Trump, TikTok and the benefit to America

There is an interesting twist to the beginning of Donald Trump’s second term as President of the United States. A day before his inaugural, the Chinese-owned social platform TikTok went off with the ban on it coming into effect. Later on Sunday, it said it was restoring its service after President-elect Donald Trump said he would revive the app’s access in the US when he returns to power on Monday.

The statement came after US users reported being able to access the Chinese-owned service’s website while the far more widely used TikTok app itself did not appear to be immediately available. The US Congress had banned it saying that it should find an American partner, and the US Supreme Court, many of whose judges were appointed by Trump during his first term as president, had unanimously upheld the ban. Trump had asked the Supreme Court to hold back, but it did not.

So, Trump had promised that he would give TikTok a reprieve period of 90 days in which it could find an American partner. The media buzz is Trump’s friend and member of his new administration, Elon Musk, the owner of X, of Tesla and Space X, is the likely American buyer of TikTok. But TikTok had not confirmed the reports.

But TikTok in its final message before its shutdown on Saturday said that it hopes to be back in action soon because Trump had promised to bring it back soon after taking office on Monday, January 20. Trump too said that he thinks that he will do it, though he was not assertive about the action he would take. Trump told NBC television news channel: “The 90-day extension is something that will most likely be done, because it’s appropriate. If I decide to do that, I’ll probably announce it on Monday.”

TikTok sounded more positive in its expectation of what Trump would do to restore its operations. In its farewell statement, TikTok said, “A law banning TikTok has been enacted in the U.S. Unfortunately, that means you can’t use TikTok for now. We are fortunate that President Trump has indicated that he will work with us on a solution to reinstate TikTok once he takes office. Please stay tuned.”

TikTok is used by 170 million Americans, nearly half the population of the US. There were concerns about Chinese-owned enterprises in America because of national security reasons. TikTok is owned by Byte Dance, but only 20 per cent of TikTok is that of the Chinese. About 60 per cent of it in America is owned by companies like Black Stone and General Atlantic.

There is also the rumour that Perplexity, an American social media player, could merge with TikTok to form an enlarged entity.

The issue assumes importance because of Trump’s stated position that he wants to keep the foreign players out of the American scene because he believes that they are making profits at the expense of the American consumer. And he has been critical of Chinese imports into the US because they are huge, cheap and they outflank American competition.

But Trump’s attitude towards China has been ambivalent. While he is critical of China’s economic policies, he has invited Chinese President Xi Jinping for the inaugural. Xi however is not attending the inaugural. Trump wants to wage an economic war against all foreign competitors, and China is one of the major competitors.

Trump’s opposition to the foreign competitors is on the grounds of economic disadvantage of the US. If Americans are benefiting in any way from foreign imports he would not take up a position against it. What provokes him is the fact the foreign companies in America are dominating American markets and that they are taking advantage of America’s open-door policies. He wants to raise the tariff walls to defend what he believes to be American interests.