21 March 2018

The problem with ‘public ownership’ of Facebook


The latest bright idea from Paul Mason is that Facebook must be regulated or changed in some manner to make damn sure it does what Paul Mason wants Facebook to be doing.

There are lots of problems with the Corbynista columnist’s idea. They include: not understanding how the internet or corporate law works; ignoring how innovation happens; and the political problem of allowing the government to control a social network, real or digital.

That’s not to mention the broader point that the people best placed to control Facebook are the 2 billion users of Facebook, who can choose to use the service or not. But such free-market liberalism isn’t quite the fashion de nos jours, is it?

Let’s start with the question of ownership. That Facebook is a public, listed, company therefore owned by the public seems to escape Mason. Perhaps by public ownership he means government ownership. But that is something he rules out.

Heavy state regulation of Facebook would be to repeat the mistakes of the 20th century, when governments really did try to control the social milieu. As Anne Applebaum points out in Iron Curtain, the first thing every Soviet imposed government in Eastern Europe did was to make sure that all corners of society were state controlled. The local equivalents of the Womens’ Institute, the chess and jazz clubs, swimming teams and simply every expression of civil society were brought under the control of the state and Party bureaucracy. People were actually sent to jail for continuing to run Scout troops.

Mason, along with far too much of the British Left, is pretty relaxed about repeating Soviet mistakes, but there’s no reason why the rest of us have to go along with it. That rather covers the regulation and ownership aspects. As to breaking the company up we find more in his thread of tweets on the subject.

He points to the UK corporate registration as proof that we can control the local bit, or break if off from the whole. Such a conclusion is hard to square with the complaint about the Facebook profits HMRC struggles to tax. The reason Facebook doesn’t pay UK corporation tax on all the money collected from the UK is that the UK company just does some engineering bits, and doesn’t actually run the service. That engineering could be done from elsewhere just as the ad sales are. And the design. And there’s absolutely no one at all who has insisted that there must be a UK company out there before signing up for the service, is there?

We then come to what is arguably Mason’s silliest claim: “Next comes the fuckwittery about ‘we don’t want the state owning our data’. Me too. Hence I proposed a public owned digital ID service.

There might be some manner in which “public owned” and “state” are different but I’m absolutely certain that this wouldn’t be the case in modern Britain. As even Gordon Brown ended up agreeing when he revealed that the BBC licence fee was indeed just another tax all along.

But there is a deeper reason why we don’t want the British state to have anything to do with the likes of Facebook. The state never does innovate. Even if we accept Mariana Mazzucato’s points about invention — which we shouldn’t — it was still Apple which made the iPhone. There was no state involvement in the creation of MySpace, Twitter or Facebook. There never is in people using extant inventions to do something new and whizzy, that very definition of innovation. Therefore we just don’t want the state running things in those areas of innovation, do we? For if it did it would never happen.

That, in short, is why we don’t want the British state anywhere near something like social media or any other fast changing technology business. The moment decisions are taken on the sort of societal grounds that Mason admires and insists upon then technological advance will grind to a halt.

Facebook should be and is subject to all the same sorts of rules as any other business in the country. That is the proper role of government: to set general rules which must be obeyed by all and then we all get to see what happens. If Facebook did indeed break the law then they should of course be held responsible.

But the mere fact that someone is successful within those rules isn’t an argument to nationalise or regulate them further and that, when it comes down to it, is the only real argument Mason is employing. For there’s no one quite as jealous as a statist discovering that an organisation other than the state has a meaningful amount of power.

Tim Worstall works at the Adam Smith Institute and Continental Telegraph.