Politics

(Washington)

Silicon Valley’s ascendance to the pinnacle of American corporatism and power has just been cemented—Google has now surpassed Goldman Sachs in terms of total political contributions. The company’s political action campaign, NetPAC, has so far spent $1.43m versus Goldman’s $1.4m. Four years ago, Google only spent a third as much as Goldman. The spending is a sign of just how aggressive Google has become in campaigning for its interests, and is this year focusing on issues ranging from tax, to immigration visas, to government spying. While tech industry workers tend to lean towards to the Democrat camp, Google has been donating more and more to Republican areas, even if they do not agree with the party’s social views—“business is business” said one Republican consultant. All told, the tech industry has donated over $22m this year to political campaigns, but that figure does not count the sometimes lofty private donations of those working in the industry, like the $500k donated by Eric Schmidt, Google’s executive chairman. Republican congressman Bob Goodlatte, Florida Senator Marco Rubio, and democratic contender for congress Rohit Kanna, have all been major beneficiaries.


FINSUM: The tech industry has undergone a major transformation over the past five years, morphing from a near “hippyish” persona—remember big tech founders speaking out against the moral bankruptcy of the financial industry—to one of big business and corporatism. The public’s pushback is already underway in San Francisco, and it will be interesting to see if it spreads in the US. Tech hatred is thriving in Europe.

(Brussels)

The EU appears to backtracking about as fast as it can from one of the critical elements of the ongoing US-EU trade talks. So-called “arbitrations” or mechanisms where corporations can engage in legal proceedings without getting tied up in national courts, are proving to be a major roadblock on the EU’s side. The mechanisms, which the EU already uses in hundreds of bilateral trade agreements, most recently in its trade deal with Canada, are becoming politically toxic across the EU, as EU residents become fervently opposed to US corporate activity in Europe. The EU’s new trade chief, Cecilia Malmstrom, has said that “arbitrations” may be left entirely out of the trade agreement, but that she could not say anything more concrete, other than their current status needs to be changed. “It is indeed a very toxic issue in this parliament and elsewhere,” said Malmstrom. If arbitrations were to be left out of the trade talks, it would prove a major blow to the whole effort, as it would essentially leave the finance industry entirely out of the agreement. The US said it was committed to including the arbitrations, which can effectively be described as investor protections.


FINSUM: Anti-US corporatism is running rampant in Europe on the back of the spying scandal and the actions of companies like Uber, Apple, and Google. The spite held on the European side of the Atlantic threatens to dissolve the whole effort as European politicians have to save face and give in to populism.

(Moscow)

The Kremlin is extending its control of Russia, this time using tactics reminiscent of the old Soviet era. Moscow announced yesterday sweeping new changes to the media industry, saying that foreign ownership of media companies could be no more than 20%. In doing so, the government will force several popular journalistic outlets to either close or sell. The bill to change the rules passed through Russia’s congress by a vote of 434-1, as lawmakers believe the west is using media companies to launch a propaganda offensive within Russia against the government. Vedomosti, the Russian edition of Forbes, will be one of the largest businesses hit, along with dozens of other newspapers and magazines. Forbes has been highly critical of the Russian government and oligarchy, and was successfully sued by Igor Sechin, Rosneft’s CEO, last year, after the magazine published an unflattering article about his high pay and inappropriate power in the government.


FINSUM: This move is tantamount to another round of sanctions, and it is interesting to see how, in contrast to the west, when Russia imposes new rules it also slowly tightens the vice on its own people. Russia is digging in for a long-term standoff with the US and Europe.

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