“When billionaires talk about freedom, watch your wallets” — a response to Robert Reich
Con artists operate in teams. Big cons need big capital
Tweet, tweet, the word on the street
Is the word on your phone, in your ear, at your feet.
Let freedom ring! For free, I sing!
Amassed fortunes, songs, and throngs accrete —
But that day may come when I might cheat,
If I wish. Will you know? Can you compete?
- Tom Tordillo
In case you hadn’t heard, Elon Musk is buying Twitter for $44 billion, the largest acquisition ever by a single individual.
Musk says no one should object to what he wants to do with Twitter because he’s a “free speech absolutist,” and who can be against free speech? Besides (he and his apologists say) if consumers don’t like what he does with Twitter, they can go elsewhere. Freedom to choose.
Robert Reich, When billionaires talk about freedom, watch your wallets
Robert Reich is one of my favorite pundits/economists. I still read with a critical eye. Can one sharpen a sharp critique even further? Maybe. At least, I’ll try.
Reich believes Musk’s agenda is to become free of accountability. Maybe.
Perhaps Musk amassed $40+ billion in cryptocurrencies and wants to liquidate his holdings. Buying an exceptionally public asset quickly enables liquidating and disposing of those assets — hiding the financing ‘in plain sight.’
Is some country struggling to access its foreign reserves? Say, during a war?
Musk’s acquisition might convert billions of dollars in crypto-currency held by Russian ‘affiliates’ — enabling new channels to convert their own crypto- holdings once their foreign funds dry up. Or, it could do anything else as well. We don’t know. We won’t know.
Financing transactions run to tens of thousands of pages of text — too much for anyone fixated upon tweets to follow. Big players move money the ways conductors move orchestras — they set the tempo. Someone else wrote the score.
Behind Musk’s fortune are bigger fortunes — BlackRock, with $10 TRILLION in assets under management, Goldman Sachs with $3 trillion in assets under management, and a host of others playing in that space. These are the composers of the scores.
When Musk buys a company, or expands Tesla, he goes to these folks — and together, they make stuff happen sometimes. But he does not control them. They are the greatest opportunities — and the biggest threats — to his fortune.
Musk’s real goal has nothing to do with the freedom of others. His goal is his own unconstrained freedom — the freedom to wield enormous power without having to be accountable to laws and regulations, to shareholders, or to market competition — which is why he’s dead set on owning Twitter.
- Robert Reich
Public opprobrium won’t scare Musk. Mean words from a senator or two? Nothing. Giant funds can buy the National Enquirer — or FoxNews — or the advertising on any other platform: they can orchestrate attacks upon his fortune the likes of which no politician could legislate.
Unless he owns a media platform of his own.
Billionaires like Musk (Twitter), Bezos (Washington Post), Bloomberg (Bloomberg News), Zuckerberg (Facebook/Meta) influence what the world sees, how it sees, where it looks to see.
The big funds can influence what is seen, and more importantly, what is not seen.
Consider: Tesla Corp is currently worth about $1 trillion in capital. In 2021, they made 930,422 cars.
Currently, the market cap for ten large automakers is
Toyota — $240 billion
Volkswagen — $100 billion
BYD - $100 billion (a Chinese automaker that also makes batteries…)
Mercedes Benz — $70 billion
Ford — $60 billion
General Motors — $55 billion
BMW — $50 billion
Honda — $45 billion
Ferrari — $40 billion
Hyundai — $40 billion
These automakers produce and sell more than 50 million cars per year. They employ millions of people. Tesla’s market cap exceeds all their capital PUT TOGETHER. To assume Tesla is worth more than all these others is to assume their engineers, marketing, production, distribution, etc. are not worth what Tesla’s is. That their governments will not back them better than they will back Tesla. To believe Tesla is worth more, one must believe in Musk’s…magic.
Assumptions like that can change overnight.
By owning Twitter, Musk might get wind of short-sellers and others attacking Tesla a bit faster, amplify ‘facts’ that challenge such attacks, de-amplify/de-platform threats. All subtly, so that nobody really sees it.
If Tesla proves to be another Enron, AIG, or other master-fraud, Musk might delay a feeding frenzy for a day or two — long enough to bail himself out (yes, the extremely wealthy design their fortunes so they can bail themselves out in in case of a collapse).
Personally, I see more probably of an ‘Ivar Kreuger’…very different sort of fraud, which unravels only in the face of a Great Depression scale disruption. In the end, perhaps the Ivar Kreugers of the world wind up holding themselves accountable for their schemes.
But lots of people were left starving after Kreuger cheated them.
