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Elon Musk's BREXIT Moment?
The risks of asking for a referendum without know how people will vote
Elon Musk might wish he had paid a little more attention to recent history before asking Twitter users whether he should step down as CEO. “I will abide by the results of the poll,” he tweeted. It’s doubtful he was secretly looking for a way to give up control of the company for which he recently paid $44 billion. No one wants to leave because of a no-confidence vote. Musk’s problem seems to be that he misjudged the sentiment among voting Twitter users. He and his inner circle most likely expected a full-throated endorsement in the “do I stay or leave” poll. Those results could then be championed to show critics that Twitter’s user back the way Musk runs the company.
David Cameron, the former British Prime Minister, made the biggest political gamble of his career when he promised publicly in January 2013 to hold an in/out referendum on the U.K.’s membership in the European Union. Cameron wanted Britain to remain in the E.U. He and his advisors knew there was a risk to asking the public to decide in a straight vote, but they were confident they knew what the British people wanted. Maybe the same as Musk believed he understood what Twitter users wanted?
When the U.K. narrowly voted to leave the E.U. in 2016, Cameron announced his resignation the next day. He subsequently called the BREXIT referendum his “greatest regret.”
What will Musk do? Divining what the mercurial owner of Twitter will do is a fool’s errand. After putting so much money and energy into the ‘new Twitter’ he might be miffed enough from the vote to step away and return full time to Tesla and Space X. Or, he could just spin it to say the vote is a sign “we must do better.”
When I was at Cravath, Swaine and Moore, a New York law firm, in the late 1970s, one of the first rules we learned as litigators was “never ask a question of a witness to which you are not certain of the answer.” It is the same bottom-line lesson to political leaders and CEOs: Don’t ask for a popular vote referendum if you are not sure what people will do. Sometimes they can surprise. Ask David Cameron. Or better yet, ask Elon Musk.