Musk, TikTok and risks to US ‘national security’
The tech tycoon is being floated as a potential buyer for the Chinese-owned hip-short-video platform
Time is running out for TikTok in the United States. Last week, the US Supreme Court indicated it would uphold the law over national security fears and ban the free-wheeling Chinese-owned social media site.
As the countdown begins, Elon Musk is being floated as a potential buyer for the Chinese-owned hip-short-video platform. He appears to have the right credentials as far as Beijing is concerned, Bloomberg News reported earlier this week.
Musk is a “confidant” of incoming US President Donald Trump, who returns to the Oval Office in the White House next week. He was also a major financial donor of Trump’s election campaign to the tune of US$250 million.
To illustrate Musk’s political clout, the Financial Times revealed that the ruling Communist Party of China, or the country’s government, could use him as a “broker in a potential sale” of TikTok’s American operation.
Still, there are other issues at play for the world’s richest man and the driving force behind Tesla, SpaceX and social media platform X, formerly Twitter.
[This] does not give the incoming White House license to ignore these risks.
Lieutenant General Russel Honoré
In a New York Times op-ed, Lieutenant General Russel Honoré “condemned” Musk’s web of Chinese business interests, including $1.4 billion in state bank loans and a Tesla factory subject to Beijing’s stringent information-sharing laws, The Guardian reported.
“The fact that Mr. Musk spent a quarter of a billion dollars to help re-elect Mr. Trump does not give the incoming White House license to ignore these risks,” Honoré wrote in the NYT last month.
What makes TikTok tick:
- Millennials and Gen Z have flocked to the site owned by China’s ByteDance.
- It has 170 million American users and is valued at around US$40 billion.
- It also has addictive algorithms, hoovering up a treasure trove of personal data.
Between the lines: “For China, selling to Musk could mean placing TikTok in the hands of an ally, someone whose business empire is deeply reliant on the Chinese market and who has the ear of incoming President Donald Trump,” CNN reported this week.
The bottom line: “[This comes] at a time when Beijing will be looking for leverage in tariff negotiations,” the American news network added.
Musk’s $400 billion fortune is built on Tesla and its operation in China.
CHINA FACTOR
Delve deeper: Retired general Honoré pursued a similar theme, pointing to an October report in The Wall Street Journal of regular communications between Musk and Vladimir Putin since late 2022. The Russian president is a close ally of Chinese leader Xi Jinping.
Big picture: It prompted two Democratic senators to demand an investigation into SpaceX’s US government contracts, the Reuters news agency reported in November.
Why it matters: “If the federal investigations demonstrate deep connections to China and Russia, the federal government should consider revoking Mr. Musk’s security clearance,” Honoré wrote in the New York Times.
What next: “It should already be thinking about using alternatives to SpaceX’s launch services,” he said in the op-ed.
China Factor comment: Musk’s $400 billion fortune is built on Tesla and its operation in the world’s second-largest economy. But he still has to answer to shareholders. It will be interesting to see what they make of his political posts on X and those TikTok rumors.