Transcripts For CSPAN2 Facebook Co-Founder Mark Zuckerberg T

The committee will come to order. Without objection the chair is authorized today declare a recess of the committee at any time. This hearing is entitled an examination of facebook and its impact on the Financial Services and housing sectors. I now recognize myself for five minutes to give an Opening Statement. Today, were here to examine the impact of facebook on the Financial Services and housing sectors. Our sole witness is facebooks chairman and ceo, mark zuckerberg. Facebooks plans to create a digital currency, libra, and a digital wallet raise many concerns relating to privacy, trading risk, discrimination, opportunities for diverse owned financial firms, National Security, Monetary Policy, and the stability of the Global Financial system. I and other democrats have called for a moratorium on facebooks development of this digital currency, libra, and digital wallet until congress can examine the issues associated with a Big Tech Company developing these Digital Products and take action. As i have examined facebooks various problems ive come to the conclusion it would be beneficial for all if facebook concentrates on addressing its many deficiencies and failures before proceeding further on the libra project. Lets review the record. First on diversity and inclusion. Facebook has utterly failed. Facebooks executive ranks and workforce continue to be mostly white and male. Since reverend Jesse Jackson and the Rainbow Push Coalition called upon Silicon Valley companies to release its diversity statistics more than five years ago, the representation of africanamericans and hispanics has increased bide 2 . Facebook told us they have 0 managed by diverse firms. Unfair housing. Facebook has been sued by the National Fair Housing Alliance for enabling advertisers to engage in discrimination on its advertising platforms. The u. S. Department of housing and urban development has also filed an official charge of discrimination against facebook for its advertising practices, including the companys own ad delivery algorithms which were found to have a discriminatory impact when advertisers did not target their audience in discriminatory ways chtd i understand that facebook has refused to cooperate with h. U. D. s fair housing investigation by refusing to provide relevant data. On competition and fairness, facebook is the subject of an antitrust investigation by the attorneys general of 47 states and the district of columbia. On protecting consumers, facebook was fined 5 billion by the federal trade commission for deceiving consumers and failing to keep their data private. On elections, facebook enabled the russian government to interfere with our election in 2016 with ads designed to pit americans against each other. Suppress the vote and boost trump. For example, facebook allowed a counterfeit black lives matter web page to operate with the goal of discouraging africanamericans from voting. Three years later, these activities are still continuing on facebook. We learned just this week that russia and iran are using the same tactics to meddle in our next election. Now on political speech. Last week, you announced that facebook would not be doing Fact Checking on political ads given anyone facebook labels a politician a platform to lie, mislead, and misinform the american people. Which will also allow facebook to sell more ads. The impact of this will be a massive voter that removes the freedom of eclipse. Your claim to promote freedom of speech does not ring true. Each month, 2. 7 billion people use your product, over a third of the worlds population. That is huge. That is so big it is clear to me and anyone who hears this list that perhaps you believe you are above the law and you are aggressively increasing the size of your company and are willing to step on or over anyone including your competitors, women, people of color and even our democracy to get what you want. All of these problems as outlined and given the companys size and reach it should be clear why we have concerns about your plans to establish a Global Digital currency that will challenge the us dollar. You have opened a serious discussion about whether facebook should be broken up. The chair recognizes the Ranking Member mister mchenry for an Opening Statement. Thank you for your appearance. Today is a trial on American Innovation. There is a growing concern about the Role Technology plays in our lives that is warranted, it is necessary. Technology has led to greater prosperity, more freedom of expression and the ability to transcend space and time to connect us with one another. A powerful tool. A powerful tool for our society developed in the United States. But there is also a downside to all of this. The vitriolic social media is frightening. The growing inequality between those who have access to the latest tech gadgets remain on the coasts while folks living in Rural America are still trying to get the same connectivity necessary to compete in a global marketplace not to mentioning ziad he, a deep cultural moment for is not as politicians but americans. That nervous feeling you need to check your phone throughout the day, something that is a cultural occurrence for all of us especially members of congress, most of whom in this room are doing that right now. Theres a lot of anger out there. Now it is directed at the architects of this system. That is why you are here today. You are one of the titans of what we call the digital age, enormous responsibility and enormous the innovation you have brought, maybe it is not about libra, not just about some housing ads and maybe it is not really even about facebook at all. It is that larger question. In fair or not fair youre here to answer for the digital age but of course you are not americas first innovator and we hope you are not americas last. This is not the first time america has faced difficult questions about technology. Throughout industries invasion at history the theme is the exploitation of fear. Politicians enabled by special interest and lack of understanding of new technologies use fear to justify what is ultimately a power grab, new laws, new regulation but ways to centralize power in washington where other systems of government, some of this has led to comical results. We hope to avoid it now but as one example there was a time legislators pushed for what was then called red flag laws which required vehicles, socalled horseless carriages to stop on the side of the road and disassemble the automobile until equestrians are livestock was sufficiently pacified. Other times the use of fear was not so funny. Last hearing on libra for example was a moment members of congress on this day us actually compared the technology of libra to the terrorist attacks of september 11th. Will eventually yield . I have my own quality will potential yield . The time belongs to the gentleman from north carolina. Thank you for taking the bait. I have my qualms about facebook and libra, i do, and the shortcomings of big tech. There are many. If history has taught us anything it is better to be on the side of American Innovation, competition and freedom to build a Better Future for all. Progress is not preordained. American domination of free speech and global rights is not preordained. Let us not forget the wave of innovation is spreading across the world with or without us. That is why i believe American Innovation is on trial this day in this hearing. The question is are we going to spend our time trying to devise ways for government planners to centralize and control as to who, when and how innovators can innovate . Or will we spend time contemplating and leading the way on the question of whether it will be American Innovation that leads the next century being led by American Values the notion we have of the rule of law and free speech rights and american driven jobs and innovation. Are we going to spend our time building a Brighter Future for americans who are trying to tear each other apart . I yield back. I would like to welcome todays witnesses. We only have one. Mister mark zuckerberg, chairman and chief executive officer of facebook, this is mister zuckerbergs first appearance before this committee but i believe he needs no introduction. Without objection your written statement will be made part of the record. You have 5 minutes to summarize your testimony. When you have one minute remaining a yellow light will appear. At that time i will ask you to wrap up your testimony so we can be respectful of Committee Members time. You are recognized for 5 minutes to present your oral testimony. Thank you. Members of the committee, thank you for the opportunity to testify today. As we sit here there are more than 1 billion people around the world who dont have access to a bank account but could through mobile phones if the right system existed. That includes 14 Million People in the us. Being shut out of the Financial System has real consequences for peoples lives and often the most disadvantaged people pay the highest price. People pay for too high cost and have to wait too long to send money to their families abroad. The Current System is failing them. The financial industry is stagnant. There is no Digital Financial architecture to support the innovation we need. This problem could be solved and libra could help them. The idea behind libra coming to be as secure as sending a message. And it is a highly liquid asset. I believe this is something that needs to get bills but im not the ideal messenger for this right now. We face a lot of issues the past few years and i am sure a lot of people wish it was anyone but facebook making these choices. Theres a reason we care about this. Facebook is about putting power in peoples hands. Our Services Already give people a voice to express what matters to them and build businesses that create opportunity. Giving people control of their money is important too in a simple, secure and stable way to transfer money is empowering. Over the longterm this means more people transact on our platforms. That will be good for our business but even if it doesnt i still think this could help people everywhere. Before we move forward there are important risks that need to be addressed, questions of Financial Stability, fighting terrorism and more im here to discuss those risks and how we plan to address them but i also hope we get a chance to talk about the risks of not innovating. As we debate these issues the rest of the world is waiting, china is moving quickly to launch a similar idea in the coming months. Libra will be back by dollars and i believe it will extend americas Financial Leadership around the world as well as our Democratic Values and oversight but if america doesnt innovate our Financial Leadership is not guaranteed. I actually dont know if libra is going to work but it is important to try new things as long as you do so responsibly. That has made america successful and why Tech Industry has led the world. So we put this idea out into the world and start a conversation with regulators, experts and government and this is an important part of the process. What we are discussing is too important for any company to undertake on its own. We found the Libra Association, coalition of 21 companies and nonprofits working to give everyone access to financial tools but even though the Libra Association is independent and we dont control that i want to be clear, facebook will not be part of launching a libra Payment System anywhere in the world even outside the us until us regulators approved. Last time i testified i talked about taking a broader view of our responsibility, making sure our services are used for good and preventing harm, and other aspects of our work today as well. People should not be discriminated against on any of our services. We have policies to prevent hate speech and remove harmful content that discrimination can show up and how ads are targeted and shown too, part of a settlement with civil Rights Groups, we band advertises from using age, gender and zip code to target housing, employment Credit Opportunities, limited targeting for the dead too, part of our commitment to support civil rights and prevent discrimination. I also know that we need more diverse perspectives, diversity leads to Better Services for our community. We made diverse city a priority in hiring and we will submit that within 5 years more than 50 of our workforce will be women, people of color and other underrepresented groups. Women and technical and business roles and underrepresented, we have a long way to go. Chairwoman waters, Ranking Member mchenry and other members of the committee this has been a challenging few years for facebook. I recognize we plan Important Role in society and have unique responsibilities. I feel blessed being in a position, you make a difference in peoples lives. As long as i am here i am committed using a position to push for big ideas that i believe can help empower people. Im looking forward to answering your questions. I recognize myself for 5 minutes. It is no secret facebook allowed russia to undermine and divide our country through divisive online ads. The Senate Investigation discovered africanamericans were targeted the most by russia specifically in places where black lives matter groups were the most impacted. Despite all your technological expertise russia and iran are at it again for the upcoming elections. Last week you announced a new ad policy that gives politicians a license to live so you can earn more money off of this division. Facebook changes the rules when it can benefit itself. Last year facebook banned all crypto currency ads on this platform because, quote, they are frequently associated with misleading or deceptive practices, quote,. It seems fair. Earlier this year facebook rolled back the crypto currency, a block Chain Company and announced its own crypto currency. Tell us what changed. How did crypto currency go from being misleading last year and then become the means for Financial Inclusion this year. It seems to me you shifted your stance because you realize you can use your size and users data to dominate the crypto currency market. You reinstated crypto currency ads because you had plans to start your own crypto currency. This brings me back to your new policy on political speech. How does this new policy benefit you . It seems a policy that allows politicians to lie, mislead and deceive would also allow facebook to sell ads to those politicians thus making your company more money. How does facebook benefit . Thanks for those questions. I would like to address all the things you mentioned. On elections you are right that we were on our back foot in terms of preventing russia from attempting to interfere in our election. We spent the last few years Building Systems that are more sophisticated than any company has at this point and a lot of governments too for defending against foreign interference. This monday we announced we proactively identified network of fake russian accounts a few networks that iranian fake accounts that we proactively took down which as you say signals that these nationstates are attempting to interfere but i hope will give us some confidence that our systems are more sophisticated to proactively identify and address these. On your question about political ads, from a business perspective the small percentage of our business that is made of the medical ads does not come close to justifying the controversy this incurs for our company so this is not about money. This is on principle i believe in giving people a voice. I believe ads can be an important part of voice. I believe especially in the political process for challenger candidates and vocal candidates are advocacy groups whose message might not otherwise be covered by the media having ads can be an important way to inject your message let me interrupt for a minute. Are you telling me, as you said to me before, you plan on doing no Fact Checking on political ads . Chairwoman, our policy is we do not fact check politicians. The reason for that is we believe in a democracy it is important people can see for themselves what politicians are saying. Political speech is some of the most scrutinized speech already in the world. Do you fact check on any ads. Describe what you find. Facebook does not fact check with we have feedback the people in our community dont want to see viral hoaxes. Let me be clear. You do no Fact Checking on any ads, is that correct . We work with a set of independent fact checkers. Somebody fact checks ads . You contracted someone to do that . Is that right . Yes. Tell me who is it they fact checked on . Chair the woman, what we do when content is getting a lot of distribution and is flagged by members of our community or our technical systems, it can go to acute to be reviewed by a s