What Brazil vs. Musk Tells Us About the Next Four Years of Tech Diplomacy

Trust and safety teams at major social media companies have a hard job. Many of those companies are based in the United States but serve billions of users around the world. Just as overseas users have varying expectations of these companies in terms of what constitutes “appropriate” political news and commentary, overseas governments develop expectations around the appropriate governance and moderation of that content, sometimes embroiling the companies in controversy. Examples abound, including accusations that social media played a decisive role in the Arab Spring and Myanmar’s Rohingya genocide, that it accelerated Ethiopia’s civil war, and that it favored one side or the other of the political spectrum in the United States during recent electoral cycles. Political polarization can magnify the problem, with those on the left and right holding vastly different views of what constitutes appropriate moderation, both among the public and within government.

The case of Brazil: Very online and very polarized

The case of Brazil is instructive. Brazil has been a regional leader in social media adoption, with spillover effects in the political realm. Each of the last three presidential elections in Brazil were nicknamed after the social media platform that was argued to play a role in mobilization and the spread of (mis)information.

Brazil is also the most highly-polarized country in our global political polarization rankings, with a whopping 37% of adults saying they have views on the extremes of the left-right ideological spectrum. 

Political polarization in Brazil has been quite high for a while, but as we’ve seen elsewhere, contentious elections are polarization engines. Brazil saw a spike in polarization leading up to the highly contested 2022 election between newly incumbent President Lula and then-incumbent President Bolsonaro, culminating in a Washington-style storming of the capital in Brasília on Jan. 8, 2023 by Bolsonaro supporters who rejected the results of the election in which leftist Lula regained the presidency. 

The 2022 election also saw a secular decline in public trust of the media and of the tech industry more broadly: Observers found evidence that the election saw a massive increase in misinformation and disinformation, much of it spread over social media and aimed at questioning electoral institutions and traditional media. 

Declining post-election trust in the tech industry and the media also translated into declining trust in foreign social media companies specifically

Among five major foreign social media brands that are tracked by Morning Consult Intelligence, four of them saw declining trust levels among Brazilian adults at the same inflection point after the Jan. 8 riots in Brasília.

This decline in trust set the stage for Elon Musk’s and X’s very public fight with the Brazilian judiciary in August-October of 2024. Lula’s government vowed to crack down on disinformation on social media platforms in a response to what it saw as the basis for Bolsonaro’s rise to power. Its method for doing so has been highly ad hoc, giving Brazilian judges the authority to earmark specific accounts for removal. X objected on free speech grounds, and was temporarily banned in Brazil before ultimately backing down.

Trust in the tech industry has declined in Brazil, but opposition to antitrust has increased

Brazil’s government is now reaching for antitrust as a tool to rein in technology companies, including social media. In October, Lula’s government recommended a reform to its competition law that would empower CADE, its antitrust authority, to designate certain digital platforms as systemically important and subject them to new requirements. 

The Brazilian competition legislation was modeled at least in part on Europe’s Digital Markets Act (DMA). Under the 2022 Act, the European Union designated a number of large U.S. tech companies as “gatekeepers” subject to stricter antitrust rules, and has since opened probes into Google, Apple and Meta, and fined X in July 2024 for violations. The Biden administration’s Federal Trade Commission (FTC) reportedly consulted with the European Union on its implementation of the law, much to the anger of some congressional Republicans and industry leaders now in proximity to power. 

But on some level, the new Brazilian reforms are out of step with public opinion: While trust in the tech industry has declined in Brazil, opposition to antitrust has actually increased. The share of Brazilians who say the government should play a major role in determining if companies are too large, and if so, break them up, has declined by roughly 10 points over the last two years. Furthermore, the left-right divide on the issue is striking, with a large majority of right-wing respondents having a negative reaction to empowering the government to break up private enterprises. The left wing of the political spectrum, meanwhile, has a near-majority in favor. 

What this means for U.S. social media companies’ overseas operations in the next four years

The Brazilian example is an interesting case study which illuminates some of the risks and opportunities for U.S. social media companies operating globally over the next four years. As in Brazil, U.S. social media companies will continue to be called onto the carpet by politicians alleging that their moderation (or lack thereof) benefits those politicians’ political opponents. Just in the last few weeks, a Romanian court’s decision to annul the results of a first round presidential election based on allegations of a Russian interference campaign via TikTok is an example of this. 

But looking ahead to 2025, the incoming Trump administration is poised to realize its vision for light-touch tech regulation, with robust support from Silicon Valley. If the Trump administration internationalizes this mission, pushing back against foreign regulations on U.S. companies, it could have a chilling effect on some foreign regulators and policymakers, presenting opportunities for international public policy heads at U.S. technology companies. 

How the new U.S. administration will project its views on anti-trust to overseas cases is more in question, as the Republican Party struggles with internal divisions on the topic. Some prominent Trump allies, most notably J.D. Vance, have spoken out in favor of the FTC’s muscular anti-trust enforcement against technology companies under the Biden administration, while other Trump supporters have been staunchly opposed. Some speculate that Trump’s FTC pick, Andrew Ferguson, may continue high profile anti-trust cases against big tech, while loosening other regulations. If so, expect foreign governments to accelerate the use of anti-trust to fight perceived dominance of U.S. tech firms in their countries, pointing to U.S. efforts as justification. 

In markets like Brazil, political entrepreneurs will try to make hay from setting themselves up as a metaphorical David against the U.S. tech Goliaths. In Europe, which prides itself on being a regulatory trendsetter, the DMA is not only not going away, but E.U.-style legislation may now look more attractive to U.S. states beyond California seeking to differentiate themselves from the federal government. And for U.S. social media companies not seen as Trump allies who run afoul of foreign conservative governments making accusations of censorship, the incoming Trump administration is likely to be much less helpful.