The president has drawn up a glowing assessment of his environmental action. The CEO of Tesla says Biden has his priorities wrong.
Elon Musk is outspoken. To say the least.
“As a reminder, I supported Biden, Hilary and Obama,” the billionaire said on Twitter last December.
How things have changed.
“In the past I voted Democrat, because they were (mostly) the kindness party,” he explained last May. “But they have become the party of division & hate, so I can no longer support them and will vote Republican. Now, watch their dirty tricks campaign against me unfold.”
Musk Highly Critical of Democrats and Biden
A few weeks later he said that he “voted for Mayra Flores – first time I ever voted Republican.” And Musk predicted a “massive red wave in 2022.”
The red wave never happened. The Democrats managed to retain control of the Senate and even increased their majority in the midterm elections last November. The Republicans regained control of the House but with a narrow majority.
Since buying Twitter for $44 billion on Oct. 27, he has decided to turn the platform into a conservative stronghold. The microblogging website got rid of most safeguards against misinformation, racism and antisemitism in the name of free speech. This decision scared away many advertisers.
Musk has also made it his mission to fight what he calls the woke mind virus, which encompasses all progressive values.
Twiitter 2.0 has seen the publication of the Twitter Files, which include information from the platform intended to prove that Twitter 1.0 — pre-Musk — had implemented practices to muzzle conservative voices. These internal platform documents were given to some journalists.
One of the points in the Twitter Files is the way the platform had blocked the sharing of a New York Post article on Hunter Biden’s activities in Ukraine. This story appeared during the 2020 election campaign pitting his father, Joe Biden, against incumbent President Donald J. Trump.
Twitter Co-Founder and Former CEO Jack Dorsey has told Congress that the decision to block the article was a mistake.
But Musk and conservatives have made it a priority in recent weeks to prove what they allege is social media’s pro-Democratic bias.
It is in this context that President Biden has just posted a message on Twitter and a video praising his environmental action.
Musk has now taken the opportunity to use a climate metaphor to indicate that a banking crisis marked by the collapse of banks is occurring under Biden’s reign. As a result, Musk says, this should be his priority.
‘The Banks Are Melting’: Musk
“In my first year in office, we protected more lands and waters than any president since John F. Kennedy,” Biden said on March 22. “We’ve also made the largest investment to fight climate change – ever.
“Today, we’re building on that momentum by protecting additional natural wonders,” the president concluded.
The minute-plus video accompanying this message is Biden’s announcement that he is issuing a presidential memorandum, directing the secretary of commerce to immediately consider designating 777,000 square miles on the Pacific Ocean southwest of Hawaii a National Marine Sanctuary.
Musk, who is a pro climate, didn’t seem impressed.
The billionaire seems surprised that Biden was touting his climate action in the midst of a crisis of confidence in banks that has already led to the collapse of three — Silvergate, Silicon Valley Bank and Signature Bank in New York.
Fears of contagion to regional banks remain strong even though regulators and the White House have already indicated that the U.S. financial system is sound.
“Umm … the banks are melting,” the entrepreneur commented.
Musk’s sour comment sparked a debate among Twitter users, who, like the billionaire, believe Biden has the wrong priority.
“But Jerome and Janet said it’s fine, so it must be, right? RIGHT!?” commented one Twitter user, referring to Federal Reserve Chair Jerome Powell and Treasury Secretary Janet Yellen.
“The world is crumbling all around us, but look at this dirt we’ve saved,” quipped another user.
But another Twitter user disagreed, saying the banks are not melting.
“Two small banks failed because of the mistakes of their management, enabled by Trump’s deregulation. Customers rushed to withdraw their deposits, creating a crisis of confidence, not assets. Big banks are all well-capitalized and in better shape than in 2008,” the user commented.
The current banking crisis indeed stems from Silicon Valley Bank’s bad bet on interest rates, buying Treasury bonds when rates were low. There was no risk that the borrower — the federal government — would default.
But the bank did not address the risk that interest rates could go up. (Bond prices move inversely to interest rates.) It therefore did not hedge this risk, which meant that the value of its asset portfolio had declined. When its customers began to draw on their deposits, SVB had to sell these assets at a loss to meet the withdrawals, but the run on the bank was larger than expected.
Investors fear that other regional banks will find themselves in the same situation as SVB.