Press Release

Congress Should Investigate Federal Trade Commission’s Failure to Fix Facebook

It’s time to move money from the slothful FTC to state enforcers willing to stand up to concentrated power.

Washington, D.C. — The rumored settlement with Facebook represents the continuation of a failed strategy by the Federal Trade Commission and its leadership. Any settlement with Facebook should accomplishment two main goals. One, Facebook must be forced to admit wrongdoing. Two, the market structure of social networking and social network advertising must be restructured to eliminate the incentive for Facebook to collect personal data. The rumored settlement does neither.

Enforcers from around the world, from Germany to Washington, DC Attorney General Karl Racine, are taking meaningful action. It’s time for Congress to investigate why the FTC has not. All relevant congressional committees should begin a systematic examination of investigations and settlement practices at the FTC. In the meantime, the FTC’s budget should be cut to match the scale of its sloth, and that money moved to state enforcers like Racine and New York Attorney General Letitia James, who have taken action to protect Americans.

When FTC Chairman Joe Simons spoke to the Senate as a nominee in 2018, he expressed willingness to address the perception of lax enforcement by the commission. He has not lived up to this pledge. The current dangerous power structure in online communications and news markets is a direct result of the FTC’s failure to enforce the law.

In 1933, Congress cut $100,000 from the FTC’s budget because of the Commission’s unwillingness to stand up to monopoly. Congress regained confidence in the FTC only after the commission began to do its job of policing America’s markets.

“The FTC has failed time and again to use its power to protect the interest of American citizens,” said Open Markets Fellow Matt Stoller. “An institution which does not meaningfully use its authority to uphold the law, protect democracy, and serve the public interest should not receive public money. Taxpayer dollars can be better used to support state attorneys general and other enforcers willing to do their job.”