melon Musk has now put together a $46.5 billion financing package to buy Twitter, two-thirds of his own assets and one-third of bank loans secured by Twitter assets. It is the largest acquisition financing ever proposed for an individual.
Twitter’s founder and top managers don’t want Musk to take over the company. He was offered a seat on the board, but he didn’t want it because he would have to be accountable to all the other shareholders. Now they are taking a “poison pill” to stop it. But Musk plans to buy shares outright with a public offer that shareholders can’t refuse. After all, it is a free market.
Musk says no one should oppose what he wants to do with Twitter because he’s a “free speech absolutist” and who can be against free speech? In addition, he and his supporters say that if consumers don’t like what he’s doing with Twitter, they can go elsewhere. Freedom to choose.
Free market? Freedom of expression? Free choice?
When billionaires like Musk justify their motives using the word “freedom,” beware. What they really seek is freedom from responsibility. They want to use their vast fortunes to do as they please, unfettered by laws or regulations, shareholders, or even consumers.
The “free market” increasingly reflects the demands of big money. Unfriendly takeovers, like the one Musk is mounting on Twitter, weren’t part of the “free market” until the late 1970s and early 1980s. Before then, laws and regulations restricted them. Then came corporate raiders like Carl Icahn and Michael Milken. Their modus operandi was to find corporations whose assets were worth more than the value of their shares, borrow against them, buy enough stock to force them to cut costs (such as laying off workers, leaving their communities, busting unions, and taking on crushing debt), and collect. .
But the raiders’ antics often imposed huge social costs. They pushed America from shareholder capitalism (where workers and communities had a say in what corporations did) to shareholder capitalism (where the sole corporate goal is to maximize shareholder value). Inequality soared, insecurity soared, vast swaths of America were abandoned, and millions of good jobs disappeared.
The raiders tampered with the “free market” to allow them to do this. That’s what the super rich do. There is no “free market” in nature. The “free market” depends on laws and rules. If you have enough money, you can buy changes to those laws and rules that will earn you even more money. (You can also get the government to subsidize it: Musk has received $4.9 billion so far.)
“Freedom of expression” is another freedom that revolves around wealth. As a practical matter, your ability to be heard depends on the size of megaphone you can afford. If you are extremely rich, you can buy the Washington Post or Fox News. If you’re the richest person in the world, you can buy one of the world’s biggest megaphones called Twitter, and then decide who can use it, what its algorithms will be, and how it invites or filters big lies. .
Musk said last week that he doesn’t care about the economics of the deal and is pursuing it because it is “extremely important to the future of civilization.” Fine, but who anointed Musk to decide the future of civilization?
Which brings us to free choice. If consumers don’t like what Musk is doing with Twitter, can not just switch to another platform similar to Twitter. There are none. The biggest social media platforms have become giants because anyone who wants to participate in them and influence the debate needs to join them. After they reach a certain size, they are the only megaphone in town. Where else would consumers go to post short messages that can reach tens of millions of people besides Twitter?
With social networks, the ordinary rules of competition do not apply. Once a platform is dominant, it becomes even more dominant. As Donald Trump discovered with his “Truth Social” fiasco, upstarts don’t stand much of a chance.
Musk’s real goal has nothing to do with the freedom of others. His goal is his own unrestricted freedom, the freedom to wield enormous power without being accountable to laws and regulations, shareholders, or market competition, which is why he is determined to own Twitter.
Unlike his ambitions to change interstellar transportation and flight, this one is dangerous. It could well upset democracy.