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Taking on Trump: Silicon Valley investor returns home to run for Congress

  • Harder spent three years at Bessemer Venture Partners.
  • He's aiming to take on a House Republican that supported Obamacare repeal.
  • The 10th district is in a poor agricultural part of California's Central Valley.

Last year, Silicon Valley was united in its opposition to President Donald Trump. Then it fell into a collective depression when the New York businessman got elected to the White House.

As investors and tech executives mull what to do next, venture capitalist Josh Harder has opted for a new career path: He's running for Congress.

Harder, who spent the past three years at prominent tech investment firm Bessemer Venture Partners, recently moved back to his hometown of Turlock, California, 100 miles southeast of San Francisco, in California's Central Valley.

The 30-year-old Democrat and political rookie is building an army of volunteers and looking to tap his tech contacts for money as he aims to unseat Republican Congressman Jeff Denham in the state's 10th district next year.

"People in my generation, if they don't raise their hand and step forward — and are spending their time writing Facebook creeds instead of trying to affect change — then we deserve what we get," Harder, who went to high school in the district's biggest city Modesto, said in an interview with CNBC. "I'm frustrated and tired of standing on the sidelines."

In Denham's district, which is lined with almond fields and battered by 8 percent unemployment (higher in some parts), the Democratic Party is preparing to go hard after the incumbent, targeting his seat as one of the most likely to flip in 2018.

Democratic presidential nominee Hillary Clinton won the majority of votes there in the 2016 presidential election, and Denham, who was first elected to Congress in 2010, held on by less than 5 points.

Immigration binds Silicon Valley and the Central Valley

Harder is just getting started, knocking on doors and rallying support through small events, including an evening get-together for about 30 volunteers last week.

Josh Harder and his volunteers
Harder for Congress
Josh Harder and his volunteers

He sees no reason to wait. Across the country in Georgia, another 30-year-old Democrat, Jon Ossoff, is raising record sums of money to try and win a special election this month for a Congressional seat that Republicans have held since 1979.

Harder's big challenge is bridging the gap between his experience in the business and technology world with the needs of a rural area whose poverty rate of 20 percent is about 5 points above the national average, according to the latest census figures.

"The needs of his district really have nothing to do with tech priorities." -Ethan Kurzweil, partner at Bessemer Venture Partners

The tech industry, which donated about 40 times the amount of money to Clinton as to Trump last year, is a huge asset to Harder. But he knows some local voters might see him as a carpetbagger: He was educated at Stanford and Harvard, and spent the bulk of his career in white-collar consulting and tech jobs.

Harder, who still has plenty of connections to the Central Valley, including his parents in Turlock, said he spends all his time talking about three important local issues: jobs, health care and immigration.

"He's trying to run a local race," said Ethan Kurzweil, a partner at Bessemer who's worked closely with Harder and plans to donate to his campaign. "The needs of his district really have nothing to do with tech priorities."

However, immigration is one issue that unites Silicon Valley and the Central Valley against Trump's "America first" agenda and his proposal to build a wall between the U.S. and Mexico. While tech counts on engineering talent from overseas, about one-fifth of Stanislaus County is foreign-born, primarily from Latin America.

"Half our kids are Spanish speakers," said Kate Nyegaard, an 81-year-old resident of Modesto, who has spent almost her entire life in the district and previously sat on the school board.

Nyegaard and her husband, a doctor from Paraguay, recently hosted Harder at their house for a two-hour meet and greet. Based on the candidate's views on health care, climate change, immigration and women's rights, Nyegaard said she's all in for the young candidate.

"Denham is not really paying attention to what the people here want," said Nyegaard, who also happens to be the sister of film director and Modesto native George Lucas. "We could use some new faces and new energy."

A vulnerable Republican

Harder will first have to win what could be a hotly contested primary. He is one of five Democratic candidates already running, according to the Center for Responsive Politics.

Signs referring to the water shortage in Kettleman, California's Central Valley.
Harriet Taylor | CNBC
Signs referring to the water shortage in Kettleman, California's Central Valley.

If he gets through the primary, Harder believes Denham has made himself even more vulnerable since his narrow 2016 victory by siding with House Republicans to repeal the Affordable Care Act. The editorial board of the Modesto Bee said his vote would make the lives of his constituents "much worse."

In Stanislaus County, the heart of the 10th district, the number of uninsured dropped by 68 percent in the two years after ACA was implemented. Almost 63,000 people enrolled in ACA's Medicaid expansion are at risk of losing coverage, according to a study by the University of California at Berkeley.

"This is an area that feels and understands how misrepresented it is," Harder said.

California's Department of Health Care Services estimates that under the American Health Care Act, the replacement to the ACA, the state will see $24.3 billion in federal government funds cut by 2027.

Denham disputes that idea that the new health care bill, should it become law, will kick his constituents off Medicaid. He said the only people who will lose coverage are those who get a job. This week Denham introduced a bill in the House of Representatives to test new reimbursement models and make it more appealing for doctors to practice in areas with many Medicaid patients.

"There's still an access issue here," Denham said, in an interview. "We're responding to this on a step-by-step approach to address all aspects of health care."

But Harder also knows he can't win with only an anti-Trump platform. He needs a plan for economic growth in an area like Stanislaus County, where unemployment is almost twice the statewide average.

Modesto, California.
PROJimmy Emerson | Flickr
Modesto, California.

While there are some big employers like the E&J Gallo Winery and Conagra Brands, there have been too few new jobs to make up for the agricultural decline.

Harder wants to fuse the region's agricultural strengths with new technologies like water storage, a topic that resonates widely after California's historic drought. He's vowing to make the district the "agricultural technology capital of the nation," according to his website, and is more broadly promising to invest in the region's infrastructure.

"I look at my region of the country and I think we have so much opportunity to get better," Harder said. We need "to build on our agricultural foundation and move through to agricultural technology, agricultural processing and try to attract better jobs."