Facebook was born, lives and thrives in scandal. It’s been lawless for years

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<span>Photograph: Mandel Ngan/AFP/Getty Images</span>
Photograph: Mandel Ngan/AFP/Getty Images

Facebook is having a rough go of it these days, so you might expect the company to be in trouble. For instance, at one Senate judiciary hearing, the Republican senator John Kennedy of Louisiana let Facebook’s Colin Stretch have it.

Kennedy confronted Stretch, the company’s former general counsel, with a report that Facebook can micro-target emotionally vulnerable teens, asking: “Was that reporting wrong?” Stretch responded with a standard Facebook line: “That reporting relied on an internal document that was overstated.” It didn’t satisfy Kennedy. “Your power sometimes scares me,” he said. Another day, another PR black eye for Facebook.

Yet if you don’t recognize this particularly exchange, it’s because it happened more than three years ago, before the whistleblower du jour, Frances Haugen, even joined Facebook. And in the time since that hearing, the company’s stock has doubled.

Indeed, Facebook was born, lives and thrives in scandal. There were scandals before this hearing, such as violations of privacy that led to a Federal Trade Commission consent decree in 2012. There were scandals after this hearing, such as Facebook being exposed as facilitating a genocide in Myanmar. In 2019, the US government fined Facebook $5bn for violating its commitment to the government to stop deceiving its users over their ability to control the privacy of their personal information. In 2020, the House antitrust subcommittee revealed documents showing Mark Zuckerberg as explicitly predatory in his business methods, which were supplemented by the Federal Trade Commission complaint filed earlier this year. And yet, we see almost no action of consequence.

Despite all the light and heat, Facebook is still a globe-straddling monopoly over our information commons

So forgive me, as a longtime critic of Facebook, for not seeing this latest round of bad press – which reveals nothing we don’t already know – as not getting to the heart of the problem.

That problem is simple. Lawlessness pays. We’ve known that Facebook is lawless and reckless for years. And yet despite all the light and heat, Facebook is still a globe-straddling monopoly over our information commons. One man is still in charge of it, making all key policy decisions, and he is worth $100bn and considered an important leader and philanthropist. To put it differently, when a bank robber robs a bank, blame the bank robber. When a bank robber robs 20 banks, and announces where he’s going to steal from next, and does it in broad daylight, repeatedly, and no one stops him, we should be blaming the cops. And that’s where we are with Facebook.

Haugen, while providing useful documents showing that Facebook knows what we all know – that Instagram is bad for teenage girls and that Zuckerberg is not a paragon of virtue – has added momentum to the call to do “something”. And there’s a feeding frenzy of media outlets and political leaders who laud the heroism of a wealthy Silicon Valley insider telling us what we already know. One Scottish lawmaker asked Haugen point blank: “Is Facebook evil?”

But all of this focus on Facebook and the personalities involved misses the point. If we set up a policy system that offers a reward for destroying our social fabric in the neighborhood of $100bn and unlimited power, then this is what we’ll get. The problem is not Facebook, it’s a policy regime that creates an incentive for monopolization, securities fraud and surveillance advertising.

Related: Facebook revelations: what is in cache of internal documents?

The more important question is what policymakers are going to do about the problems that Facebook presents. There are two basic issues. First, Facebook has immense market power, and antitrust law has been weakened by courts and economists over decades. Despite all the scandals over Facebook, a judge recently dismissed the Federal Trade Commission suit against the company because, he said, the government hadn’t proved Facebook was a monopoly. The suit has since been refiled, but even if it does go forward, it will go to trial in 2023, with a remedy phase stretching into 2025. That’s ridiculous. The standards for proving harm have to be lower, and the courts must move faster.

Second, Facebook and all social media and internet advertising firms get to use detailed dossiers to target us with ads wherever we go online. That’s a conflict of interest, because it encourages a business model in which communications facilities try to addict us so they can sell us more ads. Unlike a phone network, which is not financed by ads, social media companies pick and choose incendiary content to promote. This both creates filter bubbles of conspiracy theory-minded communities and redirects advertising from legitimate publishers, such as local newspapers, towards ad monopolists such as Facebook. This policy failure also has policy roots: for decades, libertarian judges and policymakers have fought, successfully, against rules that prohibit such conflicts of interest in business and made sure that rules on data or privacy have been voluntary or poorly enforced.

In order to address the problem, we the people would have to empower our government to govern

And this brings us to the reason we haven’t done anything about Facebook. In order to actually address the problem of dominant market power and conflicts of interest, we the people would have to empower our government to govern. We’d have to pass laws strengthening antitrust enforcement, we’d have to bar corporate conflicts of interest such as a communications firm vertically integrated into an advertising network, and we’d have to restore the rule of law against the powerful when they commit crimes.

Doing so is necessary, and long overdue. And policymakers are moving in that direction. In New York, for instance, state lawmakers are debating an abuse-of-dominance bill that would ramp up antitrust enforcement. At the FTC, enforcers are considering using new regulatory tools to address unfair methods of competition. In Ohio, the attorney general is using public utility law to take on big tech. At some point, hopefully, enforcers will even use criminal law and put handcuffs on powerful lawbreakers.

Congress itself is taking action. Lawmakers are musing on antitrust bills that would break up big tech, though in all likelihood the only bill that will pass is a bill to ban self-preferencing that would have little impact on Facebook. The legislature is also considering changes to Section 230 of the Communications Decency Act, which lets big tech firms escape liability for their products.

Ultimately, any change to address Facebook will affect far more than the social media giant, because Facebook is merely the pacesetter of an economy full of concentrated corporate actors who use similar tactics. We’d have to stop the rampant bank robbery not just of Mark Zuckerberg, but of everyone doing it. That would be a glorious thing to do, to restructure our economy so that predatory behavior is actually penalized, instead of rewarded.

So let’s get to it. In the meantime, I don’t want to hear another story about that nefarious bank robber, unless there’s a recognition that Facebook’s problems are downstream from the failure of our democratic institutions to fix them.

  • Matt Stoller is a writer and former policymaker who focuses on the politics of market power and antitrust

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