At the World Economic Forum annual meeting in Davos, Switzerland, George Soros spoke on January 24th, discussing “informal mutual assistance, operation, or agreement developing between Trump and Facebook,” implying that President Trump and the social network were protecting each other due to mutual vested interests. This isn’t the first time Soros has spoken out against Facebook. At Davos in 2018, Soros spoke out against Facebook and Google to support regulations against both companies due to their large market shares. Citing a lack of evidence, Facebook immediately denied the claim, but that didn’t stop Soros from publishing an opinion piece on the New York Times titled, “Mark Zuckerberg Should Not Be in Control of Facebook,” which expanded on his argument of an arrangement between Facebook and the president. The article referenced advertising assistance Facebook provided to Trump’s 2016 presidential campaign, Zuckerberg’s meetings at the White House, its content and ad moderation policies, and recent hirings as evidence of an arrangement.
As it tends to do, the Internet erupted in chaos, with a variety of conspiracy theories emerging that accused the social network and its leaders of deliberately tampering with the election by manipulating posted content to influence the outcome of the presidential race. At the same time, a renewed attack was mounted against Soros, rekindling smear campaigns and accusing him of leveraging his financial position to advance his own personal political agenda.
No Stranger To Criticism
A brilliant financier, Soros amassed large amounts of wealth through his hedge fund, before eventually turning over the majority of his attention to philanthropic and political causes. As a student of Karl Popper while studying at the London School of Economics, Soros subscribed to the “open society” philosophy that has been a guiding principle for his financial contributions, even naming his foundation after it. As a result of his large financial contributions and outspoken political positions, he became the target of numerous conspiracy theories alleging his involvement in various plots against conservative causes.
Zuckerberg, Sheryl Sandberg, and Facebook appear to be one of his current targets. Many of Soros’ investments have them in their sights: the Open Markets Institute advocates a government breakup of the company, MoveOn prods the company to ban fake news, SumOfUs accuses Facebook of censorship, Citizens Against Monopoly alleges the company allowed Russian interference in US elections.
Theory #1: Financial Gain
In 2018, just a few months after telling the world that Facebook (and Google) was a “menace” whose “days are numbered” at Davos, his family fund Soros Fund Management acquired 159,200 shares of FB after the stock got pounded down in Q2 of 2018.
Investors enjoyed a nice ride during the rise in Facebook stock, and the fund sold its positions before it took a nosedive in late 2018. However, the total position was $30 million, a lot of money for an individual, but a tiny fraction of the size of the multi-billion dollar fund, and operations of the fund were not managed by George Soros at that time. Investors profit from opportunistic information asymmetry – some insight that they have regarding an investment enables them to make market predictions and leverage that to their financial advantage. Soros’ comments at Davos in 2018 were public and did not involve insider information, so conspiracy theories about the comments being financially motivated to drive down the stock are not likely. The risks were too great, and the upside was too small.
Theory #2: Personal Vendetta
Soros is often characterized by opponents as a Machiavellian puppet master, a shadowy billionaire pulling the strings of world governments all around the world to advance a personal dystopian globalist agenda. So another popular theory is that he felt threatened by Zuckerberg because he couldn’t manipulate him, so he began financing a campaign to take him down and replace him with someone that he could control. One problem with that theory is that Soros and his family have too much to lose in US assets to risk a secret conspiracy against the American government. Sure, there are allegations of shadowy offshore tax schemes intended to shortchange the IRS, but these complex structures are common among high net worth individuals, which have teams of attorneys dedicated to establishing legal structures to minimize taxes while still remaining in compliance with the law.
The other problem with this theory is that Soros is outspoken about the dangers of China’s autocratic use of technology, and destabilizing Facebook could open the door for a Chinese state-owned enterprise to step in and take its place. Soros is well aware that he would have almost zero influence over a Chinese or Russian controlled social network, so complete destruction of Facebook is not in his best interests. The other obvious point to make is that if Soros has a problem with Zuckerberg or Sandberg personally, it would not be all the difficult to give them a phone call and engage them directly. But perhaps a civil discourse was not viable, since Facebook admitted to hiring a public relations firm to undermine Soros’ credibility after his attack in 2018, a move that Zuckerberg and Sandberg quickly disavowed after it was revealed in the media.
Soros went public with his gripes at Davos in 2020, and then called on Zuckerberg and Sandberg to be removed from control in an op-ed piece in the New York Times, a common passive-aggressive political maneuver: if you can’t get your way directly, go to the press with your beef and shame your target into action.
Theory #3: Idealistic Philosophy
The most likely theory is that Soros is driven by principle. A self-described follower of the Karl Popper open society philosophy, he has been an enthusiastic financial backer of activist organizations that advocate individual liberties. After observing the effects of state-owned media in the Eastern Bloc and Communist China, Soros financed liberal causes in his home country of Hungary, only to end up having his staff eventually pushed out of the country by the local government. He was outspoken against the Bush administration and particularly critical of Karl Rove, calling for an effort against manipulation of American politics through deceptive media. He was opposed to Trump’s 2016 presidential campaign, backing Hillary Clinton, and in 2020 he is opposed to his re-election, after labeling Trump as “an imposter and a con man and a would-be dictator.”
If Soros is a billionaire globalist puppet master pulling the strings from behind the shadows of an international Jewish secret society, he’s not a very good one. He opposed George W. Bush and lost, financed Clinton’s run against Trump and lost, and his advocacy groups have been driven out of Russia and Hungary. Instead, it appears his efforts are based on a dim view of authoritarian regimes, with a narrative that regards the practices of Bush, Trump, and Zuckerberg as precursors to fascism, by suggesting that they engage in predatory behavior intended to manipulate the American people.
Agent of Propaganda
Soros’ argument is that Facebook, and therefore Zuckerberg and Sandberg as its leaders, are complicit agents of propaganda by allowing bad actors to influence American voters with inaccurate information and inflammatory content, along with the argument that due to its size and market share (along with Google), it has an obligation to combat misinformation. Much of that view was due to the influence of Roger McNamee, a Facebook investor that was concerned about certain user patterns that he observed on the platform. McNamee later revealed that he had reached out to Zuckerberg and Sandberg with his concerns, which were met cordially with assurances that Facebook was working to address the issues. Over time, McNamee felt that the company was brushing off his concerns, and when he didn’t get his way, he went to the press, publishing essays and writing opinion pieces to shame them into action. Soros read McNamee’s material and it resonated with his philosophy, culminating in a long meeting at Soros’ house to prepare a presentation at Davos in 2018.
With Soros and former Google employee Tristan Harris in tow, McNamee met with various politicians in Washington to advocate government intervention, providing them with the narrative of Russian agents spreading misinformation on Facebook to influence American voters. With the Mueller investigation of Trump ongoing, Democrats were more than eager to get their hands on anything that could lead to implicating the president of election interference. McNamee went on to publish Zucked, a book recounting his experience, which rose onto the New York Times bestseller list thanks to the agitated political climate.
As expected, reactions were intense. Silicon Valley, a hotbed of innovation, is also a culture of technocratic libertarianism, where anyone with enough skills, strategy, and determination could build the next billion dollar business. The industry preferred to deal with its own instead of bring in outside regulation, and if Facebook had slipped up, another startup would just take its place. To many, an investor turning against a company that they helped build was appalling, and turning to the government to ask for regulation was even worse, stifling innovation by inviting outsiders into the process. Terms like “surveillance capitalism” emerged, accusing companies like Google and Facebook of selling personal data about unwitting users to advertising companies looking to target those users with their offerings.
Seen This Story Before
Twenty years ago, Microsoft was in the crosshairs of the US government for alleged anti-competitive practices, accused of using its leverage in the operating system market to disable competition for Internet web browsers such as Netscape. Then-CEO Bill Gates was summoned before Congress to testify, resulting in a federal judge ordering a breakup of the company. The breakup was overturned on appeal with a settlement agreement, with Microsoft agreeing to a series of “behavioral remedies” to address public concerns, which arguably opened the door to allow Google Chrome to overtake Microsoft’s Internet Explorer in market share.
Today, as technology expanded beyond the personal computer into the Internet and mobile devices, technology is not ruled by a single company but dominated by a handful of powerful giants that exert control over their spheres of influence. These businesses often face anti-competitive accusations, such as Apple with regards to its mobile devices, or Amazon with its dominance in the e-commerce sector. Facebook’s situation, however, is not anti-competitive. Accused by Soros of “helping Trump get elected,” it is being asked to politically moderate the content posted by its more than 2.3 billion users.
Zuckerberg’s response to this pressure to moderate Facebook’s users was that the company was simply a neutral platform that connected its users. It did enter into an agreement with fact-checking company Snopes in 2016 in an attempt to prevent outright misinformation from being spread on the platform, but that contract was canceled in 2019. Soros’ stance has been that Facebook is a publisher and not a platform, and so it is accountable for anything posted on its site by any one of its more than 2 billion users.
Facebook is not alone. Other large social media sites with user generated content such as YouTube and Twitter are bombarded daily with a deluge of new content from its users. A small portion of that content is offensive, false, or inflammatory in nature. The nature of Internet use provides a degree of separation between people, which can embolden certain users to express themselves behind a shield of anonymity or physical distance. This “internet courage” has led to many users posting statements online that would normally get them punched in the face if spoken directly to their subject in person.
Social media companies like Facebook have made efforts to moderate inflammatory and false remarks, but their actions are often interpreted as a form of censorship, especially when the nature of the content is aligned with a particular political view. This has led to conspiracy theories of a particular platform suppressing political positions that they oppose through censorship. While it is possible that individual employees at social media companies may express a particular political bias that affects their ability to moderate, specific instructions to censor the content of a particular political view would not stay private for very long and trigger a very public scandal.
Large corporations are deathly afraid of two factors that they cannot directly control: liability and regulation. If an individual was somehow seriously harmed through use of a company’s product, and if that harm had even a tiny hint of negligence from the business, the legal, financial, and PR exposure could be devastating. That exposure could lead to a government inquiry, which could lead to a heavy-handed policy that could maim the business’ ability to maintain its dominant position.
With a rise in violent extremism across the world and in the United States, and with some of those extremists taking to social media to spread their ideology and recruit new members, there is a growing concern about using a platform that is intended to connect people for constructive purposes being used to unite violent factions that seek to harm others. The challenge is how to distinguish free speech from hate speech, and to prevent violence from become organized without denying citizens their right to express themselves peacefully. Holding a single company or even a handful of companies responsible to make that distinction will not be effective or comprehensive and risks the suppression of First Amendment rights.
Soros’ philosophy is well-intended. Misinformation that is propagated as truth is a danger to society and politics that can ultimately lead down the path of intolerance and violent extremism. His proposal, however, is not realistic.
- Mark Zuckerberg personally holds a controlling stake in Facebook. Forcibly removing the leaders of Facebook without criminal charges sets the dangerous precedent of government seizure of civilian private property.
- Removing Facebook’s leadership will only result in their replacement by someone else that will be facing the same challenges, or worse, result in Facebook’s decline.
- Mandating that Facebook, Twitter, YouTube, and the like moderate user content for billions of users for factual accuracy is very, very labor intensive. Reviewing content for a handful of “influencer” accounts with millions of users is more realistic, yet still must not be a form of censorship.
- Journalists and influencers must also share in the accountability in addition to social media companies. Large social accounts that reach millions of users should be subject to additional scrutiny, ethical standards, and legal exposure such as libel and defamation. Soros’ statement that “Facebook can post deliberately misleading or false statements by candidates for public office and others, and take no responsibility for them” is misguided because Facebook does not post these statements. The statements are posted by large social accounts with millions of followers, not Facebook. Those individuals should be held to account.
- Government censorship laws will only increase the problem and spawn a new batch of conspiracy theories and lawsuits that do not attack the core issue of accountability.
- Violent extremism is a real threat to peaceful co-existence and tolerance. Social media regulation would hardly scratch the surface of the issues.
To address Mr. McNamee’s points:
- The “troll farms” should be held to account, with a message to users touched by those accounts from the platform. Inflicting unnecessary injury on a business that was also the victim of these accounts without evidence that they explicitly endorsed those accounts only implies a personal vendetta.
- A general summons before Congress without a specific purpose only results in virtuous grandstanding. Define a specific purpose, such as how to factually verify the content coming from influencer accounts with a large social following without denying First Amendment rights. Asking Facebook to prevent violent extremism is an exercise in failure.
- Banning digital bots. Be careful, much of the sports news content that is published online is written by bots. Blaming tools doesn’t fix the underlying issue.
- Acquisition blocking. Government interference into civilian matters is a slippery slope. Facebook is a publicly listed company, its acquisitions are already reviewed by the SEC. If you are implying that acquisitions be blocked to investigate a criminal matter, then some evidence of criminal misconduct would need to be present to do that.
- Transparency is a good thing both in advertising and in publishing. Large social accounts should be subject to the same rules as advertisers and be required to disclose their identity and financing. Forcing that on individuals with small followings is an invasion of civil liberties.
- Auditing algorithms sounds like a noble purpose, but is not practical. Besides finding thousands of lines of code, auditors will find trillions of data points fed into thousands of machine learning algorithms that produce data matrices that result in optimization signals used to rank content. The algorithms use user feedback to optimize interest, such as click history or related activities. What’s the point of auditing that? It doesn’t prevent bad actors from entering the system and gaming the current version of the algorithm. If the algorithms are made more transparent, that gives bad actors even more tools to game the system. Identify the bad actors and hold them accountable. Worried about Russian interference? Cannot every troll post and every fake page made on Facebook be traced back to its human origin?
- EULA equity. These are voluntary services, not public utilities. If you don’t want to use Facebook, suspend your account. You don’t have a legal right to access Facebook. Access to affordable electric power and clean water are public utilities. Enforce or fix data privacy laws if those are not sufficient.
- Enforce or fix data privacy laws. Commercial exploitation of users is a common narrative to vilify large businesses as evil conglomerates but ends up sounding like political grandstanding instead of proposing solutions.
- Allowing users to own their own data is acceptable, but it also means that they need to own their own liability. If a user publishes something that is inaccurate, slanderous, inflammatory, or violent, then that user should be legally liable as a journalist, without the legal protection of a corporate publisher. This means ignorance is not an excuse for large social accounts.
- Monopolies are problems when they engage in unfair anti-competitive practices. You can use Twitter, LinkedIn, TikTok, or Snapchat instead of Facebook. You can use Bing instead of Google. Antitrust law prevents Facebook or Google from threatening these other services with unfair practices. Limiting their power has nothing to do with antitrust law, it has to do with regulation of business practices. Just because LinkedIn is smaller than Facebook doesn’t mean that it has permission to sell its user data to the highest bidder.
McNamee’s points aren’t malicious, nor are they impossible. But there is a more efficient policy path to achieve the same overall goal to protect the sacred democratic process. There are laws and standards that govern the integrity and activities of political journalists. Accounts with large social followings that decide to publish political statements should be held legally responsible for their content, and ignorance is not an excuse. In this case, Facebook is your ally, because in a criminal subpoena they can trace the origin of toxic activity down to the offending individual. If a journalist on NBC News says something factually incorrect or inflammatory which is then broadcast on Hulu, is Hulu responsible for that statement? Was Hulu “manipulated” by NBC and should be legally required moderate all video content being broadcast from all of its channels?
An individual using Facebook to connect with their friends and conduct political discourse is part of their First Amendment rights. When a user has millions of followers and decides to voice their opinions on social media, they become a publisher and should be subject to a higher standard of legal accountability and transparency. When those publishers learn that they will be held publicly liable for their actions, they will think twice before trolling the Internet.