Daily Traders Edge

With Facebook, Congress Can’t Regulate What It Doesn’t Understand

April 13
11:28 2018

Clean up your act, he threatened –  or “we’ll do it for you. And you don’t want that.”

That could easily be a member of Congress at this week’s Facebook hearings – but it was former Rep. Henry Waxman, chastising the MLB in a 2005 congressional committee on the steroid use controversy.

In fact, the exact same sentiment was reflected by Senator Bill Nelson of Florida, a Democrat, during the Senate testimony of Facebook CEO’s Mark Zuckerberg. “If Facebook and other online companies will not or cannot fix the privacy invasions,” he said, “then we are going to have to.  We, the Congress.”

“What do we tell our constituents, given what’s happening here, why we should let you self-regulate?” pressed South Carolina Senator Lindsay Graham, a Republican.  “What would you tell people in South Carolina that, given all the things we just discovered here, it’s a good idea for us to rely upon you to regulate your own business practices?”

Unfortunately for Senators Nelson and Graham, even though they seem to wish for us to default to Congress to regulate Facebook, the body – and the administrative state – is oh-so-incapable of regulating Facebook.  And so, more than anything, this congressional hearing process was all hat and no cattle.

Indeed, it seems that we are again facing an instance of political grandstanding in 2018, in many ways like 2005.  We once again witnessed not “meaningful debate” over “substantive policy.”  We observed a political dog and pony show in action.

Let’s look at history.  What was the outcome from the steroid abuse hearings?  Perhaps the firestorm surrounding Congress’s hearings on baseball doping helped instigate changes – but so did the public outcry, and even more – Congress didn’t do anything.  And they shouldn’t have, anyway: it’s not Congress’s place to micromanage baseball teams – just as it is not Congress’s place to micromanage Facebook.

Continue Reading At Real Clear Markets

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