Twitter’s Hostile Makeover

The secret weapon that may surmount the Twitter threat: the free market
April 15, 2022 Updated: April 21, 2022

Commentary

When you storm out of a store in disgust at exorbitant prices or shabby service and vow not to give the establishment your patronage ever again, does that mean you hate capitalism? Far from it—any more than when you storm out of the Department of Motor Vehicles (DMV) for the same reasons; the difference, of course, is that in the case of the moody bureaucrats the state employs to process your driver’s license, who might have to try to burn the building down before their jobs would be in jeopardy and who have little reason to care about customer satisfaction, you can’t go down the road and take your business elsewhere.

Until mega-billionaire Elon Musk stepped into the fray, Twitter was looking a lot like the DMV—with the other major social communications platforms, such as YouTube and Facebook, not far behind. A functionary decides you’ve violated the rules and you’re at the mercy of the powers that be, with perhaps months of begging required before your issue is resolved, if they even deign to do so at all. And when it comes to social media, it isn’t your car’s registration or insurance at issue but a key means of exercising free speech in the 21st century.

Of course, there are competitors to Twitter, such as Parler and former President Donald Trump’s new Truth Social, but it’s in the nature of online services to be able to hang on to heavy consumer dominance, and Twitter long ago became king in individuals propagating potent opinions, particularly when it comes to the famous and the powerful all over the world. If you switch elsewhere in disgust at Twitter’s canceling of, say, Trump, Parler is not going to be filling you in on Lady Gaga’s latest musings—or the Pope’s, for that matter.

Express doubt about the results of the 2020 election and YouTube may rescind your posting privileges. Meanwhile, just this week it was discovered that YouTube never touched the pro-violence, racist video screeds of the New York City subway shooter who just wounded at least 10.

The fastest and maybe the only way to fix social media platforms that are suppressing the opinions of their users is to do it from the inside—as Musk obviously concluded.

After buying up a massive 9.2 percent of the firm with $3 billion, in the aftermath of which he was offered a spot on the company’s board, Musk shrewdly declined the seat, knowing that board membership would restrict him under law from being able to purchase more than 14 percent of Twitter. Now he has pivoted, and he’s seeking to buy all the company stock at a price-per-share nearly 40 percent above the value of the firm before his purchase earlier this month.

Beautiful to behold, this is a case of using the free market to solve a big problem facing free society—in this case, the problem being a threat to representative government itself. Twitter has already played a destructive role in both the 2016 and 2020 presidential elections, first in favoring postings of ludicrous conspiracy theories about Russian influence on then-candidate Trump, then suppressing the Hunter Biden story, which, had it gained enough traction, could have meant Trump defeating then-candidate Joe Biden, who is now the president.

Musk means to convert Twitter into a private company and, considering his well-known tenacity, it’s a good bet he’ll succeed. Twitter’s reputation is already bruised, it having embittered a large proportion of the electorate, especially when it suspended Trump last year, apparently permanently. Fighting Musk would prove to the world that Twitter is all about exercising power rather than empowering its users. Such a battle would likely take a serious toll on its stock price and might end with Musk selling off all his shares. Even board members who don’t believe this will see an unpredictable future ahead for the company, whose brand has been battered by its adherence to its own unfair rules. How can they resist taking Musk’s sure money rather than crossing their fingers and hoping for the best? It might be the most morally motivated case of the much-maligned practice of hostile takeover in history.

When Mitt Romney ran for president in 2012, he was slammed for having run a very successful private equity firm, Bain Capital. But such firms are far from being exploitative robber barons; they perform an invaluable service in the economy and ultimately save companies and the salaries and livelihoods they provide. With their expertise, they conduct the very complex legal task of converting a public company, restricted by mounds of onerous regulations, into a private company. Under that altered status, major problems can be fixed over a reasonable period of time. After that, the firm can go public again if ownership wants the influx of capital that comes with the selling of numerous public shares. Bain did this for firms ranging from HCA Healthcare to Dunkin Donuts—companies that survived and thrived to continue employing hundreds of thousands today.

Musk’s move is reminiscent of conservative international media mogul Rupert Murdoch’s aggressive purchase of The Wall Street Journal and Dow Jones a decade and a half ago from longtime owners the Bancrofts. After he offered to buy at a price significantly higher than the market value, members of the Bancroft family hemmed and hawed, requesting more money plus editorial conditions. Murdoch’s response was to hit back hard, paint the prospective sellers’ demands as unreasonable and the price he was offering as generous. It took very little time before the Bancrofts relented and signed on the dotted line. In the years since, it has been surprising to see the restraint the Murdoch family has practiced in its management of the news side of the Journal. On the opinion side, the restraint was even more pronounced, with editor Paul Gigot, successor to the esteemed Bob Bartley, and his writing team kept fully intact and free to expound their market-friendly brand of conservatism, which has sometimes tartly criticized Trump.

Musk seems to be about to prove himself a heavyweight in the multi-billion-dollar high tech marketplace, far above even his biggest fans’ expectations. In addition, if he gets his way on Twitter, it will prove that it’s the market that’s the solution to some of the biggest new problems of the online age. A multi-billionaire entrepreneur can play David and beat Silicon Valley’s censorship Goliath.

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.

Thomas McArdle was a White House speechwriter for President George W. Bush and writes for IssuesInsights.com