“Laws are like cobwebs, which may catch small flies but let wasps and hornets break through.”
That quotation by author Jonathan Swift captures something unavoidable – While the $17.6 billion settlement Meta (Facebook) agreed to last week with 47 states and several U.S. territories might seem like a huge admission that the company’s addictive social media algorithms have been harming children, a close look at the details shows a lot left on the table.
The settlement funds will be spread over ten years and are partially contingent on Facebook/Instagram’s competitors agreeing to make the same changes. All told, Meta will shell out more this year to its own lawyers than to states.
“This is a massively good deal for Meta in terms of what they’re actually going to have to pay, and the fact that they didn’t admit to anything,” says investigative journalist Peter Schweizer. “Why would these state attorney generals, who are supposed to be these fire-breathing protectors of their citizens, go along with such a terrible deal?” Schweizer asks on the most recent episode of The Drill Down.
“The biggest example that people are using to compare this is to the tobacco companies’ settlement thirty years ago,” notes co-host Eric Eggers. “But the tobacco settlement was actually for $200 billion in 1998, while Meta is getting off cheap, even if its competitors adopt the same safety changes to how they work for children.”
“Here’s how you know it’s bad. The reason the number fluctuates is the amount of money Meta will have to pay goes up if their competitors — YouTube, TikTok, Snapchat, et cetera – also agree to put in the same changes,” Eggers says. “So, Meta’s willing to pay up to five billion dollars more if their competitors’ products become less attractive to kids. That’s literally the settlement.”
Meta’s path is not cleared, however. Florida still has a separate lawsuit against the digital giant that is at trial now, and many observers say that case is not going well for Meta. “That’s peanuts,” said Florida’s Attorney General James Uthneier after last week’s settlement was announced. “That’s not sending a message.” Uthmeier told CNBC, “We’ll go to court, we like to fight for our kids in Florida. We’re not going to bend over and capitulate.”
“They should be held accountable for the products that they produce,” agrees Schweizer. “And they’re producing a product that is highly addictive.”
Among the concessions, Meta agreed to add opt-out switches for Facebook and Instagram for the feeds shown to teenagers.
“I’m wondering about with this opt-in, opt-out feature,” says Schweizer. “How easy is it going to be for kids to go online and circumvent this feature that Meta will put in place? Meta has no incentive, from a business standpoint, to reduce the level of addiction. They want the level of addiction to increase because they make money based on the amount of time that you spend on their product.”
So, why would all of these other states, led by both Republicans and Democrats, agree to the deal? Perhaps journalist HL Mencken’s earthy quote about lawyers helps answer: “Lawyers’ relationship to justice is the same as a whore’s relationship to love.”
The hosts note recent news that Meta will spend about $65 million in political contributions to advance the company’s interests in artificial intelligence (AI).
“All these companies, their algorithm is based on AI. The addiction algorithms that they use to keep kids glued to the screen are created, curated, and maintained by AI,” Schweizer explains. “So, this is directly related to this addiction industry.”
Eggers adds that a news story from last month found that the major AI companies producing these algorithms are funding the attorney generals investigating them. “Isn’t that convenient?” Schweizer says ruefully.
“There are these things called the Republican Attorney General Association (RAGA) and the Democrat Attorney General Association (DAGA), and they help fund these races,” Eggers says. “The top AI companies — OpenAI, Google, Meta, and Amazon — have all donated more than $2 million to these attorney general’s campaigns since the start of last year.”
“This is not a done issue, but I tell you that if what we just saw, this capitulation by the state AGs to Meta is any indication, none of these tech companies will have anything to worry about,” Schweizer says. “It’s going to be like paying a small tax to keep doing business.”
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