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Facebook Is a New Form of Power

Yes, it's more powerful than most companies. But it's not quite like a government, either.

Saul Loeb/AFP/Getty Images

Typically for Silicon Valley, Facebook’s June announcement of plans to launch a global, digital currency—Libra—spoke of empowering billions of people, especially those without access to banking. Also typically, skeptics were quick to ask whether anyone should actually trust the behemoth with such a tool. France’s finance minister raised concerns about privacy, money-laundering and terrorist use, and U.S. lawmakers called on Facebook to cease all development of Libra. At hearings last week, Republican Congressman Kevin McCarthy criticized the centralized nature of the planned Libra currency as compared to Bitcoin.

In particular, launching a currency strengthens an analogy many have found troubling in the past: Facebook as a government, rather than a company. Facebook’s size alone makes it unlike any other corporation on earth. Its decisions over what algorithm to use, what content to allow on the platform, and how to use the data it collects about its users, give it more influence over our daily lives and behavior than any other privately owned institution. Its carelessness can lead to national elections being swayed, or ethnic violence breaking out. Add to that the idea of Facebook having its own currency (a defining feature of states) and Facebook truly does start to sound like a government—a thought haunting House hearings last week. “Tell me how Libra will not undermine sovereign currencies and central banks, or is the very point to undermine central bankers and to provide a greater freedom away from central banking?” Republican Representative Andy Barr, asked Wednesday.

But while the Facebook-as-government theory captures something about the company’s power—mainly because government is our most familiar model for concentrated power—the analogy is hugely imperfect. The kind of power that Facebook is acquiring is neither that of a mere company, nor that of a government; it is creating a new paradigm of power altogether.

Strong critiques of Facebook’s power, such as Facebook co-founder Chris Hughes’s piece in the New York Times last May calling for the company to be broken up, tend to focus on Facebook’s market share as the main problem. In other words, Facebook seems to have a monopoly. Back in May, Hughes pointed out that Facebook generates 80 percent of all social media revenue, and cited Adam Smith’s warning about how monopolies can stifle competition, innovation and ultimately economic growth. But Hughes also hinted that something else is going on: “It’s not just that Facebook is a really big social network, it’s everything.”

That may be an exaggeration, but less so with the advent of a Facebook currency.  The so-called network effects of Facebook are already very powerful, not just because of its share of the market, but because of the absolute numbers of its users—2.4 billion every month. It’s already difficult for users and for businesses to opt out of Facebook. Despite its annus horribilis in 2017, the company has continued to grow its customer base, and the value of its stock has gone up. Those who stay on the platform despite misgivings about privacy and other concerns might want to think that they do so as a result of a rational calculationexchanging surveillance for convenience—but in reality, Facebook has created habits that are hard to break. The #DeleteFacebook moment didn’t last very long. Facebook has created an environment in which opting out, for many, carries too high a cost. For some, the price is in social networking, but for others in certain developing countries it has at times amounted to not being connected to the internet at all. When the company serves as such a powerful gatekeeper, the degree to which participation is voluntary becomes questionable. This is what makes people reach for the government analogy, a central power structure that we are part of, whether we want to be or not. If Facebook manages to get a large portion of its 2.4 billion users to take up the new digital currency, networking effects will only get stronger: If nearly a third of the world ends up buying and selling in Libra, the company will have become indispensable at a whole new level.

This no longer resembles the power of a company monopolizing a particular sector of the economy: Facebook is stretching into completely new territory, unrelated to its original product, with apparent plans to dominate that too. But the government analogy is not right either. Facebook is not a lawmaker, it doesn’t have the power to coerce people with violence, and is itself subject to the power of the governments of the countries in which it operates.

In a famous exchange between the French philosopher Michel Foucault, and the American linguist and political theorist Noam Chomsky, Foucault argued that it is misleading to think that the sole purveyor of political power is the government and its institutions. Instead, he proposed that political power is also exercised by “institutions that seem to have nothing in common with political power and seem independent from it, but actually are not.”   

Foucault dedicated much of his work to showing that power comes in many different forms. The government’s ultimate form of power over its citizens is coercion under the threat of physical violence, whereas other kinds of power operate in more subtle ways. One of Foucault’s examples was disciplinary training within prison, where the exercise of power over inmates is not simply through physical confinement and force, but via control of their daily schedule, constant surveillance, and the formation of new habits.

Facebook’s power over us lies more in these subtle Foucauldian modes than in its market share or government-like size. It has created new habits in us—the filling of every uncomfortable moment of boredom or social awkwardness with a mindless firing of the app, the compulsive scrolling through its news feed, the search for signs of social approval in its notifications. Facebook has also shaped the ways we can interact with one another online: We use a like button to express approval, interest, support, or enthusiasm—or can opt for one of the less dignified set of prescribed emojis. And the app alters our daily schedule and routines, not least by affecting the hours of sleep we get. That’s not to mention the surveillance and data gathering which, when projected back at us in the form of advertising and suggested content, can teach us to see ourselves differently, through the eyes of who Facebook thinks we are. If Facebook ends up mediating and monitoring our daily monetary exchanges too, who knows what other behaviors it will affect.   

Understanding the nature of Facebook’s power is important because only then does it become possible to critique it and overcome its bind. Seeing Facebook as a government doesn’t help with those goals. We can’t vote it out of office, and we can’t stage a revolution to overthrow it. Understanding Facebook as just a monopoly isn’t enough either. Even if the company’s subsidiaries, most notably Instagram and WhatsApp, were broken off the mother ship, Facebook would still be the largest social media company by a long way.

Government could, of course, stop Facebook from acquiring any more power. It could simply not allow Libra to go ahead. Some are beginning to think the government will choose to punish Facebook’s past sins in precisely this way. But it’s also important to conceptualize the type of power that Facebook is already wielding over our lives. Only then will we able to resist it.