A deal for the world’s wealthiest person to purchase social media company Twitter for $44bn has raised alarms over the concentration of billionaire power across social media platforms and how they will be used to shape both public policy and the economic interests of the people running them.
Elon Musk’s massive purchase has also revived calls from members of Congress and other critics to demand that US billionaires pay higher taxes, while questioning Mr Musk’s public and self interests in spending that much money to control the platform.
“Tax the rich,” said Democratic US Rep Pramila Jayapal. “It’s absurd that one person can afford to buy Twitter for more than [$44bn] while working families across this country have to choose every day between buying groceries or their prescription drugs.”
Massachusetts Democratic Senator Elizabeth Warren, who has frequently sparred with Mr Musk over his tax obligations, called the deal “dangerous for our democracy.”
“Billionaires like Elon Musk play by a different set of rules than everyone else, accumulating power for their own gain. We need a wealth tax and strong rules to hold Big Tech accountable,” she said.
While Twitter has a relatively smaller footprint than Facebook and Instagram, which have billions of daily users, it has an outsized influence in political discourse and media, and a prolific and toxic mix of disinformation and harassment that has plagued many platforms.
In a statement announcing the deal, Mr Musk said that “free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated.”
“Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it,” he said.
Chuck Collins with the Institute for Policy Studies said in a statement to The Independent that “we should be alarmed and concerned that the wealthiest person on the planet is buying the town square of social media.”
“The difference between an entrepreneur and an oligarch is that an oligarch deploys their wealth to acquire media and capture political systems to advance their own wealth, power and influence,” he said. “While there have always been plutocratic owners of media, going back to Hearst and Pulitzer, the 2022 levels of concentration of wealth and power have created a class of billionaires with considerable power to shape and warp democratic discourse and economic policy.”
Anthony D Romero, executive director of the American Civil Liberties Union, acknowledged that Mr Musk is a “card-carrying” supporter of the organisation, but said that “there’s a lot of danger having so much power in the hands of any one individual.”
“In today’s world, a small handful of private tech companies – including Twitter – play a profound and unique role in enabling our right to express ourselves online,” he said in a statement. “Social media is a critical tool used to share ideas, express opinions, and consume information that has real-life impacts in discourse in the offline world. We should be worried about any powerful central actor, whether it’s a government or any wealthy individual – even if it’s an ACLU member – having so much control over the boundaries of our political speech online.”
On 25 April, White House press secretary Jen Psaki, when asked for a response to Mr Musk’s purchase, said that she is “not going to comment on a specific transition” but reiterated that President Joe Biden’s administration continues to believe that “no matter who owns or runs Twitter, the president has long been concerned about the power of large social media platforms” and stressed that “tech platforms must be held accountable for the harms they cause.”
She pointed to bipartisan interest in Congress for antitrust measures and reforming section 230 of the Communications Decency Act.
Asked whether the White House has concerns about the spread of election-related dis- and misinformation and concentrated billionaire control of social media platforms, Ms Psaki said the administration has “long talked about, and the president has long talked about, the powers of social media platforms … to spread misinformation, disinformation [and] the need for these platforms to be held accountable.”
It remains unclear whether Mr Musk intends to revoke the kinds of policies that Twitter has implemented to curb certain forms of harassment and misinformation, though he has long bristled at censored posts in the name of “free speech” and gained the praise of right-wing figures and Republican officials who have criticised the company for blocking disinformation and hate speech.
“I am hopeful that Elon Musk will help rein in Big Tech’s history of censoring users that have a different viewpoint,” said Republican Senator Marsha Blackburn of Tennessee.
Far-right Georgia congresswoman Marjorie Taylor Greene, whose personal account was suspended for repeatedly violating the platform’s Covid-19 misinformation policies, said “blue check mark” users – referring to verified liberal users and members of the press that conservatives deride as “blue checks” – will have a “meltdown” after Mr Musk “seals the deal and I should get my personal Twitter account restored.”
Women’s advocacy organisation Ultraviolet warned that Mr Musk could “rip open Pandora’s box and reopen the floodgates for hate and baseless conspiracy theories” to proliferate on the platform, following right-wing outrage that the platform has censored or removed accounts for amplifying Covid-19 misinformation, hate speech and other forms of abuse.
“Without any conditions for Musk to purchase Twitter, the platform’s community standards and recourse to ban users who violate those standards, Twitter could set a dangerous precedent for other social media companies to follow,” the group’s communications director Bridget Todd said in a statement. “This is a massively slippery slope.”
The purchase has also stirred debate over the moral obligations and responsibilities with holding that much cash, more than 14 times what New York City’s Department of Homeless Services spent in 2021.
While Mr Musk has said that he has paid more federal taxes than anyone, to the tune of $11bn for 2021, his company Tesla paid nothing in federal taxes for that year.
A ProPublica investigation found that Mr Musk paid no federal income tax in 2018; he paid a 3.27 per cent true tax rate, or $455m, for his wealth growth of $13.9bn over the five-year period between 2014 and 2018.
That’s compared to the average single US worker earning $45,000 who pays on average a tax rate of 21 per cent.
In 2018, the highest top rate on ordinary income was 37 per cent, while the average tax rate for the 400 wealthiest people in the US was 22 per cent between 2013 and 2018, according to ProPublica.
While his taxable income during that five-year period was $1.52bn, he did not pay any federal income taxes in 2018, according to the report.
Over the course of the Covid-19 pandemic, Mr Musk’s wealth soared from $24bn to more than $2736bn.
Mr Musk – with an estimated net worth of $273.6bn as of 14 April – has been on the Forbes list of global billionaires for a decade, with his massive wealth attributed to soaring and volatile Tesla stock.
In 2012, when he debuted on the Forbes list, his net worth was estimated to be $2bn. Mr Musk now is estimated to be $68bn richer than just one year ago.
Last month, President Biden proposed a minimum tax on American households worth more than $10m, which would pay a 20 per cent tax rate on income as well as unrealised gains tied to other assets, such as stocks and bonds, which are not currently taxed until they are sold off.
The president said one-hundredth of one per cent of Americans would be subjected to the tax, which he called “fair, and it raises $360bn that can be used to lower costs for families and cut the deficit”.
More than half the revenue raised would come from households worth more than $1bn.
That proposal could see Mr Musk with a tax bill of at least $50bn.
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