Economist Ike Brannon talks of a stretch in the 1980s when he worked as a professor down in Peru. Snack giant Nestle had a substantial business there by Peruvian standards, only for covetous government officials to secretly hatch a plan to expropriate the business.
Luckily Nestle received word of the government’s intended actions ahead of time, and quickly found a local buyer for the business. Knowing that the buyer had to be Peruvian, and that time was highly limited, Nestle sold its Peruvian franchise for a fraction of the price that it could have received in a free market, but at least it got something.
The mugging of Nestle decades ago naturally comes to mind as a disturbingly paranoid U.S. political class demands that Beijing-based TikTok owner ByteDance sell TikTok to a U.S. buyer within 180 days, or face a ban. On its face, the paranoia is so sad. Indeed, the near unanimity within Congress in favor of expropriating TikTok is such an insult to the American people. Apparently they’re so unthinking and malleable that an app allegedly operated for political propaganda purposes over profit can “turn” them as it were.
Oh well, even there the government’s case is hard to take seriously. Really, since when do politically apathetic Americans care so much about politics in the first place? To the tune of 170 million U.S. users? Is it possible Americans aren’t as politically focused as the politicians who don’t trust them, and who are so eager to take their freedom? 170 million users signals a resounding yes to the previous question.
Of course, the bigger insult underlying the paranoia of Rep. Mike Gallagher et al is what it implies about how they see the U.S. Apparently its greatness is flimsy. Stupendously so. To believe the U.S. political class, they must act in aggressively authoritarian ways to protect us from thought that might cause us to favor aggressive authoritarians in China. Allegedly patriotic American politicians think an “app” can break us, or negatively influence our political situation as though the present one is so impressive. But I digress.
Back to U.S. demands that ByteDance sell TikTok to American buyers, let’s be clear that this is thievery. Plain and simple. Seriously, how can ByteDance get anything remotely resembling a fair price for its highly entrepreneurial innovation if always meddling politicians get to choose the nationality of its future owners along with the timeframe in which the business is sold? Readers know the answer to the question. ByteDance quite simply cannot come close to fully achieving remuneration for its intrepid investment in TikTok under the circumstances foisted on it. Anyone who has ever negotiated knows why.
Worse, a forced sale ignores what is likely a major reason for ByteDance’s reticence to sell in the first place: not just anyone can operate TikTok in the way that its present team does. Evidence supporting this claim can be found in TikTok’s extraordinary valuation, one achieved in a social media market well populated by the richest, most talented technological minds on earth. TikTok beat them, yet its owners are supposed to sell their creation to those they beat? It’s just a reminder that the forced sale is theft on its face (see eligible buyers and timeframe), but much more than that given an even lower price that would logically accompany TikTok sans the engineers and executives who made it TikTok. And if readers are still confused, might they speculate on Tesla’s worth sans Elon Musk, Meta’s without Mark Zuckerberg, and Nvidia’s without Jensen Huang?
Nearly four years ago, and after then-President Trump threatened to ban TikTok, I wrote an opinion piece which said “Americans don’t do this, do they?” It seems we do. How embarrassing. How chicken-s—t. How Third World.
