The Deplatforming of President Trump
Which platforms does Trump have left?
As President Trump belatedly conceded defeat in the 2020 election — after lawmakers and, reportedly, his own cabinet members weighed how to remove him from office — he has found himself with ever-fewer avenues to speak out online, underscoring the power of internet giants and an abrupt shift in how they treat his behavior online.
Facebook extended Mr. Trump’s ban from its platforms for at least two weeks, blocking him for the remainder of his term. “We believe the risks of allowing the president to continue to use our service during this period are simply too great,” Mark Zuckerberg wrote in announcing the move. The breaking point was Wednesday’s unrest, he told employees.
Amazon’s livestreaming service Twitch, the e-commerce company Shopify and PayPal also shut down accounts associated with Mr. Trump or his supporters. YouTube adopted a new policy that makes it easier to suspend the president and others for pushing false election claims.
Mr. Trump regained access to Twitter after being locked out for 12 hours. Though the company had temporarily blocked the president on public safety grounds, its C.E.O., Jack Dorsey, made clear publicly that he wouldn’t follow through with more stringent measures — for now. Commentators speculated that the quasi-concession speech that Mr. Trump posted after the suspension may have been an effort to avoid permanent exile.
He’s at risk of losing much of his influence without mainstream platforms. Mr. Trump’s Facebook and Twitter accounts were valuable assets from which to wage political battles and garner media coverage. Being consigned to much smaller networks like the conservative-leaning Parler and Gab “wouldn’t likely satisfy the president’s desire for a mass audience” and could leave him at a disadvantage should he try to remain a force in the Republican Party or run again for president in 2024, The Times’s Kevin Roose writes.
That kind of power has some worried. Critics on the left and right have sought to curtail legal protections that shield internet platforms from liability for their users’ content, and the issue is sure to remain front and center when President-elect Joe Biden assumes office. That said, even Ajit Pai, the Trump-appointed chairman of the Federal Communications Commission, didn’t object to Facebook and Twitter blocking his boss.
In other fallout from the Capitol mayhem: The Justice Department refused to rule out pursuing charges against Mr. Trump for his possible role in inciting the violence; more administration officials have resigned; and several companies fired employees who were spotted participating in the mob violence (and one firm suspended its C.E.O., who was arrested at the Capitol).
HERE’S WHAT’S HAPPENING
The U.S. surpasses 4,000 Covid-19 deaths in a day. The country reported another grim record, putting its total death toll from the disease at over 365,400. Meanwhile, scientists worry that the Capitol rampage was a super-spreading event.
President-elect Joe Biden names his pick for commerce secretary. He will nominate Gov. Gina Raimondo of Rhode Island, a former venture capitalist, for a role that is a key liaison with the business world. But because of delays in Congress, Mr. Biden may not have a single cabinet official confirmed before his inauguration, a break from the norm.
Boeing settles a 737 Max investigation for $2.5 billion. The fine resolves a criminal charge by the Justice Department that the plane maker conspired to defraud the Federal Aviation Administration in the wake of two deadly crashes.
SoFi is going public via SPAC. The online lender will merge with a blank-check fund backed by the investors Chamath Palihapitiya and Ian Osborne. Anthony Noto, SoFi’s C.E.O., said that the company had considered staging an I.P.O. but preferred the certainty of a SPAC deal.
Guess where Bitcoin is trading now. If you said “setting yet another record,” congrats: The cryptocurrency has surpassed $40,000 per coin and roughly doubled in price over the past month.
Our take yesterday on the accountability of business leaders who backed President Trump really struck a chord, based on all the thoughtful feedback we received from readers. Thanks to all who shared their thoughts (and keep them coming).
After a pro-Trump mob stormed the Capitol on Wednesday, some of the president’s former allies in the business world have begun rethinking their relationship with him. The billionaire investor Nelson Peltz, for example, said he regretted supporting Mr. Trump’s re-election, but defended his economic policies.
“Big business struck a Faustian bargain with President Trump,” The Times’s David Gelles writes. They issued vague statements when he flirted with authoritarianism and applauded his leadership when he cut taxes and reduced regulation.
The former Starbucks chief Howard Schultz told David that the 2017 tax cut, perhaps the administration’s signature economic achievement, “seduced” business leaders but turned out to be “fool’s gold.”
The Carlyle Group’s David Rubenstein told Andrew that “I don’t think that condemnation today is the most important thing.” He added, “I don’t know that my voice means as much as the voices of people that have been elected.”
This cognitive dissonance is what got us here, Daniella Ballou Aares, the C.E.O. of the Leadership Now Project and a former Obama administration adviser, told DealBook. When it comes to Mr. Trump’s autocratic tendencies, “there are more than a few businesspeople who thought they could wait it out,” she said. “Now it’s clear you can’t ignore it.”
The $195 billion man
Elon Musk is now the richest person in the world, according to the Bloomberg Billionaires Index, taking the title from Jeff Bezos. To be fair, they’re both worth nearly $200 billion, so who’s counting?
Tesla’s stock price surge is what put Mr. Musk over the top. The electric car maker’s shares have risen more than 700 percent over the past year. They now trade at a price-to-earnings ratio of around 1,600, versus 30 for the S&P 500 and 20 for rival auto companies like G.M.
His unusual pay package was very well timed. Recall that an audacious compensation plan, approved in mid-2018, gives Mr. Musk big chunks of shares tied to “a series of jaw-dropping milestones based on the company’s market value and operations,” as we wrote at the time. Tesla was worth around $60 billion back then, and experts considered the plan’s upper limit, a market cap of $650 billion, “laughably impossible,” since it would have made Tesla one of the five largest companies in the U.S.
You can guess what happened: Tesla just passed Facebook to become the fifth-most-valuable listed company on Wall Street, at more than $770 billion. On what this meant for his net worth, Mr. Musk said yesterday: “How strange.”
In the papers
Some of the academic research that caught our eye this week, summarized in one sentence:
Anticipation of a big tax cut didn’t account for much of the gain in stocks in 2017, so a potential hike may have a modestly negative effect. (Anthony Diercks, Daniel Soques and William Waller)
As China shifts away from labor-heavy manufacturing, it isn’t clear which country will take its place. (Gordon Hanson)
“We exploit a 2016 nonaggression pact between gangs to examine how collusion affects extortion in areas where gangs previously competed.” (Zach Brown, Eduardo Montero, Carlos Schmidt-Padilla and Maria Micaela Sviatschi)
Exclusive: A bid to become the benchmark of climate risk
As companies and regulators increasingly see climate change as a business threat, the data company Gro Intelligence is devising indexes that it says can track climate risks down to specific locations or assets — and could create a new class of financial investments.
The company is offering indexes to measure conditions like drought, floods, temperature and more, according to its co-founder and C.E.O., Sara Menker. Its drought index, for example, aggregates 46 variables that the company’s software transforms into a measure of drought severity on a scale from zero to five. Beyond helping clients like Unilever, which already uses Gro’s data for sustainability planning at its Knorr brand, the indexes could be used to build an array of derivatives, like swaps that companies and investors can use to hedge climate risks, said Ms. Menker, a former Morgan Stanley commodities trader.
Even as the indexes could be used to create and price swaps, catastrophe bonds and even exchange-traded funds, Ms. Menker can’t predict what else could be built on them: “People always ask, what do you do next? I say, I don’t know what we’re going to do next.”
The demand for climate-related financial products is growing, as companies seek more data to gauge the risks to their supply chains and guard against environmental risks. The Commodity Futures Trading Commission recently published a sweeping report declaring climate change a systemic risk and urging development of financial hedges and investments.
Unlike insurance products, which are usually bespoke and limited in what they cover, Gro’s indexes are based on standardized data that allows for comparisons of assets around the world, Ms. Menker said. And unlike many existing indexes, she said, her company’s products can be applied to assess the risks to specific physical assets like individual farms or factories.
Gro has raised $85 million to help fund its efforts, we’re the first to report. The new round — which surpasses the $50 million target the company set last summer — will be announced later today and was led by Intel Capital, a partnership between TPG Growth and EchoVC, and the family offices of Ronald Lauder and Eric Zinterhofer.
Gro also recently signed up a new board member: Gary Cohn, the former Goldman Sachs president and Trump economic adviser, who was initially asked to find weak spots in Gro’s indexes. “As financial institutions and companies are increasingly required to disclose climate risk, universally trusted and transparent data will be very important,” Mr. Cohn said.
THE SPEED READ
Robinhood may sell some of its shares directly to users when it goes public this year. (Bloomberg)
The French tech services provider Atos has reportedly offered to buy DXC, a former subsidiary of Hewlett-Packard, for $10 billion. (Reuters)
Politics and policy
Federal investigators are examining whether American Express used misleading tactics to sell corporate cards. (WSJ)
The Small Business Administration will prioritize applications from minority-owned companies when it restarts the Paycheck Protection Program. (Politico)
Chinese officials have reportedly ordered state media to censor coverage of an antitrust crackdown on Alibaba. (FT)
Hyundai said it has held talks with Apple about a potential partnership on electric self-driving vehicles. (WSJ)
Best of the rest
Neil Sheehan, The Times reporter who obtained the Pentagon Papers, died yesterday. He was 84. Here’s how he broke one of the seminal stories of the Vietnam War. (NYT)
The last episode of “Jeopardy!” featuring Alex Trebek, who started as host in 1984 and died in November, will air today. (NYT)
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