By: STEVEN LEE MYERS AND PAUL MOZUR
San Francisco: When Elon Musk opened a Tesla factory in Shanghai in 2019, the Chinese government welcomed him with billions of dollars’ worth of cheap land, loans, tax breaks and subsidies. “I really think China is the future,” Musk cheered.
Tesla’s road since then has been lucrative, with a quarter of the company’s revenue in 2021 coming from China, but not without problems. The firm faced a consumer and regulatory revolt in China last year over manufacturing flaws. With his deal to take over Twitter, his ties to China are about to get even more fraught.
Like all foreign investors in China, he operates Tesla at the pleasure of the Chinese authorities, who have shown a willingness to influence or punish companies that cross political red lines. Musk’s extensive investments in China could be at risk if Twitter upsets the Communist Party state, which has banned the platform at home but used it extensively to push Beijing’s foreign policy around the globe — often with false or misleading information.
At the same time, China now has a sympathetic investor who is taking control of one of the world’s most influential megaphones. Musk said nothing publicly, for example, when the authorities in Shanghai shut down Tesla’s plant as part of effort to control the latest COVID outbreak, even after lambasting US officials for a similar step when the pandemic began in 2020.
“It’s concerning to think about what could be a conflict of interests in these situations, looking at disinformation that could come out of China,” said Jessica Maddox, an assistant professor of digital media technology at the University of Alabama. “How would he, as now an owner of this company, handle that since all of his investments are tied up there, or most of them?”
Even the simple pledge to ban bots and artificial accounts that populate its user base could irk China’s propagandists, who have openly bought fake accounts and used them to undercut claims of human rights abuses in Xinjiang. It is not clear whether he intends to restore accounts or remove labels that identify some of Beijing’s most prominent users as state officials.
As Twitter’s new owner, Musk may well face Chinese pressure on other issues as well. They include not only demands from the authorities to censor information online even outside China’s Great Firewall — descriptions of Taiwan as anything but a province of China, for example — but also the arrests of Twitter users in China.
In China, Musk’s takeover has raised fears that officials will have even more levers to censor their critics, some of whom use technology to get around the Twitter ban.
One likely result of the takeover will be less transparency. As a publicly traded company, Twitter was beholden to shareholder pressure when concerns about disinformation, account bans and rule enforcement affected its share price. That, in turn, forced it to explain its policies for countering information campaigns, like those originating in China. With Musk planning to take the company private, there is less prerogative to respond to such inquiries.