Facebook’s whistleblower goes to Europe

This is an audio transcript of the FT News Briefing podcast episode: Facebook’s whistleblower goes to Europe

Marc Filippino
Good morning from the Financial Times. Today is Friday, November 12th, and this is your FT News Briefing.

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Days after General Electric splits itself into three, one of Japan’s industrial icons considers a similar plan. Facebook whistleblower Frances Haugen was in Britain and the EU this week pushing for stronger laws to control online harm, and we’ll end the week with Katie Martin’s insights on inflation and Elon Musk’s latest stunt.

Katie Martin
It’s not obvious who has been harmed here. It just builds this picture of a really trivialised computer game kind of stock market, which is not what it’s set up to be.

Marc Filippino
I’m Marc Filippino, and here’s the news you need to start your day.

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The Toshiba drama continues. Shareholders have been pressuring the Japanese conglomerate to either accept a buyout or radically restructure, and Toshiba seems to be ruling out the option of taking the group private. Today, the industrial titan is expected to present a plan to split itself into three separate companies. Though one of those, probably a company specialising in smaller devices and semiconductors, could be sold to a private equity firm. Shareholders will have to approve the restructuring, and that could be a problem for Toshiba. Nine big investors spoke to the FT, and they said they found the plan disappointing and unrealistic.

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Facebook whistleblower Frances Haugen was in the UK and Europe this week. Lawmakers on both sides of the channel are working through legislation that would hold tech companies liable for illegal content like hate speech on their sites. But Haugen urged them to broaden the scope of their legislation. Here’s the FT’s European technology correspondent, Madhumita Murgia.

Madhumita Murgia
So a bone of contention both in the UK and the EU has been in terms of the new laws that are being drafted. What type of content should be regulated under these laws? Obviously, we have included illegal content, which includes things like terrorism, and those are things that Facebook’s algorithms are being developed to pick up. But she believes, and this is the core of the debate, that the regulations should also embrace and oversee harmful but legal content. But she believes these things should also be regulated because they cause harm.

Frances Haugen
Facebook’s algorithms, so like when they’re doing risk assessments, right now they’re limited to illegal content like terrorism. But they wouldn’t have to cover things like the fact that these algorithms pull people down rabbit holes. And in the case of kids, they can follow very neutral interests like healthy eating and be drawn into anorexia content. That’s not illegal. But it’s really harmful and kids die as a result of those things.

Marc Filippino
So when you spoke to her in Brussels, Madhu, did Haugen say what’s next after this trip? I mean, will she continue to travel around the world being an activist for stronger social media regulation?

Madhumita Murgia
Yeah, I mean, she’s a data scientist, and she mentions this quite frequently to kind of specify what her expertise is and, you know, working specifically on online safety related stuff. She’s not really been somebody who’s worked in politics or policy, even. So, this is quite a shift for her. I mean, she tells us that she’s just looking forward to going back home to Puerto Rico and kind of taking a step back from the limelight, but also that she was very much open to working with anybody who was interested in investigating further what was happening on Facebook’s platforms and who wanted to hold Facebook to account. She did, however, say that she, it had taken her a long time to come to this decision, to kind of put her name forward and to speak out about what she believed was happening at Facebook, and she really wrestled with that decision.

Marc Filippino
Yeah, I want to play something that she told you, related to that period in her life.

Frances Haugen
I feel really blessed that I got to live with my mother last year for six months. And so while I was agonising on, like, the things I was learning, I basically got infinite free therapy, right? Like my mother was a priest. She is great for, like, crisis of conscience. Ultimate amenity. And so I aligned myself with the consequences a long time ago, like nothing that could happen to me is worth the lives of 10 million people. And I genuinely believe that choices that Facebook are making are jeopardising the lives of millions or tens of millions of people.

Marc Filippino
That was Frances Haugen speaking to our European technology correspondent, Madhumita Murgia. You can see the whole interview with Haugen at FT.com. And we’ve got a link to the video in the show notes.

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The latest US inflation report has the financial markets betting once again on an interest rate rise from the Federal Reserve. That expectation lifted the dollar to its strongest point against the euro in more than a year. But Fed chair Jay Powell only last week was still pledging patience, and the view of the US central bank is still that high inflation is transitory. I’m joined now by our markets editor, Katie Martin. Hey, Katie.

Katie Martin
Hey, how you doing?

Marc Filippino
I’m doing all right. Katie, what do you make of these inflation numbers and how the markets are reacting to them?

Katie Martin
Well, so the first thing to note really is just how big these numbers are, you know. So annual inflation in the US by this measure is running at 6.2 per cent. That’s significantly higher than it was in the previous month and is also much higher than the market was expecting. And that’s the fastest pace since 1990, which people insist on telling me is 31 years ago. Not that I can easily believe that, but so there you go shows how old . ..

Marc Filippino
That must be the scariest part of that report.

Katie Martin
How can that be true? [laughs] Anyway, the inflation is everywhere, right? It is in energies and shelters, it’s in food, it’s in used cars, it is in new cars. The gasoline index is up 6.1 per cent in a month, up 50 per cent in a year. So, you know, as you’re kind of going about your weekly shopping, if you feel like things are getting more expensive, you’re not imagining it. Things really are getting a lot more expensive really quickly, and you can see it in lots of different types of food, for instance. And yes, you say this is a big challenge to the message that a lot of central banks have been spitting out this year, which is, don’t worry everybody, inflation is transitory, transitory, transitory. Don’t worry, this is going to calm down. And this is the data release that suddenly makes people think, are you sure?

Marc Filippino
Right.

Katie Martin
[Laughs] You know, this is a punchy number, and the important thing about that is, you know, yes, markets are terribly important. I would say that because I’m the FT’s markets editor. [laughter] But what is much more important than that is that this really affects household incomes. Some of these price increases are most painful for people who are on the lowest incomes. On the market’s front yet it does again get us debating, and I feel like we’ve been having this debate forever now, but you know, when does the Fed say enough is enough and speed up the pace of tightening? The difficulty with that is that no amount of monetary tightening is going to solve the bottlenecks in supply chains. Part of the reason why, for example, energy prices in Europe are so high is because there’s been a lack of wind in Europe. Again, no amount of central bank tightening can make the wind blow. So this is the sort of inflation that’s quite difficult for central banks to deal with or to help to mitigate. And so we really are in a bit of a pickle at this point.

Marc Filippino
All right. We’re gonna reward everyone who has stuck around through our chat about inflation and talk about Tesla now, which is which is what everybody wants us to talk about.

Katie Martin
Is it? OK. [laughs]

Marc Filippino
Well, I think so. I don’t know. And of course, we’re talking about Elon Musk, who asked his Twitter followers if he should sell 10 per cent of his stake in the company. Now we found out late on Wednesday night that he was planning on doing this regardless of the outcome of the Twitter poll.

Katie Martin
This is a very normal way to run a trillion-dollar company. [laughs]

Marc Filippino
Correct, yes. The first car company to pass the trillion-dollar mark. Very normal. Very normal, Katie.

Katie Martin
Entirely normal, yes. So over the weekend, yes, he ran this Twitter poll. Hey, what do you guys think? Should I sell 10 per cent of my stake? And then it turns out that he sold $5bn worth of stock in Tesla early this week. And some of the regulatory filings, though, indicate that he actually had those plans in place before he put the tweet out. This is not stuff that most senior corporate executives of major listed companies do, I think it’s safe to say. But these sorts of antics are precisely why a lot of people love him and love the stock.

Marc Filippino
Katie Martin is our markets editor. Thank you, Katie.

Katie Martin
Pleasure.

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Marc Filippino
You can read more on all of these stories at FT.com. This has been your daily FT News Briefing. Make sure you check back next week for the latest business news. The FT News Briefing is produced by Fiona Symon and me, Marc Filippino. Our editor is Jess Smith. We had help this week from Peter Barber, Gavin Kallmann and Michael Bruning. Our global head of audio is Cheryl Brumley, and our theme song is by Metaphor Music.

This transcript has been automatically generated. If by any chance there is an error please send the details for a correction to: typo@ft.com. We will do our best to make the amendment as soon as possible.