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Warren Is the WeWork Candidate – The Wall Street Journal

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WeWork founder Adam Neumann in New York, Jan. 16, 2018.


Mark Lennihan/Associated Press

Are presidential candidate

Elizabeth Warren

and WeWork founder

Adam Neumann

the same person? I mean, they have different hairstyles and all, but their philosophies are more alike than not.

They both claim, falsely, to be capitalists. Ms. Warren told the New England Council last year, “I am a capitalist to my bones.” She then told CNBC, “I am a capitalist. Come on. I believe in markets.” It was almost as if she didn’t believe it herself. Then came the caveat: “But only fair markets, markets with rules. Markets without rules is about the rich take it all, it’s about the powerful get all of it. And that’s what’s gone wrong in America.” She clearly doesn’t understand capitalism.

Neither does Mr. Neumann, who said of WeWork, “We are making a capitalist kibbutz.” Talk about mixed metaphors. In Israel, a kibbutz is often defined as “a collective community, traditionally based in agriculture.” WeWork’s prospectus for its initial public offering mentioned the word “community” 150 times. Yet one little secret of kibbutzim is that many of them hired outsiders to do menial jobs that the “community” wouldn’t do, similar to migrant workers on U.S. farms. A capitalist kibbutz is a plain old farm, much like a WeWork building is plain old shared office space. Big deal.

Ms. Warren wants to reshape capitalism, while Mr. Neumann wants to “revolutionize your workspace.” Meanwhile, the Vision Fund, with capital from SoftBank and Saudi Arabia’s Public Investment Fund, has thrown good money after bad, writing off $9.2 billion in its quest toward this WeWork revolution. The same mismatch between communitarian vision and market realities would doom Ms. Warren’s economic reshaping. It’s hard to repeal good old capitalism.

The commonalities go on. Last year, Ms. Warren proposed the Accountable Capitalism Act. If it became law, large companies would have to obtain a federal charter that “obligates company directors to consider the interests of all corporate stakeholders,” or dare I say, community. For each company, Ms. Warren insists that “40% of its directors are selected by the corporation’s employees.” Back to the kibbutz?

In six months in 2019, WeWork lost $1.4 billion on $1.5 billion in revenue. Impressive! Its planned IPO tried to focus investors’ attention on other metrics. I’m always suspicious when anyone uses the “adjusted” measures in a financial statement (Hollywood is famous for this). But WeWork took it to a new level, spouting nonsensical things like, “Annual Average Membership and Service Revenue per Physical Member.” And “Location Contribution.” My favorite: “Community Adjusted Ebitda,” meaning they magically remove all “building- and community-level operating expenses”—you know, little things like rent, utilities and staff salaries—so they could show a profit.

Ms. Warren’s Medicare for All plan is from the same school of financial engineering and dishonest accounting. The financing looks like it was done by an overworked intern with a spreadsheet, torturing the numbers until they got to where Ms. Warren wanted them. The declared cost is $20.5 trillion over a decade. But a little digging shows it’s filled with squirrelly assumptions, double counting of savings and other tricks. The real cost could be closer to $60 trillion, according to the Heartland Institute.

The plans of both “visionaries” also depend on snatching money from investors—whether by force or mild deception. Ms. Warren has proposed a wealth tax, or as she tweeted, “I’m calling it the ‘Ultra-Millionaire Tax’ & it applies to that tippy top 0.1%.” It’s basically a plan to transfer wealth from the “rich & powerful” and “richest Americans” to the middle class. She tweeted to investor

Leon Cooperman,

“Now why don’t you pitch in a bit more.”


Vision Fund had to pay $1.7 billion to Mr. Neumann to go away, so now he’s part of the tippy top. Wags on


noted that this was an ironic transfer of wealth from Saudi Arabia to an Israeli entrepreneur.

Other similarities? Mr. Neumann once said, “If you are open-minded and you let the universe come in, you never know where things might go.” That doesn’t mean anything—much like what Ms. Warren wrote in her book: “For capitalism to work, we all need one another.” And there’s that community thing again. Ms. Warren even got her community of supporters to show up in New York’s Washington Square Park and take hours of “selfies” with her (though actually a campaign aide took the photos). Mr. Neumann, on the other hand, was selflessly licensing the trademark “We” to his “community” for only $5.9 million.

There is one glaring difference: Mr. Neumann famously banned meat in WeWork cafeterias. This means they probably don’t serve Ms. Warren’s culturally appropriated (or is it culturally confused?) oriental beef stir-fry from the “Pow Wow Chow” cookbook.

Both Ms. Warren and Mr. Neumann wanted to realize their dreams not on any sound economic principles, but instead on a stolen checkbook. He had a bottomless line on money from SoftBank and Saudi Arabia. She sees a bottomless pit of dollars from U.S. taxpayers. I think it’s fair to declare Liz Warren the WeWork candidate.

Write to kessler@wsj.com.

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