Musk’s Twitter Buy Makes No Sense – Unless It’s Part of Something Bigger
Brexit and Trump were initially seen as jokes, but the new owner of the social media giant could pose a serious threat to democracy – and a boon for Vladimir Putin, writes David Troy
Ever since Elon Musk, CEO of Tesla and SpaceX, plunged the world into an endless stream of speculation and condemnation around his purchase of Twitter, the biggest unanswered question has been: why?
For many, his ultimate goals seem to be a mystery. As someone who has followed the company and its role in information warfare closely, I believe we need to use a different set of lenses to evaluate what’s happening.
First, it’s not a very attractive business, and it probably isn’t worth what Musk paid for it based on business metrics alone. He will struggle to service the debt payments associated with it, and he could try to improve profitability by slashing headcount and charging for services like Twitter Blue (which will provide a verified “checkmark” but may not include identity verification). That subscription feature may generate around $100 million a year if it has high uptake — nothing compared to the company’s $3.7bn in 2021 revenues.
It’s also important to realise that co-founder and former CEO Jack Dorsey endorsed Musk’s takeover bid. Why? Dorsey actually believes Twitter never should have been a company, but rather a foundational protocol on which a Twitter-like service could be built for the benefit of all — rather like the foundational Internet protocols that have enabled the web and email. Dorsey retained his shares in Musk’s Twitter; he said in April, “Elon is the singular solution I trust,” and he seems to be standing by that assessment.
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Twitter cost Musk and his consortium of investors about $44 billion — denominated in United States dollars. That seems like quite a lot to pay. However, just as home mortgage payments get less expensive in real terms as time goes on, if you had a high degree of confidence that the value of a dollar would go down, perhaps dramatically, you might not care very much about price — especially if you thought your new asset could help you devalue the dollar.
Looking closer at the biggest investors (among them Musk, Saudi Prince Alwaleed bin Talal bin Abdulaziz, Qatar, and Dorsey), all of them have an interest in challenging the US dollar. Musk and Dorsey are major Bitcoin fanatics, and believe it’s the future of money. Saudi Arabia and Qatar have expressed interest in displacing the dollar as the world’s reserve currency. It is a peculiar characteristic of the investor list that all of them are interested in displacing the dollar.
Of course, this strategy is also one favoured by Vladimir Putin. His disastrous war in Ukraine is about more than territorial gains — it’s also a challenge to the West and what he perceives as unreasonable Western hegemony. He intends to organise the BRICS countries (Brazil, Russia, India, China, and South Africa, and others) into a unified economic bloc rooted in asset-backed currencies such as metals-backed crypto tokens, with Bitcoin and other cryptocurrencies as a bridge. This may be accelerated if the United States defaults on its debt in January, sparking a global financial crisis — an increasingly likely possibility.
Instead of looking at Musk as a “businessman” who’s trying to make money in the old system of fiat currency, advertising, and revenues, perhaps he’s actually an ideologue looking to drag the whole world through a transition into a new economy. Then, his actions begin to make more sense.
A New Financial Regime
If Musk’s Twitter purchase price seemed inflated based on legacy metrics, ask instead: what is it worth to him, Putin, and his investors to shift the world into a new financial regime? It’s obviously infinitely valuable. This was why I had high confidence the deal would happen — if this was the goal, then any price is worth the cost.
In the 1930s, when a group of gold bugs tried to overthrow Franklin Delano Roosevelt to restore the gold standard (the so-called “Business Plot” of 1933-34), Robert Sterling Clark of the Singer sewing machine family told General Smedley Butler, the Marine veteran they had targeted to execute the plot, that “he had $30 million, and he was willing to spend half of the $30 million to save the other half.”
To people obsessed with hard currencies, fiat currency from central banks isn’t real: it’s play money to be used in the service of winning a game.
Musk’s friends, specifically Peter Thiel, David Sacks, and Rod D. Martin, have been trying to replace the dollar since their days at PayPal. Former PayPal COO David Sacks said, in 2017, “Bitcoin is fulfilling PayPal’s original vision to create a ‘new world currency.’” PayPal co-founder Luke Nosek confirmed in 2019, “The initial mission of PayPal was to create a global currency that was independent of interference by … corrupt cartels of banks and governments that were debasing their currencies.” Sacks has been playing an especially vocal role in recent weeks in amplifying Kremlin messaging, suggesting that Ukraine should capitulate to avoid nuclear war.
Musk and his “new world currency” crew are aiming to usher in a new “multipolar order,” which was the subject of Putin’s recent talk at the Valdai Discussion Club. And the alignment of the PayPal mafia with Putin means they have at least the verbal threat of Russia’s nukes to back their agenda.
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Patriarchy & Power
Musk is aligned with Putin in other important ways. Both have been heavily promoting traditionalism, hierarchy, and patriarchy.
As Putin decries multiple genders and homosexuality, Musk asks advertisers to reject “political correctness” in favour of “free speech.” Where democracy tends to flatten societies and equalise opportunities for all, autocracy tends to emphasise hierarchy and wealth. Musk, as the world’s richest man, has come to believe he embodies the peak of such a hierarchy, and seems to seek to impose it on others.
Where Putin has become enamoured with the concept of the “Noosphere,” or the idea that the earth should evolve into a “conscious” planet, placing people in the role of neurons, Musk has been echoing similar concepts — going so far as to call Twitter a “collective cybernetic super-intelligence.”
The bet from both of them, whether cynically or in good faith, is that Earth is evolving past the era of sovereign nation-states and towards some new phase of being rooted in “Noocracy,” or “rule by the wise” — where Putin and Musk are “the wise.”
The recent takeovers of CNN and HBO have prompted similar questions about why they were targeted for purchase, and the changes being made there. None of these moves makes very much sense if you’re looking backwards at the world as we have known it. But if we look forward to the world as it might be, it’s possible to glimpse the reasoning: these information channels can actually help usher in a different world. To most of us, that’s inconceivable; the world doesn’t just change overnight.
But to Musk, Putin, and their free-market absolutist collaborators, that’s exactly what they intend to effect. If we aren’t aligned with these potential changes, now is the time to stop laughing at their presumed incompetence and instead deeply understand what they are really up to.
And there’s the matter of “X,” Musk’s proposed “everything app.” It’s been floated as a response to WeChat, China’s ubiquitous app, that’s come to dominate both payments and the social sphere. Supposing such an app starts to take on the task of “voting” around controversial topics. At what point does this start to challenge the legitimacy of elected governments? This is something Musk is likely to explore.
Just as many laughed at Brexit and Trump in 2016 as preposterous jokes, many are laughing now at Musk, suggesting that he’s “mismanaging” Twitter and that it will end up being taught in business schools as a case study in failure.
In fact, it is likely to end up being taught in history classes as an example of totalitarian information warfare, and if we don’t arrest and reverse our current trajectory, we may also experience the worst effects of such a program, including genocide and bloody kinetic war. None of this is a joke, none of the old rules apply, and we would be well-advised to treat this as the threat it really represents.
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