politics

Ex-Google CEO Eric Schmidt Says Story Alleging His Foundation Indirectly Paid White House Science Staffers Is ‘Largely False'

Christophe Morin/IP3 | Getty Images

Former Google CEO and chairman Eric Schmidt says a Politico report claiming his foundation "indirectly paid" the salaries of two White House science staffers is "largely false."

"When you legally and fairly work with [the government], all you do is get criticized," Schmidt told CNBC Make It in an exclusive interview on Tuesday.

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Schmidt, who helmed Google from 2001 to 2011, is the world's 66th-richest person with a net worth of $23.7 billion, according to Forbes. In the interview, he noted that his track record with the federal government is extensive: He served as a member of the President's Council of Advisors on Science and Technology from 2009 to 2017 under President Barack Obama, spent five years on the U.S. Department of Defense's Defense Innovation Advisory Board and was the chairman of the National Security Commission on Artificial Intelligence in 2018.

"You want people like me to do that," he said.

The Politico report, published on Monday, claimed that Schmidt's nonprofit Schmidt Futures influenced the White House's Office of Science and Technology Policy (OSTP) by temporarily paying the salaries of two OSTP employees. The White House office is responsible for developing and implementing science- and tech-related policies and budgets, and advises the president on similarly related domestic and international affairs.

Schmidt denied the report and detailed what was specifically wrong with the report in a statement released on Monday.

"The unsubstantiated thesis of the article is that there was undue influence over the department, which there was not," the statement said.

The statement added that Schmidt Futures has worked with OSTP in recent years and "have publicly acknowledged our contributions and support of private-public partnerships to support talent and advance scientific innovations for the betterment of society."

What's more, the U.S. government and OSTP have used pooled philanthropic funding to ensure staffing across agencies for over 25 years, said the report.

Schmidt said the criticism was a good example of why well-meaning people often don't want to work with government entities. "It's not worth it to get the abuse," he said. "And in this case, the abuse is false, and we'll address it."

According to Politico, Schmidt Futures indirectly paid the salary of current OSTP chief of staff Marc Aidinoff for six weeks. Additionally, the report said, Schmidt Futures chief innovation officer Tom Kalil remained on Schmidt's payroll for four months while ostensibly working as an unpaid consultant at the science office.

"Schmidt has long sought to influence federal science policy, dating back to his close ties to the Obama administration." Politico wrote, adding that some of Schmidt's financial interests — like the development of artificial intelligence and 5G technologies — overlap with the OSTP's responsibilities.

Politico sent the following statement to CNBC:

"This is a deeply reported story by Alex Thompson that was, in part, based on persistent ethical concerns raised by officials from the Office of Science and Technology Policy. Mr. Schmidt was contacted prior to publishing and given opportunity to provide comment as was Schmidt Futures. We stand by the reporting."

The OSTP did not immediately responded to CNBC Make It's request for comment, but an OSTP spokesperson defended the office's policies to Politico in a lengthy statement.

"You're trying to tell a story of agency capture — that one philanthropy has influence over policy outcomes," the spokesperson said. "And yet, OSTP is executing on an aggressive agenda to protect the civil rights of all Americans impacted by algorithmic discrimination in the use of artificial intelligence and automated systems, is working across government to gather data that will help ensure that government delivers services more equitably, and is evaluating the mental health harms caused by social media platforms. We are proud to be defined by our work."

Correction: This story has been updated to include Schmidt Futures statement released on Monday regarding the thesis of the Politico article.

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