More GOP Twitter suspensions, Parler is back, and FTC Commissioner Rebecca Slaughter on the future of big tech

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Hi, everyone.

This is Pivot from New York Magazine and the Vox Media Podcast Network.

I'm Kara Swisher, and I'm Sky Calloway.

And Kara, you sound like you're in an awful mood.

What can I do to help?

I just had, I just took my son to college.

I'm a little tired.

I had a lot of meetings, a lot of meetings today.

I'm in New York City.

I drove up

in a sealed vehicle, and then I've been just getting my son a bunch of stuff.

He needs all kinds of things like marshmallows and hot chocolate because he's got to be in quarantine for several days.

Hmm.

That's right.

He's back in school.

Yeah, he is.

They're going to do hybrid classes, which is really exciting.

So we'll see.

Now that all you NYU professors have gotten all your shots, you better get back to school.

That's all I got to say.

It's back to school.

Back to school.

So anyway, so and I got to drive down to Washington.

I'm a little tired, I'll be honest with you.

And I'm also interviewing Ralph Macchio from The Karate Kid tomorrow.

So I had to watch all the Cobra Kais, which I did.

Ralph Macchio.

Wow.

I mean, you know, Zuckerberg, Cook, that's one thing.

But when you get to Macchio, you know what?

It's the biggest hit on Netflix, my friend.

This is really interesting.

A lot of these revival shows, and this one is wonderful, actually.

It's a shockingly good,

I don't know what it is.

It's a revival.

It's 20 years later, 30 years later.

It's really good.

It's 80s music.

Everybody loves 80s music.

Everyone loves 80s.

Everything.

It's not just that, because it could be hokey and terrible.

It's really well done.

It's incredibly well done.

Anyway, a little hokey.

So I got to get back to DC, which is which we like to call Fortress D.C.

And hopefully they'll let me into the city.

If as long as I'm not carrying, you know, ammunition and munitions, which apparently all these people drive there and can't believe they get caught

with a trunk full of guns and bullets.

It's crazy.

That's shocking to me because as a group, they seem strikingly practical and intelligent to me.

No, they're not.

It's crazy.

Like, really, they drive up to like checkpoints with

a trunk full of weaponry in the middle of this, like millions of troops.

And, you know, Stephanie Ruhl is down there right now in D.C.

I'm going to be seeing her tomorrow, possibly.

And she's doing a story about the vendors that got hit, the restaurants.

This would have been a big money-making weekend for everyone, even in the middle of the pandemic, because of Trump and because of the backlash he has created and all this difficulty

and the backlash to the backlash, essentially,

they're going to have this problem that nobody gets to go to the inaugural.

My kids don't get to go.

It's just really sad what's happened here.

Yeah, I agreed.

It's really sad.

But back to Netflix.

Have you seen Bridgerton?

No, not yet.

I'm not ready for porn yet.

So I will.

Oh, it's tall porn.

But it's really well-produced porn.

I said, I was watching it last night.

I'm like, this is like Cinemax on a higher, a better, you know, bigger production budget.

Yeah, and the guy is handsome.

I thought you'd have a man crush on him.

The duke

yeah he's holy oh yeah he's a tall drink of lemonade is he yeah that's what i heard that's what i heard i knew you'd like him speaking of uh of tall drink of lemonade which has nothing i'm trying to make a shift but you know one of the things we've talked about is how well uh people that are that are getting fit and he is very fit obviously um but peloton's facing a backlash from users uh for delayed delivery and poor customer service um it's quadrupled in value to almost 40 billion during the pandemic it's a great product i love my peloton but they're having trouble delivering the goods, delivering the bikes themselves.

Well, think about that.

This is just supply chain, Peloton, and this is another reason why I think once Peloton stock comes down, there's a decent chance it'll be acquired by a big tech firm, most likely Apple.

We've talked about that.

But if you think of...

If you think about the sweat industrial complex, it's a big, big business, and it's all been dispersed to people's homes and living rooms and the mirror and all this stuff.

And Peloton took advantage of that.

But the supply chain, people don't, you know, it is hard to assemble a connected device.

It's relying on components coming from all manner of the four corners of the earth.

So it's not a, I don't think it's a surprise they've run into supply chain problems.

People, one thing people have never really,

people know that Apple's a great retailer.

They understand that they're a fantastic marketer.

Their CEO is a supply chain guy.

Their ability to bring $550 of chipsets and sensors together from different regions of China and Taiwan and the U.S.

and sell it for $1,100,

You know, the logistics here are just extraordinary.

So

I think it's more surprising it took so long for this supply chain hiccup.

But anyways.

Yeah, it's interesting.

But people love the product.

That's the thing.

This has happened to a lot of great products.

I remember when the iPhone came out and not everybody had to wait and wait and wait to get it?

Yeah.

I think ultimately this will be fine for them.

But they really do have to lean heavily into getting the supply chain perfect in some ways.

Yeah, it's you know, that stuff, I mean, think about, but if you think about really the, okay, the most valuable company in the world, Apple, the company that's added, I think, the most market cap, well, actually it's Apple, but one of the big four, Amazon, what are they?

They're victories in supply chain.

Everybody talks about blitz scaling and technology, but

if you think about Walmart adding hundreds of billions of value through click and collect, if you think about Apple's ability to put this incredible phone at high margin and put it in stores around the world, including the 550-year-old temples, if you think about Amazon, the thing that's taken them from kind of 50 billion to one and a half trillion was Prime.

It's supply chain.

You know, we all talk in the 90s.

Well, but in the 90s, for a hot minute, it was brand that was the gangster competence.

And people like that, and it's controlled the narrative, and Starbucks, and Nike.

But I'll tell you, if you really want, if you're a young person and you're coming out of school and you want to think about how do I develop a skill set

that foots well to where the market is headed, it is about operations and supply chain, and that's where the real innovation is.

Companies are reallocating capital out of marketing and advertising

into distribution supported by robust, really robust biodiversity.

It's so sexy supply chain.

It's anything but sexy.

It's the opposite of that.

It's as sexy as the Duke in Bridgerton.

Is supply chain as sexy as the Duke in Bridgerton?

Yeah, no, you're right.

It's Shonda Rhimes.

Is that that her name?

Shonda Rhimes.

Shonda Land, yeah.

Shonda Lynch.

Yeah, she got a quarter of a billion dollars to do porn.

That's good for her.

You know, you didn't watch the other shows.

They were very.

What were the other shows?

They were down that road.

She's just gotten the Netflix permission to go even further down the road.

Gray's Anatomy.

Hello.

All of them.

She's like.

Oh, she was Grace Anatomy.

I never saw Grace Anatomy.

Oh, my goodness.

She's like the biggest hit maker in Hollywood, really, truly.

Yeah.

You know, after Dick Wolf, I guess he was also a big hit maker, but

he's, and that's the Law and Order series, but she is like the top level of creator in in in hollywood and netflix getting her and this being a big hit is a big deal good for her because they paid they paid up for her anyway we're gonna get oh by the way google just for people to know has completed its acquisition of fitbit so it's gonna be a really interesting space healthcare is gonna be an interesting space going forward and i think you're right i think peloton's going to get bought by one of them um and apple is the best choice because it looks like an apple device right it feels like an app and apple is actually competing with peloton with some of the the fitness stuff um but they're definitely in there We'll see what happens.

But we're going to move on to big stories.

Obviously, it continues to be the situation with tech companies and politics.

Twitter has suspended Representative Marjorie Taylor Greene's account temporarily.

The company said the well-known QAnon adherent violated the civic integrity policy after posting false information about Trump's election defeat.

She's deep into QAnon, along with several other new members of Congress.

This company policy has also been used to remove thousands of these QAnon-related accounts, which Marjorie Taylor Green has endorsed.

Last week at the Trump impeachment hearing, the congressman wore a face mask that said censored across the front.

I think she's an appalling person and should be expelled from Congress, but she was voted in here, and she continues to spew

rhetoric that's really demented, actually.

Meanwhile, Parlor, the social media app that hosted Umbral Far-Right Message Boards, is back online.

The website has a message from CEO John Mates, who I interviewed recently, that says, now seems like the right time to remind you all, both lovers and haters, why we started the platform.

We believe privacy is paramount and free speech essential, especially on social media.

It goes on to say, we'll resolve any challenge before us and plan to welcome all of you back soon.

We will not let civil discourse perish.

It's a little bit of a high-handed, high-horse thing from John Mates, who really, you know, he did a really terrible job in his interview with me.

And so what do you think, Scott Galloway, of all this?

Well, the most dangerous thing about last week wasn't this mob.

And I'm parroting Frida Zakaria, my kind of intellectual role model back.

It's not the most dangerous thing about last week wasn't the mob.

It was the recognition or the realization that a large portion of America believes, is convinced that there was election interference.

We have begun full Russia where the truth is no longer a thing.

And it goes back to that saying that if you can get people to believe absurdities, you can get them to commit atrocities.

And

if you think about, and I love this quote and I said it last week, that fascism is essentially the temporary alliance between the elite and the mob.

And the mob is going to pay a price here.

They are going to be put in jail, I believe.

But we now have to turn to the elite.

And that's the Fox Newses.

That's the representatives who the, I don't even call them Senator Holly and Cruz.

I call them Sedition Holly and Sedition Cruz, who knowingly spread misinformation.

And also

where the profane has become the obscene here is after canceling, suspending one account, after Jack Dorsey going through all this hand-wringing and suspending one account 1,449 days into his 1,460-day

tenure, we have found.

that just canceling, suspending that one account has reduced misinformation about this election by 72%.

So this bullshit lie that has been propagated by the lipstick on on cancer, that is Sheryl Sandberg, that is Jack Dorsey, that it would be impossible for us to police these platforms.

We always said, well,

it would be expensive, but it would be possible.

Well, guess what?

I was wrong.

It's not even expensive.

Yep.

That's interesting.

One account being shut down and 72%.

72% of the misinformation that resulted in infective insurrection and violence has gone away.

There wasn't wants to count.

They also cracked down on a lot of QAnon accounts.

This is the same thing.

You're right.

This woman allowed to spew this really nonsense and lies is really something.

And they act like that it's the height of

civil discourse at Parlor is ridiculous.

It's just not civil discourse.

It's something else.

And two things that I saw this week, there was a great piece in Politico about how Trump thought she and others were crazy, including Sidney Powell, and then sort of fell into

the belief system of these conspiracy theories, how easy it is to be radicalized.

And the second one that I think we do leave out, which Ben Smith wrote a fantastic

column about the lawsuit that Fox settled.

Fox settled, had the guy who was killed

just by a mugger, the Rich family, Seth Rich, and that Fox turned it into this ridiculous.

evidence-free conspiracy theory and then had to do this massive payout that they didn't want to announce until after the election.

And there's a quote that I think was 100% right that Ben had.

There's only one multi-billion dollar media corporation that deliberately and aggressively propagated these untruths.

That's Fox Corporation.

And I think there is not enough focus also on cable,

you know, in terms of cable and what it did, and especially Fox News.

And he also wrote, remember, that's the genius of the Murdoch's management of the place.

They collect the cash while evading responsibility and letting their hosts work primarily for Mr.

Trump.

This was Sean Hannity who was doing this.

It just, we cannot leave the echo chamber between these crazy people and Fox News and

how that fuels the entire sort of conspiracy theory, hatred, hate-mongering kind of stuff.

I got shit five years ago for saying the big tech was dangerous.

No, you're just jealous of our innovators.

Then I got a lot of shit for saying that Cheryl Sandberg was bad for women and our country and that Mark Zuckerberg was a sociopath two years ago.

No, you're jealous and and overreacting and and i and then i got a lot of on twitter for comparing hitler to trump uh or for comparing trump to hitler and everyone likes to think we've all gotten this cold comfort that oh he's been voted out of office it's over no it's not we put hitler in prison in the 30s and guess what he came back when you have an individual that has been that is basically we didn't germans put hitler excuse me germans uh a modern society that was known as an incredibly productive society that appreciated art, that appreciated

education, and everybody keeps saying it can't happen here.

Well, guess what?

It is happening here.

When you can effectively decide that you have no fidelity to the truth,

you end up with tyranny.

And what has been so shocking and so upsetting and has put us in such an uncomfortable place is that the stupid, the people who really

who have been co-opted by this, who believe that despite the 62 cases accusing

different

electoral districts of some sort of fraud or some sort of impropriety have been not only rejected, but they wouldn't even be heard because they were so ridiculous.

There are still something like 60 percent of Republicans think there was election interference.

Yeah, that's because they kept repeating it, the conspiracy theories, and they were more outlandish.

You know, the the problem is the elite thinks, oh, that's crazy.

Venezuela, Hugo Chavez, haha, like in this massive, there's one that Sydney fouled, this massive conspiracy between India and all these

people.

The Pelosi family.

Whatever, whatever.

It's like, but they do stick.

And one of the things that you have to go watch, there's a New Yorker video of a reporter that was on the scene there.

I saw that.

That is so disturbing what these people think they were doing.

And, you know, everyone's like, oh, how stupid they are.

I'm like, they believe what they're saying there about, you know, that there's a conspiracy.

What can we find on these scumbags?

There's when nothing's going on, they have convinced themselves that something is.

And so what's happened is not just Fox News, but the rest of them is that there was always going to be a conspiracy theory in our world.

And look how much damage it did without the amplification of online.

Now amplified by online, it is.

Look, Hitler didn't need the internet to become Hitler, right?

This has created a situation that the far right is using

to spew conspiracy theories that are going to to be impossible to control

well every every great tyrant or fascist has had their medium and trump and his his cohort uh but look i i think that i think the fbi and the criminal courts are going to hold the mob accountable i'd like to think that voters and maybe the southern district of new york will hold trump and his family accountable it's time for all of those and shareholders to begin holding these media companies accountable they knew what they were doing

They claimed they threw up their arms and said there was nothing we could do.

You know who could solve 90% of the hate speech on Twitter?

A fucking eighth grader with an old laptop by just finding the 35 accounts or the 40 accounts that are that, because it's not only what you're saying, it's how much influence and how much followership you have

and then income the trolls who have a vested interest.

The Russians basically outline this entire strategy.

And what the head of their propaganda machine said was that we never anticipated we wouldn't need to plant the stories.

We need to add some fuel.

But America is now creating its own stories.

And there has to be a penalty when you're a senator, when you're a CEO, when you're on the board of directors of a company, and you knowingly know, you know, remember all the shit, we want to give voice to the unheard.

And, oh, well, lying is bad, but I think the person who's the Holocaust denier should be heard.

No, they shouldn't.

There's danger here.

There's incredible danger.

And this is all from our senators, all from the CEOs of these companies.

And then they immediately pivoted to, well, there's nothing we can do about it.

It would be impossible.

And the cost to do it would not only be bankrupt us and innovation and capitalism and our shareholders, but it would be a threat to the First Amendment.

And that was all a lie.

This is not a hard.

What do you make of the CEO John Mates get sort of on his ridiculous high horse here, which he's like, we believe privacy is paramount.

We all agreed that.

Free speech is essential, especially on social media.

We will not let civil discourse perish.

I think the part of the matter is it's not civil discourse.

It's

no, it's okay.

I buy all of that.

I buy all that.

What I also buy, though, is that when you knowingly create a platform that traffics and profits from misinformation and lies that result in a capital police law enforcement officer being bludgeoned by a fucking fire extinguisher, you bear some responsibility.

So what do you do?

What do you do about the Fox News as well?

Because I think you can't leave them out of it.

I think one of the things internet people have always said is like, well, TV is just as bad.

And I'm like, in some cases, that is the case.

So how do you end that without quashing free speech in some fashion?

I just don't think we have conflated freedom of speech with freedom of reach.

And

I believe that Tucker Carlson should be allowed to say these things.

But the problem is when you have a for-profit company that knowingly spreads misinformation and creates

inflammatory rhetoric that results in violence and insurrection, we have laws that said that that media company, especially if if it's not protected by 230, is liable.

So I'm not denying the right to say it, nor am I denying that family of that police officer who was bludgeoned by a fire extinguisher the ability to sue a company that knew they were spreading misinformation and that resulted in

violence and death.

I think there is a system.

I think these companies have wrapped themselves in the innovator's blanket or 230, or we have been afraid to go after this.

What does the innovator's blanket look like?

It's simple.

I'm an innovator and I write about personal loss and gender equality and I'm a capitalist and oh my God, do you own my stock?

You've done really well.

Or I go on silent retreats and have a beard and a nose ring and speak in slow, hushed tones, which must mean I'm a thoughtful person.

No, you're not, motherfucker.

You are a menace.

Jack Dorsey is a menace.

And civil and criminal courts,

much less his shareholders, need to hold him and his board accountable.

We are not going to move past this unless the bandits, the people that know they're damaging America but profiting off of it, stop leveraging the stupids, the people that damage themselves and damage society, unless we align incentives with externalities and the health of the Commonwealth.

And we have been so fucking crazy overwhelmed with this idolatry of innovators that we have put it on hold and this woke bullshit notion that we need to understand both sides.

No, we don't.

We need to put these people in jail.

They have committed crimes that has resulted in violence and death to innocents.

Yep.

I feel your pain.

So what's going to happen?

So

Peter.

Let's talk about that hot guy.

Let's talk about the hot duke.

We can look at the hot duke and also be angry at these.

We have an ability, Scott, to like a hot duke.

and also be like, what the hell, Facebook?

What the hell, Fox News.

Do you see people like Peter Thiel investing in alternative medicine?

How is Parlor going to come back?

They're just a sim, I mean, in a lot of ways,

I think this guy is just an appalling CEO and he's really quite ignorant.

But I think he's been made a scapegoat of,

even though he's returning with, you know, whatever, whatever, John, whatever.

He has been made a scapegoat to take all the pressure off the bigger companies who I think are much more responsible.

Yeah, just as like Fox News, like Twitter, like Facebook.

It's the heat shield.

So, okay,

Shell Samberg's likability is a heat shield for Mark Zuckerberg.

Mark Zuckerberg is a heat shield for Tim Cook, who becomes very indignant, saying, you know, about monopoly power and security.

They all become heat shields.

And quite frankly, Parlor is the gift that keeps on giving for Facebook and Google because they can go, oh my gosh, they're awful.

Right.

And everyone gets angry at them because they're worse and they're smaller.

And by the way, Facebook has 50%, Facebook has increased the number of lawyers in its legal department by 50% in the last 24 months.

And so they can, they're the new bad guy.

Who benefited more from Facebook than Google, who just kind of sat back and said, oh, yeah, Mark Zuckerberg, that's awful what they're doing.

Right.

So everybody's looking for a new heat shield.

Look at him.

Look at what they're doing.

It's worse.

And the reality is.

I got to say, if I had to pick Mark Zuckerberg and Rupert Murdoch, Rupert Murdoch more.

Yeah.

I think

he just has less power, but he's kind of like,

it has to be Marks.

I think Dorsey's short, but I think it's definitely Mark Zuckerberg, definitely Rupert Murdoch.

And they are the twin poles of where we are right now benefiting from this.

I think Mark is earnest and doesn't can't believe this has happened.

I think Rupert Murdoch knows just what he's doing.

So,

you know, really, if I had to think of

an international worldwide villain, it would be Rupert Murdoch because it's not just here.

It's in Britain.

It's in Australia.

It's in lots of places of freedom.

And this guy has just decimated it with his practices.

Well, there's just sort of different levels.

If you think about the analogy of people who drunk drive have been have driven on average drunk 200 times before they kill somebody or get a DUI,

I mean, Zuckerberg's been at the bar drinking and driving.

Rupert for 40 years has been doing shots behind the wheel.

He's a very bright man.

He knows what he's doing.

He absolutely, and they're very calculated.

When they use the language around conspiracy theories, they say, it's been reported that, right?

It's been reported that, yeah.

Some people say.

Some people say, or

people close to the matter say

they have been very good at going just past the line, trusting that.

Well, they had to pay up to Seth Rich's family.

And that wasn't the beginning of it, but it was one of the moments where they just literally, Sean Hannity just lied.

And so did Lou Dobbs, another winner over there.

And they paid up.

That's the same thing they do around sexual harassment.

They just pay up.

That's what they've been doing, is just paying up for their, and it's a cost of doing business for these people to lay waste to our democracy.

It's a cost of doing business.

Well, that's exactly right.

And

it goes to the algebra of disincentives.

And we do not have to.

Say your next book, The Algebra of Disincentives?

No, my next book's called The Algebra of Wealth: Strategies for Personal and Economic Satisfaction.

Anyway,

no, but the algebra,

we could never have.

In East Germany, at one point, one out of every three government officials was just spying on other citizens or encouraged citizens to spy on other citizens, and they still couldn't keep a lid on it.

So we cannot police all of this no matter how much money we put into the FTC, the DOJ.

We have to have an algebra deterrence.

And the algebra of deterrence is the most powerful cop in the world.

And it says the following.

The likelihood you get caught times the penalty, right, is greater than the expected risk-adjusted upside.

And where the algebra of deterrence is working really well is that if someone calls me and says, Hey, for a hundred grand and I'll donate money to the crew team, I'll get your kid into, I'll get your kid into USC, I'm slamming that phone because Aunt Becky did a perp walk.

And the prospect that someone does a perp walk to try and get their kid into college has cleaned up immediately all of this bullshit around pretending your daughter rose crew.

It has worked perfectly.

There needs to be a perp walk.

The algebra of deterrence is not a problem.

We are going to now listen.

I'm going to interrupt you because I think we're going to be talking about that, which with someone who comes next and what we can do in a second.

One of the things I think that's the most disturbing story of all the many stories that have been around today is that the FBI had to do a vetting of the National Guard that's protecting them all.

It is a depressing scene, and they're worried about conspiracy theorists within the National Guard.

It's just really quite depressing.

And so you're going to see a lot more, tougher regulation in Biden's Washington as the Washington Post has a new story, Silicon Valley braces for tougher regulation in Biden's Washington.

And so we're going to bring on, we're going to take a quick break.

And when we come back, we're going to talk to a friend of Pivot, someone I know very well, FTC Commissioner Rebecca Slaughter.

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Scott, we're back and we have someone I really have a lot of regard for, someone I know a little bit,

Federal Trade Commissioner Rebecca Slaughter.

Rebecca is on the Democratic side, and now that the administration will be, the Biden administration will certainly have a lot more power.

The FTC actually, even with the Republicans in charge, has had a pretty good commissioner who's they've been pretty strong.

They are just under

overwhelmed and under-resourced.

So, Rebecca, welcome to Pivot.

Thanks so much for having me.

I'm thrilled to be here.

So one of the things, last month, the FTC initiated an antitrust lawsuit against Facebook.

When you're looking at all that's happened right now, you live in Washington, you're seeing what's going on at the Capitol in terms of like, it looks like Fortress Washington.

A lot of it has to do with a lot of the hate speech that goes on in these platforms.

And then, of course, there's the antitrust issues.

Where are we going to go from here with the Federal Trade Commission and the federal government with relation to tech companies?

I think it's a great question.

And I think we are seeing the intersection right now of a lot of really important and really difficult issues.

In terms of where the Federal Trade Commission goes, I think there are a few things on our agenda.

Obviously, we filed one big antitrust case that will proceed through the courts.

We will do other investigations and file other cases as appropriate.

And I think we take the very big and very real questions we've heard about outsized monopoly power by large tech platforms really seriously.

A lot of them present novel legal issues and we have to work our way through those.

But just because they're new doesn't mean they're not real.

So that's one area.

The second area I would say is we have a lot of large tech companies under order right now with the Federal Trade Commission for different kinds of violations, privacy, for example.

We need to make sure that those orders are being complied with.

We need to be following up with enforcement actions where they're not.

And that needs to be a top priority.

And then the under research strategy.

Go ahead, finish.

Go ahead.

Yeah.

And then the third thing I was going to say is where we have new investigations, we need to make sure that our enforcement strategy focuses on effective deterrence.

We just shouldn't keep coming back to the same table with the same companies again and again and again.

And that means maybe taking companies to court rather than settling on inadequate terms sometimes.

It may mean with partnering at other levels of government, as we did with the state AGs in the Facebook case.

I think you were about to reference, Kara, the fact that we're pretty dramatically under-resourced, and that's true.

That means that we need to be really smart about our enforcement strategy and make sure that each federal dollar we spend goes as far as it can in making sure we don't have to spend more federal dollars to do more enforcement.

So Scott, I'll have a question a minute, but talk about the under-resourced, because one of the things is the Federal Trade Commission compared to a lot of agencies, you had a commissioner that really pushed through.

He's a Republican, that pushed through this Facebook thing.

It wasn't as politicized as other.

There's a little bit of that, but

it's more an issue of resources, correct?

Yeah.

So as you were referencing, our Republican chairman, Joe Simons, was one of the votes in favor of the Facebook case.

And his motto since he got to the agency has been vigorous enforcement.

And I think he's taken that seriously.

We don't agree on everything, but we've brought a lot of cases in a lot of different areas, and that's important.

But the resource question is real and material and impacts every decision that we make.

One statistic I like to talk about a lot is the fact that at the beginning of the Reagan administration, we had 50% more employees at the Federal Trade Commission than we do today.

Another thing to think about, over the last 10 years, the number of merger filings that we've gotten, mergers that we could potentially investigate, has doubled.

And I haven't done the math on our latest budget round, but before this point, as the filings had doubled, our budget had increased about 10%.

So the workload is really not, or the budget is not keeping pace with the workload.

So they're swamping.

They're essentially

the zone.

And I don't think the under-resourcing is accidental.

So I think it's important that we make clear that we need more money.

Now, let me pause with a plug of appreciation for the outgoing past last Congress that gave us two budget bumps two years in a row at a time when that wasn't happening everywhere.

That's real and material and important and has allowed us to basically keep treading water rather than having to cut back even further.

So that counts for a lot, and we are enormously, enormously grateful, but it isn't enough to let us jump forward in enforcement the way I think we need to to keep pace with the demands of the market.

Scott?

Yeah, we were just talking.

first off, Commissioner Slaughter, I just feel safer knowing that CEOs of media companies occasionally might get a call from someone saying, Commissioner Slaughter is on the line.

That is so badass.

Seriously, that is

well done.

So we were talking.

I like this.

We were talking about the

algebra of deterrence.

Isn't

when Milken broke the law,

he was a billionaire, but basically my understanding is, as a lawyer said, you're up against the DOJ, and they have more resources than we do, and now that's flipped.

And effectively, the smart thing to do is to break the law because, and I'll point to one of your cases, you find Facebook $5 billion, and my understanding has indemnified them for any misdoings along those lines up until that point.

And if someone showed up at my door and offered me an insurance policy that indemnifies me for 1% of my market cap, it strikes me that these agencies have unwittingly become a co-conspirator versus a countervailing force.

Haven't we become

flaccid, anemic?

You know, isn't it a smart thing to do to break the law?

Well, that was exactly my concern with the Facebook settlement.

Yeah, I voted against it and I wrote a pretty long

dissent that I could have said in as few words as you just said right there.

But it was basically that while $5 billion may sound like a lot of money, and it certainly sounds like a lot of money to me, the individual, it was not in this case, enough to make the cost of law breaking

not worth doing.

And particularly when it comes to the

what you refer to as the indemnification.

So I think that

that's something I'm really, really concerned about.

I said in my dissent that I would have rather.

we took them to court if that was the best deal that we could get from the company.

It's important to understand that we as an agency don't have the ability to just issue a fine, even where we think that the company has violated the law.

We have to either take them to court and get a judge to determine an appropriate fine or make an agreement with them about what a fine and negotiate with them what a fine they're willing to pay is.

But it's fair to stipulate in this case that few companies are willing to pay a fine that is not profitable for them.

So it's important for us to think about what the actions we take are and what message that it sends, not only to the specific company, but to the market in general.

I think you're right that a a lot of companies think it might be worth it to dare us to take them to court.

But I will point out in the last

couple months of 2020, we filed at least three merger challenges where we said to companies who are trying to merge, no, we think this merger is illegal and we will take you to court.

They sort of dared us to do that.

And when we did, they walked away from the mergers.

They said, oh, wait, we don't think we're going to win on the law.

We don't want to go through this process in court.

And they walked away.

So our willingness to go to court and make those demands publicly, I think, is an important part of our ability to be deterrent.

So talk about the Facebook lawsuit.

They have not walked away or done anything yet.

What is the theory behind it?

No, we're still pretty early in that case, and there are public complaints out there.

But the general theory that it articulates that you could read in the complaints are

that Facebook engaged in a practice of monopolization

where they took the perspective that it was better to buy or bury potential competitors than to actually compete with them.

And two of the acquisitions that the suits highlight are Instagram and WhatsApp, but those are not the only acquisitions.

You're looking at some of the small acquisitions, too, correct?

That's fascinating to me, the small,

the killer acquisitions, essentially.

Yeah, the lawsuit talks about

basically a pattern of behavior ongoing over many years.

That includes not just these big, well-known acquisitions,

but the general approach of the company that rather than competing, they would rather buy competition and take it off the marketplace.

And that's not what our antitrust laws want companies to do.

We want companies to get out there and vigorously crush their competition by providing a better product and better services for consumers.

So one of the questions I asked, when you, does it change the FTC during the Trump administration?

Can you just explain what happens with the FTC?

There's five commissioners.

What happens next with the commission?

And then how does that change under the Biden administration?

A lot of this attitude.

Sure.

So

the FTC is an independent commission, which is a sort of odd creature of government.

Rather than having a single head who's a part of the executive branch, we have five commissioners who are all presidentially appointed and Senate confirmed.

And

by tradition,

three of them come from the party of the president and two of them come from the opposition party.

So I, Rohit Chopra, and I were the Democratic commissioners over the last several years,

obviously appointed by Trump, but representing a different party.

And then there were three commissioners, including the chairman from the Republican Party.

No one, the chairman hasn't made any announcements about his plans, but traditionally

chairmen of agencies step down when their parties lose, in part because the

incoming

in part because the incoming president can designate anyone else as the chairman.

Um, and so if that happens, as has happened traditionally, then there would be two Republican commissioners left

and a Democratic seat to fill with either a chairman or an additional commissioner, depending on who the president wants wants to put in charge of the agency.

And Mr.

Chopra has gone to the Consumer Financial Protection Board, correct?

Yes, sir.

Very happy, very happy for my colleague, Commissioner Chopra, who was nominated this morning, or his nomination was announced this morning to lead the Consumer Financial Protection Bureau, where I think he will do a terrific job, although he will be sorely missed at the FTC.

When he is confirmed over there, there will be an additional vacancy on the Democratic side at the FTC.

My hope is that those things happen in pretty close order so that the Democrats don't become the minority party at the FTC, even as they have the presidency.

But you have to, you will get the you will get control of that, either you or someone else will become the commissioner, correct?

And there'll be two more Democrats.

Yes, exactly.

There will be a Democratic chair, and then the president will appoint and the Senate will confirm additional seats.

So there will be three Democrats.

The timeline for that is anybody's guess.

In the Trump administration, we didn't get the new slate of commissioners in until almost 18 months into the administration.

I was part of that group.

All of us were part of that group.

But I would expect and hope that we'd move a lot faster.

Commissioner, what, if you think about a lot of the controversy has been over how we distinguish or we create

And I don't know if there are

real distinctions or ones that we have just made up in the abstract, but that we regulate and think of interactive platforms and traditional media companies differently and we regulate them differently.

Do you think that they should be regulated differently?

What do you think of that delta?

Should that delta exist?

It's an interesting question.

I think what you're referring to, Scott, and you tell me if you're pointing at something different, is, for example,

we have lots of regulations over broadcast and newspaper ownership and things like that.

And we don't have similar regulations when it comes to edge providers who are involved in news and media dissemination.

Is that what you're saying?

Everything from cable companies being regulated to libel law.

I mean, it just sounds like they get to play by a different set of rules.

Yeah.

Well, I think that, you know, a lot of rules and regulations that apply today were developed before these platforms and the edge providers even existed, much less had the kind of market power that they have today.

When they were nascent technologies,

wasn't that the wording?

Yeah,

if they were even nascent technologies, right?

Sometimes, you know, some of the telecom laws we operate under date back to the 1930s.

So, you know, they go pretty far back.

And it's true that they have not been adequately updated.

There is clearly a robust, I was going to say healthy, but I will start with robust debate in Congress about how and when and where those laws should be changed and what they should do to protect it.

But my general view is, yes, we should update our laws to keep pace with our markets.

When the laws don't reflect market realities, that's a problem.

It's a problem.

So I have two more questions and Scott might have a final one.

Is you're looking out, you are in Fortress, Washington.

I'm going back there today.

I'm in New York right now.

When you look at what has happened, all these conspiracy theories, the power, I always focus on, everyone always focuses on free speech and everything else.

I focus on the power of these companies being so big and having such an impact and the dissemination happening.

What do you think is the, when you look at this, when you look at Washington right now, federal Washington right now is terrifying.

How much blame do these companies, because it is about their power and you're talking about their power, not about their impact.

How do you sort those two things out?

Yeah, I think it's a really good point, Kara, and I do tend to see it the same way.

I mean, there's a lot of question right now about was it the right decision for various companies to de-platform Trump or de-platform conservatives?

And I think that that's not necessarily the right question to be asking because obviously it was the right question to take away content that was inciting violent insurrection and the violent overthrow of government.

I don't think that's a close call.

But the more complicated question is,

What do we do about a society where that power lies in the hands of individual corporations and we have to rely on them to do the right thing?

That's an enormous amount of power that's that's operating independently.

And one thing I find a little troubling and a little bit ironic is that many of the same folks who are complaining about the deplatforming of conservatives and the effort to silence.

conservatives are the same ones who defend the rights of the market to operate freely and the same ones who resist government intervention and regulation of free market decisions or resist antitrust enforcement.

So I think it's a,

I think what we're seeing is the problem

with that market power from a different perspective right now.

So I think the decisions were right here, but the questions that they raise are really, really big and profound for society.

So as a citizen, I mean, obviously your experience at the FTC will inform this answer, but just as a citizen,

as a parent, I don't know if you're a parent, as an aunt, a parent, whatever it might be, someone who's concerned with the well-being of kids.

She has a lot lot of kids.

There you go.

Oh, she and I have a lot of kids.

But go ahead.

As a parent,

a citizen, a capitalist, or assume you're a capitalist, what platforms or media companies, let's group them all into loosely, media companies?

And I believe the platforms are media companies, do you find

are the most troubling as a citizen and a parent?

That is such a good question.

So first of all, I have four kids

and they range from an infant to a third grader who's doing Zoom school from our house.

I have two elementary school kids were doing Zoom school from our house.

And I have very much grappled with how to,

even before the pandemic, I grappled with how to manage their online lives and introduce them to technology to use for good instead of for

evil.

And it's gotten worse in the pandemic as they have moved more and more online.

And so I worry a lot about content that they might be exposed to that is damaging, dangerous, disruptive,

and particularly that might be out of my own view.

So for example, I will be honest, I have blocked YouTube on all of their devices because I don't know what they're going to get or how they're going to get it and what they're going to see.

And I can't be monitoring them full time.

They are fortunately too young to be on social media sites like Facebook or Instagram.

But I will have a lot of concern when they get to the point where they're militating to be on those because I worry about the messages that they will get.

I worry, honestly, a lot about my daughter and, you know, the images that she sees that

help her define or could undefine her sense of self-worth.

I just think there are a lot of...

Sounds like Instagram.

Yeah, I mean, there are, yes, I think there are a lot of vectors of concern here for me as a parent.

And figuring out how to manage that is difficult.

And part of why I have a real problem with the sort of law, the current legal regime around data right now is it puts all the burden on the parents and all the burden on the consumers to figure out what is going on, what data is being collected, how it's being used, how it's being turned around to manipulate or sell things to people, whether they be adults or children.

And

that is not a realistic expectation.

Yeah, the whole antitrust Bork notion of consumer pricing,

the prices being levied on parents is absolutely skyrocketed.

It's absolutely skyrocketed.

It's a text.

Rubick, I have one final question.

When you look out at the conspiracy theories and everything else that's led to where we are today, do you think the lack of regulation is at the heart of this?

Or do you think it's something just, there's always been conspiracy theories.

Every society from Nazi Germany to the Salem Witch Trials, there's always conspiracy theories everywhere.

I feel like these companies in their size and scope

have amplified them.

But Fox, you could, there was a story, the Seth Rich case was settled just the other day, and it led to all kinds of conspiracy theories.

Does our government have the ability to regulate this?

And I don't want to say should it, but does it have the ability to control what's been unleashed?

Well, I think what we have to go back to all the time is not the content, but also like, why is that content spreading so virally?

And really, at the end end of the day, with every business, the question you have to ask is:

what's the business model?

How are you following the money?

How is the business model here at the selling of advertising contributing to

the dissemination of clickbaity and worse content in order to get more eyeballs, in order to get more clicks, in order to keep people online?

And how is that cycle really damaging to our social fabric as much as anything else.

That's what I worry about, that

the mass, you know, the broad surveillance in order to support a targeted,

micro-targeted advertising system is one that necessarily lends itself to this enragement.

Yeah, this kind of incitement of explosive content because it gets people online, it gets them watching and talking more.

And so I don't think that we can come up with content-only solutions.

I don't think it's about regulating content.

I think it's about thinking about what's the underlying motivation for that content to spread the way that it has spread and cause some of the damage that it has caused.

So those are big, complicated questions.

But if we're not looking at the root of the issue, we're definitely not going to be able to solve them.

100%.

Scott, last question.

Well, no, I just want to remind you that being

a commissioner for the FTC in these times and living in DC with four children under the age of eight, you don't live in the nation's capital.

You're in Vietnam, Rebecca Slaughter.

And I'm talking about the Vietnam of the late 60s.

Well,

I think that was your, that was a thing that just went by, a helicopter.

It was literally a helicopter that just flew by.

I can't imagine what you probably heard as you were saying Vietnam, Scott.

You have your shit more together than anyone I know.

Four kids under the age of eight.

And you're going to take down Facebook.

Yeah, my house, my house.

Listen, nothing could be more chaotic than the house in which I live right now.

So I feel like if I can get through the day here, I can manage other things.

My daughter's teacher used to say, kindergartners can do hard things.

And I say that all the time.

If kindergartners can do hard things, FTC commissioners can do hard things too.

So just a quick question.

Just give us the cliff notes.

How did you end up at the FTC as a commissioner?

What's the career path?

to that?

Well, it's different for everybody, but I spent the 10 years before I was at the FTC working for Senator Schumer in the United States Senate as his chief counsel, first on the Judiciary Committee and then in his leadership office, where my portfolio included a lot of things, but especially oversight of

the FTC and policy work around privacy, technology, antitrust,

and related issues.

So I got a really strong background in policy on the issues that the FTC deals with.

Well, get him on board, Rebecca.

I know he's a little too friendly as far as I'm concerned to them, but

is there a company, is there an area, Leslie, that you're going going to?

There's obviously Facebook and Google have been targeted, has been targeted by

the Justice Department.

Who's next?

Well, I definitely am not going to say anything about any non-public investigations, but I will say this.

If there are big questions out there about the behavior of

companies, tech or otherwise, from either a competition or a consumer protection standpoint, we want to know about them and I want us to be investigating them.

So, you know, we take those things really seriously and the public debate and discussion around them, I think, is helpful to highlight and raise issues that we should be thinking about and help us consider how we should be thinking about them.

Well, on that note, we are going to end.

Rebecca, you're amazing.

I told Scott this was the case.

And I'm so glad there's so many, there's such a canard that a lot of our public officials don't understand these major issues and think they're important and want to protect citizens.

And they do.

Thank you for your good work, Commissioner Slaughter.

Thank you so much.

Thank you for having me.

I really appreciate it.

All All right, Scott, isn't she impressive?

See, don't you feel a little better about her government?

Yeah, I always do when we speak to these incredibly talented people who forego

the opportunity to make

working for Facebook.

She could work

for 100% because they want to do the right thing.

She could make bank.

She could make bank doing that.

And there's a lot of really dedicated people.

We have to stop.

desecrating and we have to escape from the screed started in the Reagan administration that government is bad and that the people that go into government aren't competent people.

Some are, but not really.

I think that there's a lot of people that break into our government are bad and write, you know, and scroll threatening notes to the speaker of the house.

Anyway, we're going to do one more quick break.

We'll be back for wins and fails.

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Okay, Scott, wins and fails.

I'm going to let you do this week.

I think I'm going to do the first failure: the fact that

our nation's capital is a fortress.

That's it.

That's just,

there's no winning this week on that.

And the win is, of course, Biden will be finally inaugurated after all the Michigas Trump has tried to pull.

Well, my fail is

because we don't realize we're so, obviously, the house is on fire, so we don't have time to pay attention to the fact that the house next door is on fire.

It's always been said America can't be the world's cop, but we have been this source of good and a wonderful enforcer, and there was always a notion that America is watching.

I don't think had it not been for this mob and the total

desecration of our

moral authority.

I don't think Alexei Navalny would have been arrested at the airport in Moscow.

I don't.

There's a fantastic documentary.

There's a fantastic documentary called The Dissident about Khashoggi.

I don't think MBS under a different administration would have started killing American residents and journalists.

Agreed.

That guy going into Russia, I thought, oh, arrested at the airport.

And the court, they're having a cultural statement.

And the general notion is...

Oh, they used to be worried about America.

They said, well, America could put economic sanctions on us.

They could start arresting our diplomats.

And now they're like, they're not going to do the right thing.

We don't have to worry about them.

They have people storming their capital.

So

this has just so many,

this is

an opportunistic infection that creates all sorts of disease around the world.

And it's just incredibly,

we are going to be paying the price for this.

And so will the 7 billion people on this planet.

There will be fewer vaccinations because of misinformation.

There will be more girls who don't go to school in developing nations.

And there will be more corruption.

And there will be less freedom around the world because we are no longer the world's force of good and have lost that moral authority.

And I realize that's pretty much Debbie Down.

My win

is

political philosopher Hannah Arendt.

I did not know her, and I've been getting people have been sending me what uh uh things.

I didn't know her, I know, hey, you can take the boy out of the fraternity, 2.27 GPA out of UCLA.

And by the way, all right, okay, let me hear.

Well, I'm excited to hear what you have to say about Hannah.

I've been keeping forward to these quotes, and I'm

the aim of the totalian education has never been to instill convictions but to destroy the capacity to form any.

Under conditions of tyranny, it is far easier to act than to think.

The ideal subject of totalitarian rule is not the convinced Nazi or communists, but people for whom the distinction between fact and fiction and the distinction between true and false no longer exist.

Another one, the point is that both Hitler and Stalin held out promises of stability in order to hide their intention of creating a state of permanent instability.

I just think this, I think this woman, I'm just so...

I think this woman is a genius and I'm embarrassed I didn't know about her and I'm reading her stuff now, but I think she was a gift to the 20th century and her work is getting new examination and new oxygen.

Anyways, my win is Hannah Aaron.

Okay, I think one of her, I studied her quite a bit.

Well, of course you did.

Well,

Calvin got studies in propaganda.

How could you not?

She was a great,

she had a lot to talk about and totalitarianism and quotes and things like that.

One of my favorite is, I just found it again, is the earth is the very quintessence of the human condition.

We are where we are because of who we are.

And maybe we need to look a little bit harder at ourselves because this is not an accident that's happening right now.

Well, that's that's yeah, the world isn't what it is, it's what we make of it.

Um, yeah, anyways, quintessence.

Quintessence.

Look it up, Scott.

That and that hot guy.

You should go to college and teach my son.

I'm going to make him show up at your class if you show up at all, Scott.

2.27 GPA, UCLA, and still got into grad school.

Still got into grad school.

If only you were a professor at a major university.

Hello, I.

If there was a university you were affiliated with where you could learn about people like Hannah, Aaron, and others.

I feel ashamed.

I feel ashamed.

You should.

You should.

I'm going to give you a whole reading list.

It's coming to you right now.

Okay, Scott, that's the show.

I was so impressed with Rebecca and Commissioner Slaughter.

And we will have more interesting people coming up on Pivot in the coming weeks.

And hopefully this time when we tape on Monday, the Trump administration will be over and we are on to a new thing.

So let's hope for better days ahead.

Yeah, but let's be mindful that his administration is over, but Trump and disinformation.

Let's take a minute.

It's over.

Okay.

Okay.

All right.

Go to nymag.com/slash pivot.

It's over for now.

To submit your question for the pivot podcast.

The link is also in our show notes.

Read us out, Scott.

Today's show was produced by Rebecca Sinanis.

Ernie Indra Tott engineered this episode.

Thanks also to Hannah Rosen and Drew Burroughs.

Make sure you subscribe to the show on Apple Podcasts.

Or if you're an Android user, check us out on Spotify or, frankly, wherever you listen to podcasts.

If you liked our show, please recommend it to a friend.

Thanks for listening to Pivot from New York Magazine and Fox Media.

We'll be back later this week for another breakdown of all things tech and business, the hot duke, or as I like to call them, the hook, the hook.

Enjoy the inauguration, everybody.

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