Pitting Private Tech Against the Public Sector is Bad for Everyone

How Marc Andreessen’s criticism of governmental responses to Covid misses the mark

Jennifer Pahlka


Photo by Andy Feliciotti on Unsplash

Last week, in an interview with Noah Smith, venture capitalist Marc Andreessen casually referred to the “chronic collapse of state capacity virtually everywhere in our time,” noting that the good news was that “the private sector can and does deliver even under considerable duress, and even when much of our political system is devoted to stifling it with regulatory handcuffs and damaging it with misguided policies.” We’ve just spent a year marveling at the fact that Zoom didn’t go down despite growing 3300%, that food still showed up at our doors when we summoned it, that we could continue to buy goods and services without ever touching or coming near to each other. In contrast, the feds botched the first Covid tests and every level of government scaled testing slowly, most parents, students, and teachers found online school miserable, and millions of laid-off workers couldn’t get unemployment insurance benefits. State regulators refused to allow Seattle scientists to test previously collected nasal swabs for Covid as it became clear the virus had hit US shores, thereby delaying US response by critical weeks. Stories like this rightly enraged the public.

In that environment, few seem to have batted an eye at Andreessen’s casual brushoff of governments everywhere. But his assertions are worth unpacking. Let’s start with the basis for comparing the sectors. The public sector does, by definition, what the private sector won’t and can’t. Not just because it’s not profitable, but because it’s complex, requires balancing a dizzying array of stakeholders, and just plain hard. I am genuinely impressed at Zoom’s performance over the pandemic, and grateful for it. But it’s not fair to compare that technical achievement, however enormous, to, say, the cross-sector effort to stand up effective contact tracing across geographies, jurisdiction, cultures, levels of government, and massively heterogenous legacy systems. The US government succeeded in some tasks during the pandemic; arguably, it did well enough where it mattered most to avoid an even worse catastrophe. And to credit the private sector exclusively with the economy’s comeback is to ignore the PPP loans, the stimulus payments, the increases in UI benefits, new tax credits, and all other forms of life support the government administered. Did we administer them perfectly? Of course not. But they mattered enormously, and Andreessen seems entirely blind to them.

Andreessen, of all people, knows that the entire premise of the market, and especially of venture capital, is that most businesses will fail. He focuses on the many businesses that succeeded, both in their missions and financially, during the pandemic, ignoring the failures. Some government functions fared better than others during the pandemic as well. Government is a monopoly generally because no one else wants to or can do what it does, so when it fails, there are usually no competitors to step in, unless you count moving to another city or state. The fact that these failures hurt people more does not mean that government necessarily performed worse than the private sector during this crisis, only that it is judged by a wildly different standard.

We acted as if the vaccine roll-out was a massive and deadly information problem when there was mostly just a regular old supply problem

And in some ways, the very companies that Andreessen lionizes actually made the problems government tackled worse. Remember the weeks after the announcement that vaccines would start to be distributed? Everyone was tearing their hair out about the fact that there was no national vaccine finder website, no single place where you could go to find where to get one. No matter that most of those people weren’t eligible to get it yet, or that there simply wasn’t enough supply for everyone. We acted as if there was a massive and deadly information problem when there was mostly just a regular old supply problem, which was entirely understandable, given that scientists had literally just invented the things. There were legitimate critiques that the lack of an easy way to find the vaccines made it hard for seniors, who were the first in line, and the poor, who may lack the time to “vaccine stalk,” but by and large the solution was for the privileged to stop vaccine stalking and chill out until it was their turn. The panic seemed largely driven by a very internet-driven expectation that an easy to use aggregator (“it should be as easy to find a vaccine as it is concert tickets”) was necessary to achieve the task, or that every problem is an information problem. If that were so, why, just a few months later, are most of the willing happily vaccinated? In the end, we got emails from our doctors offices, walked by neighborhood clinics, traveled to mega-sites. Perhaps how it happened didn’t meet our DoorDash-fueled expectations, but the job got done.

Though, of course, it’s not done, and that’s not because we lacked a “VaxxMaster.” It’s because lots of people believe crazy stuff about the vaccine and won’t take it. Whom do we have to thank for that? Well, Fox News for one, and…yes…the spread of misinformation on platforms run by companies like Twitter and Facebook, both Andreessen investments. There were many companies that helped the public sector get important jobs done, especially in public health, in the past year (notably Salesforce), and the social media platforms are trying (I guess) to tame the beasts they’ve spawned. But it would be nice if the “disruptors” helped with society’s biggest problems, the ones government has to tackle, rather than making them harder.

The dichotomy Andreessen assumes throughout the interview is also terribly misleading. Could the public sector have managed the vaccine rollout without the private sector? No. Could the private sector have achieved that without the public sector? Would pharmaceutical companies even have rushed the vaccines through clinical trials or agreed to manufacture them at massive scale had the US government not committed to buy them in massive quantities once they were produced? Again no. In almost anything important, the two collaborate, and while the public sector still has much to learn about how to take advantage of the digital age, the private sector has a lot to gain from the principles and values of the public sector. Pitting them against each other so nakedly isn’t very helpful.

Andreessen doesn’t seem to spend a lot of time tracking the performance of government digital services, but I do. So he’s not going to factor in public sector successes like the Defense Digital Service’s protection of the Project Warp Speed from sabotage, or their ability to stand up a Covid symptoms tracker in just a few days. He’s not likely to hear or care about how the pandemic pushed cities like Seattle to make ease of use a higher priority when selecting a scheduling vendor, and how that made it possible for them to process seven patients every five minutes. (This was with the help of the wonderful volunteers at USDR.)

And he’s not likely to tune into the steady drumbeat of praise and delight from veterans, who found getting vaccinated as easy as tapping on a link the VA texted them. The Minnesota Star-Tribune quotes veteran James Allison saying “Honestly, I’m still in shock because I never imagined it would be this fast and efficient. The VA is really looking out for us.” That’s the kind of customer feedback that means a pretty high net promoter score, and it’s for the long-derided Veterans Administration.

We should not be okay that we’ve let the institutions we count on for so much become so crippled

It’s not Andreessen’s job to know that those kinds of results aren’t an accident. They’re the result of intentional and hard-won investment in digital and operational capacity at places like the Department of Defense and the Department of Veterans Affairs over the past eight years. Marina Nitze proved the VA could deliver world-class service when she came in as CTO of the VA in 2013, and when she passed the baton to Charles Worthington, he and his team built on the trust she’d amassed and scaled that across the Department. It’s far from done, but an impressive accomplishment. And anyone who’s worked in a legacy environment knows that it’s far harder to create and sustain change from an entrenched status quo than it is to build something from the ground up. If we’re grading on a curve, the VA team deserves far higher praise than DoorDash or even Zoom. Even without the curve, the VA nailed this, but their progress doesn’t fit the narrative of Andreessen and his followers.

Neglecting the machinery of government is also a choice

This is not to say I disagree with Andreessen entirely. His pandemic theme has been “it’s time to build,” which has galvanized entrepreneurs into action in the face of a crisis. And I find his provocations useful. In a separate interview a few days later, he rails about bureaucratic quicksand that spent billions of California’s dollars and delivered nothing, and the “vetocracy” that means that anyone can say no but no one can say yes. It’s healthy to fight acceptance of this condition; we should not be okay that we’ve let the institutions we count on for so much become so crippled. But Andreessen’s solution is to throw the baby out with the bathwater and hand everything over to the private sector, or more specifically, to the companies he and his friends invest in. I’m grateful for the many conveniences those companies have provided me, and for the role some of them played in mitigating a public health crisis. (Zoom really did help! At least for knowledge workers.) But I still want to live in a democracy, not a startupocracy.

Of the vetocracy, Andreessen says “This is a choice, it’s a collective choice, but it’s a choice.” This reminds me of what Brian Lefler, an alum of the United States Digital Service, once said. “Neglecting the machinery of government is a choice.” Might that choice have something to do with the state of the public sector that Andreessen decries? I appreciate all that the venture capital world has built, but it’s time folks like Andreessen copped to their role in the choice to neglect the machinery of our government, and the consequences of that choice. In the same interview, he says “We do have the technological capability to fix a whole bunch of problems that we all agree that we have, and we also lack something in the national spirit or national character right now that really wants to actually fix these things. We want to complain about them; we just don’t want to fix them.” When it comes to government, Andreesen has no intention of fixing it. He just wants to complain. And that works fine for him, but it’s worth thinking about whether it works for the rest of us.



Jennifer Pahlka

Author of Recoding America: Why Government Is Failing in the Digital Age and How We Can Do Better, Fellow at the Federation of American Scientists