The Daily - Thursday, Apr. 12, 2018

Episode Date: April 12, 2018

Mark Zuckerberg, Facebook’s chief executive, returned to Capitol Hill on Wednesday for a second day of hearings on the company’s mishandling of data. Unlike their Senate colleagues, House members came prepared with tough questions about privacy and the social media company’s practices — as well as a counternarrative to the story Mr. Zuckerberg and his team have carefully crafted. And calls for congressional oversight are growing. Guest: Kevin Roose, who writes about technology for The New York Times. For more information on today’s episode, visit nytimes.com/thedaily.

From The New York Times, I'm Michael Barbaro. This is The Daily. Today, day two of Mark Zuckerberg's marathon hearings in Washington. The House avoids a repeat of the Senate performance, coming prepared with tough questions and a counter-narrative to the one Zuckerberg and his team have been crafting. It's Thursday, April 12th. Hello.

Hello. How are you doing? I'm doing well. How are you? I'm pretty good. How have you endured day two? You know, I left my credit card at a Prêt-à-Manger, but that is the worst thing that happened to me today, so I think that's pretty good.

What did you have there? I had a coffee and a croissant. Their croissants are wildly warm and delicious. They're very good. I always feel a little gross afterward, but, you know, what can you do? So, Kevin Roos, this second day of Mark Zuckerberg's testimony, what did you notice? Well, right away, it felt different. Good morning and welcome, Mr. Zuckerberg, to the Energy and Commerce Committee in the House. We've called you here

today for two reasons. One is to examine the alarming reports regarding breaches of trust between your company, one of the biggest and most powerful in the world, and its users. And the second reason is to widen our lens to larger questions about the fundamental relationship tech companies have with their users. We started off with Representative Walden. While Facebook has certainly grown, I worry it may not have matured. I think it's time to ask whether Facebook may have moved too fast and broken too many things. He asked, what exactly is Facebook? What exactly is Facebook?

Social platform, a data company, an advertising company, a media company, a common carrier in the information age, all of the above, or something else? Which was, I think, the core question. And then the representatives continued. Their knives were out a little bit more. I think the damage done to our democracy relative to Facebook and its platform being

weaponized are incalculable. I think they were a little bit better prepared. Yes or no, will you commit to changing all the user default settings to minimize to the greatest extent possible the collection and use of users' data? Can you make that commitment? Right away, you had Congressman Pallone.

Congressman, we try to collect and give people the ability. But I'd like you to answer yes or no if you could. Will you make the commitment to changing all the user default settings to minimize to the greatest extent possible the collection and use of users data that's i don't think that's hard for you to say yes to unless i'm missing something congressman this is a complex issue that i think is deserves more than a one word answer well again that's disappointing to me because i think you should make that commitment and and i thought he asked a really pointed question when he said something to the effect of, how can consumers have control over their data when Facebook doesn't have control over the data itself?

That's my concern. Last question. I think that was a note that we didn't hear struck that often yesterday in the Senate, and it marked this sort of entry into what would be four hours of much more difficult testimony for Mark Zuckerberg. It is no longer the company that you started in your dorm room. Instead, it's one of great American success stories. That much influence comes with enormous social responsibility of which you have failed to act.

And what was the impact of this harder line of questioning for Zuckerberg? Well, I think it sort of recast the narrative about the company. My top priority has always been our social mission. Yesterday, Mark Zuckerberg had been trying very hard to tell a story about how Facebook was born in idealism. Connecting people, building community, and bringing the world closer together. And only when the sort of world invaded and revealed itself to be bad, it was caught off guard and has to now play defense and catch up to accommodate these bad actors. And so I think today was a very different narrative right from the beginning.

Thank you, Mr. Chairman, and thank you, Mr. Zuckerberg, for being here today on a voluntary basis. A congressman named Billy Long, who's a Republican from Missouri, stood up and asked a question that went back to before Facebook even existed, to 2003, when Mark Zuckerberg was a student at Harvard. There are some things that I think you need to be concerned about. One question I'd like to ask before I go into my questioning is, what was FaceMash and is it still up and running? No, Congressman. And part of the Facebook origin story that often gets edited out is that before he created Facebook,

Mark Zuckerberg created a website called FaceMash. FaceMash was a prank website that I launched in college in my dorm room before I started Facebook. A site that scraped the pictures of students at Harvard from the internal website of the school and sort of set them up in pairs and allowed people to vote on who was hotter. Hmm. I mean, this was a tool to rank the attractiveness of fellow students at Harvard

that was set up without those students' permission. You put up pictures of two women and decide which one was the better, more attractive of the two. Is that right? Congressman, that is an accurate description of the prank website that I made when I was a sophomore. Hmm, sounds kind of telling in retrospect.

Well, yeah, I mean, there's a reason that they don't tell this story and that Mark Zuckerberg has said that the claim that FaceMash was somehow connected to the development of Facebook, it isn't. It wasn't. He has tried very consciously to sort of edit that part out of the Facebook story.

But I think it's important as context for why people have a hard time trusting Facebook now and why people don't necessarily believe that Mark Zuckerberg has their privacy in mind. And I think the sort of lofty origin story about wanting to connect the world and, you know, bring people together, that's something that's been largely constructed after the fact. And I think that was an importance or context for the rest of the members of Congress to say, oh, maybe we should think harder about the story this company is telling about itself. Maybe there's something a little more here than, you know, American college student makes good. You know, you have a long history of growth and success, but you also have a long list of apologies.

In 2003, it started at Harvard. I apologize for any harm done as a result of my neglect. 2006, we really messed this one up. 2007, we simply did a bad job. I apologize for it. 2010. Sometimes we move too fast, 2011. So House lawmakers began, it sounds, to deconstruct that story a little bit of kind of the humble origins, the beneficent idealism at the heart of Facebook. And in its place, what story really emerges about what Facebook's all about? There was a sort of a more complicated story that emerged about how Facebook has

actually grown, how they have become this enormous data collection and analysis machine. And the fact that those were conscious choices that they made along the way. So they made a point of collecting an enormous amount of data because it made their advertising business better. It allowed them to go to companies and say, well, Google can give you this many data points on their users, but we can give you so many more. And so they have been very proud of their ability to micro-target Americans. And I think the other side of that today that we saw come out during the House testimony is just how they constructed that machine. And how intentionally they did so. This was not an accident that

Facebook ended up with all this data about people. It made conscious decisions at every step of the way to pull users' data into their systems and use it to make more money. Facebook now has evolved to a place where you are tracking everyone. And you are collecting personal information on people who do not even have Facebook accounts. Isn't that right? Congresswoman, I believe that we... Yes or no? Congresswoman, I'm not sure. I don't think that that's what we're tracking. No, you have already acknowledged

that you are doing that for security purposes and commercial purposes. So you're collecting data... I think it's a very convenient narrative that Facebook has been telling about, sort of, whoopsie, we became this global behemoth. But that's not at all how this happened. I mean, this doesn't happen by accident. They have been ruthless in competing

with other social networks, in acquiring things that posed a competitive threat to them, in, frankly, surveilling their users, even outside of Facebook. And that's all what came under the microscope today. And that you're tracking everyone's online activities, their searches. You can track what people buy, correct? Congressman, Congresswoman. You're collecting that data, what people purchase online. I actually, if they share it with us, but Congresswoman. Because it has a share button, so it's gathering. Facebook has the application.

In fact, you patented applications to do just that. Isn't that correct? To collect that data. Congresswoman, I don't think any of those buttons share transaction data. But broadly, I disagree with the character. But they track you. You're collecting medical data, correct,

on people that are on the Internet, whether they're Facebook users or not, right? Congresswoman, yes, we collect some data for security purposes. And you're collecting, you watch where we go? Congresswoman, everyone has control over how that works. I'm going to get to that, but yes, you are. Would you just acknowledge it? Yes, Facebook is, that's the business you're in, gathering data and aggregating that data. that's the business you're in, gathering data and aggregating that data.

I'm kind of struck as a student of Washington that this much more difficult line of questioning came from the House of Representatives. Because we do think of the House as kind of feisty and spunky, but we think of the Senate as being significantly more serious and sophisticated as the adults in the room, so to speak. And yet, it was the house that was really doing the grilling. Yeah, I mean, I think I compared yesterday to a tech support call. Like, this was better. This was like, you know, an intro to computer science class with, you know, with a few random hecklers sitting in the back. Like, this was better. It wasn't totally free of shenanigans, though. Like, there was some wild stuff.

Oh? Well, you know, at one point, this congressman from Missouri, actually the same congressman who had mentioned FaceMash... But I'd like to show you right now a little picture here. He got up and held up a picture

of two people who have become oddly central to Mark Zuckerberg's testimony over the last two days. You recognize these folks? I do. Who are they? I believe, is that Diamond and Silk? That is Diamond and Silk, two biological sisters from North Carolina. I might point out they're African-American. from North Carolina. I might point out they're African-American.

So Dinah and Silk are perhaps the best-known African-American Trump-supporting Internet celebrities. They are two sisters from North Carolina, Lynette Hardaway

and Rochelle Richardson, and they have what is essentially like an Internet talk show where they talk about the news, they are very pro-Trump, and they have sort of become embraced by the Trump world. They have appeared with Donald Trump at rallies,

they have gone on Sean Hannity's show and appeared with Laura Ingraham, and they've been sort of celebrities in the world of right-wing internet personalities. And how does this relate back to Facebook and Mark Zuckerberg and data and security? Well, it's a long story, but the short version is that they kept coming up in these hearings as examples of Facebook's left-wing bias. You know, I don't know what type of a picture this is.

It was taken in a police station or what, in a lineup, but apparently they've been deemed unsafe. Basically what happened, they've been making these videos for several years. At one point they say they got a message from Facebook that said, your Facebook page is unsafe to the community. And we're going to take it back. Diamond and Silk have a question for you. And that question is, what is unsafe about two black women supporting President Donald J. Trump? Well, Congressman, nothing is unsafe about that.

The specifics of this situation, I'm not as up to speed on as I probably would be if I didn't have a hearing. They came up, I sort of lost count. I mean, they must have come up four or five times between the two hearings, such that I think if you were like an alien who dropped down to Earth to observe the testimony of Mark Zuckerberg, and that was all you knew about humanity, like, you would think Diamond and Silk were our supreme leaders. Like, you would think there was no one on Earth

that was more important than Diamond and Silk. So they were evoked by Ted Cruz, by Representative Long. Their story was held up as an example of what happens when social media platforms become overly biased and censorious. So I'd like to ask you, do you subjectively manipulate your algorithms to prioritize or censor speech? Congresswoman, we don't think about what we're doing as censoring speech.

I think that there are types of content like terrorism that I think that we all agree we do not want to have on our service. So we build systems that can identify those and can remove that content, and we're very proud of that work. Let me tell you something right now. Diamond and silk is not terrorism. It's been said many times here that you refer to Facebook as a platform for all ideas. I know you've heard from many yesterday and today about concerns regarding Facebook censorship of content, particularly content that may promote Christian beliefs or conservative political beliefs. I have to bring up Diamond and Silk again because they're actually from my district.

So then is this a reasonable thing for representatives to be focused on in this hearing? Does it have anything to do with the dangers of Facebook and the need for regulation on Facebook? In one sense, no. I mean, the question that we're asking at these hearings, the reason that Mark Zuckerberg came to Washington is to answer questions about data privacy. This doesn't have anything to do with data privacy.

But I have like a grand theory of diamond and silk. Are you ready for it? I am. I think Diamond and Silk are emblematic of one of Facebook's biggest problems. Diamond and Silk explain why Facebook's basic structure may be untenable in our current political moment. So Diamond and Silk have become internet celebrities, but they've also started to edge into territory that Facebook doesn't want. They've spread conspiracy theories. They've talked about Pizzagate and Uranium One deals and all these other sort of false news and

conspiracy theories, the things that Facebook has said it will crack down on. But the problem is that Facebook can't say that. They can't say, we don't like your videos. We don't like your stories. We think they are conspiratorial. We think they constitute hate speech. We think that they are false news or clickbait. They are unwilling to say that to prominent conservative internet celebrities because they don't want to be accused of political bias. And so they have to thread this very tough needle, which is they have to make policies that

will clean up its platform. But they need to make these rules in a way that's politically neutral in an era where this stuff is not evenly distributed between political realms. So if you're trying to enforce policies that will have a neutral impact on both sides, that's a very hard thing to do. So the Roussian theory here is Diamond and Silk is at the heart of an upcoming crisis for Facebook. It wants to root out false news, conspiracy theories online for a million reasons,

and not just in the United States. But if it gets it wrong, because there is more of this conspiratorial journalism on the right, then it will be accused of being biased, which will create a political crisis for Facebook. So it's a no-win situation for Facebook. Yeah, I think it's a really tough one for them. Again, this was not the point of the hearings, right? The point of the hearings was data privacy.

But I think this foreshadowed a future conflict that Facebook is going to have as it tries to become a more responsible media platform. And I think that's something that we can expect to be the topic of maybe future testimonies. Mr. Zuckerberg, you've described Facebook as a company that connects people and as a company that's idealistic and optimistic. I have a few questions about what other types of companies Facebook may be. Kevin, yesterday you said something that really resonated with us, that it's okay for politicians to not totally understand an industry in order to regulate it, but that they at least need to understand the problems

that need to be solved in that industry so that they can bring in experts to address those problems. And the Senate yesterday, you said, seemed pretty far from understanding those problems. Did it feel today like the House had gotten closer? Yeah, I think they were sort of circling in on some of the big issues. Facebook has created its own video series starring Tom Brady that ran for six episodes and has over 50 million views. That's twice the number of the viewers that watched the Oscars last month.

Also, Facebook's obtained exclusive broadcasting rights for 25 major league baseball games this season. Is Facebook a media company? Thank you, Mr. Chairman. I consider us to be a technology company because the primary thing that we do is have engineers who write code and build products and services for other people. There are certainly other things that we do too. I mean, one of the sort of interesting exchanges was when Mark Zuckerberg basically said, look, are we a financial company? You can send money to friends on Facebook Messenger using a debit card or a PayPal account to quote, split meals, pay rent and more, close quote. People can also send money via Venmo or their bank app. Is Facebook a financial institution?

Mr. Chairman, I do not consider ourselves to be a financial institution, although you're right that we do provide tools for people to send money. No, but we do process payments for users and, you know, you can pay for things on Facebook. Are we an aerospace company? We build planes to help connect people and I don't consider ourselves to be an aerospace company. No, but we have planes that we use to deliver internet in parts of the world. And I think the sort of overwhelming feeling that the House probably came out with today was, wow, this thing is a lot bigger and more complex than anyone realized. So you've mentioned several times that you started Facebook in your dorm room in 2004.

15 years, 2 billion users and several, unfortunately, breaches of trust later. Facebook's today, is Facebook today the same kind of company you started with a harvard.edu email address? Well, Mr. Chairman, I think we've evolved quite a bit as a company. I mean, how do you tactically go after something that's that complex? Which department, which committee, which regulator is even equipped to handle something like this? In the Senate, lawmakers had basically asked Mark Zuckerberg how he would like to be regulated. They were so short on ideas that they basically said, why don't you tell us what to do and we'll do it. And in the House, it was different. Mr. Zuckerberg, would it be helpful

if there was an entity clearly tasked with overseeing how consumer data is being collected, shared? One congressman proposed something called the Digital Consumer Protection Agency. One member proposed that maybe data privacy is sort of like clean air and clean water. There need to be clear rules of the road. Or something like how the EPA would regulate emissions. The activities of Facebook and other technology companies should not surprise us. I mean, we've seen it before.

Another congressman compared Facebook to Standard Oil or Ma Bell. Just as we addressed those monopolies in the past, we're faced with that situation today. Maybe it's a monopoly that we just need to break up or somehow make the market more competitive. Right, and those discussions and those proposals suggest that these House members were really grappling with what it is that they're regulating, rather than just kind of poking around in the darkness.

Right. I mean, they're sort of comparing it to things that they know, right? Like, we know how to regulate monopolies. We know how to regulate the environment. We know how to regulate some forms of financial privacy and data around that. So they're sort of doing a comparison study. They're saying, okay, maybe this isn't so different from things that we've seen before. Maybe we actually could start to address some of these things. This is proof to me that self-regulation simply does not work. From my perspective, though, and my colleagues on both sides of the aisle in this committee, we're interested in looking forward.

I do understand that you have agreed that we're going to have to have some rules and regulations. We need some rules and regulations. This is only 13 pages. We need to make sure that there's regulations in place to give you the proper motivation to stay in line with data protection. And one thing that I've been observing, and that's sort of surprising, is that there seems to be bipartisan consensus, almost, on the fact that something should be done to regulate Facebook. It will be regulated.

I think so, in some way. Would you say that that and your newfound interest in Diamond and Silk are probably your two biggest takeaways this week? Yeah. Thank you, Kevin. Thanks, Michael. We'll be right back. Here's what else you need to know today. You realize something when you take this job. It's a big job with a lot riding on you and you feel it. But you also know that this is a job

that does not last forever. You realize that you hold the office for just a small part of our history. On Wednesday, House Speaker Paul Ryan, the most powerful Republican in Congress, announced he would not seek re-election, a decision that deepened doubts over whether Republicans can keep control of the House in this fall's midterm elections. President Trump hasn't exactly made your life as Speaker any easier, even though he obviously signs your bills as a Republican president would. Yeah, we're very different people. I'm from the upper Midwest. I'm not from New York. We're from a different generation.

So we definitely have different styles. And yeah, we had a pretty, we had a lot of friction in our relationship. Ryan said he was retiring from Congress to spend more time with his family. But in an interview with CNN's Jake Tapper a few hours later, Ryan acknowledged a tense relationship with President Trump, which many believe contributed to his decision. Of course, today he told me that President Trump is concerned that Paul Ryan's retiring

and not seeking re-election might encourage other Republicans to also not seek re-election. What do you say about that? We certainly hope that Republicans will continue to remain in the House, especially those that support the president's agenda. That's it for The Daily. I'm Michael Barbaro. See you tomorrow.