“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,” Waters said.
The opening salvo illustrated the intense pressure Facebook is facing as it tries to launch the new payments network, which it says would make it easier for consumers to move money. At the heart of the pushback are concerns about Facebook’s huge user base and how it has managed its social network.
Among the issues Waters highlighted: failure to improve diversity in Facebook’s leadership ranks; enabling housing discrimination through its ad platform; infringing on users’ privacy; and facilitating foreign election interference.
Waters also hammered Zuckerberg over the company’s policy to exempt political ads from fact-checking, saying it could allow candidates to wage unchecked campaigns to discourage voting.
She said the impact of the policy — which has come under heavy scrutiny in Washington since its unveiling in August — “will be a massive voter suppression effort that will move at the speed of a click.”
The Democratic lawmaker cited the policy in swiping at Zuckerberg’s recent high-profile speech in which he sought to reaffirm Facebook’s commitment to freedom of expression.
“Your claim to promote freedom of speech does not ring true,” Waters told Zuckerberg, the sole witness testifying.
Zuckerberg — appearing on Capitol Hill for the first time since last April — stood by the company’s stance, arguing that Facebook only derives a small share of its profits from political ads and that the decision to keep up misleading political ads is a matter of principle.
“This really is not about money,” he said. “On principle, I believe in giving people a voice. I believe that ads can be an important part of voice.”
Facebook has been besieged by controversy over its decision to host a misleading political attack at by the Trump campaign targeting Joe Biden. The former vice president and Sen. Elizabeth Warren (D-Mass.), among other 2020 presidential contenders, have blasted the company over the move.
But the main focus of the hearing was Facebook’s Libra project, which the company is trying to launch with other partners under the auspices of the Switzerland-based Libra Association. The effort suffered a big blow earlier this month when major financial institutions and tech companies including Visa, MasterCard and eBay walked back initial commitments to join the association.
Zuckerberg told lawmakers today that he believed the early partners distanced themselves from Libra “because it’s a risky project and there’s been a lot of scrutiny.”
“I actually don’t know if Libra’s gonna work,” he said.
Zuckerberg said he would be willing to walk away from the Libra coalition if U.S. regulators don’t sign off on the project.
The tech billionaire was pressed by Rep. Bill Huizenga (R-Mich.) on what would happen if the rest of Facebook’s partners at the Libra Association wanted to start issuing Libra without U.S. regulator approval.
“Then I believe we would be forced to leave the association,” Zuckerberg said.
Zuckerberg’s comments underscored a narrative that Facebook has started emphasizing in recent days: Despite inventing Libra, it can no longer be the primary face of the project because it’s now under the control of the association.
“I would hope that the association will weigh our recommendation and what we say publicly that we think should happen,” he said in his exchange with Huizenga. “But if at the end of the day we don’t receive the clearances that we feel like we need to move forward, and the association chooses to move forward without us, then we will be in a position where we will not be part of the association.”