SID GUPTA – NOVEMBER 18TH, 2022
EDITOR: FELIX ZHANG
A decade ago, Twitter’s future was looking bright. The company was benefiting from a flood of funding into the social-networking space, eventually leading to an IPO in 2013 that raised $1.8 billion.
Now the company is back in private hands. And they happen to be the hands of Elon Musk, the richest person in the world and one of the app’s most high-profile provocateurs.
But why has the news of Elon Musk buying Twitter created such widespread attention and alertness? What makes it different from other IT companies to send such a ripple of tension and uncertainty throughout the tech, political, and civil rights world?
It was in 2011 when Twitter showed its true power for a monumental social and cultural change. Twitter became an essential social media tool used during the Arab Spring, the wave of anti-government protests throughout Egypt, Libya and Tunisia. Protesters used the site to post reports and to organize. The Arab Spring, sometimes dubbed the Twitter revolution, shook regimes across the Arab world. Using the social media platform, massive demonstrations were mobilized across countries like Egypt, Libya, Jordan, Yemen and Syria. Using wide-scale online activism, the protesters used Twitter to organize and coordinate protests, and even helped dissidents get access to the Internet when their regimes tried to shut it down.
Twitter soon became a mainstream cultural phenomenon.
It’s a massive moment. Twitter has become a key place for people to debate, joke and pontificate in their own circles of politics, sports, tech, and finance. It’s also served as a platform that gives a voice to the voiceless, helping protesters organize and express themselves in repressed regimes around the world.
In recent years, however, Twitter and social media rivals like Facebook have been at the center of controversy over the distribution of fake news and misinformation, sometimes leading to bullying and violence. In 2016, Twitter was criticized for their role in letting prominent users like Donald Trump, who would win the U.S. presidential election that year, spread misleading information without consequence.
Over the next couple few years, analysts found correlations between President Trump’s voracious use of Twitter and various markets underscoring the cultural power of Twitter. Finally in 2021, Twitter permanently banned Trump over inflammatory comments the president made during the U.S. Capitol riots in January that the company said could lead to “further incitement of violence.”
While Twitter has faced a lot of heat in the past few years, its effect on the market economy and culture is undeniable. Tweets have gone from being benign musings about what you ate for breakfast, to small but powerful messages that influence stock price fluctuations, directly from the source. These tweets are coming from power players around the world, from the highest ranks of business and politics, delivering snippets of policy and information that traders use to decide when and what to buy and sell. In addition to its significant financial influence, there are plenty of examples of the weaponization of Twitter. Before he was banned, Donald Trump used to go after his political opponents via tweets, but it was more than that. He also regularly announced new government policies via Twitter which had delineating effects on the economy. Recent history shows that even though Twitter allows information to be disseminated more quickly, the real-life benefits of taking the time to digest a tweet rather than react to it immediately is where the real value lies.
We may never know exactly why Elon Musk, the world’s richest man and wildly disruptive narcissist, was thinking when he sent out a tweet in early August that ended up costing him, and his company Tesla, $40 million USD. In it, he suggested he had secured funding to be able to take Tesla, a publicly-traded company, private for $420 USD a share, which was significantly more than where Tesla stock was trading at the time. The Securities and Exchange Commission wasn’t amused by the nearly 9 percent jump in Tesla’s stock price, presumably caused by that one tweet. It’s difficult to attach an economic domino effect to a single catalyst, but there are rules about the kind of information heads of companies aren’t allowed to share in the public sphere. In a settlement reached this week, Musk must pay a $20 million fine and step down as Tesla’s chairman for three years, though he can stay on as CEO. Tesla, the company, must also pay a $20 million fine for failing to keep their commander-in-chief’s tweets from causing confusion and spreading lies (or jokes, depending on who you ask). Incidentally, Tesla stocks rebounded after the SEC ruling.
“As thoughtless and as trivial as Elon Musk may have felt the tweet was, it had extraordinary real-world impact on the market and he’s paying for it,” says Matt Fullbrook, who is an expert on governance as the manager of the Clarkson Centre for Board Effectiveness at the University of Toronto.
After months of confusion, mixed signals, and attempted withdrawal from the deal, on October 28, Elon Musk sent out a tweet that said “the bird is freed”, alluding to the completion of the deal to buy Twitter. Is the bird really free though?
Musk claims this whole journey is a noble undertaking to make the platform a beacon for free speech. In a note to Twitter’s advertisers that he posted on Thursday, Musk described the takeover as a philanthropic venture designed to “help humanity, whom I love.” Repeating some of the themes that he has raised since launching the takeover bid, back in April, he also wrote, “The reason I acquired Twitter is because it is important to the future of civilization to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence”.
On the face of it, this sounded like a commendable statement. In actuality, though, the phrase “common digital town square” is an oxymoron, which suggests that he either doesn’t understand what he is getting into or is being disingenuous. Standing on a soapbox in a town square, the delirious ranter, or even the genuine prophet, can reach a few hundred people. Twitter is a global communications platform, on which celebrities—including Musk himself—can reach tens of millions of people; where online mobs (some of them carefully orchestrated) can target individuals relentlessly; and where bad actors, such as political extremists, terrorists, and rogue intelligence agencies, can plant misinformation to sow hatred and violence.
In terms of human history, social-media platforms represent something radically new, and we are still learning about the impact that they have on people’s cognitive-processing abilities, emotions, and behavior. But if the events of the past decade—including the U.S. elections of 2016 and 2020, along with the pandemic—have taught us anything, it’s that these platforms can potentially be destructive of truth, democracy, and the very humanity that Musk claims to hold dear.
In his message to advertisers, he did implicitly acknowledge some of these dangers, writing, “Twitter obviously cannot become a free-for-all hellscape, where anything can be said with no consequences! In addition to adhering to the laws of the land, our platform must be warm and welcoming to all, where you can choose your desired experience according to your preferences, just as you choose, for example, to see movies or play video games ranging from all ages to mature.” Musk attempts to put this in a way that sounds user-friendly, but what does this passage mean in practical terms?
In recent years, all the big social-media companies, Twitter included, have, under public pressure, invested in content-moderation policies, which employ artificial-intelligence programs and actual humans to search out posts and users that violate the platforms’ terms-of-service agreements. On paper, Twitter’s rules are quite strict. They say that users can’t use the platform to “threaten violence against an individual or a group of people,” nor promote the “glorification of violence,” nor “promote terrorism or violent extremism,” nor “encourage suicide or self-harm”, and so on.
It was on the basis of these rules that Twitter, two days after the January 6th assault on the Capitol by supporters of Donald Trump, issued a permanent ban to the former President’s account “due to the risk of further incitement of violence.” Musk’s insistence on “free speech” and his claims of “left bias” in Twitter policies have sparked concern that he would loosen content-moderation standards and let Trump back onto the platform. Such a move would likely be accompanied by the return of many other right-wing incendiaries and disinformation merchants. Yet, according to some reports, Musk has told prospective investors that he intends to slash Twitter’s workforce by nearly three-quarters. Already out the door are many of Twitter’s top executives through firings or resignations, with staffers and employees likely to follow. Although he reportedly denied that figure in a meeting with Twitter employees, there is obviously a danger that large job cuts would undermine the site’s ability to moderate its content.
Another important issue that he hasn’t addressed is whether there will be any changes in how Twitter deals with authoritarian countries that censor social media or mount disinformation campaigns on it; among the worst offenders are China and Russia, to whom Musk has business ties through his other companies. China is a major manufacturing center and product market for Tesla; Russia is an important source of raw materials used in the manufacture of electric cars, including lithium, aluminum, and nickel. Earlier this month, Musk tweeted out a peace proposal for Ukraine that included formally ceding Crimea to Russia. According to Ian Bremmer, the head of the Eurasia Group consulting firm, Musk told him that he had spoken to Vladimir Putin about Ukraine. (Musk subsequently denied this, saying that he had only spoken to Putin once, eighteen months ago, about space.)
Unfortunately, even the most optimistic case is that Musk, in downplaying the dangers of adopting a laissez-faire approach to content, is being naïve, or that, despite his public assurances, he isn’t operating in good faith. While he claims to be a political centrist and a responsible new owner of Twitter, some of his own tweets have targeted individuals for abuse or echoed right-wing memes. In 2018, he called a British diver who was involved in a rescue operation to save a group of Thai boys “pedo guy.” (In a subsequent court case, Musk apologized and was cleared of defamation). In April, 2020, during the initial coronavirus lockdowns, he tweeted, “FREE AMERICA NOW”. Earlier this year, he said that he had voted Republican for the first time, supporting Mayra Flores, a conservative Texas congresswoman who won a special election in June. He also said that he was leaning toward supporting Florida’s Republican governor, Ron DeSantis, in the 2024 presidential election.
What can we understand from all of this?
Elon Musk is an indefatigable self-promoter. He’s a billionaire but isn’t motivated primarily by money. Nor is he fueled by any larger purpose, principle, or ideology. His singular goal is to imprint his giant ego on everyone else — to exercise raw power over people.
His politics is neither conservative nor liberal. A better term to describe it would be megalomaniacal authoritarian. But why now — why does he achieve such prominence at this particular point in history? And why are so many enthralled with him?
The answer, I think, is that a large segment of the public projects its needs and fantasies on him. People who are “mad as hell and not going to take it any more” crave strongmen who shake up the system.
People who have been bullied their whole lives want to identify with super bullies who give the finger to the establishment, answerable to no one but their own ravenous egos. His arrogance and certitude attract millions of followers, fans, and cultish devotees, along with a fair number of goons and thugs, who want to vicariously feel superior. Everyone will do better when fewer of us feel so helpless and insecure that we’re drawn to reprehensible bullies who parade across the public stage as if possessing admirable qualities.
Twitter is at a turning point in its young life. As the world is still learning to live in a more connected age, Elon Musk’s Twitter has the chance to be an online place of civil discourse or democracy, or become a platform that spreads fear and misinformation. The fact that it’s up to a man like Elon Musk to see which it will become, leaves us with uncomfortable foreboding.
Featured Image Source: reuters.com
Disclaimer: The views published in this journal are those of the individual authors or speakers and do not necessarily reflect the position or policy of Berkeley Economic Review staff, the Undergraduate Economics Association, the UC Berkeley Economics Department and faculty, or the University of California, Berkeley in general.
