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16 November 2022

The chaos at Elon Musk’s Twitter is a parable of US power in the age of Big Tech

Silicon Valley’s plight is fundamental to one of the biggest geopolitical questions of the 21st century: can the US maintain its pre-eminence over China?

By Jeremy Cliffe

It has been a matter of weeks since Elon Musk lumbered into Twitter’s headquarters in San Francisco on 26 October carrying a sink, a contrived set-up enabling him to tweet “Let that sink in” on the completion of his $44bn purchase of the social network. That breezy new dawn feels like an age ago. Musk has since sacked about half of Twitter’s workforce, demanded immediate changes and apparently discovered in real time that the firm is a more complex ecosystem than he had initially realised. Rushed overhauls have caused glitches. Indispensable employees have reportedly been offered their jobs back. Some advertisers have paused their ad spending. Stories have leaked of internal chaos and even warnings of bankruptcy. Having clearly assumed owning Twitter would make him the coolest kid in school, Musk now resembles a harried supply teacher losing control of the classroom.

The sweep of this arc makes it tempting to see Twitter’s predicament purely through the prism of Musk’s own impulsive and often puerile behaviour. Yet that would be to miss the bigger picture.

Silicon Valley as a whole is in trouble. The firms behind the Big Five brands – Google, Facebook, Amazon, Apple and Microsoft – have collectively lost at least $3trn of value this year. US-based tech firms have shed some 28,000 jobs. Some of this is merely a correction after the surge in Big Tech fortunes during the pandemic, as lockdowns forced people’s social and retail activities indoors and online. But deeper structural forces are at play too. The era of low interest rates is over. Regulators and users have become more probing on topics such as privacy, data protection and monopolistic practices. Revenues from digital advertising have fallen and uncertainties over future business models loom: a year ago Mark Zuckerberg rebranded Facebook as Meta, betting big on virtual reality; so far in 2022 the firm has lost almost 70 per cent of its market value.

This is more than a technology story. Silicon Valley is a pillar of American power: in its sheer economic weight, in its cultural reach and in its cutting-edge research and development in fields like big data and AI. Its plight is thus fundamental to one of the biggest geopolitical questions of the 21st century: can the US maintain its pre-eminence over China?

That contest is one of radically different systems: between America’s democratic, individualistic and open model of society, and China’s autocratic, collectivist and more closed system. The rapid rise of Silicon Valley has been a triumph for the American system. Some two thirds of its workers were born outside the US, a testament to the country’s ability to attract talent. Its capitalism is radically innovative. Its spirit is libertarian and disruptive (“move fast and break things”, to cite Zuckerberg’s motto). Silicon Valley is the concentrated essence of the traits that, the US and its allies hope, will undergird America’s superpower status over the coming decades.

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Which brings us back to Twitter. Beyond the chaos, Musk has hinted at how he intends to make the network “a common digital town square” and a “collective, cybernetic super-intelligence”. His vision seems to involve cutting back moderation in the name of free speech; driving users to verify their identities and pay to use the site; and in the long term turning Twitter into an “everything app”, an American equivalent of China’s WeChat, which combines social networking with messaging, payments, shopping and gaming.

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But this strategy is clearly beset with tensions that speak to the broader troubles in Silicon Valley and their significance for the American system. How to enact what Musk calls his “free speech absolutist” approach without the site becoming a free-for-all? And how to do so in autocratic states? How to push towards authentication while protecting users’ privacy and data? How to create an everything app that does not fall foul of US competition and antitrust regulations? The comparison with WeChat provides a telling contrast: in China’s system all of these issues are simpler. The platform routinely censors content, infringes the privacy of its users and is closely linked with the state; even Xi Jinping’s crackdown on Big Tech last year left the app unscathed.

Musk’s difficulties, then, go far beyond his own executive style (relevant though it is to the turmoil at Twitter) to fundamental tensions in Silicon Valley and the American system it epitomises. A system with an emphasis on individual rights and open, competitive markets – the very basis of its strengths – faces existential questions in an age of big data and AI.

Yet China’s system also has its tensions: it can be brittle, stifling, unresponsive. Its tech giants have their own problems. Xi’s tightening grip on the economy and society, for example, poses existential questions about the country’s future capacity for innovation. Recent events – from Ukraine’s Western-backed humbling of Vladimir Putin to Joe Biden’s expansive climate bill and the defeat of conspiracist Republicans at the midterm elections – warn against underestimating US strength. With their hubris, nerdish swagger and cringeworthy quests for validation that money cannot buy, titans like Musk, or Zuckerberg, or Amazon’s Jeff Bezos, make easy targets for ridicule. But they are merely manifestations of the American system – a system, for all of its many dysfunctions, whose resilience and ability to adapt it would be a grave mistake to discount.

[See also: Is this the end of Twitter?]

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This article appears in the 16 Nov 2022 issue of the New Statesman, The state we’re in