Reid Hoffman on Trump’s election and what’s next

BOB SAFIAN: Hi everyone, it’s Bob. Today I’m talking with Reid Hoffman, co-founder at LinkedIn and partner at Greylock, about this week’s election of Donald Trump as president. Reid has been a vocal critic of Trump’s, but the day after the election, he posted online about a peaceful transfer of power and the hard work of bridging divisions. He wrote, “I hope that the next four years will be our strongest yet.”

Reid and I talk now about what those four years might look like, what the impact will be on Silicon Valley, and what business lessons he’s taking away from his experience in politics. I’m Bob Safian, and this is Rapid Response.

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I’m Bob Safian, and I’m here with Reid Hoffman. Reid, thanks for doing this today.

REID HOFFMAN: My pleasure. It’s always great to talk to you, Bob, even in otherwise difficult weeks.

Copy LinkReid Hoffman’s reaction to Trump’s presidency

SAFIAN: Yeah. So over the past couple of years, you’ve not been shy about your wariness about Donald Trump as a presidential candidate. You put a lot of money behind that effort. You became a public figure in that opposition. Even on election day, you released a video on social media, urging people to reject Trump. The country has gone a different way. What have the past couple of days been like for you?

HOFFMAN: Well obviously, it’s this weird place where you’re basically hoping you were wrong, right? Because there were a number of folks I talked to who were like, Trump’s rhetoric on the campaign trail is extreme because that’s the way he gets his news and attention. It isn’t really going to be the way he’s going to govern. So it isn’t going to be crony capitalism with tariff wars. It isn’t going to be retribution to so-called enemies within. That’s just kind of his media campaigning, and it’s actually going to snap back to what’s good for business.

Obviously, I feared and still fear they were wrong, but now I’m hoping they are right. It’s kind of weird; I was making as strong a case as I could the other direction, but in this case, I’m hoping that I was wrong.

SAFIAN: Yeah. I mean, the stock market sure took off once the results were clear, which is an indication that investors feel like Trump and the Republican party are good for business. Did that surprise you?

HOFFMAN: No, not really, in part because the stock market tends to respond to short-term judgments about things like tax rates or stimulus packages.

And so, the general anticipation is that someone who is going to be more broadly laissez-faire business stimulus rather than broad-based lower-income community inclusion, that that’s going to be reflected in, “Hey, it’ll be a good time to be a stock market equity holder.”

We saw that in Trump’s first presidency as the initial take-off. Stock markets don’t predict things months in advance unless everybody sees it.

Copy LinkWhy Americans are dissatisfied with the economy

SAFIAN: One of the things that struck me about the election results is it sort of shows that voters have this strong dissatisfaction about their financial situation, even though the economy hasn’t actually been that bad, historically speaking. Inflation has certainly taken a bite, but the job market is strong. Why do you think so many Americans feel so dissatisfied?

HOFFMAN: Well, I think a lot of it, look, most Americans don’t realize the impact of the stimulus and COVID. They don’t understand that when I get a free hamburger today, it costs me tomorrow. They don’t have enough of a global perspective to realize that what Biden is doing has managed to keep inflation lower than in other developed countries. They’ve been better off because of it, but all they know is inflation is making it harder to pay bills. Of course, one should feel sympathetic to that.

When someone tells them that Joe Biden messed up the economy, it feels that way because it’s harder to make the economics work in life. On the one hand, yes, that’s true, and it feels that way, but it’s actually a result of all the COVID stimulus.

SAFIAN: Historically, when you had a job, it meant okay, the economy was more okay, and that didn’t really come through this time.

HOFFMAN: Yeah. Part of it is, among the challenges I have with some people within the Democratic party is to say, the most fundamental thing that pays for everything is the success of businesses from small to large. You should always be pro-business, pro-business growth.

It’s not business as the enemy for inclusion or addressing climate change. It’s business as the tool to get there because you essentially pay for everything. The problem is there’s turmoil within the Democratic party where the leadership doesn’t articulate a clear pro-business stance because some view business as an opponent.

Actually, it’s not business itself that’s the issue; maybe some businesses are ungreen or have social costs, but you have to be there. Without a clear message, when people say, “Your life is difficult because Democrats are socialists,” and some do call themselves socialists, that becomes the swing vote issue.

Probably, if one were to diagnose the proverbial straw that broke the camel’s back in this election, it’s that. There are still other legitimate issues around gender, leadership, and culture, but my guess is if the economics had been clearer, maybe the election would have gone the other way. There’s going to be a lot of postmortem quarterbacking, and I’m a little loath to add too much to it.

Copy LinkReid’s next steps from here

SAFIAN: Listening to you, are you still focused on the political sphere, or are you just going to return to business? What are your next steps from here?

HOFFMAN: Generally, my participation in politics has been a weird thing because I’m more naturally a founder, builder, and investor. What I’ve spent my entire life doing is trying to help what I think is the broader country on platforms for a stronger country, which got me engaged.

Initially, I’d find leaders in both parties to support. As it got more dire, the importance of truth-telling in discourse is fundamentally important to me.

So I made the strongest efforts I could, and now it’s back to what I’m more naturally suited for. My skill set naturally resolves to building companies, founding companies, investing in companies, and exploring what AI means for humanity’s elevation.

I have a book coming out in January called “Super Agency,” which discusses how AI can increase human agency and give us superpowers — an optimistic take. That’s where the focus will be for a long time.

SAFIAN: Many Democrats, folks who supported Harris, are not particularly optimistic right now. You are trying, emphasizing optimism still?

HOFFMAN: Well, it’s like I said at the opening: now I’m hoping I was wrong. You don’t just sit back; you try to help. I’m going to grow things in the American economy and make stuff work as strongly as possible.

If I were to continue in politics, I’d likely have a negative influence because it would be just oppositional. I think it’s best to add where I can contribute, which is on the business, technology, and investment sides.

Copy LinkPotential impacts on Silicon Valley

SAFIAN: What’s the future of Silicon Valley under Trump? What might change or stay the same?

HOFFMAN: It’s too early to tell. There’s hope that Trump won’t pursue grifter capitalism, but rather, work towards the platform of Silicon Valley, creating outcomes and things like that.

If that plays out, Silicon Valley can continue as perhaps the strongest American industrial complex. I’ve advocated for decades for Silicon Valley’s growth to help other American industries. The fear is crony capitalism for my friends only, leading to reduced economic outcomes.

For scale, Silicon Valley companies earn over half their revenue overseas, making it a strong export. Disrupting this reduces the economic inflow to the country, which through taxation and local spending aids prosperity. Ideally, you want as many strong export industries as possible.

That’s why I’m focusing on building strong American export industries to bring prosperity to the U.S. and trying to ensure industries benefit other parts of the country as well.

Copy LinkHow Trump might impact business and AI

SAFIAN: Hmm I mean, a lot of the listeners on this show are business leaders themselves. And it sounds like you’re saying maybe it’s a little early to be thinking about adjusting strategy.

I mean, lots of businesses are excited about the prospect of a Trump administration, obviously. But is your advice now to sort of wait and see? Are there things that you think businesses should be looking at, should be thinking about moving on now?

HOFFMAN: Probably the principle is planning on volatility. It’s the combination of hope and fear. Planning for unevenness, like if tariffs happen, it would hurt the U.S. export industry and reduce prosperity. If it’s more grifter capitalism, benefiting certain industries at the expense of others, it won’t elevate the whole platform.

Prepare for multiple options rather than committing to one overly.

SAFIAN: Do you have any insight about what a Trump administration might mean for the future of AI?

HOFFMAN: Not really. I suspect that the whole, like “we’re going to rescind the executive order on AI” is probably similar to the “we’re going to throw out Obamacare,” right? Which is: we actually don’t in fact have a better idea. And so we’re going to campaign against it to show why the earlier people were complete idiots and terribly bad, right?

But actually, in fact, we don’t have a better idea. So actually we’re just going to keep doing their idea, right? Because, here we are after a complete Trump term, and there was no repeal of Obamacare. So I think it’s probably similar, but that obviously could be different depending on various folks being in the mix and what the conception of AI is.

The one thing I would say I’m hopeful for is that the belief in the enablement of the American AI industry across multiple companies is in fact, I think, extremely important, and we’ll see whether or not that’s what’s playing, or if there will be a crony capitalist play. And, you know, obviously hope for the opportunity and fear, fear, fear, fear about the second.

Copy LinkRethinking the role of business in politics

SAFIAN: Has your experience changed your perspective on the role of business and tech leaders in politics and civic activity?

HOFFMAN: Um…

SAFIAN: I’ve stumped you.

HOFFMAN: No I’m thinking about it. Look, this is a week of processing. I was putting maximum energy into articulating key things about the future’s vision.

Even with Trump winning, the country is very divided. How do you get to unity? Even winning the popular vote shows division, and it’s about finding how we achieve unity as an entire country.

Tech is increasingly important in American society; therefore, tech leaders must engage in political discussions.

We need better discourse, reflecting on social media’s problems. I believe engaging in the political discussion as a society is crucial.

I plan to speak up, especially when fear of political retaliation is present, to give a voice and shelter. I won’t be silenced.

Upon people in positions of influence, it’s crucial to make the boat work best we can and oppose division.

America’s success lies in avoiding an attitude of making an administration unsuccessful. It’s about maximizing the country’s success. Part of that involves focusing on creating the next generation of industry-transforming tech companies.

Expect business leaders’ voices to prosper but avoid regulatory capture by large interests creating problems.

Copy LinkThe courage for business leaders to speak up

SAFIAN: It seems there’s a notion that business leaders can impact the future more than political realms. Do you see a shift in that perspective?

HOFFMAN: Business leaders are leaders, and must express opinions, especially against potential retaliation. Those with wealth and position should speak up because courage is easier for them.

Understanding the adaptability of businesses to their environment is essential, and Democrats seeking opposition will notice a focus on business thriving, which benefits jobs.

Optimists build the world. Amid adversity, ask how to build positively. Despite challenges, opportunities for positive building are always present.

SAFIAN: Well, I couldn’t agree more, Reid. Thank you for coming on and sharing with us.

HOFFMAN: Bob, always a pleasure. I suspect we’ll be talking again soon.

SAFIAN: Amen. Thank you.