Elon Musk's Twitter deal offers so many strong arguments for taxing billionaires

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Twitter announced its sale to Elon Musk on Monday, and there’s been at least a week’s worth of drama since. Large numbers of existing users left Twitter, while right-wing accounts gained followers as their supporters apparently joined the site. Tesla’s stock dropped by more than $100 billion—kind of a problem for Musk since he put up Tesla shares as collateral for his Twitter purchase.

The specifics of the deal became public on Tuesday, including a $1 billion termination fee if either party pulls out. If the deal doesn’t close by Oct. 24, both sides can walk away, or, if there’s a regulatory delay, they can extend for six months. But while “It’s actually a pretty plain vanilla merger agreement,” according to an expert quoted in The New York Times, the drama surrounding it is decidedly not vanilla.

Even without the drop in Tesla’s stock, there was some reason for concern about the financial details of the purchase:

Musk is taking on $25 billion in debt financing to acquire Twitter, at an avg interest rate of between 4.5-5%. That means Twitter’s going to have to pay $1.15-$1.3 billion a year in interest alone, which is more than it made before interest and taxes last year.

— James Surowiecki (@JamesSurowiecki) April 26, 2022

It makes you wonder how Musk plans to make this work. Does he think he’s just getting a $44 billion toy, a piece of conspicuous consumption even more impressive than owning a really big yacht? Or does he have a plan to wring more money out of the platform than its current or past executives have been able to do?

However he plans to make it work on a financial level, Musk is throwing up red flags about how it will work for users and current Twitter employees. On Tuesday, Musk targeted two Twitter executives in his own tweets, in both cases piggybacking on attacks on the executives by right-wing media figures seeking Musk’s attention. As a result of Musk’s criticism of Vijaya Gadde, one of Twitter’s top lawyers in charge of trust and safety and legal and public policy, Gadde’s mentions filled with abuse, including overt racism. Musk also responded to a tweet by Pizzagate conspiracy theorist Mike Cernovich, saying “Sounds pretty bad” in response to Cernovich’s attack on a different Twitter executive.

It didn’t take Musk long to bolster concerns that he would run Twitter in service to the far right, in other words, and enable abuses.

But we already knew that. Popular Info’s Judd Legum has detailed how Musk’s commitment to free speech is situational and self-serving, including Musk’s attacks on journalists who’ve criticized Tesla, Musk’s threats to Tesla workers who’ve discussed unionizing, and Tesla’s ask to the Chinese government to censor criticism of its products. Musk’s idea of free speech is all about punching down and dogpiling, but stops abruptly when his own interests are involved.

About the China thing, too: Another billionaire with too much power weighed in with a concern about Musk’s purchase of Twitter:

Interesting question. Did the Chinese government just gain a bit of leverage over the town square? https://t.co/jTiEnabP6T

— Jeff Bezos (@JeffBezos) April 25, 2022

No one really knows what the worst-case scenario for an Elon Musk-owned Twitter looks like. But the best-case scenario here may just be that he wreaks havoc with poorly thought-out tweets and ones outright encouraging abuse, then loses interest before the sale ever becomes final. Whatever happens, it’s guaranteed to be a continuing advertisement for taxing the rich a helluva lot more.

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Posted in Independent News