Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche


The Media’s new Scapegoats for Trump: Facebook and Zuckerberg

The media and the Democratic Establishment have new scapegoats for the success of President Donald J. Trump (R-New York). Those scapegoats are Facebook (NASDAQ: FB); its founder-CEO Mark Zuckerberg, and social media.

The theory behind this scapegoating is that ordinary people are mindless brutes Zuckerberg and Trump can control at the touch of a button. Hence, Zuckerberg can guarantee Trump’s reelection by waving his magic wand.

Recent headlines display this sick thinking. For instance:

Facebook and Twitter spread Trump’s lies, so we must break them up,” Former U.S. Treasury Secretary Robert Reich in The Guardian, 3 November 2019.

The Republican political operatives who call the shots at Facebook.Popular Information newsletter 17 October 2019.

In addition, “How Facebook could change Trump’s 2020 re-election bid,” Gina Heeb in Markets Insider, 2 November 2019.

Or this gem: “Mark Zuckerberg is a horror show” in The Washington Post, 20 July 2019.

Disturbingly, Facebook’s crime in Popular Information; and Reich’s eyes, is respecting Americans’ First Amendment rights by refusing to censor political advertising. Reich fears Trump could win next year’s presidential election because Facebook respects the President’s free speech.

Moreover, Presidential Candidate Andrew Yang’s (D-New York) first TV ad features a picture of Zuckerberg and a promise of challenging Big Tech. I have a feeling other politicians; including Trump himself, will follow Yang’s lead by jumping on the bash Facebook bandwagon.

The New Trump Conspiracy Theory: Blame Facebook

The Trump/Facebook conspiracy is simple, Zuckerberg somehow rigs Facebook posts or news feeds to show only pro Trump propaganda that makes ignorant yahoos vote for Trump.

The theory is preposterous because most Americans; most of whom are presumably Facebook users, voted for Hillary R. Clinton (D-New York) in 2016. In detail, Clinton received 65.845 million votes (48.2%) to Trump’s 62.980 million votes in 2016 46.1%, CNN estimates.

Furthermore, the number of social media using 18 to 29-year-olds participating in the 2018 biannual elections rose from 20% to 36%, a 79% increase, the US Census Bureau estimates. During that election Democrats won control of the US House of Representatives in a campaign, widely seen as a rebuke of Trump.

Moreover, polls show that younger people who are heavy social media users oppose Trump. For instance, a Harris-X poll shows only 39% of Americans under 35 approved of Trump in March 2019, The Hill reports.

Hence, social media and Facebook could benefit Democrats. Yet the New York media will never admit the possibility. One reason for this is that younger social-media savvy voters favor leftists like U.S. Senator Bernie Sanders (I-Vermont) and Andrew Yang (D-New York) to “moderates” like Joe Biden (D-Delaware).

However, Facebook’s manipulation of voters; like Russiagate, is gospel in the Democratic Establishment. Hence, we will get a year; or more, of increasingly nonsensical Democratic attacks on fellow Democrat Zuckerberg and his company.

Incredibly, Zuckerberg himself is a liberal who promotes far left ideas such as the basic income. In addition, Zuckerberg openly supports a Democratic presidential nominee Pete Buttigieg (D-Indiana) in the primaries, Bloomberg reports.

Plus, Facebook Chief Operating Officer (COO) and second-in-command Sheryl Sandberg served in the U.S. Treasury Department in the Democratic Clinton administration. Hence, a Democratic company; that once invited President Barack Obama (D-Illinois) to speak on its campus, is now a target of Democratic politicians.

Why are Establishment Democrats Blaming Facebook for Trump?

Establishment Democrats’ attacks on Facebook have several motivations.

First, the Democratic Establishment will never admit that Hillary R. Clinton (D-New York) was a terrible candidate who ran a horrible campaign. Second, Establishment Democrats will never admit their agenda finds no support outside the CNN studios.

Blaming unpopular actors; like Facebook or Russia, allows Establishment Democrats to ignore their own incompetence and unpopularity. In addition, neither the media nor the Democratic Establishment will admit they are totally out of touch with the American people.

Second, the previous media and Democratic Establishment conspiracy: blame Russia no longer works. The American people have no interest in Russia Gate and the evidence for it is questionable. Thus, the Establishment needs a new Bogeyman ,and Facebook is a perfect Bogeyman.

Third, attacking social media; such as Facebook, serves the interests of traditional media. The Big Media desperately wants to recover its former role as America’s primary source of information.

Old media can achieve that goal by discrediting, or suppressing, social media. Thus, the Facebook conspiracy serves old media’s interests.

Fourth, attacks on social media can distract the people; and the media, from other problems the establishment wants to ignore. Income inequality, wage stagnation, financial insecurity, and technological unemployment, for instance.

One way to achieve such distraction; while looking populist and left-wing, is to bash giant social media corporations. Big Tech is unpopular because discomfort with technology is growing.

Fifth, the Democratic Establishment wants to quash the discussion of popular radical ideas such as Medicare for All, Free College, the Wealth Tax, the Value-Added Tax, the Robin Hood Tax, and a Basic Income. Yet they want to appear left-wing.

The New Establishment Media Bigotry

Sixth, attacking social media is a great way to manipulate popular prejudices. Notably, Zuckerberg and Sandberg are Jewish, so moderate Democrats can practice Anti-Semitism without sounding Anti-Semitic by bashing Facebook.

Seventh media elitists can publicly engage in snobbery against ordinary Americans. To explain, the thrust of the Facebook conspiracy is that ordinary people are ignorant dolts whose minuscule minds are easy to manipulate.

Eighth, the conspiracy theory gives establishment Democrats a reason to ignore average people. The theory is that everything ordinary people believe is shallow propaganda Trump and Zuckerberg create.

How the Establishment will use the Facebook Conspiracy Theory

Recent op-eds and news show us how the Democratic establishment and old media will use the Great Facebook Conspiracy theory next year.

First, they will try to label any politician who deviates from their party line as a Facebook shill. Oddly, Hillary recently gave us a taste of that by calling presidential candidate and Congresswoman Tulsi Gabbard (D-Hawaii) a “Russian asset.” Gabbard’s crime in Clinton’s eyes was to criticize elite foreign policy as bad for America.

Second, they will label any movement or candidate that deviates from the establishment’s Centrist party line: a Facebook front. In particular, they will label any ordinary person, candidate, or group that promotes policies such as Medicare for All, or a Basic Income, a Trump/Facebook front.

Third, they will try to make the national discussion about the Facebook conspiracy. The Facebook conspiracy will be all they discuss. It will be the only topic on Sunday morning TV shows, at establishment websites, and in publications. TV producers will tell candidates “talk Facebook or you get no airtime.”

Fourth, they will blame any Democratic establishment failure in 2020 on Facebook. If Trump wins, that will be Facebook’s fault. If Joe Biden (D-Delaware) loses the Democratic nomination, it will be Facebook’s fault.

If Bernie, Liz Warren, or Yang, wins the Democratic nomination, that will be Facebook’s fault. If Sanders, Warren, or Yang, beats Trump in November 2020 that will be Facebook’s fault.

If the American people totally reject the Establishment Democrats’ centrist agenda, it will be Facebook’s fault. If centrist Democrats lose any elections, it will be Facebook’s fault.

Ironically, I think Zuckerberg could go from public enemy number one in left-wing Democratic circles to the man of the hour because of the conspiracy theory. Thus, the conspiracy theory could help Zuckerberg.

Will the Conspiracy Theory Hurt Facebook Stock?

Strangely, the great conspiracy theory has not hurt Facebook (NASDAQ: FB) stock.

Facebook shares traded on $177.75 on 8 October 2019 and $190.57 on 8 November 2019. Thus, Mr. Market thinks Facebook is more valuable because of the conspiracy theory.

Moreover, Stockrow estimates Facebook’s revenue grew at a rate of 28.59% in the quarter ending on 30 September 2019. Plus, Facebook reported a quarterly gross profit of $14.497 billion on 30 September 2019 up from $13.579 billion on 30 June 2019.

Facebook reported a quarterly operating income of $7.185 billion and a quarterly net income of $6.091 billion on 30 September 2019. Those numbers were up from $4.832 billion and $2.616 billion on 30 June 2019.

Zuckerberg Laughs all the Way to the Bank

Astoundingly, Facebook reported $52.269 billion in cash and short-term investments on 30 September 2019. That cash pile grew from $48.596 billion on 30 June 2019.

Therefore, Zuckerberg; and Facebook stockholders, are laughing all the way to the bank as establishment Democrats peddle their ridiculous conspiracy theory. Consequently, I think establishment Democrats have no desire to hold Facebook or Zuckerberg accountable. Instead, they want a scapegoat for their own incompetence.

I think Facebook will have little impact on next year’s presidential election. However, Facebook is still a great stock all investors need to investigate.

The Problem with Antisocial Media

For a good overview of the Great Facebook Conspiracy Theory and the growing technophobia among the intellectual elite see Siva Vaidhyanathan’s recent book “Antisocial Media: How Facebook Disconnects Us and Undermines Democracy

I think Vaidhyanathan’s work is little more than Ivy League snobbery disguised as social science. For instance, Siva, a Professor of Media Studies at the University of Virginia, thinks Zuckerberg could be a better person if he completed his Harvard degree. Zuckerberg’s biggest crime in Siva’s eyes was dropping out of Harvard without a degree.

In addition, I found blatant factual errors in the book. For instance, Vaidhyanathan; like Hillary R. Clinton, believes President Donald J. Trump (R-New York) was “the only person to lose money in the casino business.”

In reality, 64 U.S. casinos closed between 2016 and 2017 because they were losing money, Statista estimates. So Trump is hardly unique in losing money in gambling.

Plus, Vaidhyanathan claims they released the movie Midnight Cowboy in 1972. Midnight Cowboy won the Academy Award for Best Picture in 1969; the year they released it, IMDb notes.

I have to question an academic who gets such basic and easily checked details wrong. Predictably Antisocial Media is popular and widely quoted.

Sorry Democrats, Facebook did not Elect Trump

There are real problems with social media and Facebook, but those technologies did not put Donald J. Trump in the Oval Office. Instead, a combination of Democratic incompetence, voter suppression, smart and hard-working Republican strategists, and popular discontent fueled by economic anxiety did that.

If Establishment Democrats want to beat Trump, they need to ignore the Great Facebook Conspiracy Theory and start treating voters with respect.