The U.S. authorities will gather a multibillion-dollar fee from the American traders who will take over TikTok. Some consultants name it a price and different offers prefer it “extortion.”
SCOTT SIMON, HOST:
The Trump administration just lately approached a bunch of American traders set to take over TikTok’s U.S. operations with an uncommon demand – in the event that they wish to shut the deal, they have to pay an enormous one-time price to the federal authorities. It is the newest instance of one thing that is turning into more and more widespread within the White Home – extracting money from personal companies to make a deal. NPR’s Bobby Allyn has been wanting into this and joins us. Bobby, thanks a lot for being with us.
BOBBY ALLYN, BYLINE: Hey, Scott.
SIMON: First, who’s shopping for what I am going to name U.S. TikTok?
ALLYN: Yeah. There’s various principally U.S. traders, together with Michael Dell, the Murdoch household and Oracle, which is run by Trump ally Larry Ellison. And such as you mentioned, they’re shopping for the U.S. facet, so the U.S. model of TikTok to adjust to a federal regulation that claims China can’t have management over the app. The White Home is valuing the deal at round $14 billion.
SIMON: However in fact, that is not with the extra price. How a lot is that price going to be?
ALLYN: I’ve a supply with direct information of the talks who was not licensed to talk, however they mentioned the traders have agreed to a price within the low billions, and that may be dedicated to the U.S. treasury.
SIMON: Why would the traders pay that?
ALLYN: My supply informed me that it is simply seen as the worth of doing enterprise proper now, however to say this sort of price to the federal authorities is uncommon is sort of the understatement. I talked to historians, economists and business insiders, Scott, who all informed me that squeezing companies like this has only a few parallels in trendy historical past.
SIMON: And this isn’t the primary time the administration has gotten concerned in a deal like this, proper?
ALLYN: Yeah, there’s various different examples, together with chipmakers Nvidia and AMD. They will be giving the federal authorities 15% of its gross sales to China. The White Home secured a so-called golden share in U.S. Metal. And my colleague, David Folkenflik, has reported that when CBS settled a Trump lawsuit for $16 million, it cleared the way in which for mum or dad firm Paramount to merge with Skydance Media. Some consultants say these preparations appear to be shakedown schemes. I talked to Luigi Zingales. He is a finance professor on the College of Chicago, and he calls these preparations lease in search of.
LUIGI ZINGALES: Widespread language is much less subtle. It is known as sucking up. Nevertheless it’s truly fairly costly.
ALLYN: Zingales says it is costly as a result of these funds find yourself basically being a tax on enterprise transactions that contain the federal authorities, they usually truly can change how companies function day-to-day.
ZINGALES: As an alternative of innovating, folks will spend time making an attempt to ingratiate Trump. As an alternative of going and discover new discovery, they’ll spend time in Washington within the corridors of energy, making an attempt to determine what pleases Trump.
SIMON: Bobby, how does the Trump administration reply to this criticism?
ALLYN: The White Home did not return my request for remark, however within the Oval Workplace on Thursday, Trump was requested in regards to the multibillion-dollar price, and he dodged the query. As an alternative, he mentioned, quote, “the U.S. comes out nice” within the TikTok deal. Now, after Trump received Intel to conform to a ten% stake of the corporate to the U.S., following Trump’s requires the CEO of Intel to resign, Trump did make a put up on Fact Social, and it mentioned, quote, “america paid nothing for these shares, and the shares are actually valued at roughly $11 billion. It is a nice deal for America and likewise an amazing deal for Intel.” So the president does appear to view these uncommon interventions in personal enterprise as one thing of a win for the nation.
SIMON: NPR’s Bobby Allyn. Thanks a lot.
ALLYN: Thanks, Scott.
Copyright © 2025 NPR. All rights reserved. Go to our web site terms of use and permissions pages at www.npr.org for additional data.
Accuracy and availability of NPR transcripts might range. Transcript textual content could also be revised to appropriate errors or match updates to audio. Audio on npr.org could also be edited after its authentic broadcast or publication. The authoritative document of NPR’s programming is the audio document.
