, offering digital expertise 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 on both sides of the aisle to regulate the industry. Antitrust efforts, including by current Federal Trade Commission Chairwoman Lina Khan, have sounded alarm bells for tech companies eager to preserve their market share. For his part, blaming the state for “overregulation” and liberal policies, Musk announced this month that he would move the headquarters of X and SpaceX from California to Texas, underscoring the widening divide between the techno-libertarian wing and the Democratic mainstream.

Potentially complicating the picture, Vance singled out Khan “as one of the few people in the Biden administration who I think is doing a pretty good job.” Khan has filed antitrust lawsuits against major companies, including Amazon, so it might seem like Vance supports regulation and oversight. But it’s more likely that his stance reflects a pro-competition streak aimed at maximizing the number of companies that can compete with the big players. Indeed, Thiel argued that Google is a monopoly and donated to then-Missouri Attorney General Josh Hawley around the time the latter opened an investigation into Google (though Hawley has denied any connection between the campaign contributions and his investigation into the tech giant).

So the Vance-Thiel alliance appears to be aimed at challenging companies that have been identified as potential monopolies and now represent an establishment that is hoarding power away from emerging companies that hope for minimal oversight (such as the startups Thiel invests in and the electric vehicle sector that Musk has sought to dominate). As key figures in the techno-libertarian movement, Thiel and Musk are making a reasonable bet that their regulatory environment will be much more permissive under a second Trump administration. But they have also signaled an openness to policies that undermine dominant companies.

Of course, personal investments can change that calculus. Consider Trump’s sea change of heart, when he tried to ban TikTok from the U.S. and then opposed the ban after meeting with GOP megadonor Jeff Yass, who owns a stake in TikTok’s parent company. There’s also the question of how long Trump’s otherwise hawkish stance on China’s tech sector, exemplified by his preference for increased tariffs and export controls, will last. Thiel has sharply criticized Apple and Google’s ties to China. Musk’s Tesla business, on the other hand, depends on the Chinese market, 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 major battery plant in Shanghai.

By choosing Vance, Trump has managed to secure the support of some of the biggest money in the world. But the new fault lines in Silicon Valley politics have become harder to predict. If Trump wins, his administration could avoid or roll back regulations—except for those companies and individuals seen as too threatening to him and Vance’s allies.

Aynne Kokas is the author of Trafficking Data: How China Is Winning the Battle for Digital Sovereignty.