Washington’s Knives Are Out for Big Tech’s Social Media Shield

(Bloomberg Businessweek) -- President Donald Trump, angered after social media companies blocked a misleading video posted by his campaign, said on a radio show on Aug. 6 that “of course” he’s being censored, as are conservative Republicans in general. And he’s proposing to do something about it: Trump is trying to expose the likes of Twitter Inc. and Facebook Inc. to legal liability for what their users put online, as well as for their own decisions to block accounts and comments.

Section 230, a clause in the 1996 Communications Decency Act, is the legal bedrock of social media, originally intended to protect the bulletin boards that were a prominent feature of a very young internet. The language lets companies moderate—or decline to moderate—online discussions without risking lawsuits.

The legal shield has become a target for right and left alike. Critics say social media platforms should be held accountable now that they play an outsized role in shaping public opinion. In a statement in May, a spokesman for Democratic presidential candidate Joe Biden said the companies should be held accountable for disseminating content they know to be false, just as any other private company would be.

The argument over Section 230 “sets up a volatile 2021,” Paul Gallant, an analyst for the investment bank Cowen & Co., says. “A lot depends on who controls the White House after November. But either way, both parties dislike the status quo.”

Republican and Democratic lawmakers, the president, and regulators are questioning how Big Tech firms handle online debate. Democrats say too much hate, election meddling, and misinformation get through, while Republicans claim their ideas and candidates are censored.

“There is a very broad political constituency on both the right and the left that want to change” Section 230, says Blair Levin, a former Federal Communications Commission chief of staff. “It’s a clear and easy target.”

For the biggest players, more carefully policing content would probably mean bolstering the ranks of thousands of hired moderators and facing down far more lawsuits. For smaller players, the tech industry argues, it could prove ruinous.

Those who would rein in the platforms are exploring several methods, from modifying the 1996 law to changing regulations. Lawmakers on Capitol Hill have an array of proposals. A handful of bills target political speech, but they’re probably doomed by the partisan split between conservatives, who say too much content is being blocked, and liberals, who say more content ought to be.

Measures that focus on consensus goals such as reducing harm to children or suppressing illegal content may have the best chance of success. “That seems to be where the real momentum is,” says Neil Fried, former counsel on the House Committee on Energy and Commerce. “There’s a lot of people that are concerned about hate speech and bias and fake news, but those I think are going to take longer to sort out.”

A bill from Senator Lindsey Graham (R-S.C.), a Trump ally, would allow for more victims’ lawsuits against companies that present or distribute child exploitation material. The bill passed out of committee unanimously in July over complaints from the tech industry that it would allow states to ban encryption while doing little to stop practices that are already illegal.

Senators John Thune of South Dakota, the No. 2 Republican, and Brian Schatz, a Hawaii Democrat, have offered legislation to require online platforms to explain their content moderation practices in a policy that’s easily accessible for consumers. Their bill, the PACT Act, also would require platforms to take down posts that courts have found to be illegal, such as those that are defamatory.

Several other proposals aim to ensure that the Federal Trade Commission and state officials can penalize companies that break promises, such as those stated in terms of service—and even potentially, in executives’ public comments. Such assurances can range from saying a company will take down threats of violence to asserting that its content moderation is not politically motivated.

Even the Trump administration has gotten involved in what might normally be left to Congress: The Justice Department in June outlined proposed changes to the law and reinterpretations for courts. These reforms would remove companies’ protections if they promote illegal speech and would limit their discretion in taking down political posts.

Just weeks before, Trump, in the name of protecting political debate, ordered the administration to seek rules from the Federal Communications Commission that would limit when companies can claim the shield under Section 230.

“We cannot allow a limited number of online platforms to hand-pick the speech that Americans may access and convey on the internet,” Trump said in his May executive order that sent the issue toward the FCC. The executive order argues that when tech companies remove or attach warning labels to posts, that means they should be “exposed to liability like any traditional editor and publisher that is not an online provider.” The order states this is “applying the ideals of the First Amendment to modern communications technology.”

Critics decry that reading. “The First Amendment protects speakers from government action. It doesn’t protect them from private action,” says Daniel Lyons, a visiting fellow at the American Enterprise Institute.

The FCC doesn’t appear to be hastening to adopt Trump’s change. Chairman Ajit Pai, a Republican appointed by Trump, said on Aug. 3 that the agency would take comments for 45 days, pushing the next possible action to mid-September or later. After that, the FCC could vote to take yet more comments on a proposed rule, with a final vote to come months later.

Odds that it will do the president’s bidding seem reduced since the White House withdrew the nomination to another term of a sitting FCC Republican, Michael O’Rielly, who had spoken skeptically about moving against social media. The withdrawal would make it less likely that O’Rielly would vote for the Trump proposal. With both Democrats on the five-person FCC board signaling opposition, the votes of the FCC’s two other Republicans aren’t sufficient to open a rulemaking, barring a conversion by O’Rielly (who declined through staff to comment).

“It’s very hard to see it getting anything to finality before the end of the year,” says Andrew Jay Schwartzman, a veteran communications lawyer. “This is political. Everybody on the Republican side is mad at the social media companies. This is a way of hassling them.”

Even with immediate action unlikely, Trump’s foray has raised alarms among internet advocates.

“The demand that the FCC take on the role of ‘Ministry of Truth’ is designed to pressure social media companies to bias content moderation decisions in the administration’s political favor,” says Matt Schruers, president of the tech trade group Computer & Communications Industry Association.

Trump’s Aug. 6 complaint about the blocked post was specific, but his broad claim of unfairness underscores a newly perilous position for Silicon Valley in Washington. The biggest tech companies are likely to remain in the political crosshairs beyond November’s presidential election, whatever the result.

“No matter who wins, the losing side will blame tech for the outcome,” says Carl Szabo, vice president of the trade group NetChoice, whose members include Alphabet Inc.’s Google, Facebook, and Twitter. —With Jennifer Epstein
 
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