Chamath Palihapitiya Comments on Chinese Human Rights Abuses Embarrasses Virgin Galactic

by Douglas Messier
Managing Editor

Well, this isn’t good for Virgin Galactic or the Virgin brand it represents. Gizmodo reports:

Chamath Palihapitiya, the chairman of Virgin Galactic and CEO of Social Capital, doesn’t care about the plight of Uyghurs—a Muslim-majority ethnic group that’s faced persecution by the Chinese government. Numerous reports out of China have documented how the Uyghurs have been subject to forced abortionssystematic rapetorture, and internment in concentration camps. But Palihapitiya says “nobody” cares about the Uyghurs, despite overwhelming evidence to the contrary.

Palihapitiya, who’s reportedly worth roughly $1.2 billion and is a co-owner of the [Golden State] Warriors basketball team, made the comments Saturday on his podcast, titled All In, which he co-hosts with tech industry veteran Jason Calacanis.

“Nobody cares about what’s happening to the Uyghurs,” Palihapitiya said. “You bring it up because you really care, and I think it’s nice that you care. The rest of us don’t care.”

The remarks caused an immediate uproar on social media. Chamath tried to walk back the statement, but he somehow made the whole thing about himself without really fully apologizing.

In re-listening to this week’s podcast, I recognize that I come across as lacking empathy. I acknowledge that entirely. As a refugee, my family fled a country with its own set of human rights issues so this is something that is very much a part of my lived experience. To be clear, my belief is that human rights matter, whether in China, the United States, or elsewhere. Full stop.

Chamath’s family left Sri Lanka for Canada when he was 5 years old (i.e., 40 years ago). So, if he actually cared about the horrid treatment of a minority group due to his background, why would he have gone out of his way to declare he didn’t? Was he telling the truth the first time?

Some social media commentators remarked that Chamath’s initial remarks reflected the self obsession, lack of empathy and pursuit of enormous wealth and power at all costs that is all too common in Silicon Valley’s insular, tech bros culture. (Facebook Founder/CEO Mark Zuckerberg is the poster child for critic’s of the valley’s culture.)

The New York Post reports that Virgin Galactic has distanced itself from Chamath’s comments.

A Virgin Galactic spokesperson told The Post that the company “believes every human being is entitled to fundamental human rights.”

“Chamath Palihapitiya’s comments do not reflect the views of Virgin Galactic and he does not speak on behalf of the company,” the spokesperson said.

Chamath contrasts sharply with Virgin Group Chairman and Virgin Galactic Founder Richard Branson. The British billionaire has championed a series of international campaigns, including abolishing the death penalty and repealing drug laws, both of which can disproportionately affect minorities. He has publicized his friendships with the late Nelson Mandela and Desmond Tutu, who both battled South Africa’s racist apartheid regime.

Branson’s ability to influence Chamath has diminished somewhat since the two men teamed to take Virgin Galactic public on the New York Stock Exchange in October 2019. Branson has sold more than $1 billion in Virgin Galactic stock over the past two years, reducing the Virgin Group’s share of the suborbital spaceflight company from more than 50 percent to 11.9 percent. Still, he remains a major shareholder.

Since going public, Virgin Galactic has gone from a Virgin-owned company to a Virgin-branded one. The space company actually licenses its name from the Virgin Group. There is a provision that allows the Virgin to withdraw its name if Galactic’s actions damages the brand. An obvious example would be a fatal accident that splatters a half dozen celebrities across the New Mexico desert. But, it’s not limited to that.

The Golden State Warriors, which has much more at stake in China, also distanced itself from Chamath’s remarks.

“As a limited investor who has no day-to-day operating functions with the Warriors, Mr. Palihapitiya does not speak on behalf of our franchise, and his views certainly don’t reflect those of our organization,” the NBA team tweeted.

Chamath put the NBA franchise in a delicate position. If the team stayed silent, it would look as callous as he sounded. Any hint of criticism of the Chinese government’s treatment of the Uyghurs risks blow back in the world’s most populous nation, where the NBA and basketball are extremely popular. That populated translates into billions in broadcast rights and merchandise sales.

In October 2019, Houston Rockets General Manager Daryl Morey tweeted a single image in support of Hong Kong residents who were protesting against the Chinese government’s treatment of the city. Yahoo Sports reports that consequences were quite serious for the team and the league.

China is the most significant growth market for the NBA and already accounts for nearly 10% of the league’s global revenue, Yahoo Finance has learned from multiple sources close to the league, including current and former NBA team executives. The NBA sees China as crucial to its financial future.

After the Morey tweet, the NBA issued a statement in which it acknowledged the tweet “deeply offended many of our friends and fans in China, which is regrettable.” The statement was seen by many as an apology to China. Soon afterward, Commissioner Adam Silver clarified that the league “will not put itself in a position of regulating what players, employees and team owners say or will not say on these issues. We simply could not operate that way.” Silver has also publicly claimed that the Chinese government asked him to fire Morey, and declared, “There’s no chance that’s happening.”

The financial damage to the NBA’s business in China has been “fairly dramatic,” Silver has acknowledged. China Central Television stopped airing Rockets games, Tencent stopped streaming them, Alibaba pulled Rockets merchandise from its online NBA store, and Anta suspended sneaker contract renewal talks, to name just a few examples...

It has been widely reported that the league’s global revenue is closing in on $10 billion per year, which puts it very close to Major League Baseball’s $10 billion and change, and still a distance from the NFL’s $15 billion.

It will be interesting to see if Chamath is more careful in the future about his public statements.