00:00:02
silicon valley in california
00:00:04
from here companies like apple and
00:00:06
google have conquered the world but
00:00:09
their success has come at a price yeah
00:00:11
there's not much to see it's just um
00:00:14
people oh you're from los altos oh you
00:00:16
must be very wealthy well i was living
00:00:18
in los altos before it became
00:00:21
you know this very exclusive area to
00:00:23
live
00:00:24
david is a tradesman the rise of tech
00:00:26
companies has made it impossible to pay
00:00:29
rent for three years he's been living in
00:00:31
a van right next to google's campus
00:00:35
[Music]
00:00:37
i was living in a house it was a
00:00:39
two-bedroom house
00:00:41
i was paying about 2400 a month i was
00:00:44
doing okay
00:00:45
well the guy realizes he can get 5 000 a
00:00:48
month for this place right so he tells
00:00:50
me you got to go when the lease is up
00:00:52
i'm going to remodel and so people like
00:00:54
me like i've been here my whole life
00:00:57
i got nowhere to go
00:00:59
silicon valley in san francisco belong
00:01:01
to the bay area as of 2021 there are
00:01:04
around 35 000 homeless people here
00:01:07
alongside the highest density of
00:01:09
billionaires in the world and the
00:01:11
pandemic has only exacerbated that
00:01:13
inequality
00:01:15
it really precludes any possibility of
00:01:17
us having a meaningful democracy when
00:01:19
some people in our community have not
00:01:21
only their basic needs assured but every
00:01:24
conceivable object of opulence and other
00:01:26
people can't even survive i think that
00:01:28
exposes
00:01:30
that our pretense of democracy in this
00:01:32
country is something of a farce
00:01:36
facebook google amazon and apple have
00:01:38
changed the global economy
00:01:41
have they become too big in the process
00:01:44
politicians seem to want to limit the
00:01:46
company's power
00:01:50
the purpose of today's hearing is to
00:01:51
examine the dominance of amazon apple
00:01:54
facebook and google in fact tech bosses
00:01:56
have been called to testify before
00:01:58
congress
00:02:00
the tech industry is an american success
00:02:02
story the products we build to change
00:02:04
the world and improve people's lives
00:02:06
google aims to build products that
00:02:08
increase access to opportunity for
00:02:09
everyone
00:02:10
no matter where you live what you
00:02:12
believe or how much money you are
00:02:15
tech companies don't see their
00:02:17
marketplace power as a problem
00:02:20
one of the biggest problems that silicon
00:02:21
valley leaders have is that they believe
00:02:24
that because their intentions are good
00:02:26
that the outcomes will be good and that
00:02:28
it's really hard for them to imagine
00:02:29
that despite their good efforts some
00:02:32
things have gone completely down the
00:02:34
drain
00:02:37
[Music]
00:02:52
davos switzerland
00:02:54
this is where the world's most powerful
00:02:56
people gather for the world economic
00:02:57
forum in january 2019 the coronavirus
00:03:01
pandemic was still a long way off
00:03:05
a dutch historian put his finger on the
00:03:07
problem
00:03:08
1500 private jets flown in here and i
00:03:11
mean i hear people talk in the language
00:03:12
of participation and justice and
00:03:15
equality and transparency but then i
00:03:17
mean almost no one raises the real issue
00:03:19
of tax avoidance right come on we got to
00:03:21
be talking about taxes yes that's it
00:03:23
taxes taxes taxes all the rest
00:03:26
in my opinion
00:03:28
the fact is that more and more of our
00:03:30
world belongs to a few super rich people
00:03:33
one reason for that is tax avoidance
00:03:36
between 2014 and 2018 billionaire amazon
00:03:40
ceo jeff bezos paid an effective tax
00:03:43
rate of 0.98
00:03:46
compare that to the top u.s tax rate of
00:03:49
almost 40 percent
00:03:52
for economic historian adam twos the
00:03:54
problem is systemic
00:03:57
they're also drivers of inequality at
00:03:59
the top if you if you look at the income
00:04:01
distribution in american society a very
00:04:04
key element of the surge of the wealth
00:04:06
and income of the top 1
00:04:08
is not just people on wall street it's
00:04:10
the senior managerial elites and their
00:04:13
technicians in these companies who have
00:04:15
very big stock options very handsome
00:04:17
compensation and then they get bonuses
00:04:20
on top so these successful companies
00:04:23
distort and drive increasing
00:04:25
polarization in american society
00:04:29
the coronavirus has exacerbated the
00:04:31
trend
00:04:32
between 2020 and 2022 while many
00:04:35
americans were losing their jobs jeff
00:04:37
bezos's fortune grew by more than 80
00:04:40
billion dollars the standard story that
00:04:43
we've always been told about
00:04:45
the creation of wealth that is that it
00:04:48
is created at the top right by these
00:04:50
brilliant entrepreneurs and innovators
00:04:52
and then
00:04:53
that'll trickle down to the rest of us
00:04:55
right and and sure we can tax them but
00:04:58
we also got to be grateful and we
00:04:59
shouldn't attack them too much because
00:05:01
that may you know disincentivize all
00:05:02
their great work
00:05:04
what we've come to realize maybe
00:05:06
especially because of the pandemic is
00:05:07
that actually
00:05:09
it's the other way around the real
00:05:10
wealth creators that we're really
00:05:12
dependent on are the plumbers the
00:05:13
teachers the nurses the care workers you
00:05:15
name it
00:05:17
if they stop working society crumbles
00:05:21
tax avoidance has led tech companies to
00:05:24
rural areas far from the big cities
00:05:28
in remote prineville oregon facebook has
00:05:31
invested two billion dollars in a data
00:05:34
center
00:05:39
this was a very sleepy city prior to the
00:05:42
tech companies coming in
00:05:44
this is the county seat it's also the
00:05:46
oldest seat in county but
00:05:48
economically it was pretty stagnant
00:05:50
before the data companies came in
00:05:53
in 2009 facebook was lured here with the
00:05:56
promise of tax breaks
00:05:58
as of 2021 the city has lost a potential
00:06:01
130 million dollars in taxes
00:06:04
is the deal fair
00:06:06
in 2020 alone facebook generated nearly
00:06:09
30 billion dollars in profit
00:06:12
if they didn't show up here we wouldn't
00:06:14
have a lot of the infrastructure we have
00:06:16
we wouldn't have a lot of the cool
00:06:17
programs
00:06:18
that you know that they've helped out
00:06:20
with the schools we would still be that
00:06:22
small town struggling to find
00:06:24
an industry to come here
00:06:26
after the
00:06:28
the early 90s timber industry shut down
00:06:32
closing sawmills saw prineville's
00:06:34
unemployment rate rise to about 20
00:06:38
then came facebook but in 2022 the data
00:06:41
center employed only about 350 people
00:06:45
instead of taxes facebook makes
00:06:47
donations to the town for things like
00:06:50
school renovations courses in
00:06:52
programming and infrastructure
00:06:54
does that make prineville's politicians
00:06:57
susceptible to influence
00:06:59
i think
00:07:03
[Music]
00:07:05
because they know they'll get money from
00:07:07
them
00:07:08
they know they'll help support some of
00:07:09
the projects and things that the economy
00:07:11
itself can't afford to do
00:07:13
they're more powerful than the
00:07:14
government i mean they really are
00:07:17
and
00:07:18
i don't know where
00:07:20
or how
00:07:22
from a legislative point of view you can
00:07:26
interact
00:07:27
with something that you can't anticipate
00:07:30
and that's a problem
00:07:33
facebook is opening its 11th data center
00:07:35
on the site in 2023
00:07:38
the facility will soon have an area of 4
00:07:41
million square meters
00:07:43
the company confirms that it has given
00:07:45
out three million dollars in voluntary
00:07:47
grants
00:07:48
yes facebook has a huge presence here
00:07:51
and yes a lot of people work work up
00:07:53
there but i don't think
00:07:55
uh i
00:07:56
guess we're a facebook city and the fact
00:07:58
that we're one of their partners
00:08:00
and we've worked closely with them to
00:08:02
build
00:08:04
uh like they have but i think our
00:08:05
identity still is a timber
00:08:07
a timber town
00:08:11
facebook's tax break in prineville won't
00:08:13
end until 2027
00:08:16
only then will the town find out whether
00:08:18
its deal with the company was a good one
00:08:21
it isn't just small towns that have to
00:08:23
negotiate with tech giants
00:08:25
entire countries depend on them
00:08:28
how did individual companies get so big
00:08:33
one answer takes us back to 2007
00:08:36
the start of the financial crisis and
00:08:39
the soaring fortunes of financial
00:08:41
services firm blackrock
00:08:43
as the banking sector faltered then
00:08:46
federal reserve chair timothy geithner
00:08:48
allowed blackrock to oversee the winding
00:08:50
down and restructuring of banks so come
00:08:54
the financial crisis you have to for
00:08:56
instance rapidly dismantle a bank like
00:08:58
bear stearns who do you ask to do it for
00:09:00
you well you don't really want expertise
00:09:03
in the federal reserve of new york to
00:09:05
have its hands too dirty you'd rather
00:09:07
contract this out and you find people
00:09:09
who really know their way around this
00:09:10
like blackrock for instance at the time
00:09:12
a relatively unknown company but with
00:09:14
huge expertise
00:09:18
blackrock closed banks and bought up
00:09:20
ailing financial institutions
00:09:23
it became the first big winner of the
00:09:25
crisis
00:09:28
by 2020 the group was managing assets
00:09:31
worth nine trillion us dollars
00:09:34
and then crucially it becomes a predator
00:09:36
so it becomes an entity that has the
00:09:39
ready cash to buy other people's assets
00:09:41
as they look for
00:09:43
capital blackrock also struck in europe
00:09:46
advising the european central bank and
00:09:48
buying up a share of major british bank
00:09:51
barclays in 2009. and blackrock uses the
00:09:54
embarrassment of barclays to
00:09:56
pounce on this portfolio and dismantle
00:09:59
it and incorporate it into blackrock's
00:10:01
business and it jumps blackrock away
00:10:03
from its major competitors at the time
00:10:05
schwab and vanguard and pushes blackrock
00:10:07
into a much bigger league so help you
00:10:09
god so help me in an effort to prop up
00:10:11
failing banks u.s presidents bush and
00:10:14
obama pumped massive amounts of cheap
00:10:16
money into the system buying stock in
00:10:19
the banks with state capital
00:10:21
if you delay acting on an economy of
00:10:24
this severity
00:10:26
then you
00:10:27
potentially create a negative spiral
00:10:30
that becomes much more difficult for us
00:10:33
to get out of the whole strategy in
00:10:36
early 2009
00:10:37
is to prevent the avalanche rolling
00:10:39
again that's the key right you can do
00:10:42
work creation you can do stimulus you
00:10:44
can begin to repair american society
00:10:46
with a health care program but what you
00:10:48
can only do any of that if you stop the
00:10:51
banks falling
00:10:53
the financial system didn't collapse
00:10:56
the us economy began to recover in part
00:10:59
because investment capital was so cheap
00:11:02
one man especially took clever advantage
00:11:04
of that fact jeff bezos
00:11:07
economics professor scott galloway has
00:11:10
analyzed the rise of amazon
00:11:12
people forget in the early 2000s a lot
00:11:16
of smart analysts thought that amazon
00:11:18
was going to face liquidity crisis and
00:11:20
could go out of business and their stock
00:11:22
underperformed for the better part
00:11:24
of a decade
00:11:26
bezos focused on spending revenue and
00:11:29
easily gotten capital on the
00:11:30
optimization of a supply chain
00:11:34
the goal was to make products reach the
00:11:36
customer faster
00:11:40
it's easy to put up a website but it's
00:11:42
hard to make it really good and it's
00:11:44
hard to make sure that the stuff arrives
00:11:46
in good condition on time what's unusual
00:11:48
about amazon it's not a victory of
00:11:49
marketing it's not a victory
00:11:51
of innovation really it's a victory of
00:11:54
supply chain they have managed to get
00:11:56
more products to more people faster than
00:11:58
anyone else in the world
00:12:00
amazon is one of the most valuable
00:12:02
companies in the world along with apple
00:12:04
google and facebook as of september 2021
00:12:08
they're worth together around seven
00:12:09
trillion dollars if you show up with
00:12:11
more capital than your competitors the
00:12:14
odds are you're going to win so access
00:12:15
to cheap capital is important and has
00:12:17
become a key strategy for the winners
00:12:21
at amazon growth is everything employees
00:12:24
are monitored forming a union is
00:12:26
difficult there are two million amazon
00:12:29
retailers that depend on the giant for
00:12:32
their survival
00:12:33
much like yerghu baka
00:12:50
amazon takes care of storage shipping
00:12:53
and returns for year baka in return it
00:12:56
takes commission
00:12:58
for every euro of sales hoobacher has to
00:13:00
hand over 30 cents to amazon
00:13:03
in 2019 amazon made almost 60 billion
00:13:07
dollars from these commissions alone
00:13:11
problem is people will say well it's a
00:13:13
two-sided trade the retailers don't have
00:13:15
to work with amazon and i would agree
00:13:17
that's not really true amazon is now 50
00:13:19
of all e-commerce
00:13:21
so to not be on amazon is really to not
00:13:23
have an e-commerce offering and that
00:13:25
just isn't an option for most people
00:13:28
germany's online trade association has
00:13:30
surveyed almost 1 000 retailers about
00:13:33
their experience with amazon
00:13:36
nearly 80 percent of respondents saw
00:13:38
amazon as a difficult partner that
00:13:40
dictated prices and encouraged
00:13:42
dependency on the platform
00:13:45
in may 2021 amazon cut hubocker's
00:13:48
inventory half of his products were
00:13:50
removed resulting in a six-figure loss
00:13:53
in turnover
00:13:55
[Music]
00:13:58
you don't sleep very well when suddenly
00:13:59
the foundation of your business is taken
00:14:01
away and you have to put all of your
00:14:03
employees on reduced hours overnight
00:14:05
with no notice
00:14:08
that's not something you can prepare for
00:14:10
the switch gets flipped and then
00:14:12
suddenly you're virtually out of
00:14:13
business
00:14:16
responding to an inquiry amazon gave the
00:14:19
pandemic as the reason for its actions
00:14:21
warehouses were overcrowded and hygiene
00:14:24
measures had changed its logistics
00:14:26
procedures
00:14:28
if these inventory caps go on for
00:14:29
another two months i'll have to close
00:14:31
down
00:14:32
i wouldn't survive because the overhead
00:14:34
costs keep running
00:14:36
i have 35 employees here whom i have to
00:14:38
pay
00:14:40
amazon didn't pay compensation hubacher
00:14:43
had to bear the loss in turnover on his
00:14:45
own
00:14:46
meanwhile amazon founder jeff bezos was
00:14:49
flying into space in his own rocket
00:14:58
[Music]
00:14:59
the market power of big tech firms also
00:15:01
stems from buying up other companies
00:15:04
both inside and outside their own sector
00:15:07
they purchase hundreds of competitors
00:15:10
then they either use the newly acquired
00:15:12
technology or bury it
00:15:14
[Music]
00:15:16
apple park in silicon valley the
00:15:18
headquarters of another tech giant
00:15:22
apple was founded in 1976 with starting
00:15:25
capital of just 1 300 us dollars
00:15:29
in 2022 it's the most valuable company
00:15:33
in the world with a stock market value
00:15:35
of around 3 trillion dollars
00:15:38
much of its profit coming from the app
00:15:40
store
00:15:41
[Music]
00:15:44
founder steve jobs presented it in 2008
00:15:47
as a platform for selling software
00:15:53
[Music]
00:15:54
apple has sold nearly 2 billion iphones
00:15:57
worldwide the success of software can
00:16:00
depend on its presence in the app store
00:16:02
for which apple charges 15 to 30 percent
00:16:05
of revenue
00:16:08
david heinemeyer hanson can't accept
00:16:11
that
00:16:12
the entrepreneur lives in malibu
00:16:14
california he became famous in tech
00:16:16
circles with his base camp software
00:16:20
and essentially tell us if you don't
00:16:22
like the deal
00:16:23
you can just get out of here you can
00:16:24
just shut down your business how is that
00:16:26
a choice is it just felt like mafia
00:16:29
tactics even the way they showed up to
00:16:31
demand the money was just despicable
00:16:35
heinemeier hanson wanted to distribute
00:16:37
his new email software without paying
00:16:40
huge commissions
00:16:43
and pretty soon it's 30 of the whole
00:16:45
economy and pretty soon like why is it
00:16:47
30 not 40 maybe we should just raise our
00:16:50
prices this is a captive audience
00:16:52
nonetheless which is exactly the essence
00:16:54
of monopoly power
00:16:56
other companies are also taking action
00:16:58
against apple's commission in 2019
00:17:01
spotify sued in europe prompting the
00:17:03
european commission to initiate
00:17:05
anti-trust proceedings
00:17:08
in the u.s game developer epic games
00:17:10
also filed an antitrust complaint in
00:17:13
2020
00:17:15
apple's ceo tim cook had to defend
00:17:17
himself in court
00:17:19
this isn't about destroying apple
00:17:21
this isn't about destroying anyone this
00:17:23
is about giving us all a chance
00:17:26
and access to the market
00:17:29
the tech companies decide under what
00:17:31
conditions others can enter their system
00:17:34
in the process they collect oceans of
00:17:36
data
00:17:37
facebook holding company meta alone has
00:17:40
a total of 3 billion users thanks to its
00:17:43
acquisitions of whatsapp and instagram
00:17:47
shoshana zuboff an author and professor
00:17:50
emerita at harvard calls it surveillance
00:17:53
capitalism they
00:17:55
invade our private lives
00:17:57
through surveillance
00:17:59
they
00:18:00
extract from our lives
00:18:03
rendering what they extract as
00:18:05
behavioral data
00:18:07
and then they claim those behavioral
00:18:09
data as their private property
00:18:13
that's how surveillance capitalism works
00:18:16
this is a fundamentally illegitimate
00:18:18
operation
00:18:19
[Music]
00:18:21
the data is used to advertise products
00:18:24
and for political campaigns
00:18:28
surveillance capitalism became the
00:18:30
dominant economic paradigm
00:18:33
and it went from google to facebook from
00:18:36
facebook it became the default option in
00:18:38
the tech sector it reset the bar for
00:18:41
investors because with the surveillance
00:18:44
dividend you produce more revenue more
00:18:46
quickly than you know doing capitalism
00:18:50
the old-fashioned way which is actually
00:18:52
creating products and service that meet
00:18:54
people's real needs
00:18:56
maritia from the netherlands is a former
00:18:59
member of the european parliament
00:19:01
she's now international policy director
00:19:04
of stanford university's cyber policy
00:19:06
center
00:19:07
my sense is that one of the biggest
00:19:09
problems that silicon valley leaders
00:19:11
have is that they believe that because
00:19:13
their intentions are good that the
00:19:15
outcomes will be good and that is really
00:19:17
hard for them to imagine that despite
00:19:19
their good efforts some things have gone
00:19:22
completely down the drain shaka and
00:19:25
zuboff are part of a panel of experts
00:19:27
that want to keep an eye on facebook
00:19:30
meanwhile activists have placed body
00:19:32
bags outside facebook's washington
00:19:34
office
00:19:35
they see the company's role in election
00:19:38
interference and misinformation as
00:19:40
deadly especially during the pandemic
00:19:42
[Music]
00:19:44
even if you may think well selling ads
00:19:46
is not you know life-threatening it can
00:19:49
lead to dynamics that are
00:19:51
life-threatening with micro-targeting
00:19:53
with the going viral of hatred with
00:19:55
people taking to the streets because
00:19:58
they actually believe that the election
00:19:59
was stolen
00:20:00
[Music]
00:20:03
if you design the architecture for data
00:20:06
and information with profit goals that
00:20:08
those become dominant and that have been
00:20:10
out of sight even if society pays the
00:20:13
price
00:20:14
facebook founder mark zuckerberg has
00:20:16
testified before investigative
00:20:18
committees several times like here in
00:20:20
the us senate in 2018 my top priority
00:20:24
has always been our social mission of
00:20:27
connecting people building community and
00:20:29
bringing the world closer together the
00:20:31
us government has been pursuing several
00:20:33
cases against the tech giants in the
00:20:36
early 2020s
00:20:39
the federal trade commission is suing
00:20:41
facebook for creating a monopoly
00:20:44
the department of justice is suing
00:20:46
google
00:20:49
the house of representatives is even
00:20:51
considering breaking up the companies so
00:20:54
far without much success
00:20:56
so i think things have flipped and now
00:20:59
our innovators and our tech companies
00:21:00
believe that they in fact have the upper
00:21:02
hand and more resources and are more
00:21:04
powerful than the government that's
00:21:06
supposed to regulate them
00:21:09
are big tech corporations more powerful
00:21:12
than nations
00:21:14
for ramesh srinivasan of the university
00:21:17
of california that's a crucial question
00:21:22
who is influencing how we feel
00:21:25
what we believe
00:21:26
what we think
00:21:27
who we connect with what we know
00:21:30
right there's no question that that's
00:21:31
occurring far more uh
00:21:34
intensely and ubiquitously
00:21:37
the governance of our lives
00:21:39
by you know a private tech company a
00:21:41
google google search results facebook's
00:21:43
feeds etc right and i think the
00:21:46
awareness of the harms of putting so
00:21:49
much trust and responsibility in the
00:21:51
hands of
00:21:52
retail and
00:21:54
advertising companies was a mistake it
00:21:57
really was a big mistake and i think
00:21:59
it's important that democratic
00:22:00
governments start to
00:22:02
use technology to advance their own
00:22:04
democratic agendas and not have tech
00:22:06
companies use them to advance their own
00:22:09
corporate agendas
00:22:11
many critics are hopeful the eu will
00:22:14
curb the power of tech giants
00:22:16
two new directives from 2020 are
00:22:18
expected to get things started
00:22:21
the digital service act or dsa aims to
00:22:24
ensure that platforms like facebook and
00:22:26
twitter take on more responsibility when
00:22:29
it comes to things like deleting illegal
00:22:32
content and maintaining transparency and
00:22:35
fundamental rights
00:22:36
the digital markets act dma defines fair
00:22:40
competition rules
00:22:41
put simply allowing competition and
00:22:44
sharing data
00:22:45
amazon apple and google would be
00:22:47
affected by the directives
00:22:50
european commissioner for competition
00:22:52
magreta vestaya is taking companies to
00:22:55
task
00:22:56
with that size also comes responsibility
00:22:59
and then line up what you have to do and
00:23:02
what you cannot do
00:23:04
facebook and its fellow rivals are
00:23:06
fighting the planned regulations with
00:23:07
help from lobbyists
00:23:09
in 2020 alone u.s tech companies spent
00:23:12
around 100 million euros on political
00:23:15
influence in brussels
00:23:17
they hired ex-politicians with the best
00:23:19
connections
00:23:21
facebook even employs a former british
00:23:23
deputy prime minister nick clegg
00:23:31
there's definitely an imbalance
00:23:34
the big tech companies have a lot of
00:23:36
resources
00:23:38
as members of the european parliament we
00:23:40
have very small teams with three or four
00:23:42
employees in brussels who write policy
00:23:46
it's clear that as an individual mep you
00:23:48
can't compete with the lobbying power
00:23:50
the big tech companies have
00:23:52
or their resources
00:23:56
[Music]
00:23:58
rasmus anderson represents the greens in
00:24:00
the european parliament
00:24:02
he receives weekly requests for talks
00:24:04
from lobbyists
00:24:06
this time it's a representative from
00:24:08
amazon
00:24:09
amazon
00:24:11
amazon just wants to push its interests
00:24:15
i think they'll try to give us
00:24:16
suggestions on how to water down the law
00:24:18
so it doesn't affect them
00:24:20
or it doesn't change anything at the
00:24:21
core of their business model
00:24:26
lobbying isn't illegal but is it
00:24:28
legitimate andrea schwab represents the
00:24:31
centre-right cdu in the european
00:24:33
parliament as well as under their own
00:24:36
names large corporations exert influence
00:24:38
covertly through trade associations
00:24:42
they come to you as the first european
00:24:44
association of american companies then
00:24:47
they come as the european association of
00:24:49
digital companies then the european
00:24:51
association of tech companies then the
00:24:53
american business association and the
00:24:56
american business association for tech
00:24:58
companies
00:24:59
they come and they come and they come at
00:25:01
some point as a member of parliament you
00:25:03
have to ask how much time you can spend
00:25:05
on their concerns shouldn't we be
00:25:07
spending much more time on the concerns
00:25:08
of other citizens and businesses
00:25:12
lobbying is used to put pressure on
00:25:14
undesired regulation and if that doesn't
00:25:17
work there's a longer legal route the
00:25:20
european commission is proposing
00:25:22
creating 80 positions to enforce the
00:25:24
rules
00:25:25
but apple's legal department alone has a
00:25:28
total of 900 employees
00:25:30
of course we cannot compete when it
00:25:32
comes to the funding of lobbyism we
00:25:34
cannot compete when it comes to the
00:25:36
number of lawyers
00:25:38
so you know
00:25:39
what we have to put into the process is
00:25:41
of course a
00:25:42
a dedication
00:25:44
to get this right
00:25:47
google facebook and apple also put large
00:25:50
sums into lobbying in the us
00:25:53
when the software developer david
00:25:55
heinemeyer hansen decided to fight
00:25:58
apple's market power in 2021
00:26:00
he found out how strong that pressure is
00:26:03
in several u.s states
00:26:05
when i testified in front of the arizona
00:26:08
house and the uh
00:26:11
chairwoman of that committee said
00:26:13
as her opening statement
00:26:15
for
00:26:16
uh the proceedings that apple had bought
00:26:20
every lobbyist in town
00:26:22
and that before the hearing had even had
00:26:24
a chance to happen
00:26:26
apple had tried to squash it
00:26:27
[Music]
00:26:30
to do this the company hired lobbyist
00:26:32
kirk adams a former chief of staff to
00:26:35
arizona governor doug ducey
00:26:38
the planned law would have enabled app
00:26:40
providers to circumvent apple's high
00:26:42
commissions
00:26:44
arizona would have been the first state
00:26:46
to crack down on the monopoly
00:26:48
[Music]
00:26:50
in fact i was sitting on a zoom call for
00:26:53
that final um
00:26:55
meeting and we were waiting to deliver
00:26:57
our testimony and then in the middle of
00:26:59
the proceedings they simply said oh
00:27:01
actually we're not even going to hear
00:27:02
this bill
00:27:03
something has come up it's no longer the
00:27:05
agenda
00:27:07
and you you witness that and you think
00:27:10
is this a movie
00:27:12
there was no vote instead a deal was
00:27:15
struck behind closed doors the law that
00:27:18
would have endangered apple's market
00:27:19
power was thwarted
00:27:23
a similar regulation also failed in
00:27:25
north dakota in 2021
00:27:27
[Music]
00:27:30
so that was really just frightening to
00:27:32
see up front that
00:27:35
power as
00:27:36
being conjured by this monopoly
00:27:40
success
00:27:41
gives you the resources to squash
00:27:45
democratic accountability that when
00:27:46
sovereign states like north dakota and
00:27:49
arizona are not even powerful enough to
00:27:51
hear a bill to bring it to a final vote
00:27:55
yikes
00:27:58
when asked about what happened apple
00:28:00
admitted exerting influence but defended
00:28:02
his actions
00:28:04
saying this legislation threatens to
00:28:06
destroy this very successful model as
00:28:09
well as the privacy and security
00:28:11
mechanisms our customers expect
00:28:14
is the power of global mega-corporations
00:28:17
a danger to democracy
00:28:20
one of the steps to tyranny was when
00:28:22
private power overran government
00:28:25
government is supposed to represent our
00:28:26
best interests and be a counterbalance
00:28:28
or a ballast to private power that will
00:28:30
always pursue profits and ignore the
00:28:33
externalities whether it's teen
00:28:34
depression or misinformation
00:28:36
or
00:28:38
weaponization of our elections
00:28:40
and they're more there are more
00:28:42
full-time lobbyists working for amazon
00:28:44
living in washington d.c then there are
00:28:46
full-time us then there are sitting u.s
00:28:47
senators the
00:28:49
pr
00:28:50
and communications department of
00:28:51
facebook spinning their image is now
00:28:53
bigger than the newsroom at the
00:28:55
washington post
00:28:58
relations between silicon valley and
00:29:00
washington are close
00:29:02
we are in the middle of the worst google
00:29:04
was a top donor to barack obama's 2012
00:29:07
election campaign
00:29:10
united states corporations can
00:29:12
essentially buy elections the system is
00:29:15
corrupted so the system itself has to be
00:29:17
transformed as well on the level of who
00:29:20
influences our publicly elected
00:29:23
politicians
00:29:26
belgium
00:29:27
alibaba china's answer to amazon plans
00:29:30
to open a distribution center here in
00:29:32
november 2021
00:29:36
but the project is facing resistance
00:29:38
from some locals
00:29:44
it advocates for its interests on a
00:29:46
global scale including through companies
00:29:48
like alibaba in strategic sectors
00:29:52
we're looking at a chinese expansion
00:29:54
project here the project expansion
00:29:58
liege is a stop on the new silk road
00:30:01
china's major 21st century
00:30:03
infrastructure project
00:30:05
the deal was brokered in 2018 by
00:30:08
belgium's king philip seen here with
00:30:10
jack ma founder of alibaba
00:30:13
the closeness between state and company
00:30:15
is typical for china says digital expert
00:30:18
kai fun kanop
00:30:19
[Music]
00:30:23
it's increased significantly in the last
00:30:25
year because of the expansion of
00:30:27
so-called party cells
00:30:30
party cells are effectively communist
00:30:32
party representatives installed within
00:30:34
various private sector corporations but
00:30:36
especially in the tech sector
00:30:40
party functionaries are also working
00:30:42
within alibaba
00:30:44
profit and politics combine to serve the
00:30:47
party wallonia's former finance minister
00:30:50
doesn't see any danger in this situation
00:30:55
i don't want to be an advocate for
00:30:57
authoritarian states
00:30:59
global trade is a reality and i prefer
00:31:02
for exchange to take place between
00:31:04
democratic countries
00:31:06
but i'm not naive i don't believe we
00:31:09
live in a world where we're essentially
00:31:11
good and only good
00:31:13
that would be wonderful but it's not the
00:31:15
reality
00:31:19
is it simply online trade or chinese
00:31:21
imperialism
00:31:23
after the decline of the steel industry
00:31:25
in the 2010s liege's unemployment rate
00:31:28
was high
00:31:29
is belgium happy to pay any price for
00:31:31
economic growth
00:31:34
for 30 or 40 years we've been swindled
00:31:36
by the multinationals until now it was
00:31:39
mostly u.s companies now we're going to
00:31:41
try it with the chinese they're taking
00:31:43
advantage of the fact that we have high
00:31:45
unemployment and are desperate for
00:31:47
foreign investors
00:31:49
in 2021 two of the top 10 tech companies
00:31:53
were chinese another could soon join
00:31:55
them
00:31:56
bite dance the parent company of tick
00:31:58
tock known as do yin in chinese
00:32:02
the platform known for short videos has
00:32:04
raced ahead of the u.s competition
00:32:07
thanks to a successful recipe
00:32:11
they were able to improve the algorithm
00:32:13
based on a much better understanding of
00:32:15
our online behavior
00:32:18
china has an insanely large online
00:32:20
community and low digital privacy
00:32:23
that's led to an algorithm that's
00:32:24
significantly better at recognizing what
00:32:26
we want to
00:32:31
has only been on the worldwide market
00:32:33
since 2018 but has already been
00:32:35
downloaded over two billion times
00:32:38
more frequently than facebook and what's
00:32:40
up
00:32:41
the chinese state also has its place at
00:32:44
the helm of parent company bite dance
00:32:46
controlling data and censoring content
00:32:49
skipped catalogue
00:32:53
there's a catalog of sensitive issues
00:32:54
around domestic questions
00:32:57
tiananmen square
00:32:58
xinjiang
00:32:59
hong kong and taiwan are all sensitive
00:33:02
topics that are not allowed to be spread
00:33:03
through tick tock or the chinese
00:33:05
equivalent i skipped this
00:33:08
these policies exist in europe and the
00:33:10
us too
00:33:14
there was an example a few months ago
00:33:15
where a user tried to criticize human
00:33:17
rights violations in xinjiang under the
00:33:19
premise of a makeup video
00:33:29
how much influence does the communist
00:33:31
party have on tick tock the company
00:33:34
stresses that it complies with local
00:33:36
laws
00:33:38
but when questioned about it the chinese
00:33:40
government won't answer if it has access
00:33:42
to the data of tick tock users
00:33:49
fear is growing in beijing about the
00:33:51
power of china's own tech companies
00:33:54
in april 2021 alibaba had to pay 2.3
00:33:58
billion euros in fines after an
00:34:00
antitrust case
00:34:02
at bite dance the state has bought
00:34:04
company shares the regime has been
00:34:07
tightening the screws on the tech market
00:34:09
since late 2020
00:34:11
and is looking into banning certain
00:34:13
business models
00:34:16
i think china looks at the us and europe
00:34:18
and says these governments have been
00:34:20
overrun by big tech and we're not going
00:34:22
to get to this point and they've made
00:34:24
some very swift aggressive actions
00:34:26
against big tech saying when big tech
00:34:28
overruns government as it has in the u.s
00:34:31
and europe it leads to very bad places
00:34:36
meanwhile in nevada a company is working
00:34:39
towards doing business completely
00:34:41
independent of local laws
00:34:44
here in the desert near reno tech
00:34:46
companies are hoping to found their own
00:34:48
city
00:34:58
the model comes courtesy of
00:35:00
cryptocurrency firm blockchains llc
00:35:05
chief executive jeffrey burns wants to
00:35:08
create so-called innovation zones acting
00:35:10
like completely independent local
00:35:12
governments
00:35:16
burns donated money to nevada governor
00:35:18
steve sisilak and hired influential
00:35:21
lobbyists
00:35:22
[Music]
00:35:25
a few months after backroom talks in
00:35:28
early 2021 the governor announced a bill
00:35:31
[Music]
00:35:35
journalist sam metz has been covering
00:35:37
the story
00:35:40
so under the innovation zones as it was
00:35:42
proposed any tech company with a certain
00:35:44
amount of land that promised a certain
00:35:46
amount of investment
00:35:48
could apply with the state to create an
00:35:50
innovation zone which would give them
00:35:54
the powers akin to local government
00:35:58
the condition is that tech companies
00:36:00
invest at least 1.25 billion us dollars
00:36:04
in return they're allowed to introduce
00:36:06
their own local tax judicial and school
00:36:09
systems
00:36:10
so is sovereignty up for sale
00:36:15
i think the story of nevada is really
00:36:17
the story of politicians trying to
00:36:19
diversify a single industry economy
00:36:22
so first was mining and it was gambling
00:36:25
and tourism
00:36:26
and now i think the pandemic has really
00:36:29
made the state aware that it's hard to
00:36:30
just rely on one industry
00:36:33
the pandemic has hit nevada hard
00:36:36
the governor is hoping for a cash
00:36:38
injection from blockchain's llc
00:36:42
i think in nevada critics are worried
00:36:45
about actors with enough resources to
00:36:49
buy land
00:36:50
hire lobbyists
00:36:52
and get an audience with the governor
00:36:58
why does jeffrey burns want to eliminate
00:37:00
local governments
00:37:02
[Music]
00:37:03
our requests for an interview went
00:37:05
unanswered
00:37:07
only his security advisor was available
00:37:11
i think that we there are ways we can
00:37:13
incentivize places that have suffered a
00:37:15
lot to be investment hubs for businesses
00:37:18
but i don't think it has to mean that
00:37:20
they're given all this power to
00:37:21
basically become
00:37:23
like their own states
00:37:25
that that's a violation on many
00:37:27
different levels of sovereignty of like
00:37:30
state-based sovereignty i mean that that
00:37:33
to me sounds like some sort of like
00:37:36
district 9 or some or some sort or like
00:37:38
robocop some kind of dystopic sci-fi
00:37:42
[Music]
00:37:43
after heavy criticism the bill was
00:37:45
withdrawn in august 2021
00:37:49
governor steve sisilak and blockchain's
00:37:51
llc are holding on to their idea however
00:37:54
to sell the powers of state to tech
00:37:57
corporations
00:38:00
meanwhile in washington the fight
00:38:02
against the market dominance of google
00:38:04
apple facebook and others continues
00:38:07
congress is relying primarily on
00:38:09
antitrust laws
00:38:12
simply put
00:38:13
they have too much power this power but
00:38:16
how promising are these proceedings
00:38:18
legal expert chris sagers is skeptical
00:38:23
personally i think the the risk
00:38:25
with
00:38:27
even very aggressive antitrust
00:38:29
is not so much that it will wreck
00:38:31
anything
00:38:32
uh it's just that whatever good it does
00:38:34
won't be permanent
00:38:36
and what i fear is you know we we may
00:38:39
have this period of a few years of very
00:38:41
aggressive intervention
00:38:42
um and even though it seems unlikely you
00:38:44
know perhaps the government will manage
00:38:47
to break up google
00:38:49
or facebook or some other firm
00:38:51
and then it will only be a matter of a
00:38:53
few years
00:38:54
before somebody else figures out how to
00:38:55
make a new monopoly out of it
00:38:58
president joe biden has shown a
00:39:00
willingness for the fight but he's had
00:39:02
to compromise
00:39:04
you know democrats are in control
00:39:07
of both houses of congress and the white
00:39:09
house
00:39:10
but in the senate
00:39:13
it will be very difficult
00:39:14
to to adopt any uh legislation that
00:39:18
doesn't have some republican support and
00:39:20
republicans will be very much against
00:39:22
any very serious change
00:39:26
sages estimates that proceedings in the
00:39:28
u.s will take years
00:39:31
cyber expert maritia shaka prefers
00:39:34
action on a global scale
00:39:37
it begins with awareness about the
00:39:39
extent to which
00:39:41
the outsized power of tech companies
00:39:43
whether they're big or small the entire
00:39:45
ecosystem harms democracy it's something
00:39:48
that really has to be understood so
00:39:50
it will have to be a combination of
00:39:52
mechanisms to make sure that that
00:39:54
gets rebalanced back to putting
00:39:56
democracy first and not putting
00:39:58
technology first
00:39:59
[Music]
00:40:02
shashana zuban is calling for a ban on
00:40:04
the business model of facebook and
00:40:07
others
00:40:08
that is collecting and selling user data
00:40:12
so we take aim and extraction
00:40:14
we make those operations illegal the
00:40:17
amplification of divisive content for
00:40:19
profit the amplification of hate for
00:40:22
profit the amplification of lies for
00:40:25
profit that kills
00:40:28
we make it illegal
00:40:31
zumoff believes that the relevant laws
00:40:33
are already in place they just need to
00:40:36
be adapted to the digital age
00:40:40
we've also gone after markets
00:40:43
right and we've said um
00:40:46
we've said in democracies we've long
00:40:48
said
00:40:49
you can't trade in human beings you
00:40:52
can't trade in human organs you can't
00:40:53
trade in babies
00:40:55
you can't trade in illicit drugs
00:40:58
you can't trade in things that make
00:40:59
people sick or or products that are
00:41:01
dangerous
00:41:04
we've we've done that countless times
00:41:06
now it's just applying it
00:41:08
to our reality in our era in our time in
00:41:13
our digital century
00:41:14
[Music]
00:41:17
the uncontrolled power of mega
00:41:19
corporations and the growing gap between
00:41:21
rich and poor
00:41:24
the two go hand in hand according to
00:41:26
historian rutger brechman
00:41:31
when was capitalism working you know for
00:41:33
most people in the best way well in the
00:41:36
50s and the 60s
00:41:40
they had taxes up to 80 90 for the
00:41:42
richest people right
00:41:44
worked perfectly well you know we have
00:41:45
the highest economic growth we've ever
00:41:47
seen the highest rates of innovation
00:41:49
[Music]
00:41:55
you know for many people who are sort of
00:41:57
you know i don't know 50 years old or 60
00:41:59
years old they think oh there's
00:42:01
communism that can never work
00:42:03
um if you study history you'll see that
00:42:05
it can actually work greed for profit
00:42:07
new technology and big politics
00:42:10
together they create an opaque world one
00:42:13
which each new generation will likely
00:42:16
have to struggle to bring under control
00:42:20
jordan you made a unanimous consent
00:42:22
request objection was heard those are
