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19 March 2018

The Facebooker who fell to earth: how Chris Hughes learned to limit his ambitions

His own fortune is down to luck, but now Hughes is helping to fund research into ending poverty in the US.

By Sophie McBain

Chris Hughes is the first to admit that he’s fortunate. The 34-year-old multi-millionaire grew up in small-town North Carolina, the son of a paper salesman and a public school maths teacher, and won a scholarship to a private boarding school and then a place at Harvard, which is where his luck really kicked in.

During his second year he shared a room with Mark Zuckerberg, someone he didn’t know well but whom he’d often met at parties and who struck him initially as “a genius of some sort, but something of a misanthrope”. When Zuckerberg built Facebook, Hughes, the only non-coder of the Harvard group, became its spokesman. A few months after the site’s launch in 2004, he negotiated a two per cent stake. Hughes says he made nearly half a billion dollars in three years.

Hughes now wants his super-rich peers to be more “upfront” about their good luck, and the extent to which remuneration has become untethered from work in the modern, winner-takes-all economy. The economic forces that propelled the growth of Facebook have contributed to rising inequality in the US, where the richest 0.1 per cent control as much wealth as the poorest 90 per cent. “For a lot of Americans a job is increasingly just a gig,” Hughes told me when we spoke on the phone. “Over the past decade, nearly all of the jobs that we’ve created have been part-time, temporary, or seasonal.”

This February he published his first book, Fair Shot, in which he details his proposed solution to rising inequality and job insecurity: providing all working Americans who earn under $50,000 a year with a basic income of $500 a month, paid for by raising income tax to 50 per cent on earnings over $250,000 a year. He wants to expand the definition of work too: his proposed cash transfer programme would also cover students and those caring for dependents, who account for half of the Americans classified as unemployed.

The idea of establishing a universal basic income has gained traction among Silicon Valley executives in recent years, many of whom are concerned by the potential for artificial intelligence and automation to put humans out of work. Hughes wants to distance himself from this movement. He says he’s less interested in potential tech dystopias than the economic problems that are already manifestl. Fair Shot is part policy document, part memoir – and the personal story Hughes wants to spin isn’t just about how the small-town boy made it to the big time, but also about how he learned to limit his ambitions. 

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In 2012, when he was 28, Hughes bought the New Republic (TNR), a small liberal magazine with an outsized reputation that had struggled financially for most of its near 100-year history. (In 2013, the New Statesman and TNR briefly partnered, sharing content on their respective websites.) Hughes had left Facebook five years earlier to work on Barack Obama’s digital campaign and in 2008, a Fast Company magazine cover declared him “the kid who made Obama president”. Franklin Foer, TNR’s former editor, later wrote that he saw Hughes as the magazine’s “mythical saviour”.

The New Republic had a print circulation of around 50,000, and Hughes aimed to expand its digital reach to “millions, if not tens of millions” of new readers. He invested $20m in the publication in four years. Hughes now concedes that he “overinvested”, “set unrealistic goals” and lacked the “patience” to manage the magazine’s transformation. In 2014, he brought in a digital guru, Guy Vidra, as chief executive, precipitating a clash with Foer so explosive that most of the editorial team resigned en masse.

“It took me some time to understand what many people already knew, which is that the New Republic had always been a not-for-profit,” he told me. “In retrospect, the better thing would have been to adopt more modest means, to invest in the journalism and not gone so far so fast.”

Hughes sold the New Republic in 2016 and that year helped found the Economic Security Project, which funds research into how cash transfer programmes could be used to end poverty in the US. He developed an interest in the subject in 2012, when he started donating to a global charity called GiveDirectly, which rather than funding aid projects, makes unconditional transfers to the extreme poor via mobile phone.

In late February, I watched Hughes outline his views to a small, wonkish audience at 92nd Street Y, a cultural centre in Manhattan. Hughes is slight, with fine, boyish features and sandy coloured hair that he combs into a neat side parting. He spluttered with surprise when asked why he was a class traitor – “I feel loyalty to the class I grew up with,” he replied – but seemed at ease answering technocratic questions and quoting economic research and statistics.

It’s hard to overestimate how personal and vitriolic the fight over the New Republic became. Hughes was excoriated in the press, with the Daily Beast describing him and his husband, the former Democratic congressional candidate Sean Eldridge, as “entitled brats” and as “America’s worst gay power couple”. Friends renounced Hughes on Twitter, dinner invitations were rescinded, strangers shouted at him at parties. But Hughes is sanguine. “The rollercoaster goes up and it goes down, and it will go up and down again, I’m sure,” he said. “So staying grounded and trying to understand that reality is something in between is something that I’ve now got some practice in.” 

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This article appears in the 14 Mar 2018 issue of the New Statesman, Putin’s spy game