Historically informed commentary on the news and events of the day.
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Caught in an externality trap, Facebook is fighting against the only thing that can save it.
Facebook is caught in a trap of its own making. Despite calls to slow the spread of disinformation and protect user privacy on its platform, the company cannot seem to deliver on Mark Zuckerberg’s promise to “do better.” As a purely technical matter, Facebook likely has the resources to fix its flawed platform. The trouble is that those “flaws” actually drive the company’s profits. Facebook’s harmful side effects are borne by its users—and the world’s beleaguered democracies—without hurting the company’s bottom line (an example of what economists call negative externality). Two years of bad press may have damaged Facebook’s reputation, but it has done nothing to change its market incentives. Instead of “doing better,” Facebook has mounted a bruising backroom lobbying campaign to stymie one thing that might actually help ease its predicament: federal regulation.
Facebook is hardly the first company to fall into an “externality trap.” Historically, almost every major American industry has experienced similar cycles of growth, crisis and regulation. Air and water pollution are now regulated externalities. So are flammable mattresses and asbestos. When it comes to American business history, we’ve been here before. In each case, government regulation has done what none of the industries themselves could do: create sound business reasons for operating more responsibly.
The automobile industry offers one example. In 1965, a young lawyer named Ralph Nader published a book-length expose on the American auto industry, Unsafe at Any Speed. Based on his own research and insights from industry insiders, Nader claimed that American auto manufacturers were capable of making safer cars, but that they prioritized design and cost-control considerations over customer safety. Although he famously singled out the sporty Chevrolet Corvair—whose suspension was liable to essentially collapse during heavy cornering—poor safety design plagued every car on American roads. American carmakers knew that shoulder seatbelts, collapsing steering columns, padded dashboards and toned-down bodywork could save lives. Yet they made money selling those features as extra-cost options, and were deeply wary of accepting liability for their products. Unsafe cars were profitable, and car manufacturers would not change their products until the federal government forced them to.
Unsafe At Any Speed became a bestseller, and Nader immediately launched a campaign for federal highway safety legislation. The carmakers claimed that he didn’t understand the engineering complexities of auto manufacturing, derided his book as sensationalist, and warned that regulation would destroy the auto industry. General Motors even hired a private investigator to find dirt on Nader, for which it was later forced to apologize.
President Johnson signed laws requiring seatbelts in all new cars and establishing the National Traffic Safety Agency in late 1966. The resulting regulatory framework laid the foundation for safer cars, improved roads, and more stringent driver education. It saved lives, and proved that Detroit was capable of making better automobiles.
Facebook’s product is data, and parallels with 60s-era car manufacturers are necessarily imperfect. But they are there. Like the old Chevy Corvair, Facebook’s platform is a profitable but flawed product, imposing severe externalized costs on our privacy and politics. Like GM, Facebook’s unregulated market inhibits it from fixing those flaws. Perhaps federal regulation can also afford Facebook the opportunity to improve its product, and become a more responsible corporate citizen.
This is not to excuse Facebook, which continues to equivocate about the problems with its platform and business model. But those politicians asking the company to simply “fix itself” are also shirking their responsibilities. If Facebook is capable of making a product that is safe for democracy, then publicly elected officials will have to make them do it.
We are the future’s past…
We are the future’s past. That can be hard to wrap your mind around—particularly for young people. So when I teach intro-level college history courses, I like to do a quick thought experiment on the first day of every semester. It goes something like this:
Never mind how it happened—but imagine for a moment that when you wake up tomorrow, it’s actually 100 years in the future. You’re still you, but everything else is different. It would take some time to verify that you’re not dreaming or crazy, process the shock of everyone you know being dead, and escape the evil scientists trying to put you in a lab.
But once you get your bearings and make some friends, you begin to notice things. Like: Future People live in caves because the planet’s surface is too hot to sustain life. Future pizza uses vegan mayonnaise because tomato sauce is too expensive. The next frontier of consumer electronics is wifi that can penetrate 100 feet of bedrock. Most of your new pals have never actually touched a living tree. Things aren’t great!
Turns out, Future People also have some interesting thoughts on how it all got this way. Mostly, they blame you. Not personally maybe, but your generation. If you and your friends hadn’t been so busy doing the Phinckledink—which was all the rage from 2015 until 2023—you could have done something before it was too late. But you didn’t, and now pizza is awful.
Wait a minute, you might say. I’m only 18 years old! I’m not—I mean, I wasn’t—in charge of anything! My own family never listened to me! I haven’t even voted yet. How was I supposed to stop climate change? Also, the “Phinckledink” was not a thing.
Besides, you might also say, it wasn’t just my generation. They’d known about climate change for decades before I was born! Lots of people tried to do something. There were treaties, and electric cars, and some guy named Al Gore made a movie! It was more complicated!
But as luck would have it, at that exact moment, you’re transported back to your home time period, before you have a chance to explain why they’ve got it—and you—all wrong.
It may seem silly, but there is a point to this flight of fancy. The goal is to get young people to wrestle with the kinds of questions that typically occur to us only later in life: about historical agency and complexity, and about our legacies. Young people typically have not yet developed the sense of their own impermanence—of historical humility—that comes with age and experience. But they can use their imaginations to envision a time in which they, along with everyone and everything they know, have passed into the custody of future historians. Many are disturbed just by the notion that their own lives and eras could be so misremembered by future generations. So this thought experiment helps them better contextualize why we so carefully study those who came before us, and how doing so helps us better understand ourselves.
But these reminders of history’s utility in communicating across generations apply to the rest of us as well. The fidelity we owe to the past mirrors the clarity we owe to the future. So when you commission a professional historian to research and create your family or organizational history, you do more than merely celebrate the worth and value of your achievements. You gift the knowledge of yourself to the future. You contribute to the historical record a piece of documentary context that will help make better sense of us all. You ensure that your corner of the world—your area of responsibility—has been duly and faithfully recorded. You communicate. It is an act of community and generosity that can span centuries.
Future historians will thank you for it, even if future college freshmen might not.
Even as our city weathers this crisis, it is vital to reflect on how it came about, and what we can do in the future to improve the resilience of our water supply.
Will the 2018 midterms be fair?
Mexican President Carlos Salinas is sworn in.
Prior to the 1988 Mexican presidential election, outgoing president Miguel de la Madrid selected his fellow Institutional Revolutionary Party (PRI) member Carlos Salinas de Gortari as his successor. Typically, that alone would have enough to ensure Salinas’ electoral victory, given the PRI’s hold on Mexican politics. But Salinas’ opponent that year was a high-profile PRI apostate named Cuauhtémoc Cárdenas, himself the son of a former Mexican president. Running in opposition to his old party, Cárdenas represented a coalition of small, left wing factions called the Democratic National Front. Cárdenas was vying to become the first non-PRI president of Mexico since that party’s founding in 1929. As the election returns started coming in that night—and in spite all of the PRI’s deep, institutional advantages—it looked like Cárdenas would win. But the PRI controlled the government, and the government counted the votes.
In his 2004 autobiography, President de la Madrid admitted that his party rigged the 1988 presidential vote count, recounting the frantic advice of one top PRI official that election night: ''You have to proclaim the triumph of the PRI. It is a tradition that we cannot break without causing great alarm among the citizens.'' In the face of demands to publicize the election returns, the Mexican government claimed that the computer system used for counting the votes had crashed, and declared Salinas the winner. (Two years later, the PRI and the PAN agreed to burn the physical ballots, erasing the evidence of the ballot rigging). The episode, later referred to as “la caída del sistema,” (the crash of the system), became a kind of cynical, knowing shorthand for the rot at the heart of Mexican politics.
Viewed more broadly, Mexico’s PRI is a case study in the long term conservation of institutionalized political power. Over 9 decades, it never permanently lashed itself to any particular ideology. Founded as a paternalistic democratic socialist party, the PRI had evolved by the 1980s to champion a doctrinaire form of neoliberal capitalism. Variable ideology and bad governance notwithstanding, no organization outside the Iron Curtain was better at gaining, holding and using political power in the 20th century. Mario Vargas Llosa famously called it the “perfect dictatorship.” As Mexico’s “state party,” the PRI’s enormous will to power manifested as a patented formula of official graft, electoral fraud, political violence and demagoguery. Given its history, the PRI’s decision to blatantly rig the vote for Salinas in 1988 seems overdetermined. A political party bent on preserving power will use any tool available, including the machinery of the state.
The search for historical parallels and antecedents to current American political events keeps leading me to the histories of countries with weaker democratic traditions. Which seems ominous. But like the PRI of the 1980s, the GOP is ideologically incoherent, procedurally unmoored, and increasingly corrupt. Like the PRI, the Republicans’ control over the machinery of the state theoretically gives them the ability to alter the results of America elections ex post facto.
On the left, the rhetoric surrounding the stakes of the 2018 election borders on apocalyptic. Democratic voters are angry and motivated, and recent polls appear to show a clear path for the Democrats to retake the House, and possibly even the Senate. Even with the massive structural advantages afforded the Republicans by geography and gerrymandering, the Democrats appear poised for major gains.
But the stakes are just as high on the Republican side. The more entangled the Republican Party becomes in Trump’s efforts to cover up his Russian collusion and obstruction of justice, the more vulnerable rank-and-file Republicans become to political and even legal reprisal for having doing so. For Republicans, winning the next election may not simply be a matter of keeping their seats, but of preserving their personal wealth, social status, future employability, and felony-free criminal records. They’re in too deep to walk away now.
The Republican Party now controls all three branches of the federal government, and enjoys total legislative and executive control in 26 states. Republican secretaries of state preside over elections in 32 states. Like the PRI in 1988, the Republicans of 2018 face a choice: either leverage their undemocratic advantages or risk losing them. This fall, some in the GOP will be tempted to effect their own caída del sistema. We can only hope that their voices do not carry the day.
The highest bidder isn’t always American.
Since the Supreme Court’s landmark 2013 Citizens United decision that political donations by independent entities (i.e. unions, corporations, etc.) are a form of free speech, Vladimir Putin has been speaking with a mighty voice in American politics. Technically, it’s illegal for foreign nationals to contribute to American political campaigns, but the law’s loopholes are big enough to drive a Russian tractor through. In 2016, it was cheap and legal for anyone to buy online political advertising that amplified social divisions and spread disinformation, so long as it didn’t mention a candidate. And in the absence of an enforcement mechanism, Facebook was happy to run any ad it could make money from—even those that fell afoul of existing campaign finance laws.
Neither was it difficult for Russian operatives like Alexander Torshin and Mariia Butina to find American collaborators through which to funnel political money. The National Rifle Association appears to have been one such willing partner. The NRA’s dark money arm, the Institute for Legislative Action, spent a reported $35 million in election-related activities for 2016, including untraceable independent expenditures like this 30-second, “Hillary did Benghazi” attack ad. The ILA’s expenditures for 2016 represent a 270% increase over the previous election cycle. Under current campaign finance regulations, the NRA is not required to identify where that money came from, and it looks like a lot of it came from Russia.
If Russian money influenced the electoral outcome in 2016, it’s worth noting that it did so in the same way as the money from Sheldon Adelson, Paul Singer, the Kochs, the Mercers, and any number of other American billionaire activist donors. If Russian intelligence agencies helped put Donald Trump in the White House, then it’s worth remembering that the majority of the Republican Party welcomed their assistance. And our campaign finance laws are such a toothless mess that experts aren’t even sure any of it is illegal.
The bottom line is that with loose campaign finance laws and deluded Supreme Court rulings like Citizens United, we have remade our own political system into a key battlespace in a global information war. And while Republicans are still too pleased with the outcome of the 2016 election to see it, that’s very bad for everyone who lives in and/or cares about the United States. Without stronger financial disclosure laws, Vladimir Putin is just another skilled and deep-pocketed player in the graft-fest that we’ve made of our own elections. In a perfect example of this dynamic, Concord Management and Consulting, a Russian firm under investigation in the Mueller probe for illegally interfering in an American election, is now citing previous decisions by Trump’s Supreme Court nominee Brett Kavanaugh to argue that all charges against it should be dropped. Quite the coincidence how Kavanaugh’s name made it to the top of the pile.
Obviously, Citizens United won’t be overturned any time soon, although there are things we can do to mitigate its damage in the meantime. But that decision, and the 2016 election, should be an alarm bell for anyone who cares about the preservation of democracy in America. The cynical, transactional, and laissez-faire view of our political system as just another unregulated marketplace represents an existential threat to our ability, and our right, to govern ourselves.
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