Silicon Valley elite in the cross hairs of inequality debate

When Tom Perkins, founder of the prominent Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers wrote a letter to the Wall Street Journal recently, comparing a growing public aversion to the wealthy "One Per Cent" to the Nazi's Kristallnacht, he rightly came under severe criticism.

In a Bloomberg television interview a few days later, he apologised for using the term, but upheld the bizarre comparison: "Jews were only one per cent of German population, yet Hitler was able to demonise the Jews."

The rest of the interview was like a slow-motion train wreck, exuding a disturbing level of arrogance summed up by his absurd aside that he was wearing a watch so expensive that it was worth “a six-pack of Rolexes”, a term that then flooded the Twittersphere.

For many observers, the interview added more incontrovertible evidence to the argument that Silicon Valley, its culture and especially its chief executives are totally out of touch with normal people’s lives.

This is a topic that has been coming to a slow boil for a while now.

It has had its most obvious physical representation in the growing tensions in San Francisco over what is seen as a techie invasion of the city, resulting in rising rents and property valuations.

That dissonance between the haves and have-nots has been captured by a few San Francisco-based start-up chief executives whose comments have widely offended.

Prominent among those were observations by former AngelHack chief executive Greg Gopman, who wrote a Facebook rant against San Francisco's street people.

“The difference is in other cosmopolitan cities, the lower part of society keep to themselves. They sell small trinkets, beg coyly, stay quiet and generally stay out of your way. They realise it’s a privilege to be in the civilized part of town and view themselves as guests. And that’s okay.”

Gopman has since apologised. But such views epitomise the tensions between those who are seen as nouveau riche newcomers and San Francisco’s longtime residents – a diverse hodgepodge that has always wanted “the lower part of society” mixed right into “the civilized part of town”.

It's been part of the city's policies and politics forever, as Gary Kamiya points out in a chapter of his wonderful new book about San Francisco, Cool Gray City of Love .

In recent weeks, such ill-advised comments have been gathered together in a number of articles arguing that the Valley (now seen to extend up to San Francisco) and in particular its chief executives, are out of touch, arrogant idiots in an industry ready for a big fall.

Most of these articles originate in East Coast-based online and print publications, some with close ties to Wall Street, which, I’d argue, has a lot more to answer for than a handful of silly tech chiefs.

After all, if one wants to compile a working list of arrogant company executives, the names that quickly spring to mind are outside the technology sector (by contrast, how many have heard of Greg Gopman?).

And if one is looking for a specific area of real estate that most represents arrogance, Wall Street has greater claim than the bland tracts of technology offices around San Jose and San Francisco.

That said, there are real tensions, especially in San Francisco.

But there is also genuine excitement and reinvigoration, thanks to the same tech sector.

In a recent piece for Salon.com, Andrew Leonard says: "The rise of the sharing economy and the brazen pugnacity of Silicon Valley explain both Nasdaq's current frothiness and the class anxieties the New York Times has finally caught up to."

It’s notable that much of the harshest criticism on Twitter as Perkins’s Bloomberg interview ran came from well-known Valley entrepreneurs and chief executives.

It’s not like they are a voting bloc for the One Per Cent.

Maybe this is all mostly local and regional US politics. We haven’t had the same kind of tension play out here.

In part, that's probably because both the young and the established companies in the tech sector in Ireland, whether indigenous or multinational, are seen to have come in and created jobs, refreshed run-down neighbourhoods and bolstered economically hurting towns.

Most of the tech tension here is actually internal and under the radar, between indigenous and multinational companies – or rather, the way in which those two segments are treated by the Government.

One benefits from inducements, supportive tax structures and an IDA love-in – even small Valley start-ups that might be looking to set up here.

The same benefits are not accorded if you are “only” an Irish company, founded in this country and also creating jobs and value for the Irish economy.

I suspect that is going to become more of a battleground as the economy strengthens, the tech sector here continues to grow, and indigenous tech start-ups wonder why too often, they are treated like second-class citizens in their own country.