Latest / Balance of Power / Utah Governor Spencer Cox Talks Meta Settlement

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Utah Governor Spencer Cox Talks Meta Settlement · Balance of Power

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  Speaker 1: Bloomberg Audio Studios. Podcasts, radio, news.
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  Speaker 2: As we turn back to the big news out of
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  Speaker 2: Silicon Valley tonight, Meta reaching a huge settlement worth up
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  Speaker 2: to roughly $ 18 billion, including fees in a landmark case
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  Speaker 2: brought by states that accused the company of designing Facebook
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  Speaker 2: and Instagram to intentionally hook young users. The agreement requires
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  Speaker 2: Meta to make major changes to how its platforms operate
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  Speaker 2: for children and teens of We spoke to Utah Governor
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  Speaker 2: Spencer Cox about the settlement a short time ago. We
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  Speaker 2: want to start, of course, with this META settlement, which
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  Speaker 2: is a big deal for our audience. It's a big
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  Speaker 2: deal for parents and families and a big deal for investors, Governor.
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  Speaker 2: Up to $ 18 billion is the headline. We had to
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  Speaker 2: note META pulled revenue of more than $ 60 billion in
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  Speaker 2: the last quarter. And there's been a thought in some
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  Speaker 2: quarters today that this is a rounding error, essentially, for
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  Speaker 2: a massive company. Did META get off easy?
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  Speaker 3: Well, in some ways, yes. And in other ways, no. Look,
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  Speaker 3: I was one of the lone kind of dissenters when
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  Speaker 3: it came to the number. I thought the number should
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  Speaker 3: have been much, much higher. But what we got on
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  Speaker 3: the other end was something that we probably could not
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  Speaker 3: have gotten as much of in court.
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  Speaker 1: And that is the equitable relief.
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  Speaker 3: That is making sure that now they have to create
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  Speaker 3: these kids' accounts, that they put parents back in charge.
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  Speaker 3: that we're changing the algorithm, that we're turning these things,
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  Speaker 3: these platforms off at night, that we're having healthy pauses
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  Speaker 3: in there. These were all really important things that we've
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  Speaker 3: been pushing for. Utah was the first state to try
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  Speaker 3: to hold these companies accountable three, four years ago.
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  Speaker 1: And I'm really proud that we got that far.
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  Speaker 4: So, Governor, would you say this is more about the
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  Speaker 4: message that this sends more so than the money? And
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  Speaker 4: if you could drill in a little bit more on
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  Speaker 4: the money, how does Utah plan to allocate this? I
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  Speaker 4: know you mentioned one example there, but what else are
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  Speaker 4: you looking for? Yeah, yeah.
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  Speaker 3: So I want to say it's not not the message
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  Speaker 3: as much as we got actual changes to the platforms.
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  Speaker 1: And that that piece is really important. That piece matters.
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  Speaker 3: This is going to protect kids going forward. By the way,
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  Speaker 3: your kids should not be on these platforms at all.
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  Speaker 3: So so get them off. But if they are on,
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  Speaker 3: this is going to make them safer. We want to
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  Speaker 3: use the money to mitigate the harms that have been caused.
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  Speaker 1: Look, Meta knew. These guys, they knew what they were doing.
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  Speaker 3: They had their own research that showed that this was
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  Speaker 3: causing significant harm, increases in suicide ideation. increases in self-harm,
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  Speaker 3: anxiety and depression, especially with young women. And they buried
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  Speaker 3: that research and moved forward anyway. So we need to
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  Speaker 3: use this money to help, again, mitigate those harms, to
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  Speaker 3: help kids who are struggling. And it's not enough to
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  Speaker 3: just get off social media. It's what do we do next?
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  Speaker 3: We need to provide more opportunities for kids in the
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  Speaker 3: real world to get outside, to enjoy each other, to
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  Speaker 3: enjoy the real world again.
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  Speaker 1: And that's what we're going to use the money for.
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  Speaker 2: Well, as a father of a 19-year-old, I'm breathing fresh
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  Speaker 2: air just hearing you say that, Governor.
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  Speaker 1: So tell us how this works.
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  Speaker 2: These new guardrails are important. How do you enforce restrictions,
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  Speaker 2: for instance, on how much time kids can scroll when
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  Speaker 2: they're more clever than we are about getting around some
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  Speaker 2: of these parameters, parental controls, using other devices or other logins?
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  Speaker 2: I'm sure you thought this through.
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  Speaker 3: Yeah, look, there's no foolproof way to do this. We
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  Speaker 3: know that the kids are very smart, but this is
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  Speaker 3: huge because it requires the company for the first time
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  Speaker 3: to actually start age gating, right? So they have to
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  Speaker 3: know how old the person is. It puts parents in charge.
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  Speaker 3: The defaults now on these platforms are going to be
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  Speaker 3: to protect our kids, right? And now parents can override
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  Speaker 3: those if they want. If they want their kid on
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  Speaker 3: at three in the morning, the parent can change that
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  Speaker 3: and make it happen. I don't pretend that we're going
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  Speaker 3: to catch every single kid in this, but it raises
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  Speaker 3: the bar significantly.
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  Speaker 1: We're suing other platforms as well. In fact, there's a
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  Speaker 1: kicker in.
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  Speaker 3: This deal that significantly raises the monetary settlement. if other
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  Speaker 3: platforms join in. And so we're going after those platforms
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  Speaker 3: as well. And if we can get everybody moving this direction,
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  Speaker 3: it's just going to help lift everyone.
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  Speaker 1: It's going to help kids.
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  Speaker 3: It's going to help parents and make our country a
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  Speaker 3: better place.
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  Speaker 4: So that's actually what I was going to ask next, Governor,
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  Speaker 4: because Meta is calling on those other platforms, their peers,
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  Speaker 4: including TikTok and YouTube, to conform with this settlement, saying
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  Speaker 4: that it's not really going to work unless everybody gets
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  Speaker 4: on board. So what happens next? And does this really
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  Speaker 4: have teeth if those other platforms don't abide as well?
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  Speaker 3: Well, I mean, look, it certainly has teeth with Facebook
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  Speaker 3: and Instagram and the companies that are owned by Meta.
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  Speaker 3: Meta didn't settle this out of the goodness of their hearts.
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  Speaker 3: And this is what is frustrating. Like they could have
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  Speaker 3: done this three years ago. They could have done this
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  Speaker 3: 10 years ago. They could have not killed our kids
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  Speaker 3: in the beginning.
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  Speaker 1: That would be great. But they did. And so here
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  Speaker 1: we are.
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  Speaker 3: What this does is the reason they were settling is
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  Speaker 3: because they were losing badly.
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  Speaker 1: In these court cases. I mean, in New Mexico, they
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  Speaker 1: got rolled in a big way.
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  Speaker 3: I was actually excited for the case to move forward
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  Speaker 3: this fall in Utah, and they knew they were losing.
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  Speaker 3: There were four other cases that were just starting moving
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  Speaker 3: forward in Tennessee, California, other places. And they knew they
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  Speaker 3: were in trouble. They had the whistleblowers. The harms are
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  Speaker 3: so clear. And these other companies are feeling that, too.
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  Speaker 3: They know that the court cases weren't going well. They
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  Speaker 3: don't want to get on the stand and have to
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  Speaker 3: testify about how much harm.
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  Speaker 1: They've done to kids.
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  Speaker 3: So I think, I hope that this will be a
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  Speaker 3: driver to get everyone to the table. We passed bills
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  Speaker 3: requiring this kind of stuff years ago.
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  Speaker 1: They sued us.
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  Speaker 3: To prevent that from happening, we're still litigating those. The
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  Speaker 3: companies don't want this bad PR. And hopefully, you know,
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  Speaker 3: this will be a positive for Meta as people see
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  Speaker 3: that they can actually do something and that they actually
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  Speaker 3: care about kids instead of pretending to care about kids.
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  Speaker 2: Well, and they missed a lot of bad PR potentially
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  Speaker 2: in not having Mark Zuckerberg testify in this case based
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  Speaker 2: on this settlement. Governor, I'd like to ask you about
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  Speaker 2: the issue of data center because it ties into everything
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  Speaker 2: that we're talking about here eventually. And while you are
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  Speaker 2: out ahead when it comes to clamping down on sites
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  Speaker 2: like Facebook and Instagram, you are also ahead now. in
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  Speaker 2: the race to house data centers in your state. We
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  Speaker 2: talked about some of the projects last time you were
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  Speaker 2: with us, and you've brought forth a number of ideas
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  Speaker 2: about alternative energy to power them. Now that this has
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  Speaker 2: become such a visceral campaign issue, are you surprised to
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  Speaker 2: see this splitting both ways with Democrats and Republicans looking
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  Speaker 2: to control data centers? And are you looking for new
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  Speaker 2: rules of the road in Utah?
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  Speaker 1: Yeah, you're right. I mean, this has been fascinating.
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  Speaker 3: I mean, it's been a long time since we've seen
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  Speaker 3: kind of a backlash to something this big. I do
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  Speaker 3: think it goes back to social media in some ways. Look,
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  Speaker 3: data centers, there's a lot of misinformation about data centers.
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  Speaker 3: I'm pretty neutral on data centers, not a huge fan,
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  Speaker 3: but they are important.
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  Speaker 1: They're important to our modern world in very big ways.
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  Speaker 3: But I do think that they are the physical embodiment
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  Speaker 3: of people's concerns about big technology and AI.
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  Speaker 1: And look, I hope one of.
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  Speaker 3: The lessons that those AI companies out there are learning
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  Speaker 3: today is that they should think of kids on the
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  Speaker 3: front end. It shouldn't take us 10 years, 15 years
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  Speaker 3: to understand the harms and actually hold companies accountable. And
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  Speaker 3: that they'll make good decisions up front right now. When
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  Speaker 3: it comes to new rules for data center, yes. I mean,
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  Speaker 3: like everywhere else, I issued an executive order several months
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  Speaker 3: ago to put new restrictions around data centers.
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  Speaker 1: Utah has actually been really out in front of this.
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  Speaker 3: I know the nuance is kind of lost, but we
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  Speaker 3: passed some bills last session around water use and disclosing
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  Speaker 3: water use. Companies are using the best technology now, closed-loop systems,
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  Speaker 3: all of those things. You have to bring your own
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  Speaker 3: power in Utah. We were the first state to do that,
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  Speaker 3: so we're not raising rates for consumers. So but we
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  Speaker 3: are working on a new bill to try to put
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  Speaker 3: some more parameters around that.
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  Speaker 1: Interesting.
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  Speaker 2: You know, we talked to Senator Ted Cruz yesterday just
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  Speaker 2: quickly realizing that he's coming at this from a different
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  Speaker 2: state and a different body of government. He says hyperscalers
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  Speaker 2: ought to just start paying electric bills.
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  Speaker 1: Guess what?
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  Speaker 2: We want to put a data center in your community
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  Speaker 2: and you'll never have to pay an electric utility bill again.
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  Speaker 2: Is that the kind of thing that might work?
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  Speaker 3: Yeah, look, I've been very critical of the hyperscalers for
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  Speaker 3: not getting out in front of this. I mean, you know,
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  Speaker 3: these are some of the wealthiest companies in the history
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  Speaker 3: of the world with trillion dollar market caps who are
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  Speaker 3: trying to nickel and dime communities that that should not
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  Speaker 3: be happening. They absolutely should come in and let people know.
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  Speaker 3: the benefits that can come from this. Build new schools,
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  Speaker 3: lower people's taxes, lower people's electricity bills, and don't destroy
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  Speaker 3: the environment. All of those things are very possible, but
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  Speaker 3: they have to bear that responsibility. It's not up to
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  Speaker 3: the politicians to do that. I'm not here to defend them.
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  Speaker 3: People are right to be upset. People are angry. I
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  Speaker 3: totally get that. I think Senator Cruz is right. Communities
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  Speaker 3: should get to decide. There are going to be real
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  Speaker 3: winners and losers in this data center battle. And some
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  Speaker 3: communities who are interested in data centers coming and the
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  Speaker 3: data centers, the hyperscalers are willing to participate and give
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  Speaker 3: back to the community, they're going to really benefit from this.
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  Speaker 4: But in some ways, also, we have seen some of
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  Speaker 4: these hyperscalers work with governments, such as in Texas, for example.
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  Speaker 4: We saw a lot of the major players like Meta
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  Speaker 4: sign on to the governor, Abbott, his guardrails that he's
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  Speaker 4: ruled out there. Can you just give us any insight
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  Speaker 4: into what it looks like to work with these companies
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  Speaker 4: moving forward? And if you have plans to engage with them,
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  Speaker 4: particularly when it does come to this issue and the
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  Speaker 4: argument you're making that they have to bear.
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  Speaker 1: The brunt of this?
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  Speaker 3: Yeah.
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  Speaker 1: Yeah.
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  Speaker 3: Well, again, Texas put a moratorium and the governor of
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  Speaker 3: Texas put a moratorium on on any data center building.
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  Speaker 1: And so, again, a red.
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  Speaker 3: State you've seen you've seen blue states doing the same thing.
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  Speaker 3: And we just haven't seen that type of a response
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  Speaker 3: to a technology in some time. And look, those are
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  Speaker 3: similar conversations. I've been very blunt with everybody I've been
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  Speaker 3: able to talk to in this space to tell them like, hey, guys,
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  Speaker 3: you're just not going to be able to build anywhere
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  Speaker 3: unless you stop being a little less selfish and actually
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  Speaker 3: go out and help people understand that there is a benefit.
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  Speaker 3: And if there's not a benefit, then it's just not
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  Speaker 3: going to happen.