Andrew Harnik/AP Photo
Facebook CEO Mark Zuckerberg arrives for a House Financial Services Committee hearing on Capitol Hill in Washington, October 23, 2019.
Facebook CEO Mark Zuckerberg testified before the House Financial Services Committee today about the proposed Libra digital currency, which has taken a beating lately. Payment processing firms Visa, MasterCard, and Stripe have backed out of the project, along with Booking Holdings, the parent company of Priceline, Kayak, and dozens of other travel sites. The last one is important, because the whole point of Libra is to allow users to buy tangible items online, and travel is one of the biggest such purchases.
In his opening statement, Zuckerberg preempted the questioning by distancing his company from Libra. “I don’t know if Libra is going to work,” Zuckerberg said, adding that he was aware of not being “the best messenger for the product.” He made it sound like Facebook was a passive, no-show board member, rather than the driving force behind Libra. Asked by Representative Blaine Luetkemeyer (R-MO) if he would be willing to stop the project if it couldn’t get regulatory approval, Zuckerberg said, “I will certainly stop Facebook’s part of it.”
The hearing exhibited a reversal of the usual media snickering that an out-of-touch Congress knows nothing about tech. Zuckerberg looked clearly out of his depth, parroting doublespeak about regulatory compliance. Financial Services Committee members know plenty about bank regulations, and they gave Zuckerberg an earful about them. “How can you know your customer with an anonymous account?” shouted Representative Brad Sherman (D-CA), who talked for five nonstop minutes about the absurdity of the concept without asking Zuckerberg a question. Representative Greg Meeks (D-NY) wondered if Facebook ever donated to initiatives to bank the unbanked before launching Libra, allegedly a tool for financial inclusion. (They hadn’t.)
Zuckerberg said he considered Libra to be a payment system, which would require none of the obvious coinage machinations Libra is attempting. He added that Calibra could be thought of as a bank—a holder of currency—but said they’re not applying for a bank charter. “That’s the problem!” exclaimed Ed Perlmutter (D-CO).
Most of the hearing followed a familiar pattern: Members would ask Zuckerberg some version of “There’s no way Libra’s ever going to happen, right?” And then they moved on to talking about other Facebook concerns, whether election disinformation, or discriminatory advertising, or in one bizarre sequence by Representative Bill Posey (R-FL), censorship of anti-vaxxers. The point is that members of both parties are incredibly skeptical of Libra’s existence; they have plenty more to worry about with Facebook.
