The Daily - Wednesday, Apr. 11, 2018

Episode Date: April 11, 2018

Mark Zuckerberg, the Facebook chief executive, began two days of marathon hearings in Washington, answering tough questions on the company’s mishandling of data. But the hours of testimony about the social media company’s practices seemed to focus on a larger, more difficult question: What is Facebook, exactly? 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 one of Mark Zuckerberg's two-day marathon hearings in Washington. Behind the hours of questioning about Facebook's practices was a larger and more difficult-to-answer question. What is this thing? It's Wednesday, April 11th. So I don't go to a lot of congressional hearings.

In fact, this is my first congressional hearing in D.C. And so I didn't know what to expect. I showed up a few hours early, and it was a total zoo. The internet is getting dark, and we owe it all to Mark. The internet is getting dark, and we owe it all to Mark. And it was a total zoo. Like, I cannot tell you how many hundreds of people were waiting outside this tiny little hearing room. Kevin Roos was at the hearing on Tuesday. And there were protesters in costumes. There was a woman dressed up as a Russian troll, which I thought was very clever.

There were, you know, floods of TV cameras. And yeah, it was sort of this circus, like it was packed. I mean, wall to wall, the entire thing was filled. There were 40 senators who were questioning Zuckerberg. So even by sort of their standards, this is a large group. You were actually in the room for this. What was it like when Zuckerberg walked in? Well, it was very, very quiet. I mean, so he started walking in,

the room sort of gets hushed, and then the cameras start going off. It just clicked, click, click. I think this is going to become like an iconic picture. It's just Zuckerberg sitting down at his desk to prepare to testify, and just the swarm of photographers who were crowding around him. I mean, it really did look like this was a moment that everyone had been anticipating for a long, long time.

And he sits down and pulls out his notes, and then they're off. We welcome everyone to today's hearing on Facebook's social media privacy and the use and abuse of data. And it was about five hours from start to finish. We have 44 members between our two committees. That may not seem like a large group by Facebook standards, but it is significant here for

a hearing in the United States Senate. And I was through this whole thing. I was like in the front row. The front row? Front row of press. So there were a couple rows of people behind Zuckerberg and then press section started and I was right up there. And so, actually, if you look on C-SPAN,

I don't want to brag, but my arm and part of my hand are visible in about five hours worth of testimony. Written into history. Yeah, I should have gotten a manicure. And so it's my pleasure to recognize the chairman of the Commerce Committee, Chairman Thune, for his opening statement. Thank you, Chairman Grassley.

Today's hearing is extraordinary. It's extraordinary to hold a joint committee hearing. It's even more extraordinary to have a single CEO testify before nearly half of the United States Senate. But then Facebook is pretty extraordinary. It started off pretty tense. Let me just cut to the chase. If you and other social media companies do not get your act in order, none of us are going to have any privacy anymore. There were some opening statements from some of the senators, Thune, Grassley, Nelson,

some of the senators who have been leading on these issues, and they were pretty aggressive. How can American consumers trust folks like your company to be caretakers of their most personal and identifiable information. Zuckerberg had a long opening statement about how he had made mistakes. We didn't take a broad enough view of our responsibility. And that was a big mistake. And it was my mistake. And I'm sorry. I started Facebook. I run it. And I'm responsible for what happens here. And he started this thing in his dorm room. He kept mentioning his dorm room at Harvard. I started Facebook when I was in college. We've come a long way since then.

Kevin, why do you think that Zuckerberg kept mentioning the origins of Facebook in a dorm at Harvard? He did it over and over. So we have made a lot of mistakes in running the company. book in a dorm at Harvard. He did it over and over. So we have made a lot of mistakes in running the company. I think it's pretty much impossible, I believe, to start a company in your dorm room and then grow it to be at the scale that we're at now without making some mistakes. Well, I think for one, it's just a sort of humanizing detail. I mean, a lot of people know the story of Facebook, this sort of American dream narrative. He was, you know, just a kid in a dorm and now he's one of the richest people in the world, only in America, et cetera, et cetera. But I think there was an interesting strategic place there

because on one hand, yes, it's a humanizing detail. He needs more of those. He wants more of those. On the other hand, if your goal is to convince a bunch of senators that you are old enough and mature enough to be in charge of this gigantic technology platform that affects billions of people's lives around the world, you might not want to remind them how recently you were in college.

I realize the issues we're talking about today aren't just issues for Facebook and our community. They're issues and challenges for all of us as Americans. Thank you for having me here today, and I'm ready to take your questions. And then it sort of went off the rails. I mean, I never thought that this was going to be the most nuanced discussion of technology policy and the intricacies of digital advertising. Why not? Well, I've watched a couple congressional hearings before.

Like, these are not subject matter experts, most of them. Therefore, you consider my personally identifiable data, the company's data, not my data. Is that it? No, Senator. Actually, at the first line of our terms of service, say that you control and own the information and content that you put on Facebook.

And so it felt a little like a five-hour tech support call. You know, it felt like trying to explain to someone very patiently how their iPhone works and what to do if it's on the fritz. There will always be a version of Facebook that is free. It is our mission to try to help connect everyone around the world and to bring the world closer together. In order to do that, we believe that we mission to try to help connect everyone around the world and to bring the world closer together. In order to do that, we believe that we need to offer a service that everyone can afford,

and we're committed to doing that. Well, if so, how do you sustain a business model in which users don't pay for your service? Senator, we run ads. For most of them, I would say their understanding of just the basics about Facebook, not even this Russia stuff for Cambridge Analytica, but just how does this thing work? How does it make money?

How do people interact with it? Like that seemed to elude some of the senators. So do people now give you permission to track specific devices in their contract? And if they do, is that a relatively new addition to what you do? Senator, I'm sorry, I don't have that. Am I able to opt out? Am I able to say it's okay for you to track what I'm saying on Facebook, but I don't want you to track what I'm texting to somebody else off Facebook

on an Android phone? Oh, okay. Yes, Senator. Right. This kind of confusion about exactly how Facebook works seemed very much like the theme of the day. And what's interesting about that is that Facebook has become all-powerful. We know that they haven't done a great job with this great power that they have. that they haven't done a great job with this great power that they have. And that a lot of these senators are angry on behalf of their constituents for this kind of nebulous threat that Facebook represents.

But what it seems like the senators and maybe the rest of us don't quite know is like, where do you go from there? Because we don't really understand how Facebook works. Right. And to be clear, like, I write about Facebook for a living and I don't understand how Facebook works, right? Like it's sort of fractal in that the moment you start thinking that you understand part of it, you discover that there are 10 different parts of it that you don't understand at all. And because everyone's Facebook feed is tailored to their specific interests, like no two people see the same

thing when they log on to Facebook. It's different. It's literally different for everyone. And so that makes it very hard to sort of create a unified theory of Facebook and how it works. And I think that's the thing that I was seeing is just these senators who are trying to grapple with, OK, is this a technology company? Is it a website? Is it a media company? Is it a political campaign tool? Is it something that we should regulate like it's a news publisher? Is it something that we should regulate like it's a bank? Is it something that we should regulate in some other way that we haven't figured out yet? And it really seemed like that was sort of the essential question. It's not not what did Facebook do in 2016?

It was like, what is Facebook? Mr. Zuckerberg, I come in peace. I was particularly struck by this interaction that Zuckerberg had with John Kennedy, who is a Republican senator from Louisiana and sort of a guy who's been tough on tech executives before. I don't want to vote to have to regulate Facebook, but by God, I will. A lot of that depends on you. I'm a little disappointed in this hearing today. I just don't feel like that we're connecting. So let me try to lay it out for you from my point of view. I think you're a really smart guy. And I think you have built an extraordinary American company. And you've

done a lot of good. Some of the things that you've been able to do are magical. you've been able to do are magical. But our promised digital utopia, we have discovered, has minefields. There's some impurities in the Facebook punch bowl. He started off pretty strong. I think he expressed a lot of the sort of frustration that some people in the room were feeling. And then it kind of went off the rails.

As a Facebook user, that some people in the room were feeling. And then it kind of went off the rails. As a Facebook user, are you willing to give me more control over my data? Senator, as someone who uses Facebook, I believe that you should have complete control over your data. Okay. Are you willing to go back and work on giving me a greater right to erase my data? Senator, you can already delete any of the data that's there or delete all of your data. Are you willing to work on expanding that? Senator, I think we already do what you're referring to, but certainly we're

always working on trying to make these controls easier. Are you willing to expand my right to know who you're sharing my data with? Senator, we already give you a list of apps that you're using, and you signed into those yourself and provided affirmative consent. And Zuckerberg just keeps saying, Senator, you can already do this. We already built this. It already exists. You can see him sort of patiently explaining, like, yes, we've thought about this. Yes, we've addressed it. Are you willing to give me the right to take my data on Facebook

and move it to another social media platform? Senator, you can already do that. We have a download your information tool where you can go get get a file of all the content there, and then do whatever you want with it. Then I assume you're willing to give me the right to say, I'm going to go on your platform, and you're going to be able to tell a lot about me as a result, but I don't want you to share it with anybody. Yes, Senator, and I believe you already have that ability today. Yes, Senator, and I believe you already have that ability today. People can sign on and choose to not share things and just follow some friends or some pages and read content if that's what they want to do. Okay. Let me be sure I understand.

I'm about out of time. Boy, it goes fast, doesn't it? This exchange kind of feels like a microcosm of this entire hearing because Kennedy is angry. He wants Facebook to do better, but he doesn't quite understand what the problem actually is. And ultimately, the questions that senators like Kennedy are asking are kind of beside the point. Right. But I think there's some value in forcing someone like Mark Zuckerberg to answer really simple questions about Facebook in a straightforward and detailed way. So simple questions, but important ones to get on the record. Mr. Zuckerberg, would you be comfortable sharing with us the name of the hotel you stayed in last Um, uh, no.

I think that may be what this is all about. Your right to privacy, the limits of your right to privacy. But then there were sort of the oddball questions that just seemed like people had maybe thought of them on the fly, or it was their pet issue, or their bill that they wanted to push. It was sort of a grab bag of concerns. Do you have any idea how many of your users actually read the terms of service, the privacy policy, the statement of rights and responsibilities? I mean, actually read it? Senator, I do not. My state, I'm from West Virginia. And thank you for visiting. And next time you visit, if you would please bring some fiber

because we don't have connectivity in our rural areas like we really need, and Facebook could really help us with that. One guy, like, whipped out a tablet and, like, showed off his Facebook profile and said, I am a proud member of Facebook. I mean, it was really surreal. Now, my son, Charlie,

who's 13, is dedicated to Instagram, so he'd want to be sure I mentioned him while I was here with you. I mean, this always happens, right? Like, I remember listening to Congress grilling Wall Street executives in 2009 after the financial crisis, and they were asking all kinds of crazy questions, too. But what came out of that was a sense that this was a sector that had to be reined in. Things had gotten out of control, that there needed to be comprehensive regulation of the sector that would keep something like the financial crisis from happening again. And out of that process, we actually did get regulation. I mean, Dodd-Frank was the big bill that passed through Congress that tried to address

some of the causes of the 2008 financial crisis. And the Congress people in those hearings with the bank executives, they were not experts on mortgage-backed securities or credit default swaps, but they still managed to understand in general terms what the issue was. These banks were taking on too much risk. And then they had their staffers and experts who actually knew the subject very well come in and draft legislation that would address those problems. And I think that's the step we're not seeing yet with Facebook and with the tech sector is we haven't yet identified what the problems are that we're trying to solve. And Congress doesn't seem to be

united on that. And I'm not even sure they're particularly close to identifying what they're trying to do. And then after that, going out and actually doing it. Who's your biggest competitor? Senator, we have a lot of competitors. Who's your biggest? I think the categories of, do you want just one? I'm not sure I can give one, but can I give a bunch? To give the Senator some credit. I mean, there were a number of interesting and relevant questions. I think Zuckerberg got pressed by Lindsey Graham about some of the questions around whether Facebook is a monopoly. Did anyone at Facebook have a conversation at the time that you became aware of this breach and have a conversation wherein the decision was made not to contact the users. He got pressed by Kamala Harris,

senator from California, about some specific issues related to Cambridge Analytica and Facebook's failure to notify users. So there was some ground broken. I don't want to give the impression that this was all just a total three-ring circus. But I do think there were a number of occasions on which just asking a follow-up question that was more pointed. I think Zuckerberg was very good at answering the questions that he wanted to answer. Part of that is because he's been rehearsing for this.

He hired a team of fancy experts to come in and prepare him for this session, like presidential candidates would do before a debate. So he was prepared for just about anything. But they didn't really plumb the depths of what people might have expected them to ask. So would you work with us in terms of what regulations you think are necessary in your industry? Absolutely. Okay. Would you submit to us some proposed regulations? Yes. And I'll have my team follow up with you so that way we can... How do you think that he did? I think he did pretty well. I mean, I think he started off pretty nervous, but I think as it

wore on, he started to realize like, this is not going to be a totally hostile, totally sophisticated group of prosecutorial senators. This is going to be a mixed bag. And I think he got a lot more comfortable as the day went on. But I think he did well. And, you know, investors think he did well, too. The stock's up almost 5%. So clearly he reassured some people. One of the key issues here is, is Facebook too powerful? Are you too powerful?

And do you think you're too powerful? But I want to touch on this other thing that I was feeling today, because I felt it pretty acutely when some of the senators were talking to Mark Zuckerberg and sort of asking him for advice on maybe how they should regulate him, how they should think about these things. It felt a little bit more like a tutorial than a regulatory hearing. And I really started thinking, you know, these senators are part of a legislative body that makes the laws for a population of 300 and some million people. Mark Zuckerberg, by himself, controls a sort of supranational entity that's 2.2 billion people.

So he is like, in a very real sense, more powerful than any of these individual senators, real sense more powerful than any of these individual senators or maybe even the Senate as a whole. He can't launch nuclear weapons or start a war or collect taxes, but he can shape the behaviors and the mental states and the information diets of many, many more people around the world than these senators can address with their work. As a technology writer, I assume you more or less knew the answers to most of the questions that these senators were asking. But did you learn anything in these hearings? Yeah, I think I learned a lot about how senators and lawmakers

view technology companies and view the work that firms like Facebook do. And I think it's sort of a mixture of reverence and skepticism and a little bit of fear. And I think all of that mixed together explains a lot about how the next few years are going to go for technology companies. They're not getting less powerful, right? And in the absence of new regulation or something crazy happening in the economy, they're not going away. And so I think we'll start to see more and more of these types of hearings. And my hope is that with each successive hearing, with each successive opportunity that lawmakers have to ask questions of people like Mark Zuckerberg, they'll get a

little bit better and a little bit better. And pretty soon we'll be having the types of discussions we need to be having. Kevin, thank you very much. Thanks for having me. I should ask you like a Dick Durbin style question. Which hotel are you staying at tonight? I'm staying on my brother's futon, which is the

nicest hotel in Washington. Enjoy. I will. I will. Have a good night, guys. We'll be right back. Here's what else you need to know today. FBI agents who raided the offices of President Trump's personal lawyer, Michael Cohen, were looking for records of payments to two women who claimed they had affairs with Trump, as well as information about the role of the publisher of the National Enquir the payments, but critics of the president have claimed that they amount to illegal campaign contributions to Trump because they helped him win the White House by hiding politically damaging stories. On Tuesday, Trump continued to lash out at the Department of Justice for the raid, calling it a total witch hunt and saying, quote, attorney-client privilege is dead. Good afternoon.

Good afternoon. As you know, the president welcomed the emir of Qatar to the White House today. During a news conference at the White House, a reporter asked Press Secretary Sarah Huckabee Sanders about the possibility that the president would fire Special Counsel Robert Mueller over the raid, which began with a tip from his team. Does the president believe he has the power to fire Special Counsel Robert Mueller? Does he believe that's within his power? Certainly believes he has the power to do so. In fact, the president does not have the power to do so.

In fact, the president does not have the power to do so. That power lies with the deputy attorney general, Rod Rosenstein, who the Times reports personally authorized the raid on Cohen's office. That's it for The Daily. I'm Michael Barbaro. See you tomorrow.