Power Players

Google billionaire Eric Schmidt on AOC's claim billionaires are a policy failure: She doesn't see the situation clearly

Eric Schmidt, left, and Alexandria Ocasio-Cortez
Christophe Morin/IP3 | Getty Images; Jenny Anderson | ABC via Getty Images

Recently, there has been much debate about whether billionaires should exist, an idea popularized by Congresswoman Alexandria Ocasio-Cortez. But to former Alphabet executive chairman and investor Eric Schmidt, who is worth more than $17 billion, the idea that extreme wealth is a moral failure is reductive.

"We would probably all be better off spending more time understanding the contributions made by specific individuals and not making generalizations about anyone," Schmidt told Eben Shapiro, the deputy editor of Time, in an interview about his philanthropic initiative, Schmidt Futures, and other topics, published Sunday.

Shapiro had asked Schmidt, who is most famous for being Google's CEO from 2001 to 2011, to respond to the slogan, "Every billionaire is a policy failure," an idea that Ocasio-Cortez adopted from political advisor, Dan Riffle, who she worked with shortly after entering office.

According to Ocasio Cortez, a system that allows billionaires to exist is immoral. "I don't think that necessarily means that all billionaires are immoral," she at an event in New York City in January 2019, mentioning billionaire philanthropists Bill Gates and Warren Buffett. But, said AOC, it is "wrong" for billionaires to exist when extreme poverty also exists – when "in parts of Alabama...people are still getting ringworm because they don't have access to public health."

In addition to his career in tech, Schmidt co-founded Schmidt Futures with his wife, Wendy, in 2017. According to its website, Schmidt Futures "finds exceptional people and helps them do more for others together while promoting innovative approaches to problem solving across disciplines." Most recently, in November, the organization launched Rise, a program to support teens, in partnership with Rhodes Trust (best known for its Rhodes Scholarship).

Shapiro also asked Schmidt if he knew the the book "Winners Take All: The Elite Charade of Changing the World" a book by Anand Giridharadas. The book, said Shapiro, asserts "that people like yourself use philanthropy to alleviate social pressure but also shape change in a way that will continue to benefit themselves."

"That is certainly not my goal," Schmidt told Shapiro.

"What have I done in my career? I basically networked the world and got information in everyone's hands. I defy you to argue against making the average person smarter," Schmidt said. "That's presumably a nonelitist strategy, right?

"And I would further say that if you look at the philanthropists in the [1860s], Rockefeller and those guys, they were generally hated. But the institutions that they left have had great value to society."

One of the famous 19th Century robber barons (tycoons who were seen as using unscrupulous methods to build their fortunes), John D. Rockefeller made his money from railroads and oil. But he also gave vast amounts of money to any number of institutions including The University of Chicago; the Rockefeller Institute for Medical Research, now Rockefeller University; and the Rockefeller Sanitary Commission, which helped eradicate hookworm in the South in the early 1900s.

In November, Ocasio Cortez, who also supports higher tax rates on the wealthy, was re-elected to a second term representing New York's 14th congressional district.

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