The AI Industry Is Spending Big on the US Midterms w/ Molly White

Last time it was the crypto industry; now the AI industry is stepping up to join it. Molly White joins Paris Marx to discuss how the tech sector is spending big to buy influence in the US midterm elections to ensure new laws serve its interests over those of the public.

Molly White is the creator of Tech Influence Watch and Web3 is Going Just Great. She writes the Citation Needed newsletter.

The podcast is made in partnership with The Nation. Production is by Kyla Hewson. Support the show on Patreon.

Also mentioned in this episode:

• You can now pre-order Paris’s new book Hyperscale.
• Molly just wrote about Trump’s $1.4 billion crypto disclosure.
• Molly wrote about the crypto industry’s recent election spending.
• Molly also wrote about how the Citizens United decision is affecting elections today.

Transcript

SPEAKER_01 0:00

You know, if Elon Musk has $10 million to give to somebody, how does someone who lives in Kentucky, you know, who makes a normal living wage make themselves as important in the eyes of their elected officials, you know, when there's that kind of corporate spending happening? And so I think that, you know, it's a really alarming trend, but also a fairly predictable one.

SPEAKER_00 0:44

Molly is the creator of Tech Influence Watch, and Web3 is going just great. And she also writes the Citation Needed newsletter. Now, you might remember back in the last US election cycle, crypto money played a really big part in shaping a lot of key races across the United States as the cryptocurrency industry basically trying to buy support for supportive legislation, you know, legislation that would let them do the types of things that they wanted to do and not risk, you know, regulatory oversight and those sorts of things. As the US heads into its midterm elections in November, is gearing up to be very similar, except now it's not just the crypto industry trying to gain influence. It's also the AI and data center industry. That's probably not a surprise. You know, AI and data centers have become a much bigger issue over the past few years. And certainly they are facing greater public pushback. They're facing greater efforts at regulation, and they want to make sure that they can do whatever it is that they want to do, right? And the way to do that is to make sure that you have politicians who are going to be favorable to your interests. Certainly the tech industry felt that it was buying a supporter and a friend in Donald Trump when he returned to the White House. Um, and certainly that is part of the reason why we had the billionaires lining up behind him at the inauguration, but also why they donated millions and millions of dollars to his campaign, to his inauguration fund, and certainly have been helping him make more money through other means as his presidency has continued. Uh well, you know, some people are happy with what they have gotten. Other people in the tech industry, I would say, were hoping to get a bit more than they have. And so certainly as the AI industry now seeks to become a major player like the crypto industry was last time around, and certainly the crypto industry hasn't gone anywhere, they are really fighting to ensure that they are going to get regulation that is favorable to their interests from this next Congress. And so I think this is going to be something that we're going to have to watch in the coming months to see how this is going to play out, to see how these US companies try to flex their financial muscles and certainly to show their influence in the election that is coming as they try to get politicians on their side, even if the publics are, you know, not so supportive of what these companies would want. So I think this is a really fascinating conversation. And certainly Molly has been following this very closely. So she is a great guest to have on to dig into all of this with. Just a heads up that Molly's audio might not be as good in the first part of this interview, but if you keep listening, it will get better a little bit later on. Of course, if you do enjoy this conversation, you can share the show on social media or with any friends or colleagues who you think would learn from it. And if you want to support the work that goes into making Tech Won's Save Us every single week so we can keep giving you the information you need to understand how the tech industry is shaping the world around us and our individual lives, you can join supporters like Andrea from Zurich and Warren in New Brunswick, Canada by going to patreon.com slash tech won't save us where you can become a supporter as well. Thanks so much and enjoy this week's conversation. Molly, welcome back to Tech Won't Save Us.

SPEAKER_01 3:58

Thank you for having me.

SPEAKER_00 3:59

Absolutely. It's always a pleasure to talk to you. You know, I feel like you have been really shaping a lot of these discussions around the crypto industry and now, you know, looking into uh what the tech industry is doing with elections funding. Of course, you know, you were tracking the crypto elections funding the last election cycle, and now that has that has broadened out, right? Uh in a in a quite a significant way. And so, you know, I guess as a broad question, uh, you know, as we get into this conversation, what are we seeing in the run-up to the midterm elections that'll that'll be happening in the United States in November with regards to how the tech industry is planning to or already beginning to try to influence uh the elections that are going to be happening at that time?

SPEAKER_01 4:41

Yeah, so what we're seeing this cycle is fairly similar to what we saw in 2024, which was massive industry spending out of the cryptocurrency industry. Um, but this cycle, we're also seeing the crypto industry joined by other tech interests, most notably the artificial intelligence industry, which has been essentially emulating the cryptocurrency industry playbook in the way that they've designed their super PACs and the strategies that these PACs are exhibiting. Um, but it's introducing even more money uh from tech interests into what is a midterm election. I mean, typically a lower spending election when you compare to the, you know, on-year elections. The industries together have already spent $120 million on the midterms, and we're not even all the way through the primaries yet. And you can compare that to 2024 when the cryptocurrency industry spent $130 million overall in that entire election cycle. So we're almost at that point now of you know meeting what the industries were spending in 2024. And I think we are well on the way to surpassing those numbers this time around. Now, obviously, that brings in an additional industry, but even looking just at crypto, they've already spent $73 million on elections this time around. So significant amount of money going towards furthering their interests. And as I mentioned, uh it's been vastly amplified by new tech interests entering the game.

SPEAKER_00 6:13

That's both fascinating, but also, I guess, quite concerning, right? And it probably speaks to how I imagine they saw the influence that they carried out in the last election cycle, right? Like, you know, if that was a major presidential election and you had all of these kind of elections happening at the same time, you know, it's it's the main part of the election cycle, I guess, versus the midterms that are happening now. And to see the spending already, you know, reaching and eclipsing the levels that you know were experienced in that in that kind of main time, that must tell you, I guess, that you know, they were pretty happy with what they got, I guess.

SPEAKER_01 6:49

I think so. I I think that they have seen success from their spending, but I think it's a dual issue here. I think that we're seeing one, they they did have success in 2024. They were able to elect Donald Trump, obviously. They installed multiple pro-crypto senators, over a dozen pro-crypto representatives in the House of Representatives, and that's paid dividends. I mean, the the legislative stance in the US is very different, and certainly the regulatory stance is very different toward the crypto industry in a very positive way for that industry, where you know the SEC has essentially backed off crypto regulation, the CFTC is on its way to becoming the primary crypto regulator, which is something the industry has always wanted, and you know, various other regulatory wins. So I think that that was, you know, a success for the crypto industry that they would like to repeat going forward. But I also think that a lot of the spending comes from fear out of the industry that the work is not done. They wanted to see more, I think, in the first two years of Trump's presidency, especially while Republicans controlled all branches of government. And I think there is this serious concern out of the crypto industry that the midterms could swing things in a different direction. You know, we could see Democrats taking control of the House, for example, making it more challenging to pass some of the legislation that they wished had already passed. For example, the Clarity Act is the crypto market structure bill that the industry has been pushing for. It is essentially written by the industry. Um, and when portions of it were not to the industry's liking, they sort of threw a tantrum and, you know, sort of blocked the bill, which is partly why it hasn't passed yet. And so now the sector is very concerned that, you know, if we don't contain or continue this pattern of electing pro-crypto congress people, we may not be able to get this bill signed into law. Um, there's actually a huge push to try to get the bill through before the midterms because I think that concern is so strong that you know we need to do this now because after the midterms it's not going to pass. And, you know, there's been an immense amount of talk out of the industry reflecting this fear that the wins that they have enjoyed to date could be temporary. So now a lot of the talk has shifted to cementing these regulatory changes into law so that in the future, if there is a less friendly administration, if the balance of power shifts, they're not going to see all of those things immediately rolled back, which I think is, you know, it keeps them up at night.

SPEAKER_00 9:29

Yeah, definitely. And I feel like I've been seeing some reporting recently kind of on like how the industry is feeling about the Trump kind of regulatory approach or or you know what has Trump, what Trump has done on the tech side of things with regard to regulation. And like you say, I feel like there are there is certainly a feeling that they got some wins out of it, but not nearly as much as they were hoping to get. And you know, maybe the crypto industry broadly is a bit happier with what it got, but it feels like the AI industry increasingly is a bit worried with some of the regulatory stances that the the Trump administration is taking. And I guess that also helps to explain them why they're trying to seek so much influence um in this coming election.

SPEAKER_01 10:10

Absolutely. I think that's 100% right. And, you know, the the AI industry did not have the type of influence that the crypto industry did in 2024. And I think seeing the crypto industry's successes, they were like, of course we should do this. You know, it's just a wise investment, essentially, to put a couple hundred million dollars into elections, which, you know, looking at their operating costs, that's the drop in the bucket compared to you know what they're paying for other things. So yeah, I mean, I think, you know, as these industries become more willing to just exploit the effects of Citizens United and really just pour money into elections, we're gonna see more and more industries following that playbook in and outside of the tech sector. Certainly it's it's no new invention that uh industries have spent heavily on campaign finance. I mean, everyone knows big oil, big pharma, the NRA, you know, huge lobbying interests. But this new push from the tech sector, I think, is is new and one that we'll see more of going forward.

SPEAKER_00 11:14

Yeah, I definitely agree. And I was wondering, you know, before we really get into our talk about the midterms, can you give us a refresher on how the playbook of the crypto industry worked in the last election cycle?

SPEAKER_01 11:25

Yeah, so the crypto industry has this sort of multi-pronged strategy uh that they have used in 2024 and that they're using again this cycle. One aspect of it is sort of a PR campaign, uh, and it's directed at not only the general public, but at candidates and elected officials who might be seeking re-election. And it really tries to push home this idea that Americans love crypto, that everyday voters hold crypto, trade crypto, and not only that, they want the same regulations that the crypto industry wants. And that that's something that will impact their decisions at the ballot box. It's something that they are demanding of their elected officials. And so, you know, this has been a challenging line for the crypto industry, largely because it's not backed by much evidence, but they have, you know, commissioned their own polls or just sort of invented numbers out of plain air to try to drive this home and then use that to try to convince candidates that, like, hey, you need to be making this a part of your campaign to bring in these voters. And they often will point to uh this idea that, you know, this is how you could attract young voters or voters of color. You know, they they sort of claim that these are interests that might appeal to sectors that those candidates might already be trying to win over. Then there's the prong of opposition spending. And this is something that we see primarily in the primary elections, where they will spend heavily against candidates that they deem to be anti-crypto. Now, whether or not those candidates have actually said much about the crypto industry differs. Um in many cases, they select candidates who have not been particularly outspoken about crypto, but that they can paint as enemies of the industry. So a good example of this in 2024 was Katie Porter in California, who was not particularly outspoken about crypto, but had advocated for consumer protections, had stood up to the big banks, she was seen as an ally of Elizabeth Warren, who has been a strong uh critic of the crypto industry. And so, because of that, she was sort of enemy number one in the midterms for the crypto industry. And they spent $10 million to oppose her, and ultimately she did lose her primary election. And we saw similar campaigns against Jamal Bowman and Corey Bush, who similar stories. You know, they were not, crypto was not a big part of their platform, but they were deemed to be enemies of the industry and defeated in the primaries. And, you know, I think that the the real selection process is that they were already facing challenging primaries to begin with. There were controversies in those elections that were nothing to do with crypto. Um, there was heavy spending in some of these elections from other interests that were opposed to those candidates that the crypto industry sort of joined in with. And so, you know, ultimately they were able to notch those wins against those candidates and then use them as sort of a hammer with which to threaten other candidates and say, look, if you take up the mantle, you know, against crypto, or if you talk too much about consumer protections, or if you say anything that's too aligned with someone that we think is an enemy of the industry, we can do the same thing to you. We can take our tens of millions of dollars, parachute into your campaign. You know, often these were elections where there wasn't that much spending to begin with, and so $10 million, you know, can make a huge difference. And, you know, it essentially frightened candidates away from making any statements on that or taking strong positions. And then finally, the third prong was the pro-candidate spending. This was offering support to candidates who emerged as strong allies to the industry, especially in races where they might be challenging someone who was more of an opponent. So the biggest example in 2024 was in Ohio, where Bernie Marino was challenging uh incumbent Democrat Sherrod Brown, who was on the banking committee, very strong, outspoken critic of the crypto industry. They spent $40 million to unseat Brown and install Bernie Marino, and I would say that has paid off handsomely because he is now on the Senate Banking Committee and advocating for crypto in Congress. But, you know, it's a similar thing where it was like if you put something on your website saying you love blockchains and you support innovation and you know you want clear rules of the road and all of these sort of buzzwords that signal to the crypto industry that you are on board, then there's a couple million dollars, tens of millions of dollars for your campaign. And that I think is largely what we've seen this same this time around as well, is you know, the attempt at public perception, you know, shaping this idea that Americans love crypto, threatening opponents of the industry with heavy, heavy opposition spending, and then obviously supporting candidates who are deemed to be allies to the industry.

SPEAKER_00 16:26

Yeah, that that that's really fascinating to hear, right? You know, the many different aspects of the strategy and how that actually worked out to you know expand the influence of the crypto industry, an industry that I would say most people associate it with, you know, scams, people losing money. You know, as you're saying, most Americans are not using, most people around the world are not using, but this industry really wants people to believe that, you know, this is the future, right? And they're willing to spend big to try to make that to be the case. Um, to what degree, you know, uh I've talked to Jacob Silverman about this on the podcast before, probably to you as well. Um, but obviously the Trump family has also been very involved in crypto. To what degree is that something where like they received money from the crypto industry and saw that they should get involved here, or just saw that it was a really good opportunity for a grift, or do we have a good idea of you know what angle they took there?

SPEAKER_01 17:18

Yeah, well, I mean it's hard to read their minds, and I don't think I would want to, but to me, it seems to be a bit of a mix of everything. So I do think that it was very aligned with Trump's previous business ventures selling Trump Bibles and Trump perfumes and sneakers and stakes and you know everything he could put his name on. Why not do NFTs? Why not do meme coin? You know, it it absolutely slots into that pattern quite nicely. He didn't even have to deliver any product at the end of the day.

SPEAKER_00 17:48

Um, and so I know you're personally a very heavy user of the the Trump mobile phone, uh of course, right? Yes, clearly.

SPEAKER_01 17:56

Yes, I needed a gold uh phone, and that was the one I could find. But yeah, I mean, so I think that that was a part of it is you know, easy cash grab. And that was what we were seeing with some of the earliest Trump family projects. They got into NFTs, Melania first, then Trump himself in like 2022. I mean, this was even before his most recent foray into the crypto world. But I think more recently he discovered that there's a lot of money to be made when you personally run businesses in a sector that you are in charge of regulating. And you know, he has been able to make billions of dollars through his cryptocurrency ventures in ways that would have been illegal under previous administrations. So, for example, um the World Liberty Financial Crypto Platform, which was co-founded by Trump and his sons along with a couple of others, issues a token called WLFI. And that token is pretty plainly a security under the previous administration's definition and sort of the long-standing definition of a security. And yet Trump has been able to sell this to everyday people as well as billionaires who were sort of early buyers of this token and earn hundreds of millions of dollars personally from these token sales. And it is largely thanks to his election that they are not facing any consequences from the Securities and Exchange Commission, which has completely reversed course on their position that cryptocurrencies are securities, have essentially said, just kidding, you know, we were wrong. The previous SEC was too aggressive. We don't think they're securities at all. And so we're not gonna go after companies that are selling them as such. Um they've dropped over a dozen enforcement actions against companies issuing the very same type of token. Um, and you know, Trump has made hundreds of millions, billions of dollars off of his crypto ventures. And so I think that it's sort of a mix of things. I also think that the crypto sector is very willing to pay for play. We have seen multiple business deals in the crypto world where it is plainly clear that these companies are willing to pour money into either Trump's campaign or into Trump family businesses in exchange for favorable treatment, whether it's legislation being passed that advances their interests, regulatory relief from these enforcement cases that they were facing, you know, various different things. And that has been enormously lucrative to Trump.

SPEAKER_00 20:35

It's been fascinating to see like what Trump and his family have done, right, to benefit from the crypto industry and the amount of money that they have extracted from it, as you've been saying. But but I wanted to go back to something that you were saying before as well, right? Around kind of the strategy of the crypto industry the last time around. When we look at the AI industry playbook in this cycle, is it really kind of echoing, mimicking exactly what they were doing back then, or are there notable differences in the strategy that the AI industry is pursuing right now?

SPEAKER_01 21:05

I would say there are noticeable similarities and noticeable differences. So, you know, one of the biggest similarities is we've seen super PAC networks emerging out of AI that look exactly like the structures that we've seen in the crypto world. So, for example, in crypto, the biggest pro-crypto super PAC is called Fair Shake. It has two affiliated PACs, one that is focused on Democrats and one that is focused on Republicans. And it sort of funnels money through those arms to sort of obscure the spending a little bit, and I think make it a little bit more palatable to donors that might be either very pro MAGA or, you know, might be more on the democratic end of things. And that's a very similar structure to what we've seen on the Leading the Future network, which is one of the major AI networks funded by Andreas Nhorowitz, which is also a major backer of Fair Shake. And, you know. These two super PACs, they share funders. They also share uh leadership to some extent. So some of the same people who created the Fair Shake pack are involved with the Leading the Future Pack. They're the Leading the Future Pack is headed by a longtime spokesperson for Fair Shake. And so, you know, it's kind of the same group of people there. And the spending is, I think, following a fairly similar strategy where we saw strong opposition spending out of the Leading the Future Network in New York's uh 12th district, where Alex Boris was running for election. He was deemed as a threat to Leading the Future Network's goals. You know, I think they wanted to make an example out of him in very similar ways we saw with Katie Porter and the crypto sector. But we've also seen some differences in the AI corporate spending. One of the major ones is that there is not as much agreement among AI companies about how to pursue AI legislation. So in the crypto world, there's disagreements on some policies. There's certainly disagreements on the extent to which these networks should be backing Democrats. There was a little bit of uh defection into this uh election cycle where we saw new PACs formed that were more explicitly pro-MAGA, for example. But we don't really see these PACs spending against each other. That's been different in the AI world, where there has been this explosion in AI packs that are explicitly opposed to the Leading the Future network. The biggest one is a network called Public First, which is, as far as we know, primarily funded by Anthropic, which is the developer of the Claude uh suite of artificial intelligence tools. And they have been actively spending against leading the future. So in that same race where Leading the Future was spending over $10 million to oppose Alex Boris, Public First came in and spent millions of dollars to support him. And there were other super PACs that sort of emerged with similar goals, but slightly less backing. One of them was oddly enough, sort of led by a crypto executive, Chris Larson, who runs the Ripple cryptocurrency business and has become fairly active in AI campaign uh spending and just sort of those issues. Uh his super PAC emerged to support Boris, as did another super PAC that was that says it's funded essentially by AI industry workers and you know claims to represent their interests. And so that's a very different dynamic. There is no sort of anti-crypto super PAC or you know, crypto super PAC that is anti-fair shake. Uh that never happened in the crypto sector. And it's a it's a new dynamic within AI.

SPEAKER_00 25:00

That's really interesting to hear. And I have a couple of questions based on that. The first is more around the kind of crypto AI split. So I guess what we're seeing is that the the crypto industry has its own packs and the AI industry has its own packs. Even if there's like kind of people who are in common or funders who are in common, they're represented distinctly. Is that often the case?

SPEAKER_01 25:21

Yes, I would say that's accurate. So, you know, for example, Andreessen Horowitz has this election cycle split its funding between Fair Shake and leading the future, rather than say, trying to shift Fair Shake into advocating for pro-AI interests alongside crypto interests. Um, it's more of a separation of concerns. And I think it also helps to avoid, you know, if there's backlash against one of these packs, maybe it'll only affect that pack and not, you know, their crypto goals or vice versa. Um and we have seen some backlash. So I mean, I do think that that strategy is uh understandable to some extent. I also think that there is some diversity in candidates when it comes to their stances on these different topics. You know, many of the candidates who have enjoyed support from the pro-AI packs have not enjoyed support from the pro-crypto packs, for example. Um, I don't think they have seen any races yet where you know crypto is spending against a candidate and pro and AI is spending for them or the other way around. Um, but it's often different races that these packs are prioritizing.

SPEAKER_00 26:33

Right. That that makes a lot of sense. Still interesting to hear. And then on the AI side side of things, you know, as you were talking about, is the kind of pack or or is kind of the money that is going against, say, the open AI and Andreessen money, is that pretty much all from anthropic and say like the AI workers, or is that kind of coming from a more broad uh cross-section of uh funders?

SPEAKER_01 26:59

Well, it's a little hard to tell because the AI sector has been more heavily using dark money groups. Certainly they're active in crypto as well, but a lot of the spending that is backing public first, for example, is coming through 501c4s and they don't have to disclose their donors. So, you know, if the 501 contributes to the super PAC, you see the contribution from the C4, but you can't see who was funding the C4. Um, the only reason that we know that Anthropic is so behind the public first network is because they've claimed responsibility for it. You know, they've explained that, hey, we put $20 million into this. They didn't have to do that. They could have left it, you know, secret. They ultimately decided to do so for reasons we can't exactly know. But it means that, you know, the other funders of that C4 who have not chosen to come forward are largely unknown at this point. There are backers of these super PACs that are known. You know, they've contributed directly to the PACs, or even, for example, in Chris Larson's case, set up their own PACs. But in terms of overall numbers, they are less significant contributors to the AI PAC spending than Anthropic, OpenAI, uh Andreessen Horowitz, for example.

SPEAKER_00 28:16

What does that then say about, say, like the narrative of these AI companies? Because you know, I know Anthropic is trying to present itself as you know, kind of set apart from the open AIs in particular and their approaches. Um, but then there has been cr some criticism of the way that Anthropic has tried to do that, right? You know, it's very focused on this kind of AI safety existential risk perspective, um, but is still very actively working with militaries and and things like that in order to supply them with technology. Um, so yeah, what do you think about their kind of you know opposition of like the open AI and recent money? What does that tell us about the narrative in the AI industry or what these companies are pushing for?

SPEAKER_01 28:57

Well, it's it's a little bit complicated. I mean, I, you know, the there is this perception that Anthropic is pushing for more regulation, they're pushing for AI safety. And, you know, I think that perception largely comes from their own advertising because I think that, you know, that perception that, oh, they're the safe ones. They don't want humanity to go up and smoke because of AI. You know, they want safe, friendly AI. That's very beneficial to the company. You know, and as you say, they're still, you know, signing deals with the government. They're still helping with programs that are very concerning from a public safety or public interest standpoint. But, you know, this spending has been another way that they've been able to portray them as sort of the protectors of the public interest. And of course, vilify open AI and competitors as being, you know, anti-regulation. They just want to, you know, take the brakes off and develop dangerous AI or whatever it might be. And, you know, that's a beneficial framing to them. Um, but, you know, open AI, of course, is would would take a very different view of their spending. They they take sort of the crypto industry line, which is that we can't over-regulate this industry. It will stifle innovation. There's sort of this nationalist portion of it that, you know, America needs to lead in artificial intelligence development, and we can't fall back, you know, and and behind our enemies like China. You know, there's sort of that end of things, and that, you know, regulation will cause that to happen. And so, you know, it's a national security concern. That tends to be the line that you hear from OpenAI. Now, I don't think either of them is an honest accounting of their goals. I think that both of them, broadly speaking, want regulations that benefit their companies. OpenAI, of course, doesn't want to be blocked in the models that it's developing and releasing. Um, they want sort of, you know, this open road to develop any type of um systems that they want. They don't want any, you know, liability. They don't want states stepping in to try to introduce safety frameworks or um guardrails around these models, for example. That's been sort of one of their biggest pushes is to sort of get the states out of the mix when it comes to regulating AI. But, you know, you could make the same argument for the anthropic packs, that they're just trying to bolster their bottom line. And by pushing for AI safety, the company that has structured itself as this safe AI company will, of course, reap the benefits. And it will, you know, it will hamstring the open AIs of the world and the other competitors that Anthropic is is facing off against. I don't think that any of these super PACs is truly a public interest super PAC. There is no sort of consumer protection super PAC. There is no, you know, making sure that AI is not uh increasing surveillance super PAC. You know, there's certainly they will draw on some of those talking points when it's convenient to them. But if it you know threatens their business interests, it's not something they will pursue. And so I think that, you know, a lot of the goals of these super PACs are as much about PR as they are about any legislative agenda.

SPEAKER_00 32:21

Well, where's the billionaire to fund fund the good packs? You know, uh no, but I can I completely take what you're saying, right? And and just on your point around anthropic, like I saw some numbers recently. Uh, you know, I'm sure people saw the stories about their valuation kind of overtaking open AIs, and that, you know, their kind of customer base has really started to soar in the past number of months. Again, in in large part because of this narrative and this framing that you that you were talking about, right? And how they're positioning themselves in opposition to so many of these other AI companies.

SPEAKER_01 32:53

Right. And it's you know, it's kind of wild to watch their strategy there where you know they were able to portray themselves as you know standing up against the US government when it came to um, you know, they them being declared a supply chain risk and all of that drama. And then, you know, simultaneously being actively used by the US government. There are you know, active contracts, they're certainly hoping to continue that and even expand that. But you know, I think it was a great PR move for them because, you know, as we've seen, they've they've increased their their customer base. I think in part because people were like, oh yeah, you know, I want to support the guy who's standing up to the government and who's you know uh not just going along with everything the government wants them to do as far as you know, drones and all that kind of thing. And it's like, well, neither of these companies is standing up to that.

SPEAKER_00 33:46

No, it's it's definitely the case, what you're saying, right? And and it has just been fascinating to watch how this company has so successfully kind of you know positioned this narrative, right, that that so many people have adopted. But I wonder, you know, we're talking a lot about AI, and we know there's a growing kind of public opposition to AI. Is the data center industry also getting involved here? Because we're seeing a lot more public opposition to these projects and data centers being canceled. Are they getting in on this spending too and trying to influence races?

SPEAKER_01 34:13

To some extent they are. Um I would say that the spending from dedicated data center companies is fairly minimal. It exists, but it's fairly minimal. Um, there's certainly some overlap with the crypto spending there because we've seen a lot of you know Bitcoin mining operations pivot into AI data centers. But you know, they're sort of smaller potatoes when they when you compare them to open AI, you know, Anthropic. And a lot of these big tech companies, whether it's the open AIs and anthropics or the Microsoft's Oracle's Amazons, they have their own data center operations, but are not necessarily a data center company. You know, you don't think of Microsoft as being specifically a data center company, for example. But they are certainly involved in the campaign spending. It's, I think, becoming more and more of a campaign issue where even the voting public is aware of it. They see it more as an issue. Um, there's been more local resistance to data centers. Um, and you know, simultaneously, we're seeing these super PACs trying to push back against the ability for these communities to, you know, establish data center moratoriums. So definitely both an issue in terms of the companies that are participating in the spending and the issues that are coming up on the campaign trail.

SPEAKER_00 35:34

Does this potentially create some issues for the candidates? Like I know last time around, obviously, you know, you the public was not in favor of crypto, but you had this industry backing a lot of candidates that were in favor of crypto and seem to feel that they needed to be vocally in favor, right, in order to get this money. You know, as we head into this cycle, does it create issues where you clearly have the industry backing candidates who are going to be pro-crypto, pro-AI, pro-data centers, but we see the public is increasingly against those things. Like what divisions come up there?

SPEAKER_01 36:07

Yeah, I think that there is a lot more uh complexity when it comes to navigating that tightrope for candidates than there was with crypto. Because, you know, there are certainly were people who balked at candidates who were talking about blockchain and innovation and all that kind of stuff. But it wasn't a major issue for a lot of voters who were just focused on other things. And like, sure, there's that weird section of his website that says stuff about blockchain, but like I'm more interested in what he's gonna do for the economy or immigration or, you know, whatever it might be. That's different in the AI world because I think AI issues are more galvanizing for everyday people, especially if they're in communities that are being affected by these things, you know, day to day. If there's a data center being proposed next door, you know, that's something that really gets people up in arms. And it's something that can become a campaign issue. I mean, I think that's what we saw very clearly in New York 12 is that a race that was not necessarily focused on AI became very focused on AI when all of this uh AI spending entered the picture. And, you know, it was not something that was being talked about heavily until Leading the Future came in and spent, you know, 10 plus million dollars against Alex Boris. And then suddenly there were actually ads talking about AI. Uh his campaign became very focused on AI regulation. And, you know, he was really presenting himself as the candidate that you should vote for if you want to stand in the way of these big AI companies who are trying to get their way. And I think that was actually some significant backlash. I think that, you know, we saw OpenAI trying to distance itself from the Leading the Future pack. They've repeatedly tried to claim that they don't fund Leading the Future and that they have no, you know, ties to it. And they're sort of doing this through a technicality in that the funding for leading the future is going via Greg Brockman and his wife, who are, you know, that's the president of OpenAI. And so it's a little bit wild to try to claim that that's not open AI money, but that's the that's the the um technicality that they're sticking to.

SPEAKER_00 38:17

It's just his personal views, not the views of open AI. Right, of course.

SPEAKER_01 38:21

He just cares personally very much about AI and it has no connection to his company. But yeah, I mean, I think that you know, that backlash was significant and that, you know, even though Leading the Future technically secured the victory there in that Boris was not chosen as the Democratic candidate, it was a closer win than they wanted it to be. You know, and it and the candidate who was elected actually has fairly similar, or who was nominated, you know, became the Democratic nominee, has fairly similar views on AI regulation. He's it's not, he's not as well known for it as Boris was, and it it was not sort of the major focus of his campaign, although it became much more of a focus of his campaign thanks to this spending. And so I think that, you know, we might be seeing a point here where the AI super PACs take a step back and reevaluate a little bit. Is this something we actually want to bring to the forefront of these campaigns where there are communities who do care very deeply about this stuff? And, you know, unlike the crypto sector where they're trying to claim that, oh, Americans love crypto, you don't really see these pro AI super PACs coming out and being like, Americans love AI data centers in their neighborhoods. And, you know, it's it's a harder argument to make on that point.

SPEAKER_00 39:36

Yeah, they're they're all just begging for more AI data centers to be to be in their backyard. Exactly. I I find that really interesting, though, right? Because you know, you're saying it's affected this particular race in New York where where there was a lot of spending. We've seen that in other states as well, you know, in the past couple of years where it has affected governors' races, school board races, like regular legislative elections. And, you know, it's not a surprise to think that this is going to affect the midterm elections as we get closer to it as well. Are there other races where you're seeing that they're really kind of targeting and and you know, uh spending a lot of money?

SPEAKER_01 40:12

New York 12 was certainly the vast uh you know front runner of that spending. And I think it was maybe kind of the guinea pig for the AI industry's, you know, introduction into these races. Alex Boris made himself a fairly attractive target because he had pushed for uh state level regulation of these AI data centers and AI companies in general, not just data centers. And so I think that he was sort of the obvious choice. There haven't been that many candidates who have been as outspoken, although I do wonder if it's something that will actually cause candidates to become more outspoken about it, seeing that it actually really elevated Boris's profile in a race where he was not sort of a name, you know, a household name. And so, you know, our candidate is gonna make it more of their focus. But no, I wouldn't say there has been spending that has um has really rivaled that race. There's been some spending in, you know, other races, but nothing to that degree.

SPEAKER_00 41:15

Yeah, that makes sense. And, you know, we're still a few months out at this point as well, right? I'm sure things are gonna start ramping up in the next few months.

SPEAKER_01 41:22

And also at this point, we're just talking about primaries. And so there's really no head-to-head, you know, general election races that are, you know, well underway. I mean, certainly that some of those, some of that campaigning is is beginning and we're starting to see spending in general elections as well. But for the most part, these super PACs have been really focused on primaries and seem to be waiting for the primary season to end before they get too involved in the general election.

SPEAKER_00 41:50

Right. Yeah, that that makes sense too, right? And and as that starts to pick up, then I'm sure we'll start to see a lot more of where they start to put their money, you know, the candidates that they're focusing on. You mentioned earlier the the difference between the Republican side and the and the Democratic side. I feel like during the last cycle, we saw a number of Democrats trying to position themselves as being pro-crypto in order to benefit from, you know, from the money from the industry, from the support from the industry. Are we seeing much of that on the AI side this time around with like Democrats being openly pro-AI in order to court the industry? Or is this proving to be more of a divide? And are Republicans like necessarily pro-AI? Because I've seen a certain amount of polling suggesting that Republican voters are actually very opposed to data centers. So yeah, I wonder what you're seeing there.

SPEAKER_01 42:38

Yeah, so it's actually been interesting to track the breakdown in spending by industry, by party, essentially. So we saw in 2024 crypto spending was leaning Republican, although, as you mentioned, there was Democratic spending as well. I think the crypto industry has acknowledged that, you know, even with every single Republican on board, they still need Democrats to get their legislation passed. And so they are really courting Democrats. Um, and you know, I think that is continuing into this cycle as well. But, you know, their spending continues to lean Republican, although it's, you know, almost an even split. That is actually not the case for AI spending, which is actually leaning Democratic. And it's a little hard to say to what extent that will continue into the general election when we're seeing Republicans versus Democrats. But it does seem that the AI industry has been actively spending in Democratic primaries more frequently than they're getting involved in Republican primaries. And so, for example, Alex Boris, that was Democrats versus Democrats. And, you know, they were really trying to secure that Democratic seat. And so a lot of spending went into that. We'll see, I guess, where it goes once we're into the general and things break down a little bit more across parties. But it does seem like there is this push by the AI sector to get democratic. Democrats on board. And I think you're right that it is partly because AI is less of a strictly partisan issue compared to crypto. You know, in the crypto worlds, pretty much every Republican is on board with the crypto agenda. There's occasionally defections, but you know, it's it's a pretty common standpoint. And with the Democrats, it's a little bit uh less common for Democrats to support the crypto playbook. Again, there are pro-crypto Democrats that have tried to sort of bridge that divide. But generally speaking, when we're seeing votes on these issues, it's fairly split by party. I think with AI, it's it's very different. I think that there are Republicans who are concerned about AI. There are Republicans that have concerns about these big tech companies. I mean, big tech has always been sort of a focus of uh Republicans, although, you know, how they choose to interpret that is sometimes a little bit convenient.

SPEAKER_00 44:56

They really just don't want to be silenced on social media, right?

SPEAKER_01 45:01

And so, you know, I think that that has really impacted the spending as well, in that, you know, a lot of the people that they're really pushing for are on the democratic end of things. Um, and you know, they're they're looking to put those people into office.

SPEAKER_00 45:16

I I would imagine part of the kind of calculus there as well is I guess last cycle it felt really kind of head-to-head, right? Between Republicans and Democrats, you know, in the presidential and things like that, right? Who was going to win kind of a thing? It feels like this time around, the vibe is much more like it feels like the Democrats are likely gonna pick some stuff up. And so maybe it's like we try to make sure that the Democrat who makes it through the primary is more friendly to us because they might have a better chance of like picking up more of these seats than the Republicans would. Do you think that's playing into it too?

SPEAKER_01 45:51

I think that's true. Although I think that is a factor in every election. I think we've seen multiple instances in 2024 and in this cycle where, you know, it's probably not the candidate that crypto dreamed of or that AI dreamed of, but it's better than the alternative. And I think that is definitely, you know, that sort of practical approach is coming into play in a number of these elections as well, where it's like, they probably don't want that person, but you know, it's better than this person that they think would be an outspoken opponent or, you know, even just someone who would pay attention to it, right? Because a lot of people still are campaigning on everyday issues that are not to do with AI, not to do with crypto. And sometimes that kind of a candidate is the better choice than someone who, you know, is going to come out and try to push for strong regulation or whatever it might be.

SPEAKER_00 46:47

Yeah, like you were saying in New York, right? Let's get the kind of mildly anti-AI person versus the vocally uh anti-AI person. It's a bit better for us. Maybe can be moved a little bit too, right? Like, you know, you were talking earlier about the players involved, right? You know, obviously we have Sam Altman who's with OpenAI, Dario Amade with um with Anthropic. You mentioned Greg Brockman, who's at OpenAI as well, of course, Mark Andreessen, who has become influential in the Trump White House and, you know, has been very kind of um vocally outspoken on right-wing political issues. Um, are we seeing any other major tech players involved in this cycle, you know, trying to influence with money or otherwise? Um, and is Elon Musk going to be as big of a player this time around as he was last time with the money that he deployed?

SPEAKER_01 47:39

Yeah, um, I think those are the big players when it comes to the AI end of things. You know, Andreessen, OpenAI, Anthropic, those are sort of the heavy hitters there. When it comes to crypto, it's pretty familiar faces. Um, Andreessen, again, has always been very pro-crypto as well and is is contributing to Fair Shake again this cycle. There's Coinbase, which was has always been sort of the leader of the uh crypto political movement, I would say. And then Ripple has always been a pretty big spender. And we're seeing Chris Larson, Ripple's uh CEO, spending not only on crypto interests, but actually in the AI sector as well, even though his personal business interests are not quite as heavily tied to that. So I would say those are the biggest spenders. There are also just sort of individual spenders who have interests in those sectors. So for example, for example, Jeff Yast, who is with Susquehanna, Elon Musk, obviously, who has interests across AI, crypto, tech in general, uh, defense, and et cetera. And, you know, Elon Musk has been active, I would say, um, certainly not as high profile as he was in 2024 when he was, you know, on stage and campaigning for Trump and being very obnoxious about his political spending. Um, I think he kind of took a step back after the feud with Trump and, you know, decided to maybe not make that as big of a his focus. But he has been spending pretty heavily uh on politics continuing into this cycle. So yeah, I think those are sort of the biggest players. Um, there are others that, you know, are sort of around the margins. We've seen Cantor Fitzgerald actually getting pretty involved in the crypto super PAC end of things. Um, that being the financial company that was previously headed by Howard Lutnick, who is now Secretary of Treasury, or not Treasury, um Commerce Secretary. And, you know, there's there was some really interesting uh movement there where it seems to me that he still has some influence that uh over that company and over its political machinations. But, you know, compared to the Andreessons and the open AIs, it's relatively small potatoes.

SPEAKER_00 50:01

Yeah, that that makes sense. And in terms of Musk, like, is his money still leaning Republican? Like, is he still kind of supporting Republican candidates? And are are we expecting to see as much this time around, or is it like much more paired back, or is it still hard to say?

SPEAKER_01 50:16

Um, so yes, his money is still very focused on Republicans. Um, it's not nearly as much money, I think, in part just because there's no presidential election, and that's where he was focusing the majority of his spending last time around. But yeah, I mean, he has, you know, spent $50 million or so uh towards the America PAC, which was the pack that he was using to back Donald Trump. Obviously, Trump has been elected, and so him continuing to put money into that pack does not suggest that it is continuing to go to Trump. Um, but he has been backing people like Nate Morris, uh, who's the Republican Kentucky Senate candidate. Uh, he's been heavily spending uh towards the congressional uh Republican packs and those types of contributions. And yeah, I mean, it's been, I think, exclusively uh contributions to Republicans from Elon Musk.

SPEAKER_00 51:09

Gotcha. And and so it doesn't look specifically focused on AI in his case, or is it hard to say?

SPEAKER_01 51:16

It's hard to say. Um, you know, some of these races are seeing spending from the AI sector, but some of them are also just contentious races where, you know, they want to make sure that the Republican incumbent stays in power, for example. So, you know, looking at the Kentucky Senate election, we've seen spending coming out of the crypto sector and the AI sector to back Morris, or sorry, to back Morris and to back Barr, who eventually um was became, you know, he won the primary after Trump essentially convinced Morris to take a step back. And, you know, whether or not Barr is, you know, the the dream candidate, you know, whether he's the the fighter for crypto, uh, or they just want to make sure that, you know, that seat doesn't flip. I don't know. Um, but I wouldn't say that it's it's clearly because of AI or crypto.

SPEAKER_00 52:06

Yeah, that makes sense. And he, of course, has a lot of other interests as well.

SPEAKER_01 52:10

Exactly. Right.

SPEAKER_00 52:12

Um, you know, in terms of uh, you know, this whole subject, you know, the money that that the tech industry is putting in here, I guess to close off our conversation, um, are there any other important details that we didn't get to that you think it's important for people to know? And I guess where are you seeing this going over the next few months as things kind of kind of ramp up?

SPEAKER_01 52:31

I mean, I think that, you know, to to to address the last part first, I think that we're going to see significant spending continuing into, you know, right up to the end of the midterms. Um, it's not shown any sign of slowing down, even as we're getting through the the last of the primaries. And, you know, it's very clear that both of these industries feel that shaping the legislation is an extremely important business decision. And I think that, you know, even looking past the midterms, this is a trend that is going to continue into future cycles and with potentially who knows which industries who realize that it's actually a business decision to um spend heavily on who ends up making decisions in Congress or in the White House, because you know, that is one of the best ways to advance their interests. And I think that, you know, it's sort of this real example of the outcome of a decision like Citizens United, where year over year we've just seen that spending increase and increase and increase to the point where it's reaching just astronomical levels that we've never seen before. Um, and, you know, simultaneously it is really drowning out the voices of the people that these elected officials are supposed to be representing. Because, you know, if Elon Musk has $10 million to give to somebody, how does, you know, someone who lives in Kentucky, you know, who makes a normal living wage make themselves as important in the eyes of their elected officials, you know, when there's that kind of corporate spending happening. And so I think that, you know, it's a really alarming trend, but also a fairly predictable one and, you know, something that we are going to have to grapple with because it's not just gonna sort of go away on its own. As far as you know, what I think people should know, I think that people should really be paying attention to where money is coming from in the races that you know directly affect them. Um, a lot of these super PACs are really working to stay under the radar. They have names like Leading the Future and Fair Shake, which do not say anything about what that pack is actually trying to do. And, you know, it means that when you see a political ad and at the end of the ad it says this ad was paid for by Fair Shake, that means nothing, right? You can't look at that and you know, just sitting on your couch watching TV, know why someone is paying for that ad. And so looking up, you know, what these packs are doing, who's funding them, what their goals are, and why they're trying to influence the election that affects you, I think is really important. And then taking candidates to task on that and, you know, demanding that they actually represent the values of people in their state, the interests of people who are actually going to be affected by them day to day, rather than these corporations that often have no real nexus in that state. I think that is one of the biggest things that people can do is really just be aware of the spending and push back on it.

SPEAKER_00 55:33

Yeah, I think that's really well said. And like when you look at the names of some of these uh packs like Defend American Jobs, uh one that you know promotes cryptocurrency interests. But if I saw that at the end of an ad, I would be like, oh yeah, that that sounds, that sounds about right. It must be right.

unknown 55:48

Yeah.

SPEAKER_00 55:48

Um I wanted to pick up on your Citizens United point to kind of close us off. And, you know, I I remember reading about kind of legislation in Hawaii recently that was trying to pull back the influence of big money in politics and and of these packs and things like that. You know, I don't know how successful that is going to be. I'm not I'm not well informed on it in in any way. Um but as we see the opposition to these industries and these tech billionaires growing, you know, the kind of public opposition and even anger toward them, is that prompting any more of a conversation around doing something about Citizens United and the influence of all of this, you know, dark money and and the money from these really wealthy people and corporations in American politics?

SPEAKER_01 56:30

It is. I mean, I think it is really bringing to the forefront just how much money is being spent. You know, the more that these industries get involved, the more that they are openly campaigning and, you know, jumping around on stage like Elon Musk was, it really brings attention to that type of activity that people maybe weren't paying that much attention to before. And I think that this cycle and potentially, you know, to some extent last cycle, just you know, anecdotally, it feels like there's a lot more people who are worried about the influence of corporate spending in politics. We're seeing many candidates actually making it a part of their campaign to um push back against corporate interests. There are pledges where candidates will not accept corporate PAC money that are fairly popular. I mean, I think there's a hundred plus candidates who've signed on to those types of things. And, you know, that's not something that was that common years ago in elections. And so I think that both candidates and everyday people are realizing that most people don't like corporate spending. I mean, it's like one of the most bipartisan topics out there. Republicans hate the influence of big money in tech or in in politics. Um, Democrats hate it, independents hate it, everyone hates it. But obviously, it's very challenging to get Congress people to say, sure, don't give me money. Uh, and so, you know, there's there's certainly a lot of barriers to it. But I do think that the more that this happens, the more it's going to become a salient issue for voters, for people who are elected, you know, elected officials, and, you know, potentially to tackle down the road, whether it's through some sort of legislation or ultimately trying to overturn that decision or you know, amend the constitution or take one of those bigger steps towards actually rectifying the issue.

SPEAKER_00 58:22

Yeah, the the free speech of corporations is one that we can uh that we can restrict and that probably won't be very commercial.

SPEAKER_01 58:27

Uh, and the money is speech, yeah.

SPEAKER_00 58:30

That's that's what I mean, right? The money is speech because that's how it's you know justified and stuff. Yeah. Um, Molly, it's it's really great to get all of this insight from you on you know what is coming in the US election cycle, and of course what we're what we're already seeing as so many of us will be watching this coming through November, and particularly what the tech industry is going to try to be doing. You know, I highly recommend people go sign up to your newsletter, uh, Citation Needed to get the updates on what is happening, and of course, regularly check Tech Influence Watch to see where this money is going. Uh, thanks so much for taking the time.

SPEAKER_01 59:00

Thanks again for having me.

SPEAKER_00 59:02

Molly White is the creator of Tech Influence Watch and writes the Citation Needed newsletter. Tech Won't Save Us is made in partnership with the Nation magazine and is hosted by me, Paris Marks. Production is by Kylie Houston. Tech Won's Save Us relies on the support of listeners like you to keep providing critical perspectives on the tech industry. You can join hundreds of other supporters by going to patreon.comslash tech won't save us and making a pledge of your own. Thanks for listening and make sure to come back next week.