Silicon Valley Goes Ga-Ga Over Saudi, and the US Forgets Its Very Recent Past
Image Courtesy: National Review

Silicon Valley Goes Ga-Ga Over Saudi, and the US Forgets Its Very Recent Past

The Financial Times ran an interesting article today about the growing addiction of Silicon Valley to Saudi money. Saudi’s sovereign wealth fund and its private investment fund (PIF) are so flush with cash that everyone in the valley is trying to cozy up to Prince Mohammed and the other Saudi leaders. The article castes aspersions on everyone from Peter Thiel and Sergei Brin - who welcomed the Prince in the US with open arms - to Nvidia, Telsa, Uber, WeWork, Slack and Magic Leap - all of which have accepted large Saudi investments either directly or through Softbank, which is 50% owned by the PIF.

The issue of Saudi money seems likely to gain attention over the coming week as many have surmised that Saudi money sits behind Elon Musk’s claimed $420/share buyout tweet (however, the PIF is now reported to have no interest in leading a Tesla go private deal).

The FT article correctly highlights the hypocrisy of Silicon Valley’s liberal elite sucking up to a repressive regime as well as the risks of accepting Saudi money that may be fleeting where there is no reciprocal investment from the US in Saudi Arabia.

I, however, think that it is more important to remember that Saudi Arabia is a country which less than 17 years ago supported the most deadly attack on US soil and time and time again has sought to undermine our way of life. Just this past week, they threatened a similar attack against Canada with their media displaying airplanes crashing into the Toronto skyline after Canadia's Foreign Affairs Minister Chrystia Freeland spoke out in support of jailed Saudi human rights activists.

Wealthy technology tycoons believing that they are building the next great technology are always going to chase large sums of money. But, once upon a time (and not too long ago), the US, our government, and its regulatory bodies stood for something. And that something involved restricting the free flow of capital from despots into our country. Today, it seems to have turned towards blowing hot and cold at our allies and restricting trade and capital flows with them.

Ari Socolow
Ari Socolow: Ari Socolow is the Chief Economist and Editor-in-Chief at BestCashCow. He is particularly interested in issues relating to bank transparency and the climate crisis. Since co-founding BestCashCow in 2005, Ari has been frequently cited in the media as an expert on local and national savings accounts, CD products, mortgage and loan products and credit card rewards products.

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