Twitter, Elon Musk, and the 2022 technology crash

Twitter’s pending collapse is greatly exaggerated even after a large number of staff members quit, but the social media platform is not alone in the chaos plaguing Silicon Valley.  Facebook, Amazon, and others are all experiencing massive layoffs, crumbling stock prices, and shrinking or non-existent profits.  The progressive gravy train is rapidly coming to an end…

Last week, Elon Musk, the world’s richest man, gave the remaining employees at Twitter an ultimatum.  “Going forward, to build a breakthrough Twitter 2.0 and succeed in an increasingly competitive world,” he wrote in an email, “we will need to be extremely hardcore. This will mean working long hours at high intensity. Only exceptional performance will constitute a passing grade.”  He concluded, “If you are sure that you want to be part of the new Twitter, please click yes on the link below.  Anyone who has not done so by 5pm ET tomorrow (Thursday) will receive three months of severance.”  Mr. Musk’s ultimatum came after Twitter had already laid off around 50% of its approximately 7,500 employees, prompting The New York Times to claim the company is in “disarray.”  “Hours before a Thursday deadline that Elon Musk had given Twitter employees to decide whether to stay or leave their jobs, the social media company appeared to be in disarray…All the while, two people said, resignations started to roll in. By the deadline, 5 p.m. Eastern time, hundreds of Twitter employees appeared to have decided to depart with three months of severance pay, the people said. Twitter later announced via email that it would close ‘our office buildings’ and disable employee badge access until Monday.”  Fortune’s technology reporter, Kylie Robison, claimed on Twitter itself that some 75% of the remaining employees were planning to quit and the only employees left would be those on visas that cannot simply find another job.  “As we’re all very aware, folks on visas are stuck, so thats who makes up most of the roughly 25% (or less than 1,000….) expected to stay. The actual impact is not yet known — there have been no internal comms about what comes next. We’re nearly 2 hours post deadline.”  For their part, some soon-to-be-former Twitter employees took to, well, Twitter to announce their resignations.  Matt Miller, for example, posted a video and claimed “It’s been a ride.”  Other Twitter employees were claiming the social media platform’s days were numbered.  Travis Akers, once again on Twitter itself, said “From one of the remaining Twitter employees, ‘It (Twitter) as about a week before it’s dead.’”  Alex Heath proclaimed, “Hearing from multiple employees that the odds of Twitter breaking in the near future are very high.”

Prominent Twitter users jumped on the bandwagon, and the #RIPTwitter hashtag rapidly trended.  Progressive firebrand Alexandria Ocasio-Cortez wrote, “Hoping this doesn’t happen, but just in case: it’s been wonderful tweeting with y’all!” She proceeded to promote her Instagram and email newsletters.  Molly Jong-Fast, the American journalist, writer, and granddaughter of the communist author of Spartacus, Howard Fast, said, “Wait, we’re all saying goodbye to each other?  This is really weird.”  Conservative political commentator, Mary Katherine Ham noted, “Twitter can’t end.  There are so many people I haven’t talked shit to.”  Nathan Wurtzel, joked, “I imagine this is what it will be like in the final days before the giant meteor or the Yellowstone eruption.”  Someone took the time and money to project text onto Twitter headquarters, proclaiming the office “Musk’s hellscape,” claiming the company was “launching into bankruptcy,” expressing the need to “#StopToxicTwitter” along with “Elon Musk, STFU!”  Apparently, the irony about proclaiming the end of Twitter on Twitter was not lost on some at least.  The parody account Keef Girgo posted, “It’ll be very awkward when after hours of eulogizing this site doesn’t actually go down, it’ll be like saying goodbye to a date and then realizing you’re walking to the same subway station.”  Yair Rosenberg tweeted, “This place has more false endings than Lord of the Rings: Return of the King” and “Nice to see Twitter going out as it lived: Hysterically overreacting to the latest news development, compulsively sharing false viral tweets that confirm its priors, and repeatedly mistaking satirical accounts for real ones.  Godspeed.”  For his part, Mr. Musk seemed confident enough, joking about the challenges facing him in taking over the social media company.  He tweeted, “How do you make a small fortune in social media? Start out with a large one,” and other memes poking fun at the supposed imminent demise of his $54 billion purchase.  At the same time, he did note that Twitter usage hit another all time high amidst the supposed chaos.

The New York Times wasn’t the only mainstream media outlet predicting Twitter’s imminent collapse.  For their part, CNN reported “As Twitter staff empties out, users fear the worst.”  “On Thursday night, following another exodus of Twitter employees, the outage detection site Down Detector showed a spike in users reporting issues accessing the social media platform. A chart of the sharp increase in outage reports was shared by some users on Twitter, appearing to validate a growing fear that the site would struggle to stay online with fewer staff. But that wasn’t exactly the case just yet.”  The punchline came next, “In fact, Twitter did not appear to be facing an outage, but rather Down Detector was automatically registering hundreds of tweets from users wondering whether the site might go ‘down’ or if the company would be ‘shutting down.’”  In other words, the site didn’t actually go down, but regardless of this reality, “The apparent confusion highlighted a very real anxiety about Twitter’s imminent demise, just weeks after it was acquired by the world’s richest man.”  Got that? They reported on an outage that didn’t actually happen, once upon a time that was known as “misinformation,” which we were told was very, very bad, and then they claimed that, whether or not the outage actually happened or does actually happen, the anxiety is “very real.”  So real in fact, CNN felt the need to accompany this with an “analysis” by Oliver D’Arcy, “Twitter is the world’s digital public square.  What happens if it dies?”  He’s sure to begin by making clear whose fault this was.  The idea that Twitter could collapse was “unthinkable just a few weeks ago, but a cascade of events precipitated by the company’s erratic new owner, Elon Musk, has thrown the future of the platform into uncertainty.”  Really?  Perhaps Mr. D’Arcy could’ve taken a moment to check the company’s financials before writing his piece.  The fact is Twitter has been losing a lot of money lately, posting a $344 million loss just last quarter with $1.18 billion in revenue against $1.52 billion in expenses, an operating margin of a whopping, negative 29%.

These numbers do not suggest a company with a certain future; that Mr. Musk was able to buy it outright in the first place should’ve been proof enough of that and evidence that major changes were needed.  What precisely was he to do upon taking over other than reducing overhead by slashing staff and eliminating costly perks?  This was inevitable even should the company have remained public, but the progressives in Silicon Valley and the mainstream media continue to be convinced that there’s such a thing as a free lunch, literally and figuratively.  Twitter’s employees seem to think their cushy, pandemic proof, work from home jobs with high salaries and unbelievable fringe benefits are theirs by right, and that the platform exists entirely to serve their own purposes, the equivalent of a highly paid public utility for progressive causes.  To put this in perspective, the average Twitter salary is about $118,000 per year, significantly higher than the average income in America.  Computer programmers at Twitter make significantly more than that, with senior engineers averaging $148,662 according to PayScale.com.  Mr. Musk expects his associates to actually work for it, especially given the poor financial condition of the company, while the associates themselves, or at least a significant portion of them, believe they are entitled to earn that kind of living without actually producing measurable results.  This is the crux of the madness gripping Silicon Valley in general.  For the past ten years, technology has transformed from an exciting, entrepreneurial, hard working, shoot for the moon industry that recognizes no boundaries to its ambition, into a progressive enclave akin to academia.   In the view of many employees at Twitter, they are entitled to work for one of the most prominent companies in the world, in what used to be one of the most exciting fields in the world, without any of the accompanying hassle and stress of even basic things like going to the office once a week or paying for their own lunch, much less long, arduous hours and tight deadlines.

Nor does their sense of entitlement end there.  They also feel free to publicly criticize their own boss on their own platform, airing their grievances and gripes in public without any fear of retaliation.  Incredibly, many in the mainstream media appear to be in agreement with Twitter’s recalcitrant employees.  Business Insider, for example, believes the situation makes clear that “CEOs can’t bully their employees anymore. Elon Musk’s failed ultimatum to Twitter employees is proof of that.”  As they see it, “Musk’s authoritarian leadership style might have worked before — and still might in some industries — but in many cases, the voice-of-God approach no longer causes as many employees to snap to attention.  Many workers are tired and unhappy with the status quo, and that’s a sign leaders should proceed with caution.”  This is an odd way to put it. The status quo at Twitter at least was a disaster. Mr. Musk is there to save it. In order to do so, he’s going to need people he can trust, that are willing to go the extra mile, and that are onboard with his vision. Employees who are not, should leave. The company is better off without them. That’s the entire point of the ultimatum in the first place. Meanwhile, Twitter is not the only high profile technology company laying off staff, suggesting the opposite of what Business Insider is claiming, at least in the short term. Employees should proceed with caution lest they end up unemployed.  Earlier this month, Facebook’s parent company, Meta, announced layoffs of some 11,000 associates, the most significant cuts in the company’s history.  “Today I’m sharing some of the most difficult changes we’ve made in Meta’s history,” CEO Mark Zuckerberg explained in a blog post to employees. “I’ve decided to reduce the size of our team by about 13% and let more than 11,000 of our talented employees go.”  In addition, the company plans to hire fewer people next year.  This comes in the wake of financial news not nearly as bad as that afflicting Twitter.  The social media giant has now seen two consecutive quarters of declining profits, with total profit in the third quarter cut in half from the prior year.  Meta once boasted a market cap of more than a trillion.  It now stands at $250 million.  “I want to take accountability for these decisions and for how we got here,” Mr. Zuckerberg wrote. “I know this is tough for everyone, and I’m especially sorry to those impacted.”

Amazon is also planning layoffs of about 10,000 corporate employees, after two straight quarters of losses this year before returning to profitability in the third quarter.  “As part of our annual operating planning review process, we always look at each of our businesses and what we believe we should change,” spokesperson Kelly Nantel said in a statement. “As we’ve gone through this, given the current macro-economic environment (as well as several years of rapid hiring), some teams are making adjustments, which in some cases means certain roles are no longer necessary.”  Even smaller companies in the tech industry have been affected.  The ride sharing company, Lyft, is eliminating 13% of its employees.  The credit card processing company, Stripe, 14%.  As CNN described it, “The tech sector has been facing a dizzying reality check as inflation, rising interest rates and more macroeconomic headwinds have led to a stunning shift in spending for an industry that only grew more dominant as consumers shifted more of their lives online during the pandemic.”  Estimates put the total layoffs in the tech industry at almost 87,000 with more expected to come.  “The clock has struck midnight in terms of hyper-growth for Big Tech,” explained Wedbush Securities analyst, Daniel Ives. “These companies hired at such an eye popping rate, it was not sustainable. Now there’s some painful steps ahead.”  It is only when covering Twitter itself that progressive media outlets insist the challenges are Mr. Musk’s creation.  It’s also worth considering why they loathe Mr. Musk in the first place: He rejected the premise of the lockdowns and believes in free speech. That’s their entire beef with the world’s richest man, In reality, the entire technology sector has become bloated, corpulent, and ossified, but the gravy train always comes to an end at some point.  What once was the dreamworld of endless hiring, in office massages, and free lunches among other perks, is now waking up to the real world like everyone else. We’re witnessing the great realignment, dare I saw crash now, though many seem incapable of admitting it and would prefer to blame Mr. Musk.

Given the overall economic environment, one has to question the wisdom of any Twitter employee quitting because their boss requires them to work a little harder.  Where are they supposed to work now when no one else is hiring?  The progressive website Slate.com is pondering exactly that.  “Current job capacity isn’t allowing people room to shuffle around and transition.”  Jessica B. Davis, a professional career consultant, explained the obvious. “In the past, you left one company and then went to the next, but now we’re seeing all kinds of constraints.”  In a more rational and sane world, Twitter employees and the media at large would realize they have been gifted with an amazing opportunity.  Mr. Musk is the most successful business man in the known universe, having founded three companies.  He is the first person in decades to successfully launch a new, mass market car company.  History is rife with those who tried to do the same and failed, often spectacularly, from Tucker to Fisker with DeLorean in between.  He is the first person ever to successfully privatize space travel, revolutionizing another industry.  This does not mean he will succeed at Twitter, but anyone betting against him, especially given that the animosity is largely for political reasons, is likely to lose based on his track record.  Each employee is of course entitled to their opinion, free to quit for whatever reason, but putting this another way, who else is better suited to the job and who else could they possibly want to work for?  This did not prevent the progressive activist, Andrew Wortman, who goes by the username AMoneyResists, from responding to the recent changes at Twitter by claiming Mr. Musk was “failure incarnate.”  “He fired ¾ of the employees.  Now he’s planning to starve the rest.  He’s failure incarnate.”  He then proceeded to call him a “cheap pile of garbage.”  Would that all of us could fail as spectacularly as Mr. Musk. Instead and rather unfortunately, many of us seem hellbent on being as political as Mr. Wortman.

PS After writing most of this post, Mr. Musk announced that former President Donald Trump’s Twitter account was reinstated following a poll of users, and prompting another progressive freak out, illustrating how all the naysaying and griping is simply politics, and strengthening the irony of an ongoing flamewar on a platform that isn’t even supposed to exist anymore.

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