Hearing of the House Financial Services Committee - Opening Statement of Rep. Waters, Hearing on An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors

Hearing

Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, gave the following opening statement at a full Committee hearing with Mark Zuckerberg, Chairman and CEO of Facebook, entitled, "An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors."

As Prepared for Delivery

Today we are here to examine the impact of Facebook on the financial services and housing sectors.
Our sole witness is Facebook's Chairman and CEO Mark Zuckerberg.

Facebook's plans to create a digital currency, Libra, and a digital wallet, Calibra, raise many concerns relating to privacy, trading risks, 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 Facebook's development of its digital currency, Libra, and digital wallet, Calibra until Congress can examine the issues associated with a big tech company developing these digital products, and take action.

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.

Let's review your record:

On diversity and inclusion, Facebook has utterly failed. Facebook's 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 including Facebook to release diversity statistics more than five years ago, the representation of African Americans and Hispanics has increased by less than two percent. Facebook also told us that they have zero dollars managed by diverse firms.

On fair 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 (HUD) has also filed an official charge of discrimination against Facebook for its advertising practices, including the company's own ad delivery algorithms, which were found to have a discriminatory impact even when advertisers did not target their audience in discriminatory ways. I understand that Facebook has refused to cooperate with HUD'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 webpage to operate with the goal of discouraging African Americans 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.

On political speech, last week, you announced that Facebook would not be doing fact-checking on political ads, giving 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 suppression effort that will move at the speed of a click. Your claim to promote freedom of speech does not ring true.

Mr. Zuckerberg, each month, 2.7 billion people use your products. That's over a third of the world's population. That's huge. That's so big that it's clear to me and to anyone who hears this list, that you believe that you are above the law, and it appears that 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, your own users, and even our democracy-- to get what you want. With all of these problems I have outlined, and given the company's size and reach, it should be clear why we have serious concerns about your plans to establish a global digital currency that would challenge the U.S. dollar.

In fact, you have opened up a serious discussion about whether Facebook should be broken up.

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