Trump’s toxic influence over Oracle-TikTok deal

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And yet – and this is the part I find astounding – nobody even blinks. “Oracle’s courting of Trump may help it land TikTok’s business and coveted user data,” read the headline in the Washington Post the other day, as if this were the most normal thing in the world. According to the Wall Street Journal, several ByteDance investors in Silicon Valley “went in search of a tech company with close ties to the administration”- knowing that a company that Trump favoured had perhaps the only chance of succeeding. Again, this was reported as if it were unremarkable.

At this point, nobody expects the Republicans in Congress to object seriously to anything Trump does, no matter how awful, although a group of GOP senators sent a letter to the administration on Wednesday expressing their concerns. But even Democrats have raised few objections to the Oracle deal. Experts on authoritarian regimes often talk about how people gradually become accustomed to government practices that should, by all rights, horrify them. The reaction to the Oracle-TikTok deal would suggest that is happening here.

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Even before Oracle entered the arena, Trump’s moves against TikTok were – or should have been – unacceptable. In July, Trump first suggested a TikTok ban as a way of punishing China for what he called its role in spreading the coronavirus. A few weeks later, when he issued an executive order calling for the popular app to be banned by September 15, his rationale was national security: TikTok “threatens to allow the Chinese Communist Party access to Americans’ personal and proprietary information,” which, he claimed, might give China the ability to blackmail federal employees.

Even if this were true – and there are many doubters – a ban was hardly an appropriate response from an American president. As Wired put it, “Outlawing TikTok would … mean the US would be participating in the same Chinese-style internet-sovereignty tactics it has long criticised.”

As companies circled TikTok, hoping to keep it alive in the US by buying it outright from ByteDance, China struck back. It issued new export control rules that outlawed the export of certain technologies that TikTok used. That’s the kind of arbitrary move you expect from the Chinese. When TikTok’s primary suitor, Microsoft, proposed a deal that would have satisfied the Trump administration’s concerns – it was going to buy TikTok outright, which would have given it control of its algorithms – ByteDance turned it down. It didn’t have much choice.

Oracle’s co-founder and chairman Larry Ellison has conducted fundraisers for Trump’s re-election campaign and its chief executive, Safra Catz, has been a significant donor to the campaign and was a member of the Trump transition team in 2016.

Oracle’s co-founder and chairman Larry Ellison has conducted fundraisers for Trump’s re-election campaign and its chief executive, Safra Catz, has been a significant donor to the campaign and was a member of the Trump transition team in 2016.Credit:AP

Oracle, of course, is not buying TikTok. It will not take control of its algorithms. Its label is going to be TikTok’s “trusted technology partner.” The deal has been submitted to the Treasury Department for review, with both companies saying that it will “resolve the administration’s security concerns,” as TikTok said in a statement. But who knows?

The bet Oracle and TikTok are making – and a very cynical wager at that – is that Ellison and Catz’s long-standing support of Trump will cause the president to forget about his supposed national security concerns and allow TikTok to continue operating in the US pretty much the same as it had before this whole dust-up began. It seems pretty likely that is what will happen. “I have a high respect for Larry Ellison,” Trump told reporters on Tuesday. “He’s really a terrific guy.”

With Trump, that’s pretty much all you need to know.

Joe Nocera is a Bloomberg Opinion columnist covering business. He has written business columns for Esquire, GQ and the New York Times, and is the former editorial director of Fortune. His latest project is the Bloomberg-Wondery podcast ‘The Shrink Next Door.’

Bloomberg

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