Person

Nick Hanauer

Nick Hanauer on the Laura Flanders Show, 2016. (link) by The Laura Flanders Show is licensed CC BY 3.0 (link)
Born:

1959

Nationality:

American

Role:

Progressive Donor and Activist

Nicholas “Nick” Hanauer is a progressive donor, venture capital investor, and political commentator. Hanauer is an activist for extreme increases in the minimum wage, a fervent financial supporter of gun control, and a multimillionaire jet-setter.[1]

In addition to his political and philanthropic work, Hanauer is a venture capitalist with Second Avenue Partners and chairman of his family business, Pacific Coast Feather Company.[2] Despite his advocacy for substantial tax increases, Hanauer was an early investor in Amazon, which has enabled substantial avoidance of state sales and use taxes.[3]

He is most notable for his advocacy of radically left-wing economic policies, especially in labor and employment, and his slapdash defense of those beliefs. Economist Adam Ozimek of Moody’s Analytics characterized Hanauer as “America’s worst minimum wage pundit” for the plutocrat’s straw-man arguments, misrepresentation of even progressive economists’ positions, and general ignorance of the functioning of price systems.[4] Hanauer has also faced criticism for failing to ensure that employees of his own companies are paid the entry wage minimums he advocates, which critics note refutes his heterodox economic principles.[5]

Hanauer is a major political player in his home state of Washington. He has spent substantially on ballot measure campaigns to raise the state minimum wage and increase gun control measures.[6] Seattle Mayor Ed Murray suggested that Hanauer would “draw up the details” of the embattled politician’s $275 million property tax increase.[7]

Personal Life and Business Career

Hanauer got his start in business with his family’s bedding manufacturing company, Pacific Coast Feather Company. By the late 1990s, Hanauer had branched out into internet investing, becoming an early backer of Amazon.com.[8] Hanauer has spoken unkindly of Amazon, stating once that the online retailer he helped launch “probably destroyed a million jobs in our economy.”[9]

He later founded aQuantive, an online advertising firm he later sold to Microsoft.[10] Currently, Hanauer is a venture capitalist with Second Avenue Partners and additionally serves as chairman of Pacific Coast Feather Company.[11]

The interaction of Hanauer’s business ventures and practices with his political activism have led to criticism. In 2014, Pacific Coast Feather opened a factory in North Carolina backed by government incentives with starting employee pay reported at $7.50 per hour while Hanauer, the company’s chairman, was promoting a national minimum wage of $15 per hour and claiming such a policy had no trade-offs.[12] When challenged on this apparent hypocrisy—Hanauer’s blog Civic Skunk Works had called businesses that didn’t pay high minimum wages “predatory”—Hanauer doubled down demanding a minimum wage hike.[13] Hanauer has also callously declared that paying minimum wage or near minimum wage (as Pacific Coast Feather reportedly does) amounts to saying, “I would pay you less, except then I’d go to prison.”[14]

Hanauer lives with his wife Leslie in Shoreline, Washington in the gated community The Highlands.[15] Hanauer’s residency caused controversy when Nick was appointed to a position on the now-defunct Seattle Popular Monorail Authority, which required members to be Seattle residents.[16]

Progressive Activism

Hanauer has used his business credentials and fortune to launch a second career as a major progressive activist. He is reported to have sat on the board of the donor consortium Democracy Alliance in the past.[17]

Hanauer’s first major entry into the political arena was as co-founder of the League of Education Voters (LEV), an education policy pressure group, in his home state of Washington in the early 2000s.[18] He later partnered with former Clinton administration speechwriter and official Eric Liu on a manifesto for left-wing patriotism, titled The True Patriot.[19] Hanauer and Liu wrote a second book advocating liberal economic theories called The Gardens of Democracy: A New American Story of Citizenship, the Economy, and the Role of Government ahead of the 2012 elections.[20]

Hanauer’s political profile surged in 2012 when he gave a “TED Talk” alleging that businessmen did not create jobs and endorsing tax increases. In apparent alignment with the TED organization’s policy of releasing only a limited number of talks for public taping, Hanauer’s was not selected. This led Hanauer reportedly to start a public relations campaign involving progressive activist group MoveOn.org that led to National Journal alleging the talk was effectively censored.[21]

Minimum Wage

Since that event, Hanauer has become a darling of the economic far-left. Hanauer has endorsed the Service Employees International Union (SEIU) proposal for a $15 per hour minimum wage, claiming that economic theory-based objections to doubling the federal wage floor were “a scam.”[22] Hanauer has defended his claim by noting that aggregate total employment has increased over time despite increases in minimum wages, a defense also offered by the labor-union-supported National Employment Law Project (NELP). Economists note that these correlations prove nothing about the actual impact of minimum wages.[23]

Hanauer’s offhand dismissal of conventional economic methods has led to his badly misunderstanding the terms of the minimum wage debate in which he figures. He said in a tweet about former Obama administration economist Alan Krueger that Krueger, perhaps best known for supporting moderate increases to the minimum wage, “carries water for trickle down Econ [sic].”[24] In addition, in responding to predictions that a $15 minimum wage would reduce restaurant employment, Hanauer claimed that hike opponents were predicting “no restaurants in Seattle,” a straw man.[25]

Hanauer’s high-end tastes (he reportedly owns a Dassault Falcon private jet) have influenced his policy propsals.[26] In an email to a Seattle City Councilor backing including franchise small businesses in a minimum wage increase, Hanauer[27] endorsed “independent, locally owned, unique sandwich and hamburger restaurants” over “extractive national chains.”

Hanauer has endorsed a minimum wage as high as $28 per hour, claiming that “if the minimum wage had tracked what the top one percent made […] we would have an unbelievably robust economy.”[28] A survey of economists found that roughly three-fourths of economists opposed a $15 per hour minimum wage, with a majority of self-described Democratic economists surveyed also opposing a wage at that level or higher.[29]

Gun Control

Hanauer is a major supporter of efforts to restrict firearm ownership rights. He co-founded the Washington Alliance for Gun Responsibility, a campaign group for gun control that backs ballot measure campaigns in the state.[30]

Hanauer has also contributed to ballot campaigns for gun control in other states. He backed an unsuccessful effort to expand background check requirements in Maine in 2016, contributing at least $125,000.[31] He contributed $275,000 to a gun control measure in Nevada as well.[32]

In keeping with his callous brand of politics and business, Hanauer has a history of caustic statements about opponents of gun control. Shortly after a shooting at a Washington school, Hanauer mocked gun rights supporters by posting, “We need more school shootings!!! [sic] Vote yes on Initiative 591 [a gun-rights proposal].”[33]

Tax Increases

Hanauer was a major funder of a 2010 statewide ballot measure to establish an income tax in Washington. He contributed at least $250,000 to the campaign for I-1098, which was defeated.[34]

In 2017, Hanauer proposed a property tax increase ballot measure for Seattle that was endorsed by embattled mayor Ed Murray. Hanauer reportedly offered to single-handedly fund the ballot measure campaign if necessary.[35] Hanauer, a resident of the King County municipality of Shoreline, would not be subject to the tax on his principal residence, according to former Seattle mayoral aide Jordan Royer.[36]

Other Political Activities

Hanauer and his wife Leslie control a private foundation, the Nick and Leslie Hanauer Foundation.[37] Notable left-wing grant recipients include the Roosevelt Institute, Washington Progress Fund, and George Soros’s Institute for New Economic Thinking.[38] The Hanauers are also notable contributors to Democratic campaigns, with recipients including numerous state Democratic Parties, former U.S. Senator Russ Feingold (D-Wisconsin), U.S. Senator Maggie Hassan (D-N.H.), and 2016 Democratic Presidential nominee Hillary Clinton.[39]

Hanauer runs a hybrid think tank and political operation called Civic Ventures. Hanauer hired Zach Silk, a progressive ballot measure strategist, to head the operation.[40]

References

  1. Ball, Molly. “A Plutocrat’s Case for Raising the Minimum Wage.” The Atlantic. December 28, 2015. Accessed May 02, 2017. https://www.theatlantic.com/magazine/archive/2016/01/a-plutocrats-case-for-raising-the-minimum-wage/419130/
  2. McMorris, Bill. “Chairman Favors $15 Minimum Wage, Pays Own Employees Less.” Washington Free Beacon. March 8, 2016. Accessed May 02, 2017. http://freebeacon.com/issues/ceo-favors-15-minimum-wage-pays-own-employees-less/
  3. McMorris, Bill. “Nick Hanauer: TED Head.” Washington Free Beacon. September 18, 2012. Accessed May 02, 2017. http://freebeacon.com/democracy-alliance/nick-hanauer/
  4. Ozimek, Adam R. “America’s Worst Minimum Wage Pundit.” Modeled Behavior. May 29, 2016. Accessed May 02, 2017. https://www.forbes.com/sites/modeledbehavior/2016/05/29/americas-worst-minimum-wage-pundit/#554ff724414c
  5. McMorris, Bill. “Chairman Favors $15 Minimum Wage,Pays Own Employees Less.” Washington Free Beacon. March 8, 2016. Accessed May 02, 2017. http://freebeacon.com/issues/ceo-favors-15-minimum-wage-pays-own-employees-less/
  6. Ryan, John. “$14M fuels initiatives on the November ballot. Who’s behind the money?” KUOW News and Information. July 13, 2016. Accessed May 04, 2017. http://kuow.org/post/14m-fuels-initiatives-november-ballot-whos-behind-money
  7. Coleman, Vernal, and Daniel Beekman. “Superwealthy entrepreneur decides to ‘go all out’ with property-tax plan to fight Seattle homelessness.” The Seattle Times. February 28, 2017. Accessed May 03, 2017. http://www.seattletimes.com/seattle-news/politics/superwealthy-seattle-entrepreneur-pushing-property-tax-to-battle-homelessness/
  8. Hanauer, Nick. “The Pitchforks Are Coming… For Us Plutocrats.” POLITICO Magazine. June 2014. Accessed May 03, 2017. http://www.politico.com/magazine/story/2014/06/the-pitchforks-are-coming-for-us-plutocrats-108014#.VX8ZiFVVhHx
  9. Cohen, Aubrey, and SeattlePI.com Staff. “Investor: ‘Amazon probably destroyed a million jobs'” Seattlepi.com. February 17, 2014. Accessed May 04, 2017. http://www.seattlepi.com/business/tech/article/Investor-Amazon-probably-destroyed-a-million-5242250.php
  10. Adeniji, Ade. “Meet Nick Hanauer, A Wealthy Tech Guy With Plenty of Ideas.” Inside Philanthropy. January 26, 2016. Accessed May 03, 2017. https://www.insidephilanthropy.com/tech-philanthropy/2016/1/26/meet-nick-hanauer-a-wealthy-tech-guy-with-plenty-of-ideas.html
  11. McMorris, Bill. “Nick Hanauer: TED Head.” Washington Free Beacon. September 18, 2012. Accessed May 02, 2017. http://freebeacon.com/democracy-alliance/nick-hanauer/
  12. McMorris, Bill. “Chairman Favors $15 Minimum Wage, Pays Own Employees Less.” Washington Free Beacon. March 8, 2016. Accessed May 02, 2017. http://freebeacon.com/issues/ceo-favors-15-minimum-wage-pays-own-employees-less/
  13. Shannon, Erin. “Starbucks and other companies lead by example by increasing workers’ wages…what about Nick Hanauer?” Washington Policy Center. July 14, 2016. Accessed May 05, 2017. http://www.washingtonpolicy.org/publications/detail/starbucks-and-other-companies-lead-by-example-by-increasing-workers-wageswhat-about-nick-hanauer
  14. Hanauer, Nick. “A Wealthy Capitalist on Why Money Doesn’t Trickle Down.” BillMoyers.com. September 11, 2014. Accessed May 05, 2017. http://billmoyers.com/2014/09/11/a-wealthy-capitalist-on-why-money-doesnt-trickle-down/
  15. Raftery, Isolde. “14 top political donors in Washington state and what they support.” KUOW News and Information. May 4, 2016. Accessed May 05, 2017. http://kuow.org/post/14-top-political-donors-washington-state-and-what-they-support
  16. Jenniges, Amy. “Controversial Monorail Board Appointment.” The Stranger. February 13, 2003. Accessed May 05, 2017. http://www.thestranger.com/seattle/in-other-news/Content?oid=13364
  17. McMorris, Bill. “Nick Hanauer: TED Head.” Washington Free Beacon. September 18, 2012. Accessed May 02, 2017. http://freebeacon.com/democracy-alliance/nick-hanauer/
  18. Adeniji, Ade. “Meet Nick Hanauer, A Wealthy Tech Guy With Plenty of Ideas.” Inside Philanthropy. January 26, 2016. Accessed May 03, 2017. https://www.insidephilanthropy.com/tech-philanthropy/2016/1/26/meet-nick-hanauer-a-wealthy-tech-guy-with-plenty-of-ideas.html
  19. Liu , Eric, and Nick Hanauer. “Earning Our Pride.” Time. June 27, 2008. Accessed May 04, 2017. http://content.time.com/time/nation/article/0,8599,1818424,00.html
  20. Liu, Eric, and Nick Hanauer. “The Machine and the Garden.” The New York Times. July 10, 2012. Accessed May 05, 2017. http://www.nytimes.com/2012/07/11/opinion/our-gardenbrain-economy.html
  21. Upbin, Bruce. “The Real Reason That TED Talk Was ‘Censored’? It’s Shoddy And Dumb.” Forbes. August 09, 2012. Accessed May 04, 2017. https://www.forbes.com/sites/bruceupbin/2012/05/17/the-real-reason-that-ted-talk-was-censored-its-shoddy-and-dumb/#14118d6f7978
  22. Hanauer, Nick. “Column: The claim that if wages go up, jobs will go down is not a theory — it’s a scam.” PBS. October 06, 2016. Accessed May 04, 2017. http://www.pbs.org/newshour/making-sense/column-claim-wages-go-jobs-will-go-isnt-theory-scam/
  23. Worstall, Tim. “Nick Hanauer’s Mindboggling Defence Of The Minimum Wage.” Forbes. October 11, 2016. Accessed May 04, 2017. https://www.forbes.com/sites/timworstall/2016/10/11/nick-hanauers-mindboggling-defence-of-the-minimum-wage/#1ee002a561fe
  24. Ozimek, Adam R. “America’s Worst Minimum Wage Pundit.” Modeled Behavior. May 29, 2016. Accessed May 02, 2017. https://www.forbes.com/sites/modeledbehavior/2016/05/29/americas-worst-minimum-wage-pundit/#554ff724414c
  25. Ozimek, Adam R. “America’s Worst Minimum Wage Pundit.” Modeled Behavior. May 29, 2016. Accessed May 02, 2017. https://www.forbes.com/sites/modeledbehavior/2016/05/29/americas-worst-minimum-wage-pundit/#554ff724414c
  26. Ball, Molly. “A Plutocrat’s Case for Raising the Minimum Wage.” The Atlantic. December 28, 2015. Accessed May 02, 2017. https://www.theatlantic.com/magazine/archive/2016/01/a-plutocrats-case-for-raising-the-minimum-wage/419130/
  27. “Hanauer got rich, which he thinks qualifies him to tell you what to do.” Shift Washington. August 12, 2014. Accessed May 05, 2017. https://shiftwa.org/hanauer-got-rich-which-he-thinks-qualifies-him-to-tell-you-what-to-do/
  28. Cook, John. “This venture capitalist says a $28 minimum wage would create a more robust economy.” GeekWire. May 11, 2016. Accessed May 04, 2017. https://www.geekwire.com/2016/venture-capitalist-says-28-minimum-wage-create-robust-economy/
  29. Fowler, Tracy A., and Andrew E. Smith. “Survey of US Economists on a $15 Federal Minimum Wage.” Employment Policies Institute. November 2015. Accessed May 4, 2017. https://www.epionline.org/wp-content/uploads/2015/11/Nov2015_EPI_MinWageSurvey4.pdf
  30. “Nick Hanauer.” Inside Philanthropy. Accessed May 04, 2017. https://www.insidephilanthropy.com/guide-to-individual-donors/nick-hanauer.htm
  31. Thistle, Scott. “Effort to require background checks for Maine private gun sales gets big donation – Portland Press Herald.” Press Herald. July 29, 2016. Accessed May 04, 2017. http://www.pressherald.com/2016/07/28/maine-group-pushing-for-private-gun-sale-background-checks-gets-another-financial-boost/
  32. Miniter, Frank. “How Anti-Gunners Abuse Voter Initiatives Part II.” America’s 1st Freedom. August 22, 2016. Accessed May 04, 2017. https://www.americas1stfreedom.org/articles/2016/8/22/how-anti-gunners-abuse-voter-initiatives-part-ii/
  33. Raftery, Isolde. “Too Soon? Nick Hanauer Posts Sarcastically, ‘We Need More School Shootings!!!'” KUOW News and Information. October 24, 2014. Accessed May 05, 2017. http://kuow.org/post/too-soon-nick-hanauer-posts-sarcastically-we-need-more-school-shootings
  34. Schrader, Jordan. “Rich guys split on income tax.” The Olympian. October 12, 2010. Accessed May 05, 2017. http://www.theolympian.com/news/politics-government/election/article25267237.html
  35. Rantz, Jason. “Rantz: Nick Hanauer hates big money, but will buy election.” MyNorthwest.com. March 03, 2017. Accessed May 05, 2017. http://mynorthwest.com/561908/progressive-hates-big-money/
  36. Royer, Jordan. “Seattle, where millionaires push taxes on everyone else.” Crosscut. March 01, 2017. Accessed May 05, 2017. http://crosscut.com/2017/03/seattle-will-obey-hanauer-but-should-ask-questions/
  37. “Nick Hanauer.” Inside Philanthropy. Accessed May 04, 2017. https://www.insidephilanthropy.com/guide-to-individual-donors/nick-hanauer.htm
  38. Nick and Leslie Hanauer Foundation, Return of a Private Foundation (Form 990-PF), 2015, Part XV Line 3
  39. Center for Responsive Politics. “Donor Lookup – Hanauer.” OpenSecrets. Accessed May 05, 2017. https://www.opensecrets.org/donor-lookup/results?cand=&cycle=2016&employ=&name=Hanauer&page=1&state=WA&zip=
  40. Ball, Molly. “A Plutocrat’s Case for Raising the Minimum Wage.” The Atlantic. December 28, 2015. Accessed May 05, 2017. https://www.theatlantic.com/magazine/archive/2016/01/a-plutocrats-case-for-raising-the-minimum-wage/419130/
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