Biden administration risks political backlash if Musk-run Twitter investigated


Elon Musk and Joe Biden - 070922

Biden administration risks political backlash if Musk-run Twitter investigated

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With the midterm elections fading into memory, one of the most talked-about stories in Washington is Elon Musk‘s acquisition of Twitter — and what the Biden administration may or may not do about it.

President Joe Biden held a press conference Wednesday after his party’s surprisingly successful midterm cycle and was asked whether Musk’s Twitter poses a national security threat due to the involvement of foreign financing.


“I think that Elon Musk’s cooperation and/or technical relationships with other countries is worthy of being looked at,” Biden responded. “Whether or not he is doing anything inappropriate, I’m not suggesting that. I’m suggesting that it’s worth being looked at. And — but that’s all I’ll say.”

The statement could set the stage for one of the biggest showdowns of the next year.

Jake Sullivan, Biden’s national security adviser, went even further than the president on Thursday, suggesting the Committee on Foreign Investment in the United States, or CFIUS, should investigate Musk’s Twitter ownership because that is where “transactions that might have a national security nexus get reviewed.” CFIUS includes the Justice Department as well as Treasury and other executive departments.

Musk purchased Twitter for $44 billion on Oct. 27. At issue are portions of the financing — $500 million from a company with ties to China, $1.9 billion from a Saudi prince, and $375 million from Qatar Holdings LLC, which is owned by Qatar’s sovereign wealth fund.

While those investments total just 8% of the deal, they raise eyebrows from people who are concerned with foreign influence in a company wherein so much political discourse is traded. Musk also has ties to China through Tesla, including a factory in Shanghai and a showroom in Xinjiang province.

“If Twitter or Musk wanted this deal to be safe [from investigations], they would have notified CFIUS in advance and obtained a safe harbor letter,” said Sanjay Patnaik, a fellow at the Brookings Institution. “I’d imagine Musk probably did not notify CFIUS preemptively and did not obtain such a letter. “

Patnaik and two Brookings colleagues wrote a report on why they believe CFIUS should investigate the deal on national security grounds. It can definitely happen after the fact — in 2020, the Trump administration ordered a Chinese company to divest from U.S. company StayNTouch following a CFIUS review a full year after the initial acquisition.

If there is an investigation of Musk and Twitter, Patnaik says the Biden administration could simply order Musk to rework the foreign investments or could go all the way up to blocking the deal outright.

That’s if an investigation is warranted.

Conservatives point to recent beef between Musk and Biden that clouds the political picture. Musk mocked one of Biden’s recent gaffes and told independents to vote Republican this fall. Meanwhile, the White House deleted a tweet after a new site feature fact-checked it, and Biden accused Musk of spreading “lies all across the world.”

Such open conflict raises legitimate questions about the motives of any investigation, argues Carl Szabo, vice president of the technology lobbying group NetChoice.

“Perhaps Biden and [White House chief of staff] Ron Klain don’t like what Musk is doing and they’re trying to use the federal government to force a social media company into practices the Biden administration wants, not necessarily what Twitter users or its owner want,” he said. “This is why it’s essential for a Republican-controlled House to hold the necessary oversight hearings that have been missing for the past two years.”

A Republican-controlled Congress passed a bill that strengthened CFIUS in 2017, and Biden issued an executive order explicitly including U.S. election interference as a factor CFIUS must consider.

But Szabo argues the law is too vague about under which circumstances CFIUS can launch investigations, saying it’s “so broad you could drive a political truck through it.” He points to a bill called the Protecting Speech from Government Interference Act that supporters argue would keep government employees from engaging in overtly political actions.

Conservatives have made similar arguments, with one pundit calling the investigation push a form of “Elon Musk Derangement Syndrome.”


Rep. James Comer (R-KY), who could take over as House Oversight Committee chairman in January, blasted what he calls a double standard within the Biden administration.

“That’s a big deal,” Comer said on Fox & Friends First on Fox News on Thursday morning. “The fact that Joe Biden said that there should be an investigation into Twitter over foreign investment will go down in history as one of the most hypocritical statements ever made by a president of the United States once our investigations into the Biden family’s influence peddling are concluded.”

© 2022 Washington Examiner

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