By Jeanne Kuang, CalMatters
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Despite watching one after another of his state’s tech titans head to the White House to seek President Donald Trump’s favor, Gov. Gavin Newsom said Wednesday he doesn’t begrudge the industry’s rightward swing — mostly.
“It’s very situational with a lot of these guys,” he said when asked about tech businessmen going to “the other side.” “They are and they aren’t … I don’t see it as as big a shift as perhaps others do.”
His comments at a New York Times finance summit underscored the governor’s balancing act with the tech industry, even as his relationship with its major businesses has been strained by Trump this year. Though he has excoriated law firms and universities for “selling out” to Trump administration demands this year — even threatening to pull state funding from California universities that sign certain agreements with the president — Newsom has walked a finer line when it comes to tech.
“I think it’s a little bit more, I don’t want to say the word transactional, but it’s fiduciary,” he said of tech leaders’ decisions to curry favor with Trump .
Newsom, who was San Francisco mayor in the 2000s, has long been close with tech leaders. As governor, he counts on the industry’s outsized gains to keep a massive state budget balanced. As a possible 2028 presidential contender, he could find Silicon Valley’s deep-pocketed donors helpful.
The relationship has made Newsom a reliable politician in the industry’s corner as lawmakers in his own party increasingly push for regulations on social media and its effects on children, data centers’ use of environmental resources and artificial intelligence’s proliferation into workplaces, adolescent relationships and daily life.
While Newsom has signed some of those bills, particularly ones in which advocates negotiated with tech companies, he’s also vetoed several out of concern that overregulating a nascent industry would drive it out of state. And he’s vehemently opposing a proposed wealth tax that would undoubtedly touch tech executives.
Tech titans cozy up to Trump
That’s been the case this year despite Silicon Valley’s increasing coziness with Trump, whom Newsom has criticized for threatening industries with tariffs to extract concessions and demanding loyalty from private business executives. The relationship has affected California in a number of ways, from Tesla CEO Elon Musk’s aggressive pursuit of federal firings and cost-cuttings earlier this year to Salesforce CEO Marc Benioff’s suggestion that Trump send the National Guard to San Francisco, precipitating a nervous few days in October as the president moved to start immigration raids there. Benioff later walked back his statements and Trump said he relented after talking with him and Nvidia CEO Jensen Huang.
Peter Leroe-Muñoz, a senior vice president at the industry group Bay Area Council, praised Newsom for nevertheless understanding “the value of the innovation our member companies produce.”
“While the governor may not always agree with innovation companies and how they choose to operate or conduct themselves, at the end of the day the governor recognizes that we all have a stake in the success of California and so not cutting off ties or undermining those industry players is in the long term success of the Golden State,” Leroe-Muñoz said last month.
“There needs to be levels of ethics that are demanded of these leaders.”
Gov. Gavin Newsom, referring to tech leaders who make deals with Trump
Still, Newsom offered some criticism of the industry’s relationship with Trump on Wednesday, calling it “self-dealing” that the president’s AI and crypto czar David Sacks, along with many other investors and chipmakers, have reportedly been in line to profit from Trump’s AI directives.
“There needs to be levels of ethics that are demanded of these leaders,” he said. “That entire ecosystem has benefited from it. California has benefited from it. But I do not think it’s healthy for capitalism.”
And he called Apple CEO Tim Cook’s ability to strike a deal with Trump to get tariff exemptions for critical parts of the iPhone supply chain “by definition, crony capitalism.”
“How about the farmers and ranchers in California, how about all the small businesses that can’t pick up the phone and get an exemption on their tariffs?” Newsom said. “It breaks my heart.”
But he acknowledged Cook was serving his shareholders: “Do I begrudge that? Yes. Do I begrudge him? Not as much.”
This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.
