Once again, Mark Zuckerberg found himself standing before the House Financial Services Committee on Wednesday. His journey to Washington DC has been necessitated by many questions the US Congress has in store for him, mainly on the activities of Facebook.
Although Zuckerberg was hoping to make a case for Libra, the hope was quashed by the wave of questions hitting him from many angles on antitrust and the ad services of Facebook.
Earlier in the month, US congress woman and Democratic presidential hopeful, Elizabeth Warren, has called out Facebook for publishing ads containing outright lies for President Trump. She said the influence of the social media giants in shaping electoral decisions cannot be ignored, and therefore, there is a need to keep its activities in check respecting upcoming elections in the US and what Facebook publishes in ads.
There is also a general concern about the power at the disposal of tech companies in the US, mainly, Facebook, Amazon, Google etc. and the calls to break them up is getting louder. In a campaign promise, Warren said.
“I want a government that makes sure everybody – even the biggest and most powerful companies in America – plays by the rules. And I want make sure that the next generation of great American tech companies can flourish. To do that, we need to stop this generation of big tech companies from throwing around their political power to shape the rules in their favor and throwing around their economic power to snuff out or buy every potential competitor.
“That’s why my administration will make big, structural changes to the tech sector to promote more competition – including breaking up Amazon, Facebook, and Google.”
Recently, the US government’s interest in the activities of the tech industry has upped, and Facebook has taken the center stage of the Government’s askance. The deteriorating relationship has resulted in Mark Zuckerberg’s frequent visits to Washington.
So on Wednesday, when Zuckerberg stood before House Committee once again, the arrows of quiz aimed at him were about issues like political ads, disinformation and child pornography. Therefore, there was no room for deliberation on Libra. The Democratic chairwoman of the committee, Maxine waters, puts this way:
“As I have examined Facebook’s various problems, I have come to the conclusion that it would be beneficial for all if Facebook concentrates on addressing its many existing deficiencies and failures before proceeding any further on the Libra project.” She said.
Although Zuckerberg argued that government’s failure to approve Libra would give China an advantage to lead the world of digital currency, the committee didn’t balk. In fact, they made it clear that their opposition to Libra has been because it opposes the US dollar.
“It should be clear why we have serious concerns about your plans to establish a global digital currency that would challenge the US dollar.” Waters said.
Since June when Facebook announced the idea of Libra, the US Government has not hidden its skepticism about it. The subsequent suspension of the idea has bordered on the fear it could usurp the dollar because it wouldn’t function under the control of regulators.
Facebook’s cryptocurrency head, David Marcus told The New York Times that regulators have been much more receptive to the idea in their private meetings than lawmakers. Facebook has been pushing to have its way through lobbyists and series of private meetings with regulators.
But the hope is dim and time is running out. Facebook appears to have so much dirt on their hands to clean up and the challenge of not getting broken up is becoming bigger. With the next election about one year from now, and Elizabeth Warren not relenting on her promise to tame the bullies in tech industry, there is a little chance that Libra will become a reality.