Campaign funding and think tanks are great toys for policy-minded billionaires across the political spectrum, but market capitalism offers real strategic opportunities for those with resources to back up their rhetoric.
You’ve probably heard that Michael Bloomberg is spending $80 million in the next few months to push American politics back toward his vision of the center.
It means routing cash to candidates around the country, using a network of soft money entities to bypass personal contribution limits that supposedly level the playing field.
After all, Bloomberg is easily worth $50 billion. On that scale of wealth, the $2,700 cap on donations to federal elections that applies to the rest of us isn’t even a rounding error.
Even $80 million this year spread around the map is barely 0.1% of his net worth, a tithe of the interest he’d earn in the money market. He could easily spend a whole lot more.
Maybe the question is why he doesn’t. And every mega-billionaire in the country — across the spectrum from right to left through the center — needs to come up with good answers.
We already know the ultimate price tag on swinging the next election. A sure thing result might not cost more than $3 billion, provided the billionaires work together and keep their eyes on the prize.
Fox looking vulnerable
We know the president has a complex and intimate relationship with Fox News. The channel feeds on his every move and he responds to the feedback. Until he sees it on Fox, it’s fake news.
The solution is simple. Buy out Fox and change the game. Interrupt the loop.
Right now it’s practically impossible for an outsider to muscle in and change the culture. Fox is the crown jewel of what’s currently an $89 billion conglomerate. Bloomberg can’t afford to buy it outright.
Even if a team of billionaires like Jeff Bezos, Tom “Impeach Trump” Steyer and George Soros signed on, clawing the channel away from founder Rupert Murdoch would represent a substantial chunk of their collective capital.
Murdoch’s controlling shares complicate the situation a little further. It’s definitely a bigger commitment than writing an $80 million check when you’ve got $49.92 billion left to play with.
However, Fox won’t be embedded in that $89 billion conglomerate for long. With Disney gearing up to absorb a $71 billion chunk of the company, the remaining television assets are about to get small on a standalone basis.
The simplest math is that “New Fox” is worth $18 billion once you subtract out the parts Disney wanted.
While the Murdoch family will remain in control of 39% of the boardroom votes, Fox bylaws resolve questions of strategic ownership with a raw share-for-share referendum, reducing the footprint of Rupert and the boys to just 17% of the overall shareholder base.
Accumulate a bloc of 18% of New Fox stock and you’ve got a shot at outvoting Murdoch. Play hardball. Push him out.
It’s an expensive prospect, of course. Actively enforcing your agenda on the way the channel operates would cost even more to buy out contracts, revamp programming or even shut it down.
But the lowball bidding right now starts at barely $3 billion. That’s affordable for Bloomberg and practically pocket change for Bezos. Tell Bill Gates or Warren Buffett that it’s a matter of social philanthropy and money won’t be a problem.
Less prominent figures with sharper ideological axes can contribute. Tom Steyer may be only a mere billionaire, but he’s already paying $30 million on anti-Trump billboards that may or may not have any real impact at all.
If he’d use that money to buy a 0.1% stake in New Fox, the votes add up. And in the meantime, he’s getting a piece of a real business for his money. It pays tangible dividends. His accountants would cheer.
Love or hate the programming, Fox is a great business. It’s a decent investment in itself. When you’ve got an external motive — the equivalent of an “impact agenda” or what we used to call “social consciousness” — the possibilities multiply.
Or if you don’t want a network, nibble your way into a controlling stake in Twitter and do it that way. Right now someone could become a kingmaker over there with barely $2 billion and a compelling vision.
Even the hedge fund people I’ve worked with can afford that, provided of course they’re willing to go all in on that vision.
Scale and technology
Is owning Fox the equivalent of owning the White House? People have argued the point for decades. I think it’s just the world we live in now.
Politics has become big business. While the process itself is theoretically sacrosanct, lobbying blurs the line every day.
The political action committees, pay-for-play media and high-budget influence that dominate the scene today don’t quite add up to buying votes, but when you look at modern targeted advertising techniques, it’s an incredibly slippery slope.
Pick the right ZIP Code. Flood the zone with well-crafted messaging. Depress opposing viewpoints and get out your own vote. Win an election. Repeat.
It takes money to do it right, but the fundamentals are familiar to anyone who’s ever rolled out a commercial product. The only difference here is that the product is policy and instead of voting with their wallets, consumers vote with actual ballots.
People like the Koch brothers and George Soros are still in the relatively early stages of figuring this out. Other billionaires are lower in the learning curve — Bloomberg is still funding TV ads, for example.
But the playbook was written ages ago. Most recently it was perfected in the Fox business model. Aspects have spread to other media organizations struggling to compete.
Having the biggest megaphone is why plutocrats from William Randolph Hearst through Ted Turner to Jeff Bezos have loved owning newspapers and television groups. However, these are still nominally businesses, subject to the ebb and flow of cash.
If you’ve got the cash, it takes billions of dollars on the other side to shout you down. And with mega-billions already in play, the environment favors smarter and more ruthless strategies.
After all, that’s the Wall Street way. Hostile takeovers and activism in the name of capital are a fact of life.
Bezos could pay $18 billion in Amazon stock for as much of New Fox as he can grab and still have 70 million shares of his own company to play with. Give Buffett a taste and suddenly financing is easy — and Warren gets the tax policy he wants.
They haven’t been thinking in these terms yet. If this goes on, it’ll happen.
