The TikTok 'Deal' Was A Grift From The Start: Accomplishes None Of The Stated Goals; Just Helps Trump & Friends
from the a-joke dept
A week ago, we explained that the announced "deal" between Oracle and TikTok was a complete joke and what appeared to be a grift to let Trump claim he had done something, while really just handing a big contract to one of his biggest supporters. That was based on the preliminary details. As more details came out, it became even clearer that the whole thing was a joke. TikTok's investors actively recruited Oracle because they knew they needed to find a company that "Trump liked."
Over the weekend, Trump officially gave the "okay" on the Oracle deal (which now also involves Walmart). And before we get into the details of the deal and why it's a total grift, I'd like to just step back and highlight:
It is positively insane, Banana Republic, kleptocratic nonsense that any business deal should hinge on whether the President himself gives it a thumbs up or a thumbs down. Do not let all the insanity of this current administration hide this fact. If this had happened during the Obama administration, how crazy do you think Hannity/Carlson/Breitbart/etc. would be going right now about "big government" and claiming that the President is corrupt beyond belief? We should never, ever be in a situation where any President is giving the personal thumbs up or thumbs down to a business deal (and that's leaving out the fact that he forced this business deal in the first place with a blatantly unconstitutional executive order.
Okay, now back to the actual deal. Oracle and Walmart will team up to create a "new" (very much in quotes) company called TikTok Global that will be headquartered in the US. Of course, this is a joke. TikTok already has US operations. Oracle and Walmart will end up with a small equity stake in this "new" company (combined about 20%), but the Chinese company ByteDance will still own the majority of the company and will still control the TikTok algorithm. While there is some chatter about how the data will be hosted in the US, for the most part that was already true. Oracle says that it will review things to make sure that the data is secure, but remember, this is the same Oracle that collects a shit ton of data on internet users via Blue Kai, and then leaked it all. It's also the same Oracle that works closely with US spy agencies and isn't exactly known as being particularly good at security.
As the NY Times notes, this deal appears to accomplish literally nothing. As we said before, it was all performative, letting Trump claim he had "done something," when the rationale for the deal ("national security") was always bogus, and this is proved by the fact that nothing in the new setup changes whatever national security questions there were about the app before. So, rather than force ByteDance to "sell" the company to protect "US national security" as the NY Times rightly notes all that came out of this was:
A cloud computing contract for the Silicon Valley business software company Oracle, a merchandising deal for Walmart and a claim of victory for President Trump.
As former FCC chair Tom Wheeler tells the NY Times:
Vetting deals “is normally a process that involves multiple thoughtful people coming to the issue from multiple different concerns,” said Tom Wheeler, a former Democratic chairman of the Federal Communications Commission. “This appears as though what passes for process is what pleases one man: Donald J. Trump.”
Again, Banana Republic kleptocracy.
The NY Times also noted that Walmart either seemed to rush out its press release over the deal, or whoever wrote it had a heart attack in the process of composing it:
“This unique technology eliminates the risk of foreign governments spying on American users or trying to influence them with disinformation,” the company said. “Ekejechb ecehggedkrrnikldebgtkjkddhfdenbhbkuk.”
And that's not even getting into the whole issue of the mysterious $5 billion education fund. With the announcement, Oracle and Walmart said the new company would "pay $5 billion in new taxes to the Treasury," and then separately that it would "develop an educational curriculum driven by artificial intelligence to teach children basic reading, history and other subjects." Those two points got conflated to suggest that it was putting $5 billion into that project -- which sounded suspiciously like the finder's fee Trump demanded when first talking about forcing TikTok to be sold.
This got even more insane when Trump declared that he wanted the $5 billion to be used for his new 1776 history project, which is his new fascistic indoctrination education program, which Trump and his idiot followers insist is necessary because they falsely believe that kids are being indoctrinated to hate America (they're not -- they're just finally being taught, at least a little bit, that slavery is a key part of American history).
And the story got even more crazy when, after Trump talked about all of this, ByteDance came out with a giant shrug, saying it was totally unaware of any $5 billion education fund and appeared to have no interest in actually doing that.
It seems that most of the confusion was -- as per usual -- on the part of our not very intelligent President, who couldn't comprehend that the small education fund was different than the $5 billion, which is merely just estimate future tax revenues to the Treasury that, given the tax breaks this same President has helped set up, will probably never actually materialize.
It's like a clusterfuck of stupidity, corruption and kleptocracy. It's America in 2020.
Filed Under: banana republic, china, donald trump, grift, ieepa, kleptocracy, larry ellison, nonsense
Companies: bytedance, oracle, tiktok, walmart
