Daily Digest 4/13/2018 (Why Facebook hearings didn't move the needle on regulation)

With bipartisan agreement, members of Congress said that Silicon Valley needed to be reined in with new regulations. But time and again, when the most pressing issues have landed on Capitol Hill — like gun violence, school shootings, immigration and border control — Congress has declared five-alarm fires only to fail to follow through on major legislation. The current zest for new privacy laws is also likely to stall as lawmakers wrestle with the technical complexities and constitutional vexations sure to emerge with any legislation to control content on the internet. Beyond the typical political gridlock that has stymied action in Congress, technology and the companies that sell access to it are particularly protected. The Facebook hearings revealed a vast knowledge gap between Silicon Valley and the nation’s capital, where lawmakers struggled to grasp how the technology works and which problems — misinformation, sharing of data to third parties or political biases coded into algorithms — needed to be addressed. Inaction does not reflect a lack of will so much as a failure of expertise.

[Commentary] While online rights are coming into question, it’s worth considering how those will overlap with offline rights and civic engagement. We need a conversation about data protections, empowering users with their own information, and transparency — ultimately, data rights are now civic rights.While the US still lacks such data standards, the European Union’s General Data Protection Regulation (GDPR), scheduled to take effect in May, demonstrates a path toward reliable online privacy balanced with transparency. 

There’s plenty of documentation on how the GDPR will affect the practices of consumer-oriented companies and journalism. But the social sector also needs to take note. From civil society organization to think tanks, academia, and philanthropy, these rules will have important, unexamined implications and opportunities outside of Europe. Though the issue isn’t sparking marches and mass protests, data rights should not be left to a few technical experts — or representatives with no tech background. Because data rules affect everyone in different, unequal ways, we need full, informed democratic participation of everyday people. After all, this may be one of the most fundamental choices the US will make over the next decade.

[Hollie Russon-Gilman and Elena Souris work with New America.]

Some 45 times — I was counting — the Facebook CEO told members of Congress that we’re in control of our data, when it’s plainly impossible for most people to figure out how to do so. That makes it hard to buy what he’s selling, even if it’s free. Zuckerberg has never really explained just how much data Facebook collects and what it does with it. “We never sell your data,” he said repeatedly, even though that’s not really the issue. Whenever he was questioned why Facebook collects so much data, he wheeled out: “You have control over your information.” Facebook is hiding behind bad product design. Rather than minimizing the amount of data it collects or setting defaults that truly prioritize privacy, Facebook presents a theater of controls and settings that few people use.

We’re trusting services like Facebook with our data, and that trust should come with concrete legal responsibilities. To make that happen, Yale Law professor Jack Balkin proposes designating cloud providers as “information fiduciaries,” binding them an industry-wide code of conduct modeled after similar designations in law, medicine, and finance. In the abstract, the rule would require Facebook and other companies to not act against user’s interest, leaving courts to decide the penalties when they do. Crucially, Balkin’s fiduciary rule could be put in place by any number of agencies, including state-level legislatures, letting privacy advocates sidestep Congress entirely.

Mark Zuckerberg appeared on Capitol Hill to talk about data privacy. But several lawmakers from rural parts of the country used the opportunity to ask the Facebook CEO to help bring high-speed internet access to their rural constituents. Facebook has rolled out several initiatives to bring low-cost and free broadband to hard to reach areas of the world, such as India and Africa. Now US lawmakers say they'd like to talk to Zuckerberg about focusing those efforts closer to home. "Next time you visit [West Virgnia], 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," said Sen. Shelley Moore Capito (R-WV).  Rep. Morgan Griffith (R-VA) said he'd also like to talk to Zuckerberg about bringing high-speed connectivity to parts of his state. "My district is very similar to West Virginia as it borders it," he said. "We have a lot of rural areas. Can you also agree, yes or no, to update me on that when the information is available?" Zuckerberg said he would. And he explained some of the initiatives the company has been working on.

[Commentary] On April 17, the House Commerce Subcommittee on Communications and Technology will hold a hearing on paid prioritization -- an issue that is central to the net neutrality debate. While most internet service providers (ISPs) have claimed that they have no plans to block or degrade traffic once the Federal Communications Commission's 2017 net neutrality repeal Order goes into effect (exactly when that will be remains TBD), commitments (or lack thereof) not to engage in paid prioritization have remained a moving target. These commitments are shifting with the political winds, and ISPs are including plenty of wiggle room to allow them to argue they haven’t misled consumers if they eventually choose to offer prioritization deals.To be clear at the outset: A ban on paid prioritization is essential for meaningful net neutrality protections. Some of the most likely threats to the open internet come from paid prioritization -- ISPs speeding up some internet services at the expense of others. Because paid prioritization is a zero-sum game, speeding up some traffic means other traffic is, by comparison, slowed down. 

A dozen Democratic senators are asking the Federal Communications Commission to investigate Sinclair Broadcasting Group for distorting the news.  The FCC should also pause its review of Sinclair's acquisition of Tribune Media — a merger that could expand the nation's largest broadcaster from 193 stations to 223 stations covering 72% of US homes  — the senators say, to determine whether the deal is in the public interest. The senators are the latest to criticize a recent on-air promotional message read by many of Sinclair's local news anchors warning viewers about "false news" on competing media outlets. The scripted message, aired on dozens of stations in the past few weeks, said many media outlets are publishing "fake stories" and pushing agendas. “We have strong concerns that Sinclair has violated the public interest obligation inherent in holding broadcast licenses," said the senators. "Sinclair may have violated the FCC’s longstanding policy against broadcast licensees deliberately distorting news by staging, slanting, or falsifying information (traditionally known as the news distortion standard),” wrote the Senators Maria Cantwell (D-WA),Tom Udall (D-NM), Elizabeth Warren (D-MA), Ron Wyden (D-OR), Ed Markey (D-MA), Richard Blumenthal (D-CT), Tina Smith (D-MN), Bernie Sanders (I-VT), Jeff Merkley (D-OR), Tammy Baldwin (D-WI), and Cory Booker (D-NJ).

With the Justice Department's top antitrust attorney, Makan Delrahim, looking on from the government's table, AT&T's witness claimed that regulators' economic analysis of the Time Warner deal is "theoretically unsound" and riddled with inaccurate assumptions. "The evidence doesn't support the government's claim that this transaction will harm consumers," said Dennis Carlton, an economist from the University of Chicago's Booth School of Business. His own competing study, he said, found that consumers could end up facing lower prices, not higher. Carlton's testimony threatens to undercut that of the government's own star witness, Carl Shapiro, economist at the University of California, Berkeley. As Carlton criticized Shapiro's economic model as "very complicated," U.S. District Court Judge Richard Leon interrupted to agree with that description. "It's like a Rube Goldberg contraption," he said, reflecting skepticism about a core piece of the Justice Department's case.

President Trump abruptly issued an executive order demanding an evaluation of the Postal Service’s finances, asserting the power of his office weeks after accusing Amazon, the online retail giant, of not paying its fair share in postage. In the executive order, issued just before 9 p.m., President Trump created a task force to examine the service’s “unsustainable financial path” and directed the new panel to “conduct a thorough evaluation of the operations and finances of the USPS” The president does not mention Amazon in the order, but it is clear that he intends for the panel to substantiate his repeated claim that the financial arrangement between the Postal Service and Amazon, its biggest shipper of packages, is a money loser. Postal Service experts and even Trump’s own advisers have privately urged him to back off the accusations, noting that the huge number of packages shipped by Amazon is actually helping to keep the Postal Service financially solvent. While the service has consistently reported net losses for a decade, much of its financial woes are the result of a prolonged decline in the volume of marketing mail and first-class mail. The service makes money on packages, and Amazon is the service’s biggest single shipper of packages. Trump’s repeated attacks on Amazon have focused in part on the company’s billionaire owner, Jeff Bezos, who also owns The Washington Post.