Tech's legal shield under bipartisan attack as CEOs face lawmakers: 'There is more common ground than people realize,' Democrat says

Key Points
  • The CEOs of Facebook, Google and Twitter will face lawmakers once again on Wednesday — this time to defend the legal liability shield that underpins their business models.
  • Sen. Richard Blumenthal, D-Conn., said there's bipartisan support for some limits on Section 230 of the CDA but said Republicans are trying to "game the ref" by having the hearings so close to Election Day.
  • Sen. Marsha Blackburn, R-Tenn., criticized the platforms' alleged censorship of conservative voices, saying they "do things they know they ought not to do, and they push it until we slap their hands."
Twitter's former head of news on what to expect from tech CEOs testifying on Capitol Hill
Twitter's former head of news on what to expect from tech CEOs testifying on Capitol Hill

The CEOs of Facebook, Google and Twitter will face lawmakers once again on Wednesday — this time to defend the legal liability shield that underpins their business models.

For Facebook's Mark Zuckerberg and Google's Sundar Pichai, it will be their second time testifying before Congress this year, following July's antitrust hearing in the House. For Zuckerberg and Twitter's Jack Dorsey, it will be the first of two sessions before Congress within the next month. The two agreed to testify before the Senate Judiciary Committee in November after Republican members voted to authorize subpoenas.

Like the antitrust hearing, Wednesday's Senate Commerce Committee testimony has the potential to be bruising for the tech companies because nearly every lawmaker has an interest in it. Republicans and Democrats on the committee have expressed shared concerns over the way tech companies moderate — or fail to moderate — content on their platforms without repercussions, misuse users' data and impact local news organizations.

"I think that there is more common ground than people realize," said Sen. Richard Blumenthal, D-Conn., of Republicans' and Democrats' approach to reforming the legal shield known as Section 230. "Once we move beyond the election I think it will be a lot of opportunity for bipartisan consensus."

Twitter CEO Jack Dorsey: Eroding Section 230 'could collapse how we communicate on web'
Twitter CEO Jack Dorsey: Eroding Section 230 'could collapse how we communicate on web'

In the meantime, lawmakers' questions Wednesday are unlikely to show a completely united front. The proximity to Election Day — less than a week away — will only add fuel to the discussion. Blumenthal hinted the timing was not ideal, suggesting some of his Republican colleagues are trying to "game the ref" and "in effect, bully the platforms right before the election."

Section 230

In part, the committee will be looking at the protections offered by Section 230 of the Communications Decency Act. The statute has insulated tech platforms from legal liability for their users' posts since the late 1990s. But in recent years, lawmakers across the political spectrum have taken issue with its broad protections as the industry's power and reach have become more apparent.

Changing the law is tricky because it also allows for tech platforms to moderate posts on their services, including removing violent or terrorist-related content.

For Sen. Marsha Blackburn, R-Tenn., the hearing is an opportunity to discuss concerns that the platforms express bias against conservatives through their moderation decisions. Democrats and the tech platforms themselves have dismissed such allegations.

Blackburn said tech companies have been "misappropriating" Section 230 by "pushing the envelope" with their moderation standards. Her bill would lay out specific categories of content platforms would be protected from moderating instead of leaving it up to the tech companies to determine what they find to be "objectionable."

"They do things they know they ought not to do, and they push it until we slap their hands," Blackburn said. "And then they kind of come back around and they calm down, then they go back to trying to push it a little bit more. So by doing this, what they've done is to turn that shield, which was a very transparent shield, they've made it very opaque. And they hide behind saying, 'These are our community standards.'"

Blackburn told CNBC in an interview last week she plans to ask the CEOs about her proposed changes to Section 230 through the Online Freedom and Viewpoint Diversity Act. The bill, which she introduced with Commerce Committee Chairman Roger Wicker, R-Miss., and Judiciary Committee Chairman Lindsey Graham, R-S.C., would narrow the types of content from which tech platforms would be protected from liability.

Democrats have been more concerned with the platforms' failure to remove or moderate what they see as harmful or misleading posts.

Blumenthal, who co-sponsored a separate Section 230 reform bill with Graham called the EARN IT Act, said in an interview Tuesday that the Online Freedom and Viewpoint Diversity Act is not "sufficiently targeted to the specific wrongs or harms that they want to stop." He said that attempting to remove the subjectivity of "objectionable" material that platforms can remove without penalty, as the Republican bill proposes, is "dangerous."

Blumenthal acknowledged that it's too late to reform Section 230 before the election but said it's important to know how the platforms plan to handle disinformation about the results. He plans to ask the CEOs how they will address attempts of voter suppression and foreign interference on their platforms. He will also ask how they would handle users — including the president — casting doubt on the election results.

One recent event that is almost certain to come up at the hearing is the platform's handling of a recent New York Post article. The story was based on emails allegedly taken from a hard drive belonging to former Vice President Joe Biden's son and supposedly obtained by former New York City Mayor Rudy Giuliani, the president's personal lawyer.

Facebook and Twitter took very different approaches to how they moderated the article, which the Democratic presidential nominee called a "smear." Facebook reduced the distribution of the post while it underwent a fact-check review, while Twitter initially prevented users from sharing the article at all under its hacked material and private information policies. Twitter later reversed that decision.

A Facebook spokesperson noted that the company has advocated for regulation, including FOSTA/SESTA, a set of bills that removed liability protection for sites that facilitate sex trafficking.

A Twitter spokesperson said in a statement that Dorsey will discuss "how Twitter has led with transparency and been an industry leader by being the first to ban political ads and ads from state-controlled media."

Dorsey will also share his perspective on how Section 230 can be made "resilient and reflective of the realities of where the Internet is now," according to the statement.

A Google spokesperson did not immediately provide comment for this article.

Privacy and impact on local media

Lawmakers will also discuss data privacy and tech's impact on local media organizations. The additional topics were a concession from the Republican majority on the committee to Democrats.

Ranking member Sen. Maria Cantwell, D-Wash., initially opposed the hearing because of its focus on Section 230 in the context of allegations of anti-conservative bias. But she ended up supporting the hearing after Wicker agreed to expand its scope.

Cantwell released a report ahead of the hearing on Tuesday highlighting the decline of local media. The report found total newspaper revenue will have fallen 70% by the end of 2020 compared with 20 years ago and blames large tech platforms such as "Google and Facebook, which have become the dominant players in online advertising." Both companies have given away money to local news outlets, but the report discusses their broader impact on the industry.

While there is broad interest among the Commerce Committee members in all the issues of Wednesday's hearing, disagreements over how to address them have kept legislation from advancing. Wicker and Cantwell have both introduced national privacy bills and stressed the urgency of enacting such laws. But they've remained far apart on questions of whether the national law should override state laws and if individuals should be able to sue when they believe their rights are violated.

A senior committee aide for the Republican majority told CNBC that consensus may look more achievable after the upcoming election.

"Everybody in many ways kind of goes to their corners and waits for what the election results look like," said the aide, who was authorized to speak only on background. "So I think we're kind of at that point. But hopefully after the election, tempers and heads will cool and minds will be more open to compromise. But this close to the election, it's hard to find bipartisan consensus on much of anything."

Blumenthal said he believes it's possible to create "a path forward on preemption," though negotiating private rights of action "are more difficult." With a strong national bill, Blumenthal said, committee members could explore ways to "modify" private rights of action and preemption to find a middle ground.

"I think we're going to be able to work through some of these [issues]," Blackburn said. "I think the more that our colleagues hear from people in their communities, it is going to help spur sitting down at the table and working through these issues."

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