What naughty boys and girls Facebook are

A quite wondrous complaint about Facebook from Carole Cadwalladr in The Observer here. If laws are not to Facebook’s liking then Facebook might not invest in those places where laws are not to Facebook’s liking. Isn’t that just the most horribly undemocratic thing for a private sector organisation to be doing?

Facebook has targeted politicians around the world – including the former UK chancellor, George Osborne – promising investments and incentives while seeking to pressure them into lobbying on Facebook’s behalf against data privacy legislation, an explosive new leak of internal Facebook documents has revealed.

The documents, which have been seen by the Observer and Computer Weekly, reveal a secretive global lobbying operation targeting hundreds of legislators and regulators in an attempt to procure influence across the world, including in the UK, US, Canada, India, Vietnam, Argentina, Brazil, Malaysia and all 28 states of the EU. The documents include details of how Facebook:


Threatened to withhold investment from countries unless they supported or passed Facebook-friendly laws.

The complaint betrays an interesting mindset, doesn’t it? Investment is simply something that companies do. Ought to do in fact, it’s a right that sovereign nations have that foreigners should come and spend their money. To then be regulated and taxed and to threaten to withhold said investment as a result of the regulation or tax is some horror to be protested about.

Except, of course, every economic actor responds to the incentives in front of them. Change the incentives and you’ll change the behaviour. Set corporation tax at 120% and watch as no foreigner at all ever invests in that newly poorer country. Insist that a CEO is criminally liable for a racist joke made by a social media user and you’ll limit the amount of social media CEOs willing to enter that market.

This should be obvious to all and yet that very complaint shows that the logic has completely passed by. What our laws are, how welcoming or not we are of foreign investment, is going to determine how much foreign investment there is. How could it ever be different?

It might well be true that we should - or perhaps should not - regulate social media more or less. But to whine that doing so might have implications concerning the amount of social media we then get is ludicrous.