Trump's Changing Tune
TikTok is a social media app developed in China and owned by ByteDance.
Last week Trump said he would ban TikTok regardless of what happened for security reasons. Microsoft was in negotiating a deal to buy the app when Trump made the announcement.
July 31 - Banning TikTok
Last Friday Trump said he would ban TikTok in the US despite the fact that TikTok claims it has 100 million US users.
Over the weekend, Trump changed his mind and Gave Microsoft until September 15 to close the deal.
The deadline alone is ridiculous.
Now Trump demands Microsoft pay the US Treasury a substantial sum to allow the deal to go through.
Trump Demands a Chunk of TikTok Sale Price
TechCrunch reports Trump Calls TikTok a Hot Brand, Demands a Chunk of TikTok Sale Price.
After stating last Friday that he’d rather see TikTok banned than sold to a U.S.-based company, Trump changed his tune over the weekend.
Today the president, endorsing a deal between an American company and ByteDance over TikTok, also said that he expects a chunk of the sale price to wind up in the accounts of the American government.
The American president has long struggled with basic economic concepts. For example, who pays tariffs. But to see Trump state that he expects to receive a chunk of a deal between two private companies that he is effectively forcing to the altar is surreal.
TechCrunch transcribed the pertinent few minutes of Trump's explanation from this morning's Hiring American Executive Order Signing, when asked about the weekend call with Microsoft’s Nadella.
We had a great conversation, uh, he called me, to see whether or not, uh, how I felt about it. And I said look, it can’t be controlled, for security reasons, by China. Too big, too invasive. And it can’t be. And here’s the deal. I don’t mind if, whether it’s Microsoft or somebody else — a big company, a secure company, a very American company — buy it.
It’s probably easier to buy the whole thing than to buy 30% of it. ‘Cause I say how do you do 30%? Who’s going to get the name? The name is hot, the brand is hot. And who’s going to get the name? How do you do that if it’s owned by two different companies? So, my personal opinion was, you are probably better off buying the whole thing rather than buying 30% of it. I think buying 30% is complicated.
And, uh, I suggested that he can go ahead, he can try. We set a date, I set a date, of around September 15th, at which point it’s going to be out of business in the United States. But if somebody, whether it’s Microsoft or somebody else, buys it, that’ll be interesting.
I did say that if you buy it, whatever the price is, that goes to whoever owns it, because I guess it’s China, essentially, but more than anything else, I said a very substantial portion of that price is going to have to come into the Treasury of the United States. Because we’re making it possible for this deal to happen. Right now they don’t have any rights, unless we give it to ’em. So if we’re going to give them the rights, then it has to come into, it has to come into this country.
It’s a little bit like the landlord-tenant [relationship]. Uh, without a lease, the tenant has nothing. So they pay what is called “key money” or they pay something. But the United States should be reimbursed, or should be paid a substantial amount of money because without the United States they don’t have anything, at least having to do with the 30%.
So, uh, I told him that. I think we are going to have, uh, maybe a deal is going to be made, it’s a great asset, it’s a great asset. But it’s not a great asset in the United States unless they have the approval of the United States.
So it’ll close down on September 15th, unless Microsoft or somebody else is able to buy it, and work out a deal, an appropriate deal, so the Treasury of the — really the Treasury, I suppose you would say, of the United States, gets a lot of money. A lot of money.
How Would Payments Work?
The Wall Street Journal comments on the Unusual Nature of the TikTok Announcement
“It’s a great asset,” Mr. Trump said of TikTok. “But it’s not a great asset in the United States unless they have the approval of the United States,” he said, reiterating that the Treasury should get “a lot of money.”
The White House referred questions about how a payment would work to the Treasury Department. A Treasury spokeswoman didn’t respond to a request for comment.
The WSJl has a great video of the above transcription if you have access. It's worth a play.
Surreal or Unconstitutional?
Trump would have legal challenges on banning the app alone, but his latest proposal is absurd.
TechCrunch commented on the "surreal" nature of the proposal.
I suggest a different word.
Telling business owners they have to pay the government a slice of any deal or the government will not allow it is blatantly unconstitutional.