The big hearings in Washington, D.C., right now are focused on Supreme Court nominee Brett Kavanaugh, but as MarketFoolery host Chris Hill and Motley Fool Asset Management’s Bill Barker discuss in this segment from the Market Foolery podcast, elsewhere in the Capitol, our senators were grilling another sort of power player on Wednesday.
Twitter (NYSE: TWTR) boss Jack Dorsey and Facebook (NASDAQ: FB) Chief Operating Officer Sheryl Sandberg fielded questions about foreign interference in U.S. elections, the proliferation of fake news, and assertions that their systems are being used in ways that favor Democratic ideas. And of course, they talked about what they think their companies should be doing to reduce the problems. But as with so many things involving social media, the parties in the conversation were probably talking past each other and not really listening.
A full transcript follows the video.
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This video was recorded on Sept. 5, 2018.
Chris Hill: As you and I are sitting here recording this, across the river on Capitol Hill, all eyes on Jack Dorsey, the CEO of Twitter, and Sheryl Sandberg, the Chief Operating Officer at Facebook, as they are spending some quality time with some members of the United States Senate. You and I were talking about this earlier. Certainly, in the in the coverage leading up to this hearing, which is ongoing right now, there certainly was a lot of speculation about where it might go, what questions might senators ask, what might the answers be, what possible ramifications could there be for these large businesses — including Alphabet, by the way. Alphabet decided they weren’t going to send anyone to testify to this. There was some open mocking of Alphabet at the hearing because of that. But, as you and I were talking earlier today, it seems like the way to bet is on how these things have played out in the past. We’re not sure exactly what Jack Dorsey and Sheryl Sandberg are going to say, but we have a pretty good guess at what they’re going to say. Is that fair?
Bill Barker: I think that what they’re going to say is that they agree that more needs to be done, and they’re going to direct the who needs to do it toward themselves. That is the best-case scenario — they are not faced with regulations from Congress or anywhere else, and that they can show, as I believe they are showing, that they’re spending more money on confronting fake accounts, and that they are handling it. They need to show some results, and they have been showing results, in terms of how many accounts have been shut down. They have to tread carefully. In terms of what questions the senators are asking, I imagine a lot of senators are there more to make speeches than to ask questions, not having watched it. I think that’s the way these things do play out.
Hill: That is typically how they play out. This is one of those times where it’s worth remembering that, once upon a time, before she was Chief Operating Officer of Facebook, Sheryl Sandberg was one of Larry Summers’ top lieutenants when he was the Treasury Secretary. So Sheryl Sandberg very much knows her way around Washington, D.C., and these types of…well, I’m not sure. I’m guessing he’s going to comport himself well. I watched a little bit of the opening of the hearing, and Sheryl Sandberg was every bit as impressive as I expected her to be. But, to your point, there’s going to be a lot of, “Yes, Senator, that’s a great point. Sure we need to do more.”
Barker: “That’s a great question.”
Hill: “We’re doing more. Obviously, we can always do more.”
Barker: “And we are doing more, obviously.”
Hill: “Here are the steps we’re taking.”
Barker: The landmine in particular that is being placed in front of them is, there are people taking their lead from the Administration on the accusation that Twitter and/ or Facebook are biased against the Republican Party. Dorsey and in particular, has to say, “No, this is what we’ve done. This is why it’s even-handed. This is the data that we have that shows that a tweet from somebody from the right gets read as much as a tweet from somebody from the left. Here’s our proof.”
I think that is the kind of mathematical proof that is not going to convince anybody up there who is out trying to make a sound bite point. I don’t think that the ultimate audience for that conspiracy theory is going to be dissuaded by evidence. But that’s all that I think Dorsey and Sandberg have on their side, is to produce, to manufacture evidence that there isn’t a political bias.
Hill: To go back to the response, this gets made fun of, and probably rightly so, the number of times on a quarterly conference call that an analyst will lead his or her question for a company’s management by saying, “Great quarter, guys! Here’s my question.” In fact, I think there might even be a Twitter account that’s called GreatQuarterGuys. You never want to play that drinking game when you’re listening to conference calls. By the same token, I don’t think you want to play the drinking game today of, take a drink every time Sheryl Sandberg or Jack Dorsey begin their answer with “Well, that’s a good point, Senator.” “That’s a good question, Senator.” We’re going to hear that a lot.
Barker: “But, if I could explain this in terms that your grandchild would understand,” which would be more productive than trying to explain the internets to you. It’s not a series of tubes, as we know, from some distant congressional hearings.
Hill: How great would that be, by the way, if Dorsey and Sandberg could just say whatever they wanted? If it’s the fifth hour of the testimony, they’re like, “Oh, really, Senator? Yeah, OK. You’re on Instagram? Great! How’s that going?”
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Bill Barker owns shares of Alphabet (C shares). Chris Hill has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Facebook, and Twitter. The Motley Fool has a disclosure policy.