Software giant Oracle’s on-again, off-again deal to save short-video app TikTok from a White House ban has been called many things in the weeks since it was proposed.
It’s been called “geopolitical” because the deal is now being negotiated at the highest levels of government in China, where its parent company is based; and in DC, where the Trump administration believes the Chinese are stealing user data to spy on us.
Other descriptives include “complex” because of the weird structure of the deal, and “crony capitalism” because Oracle will make a lot of money if this thing goes through, thus benefiting its chairman Larry Ellison, a close friend of President Trump.
I’ve also heard it described as “lifesaving” because parents may be spared the tantrums of countless 12-year-olds if Trump’s threat to shut down TikTok comes true.
Now let me add one of my own: Clown show.
Trump believes the Chinese are taking the user data, presumably from all those 12-year-olds, to spy on us. Why? Well, because the Chinese like to spy, we are told. Parent company ByteDance, like all Chinese companies, must answer to the Chinese Communist Party.
OK, I know it’s certainly possible that the Chinese want to get over on us, but a little evidence might be needed here that their vehicle to infiltrate the country is a dance-video app popular with kids.
And if TikTok is a really bad thing, then it’s hard not to chuckle at this “deal” by Oracle to save it. First off, no significant money is changing hands, at least according to the latest iteration I’ve been briefed on.
Oracle and TikTok’s US venture investors, General Atlantic Partners and Sequoia Capital, created the structure that makes it look like TikTok will largely be owned by US investors. Oracle will manage TikTok in its cloud, a highly lucrative business. If the deal is approved, General Atlantic and Sequoia will cash out when TikTok goes public.
But an app is only as good as the tech underlying it, also known as the algorithm, and that tech will still be owned by ByteDance.
So much for US ownership.
Trump appeared to love the deal after speaking by phone with Ellison about a week ago. He really likes Ellison watching over TikTok because Larry’s a “tremendous guy,” and, of course, one of the president’s few Silicon Valley supporters, along with the dudes who run General Atlantic and Sequoia.
But when it started to leak that the Chinese were really still running the show, Trump reversed himself and said he might not approve the deal after all.
As of this weekend it’s unclear if the deal will go through. AG Bill Barr doesn’t appear to be on board, but Treasury Secretary Steve Mnuchin does.
On tough decisions like this, the president usually sides with whoever speaks to him last. So Ellison better get on the phone fast, or else a bunch of 12-year-olds are going to have a meltdown. This clown show can’t end fast enough.
‘Black’ mark on Fink as treasury secretary
People who know BlackRock CEO Larry Fink say he yearns to be Joe Biden’s Treasury secretary if the former veep is elected president in November. Because of that, he has been desperately burnishing his progressive bona fides.
That means voicing support for causes like environmentalism and “stakeholder rights,” demanding that corporate boards focus on society instead of just shareholders. As this column reported last week, he also has imposed an office-romance policy designed to root out any possible #MeToo issues among his 16,000 employees, whether real or imagined.
But Fink is given low odds to be the nation’s top money man, Biden insiders tell me. Fink is certainly qualified for the job; he’s a former bond trader, money manager and a longtime Wall Street executive, who started his own asset-management firm and built it into the world’s largest as BlackRock manages more than $7 trillion in assets.
During his 40-plus-year career in finance, he’s also done significant work for the government; BlackRock has served as one of the Federal Reserve’s top financial advisers since the 2008 financial crisis.
The problem for Fink is that he’s got Wall Street on his résumé, which no amount of virtue-signaling can erase. “I love Larry, but why have that fight with the Elizabeth Warren types when there are other good candidates?” said one Biden insider, referring to the powerful and famously anti-Wall Street Massachusetts senator who will certainly raise a stink if Fink is allowed to have his signature on the dollar bill.
Biden isn’t said to be in serious talks on the subject just yet, but his advisers are, and here are the names being floated, according to Bloomberg: Lael Brainard, of the Federal Reserve Board; and Roger Ferguson, formerly of the Fed and currently CEO of Teachers Insurance and Annuity Association/College Retirement Equities Fund (TIAA-CREF), which isn’t seen as too Wall Streety because it manages money for academics, a key Democratic constituency. And possibly, Fink nemesis Elizabeth Warren, which is maybe why he has indicated that for now he isn’t interested in going to DC.