Transcripts For CSPAN3 Facebook Co-Founder Mark Zuckerberg Testifies Before House Financial... 20240713

Without objection the chair is authorized today declare a recess of the committee at any time. This hearing is entitled an examination of facebook and its impact on the Financial Services and housing sectors. I now recognize myself for five minutes to give an Opening Statement. Today, were here to examine the impact of facebook on the Financial Services and housing sectors. Our sole witness is facebooks chairman and ceo, Mark Zuckerberg. Facebooks plans to create a Digital Currency, libra, and a digital wallet raise many concerns relating to privacy, trading risk, discrimination, opportunities for diverse owned financial firms, National Security, Monetary Policy, and the stability of the Global Financial system. I and other democrats have called for a moratorium on facebooks development of this Digital Currency, libra, and digital wallet until congress can examine the issues associated with a Big Tech Company developing these Digital Products and take action. As i have examined facebooks various problems ive come to the conclusion it would be beneficial for all if facebook concentrates on addressing its many deficiencies and failures before proceeding further on the libra project. Lets review the record. First on diversity and inclusion. Facebook has utterly failed. Facebooks executive ranks and workforce continue to be mostly white and male. Since reverend Jesse Jackson and the Rainbow Push Coalition called upon Silicon Valley companies to release its diversity statistics more than five years ago, the representation of africanamericans and hispanics has increased bide 2 . Facebook told us they have 0 managed by diverse firms. Unfair housing. Facebook has been sued by the National Fair Housing Alliance for enabling advertisers to engage in discrimination on its advertising platforms. The u. S. Department of housing and urban development has also filed an official charge of discrimination against facebook for its advertising practices, including the companys own ad delivery algorithms which were found to have a discriminatory impact when advertisers did not target their audience in discriminatory ways chtd i understand that facebook has refused to cooperate with h. U. D. s fair housing investigation by refusing to provide relevant data. On competition and fairness, facebook is the subject of an antitrust investigation by the attorneys general of 47 states and the district of columbia. On protecting consumers, facebook was fined 5 billion by the federal trade commission for deceiving consumers and failing to keep their data private. On elections, facebook enabled the russian government to interfere with our election in 2016 with ads designed to pit americans against each other. Suppress the vote and boost trump. For example, facebook allowed a counterfeit black lives matter web page to operate with the goal of discouraging africanamericans from voting. Three years later, these activities are still continuing on facebook. We learned just this week that russia and iran are using the same tactics to meddle in our next election. Now on political speech. Last week, you announced that facebook would not be doing Fact Checking on political ads given anyone facebook labels a politician a platform to lie, mislead, and misinform the American People. Which will also allow facebook to sell more ads. The impact of this will be a massive Voter Suppression effort that will move at the speed of a clip. Your claim to promote freedom of speech does not ring true. 2. 7 Million People use your products, thats over a third of the worlds population. Thats huge. Thats so big its clear to me and to anyone who hears this list that perhaps you believe that youre above the law. It appears you aggressively increase the size of your company. And are willing to step on or over anyone, including your competitors, women, people of color, your own users and even our democracy to get what you want. All of these problems ive outlined and given the companys size and reach it should be clear while we have serious concerns about your plans to establish a Global Digital currency that would challenge the u. S. Dollar. In fact, you have opened up a serious discussion about whether facebook should be broken up. The chair now recognizes the Ranking Member of the committee, the gentlemen from North Carolina, mr. Mchenry for five minutes for an Opening Statement. Thank you, chairwoman waters, thank you mr. Zuckerberg for your appearance. Today is a trial on American Innovation. Theres a growing concern about the role that technology plays in our lives. Thats warranted. Thats necessary. Yes, technology has led to a greater prosperity. More freedom of expression. And the ability to transcend the limits of space and time to connect us with one another. Its a powerful tool. Powerful today for our society, developed here in the United States, gone global. But we know theres also a downside to all of this. The vitriol on social media is frightening. The going inequality between those who have access to the latest tech gadgets remain on the coasts. While folks living in Rural America are still trying to get the same connectivity necessary to compete in a global marketplace. Not to mention the anxiety of the age. Thats a deep cultural moment for us, not as politicians but as americans. That nervous feeling that you need to check your phone throughout the day. Thats something that is now a cultural occurrence for all of us, especially members of congress. Most of whom in this room are doing that right now. Theres a lot of anger out there. And now its being directed at the architects of the system. Thats why youre here, mr. Zuckerberg. Thats why youre here today. Youre one of the titans of what we call the digital age. Enormous amount of responsibility, an enormous weight based off the innovation youve wrought. Maybe its not about libra. Its not just about some housing ads, no. Maybe its not really even about facebook at all. Its that larger question. In fair or not fair, youre here today to answer for the digital age. But, of course, youre not americas first innovator and we hope youre not americas last. This is not the first time that america has faced difficult questions about technology. Sadly, throughout the history of innovation, a major theme is the exploitation of fear. Politicians enabled by special interests and a lack of understanding of new Technology Use fear to justify what is ultimately a power grab. New laws, new regulation, but ultimately old and tired ways of centralized power here in washington or other systems of government. Some of this has led in the past to comical results. We hope to avoid it now. Just as one example, there was a time when legislators pushed for what was then called red flag laws. Which required vehicles, socalled horseless carriages of that age to immediately stop on the side of the row and disassemble the automobile until equestrians or livestock was sufficiently pacified. Other times in history, the use of fear was not so funny. Our last hearing on libra, for example, was a moment when members of congress on this dias compared the technology, that technology of libra, to the terrorist attacks of september 11th. Will the gentleman yield . I have my own qualms will the gentleman yield . Time belongs to the gentleman from North Carolina. Thank you for taking the bait. Look, i have my qualms about facebook and libra. I do. And the shortcomings of big tech. There are many, yes, there are. But if history has taught us anything, its better to be on the side of American Innovation, competition and most importantly the freedom to build a Better Future for all of us. Progress is not preordained. And American Progress and american domination of free speech and global rights is not preordained. Let us not forget the wave of innovation is spreading across the world with or without us. So thats why i believe that American Innovation is on trial this day in this hearing. And the question is are we going to spend our time trying to devise ways for government planners to centralize and control as to who, when and how innovators can innovate . Or will we spend time contemplating and leading the way on the question of whether or not it will be American Innovation that leads the next century. Being led by American Values, the notion that we have of the rule of law and free speech rights and american driven jobs and innovation. Are we going to spend our time building a Brighter Future for americans or trying to tear each other apart . I yield back. Id like to welcome todays witnesses. Actually, we only have one. Mr. Mark zuckerberg. Chairman and chief executive officer of facebook. This is mr. Zuckerbergs first appearance before this committee, but i believe that mr. Zuckerberg needs no introduction. Mr. Zuckerberg, without objection, your statement will be made part of the record. Youll have five minutes to summarize your testimony. You have one minute remaining, a yellow light will appear. At that time id ask you to wrap up your testimony so we can be respectful of the Committee Members time. Mr. Zuckerberg, you are now recognized for five minutes to present your oral testimony. Thank you, chairwoman waters, Ranking Member mchenry and members of the committee. Thank you for the opportunity to testify today. As we sit here, there are more than a billion people around the world who dont have access to a bank account, but could through mobile phones if the right system existed. That includes more than 14 Million People here in the u. S. Being shut out of the Financial System has real consequences for peoples lives. Its often the most disadvantaged people who pay the highest price. People pay far too high a cost to send money home to their families abroad. The Current System is failing them. Financial industry is stagnant and there is no Digital Financial architecture to support the innovation that we need. I believe that this problem can be solved and libra can help. The idea behind libra is that sending money should be as easy and secure as sending a message. It will be a global Payment System fully backed by a reserve of cash and highly liquid assets. I believe that this is something that needs to get built. I get im not the ideal messenger for this right now. We faced a lot of issues over the past few years. Im sure there are lot of people that wish it were anyone but facebook that were helping to focus this. Theres a reason we care about this. Thats because facebook is about putting power in peoples hands. Our Services Already give people a voice to express what matters to them and to build businesses that create opportunity. Giving people control of their money is important, too. And a simple way to transfer money is empowering. Over the long term, this means more people that interact on our platforms. Thats good. Even if it doesnt, i think it could still help people everywhere. Before we move forward, there are important risks that need to be addressed. Questions about Financial Stability, fighting terrorism and more. Im here to discuss those risks and how we plan to address them. I hope we get a chance to talk about the risks of not innovating. While we debate these issues the rest of the world isnt waiting. China is waiting to launch a similar idea in the coming months. Libra will be backed by dollars and i believe it will extend americas leadership across the world. If america doesnt innovate, our Financial Leadership is not guaranteed. I actually dont know if libra is going to work. But i believe that its important to try new things. As long as were doing so responsibly. Thats what has made america successful and why our Tech Industry leads the world. We cowrote a white paper to start a conversation with regulators and government. Todays hearing is an important part of the process. What were discussing is too important for anyone to take on their own. We help tod form the Libra Association, an association of 21 companies who are working to give everyone access to financial tools. We dont control it, i want to be clear. Facebook will not be a part of launching the libra Payment System anywhere in the world, even outside the u. S. , until the u. S. Regulators approve. Last time i testified before congress, i talked about taking a broader view of our responsibility. And that includes making sure our services are used for good in preventing harm. I want to discuss that across other aspects of our work today as well. People shouldnt be discriminated against on any of our services. We have policies in place to prevent hate speech and remove harmful content. But discrimination can show up in how ads are targeted and shown to. Its part of the settlement with civil Rights Groups. We banned advertisers from using age, gender or zip codes to target housing, employment or Credit Opportunities. Its part of our commitment to prevent discrimination. I know we need more diverse perspectives in our country. Diversity leads to Better Services for our committee. Weve made diversity a priority in hiring and weve also made a commitment that within five years, more than 50 of our workforce will be women, people of color, and other underrepresented groups. Weve made some progress here. There are more people in color, women in technical and Business Leaders and underrepresented people at facebook now, but i know we still have a long way to go. Chairwoman waters, Ranking Member mchenry and members of the committee, this has been a challenging few years for facebook. I recognize that we play an Important Role in society and have unique responsibilities because of that. And i feel blessed to be in a position where we can make a difference in peoples lives. And for as long as im here, im committed to using our position to push for big ideas that i believe can help empower people. Thank you, and now im looking forward to answering your questions. Thank you very much. I now recognize myself for five minutes for questions. It is no secret that facebook allowed russia to undermine and divide our country through divisive online ads. The senates investigation discovered that africanamericans were targeted the most by russia, specifically in places where black lives matter groups were the most active. Despite all of your technicological expertise, russia and iran are at it again for the upcoming election. Last week you announced a new ad policy that gives politicians a license to lie so you can earn more money off the division i suppose. Facebook changes the rules when it can benefit itself. Last year, facebook banned all crypto currency ads on its platform because theyre frequently related to deceptive promotional practices. Seems fair. Then earlier this year, facebook rolled back the crypto currency ban for a Blockchain Company and announced its own crypto currency. Tell us what changed . How did crypto currency go from being misleading and deceptive last year and then becomes a means for Financial Inclusion this year . It seems to me that you shifted your stance because you realized you can use your size and your users data to dominate the crypto currency market. You change your policy when it benefits you. You reinstate a crypto currency ad because you had plans to start your own crypto currency. So this brings me back to your new policy on political speech. My question to you is, how does this new policy benefit you . Because it seems that a policy that allows politicians to lie, mislead, and deceive would also allow facebook to sell more ads to those politicians thus making your company more money. But you can tell me how does facebook benefit . Chairwoman, thanks for those questions. Id like to address all the things you mentioned in there. On elections, youre right that in 2016 we were on our back foot in terms of preventing russia from attempting to interfere in our elections. We spent a lot of the last few years Building Systems that are more sophisticated than any other company has at this point and frankly a lot of governments do. This monday we announced we tha proactively identified a network of fake russian accounts and a few networks of iranian fake accounts we proactively took down. Which certainly signals that these nation states are still attempting to interfere but i hope it will give us more confidence that our systems are able to identify and address these things. On your question about political ads. Look, from a business perspective, the very small percent of our business that is made up of little ads does not come anywhere close to justifying the controversy this incurs for our company. This is not about money. On principle i believe in giving people a voice. I believe ads can be an important part of voice. I think in the process for challenger candidates and local candidates whose message might not be covered by the media, having ads can be an important way to inject your message let me interrupt you for a minute. Are you telling me as you said to me before you plan on doing no Fact Checking on political ads . Chairwoman, our policy is that we do not fact check politicians speech and the reason for that is that we believe that in a democracy its important that people can see for themselves what politicians are saying. Political speech is some of the most scrutinized speech already in the world do you fact check on any ads at all . Yes. Describe what you fact check on. Well, chairwoman, actually thank you for the opportunity to clarify. Facebook itself actually does not check, it does not fact check. What we do is we have feedback that people in our community dont want to see viral hoaxes or kind of let me be clear, you do no Fact Checking on kbaany ads, is that correct . What we do is we work with a set of independent Fact Checkers somebody fact checks on ads, you contract with someone to do that, is that right . Chairwoman, yes. Tell me who is it that they fact check on . Chairwoman, what we do is when content is getting a lot of distribution and is flagged by members of our community or by our technical systems, it can go into a queue to be reviewed by a set of independent Fact Checkers. They cant fact check everything, but the things they get to and if they mark something as false all right, my time has expired and someone else will continue on this line of questioning. And i now call on the gentleman from North Carolina, the Ranking Member mr. Mchenry to be recognized for five minutes. I think there are bigger challenges and opportunities facing america than your ad model. Or even the question of libra. Lets start with your speech last week. Have you changed your view in terms of technology and china . From before your speech on friday to what we read and heard from your speech on friday . Congressman, no, ive not changed my views in the last week. No. No. Ten years ago versus today on your view of china and technology versus your speech on friday. Congressman, i think its fair to say its evolved. Probably ten years ago would have been more optimistic that trying to work in china could have contributed today making a more open society. Today, it seems that in some cases working in china, not only does not do that but compromises American Companies ability to promote our values abroad and around the world. Weve seen that in the last few weeks in a number of cases. You mentioned in your speech a decade ago ten of ten, at the Top Companies on the internet were american. Now six of ten are chinese. So the question i have for you is why are we seeing emerging technologies driven by blockchain Digital Currencies being developed elsewhere, such as the case of libra . Well, congressman, we have a lot of competition around the world. And youre right that over the last decade, pretty much all of the major internet platforms have been American Companies with strong Free Expression values. Theres no guarantee that is the state of the world going forward. Six of the Ten Companies coming out of china and do not share our values on things like expression. Why switzerland for libra, why not the United States . The Libra Association is an independent association. Were trying to set up a global system. Switzerland is where a lot of the International Organizations are. It also Greater Regulatory certainty in switzerland than here in the United States for this type of technology . I think switzerland has certainly been forward leaning on wanting to work through systems like this. But i dont want this to come across as if and the United States is not . Well, congressman, one of the things i want to be clear on is that the independent Libra Association is independent, were a part of it, we dont control it. But i just want to make sure its 100 clear to everyone today that my commitment running facebook is that were not going to launch anything thats a product or a part of this until we have full support from u. S. Regulators regardless of what the project of libra internally before you handed it over to the association. Lets think of this. Why would you have a project like that . Is it about competition with your peers globally, is that a component . Sorry, i didnt hear that. You have no payments platform on facebook. Facebook is not a payments platform . Correct. Seeking to develop a payments platform, was that because of examples globally of competitors creating payments platforms . Congressman, it was partially that. And its partially because i view the financial infrastructure in the United States as outdated. So there are two sets of work that we do on payments. One is building Payment Systems that allow people to send money on top of the existing Financial System that exists. Network is relatively less controversial. Were doing it around the world in different countries, on top of different Payment Systems. Theres another set of work, which is what were trying to do with libra. Which is trying to rethink what a modern infrastructure for the financial would be if you started it today rather than 50 years ago on a lot of outdated systems. I just look at the fact you can send a text message to someone around the world let me just drill down on this. Ali pay has 900 million users. That is a global competitor, in my view, to facebook. You see ali pay and we chat pay working. Why not just do a facebook version of ali pay in order to level this . Congressman, i think youre right that theyre certainly competing not just with us but all the American Companies with this. Part of the infrastructure theyre building on is a lot more modern than some of what wed have to build on here. As soon as we put forward the white paper around the libra project, china immediately announced a Public Private Partnership Working with Companies Like that to extend the work that they had already done with ali pay into a digital rmb as part of the belt and Road Initiative they have. Theyre planning on launching that in the next few months. Thank you. The gentle woman from new york, mrs. Maloney who is also the chair for the subcommittee on entrepreneurship is recognized for five minutes. Thank you. You said on page three of your testimony that facebook will not be part of launching libra anywhere in the world until all the u. S. Regulators approve. Which u. S. Regulators are you talking about . There are actually many financial regulators, such as the fed, the fd ooic, occ, cfpb fhfa and many, many more. To be clear, libra would affect all of those regulators. So which of those regulators do you need to approve libra before youll support the launch . What kind of approval do you believe is necessary . Do you need to see written approval from each regulator . Will those approvals be public . Congresswoman, thanks for the question. My understanding is probably all of them for Different Things. Different of these regulators focus on different areas, whether its Financial Stability or fighting crimes, fraud, terrorism, different areas need to get done and are overseen by different regulators. I think the processes with each of them might be a little bit different. But were committed to getting all of the appropriate u. S. Approvals before launching the libra Payment System in any country in the world, even where those approvals might not be strictly required. To be clear, will you commit to waiting until you get approval from every u. S. Regulator libra affect before you support launching libra, i dont know . All the regulators that have jurisdiction over what were doing were working with and will seek approval from them. A bill passed the house yesterday which would crack down on Anonymous Shell Companies in the United States, which has become a it nightmare for Law Enforcement. Theyre the perfect vehicle for laundering money and for Terrorism Financing and criminal activity. Now with the creation of various Digital Currencies, we face a new challenge with Financial Transactions being anonymous. Thats why im concerned that the use of anonymous wallets would make libra attractive to those that are looking to launder money. Its my understanding that libra wallet wont be anonymous. I havent heard anything about competing wallets. So will you commit not to supporting any other anonymous wallets or libra . I consider this a National Security issue. Congresswoman, thank you for the question. I think it build on a question that the chairwoman was asking before as well about our position on crypto currencies overall. What we we see a range of different crypto currency projects out there from completely decentralized and deregulated things to what were trying to do is trying to build a safe and secure and regulated alternative. We think that the Digital Payment space needs that. Of course, as a big company were not going to do something thats unregulated. Were going to work with the government to build something that gets to the same standard on antiMoney Laundering and cft that all of the other world class Payment Systems have or exceed those standards. Sorry, i forgot the actual question. Caught up in answering the chairwomans question. Well, i dont think you have you can have strong antiMoney Laundering controls and anonymous wallets. Right. So i see this as a new loophole for criminals looking to hide and launder money. So what is your position on anonymous wallets . Will you commit that you wont have anonymous wallets, that it be transparent . Otherwise well face the problems we have with the llcs where theyre hiding trafficking money, Terrorism Financing, criminal activity of all kinds. Its a huge problem for safety for americans. Its a huge problem for Law Enforcement. This is the number one concern, was this bill we passed yesterday with bipartisan support. But youre creating a whole new currency that could potentially be anonymous and could hide all types of criminal activity which is a huge concern for the safety of americans. And National Security. Yes, congresswoman, ill commit that facebook will do what youre saying. Our version of this, our wallet is going to have strong identity is going to work with all the regulators to make sure that we are at the standard of cft that people expect or exceed. I cant sit here and speak for the whole independent Libra Association. But you have my commitment from facebook. Thank you very much. I yield back. The gentlewoman from missouri, ms. Wagner is recognized for five minutes. Thank you, madam chairwoman. Thank you, mr. Zuckerberg for being here. When libra was announced, 28 companies joined as founding members. By signing a nonbinding letter of intent to join the association. In recent weeks many of these founding members have dropped out of the association. Perhaps theyre not so sure its going to work either. Paypal. Visa. Mastercard. Stripe. Bookings holdings, and ebay they be lost these youve lost these stable partners i would say. I find it highly concerning. Very briefly, what do you make of these sudden departures from the association . Why do a number of these founding members have concerns that whether youre up to the task of meeting the Money Laundering and regulatory standards . Thanks for the question. This project is too big for any one company to do on its own, which is why we set up this independent Libra Association with a number of other companies and nonprofits. Its very a very complex project and as you say its risky. Why have they departed . Scores of stable partners have dropped out, why . Congresswoman, i think youd have to ask them specifically why do you think they dropped out . I think because its a risky project and theres been a lot of scrutiny. Yes, its a risky project. Let me move on to something thats near and dear to my heart. As you may know i wrote and passed the fight online secox trafficking act. Im committed to rooting out online sex trafficking and believe that what is illegal offline, should indeed, be illegal online. Three weeks ago the New York Times ran a report titled the internet is overrun with images of child sex abuse. Id like to have this submitted for the record. Without objection. 16. 8 million as confirmed by the department of justice, of the 18. 4 Million Worldwide reports of child sexual abuse material are on facebook. 16. 8 of the 18. 4 million. These 18. 4 million reports from last year included a record 45 million photos and videos. These are absolutely shocking numbers. Moreover, its estimated that 70 of facebooks valuable reporting to the National Center on missing and exploited children would be lost if facebook implements its end to end encryption proposal. Mr. Zuckerberg, how much is this figure growing year after year . And if you enact end to end encryption, what will become of the children who will be harmed as a result that theyre not reporting . Congresswoman, thanks. Child exploitation is one of the most serious threats that we focus on what is facebook doing . 16. 8 of the 18. 4 million . Congresswoman, those reports come from facebook. The reason why the vast majority come from facebook is because we work harder than any other company to identify this behavior what are you doing to shut this down . These accounts pedal horrific illegal content that exploits women and children. What are you doing, mr. Zuckerberg, to shut this down . Congresswoman, we build sophi sophisticated systems 16. 9 and growing . I dont think facebook is the only place on the internet where this behavior is happening. I think the fact that the vast majority of those results from us reflects the fact we do a better job than anyone else of finding it and acting on it. And youre right that in an end to end encrypted world, one of the risk sas im worried about among others to safety is that it will be harder to find some of this behavior. Youd you want end to end encryption. Whats going to happen of these children . They wont be reported then. Youre responsible, facebook is responsible for 16. 8 million of the 18. 4 that are out there last year alone. Again, i believe there are probably a lot more than 18 million out there. Were doing a good job of finding this. But i think youre right what are you going to do to shut it down, m . Were work ing with Law Enforcement and building technical systems youre not working hard enough, sir. End to end encryption is not going to help the reporting process. Im over my time. I have many more questions that i will submit for the record. Were going to talk about this and i yield back, thank you. The gentle woman from new york is recognized for five minutes. Thank you madam chair. Facebook has pledged it will not share Financial Data or any third Party Without customer consent. However, facebook has had a history of problems safeguarding users data. In july, facebook was forced today pay a 5 billion fine to the ftc. By far the largest penalty ever imposed to a company for violating consumers privacy rights as part of the settlement related to the 2018 Cambridge Analytica scandal. Let me start off by asking you a very simple question. Why should we believe what you and libra are saying about protecting customer privacy and Financial Data . I think this is an important issue for all the services we build. I think the settlement and the order we entered into with the ftc will help us set a new standard for our industry in terms of the rigor for the Privacy Program were building. Were now basically building out a Privacy Program for data that is that is parallel to what the requirements would be for a Public Company on peoples Financial Data. In terms of audits internally, any manager who is overseeing a team that handles peoples data has to certify quarterly that theyre meeting their commitments. That goes all the way up to me, and ill have to certify that on thank you for your answer. It has been publicly reported that when you acquired whats app, facebook officials coached the companys founder to tell European Union regulators that it will be, and i quote, really difficult to merge or blend data between facebook and whats app, and that there was no desire to integrate the two systems. Mr. Zuckerberg, 18 months later, the platforms were linked. The European Union fined facebook for providing incorrect or misleading information. So let me ask you, do you understand why this record makes us concerned with facebook entering the crip yptocurrency space . Do you realize that you and facebook have a credibility issue here . Congresswoman, i understand that we have work to build trust on this. That means making commitments and even if we learn new things in the future that could change our mind on how we should operate, that i think were going to need to make sure that the commitments that we sure. Have you learned that you should not lie . Congresswoman, i would disagree with the characterization of lying. Well, you say you went to the european regulators and you said it will not link. It will not that it will be impossible. Yet, 18 months later, it happened. And you were fined for that. Congresswoman, im so lets continue. I hope that you learned something about that, about not lying. Facebook internal model was, for a long time, break things. Mr. Zuckerberg, we do not want to break the International Monetary system. Last week, the g7 released a report stating that global stable coins could have significant adverse effects, both domestically and internationally. On the transmission of Monetary Policy as well as Financial Stability. Given the g7s concerns and the concerns voiced by us here today, would you commit to a monit monitorium or launching libra onto congress to develop not the regulators. You said before you will not move until all the regulators sign into and support for you to move forward. Here, congress, the peoples house needs to have the opportunity to work on a Legal Framework so that we provide the guidance to the regulators. Would you commit to that, yes or no . Congressman congresswoman, my understanding is that congress exercises significant oversight over the regulators through these committees. So that would seem to me like the appropriate way for that to happen. So that is a no. Thank you. The gentleman from oklahoma is recognized for five minutes. Thank you, madame chairman. Mr. Zuckerberg, the problem of addressing underbanks and unbanked individuals is both real and important. A significant portion and i know the libra project is intended to reach this population however, a significant portion of the underbanked simply do not trust banks. I suspect they may not trust captains of industry or members of congress either for that matter. Do you see this as being a major hurdle in the wide adoption of libra . Congressman how do you persuade those people youre trustworthy and to use the system . Congressman, weve certainly had a lot of issues over the last few years, but i think its worth remembering that every day, billions of people come to our services because they trust that they can share content, messages, photos, comments, with the people they care about. More than 100 billion times a day, people do that. They share something with a set of people because they know that that content is just going to reach the people that they want it to. So i think that if were able to move forward with this project, there may be some people who dont want to use it because they dont trust us or dont like us, and thats one of the values of having an independent association where there will be other competitor wallets and other approaches, too. But i think that this is an area where being able to put ideas out into the world and letting the market world and, you know, letting People Choose for themselves what they trust and what services they want to use is appropriate the right approach. I just suggest that it will take a lot of energy and effort to reach that group, the underbanked, the unbanked, and it is real and growing more substantially. Lets shift focus for a moment. I also serve, along with congressman posey, on the science, space, and technology committee. Those of us who worked on that committee though, as all of us do, that the digital images can be altered to make it nearly impossible to distinguish between what is real and what is not. Facebook recently launched the deep fake detection challenge in collaboration with microsoft and others to address this problem. This seems like a step in the right direction on behalf of the Technology Companies involved. From your perspective, how great a threat is the deceptive use of deep fake technology, and what ways do you anticipation the detection challenge will be successful . Thank you, congressman. I think deep fakes are clearly one of the emerging threats that we need to get in front of and develop policy around to address. Were currently working on what the policy should be to differentiate between media that has been manipulated by a. I. Tools like deep fakes, which is intent to mislead people. Compare that to normal content that might have been you know, an interview that might have been cut differently and someone doesnt like the way it is cut, but it is not a deep fake and is not, kind of misleading, manipulated content in that way. Were working on that policy. I think this is a very important area. The deep fake challenge to technically figure out, how do i identify these things, will certainly help inform the policy. This is one of the areas i do think is important going forward. One final question. Many experts have suggested that we need to educate the public on how to consume trusted information. Facebook recently announced an initiative to support projects on media literacy. Could you elaborate on these projects and what you see as facebooks role, given your critical position within the industry . Yes, congressman. This question may be premature to ask, though later on this week we have a big announcement coming up on launching a Big Initiative around news and journalism. Were partnering with a lot of folks to build a new product thats supporting high quality journalism. I think there is an opportunity within facebook and our services to build a dedicated surface, a tab within the apps, for example, where people who real areally want to see high quality, curated news, not just social content, but from high quality publishers can go and consume the content. That could create a place where we can form new Business Partnerships to help fund high quality journalism, as well. Im looking forward to discussing that at more length in the coming days. Give back the balance of my time, madame chair. Thank you. The gentleman from new york, mr. Meeks, who is also the chair for the subcommittee on Consumer Protection and Financial Institutions is recognized for poo five minutes. Thank you, madame chair. Mr. Zuckerberg, you came in, and your Opening Statement sounded great. I think that your advisers advised you to what we wanted to hear, an interest you think members of congress on various sides wanted. But words are different than actions, sir. One of the first things i heard you say when testifying is you were interested in the unbanked and underbanked. I chair, as the chairwoman said, the Consumer Protection and Financial Institutions subcommittee. We had a hearing yesterday dealing with what we call mbdis monetary depository institutions. Facebook is a billion, trillion dollar company. Are you concerned of the underbanked and unbanked . How many of facebooks money is helping the underbanked . Have you invested in the Development Institutions in america or elsewhere in the world . Are any of your money sitting in those banks . Congressman, im not sure of the answer to that question. What i do know is a lot of the people we serve around the world are underbanked. This is beyond the u. S. , as well. I understand it is beyond the u. S. Were here right now. Youve just indicated that you want to work and you would not move any place else unless you were in compliance with the u. S. Regulators, et cetera. What im saying is, for example, i dont even know when you talk about internationally, whether or not going after the unbanked and underbanked, whether or not you tend to have calibra and your digital wallet register in each of those countries, so that there would be a Regulatory Oversight. We have found a lot of individuals we have payday lenders who say, were interested in the underbanked. Were interested in those that are not banked. And those individuals who are supposed to help pay more than anybody else. Youve got institutions here, minority depository institutions. If you want to show that youre doing the right thing, then with all of the money that you have, you can do it here in the United States and other places, also. That is an answer that you should know. I would urge you to go back and find out. I would almost guess there is zero dollars there. You should be there then look at your policy and change it. Because action speaks much louder than words. And you do have a trust factor. I mean, i met with a lot of your investors who are pulling out of libra. Lets just look at the news. The other thing thats most important to me is our democracy. Democracies around the world. Now, you tell me, when you look around the world, it seems to me that facebook was in many of the destructive politics of today. For example, 2016, russia interference with the u. S. Elections. Youve admitted that you were caught on your heels. Question is, what has been and what will be done for 2020 . Brexit. Another big issue around the world. Misinformation and divisions. Attempts at division and misinformation across north america and europe. Facebook has been systemically found at the scene of the crime. Do you think thats just a coincidence . Sir . Congressman, we operate in almost every country in the world except for china and north korea, so i think we would be in almost every country where different activities are happening. One thing that you mentioned before that i agree with is there are a lot of predatory financial organizations. We ban payday lenders and a lot of folks like that from using our platform for ads, as well. Certainly, were not interested in what im talking about, not only banning, you can put the you have the wherewithal. Because if these mdis had the money, theyd be able to pick a product because these folks need access to capital and Financial Institutions. Im out of time. Thank you. The gentleman from florida, mr. Posey, is recognized for five minutes. Thank you, madame chair, and Ranking Member mchenry for holding this very informative heari hearing. For many of us, facebook is a reality in our business and our personal lives. I communicate with my constituents as well as my friends through the platform daily. Many benefits accrue from the service, yet in the midst of these great benefits, great challenges have emerged. I want to welcome you to this hearing. Mr. Zuckerberg, i believe facebook is a Great Innovation that has much potential for g d good, that we welcomed innovation together with the controversies it spun. Unfortunately, some in politics and the media see the role as cajoling facebook to censor itseits users speech. I wrote you that i was disappointed facebook would consider interfering with free speech with vaccinations. I support vaccinations, but i support open and honest communication. Everyone should make vaccination decisions with full information. In recognition of the uncertainties, the risk of vaccinations, the federal government created a vaccination trust fund that paid out over 4 billion to compensation those who have been injured by vaccinations. There is no more clear or persuasive statement about the risk associated with vaccinations than the existence and the payment record of that fund. From time to time, medical research established a case and context of specific risks associated with vaccinations. I wrote you when another member of the house made claims that the risk of vaccinations should not exist and that facebook should police kmCommunications Related to the vaccination risk. Today, you testified you believe in giving people a voice. Mr. Zuckerberg, is facebook able to assure us that it will support users fair and open discussions and Communications Related to the risks as well as the benefits of vaccinations . Congressman, thanks for the question. We do care deeply about giving people a voice and freedom of expression. Those are some of the founding values of the company. The same time, we also hear consistently from our community that people want us to stop the spread of misinformation. So what we do is we try to focus on misinformation that has the potential to lead to physical harm or imminent harm. That can include especially Misleading Health advice. There is a hoax that was going viral a number of months back that lets stick to this subject because our time is very limited. Are you 100 confident that vaccines pose no injury to any person on this planet . Congressman, i dont think it would be possible for anyone to be 100 confident, but my understanding of the skein tici consensus is that it is important that people get their vaccines. But you said your platform, you believe in giving people a voice. Doesnt somebody shouldnt somebody have the opportunity to express an opinion different from yours . I mean, over 4 billion has been paid out by the fund. For thousands of people. Shouldnt people have information to make an informed choice . Congressman, i do. Thats why we dont stop people from posting on their page something that is wrong. If someone wants to post vacc e vaccine antivaccination content, or if they want to join a group where people are discussing the content, we dont prevent them from doing that. What we do is we dont go out of our way to make sure that our Group Recommendation systems try to show people or encourage people to join those groups. Okay. We discourage that. Okay. How do you discourage it . Well, there are a number of different tactics. For example, if someone is typing in into the search results, into the search box, something that might lead to antivax content, we dont recommend antivax searches to them. If you type in the name of a group exactly, you can get the group. Were not going to prevent you from joining it. Were not going to recommend or go out of our way to show people content that would encourage people to join those groups. People can share that content if they want. Many people harmed by this policy are, in fact, parents with disabled children. I dont think we or you should be so quick to turn our backs on them. If you look at the statistics, i think youre making a bad mistake. Time is expired. I yield back. Thank you. Thank you very much. The next gentleman from california is mr. Sherman. Today is his birthday. Happy birthday, mr. Sherman. Youre recognized for five minutes. You dont get any more just because its your birthday. Donald trump said Crypto Assets can facilitate unlawful behavior, including the drug trade. I ask unanimous consent to put in the record a report talking about cryptocurrencys use by terrorists. Hopefully without objection. Without objection, such is the order. Not here to be antifacebook. I was anticryptocurrency back when you were anticryptocurrency. Cryptocurrency either doesnt work, in which case investors lose a lot of money, or it does achieve its objectives perhaps and displaces the u. S. Dollar as the or interferes with the u. S. Dollar being the sole reserve currency or virtually the sole reserve currency in the world. That role of the u. S. Dollar saves the average American Family 1,000 in interest costs because money pours into the United States because of the role of the dollar. The Federal Reserve can turn over up to 100 billion in profits to the u. S. Treasury that we in congress spend because of the power of the u. S. Dollar. The u. S. Dollar is an excellent currency as a means of account. It serves all the needs except it is really bad for tax evaders, drug dealers, terrorists. That unmet need can be met by a new currency. If we make drug dealers just 10 more effective, how Many American deaths is that over the next decade . Does it compare to the deaths we experience from terrorism . Well have to see. But those who are introducing cryptocurrency have got to pause and wonder what effect theyll have on the power of the United States to impose sanctions. Right now, turkey is stopping at 20 miles into syria, not because of u. S. Troops were not but because of u. S. Sanctions, the role of the u. S. Dollar. We stand to lose all that because cryptocurrency is the currency of the crypto patriot. Ms. Velazquez pointed out that youre going to wait for regulators to sign off. Regulators are working with old statutes. Your lawyers are going to show that there is a loophole in a 1940 Investment Company act that gets you where you want to go. The regulators cant stop you. Youre going to call that regulatory approval, as if the people in 1940 knew what you had in mind. What youve made clear is that you will go forward unless donald trump appointed regulators stop you. And you will go forward if you can just find loopholes in statutes, but youll deploy a horde of lobbyists to prevent us from writing a new statute. Ms. Maloney asked you a question which you forgot to answer, but lets be clear, youre going to be making powerful burglary tools and letting your Business Partners commit the burglary. You are going, with all the power of facebook, to try to create a new currency. Youre going to call it the libra, but youre the person behind it. Thats why it is i call it the zuck buck. You are going to create it and say, oh, its our Business Partners. Your white paper says youre business papers. Theyre going to use your tool to have anonymous accounts. Then you have the gall to say, youll follow the know your customer. How do you know your customer with an anonymous account . Then mr. Meeks calls your bluff on this idea that youve been creating a Payment System for the poor and unbanked. The poor and unbanked need pesos, dollars, that they can buy something at a local store. Youve done no effort to help the unbanked anywhere else at any other time. And you should. You should create a Payment System with a close to zero fee. The real money is in the tax evaders and, to some extent, the drug dealers. I know youve got at least 100 lawyers that will tell you that what youre doing is legal and that you will be safe. But given the harm that this can do, they could be very wrong. And if this explodes the way it might, especially you will not be able to hide behind the idea that you didnt create the libra organization, that it is just your Business Partners that have wallets designed for drug dealers and terrorists. I i have a few more things to say, but for the richest man in the world to come here and hide behind the poorest people in the world, and say thats who youre really trying to help, youre trying to help those for whom the dollar is not a good currency, drug dealers, terrorists, tax evaders. Thank you. The gentleman from missouri is recognized for five minutes. Thank you, madame chair. Welcome, mr. Zuckerberg. I certainly admire you as an innovator and entrepreneur. Youve taken advantage of the Economic Freedom of this country. I admire that. I think thats fantastic. But you now are in front of getting into a different world here with your libra experience here. You know, in the past, youve been dealing with Communication Systems where people are being able to Exchange Everything from retail information to personal information, and it was kind of buyer beware in the retail world. In the financial world, people will transact business because they can trust that the transactions are going to be secure from the standpoint of the stability of the dollar or whatever theyre exchanging their money in. The secrecy of the activity. Theres Consumer Protections as well as, you know and not being able to do things in a illegal fashion. So that takes a lot of regulation. As youre finding out, regulation is an important part of Financial Services role to be able to give people those kinds of protections and earn that trust. So youve indicated already that you want to conform to the regulation to be able to do this and earn that trust. Can you continue to the first question is, can you continue to innovate and be able to make the changes to this product as it needs to be, to be able to conform to the regulation and still be able to make this work . Do you believe that can happen . Congressman, i currently do. I think well have to see how this process plays out, but i do, sitting here today. Are you willing to stop this project if you see that it cant go forward anymore . Congressman, i will certainly stop facebooks part of it. The independent Libra Association is a separate thing that exists at this point. If i feel facebook cant be part of it, keeping with the principles i laid out, facebook wont be a part of it. I want to followup on mr. Shermans line of questioning with the reserve currency. What effect do you think that you get implemented libra implemented, what this would have on the reserve status of the u. S. Dollar . Congressman, because the reserve will be primarily u. S. Dollars, i actually think that a project like this could be important for extending americas Financial Leadership. To the contrary of the risks that are being pointed out. We have to be careful about all of the risks around Financial Stability. Theres certain regulators who oversee that, and were also mindful of that. We want to do something that strengthens americas leadership. I think we cant sit here and assume that because america is today the leader that it will always get to be the leader if we dont innovate. Innovation means doing new things. Okay. New things have risks, and we need to address the risks. We need to be careful in doing that. I personally worry that if we dont do things like this, whether it is this project or others like it let me potentially we lose our leadership. I appreciate the fact that youre pointing out that china is already doing this. That means if were going to allow them to play in this area, we need to be looking at it, as well. I think right now the calibra says, what, 50 of the currencies that are in the basket here that they use to set the value of this is the dollar, is that correct . Congressman, i dont know if thats been fully finalized, but i think the principle is that it will be primarily u. S. Dollars. My concern is, right now, it is good for the United States, but what happens whenever the board of calibra decides, you know, the chinese yuan, because of the economy, looks to be a stable currency, growing in importance in the world, and suddenly they diminish our amount down to 1 3 of the value of the basket of currencies, and now the yuan is 1 3. Suddenly now, we have a real problem from the standpoint that the currency that is being utilized most around the world is the libra, and we are only 1 3 of that. To me, thats concerning. Does that concern you at all, the association could set this and we would have nothing about it, and itd be a negative effect on our position . Congressman, that is certainly something that i think we should look at up front. I cant speak for the independent association on this, but i think itd be reasonable for our regulators to try to impose a restriction that says it has to be primarily u. S. Dollars. One more quick question. I dont know if the chairman will give me enough time for you to answer, but what is the advantage for facebook to be involved in libra . Sorry. What is the advantage of facebook being involved . Your company, facebook, to be involved in libra. What is the end game for you to realize a benefit from this . Congressman, we build some of the most widely used messaging services around the world, whats app and facebook messenger. The vision here is to make it so that people can send money to each other as easy and securely and simply as it is to send a text message. I think sending money would be a very useful utility to add for people around the world in addition to the messaging products we have. Thank you very much. Gentleman from missouri, mr. Clay, who is also the chair for the subcommittee on housing, community development, and insurance, is recognized for five minutes. Thank you, madame chair. Mr. Zuckerberg, the housing rights initiative, d. C. Based watchdog group, and a grieved woman, recently filed complaints in d. C. , in maryland, against seven major Housing Companies who are accused of using facebooks ad targeting tools to deny respective tenants the ability to see housing ads based on their age, which is a protected class under local fair housing laws. The lawsuit also alleges that facebooks algorithm disproportionately showed the ads to younger users. Mr. Zuckerberg, do you agree the to comply with any potential subpoenas and document requests facebook might receive seeking information about how Housing Companies have discriminated . Congressman, i i imagine that if it is a valid subpoena, we will certainly comply with it. Our legal team will. Will facebook agree to produce information about the algorithm it uses to decide which ads users receive . Congressman, for a bit of background here, it has always been against our policies for people to use any of our products, especially our ad products, to discriminate. Recently, we entered into a settlement with the aclu and other civil Rights Groups to remove certain targeting features from advertising. That way, if youre doing targeting for housing, employment, or Credit Opportunities, you cant target based on age or gender or zip code. We also limited the number of interest space targeting options that were available there, as well. Yeah. But for so many years, you engage your company engaged in that kind of product. Was that because it was a lack of awareness as far as your employees are concerned, as far as having any sensitivity to inclusi inclusion, diversity, and nondiscrimination . Congressman, its always been against our policies for anyone to use the ad systems to discrimina discriminate. We enforce those policies through a mix of technical systems and human review. When this complaint was filed by the aclu and others, we were able to reach a settlement that we thought would strengthen our policies and our products and help them uphold the principles that we care about and have always been committed to on this. Part of this is also agreeing to study further the effects of how the algorithm works and what it shows. One of the challenges that we have here that i think is worth calling out is that we dont collect data on the race or ethnicity of people who use facebook. So that is somewhat of a challenge in trying to study whether there are impacts or issues. It is an open question from my perspective, whether one would want us to collect race data on the people who use our services. Thats one of the questions well need to figure out as were studying this further. Let me follow up with that and ask you now, despite facebooks commitments to address civil rights, there is no one in facebooks Senior Leadership with substantial civil rights experience. Why is this . Congressman, this is this is certainly something we care about a lot. We have people at the company who worked on civil rights. Recently, we started this civil rights audit thats being led by very established folks in the civil rights movement. Sheryl sandberg, our coo, is personally leading our Civil Rights Task force that we formalized inside the company to make sure we implement suggestions from the audit and to make sure that this receives senior is the audit independent . Is it independent or from within the company . Congressman, yes, the audit is independent. It is being done by laura murphy, who i think is an distinguished leader in this space. Are they allowed to publicly report whatever problems they find . Congressman, yes. The reports that theyre making as part of the audit will be public. I think theyve already published some things. Do you have a right to limit what is said publicly about the audit . Congressman, im not sure of the answer to that. I think at a high level, the answer would be no, but there may be some specific things around if theres individuals private data or business confidential data or Something Like that, where they might not publish it. Broadly speaking, theyre going to be able to publish what they believe and what they find. Thank you so much. I yield back. The gentleman from michigan, mr. Hi recognized for five minutes. Thank you, madame chair. Mr. Zuckerberg, youve accomplished something nobody thought was possible. Sherman, chair waters, many on the other side of the aisle actually agree with and, in fact, use tweets by the president to support their position. I never thought i would see the day. But here we are. You have taken the puzzle pieces of politics, shaken up the box, thrown them out on the table, and everybody is trying to figure out where they fit when it comes to facebook and when it comes to this Technology Use. I dont fault you for what your tool has become because i do believe it is a tool. I want to explore that a little bit. First, my question is, what share of calibra is facebook . I know it is an association. Im sorry. Of libra is facebook. So it is an association that youve referenced. M do you own half of it . Is it equal shares among all partners . David marcus, who had been at facebook, is heading up calibra. Is it one and the same . Is Calibra Facebook . Okay. Congressman, there are two organizations here. Theres the independent Libra Association. Thats what im wanting to get to know. Which is a nonprofit. It is not a for profit entity. How does the vote heres what im trying to get at. Sure. How does the voting go . Is it what david marcus says . Is it what Facebook Says . Is it you can be overruled by others in the association . Thats correct. Right now, there are 21 companies and nonprofits. There are a lot more that want to join. Each company and Nonprofit Organization thats a member has one vote in electing the board. Right now, there are five Board Members. David marcus is one of the Board Members but is not running calibra. Well, hes been here. In fact, sat where you sat. Sorry. Sorry. I just misspoke. He is not running libra. He is running calibra, which is facebooks payment subsidiary. Yes. But we are looking for the Libra Association is recruiting an independent director, and david is not even on the Search Committee for that. Okay. I asked him the question, because it had been put forward that switzerland is where you were going to domicile this, or the association was going to domicile. He had said that he had been talking to the swiss regulators. The swiss regulators said he hadnt been talking to them and that the association hadnt been talking to them. Id like you to clarify that. Have you been talking to the swiss regulators . Congressman, yes. The misunderstanding there was that i believe that he and the team had been working with the primary swiss financial regulator, finma, and now were also working with the data regulator, which is going to be relevant for this project. You worked with 30 different jurisdictions in examining this. Can you provide us with a list of the regulators that you have talked to . Congressman, i can get back to you with the full list. Thatd be great. All i want to know. Its not a trick question. Just want to know that. Id like to know which u. S. Regulators you have been talking to. Congressman, are you asking about me personally or our team . Well, i mean, you use the royal we on page three of your testimony. Im assuming it is not you specifically. Im assuming its you and your team. I want to know who facebook and calibra and libra have all been talking to in the u. S. I think one of the questions that i have is why switzerland and why not the u. S. , a little bit as the Ranking Member had started to go down. I want to move quickly on that. Will you get me a list of the u. S. Regulators . Yes. Great. Thank you. Heres the real crux, you said that you wont launch without u. S. Regulator approval. What happens if the association decides to launch despite that . Congressman, then i believe we would be forced to leave the association. I would hope that the association would weigh our recommendation and what we say publicly that we think should happen. If at the end of the day we dont receive the clearances that we feel like we need to move forward, and the association chooses the move forward without us, then we will be in a position where we will not be a part of the association. Remaining 30 seconds here. As i said, i believe facebook is a tool. I believe cryptocurrency and libra is a tool. I believe all technology is a tool. It is a neutral tool, just like a car, a plane, a gun, a knife, all of which have been used as weapons for nefarious things at times, and all which have been used to benefit. These various tools are, in society, regulated. Whether it is ms. Wagners concern, and all our concern, about Child Sexual Exploitation or others, you need to help us understand where the line between peoples First Amendment rights, yours, mine, all of societys lie, and the safety of our society, regardless of the platform or tool. Id like to continue that conversation at some point. The gentleman from georgia, mr. Scott, is recognized for five minutes. Mr. Zuckerberg, thank you for joining us today. Back during the 1960s and 70s, Congress Passed a series of laws intended to stamp out discrimination in lending and housing. Both republicans and democrats in Congress Worked together in passing legislation. Like the community excuse me reinvestment act and the Fair Housing Act and the equal credit opportunity act. All of these laws were designed to target and stop discrimination in the seal and advertising of housing. In particularly, red lining. Red lining is a series of practices, of cordoning off certain groups of people by race, by gee i cant haographic systematically refusing to lend to those communities. Were even suffering right today from the aftershock of these practices. Now, its my understanding, mr. Zuckerberg, that facebook allows advertisers to target their messages to certain users or groups of users, both dire directly by identifying their race, their gender, or age, but also by indirectly targeting their education, their interests, their location, their income. In an investigation of hud, your platform allowed advertisers to restrict certain users from viewing ads on your platform. You have even enabled the practice of this dreaded red lining of certain communities, restricting them from housing and employment opportunities. You were charged with this by our federal agency. That protects our housing and lendingzuckerberg, we in congre have worked hard for the past 50 years to eliminate the very Racial Discrimination practices that your platform is guilty of. On your platform, you screened for and you prevent all sorts of criminal activities, such as sex trafficking, drug trafficking, even as you mentioned a few minutes ago, you outlaw payday lending, terrorism, illegal drugs. Why dont you prevent red lining, which is also illegal and criminal, as well . Congressman, we do now. Our policies have always been to that discrimination is not allowed. We recently entered into a settlement with civil Rights Groups, aclu and others, and fha sorry fha to remove certain categories from our targeting, including age, dependedepend gender, and zip code. You say to remove. Its implemented. You havent said we have removed. My theres a difference. My understanding is this is this is already implemented. If im incorrect on that, i will get back to you quickly and update you. My understanding is that that is already in effect. Mr. Zuckerman, i have here huds report. It clearly says that your platform allows advertisers to restrict certain users from viewing ads on your platform, and you have even enabled the practice of red lining certain communities. What is your answer . I mine, what was your response to hud . Well have you put things in practice to eliminate this . Well, congressman, i think at the beginning of the discussion with hud and some of these groups that i just referenced, we entered into a settlement with the separate with the civil Rights Groups to create a new standard where we block that kind of targeting. I think it is worth noting the standard we set is industry leading. I dont think any of the other internet platforms restrict the kind of targeting we do for these categories. I think that doing so helps us uphold the principles around preventing discrimination. Im happy and supportive and glad were doing that. Thank you, mr. Zuckerberg. The gentleman from ohio is recognized for five minutes. Thank you, madame chair. Appreciate you holding this hearing. Mr. Zuckerberg, good morning, how are you . Im doing okay. I understand. That was honest. Thank you. First, i want to say i appreciate innovation, and we need innovation in america. No innovation is going to be perfect. To the questions the gentleman was just asking, i want to let you maybe clarify a little bit. If i want to advertise housing on facebook today, can i use age, sex, and zip code to target people today as we sit here . Congressman, i believe the answer to that is no. Thank you. I think im right on this. All right. Just confirmed with my team, as well. You cannot do that today. Yes. Those options are no longer in the system for housing, employment, or Credit Opportunities to advertise with. Nobody wants to red line, and im sure that was accidental. I want to talk about calibra for a little bit. I am concerned about the establishment of a private currency which is used for transactions because i think it does undermine other currencies in the world. Theres 195 countries. Two of them are sovereign countries. Two dont have currencies. 193 countries that you are opening yourselves up to regulation from. Why not just pick another currency . You can you know, youre going to make money through the transmission of the of whatever it is. Its not about what currency. Why did you think you had to create a private currency . I guess i would ask you to maybe go back to your folks and think about whether the pain youre going to have in creating a private currency is worth it. But why create a private currency . Why not pick a currency and use that as part of your Payment System . Sure. Thanks, congressman. The the goal of libra is to build a global Payment System rather than a currency. Because it is global in nature, we figured that it might be better to not solely rely on one countrys currency. Because were an American Company, and because the American Economy is the strongest in the world, it makes sense for any reserve to be primarily u. S. Dollars and extend americas Financial Leadership in that way. But like youre saying, we clearly have not locked down exactly how this is going to work yet. I personally am much more focused on being able to help innovate and build a global Payment System than i am in any specific makeup of what a currency or reserve might look like. I think theres already some discussion about whether it might make sense to build the kind of digital Payment System were talking about based on individual sovereign currencies rather than a kind of combined or a combination of these currencies into some new a new one. Thats something thats already been considered. Great. I think youll find the banking secrecy act, Money Laundering, itll be hard with the Digital Currency. Ultimately, you may find a sovereign country that creates a currency you could use, or you could do it based on several stable currencies around the world. If youre in europe, you can pick one. In the americas, you can pick one, whatever. There are a lot of people around the world who need what youre talking about. This crossborder opportunity to efficiency send money back and forth in countries where theres no stable currency. Think about venezuela for a second. The venezuelan boulliver is w t worth less than it was a second ago. There are countries where there is no stable currency. There are millions of people in the world who are hoping that your innovation works. I think you may have bitten off more than you can chew by trying to create a private currency. I would ask you, and i know youre already relooking at it, but i hope youll think about that. Because you can make a difference and, frankly, you can have a Payment System without creating that private currency. I think youll find that the compliance with the individual laws, whether antiMoney Laundering, bank secrecy act, sanctions, all those things will be easier to do if you use an existing sovereign currency. I would just ask you to think about that. You can comment if you want to, but i wanted to use my time to ask you to think about those things. Congressman, thank you. I think those discussions, to my understanding, are already happening. Some are happening publicly. There have been Public Comments on this. I want to reaffirm what youre saying about how this could be valuable to people around the world. We serve more than 2 billion people around the world. We serve a lot of people in the United States, but there arent 2 billion people here. Most of the people we serve are in countries that have developing economies that i think could really benefit from this. Thank you. Mr. Green, who is also the chair for the subcommittee on oversight and investigations, recognized for five minutes. Thank you, madame chair. I thank the Ranking Member, as well. I thank the witness for being here today. Sir, is it true that the Libra Association oversees the libra project . Congressman, yes. And is it true that Global Corporations make up the association . Congressman, the association is made, to date, of 21 companies and nonmoprofit organizations, as well. Of the 21, how many are headed by women . Congressman, i do not know the answer to that off the top of my head. I can get it for you. I know you can get it, but one would assume that you would know who heads these corporations that are going to be running this global company. How many of them are minorities, mr. Zuckerberg . Congressman, i do not know off the top of my head. Are there any members of the lgbtq plus Community Associated with this association, mr. Zuckerberg . Congressman, i dont know the answer. Who can there are many people who acknowledge they are part of the community. Sorry . You do not know. Mr. Zuckerberg, is it true that the overwhelming majority of persons associated with this endeavor are white men . Congressman, i dont know off the top of my head the list of the people who are running the organizations in the association. Is it true that one would have to have 10 million to become a part, aside from other qualities, to become a part of the association . Congressman, i believe that was the initial idea, but i dont think that has been locked down yet. Well, isnt it true that persons have already bought into the association and paid 10 million . Congressman, i do not believe that has happened yet. Well, i spoke to your person who manages calibra, and he indicated that he is one of the holders of a post with the association. Is he incorrect . Congressman, youre right that david marcus, who runs the calibra subsidiary for facebook, is facebooks delegate for to the independent association. The question i was answering is i dont know if the association if the organizations that are members of the association have yet contributed any Financial Support for the organization. Well, i must say that i would assume that you would have the answers, but i would greatly appreciate it if you would share this with me. Because i plan to share it with the public. The public needs to know whether this is an organization that is truly diverse or whether it is an organization that is owned and operated by a small group of persons, all of whom have similar characteristics, for lack of better terminology. Now, let me share this quickly. This does not apply to you, mr. Zuckerberg, but you need to know why there is a deal of consternation. There was a man whose name was bernie madoff. Mr. Bernie madoff was the chair of the nasdaq. He had all of the trappings of being a successful, responsible person. Hes now serving 150 years in prison. His ponzi scheme involved some 64. 8 billion. The people who are for free markets bought into this ponzi scheme. They were laissezfaire. Once they lost their money, they made their way to us. They wanted us to make them whole. This is why we have to be concerned. Not because youre a bernie madoff. I want the press to clearly understand im not saying this, that you are, but because things can happen. Things can go wrong. When they do, we are the people who have to make them right. I yield back the balance of my time, madame chair. Thank you. The gentleman from kentucky is recognized for five minutes. Mr. Zuckerberg, welcome to the Financial Services committee. Criticism is cheap. Anybody can criticize. As you can see here today, politicians in washington are pretty good at lodging criticism. But creating something of value is significantly more difficult. I would commend you for being an innovator and trying to create something of value. It seems like in washington, whenever the private sector produces some type of innovation or new advancement, politicians and bureaucrats rush in to criticize or regulate. In an era where some politicians in washington and even some politicians on this committee are openly embracing socialism and central planning, it seems the presumption is always that private Sector Innovation is a bad thing. I think that presumption should be reserved. We in congress should view innovation for its potential opportunities for inclusion, reducing friction in transactions, aiding Small Business, and bringing the Financial System to unbanked and underbanked communities. Thats not to say we shouldnt ask questions, which is, of course, what were doing here today, but in america, a country built on Free Enterprise and capitalism, it is always better to be on the side of innovation. We should always place the burden on the government to justify regulation and intervention. Now, i was very interested in your testimony, mr. Zuckerberg, when you eluded to the risks of not innovating and the danger of u. S. Falling behind other countries or Foreign Companies who are creating similar platforms. Will you elaborate on the initiatives in the other countries . Yes, congressman. Thanks for the opportunity. You know, today, the as soon as we put out this white paper on libra, what we saw was, in china especially, they immediately kicked off this Public Private partnership with some of their Biggest Companies in order to race to try to build a system like this quickly. They could use it as part of their belt and Road Initiative, their foreign and economic policy, to fwrgrow influence throughout asia, africa, areas. Theyre planning on launching in the next few months. I think the issues are important when were talking about libra and calibra, but the american competitiveness angle and the competition with china is a National Security issue. The fact that facebook and the Libra Association is launching into innovation, i think it is positive for our National Security. Mr. Zuckerberg, i do want to commend you on statements you made recently at Georgetown University about free speech and the First Amendment. I was particularly happy to hear you say you will, quote, continue to stand for Free Expression understanding its messiness but believing that the long journey toward greater progress requires confronting ideas that challenge us. Im reminded of what jon stewart mill wrote on liberty, and i would commend it to my colleagues and my friend, the chairwoman. Mr. Mill wrote that, quote, if all mankind minus one were of one opinion, and only one person of the contrary opinion, mankind would be no more justified in silencing that one person than if he had the power, would be justified in silencing mankind. This sentiment is important and relevant to facebook, especially in todays age of political corre correctness, accusations of safe speech, safe places, and the polarization of our political discourse. I do find it highly troubling that politicians are trying to bully you to be a factchecker. To be the speech police, especially in politics, at the core of the First Amendment. Along those lines, i want to ask you a question about censorship and whatever factchecking board youre delegating these responsibilities to. Will you commit that facebook will not censor any political ad placed on your platform or in support of President Donald Trump . Congressman, my committee on this is that or the principle at least here is that we believe that people should be able to see for themselves what politicians are say. That doesnt just go for trump. That goes for any of the candidates, for any of our national offices. People need to be able to see for themselves and be able to make judgments on what the candidates are saying and their character. I applaud you for that. I dont want you to be bullied by politicians to relinquish our treasured free speech under the First Amendment. Protect it. Dont be bullied by politicians who want to censor politically incorrect speech. I yield back. The gentleman from missouri, mr. Cleaver, who is also the chair for the sub kmicommittee International Development and Monetary Policy is recognized for five minutes. Thank you, madame chair. Thank you, mr. Zuckerberg, for being here today. In response to letter i sent to fsoc, i was told that its unclear whether u. S. And foreign regulators will have the ability to monitor libra and require any kind of corrective actions. Then, at the same time, if u. S. And International Regulators are, as theyve said in the in my letter or the letter to me, unaware if they have the ability to monitor your network and then protect against Money Laundering andter torandte teta. How are you going to get over the regulatory hurdles . If theyre already saying that. What happens if regulators just throw up their hands and say that we cannot guarantee the soundness of this product . Thank you, congressman. So there are two parts of the process here. The first is what we and the rest of the association are trying to do to design this system so that it eliminates those risks. The second is the process of working with the regulator on their concerns and questions to make sure it meets approval. On the former, the key part of this is that the system will be fully backed, one to one in the reserve, by a mix of cash and highly liquid assets. That sets it in contrast to the way that most banks work with the fractional reserve, where there could be a run on the bank if a lot of people want to withdraw from the system. Here, everything will be backed one to one. In theory, that shouldnt be possible. Now, in practice, i get that, you know, sometimes there are additional risks beyond what the theory says should be possible. We need to work with the regulator to work through their questions and concerns and make sure that we are operating at the highest level of rigor, for Financial Stability. Thats why my commitment is were not going to launch the libra Payment System here or anywhere else around the world u until we get the approval from fsoc and the other relevant u. S. Financial regulators. I was pleased to hear you say that. Now, there is a mechanism that youve talked about that you wanted to roll out. I guess you already have begun to do that. Which would be some kind of a review mechanism. Can you share that review mechanism that would, in some ways, tell you, an independent group would tell you what they believe to be violations of human rights that end up in facebook and so forth . Thank you, congressman. I believe youre talking about the issues around content and hate speech, areas like that. Yes, yes. So this has been an area where, you know, our principles we want to give people as much voice and freedom of expression as possible. Of course, there are going to be some things that infringe on others rights or can cause harm. One of the things that weve struggled with is how do you develop a nuanced set of policies that can identify all of the different types of harms . Weve talked about a number today, including terrorism and Child Exploitation and aspects of hate speech or health misinformation. Theres about 20 different categories that we track all in. We develop policies. We have more than 35,000 people at the company who work on safety and security overall. We spend billions of dollars a year on this. Our budget on safety and security is greater than the revenue of our company at the time we went public in 2012. It is a big effort. But, nonetheless, i believe that it should not sit on any one companys shoulders to make so many important decisions about speech. So one of the things that ive tried to focus on doing is building an independent Oversight Board that will consist of people with diverse backgrounds and views and is global, but who all value freedom of expression. This group will be able to make final, binding decisions on what content stays up and comes down on facebook that even i or our team wont be able to overrule. Itll create a check and balance, an oversight of our companys operations. How do you extricate yourself from that, from that body that you would be creating . Congressman, the way we are setting this up is so that we will appoint the first set of cochairs for the body. We hope to do this in the next few months. Then they will nominate a set of other members. We will jointly agree on them. Once the board is up and running, it will nominate and kind of refill itself. We will not be involved in the Selection Process after that. Thank you. Madame chair . The gentleman from colorado, mr. Tipton, is recognized for five minutes. Thank you, madame chair. Mr. Zuckerberg, a number of my colleagues have im over here to your left. There you go. Okay. Theyve expressed some consideration that needs to be taken in. In regards to the payment industry in the Libra Association, as youre well aware, a number of businesses had extensive experience in international payments. Mastercard, visa, have pulled out of the association. Would you view facebook as an expert in the payments industry . Congressman, were not traditionally primarily a payments company, but the person who is running the calibra subsidiary for us, david marcus, was president of paypal before, which is one of the great payments companies. We certainly have other Financial Experts on the Management Team and board of the company. You know, youd also noted in your testimony today that youre going to be looking for u. S. Regulatory approval in terms of aml, bsa, to be able to make sure that facebook, for its part within the association, will continue to participate. If the Libra Association cant satisfy those regulatelatiions, calibra pull out of the association . Congressman, the short answer would be yes. If we dont come up with a solution that gets the u. S. Regulatory approval, then presumably well continue working objen the proposal untie can. But were not going to launch anything without u. S. Regulatory approval. You would pull out . I didnt hear that. Youd pull out of the wallet portion with calibra . The case i was referring to before where we might be required to pull out is if the association independently decides to move forward on something that were not comfortable with. Right now, i think my understanding is that everyone is aligned on making sure that we have u. S. Regulatory approval to launch anywhere in the world, and thats the goal. Thats the plan. From what you know currently of how it is being structured, is there an internal monitor in place . Could you describe that in regards to amlbsa . Congressman, sure. There are multiple levels of the work here. So theres going to be some work at the network level, at the Libra Association level, the architecture of the system itself, that supersedes all the individual work the companies are doing to implement this. Then, of course, the companies that are members of the association or are transacting, using this Payment System will be responsible for themselves implementing and following those rules. Within facebook, we have a big effort to make sure we can verify peoples identities and authenticate them. This predates calibra. We do this today on if someone wants to run political ads or run a large page. I do appreciate that. One of the concerns with facebook, and then perhaps financial participation with libra, calibra, thats going to be going in, youd had major hacks, losing personal information for millions of users that have gone through. What appearances are actually going to be in place to make sure that the users with the most Sensitive Information that you can have in terms of finances are going to be protected, and then also, again, including bsa and antiMoney Laundering . Thanks, congressman. The Payment Information that people share is stored separately from other information in our services. All of our information is stored secu securely. We work hard on security. This is especially secure. I dont think weve had an issue with this to date. We do even though we havent launched calibra as a product yet, we take payments for a number of things, raising from fundraisers to people buying ads. We have a secure tier in our data center focused on Payment Information, and that has worked well so far. We also youve had no data breaches in that field . My understanding is we havent had any issues on that in the payment area. Okay. Thank you on that. You know, one of the issues that i am concerned about is are we going to be able to use if libra comes into place, can we use it to buy anything that is legal in this country . Would you support that . Congressman, i think the intent would certainly be to have it be give people as much control over what they want to do as possible. Of course, there are certain types of goods that are regulated and that require additional process to allow that. Then there are certain content policies that i just think were not we havent developed yet. Thats much further downstream of where we are now, of basically just trying to make sure we can architect a system that works and that gets the appropriate Regulatory Approvals. Thank you. The committee will take a fiveminute recess. As you heard, a brief break in the testimony of facebook ceo Mark Zuckerberg. Hes on capitol hill here today, testifying before the Congressional Committee about facebooks plan to create a cryptocurrency called libra. Discussing its possible impact on the financial and housing industries. Hes also been asked about fake news pages, online advertising, and using member data in media censorship. Again, he is testifying before the house Financial Services committee. We expect this hearing to resume in just a moment. Committee chair Maxine Waters is still in the room. We do expect it to start up again here in just a moment. Live coverage on cspan3. The committee will come to order. The gentleman from colorado is recognized for five minutes. The other coloradoan. Thank you for appearing today. Thank you for your testimony today. So i just want to lock one thing down where i heard two answers from you earlier. Ms. Maloney was kind of going through a list of regulate eorsd wanted to know if you would wait for their approval. She went through a laundry list of them. Your answer was, well, for the parts that apply, yes, were going to go seek their approval. You used the words, seek their approval. Other times, you said, we will get their approval. So just from facebooks standpoint, are you just willing to seek the approval, or are you going to wait for the approval before anything is launched . Congressman, it is the latter. Thank you for the opportunity to clarify that. We are not going to launch anything until we get the approval. I also, if its okay, want to take a moment to correct and add some context on one of the other questions asked before in catching up with my team. So long as it doesnt take long. 30 seconds, correct. The question before was around whether wed implemented the changes to ads targeting to make it so people can no longer target age, gender, and zip codes, and a bunch of interest categories in housing, employment, and credit opportunity ads. The answer is we have implemented that change in the primary surface for buying ads on facebook that covers 80 of the ads. It is part of the agreement and the settlement to have a time frame to implement the rest of the 20 by the end of the year, which we are on track. Thank you for the answer. The reason youre in our committee is we may have issues about the ads that youve allowed, whether russians were involved, the disinformation. Youre here because of libra and calibra, the Financial Services committee. Mr. Marcus was here to testify. Really, we want to understand what this is. Is it a currency . Are you a bank . What is this association . So i appreciated mr. Mchenrys questions we all like innovation, but it seems like this innovation is going to be housed in an association in switzerland. Not in america. And the, i donyou know, constit starts this with article 1, section 8. 5, we are given, the country is given, the obligation to coin money and regulate the value thereof. So do you consider libra to be money . Congressman, i consider libra to be a Payment System. I think those are two ideas that can sometimes be hard to tease out. The u. S. Dollar is certainly very strong, as weve talked about today in a number of places. We certainly do not seek to undercut that. We want to extend american Financial Leadership across the world. All right. So you dont consider it to be money . Congressman, i consider it to be a Payment System, which is an area where i view the industry that we have here as relatively stagnant and not and i appreciate that. Im just starting with the constitution here. Okay . Which puts the responsibility on us to coin money. Im just trying to figure out, and i was trying to figure out with mr. Marcus, too. Lets go to the next step. Calibra, which is the wallet, which in my opinion is the bank. The libra is in the calibra. Is that not right . Sorry. I didnt understand that. Libra, the currency, is in the wallet, calibra. Yes. Calibra is our so its like me having my money in wells fargo bank. You could think about it that way. Although were not a bank. Were not applying for a bank charter. I forget the analogy thats the problem, mr. Zuckerberg. Thats what were facing here. This was the same place i ran into kind of a trying to understand what this thing is that you all are creating. I appreciate creation. Id like it to stay in america, not go to switzerland. But youre putting an association together. As ive been thinking about this, it reminds me of two movies, doom and the president s analyst. If you want to talk about either one of them, im happy to do it. President s analyst was everybody had information or the phone company had information on everybody and wanted to take over the world. So we need to know what this is. We have to regulate this. Im not sure you guys understand what it is. Thank you. The gentleman from texas, mr. Williams, is recognized for five minutes. Thank you, madame chair. Thank you for coming before our committee today, mr. Zuckerberg. Your biography is a textbook example of the power of capitalism. Im a Small Business owner for 50 years. Im amazed at what youve done. You were a college student, and you had an entrepreneurial spirit to create a company in your free time. After years of hard work, you transformed what started as a simple idea into one of the largest, most powerful Technology Companies in the world. I dont agree with everything facebook has done in the past, but that does not diminish what you have built. It makes me proud to live in a country where this hard work is rewarded. I consider myself a capitalist. It is great to hear that. Youve received scrutiny for taking on something as bold as the libra initiative. This project is understandably drawn the attention of everything. However, i said this when david marcus came before the committee in july, and it rings true today, we should not discourage the private sector from investing their own time and money to research these new technologies. Private sector technologies. Private sector always seems to get it right, most of the time. There could be undeniably be benefits in bringing this product to market. No matter what policies we enact up here in congress, the private sector will be the engine that brings gamechanging technologies into existence. So, mr. Zuckerberg, can you explain why the private sector is better equipped to Digital Currency like libra instead of the Federal Reserve or another entity. Congressman, im not here to say others shouldnt put their own ideas forward. I just think that is part of the american system. We should encourage more people and companies, Small Businesses, large companies, even efforts from the government, to try new things. I think this is an area where our Financial System has been stagnant. It isnt serving a lot of the people it needs to. And i think when thats the case, there you know, this is an important area. There are always going to be risks to any project that comes forward. And we need to make sure we diligently address those risks, thats why the regulations are in place. I think there are risks to not trying new things, too, and not having a lot of different approaches towards that. Im not here saying my idea or this approach is absolutely the very best one. I wish that other people were trying to do Different Things, too. I think that would be important for helping to serve people both here and around the world. Okay. Now, some of my colleagues on the other side of the aisle, which youve heard today, have come up with the legislation that would prevent Technology Companies from offering Digital Currencies. I personally feel like this is an extremely shortsighted approach to this issue and that it would put a selfimposed handicap on American Companies and entrepreneurship, which make this country great, compared to our counterparts arnoound the world. You testified about this with congressman barr but i think we need to repeat it. Mr. Zuckerberg, what other countries, specifically china, are doing in the Digital Currency space . Congressman, i think right now, especially related to libra and this idea, Chinese Companies would be the primary competitors. You know, there is an ongoing Public Private partnership in china where theyre very focused on building this and exporting it around the world, which i know there are a lot of questions that are i think, are completely valid questions about how a project like this would impact, you know, americas Financial Leadership, our ability to impose sanctions around the world, our oversight of the Financial System in a lot of places. I just think we need to trade off and think about and weigh any risks of a new system which i think are surely risks if a chinese Financial System becomes the standard in more countries because then it would be very difficult, if not impossible, for us to impose our sanctions or the kinds of protections that i think were right to want to have oversight around the world on all of these different countries. And thats something that i worry about. On the first page of your testimony you state, we face a lot of issues over the past few years and im sure people wish it was anyone but facebook. I appreciate you address this issue headon. Im probably running out of time, so ill stop right there. I want to yield my time back and say im really glad youre a capitalist. Thank you for being here. Thank you. The gentleman from connecticut, mr. Himes, is recognized for five minutes. Thank you, madame chair. Mr. Zuckerberg, thank you for being here. I want to take it slightly off topic today because i sit on the intelligence committee. Ill never another get looking at the thousands of ads and twitter posts russians had purchased. Those posts playeded on the painful and often explosive divisions in our society, race and gender and religion. Ill never forget in particular a post that was in spanish that urged people, presumably latino people, to vote on their cell phones. And i wonder how many actually did. I read your recent speech at georgetown a couple of times on freedom of speech. If you dont mind my saying, it came off as onesided. It spoke about Martin Luther king and black lives having a voice but it didnt say anything about Indian Muslims killed because someone used a Facebook Post to organize a mob or rohingyas dying in myanmar because authorities used a post to organize a mob. And my point is, obviously, that what your georgetown speech missed, in my opinion, is like all of our rights, freedom of expression is really hard. At least its really hard if it means anything. It means that the government will defend the rights of nazis to march through a jewish neighborhood in illinois. It means well spend our taxpayer dollars to defend the right of a black Football Player to take a knee during the National Anthem or an american to burn a American Flag with all that passion and emotion that generates. In 1998 we didnt say freedom of expression is a good thing. We put in places and committed the resources and invested in those things that would make us worthy to live in a context of freedom of expression. We established regulation through a democratic and transparent process. We spent a lot of resources to regulate commercial speech. Most importantly, we invested trillions over the years in educating americans. So that when they see something they hate, instead of picking up a gun or a knife, they actually formulate a rebuttal. The town i live in invested about half of its tax revenue in education. So, my question is really simple. Facebook, and im a customer, today is more like a country, in my opinion, than like a company. You have global reach, apparently half of americans get their news from facebook. So, my question is really simple. Given the investment that we made in establishing the context for freedom of expression, what commitment will you make, what investment will facebook make you have almost 50 billion in cash on your books. Tell us what investment youre making so that this freedom of expression, which you enable, is a good thing rather than a bad thing, so that the good side of freedom of expression overwhelms the rohingyas and Indian Muslims and all that can be bad coming out of freedom of expression. Congressman, thank you for the opportunity to address this. I talked about a number of the risks in the speech you referenced, but at a high level i think youre right. When you serve billions of people, even if only a very small percent of them use our services to do harm, that can still be a lot of harm. We certainly have a big responsibility to make sure that we address all of the new threats that come from the internet and as well as existing threats that have been there all along. So, there are so, this is something that in terms of our resources and what were doing, you know, since 2016, weve built much more sophisticated ai systems to proceactively identi harmful content. Now 99 of the terrorist content we take down, our ai system removes and identifies before anyone sees it. Thats the kind of thing we want to be doing for all the categories of harmful content. Let me stop you there. I got that. I get that. And thats important. But what im really looking for is what is the parallel commitment that facebook will make with its half trillion of market cap and 50 billion in cash, what investment will you make in education, in good public discourse, in basic decency . Im looking for a commitment. I see. For what you will do to help make this society worthy of Free Expression. So, i think its two things. One is on the safety side, its a major investment in proactively eliminating harm. And then on the pro active side well be investing a lot more in partnerships with highquality journalists and publications to foster that kind of content. But as i mentioned earlier, we dont have more than 35,000 people at the company who work on safety and security. We spend billions of dollars a year on it. Its a very significant portion of our budget and expenses. We spend more money now on safety in security in a year than the whole revenue of our company was at the time we went public just earlier this decade. So, a lot of the things were doing now simply would not have been possible even, you know, six or seven years ago for us to do. And but now, you know, were a big company. I feel like we have a responsibility to do this. You have my commitment my time is expired. I think you have a responsibility to do more than police. I think you have a responsibility to actually invest. But thank you. My time is expired. The gentleman from arkansas is recognized for five minutes. Thank you, chair. Thanks for holding this hearing. Mr. Zuckerberg, were glad to have you on the house Financial Services committee as a former startup investor and entrepreneur and banker, i congratulate you like so many of my colleagues on an extraordinary investment and entrepreneurial success in creating facebook. I do also admire people in our capitalist system here that are disrupters. That find a gap, find a weakness and try to exploit it with a new product thats better for consumers. If we hadnt done that over the past 50 years in finance, we wouldnt have atms, we wouldnt have credit cards, we wouldnt have free checking or securitization or 401 k plans or mobile apps. So, of course, this committee is keen to embrace innovation. And working with my friend, dr. Foster down there on the thin tech task force and the Ai Task Force, this is important and its want issed by bipartisanly that we support innovation on this committee. I certainly dont want to punish the Libra Association for a product that hasnt even existed yet, but i was reading the g7 report that mr. Marcus participated in. And the g7 report says the g7 believes no global stable coin project should begin operations until the legislative regulatory and oversight challenges and risks outlined above are adequately addressed through appropriate designs, adhering to regulations that are clear and proportionate to those risks. Is that a statement that you agree with . Congressman, i havent reviewed that report in detail, but in general, we understand that working in Financial Services and payments i mean, this is an area thats very sensitive. Peoples money is obviously extremely important to them. And there are good regulations that are in place to make sure that all services basically protect people and yeah. I want to make sure we do the same and are at the same standard or higher in everything that we do. Well, i appreciate that. Thats good. I think be youve made it clear to mr. Hazanga and others that the libra will not go forward in any country, in the world, unless it meets an adequate standard here in the United States. I guess what im saying is this g7 announcement last week mirrors that exactly. That the g7 countries, beyond the United States, agree with that view as well. Lets talk about privacy for a minute. George guilders wrote a great book called life after google. Im sure you read it. If not, i commend it to you. A quote im paraphrasing. Private keys are held by human beings, not by governments, not by google. I would add parenthetically, not by facebook. Do you support the idea as a future digital world, each individual controls our data and we exchange it only when relevant at the time necessary to conduct a particular transaction . Is that a world you acknowledge is the future . Well, congressman, i think it might be a little more nuanced. I certainly think that people that there should be private tools that people can use to Exchange Messages and information privately. Thats why whatsapp is encrypted and were moving our private messaging tools to being encrypted. As content gets broader and more publicly visible, there the equities and values and the balance there shifts towards upholding Public Safety in addition to privacy. And i think that thats if someone is sharing something very broadly, we need to make sure its not, you know, broadly inciting violence or no, i understand that. Im talking about peoples personal data, the privacy of peoples personal data. That its theirs to share as they deem fit under some authentication. Let me move on. Lets talk about Digital Currency. Dr. Foster and i also september a letter to chairman pal at the Federal Reserve about the idea of a digital dollar. My interest in that was actually raised by mr. Marcus in his testimony. Wouldnt it be easier if there was a digital token that was a u. S. Dollar for that simply to be the digital token youre looking for, and as noted here, that you dont go and try to create something separate . So, my understanding, congressman wouldnt be that meet all the standards you need . You want to lower costs, you want to create a different rail for payments. Wouldnt that be successful in doing that . My understanding, congressman, is that the community is fairly split on this point. I think from a u. S. Regulatory perspective it would be simpler but were trying to make something that would be a global payment that works in other places, it may be less welcome in other places if its only 100 based on the dollar. Yield back. Thank you, chair. The gentleman from illinois, mr. Foster, is recognized for five minutes. Thank you. And im proud to join representative hill as the other half of the chairman of the Ai Task Force that were working on. I may be the only ai programmer in the u. S. Congress, so i have to admit i play around with tencer flow more than pie chart. Sorry about that. Well get you over. Im introduce the dashboard act which provides transparency to consumers and regulators about what data is being collected and also how it is monetized. It also provides limited rights of deletion. And i was wondering if you would be willing to comment for the record on what you think is the technical feasibility of that as well as any policy concerns you might have. Congressman, could you clarify which part you want me to the feasibility of the data specifications, the collection, delivery to consumers. Theres lots of details that have to be filled out in any project like this. How would a consumer authenticate himself making sure hes looking at his data, so on. Also if you have the right to delete, you also have to authenticate yourself appropriately. You know, thats a whole bag of snakes, as youre aware. Have your staff have a look at that. If you could get back to us, for the record. If you see any technical problems in the implementation of it because i think its a good step forward. Now, you have been asked, and i dont think we received a clearance, as to whether or not libra will allow truly untraceable, anonymous transactions. And can we have a clear statement on that, you know, is it will it be possible to conduct anonymous traction using libra . So, calibra no, libra, libra, libra. I think that this is if youre an onramp onto an anonymous platform that allows anonymous platforms, then theres a whole host of problems. Will libra allow anonymous transactions . Its an open question whether we allow you published your code. To look at your code it seems to me from looking at the description of the code, that if you have the public key im sorry, the private key, you have control of that libra balance, period, full stop. And that makes it pretty hard its equivalent to selfcustody. If you allow selfcustody, its pretty hard to stop anonymous trading. Have i missed something there . Congressman, i think this is more of a policy issue in question no, as your code currently exists, can you can you transact anonymously with libra . Congressman, it certainly would be possible to build a system that would allow that. I think theres a policy question about what the restrictions are that need to be placed on that. There are equities on both sides. If the goal is to enable inclusion, especially in countries where there might not be i understand the arguments. Im just asking, as it currently exists, it seems to me that anonymous transactions are allowed. If theres something wrong with that i understand you can change the way it operates. But as its currently exists and the code currently exists, i believe its not possible. If im wrong about that, please get back to us for the record. The second thing that you have to come with an answer to is under what conditions fraudulent or mistaken transactions can be reversed. Now, you mention in your testimony that calibra intends to refund unauthorized transactions. But, now, what are the limits to that . You know, for example, if theres i dont know, 1 million ransomware payment made through calibra . Are you going to refund that . What are the limits to that or are there no limits . Congressman, i dont know if weve worked out all of those policies yet, but our intent and principle here is to be at the level of or exceeding the level that people expect from other payment instruments. Whether its credit cards or other things like that in terms of Fraud Protection and Consumer Protection. Yeah, but you have to charge something. If youre depending on what class of fraud youre actually ensuring against, then you have to charge someone for it or its not going to be a profitable product. You havent thought about the details nothing you can give us written on what your current plans for when you can reverse fraudulent or mistaken transactions . Congressman, im not saying we havent thought about it. What im saying is we havent nailed down the policy yet. The specific product policies in calibra, i think, are downstream to working out an architecture for the overall project it has to do the very start you have to understand, is there a mechanism to reverse transactions . You know, if all of these bitcoin billionaires go around with big security details because someone is puts a gun on their head and says, give me your bitcoin, it is not a reversible transaction. And so i dont think people want to live in that kind of situation. And so trying to understand, you know, who will provide what guarantees to allow you to reverse a fraudulent or mistaken transaction. Congressman, facebook is committed to reimbersing people. There may be restrictions like youre asking. We havent nailed down all of those policies exactly. But the goal is just like when youre using a credit card, you expect the Credit Card Company to pay. If theres correct. And there are limits on it. There are welldefined legal limits on it. Thats why the credit card agreements are so long and no one reads them. Thank you. My time is expired. The gentleman from georgia, mr. Loudermilk, is recognized for five minutes. Thank you, madame chair. Thank you, mr. Zuckerberg, for being here today. Madame chair, last evening i was reading the Washington Post website because they had leaked some information that was interesting. And right below their headline was the caption of their motto that says democracy dies in darkness. I want to thank you for holding this hearing today, in this hearing room, in the light of the public, not in the basement of a the capitol complex behind locked doors. Thank you for that. I think its important the American People be able to see what were doing here in congress. Mr. Zuckerberg, you face a lot of criticism here today and a lot of what youre doing. I was in the Technology Information Technology Sector for 30 years. Ive seen it when people shake up the status quo, they get criticized. Even some of your harshest critics here today, i would venture to say, if they havent, will post their comments and maybe even the videos of their questioning on facebook, which is a testimony to the impact that your vision, your innovation has had, not only on american culture, but on business, on technology. It doesnt come easy. Much of the criticism ive seen in my tenure i love innovation. I love find, the Place Technology can fit. You share that as well. I remember back when bill gates was attacked because he challenged lennox. These are the type of things innovators face. I hope you take this in a complementary way that i mean it. But theres another gentleman in this town i think you and he share a lot together, and thats president trump. Youre both very successful businessmen, youre both capitalists, both billionaires. Youve done very well. I think what you chair in common is you both challenge the status quo. He calls it draining the swamp. You see it as innovation. Now, this town is intolerant to shaking up the status quo. Bureaucrats, politicians learn to manipulate the system to their advantage. And when you bring in new ideas, its really hard for them to understand them. Some of the questions in here today have bhen indicative of Everyone Wants to put what youre doing in a box. Quite often when youre thinking outside the box, there isnt a box to put it in. I think we should advance, i think we should seek innovation. Im not opposed to some of the things that youre trying to do. Im gravely concerned about the implications they may have, the operation of it. But i think we need to give it due consideration. So, my questions are really evolved around how this thing is going to operate. How do you see it operating. Because i dont see it fitting in a box. The Federal Reserve chairman told our committees earlier this year that if libra causes problems related to Money Laundering, terrorism, financing privacy or Consumer Protection, they would rise to systemically important levels simply due to the size of the facebook network. Now, david marcus has said if libra is not done right, it could present systemic risks. Do you believe libra is systemically important, especially since youre calling it a Payment System, which is really done by Central Banks . Do you compare what youre doing with libra to Central Banks and should you be regulated as such . Le congressman, the distinction on what is systemically important, my understanding is a big part of that is scale. And i think its worth noting that, you know, just because facebook serves a lot of people around the world doesnt mean that if we rolled out a product that on day one all of those people would be using it. So like any of the things we do, we probably have to experiment and make the product work over time and that would be risky. Were talking about theres a long public period where were discussing this before getting approval and shipping stuff. But i think theres also quite a risk we ship something and it takes a long time to even make that work. So, i think that if the plan works over time, it certainly could rise to the level that someone might determine is systemically important. Ill defer to the regulators judgment on when that is. But i dont think its automatically the case that if something launches and its, you know, a small subset of the people that uses our services that it has to be that on day one. If it does get to that, its deemed systemically important, based on your previous statements that youre going to work with regulators, are you prepared to meet the requirements and the regulations that come with a systemically important Financial Service . Congressman, we would be. Thats why were working on this project, because we we believe that in addition to the other ideas for Digital Currencies, cryptocurrencies out there, having a Payment System that is based on some of those technologies but is regulated at the highest levels and upholds the highest standards on all of the areas around safety and security, whether its Financial Stability or fighting terrorism or fighting crime or fighting fraud, we think that can exist with a Digital Currency, too. Thats what were trying to help create here. Thank you. I have several other questions. Ill submit to the record. I see im out of time. I yield back. Thank you for being here. Thank you. The gentle woman from ohio, beatty, the chairmanwoman on diversity and inclusion, is recognized for five minutes. Thank you,zuckerberg, i want through a number of questions. Diversity and inclusion, fair housing, and privacy and security. Diversity and inclusion is very important to me and its personal for me. Ive been here before with facebook about the lack of diversity and inclusion. Ive discussed this repeatedly with your company over the past years. Im vice chair of the Congressional Black Caucus and the Congressional Black Caucus, for the record, has had multiple meetings with your company, and here we are again. Let me get into Asset Management. Thats a large industry, as we know, Something Like a 70 trillion industry. Facebook has more than 46 billion on record in cash or cash equivalence. And marketable securities. Are any of these funds managed by a diverseowned companies, yes or no . Yes or no . Congresswoman yes or no . I dont believe i take that as a no. You have a stable of big law firms that work on your legal cases around the country. How many diverseowned or womenowned law firms are contracted by facebook . Number. Just give me a number or a range. Congresswoman, i dont i take that as i dont know. How many women or minority partners work on these cases . Congresswoman, i dont know the answer to that question off the top of my head. So, did you review the packet my time. Did you review the packet that went out in notification to you and your team about what was included today in diverse Asset Management was in it. Did you read that . Congresswoman, i theres a piece of legislation that im working on that was in the packet. Did you or your team review it . Everyones talked about your scholarly resume. Did you review the packet that was sent to you from this committee . Obviously thats a no. Let me go to something you introduced. You introduced laura murphy, so you know who laura murphy is because you said her name, right . Yes. Yes. And you hired her as a consultant and in the Opening Statement you talked about civil rights and so we should phrase it a little differently that you are working with civil rights work is a result of the number of lawsuits that you have had with the naacp and even secretary ben carson filed a fair housing lawsuit against you for violations. So, let me ask you this, do you know what redlining is . Yes. Okay. Then you should have known better and maybe if you had real diversity or inclusion on your team somebody in that room would have said that what you were doing in the housing, how you were redlining or using zip codes to eliminate people from getting information. Now, have you read the report that laura murphy sent to you . Congresswoman you have talked about the diversity and introduced her name about the great study and her work, and have you read it and do you know what the recommendations were and when she issued the report, yes or no. Yes. And tell me what the top three things were, and tell me right here, because what were the top three things in her report and somebody talked about lying in the committee and i am only saying. Well, one of them was around ads and the other was setting up a Civil Rights Task force. And who is on that Civil Rights Task force sheryl sandberg. She is not really civil rights and she the coo and i dont think that there is anything in her background and i know her better. So come back better than that if we are going to be talk about civil rights. Do you know who the firm is that you employ for civil rights is . Congressman, i dont know. How could you not know when you have employed the most historical and the largest civil rights firm to deal with issues that are major, and this is what is so frustrating to me. It is almost like you think that this is a joke. When you have ruined the lives of many people, discriminated against them. And you know what percentage of africanamericans are on facebook . In comparison to the majority folk, and you know what the percentages are . People using facebook apps. Yes. Do you know what 2 pthe percentages is well, we dont collect races. Well, it came out in the Pew Research Center report to you. So maybe you dont deal with the things that deal with civil rights and africanamericans and i am going to be sending a number of questions to you that i would like answers to, because this is appalling and disgusting to me and i yield back. The gentleman from ohio, mr. Davidson is recognized for five minutes. Mr. Zuckerberg and thank you for coming in to talk with our committee and your presence here and the testimony and you know, frankly i go back to when i first saw facebook for anyone who put this on the internet, and obviously, you had a vision, and so i am sure those who missed it are kicking themselves today, but you have pulled off a truly innovative county, and while we have captured all of the possible information on the internet as a guy who has scaled it up and as a founder are still still in charge of serving the public, but i would like your insight of where the technology is headed. Prior to facebook, and talking about libra or digital wallet or calibra and bitcoin, and so some of my colleagues you may envy who toeshy sshy nakamoto, becau cannot subpoena him. But clearly, the blockchains are a cornerstone, but blockchain itself is bigger, and so i think that a lot of people took facebooks entry into the space as a sign that you and others viewed it as a much larger view of technology. Could you elaborate on that. There are a number of approaches here. And some of the innovations in the cryptocurrencys and the decentralized of it can be the nature of it is just not what a facebook can add to the industry. We are in the position that we are in and we are not going to be creating something that is centralized that cannot sustain the standards of protecting against the risks that we are talking about today whether it is the stability or fighting terrorism or crime or fraud or regulators to make sure that we can better improve. So the highest standard. I am always looking at more innovation and improvement throughout that space, and the infrastructure space on which to build Financial Services is behind writ needs to be to innovate and continue Financial Leadership going for ward. So when you are talking about calibra, you have to know the customer provisions and the bank seek secrecy requirements, and also talking to finson and all things that you have to do in compliance with that. However, when you are proposing libra and many of the things that are in the space that have been very sloppy with the language collectively to call everything nr the space cryptocurrency where many of the tokens dont aspire to be a currency at all, but represent a good or a service, and in some cases a s s a commodity, and to be neither a security or a commodity. And so they are offshore not because they are avoiding our laws, but they have certainty in certainly switzerland in one of the spaces that is clearer in financial clarity. For instance libra looking at 1 45 today, and i am waking in today, and do you believe that libra has a role to be centralized or the money, itself, decentralized . Well, congressman, i think that you are highlighting an important point which is that there is a big difference of trying to create a digital Payment System and to creating a new type of currency. I mean, what we are talk g aing about is looking at the issues i only have ten seconds. The neutralization is the key, because if you can scrub the value all of the effort in the American Securities law depends on the central actor, and in america that would be regulated as a security, and that has big implications, and my time has expired. I recognize you for five minutes. Wellcome. It is great to have you here. I am sure that you are very excited. Still doing okay . Yeah. I am almost tempted that you cant lie to congress when you were compared to mr. Trump u. Okay. So even though that was untruthful, you donted agree to that with a smile. So before you got here, you sent david marcus to it, and this is not the answer he gave and he was more aggressive in wanting to go forward and certainly what you are saying is superseding what he is saying if there is a conflict in the two. Yes. I also think that our views on what we should do have gotten clarified since then. And how were they clarified . I think that through the public discussion that is happening. I think that we felt that he was not able to provide enough clarity when he was here, and we wanted to make sure that we came and had a clearer answer on this. Thank you for doing that. One of the things that you are probably sensing from us is that the dollar is very important to us and the largest tool of sanctioning a country instead of sending our soldiers there, and so the power that we have of the Banking System is significant and you can see the outlaw states that are able to work with our colleagues around the world. And look at what they are doing, because of the power of the dollar and when that is threatened that is making us nervous, because it is very useful for the foreign, how do i say, projecting the American Values and foreign power do. You understand all of that fairly, because i think that you do, and you have been hinting at it, but i want to make sure that you understand that, because you are playing in a space that is delicate space for us. Congressman, at a high level i certainly understand it, and that is why part of what we are doing is to conduct it from the ground up to enforce the u. S. Sanctions, and the travel rule and a number of regulations important for creating stability and security around the world. That is, i think that is some of what is at stake here is that i just think that if we dont innovate, there is no guarantee that we will be able to extend the same rules and inject that kind of influence around the world going forward. And we have to innovate the country to keep ensuring that we can do that we want you to innovate and you a disrupter in a positive way, but when we see that you want to go to switzerland and said here that switzerland is going to give you regulatory clarity and i would quote james henry that switzerland is the grandfather of the secretive worlds tax havens and one of the places where you can hide your money and do other notorious things, and they are starting to loosen up, because of that and i would give you advice to stay here in the United States and dont go to switzerland and if you are going to follow all of the rules, why go to switzerland . The independent libra it seems to fall apart without you, because they dont seem to exist without you as the big dog in the fight. So if you decided to bring it for the United States, you can bring it there. And you can hide behind it a little bit and i believed you up to now, but i dont believe et, if you wanted to bring it to the United States, you could. Congressman, if you are trying to build a global Payment System, there is some value in housing the independent association in the country and in the place where a lot of the worlds institutions are based. Which is the United States. A lot of them are in switzerland, too, and a lot of them in the u. S. , and our work through libra and facebook and we are an American Company and we are doing it here, and the technology is here and that is why it is important that no matter where we go around the world, we will follow the u. S. Regulations. I wish you would look at that again, because i think it would alleviate a lot of fears if you housed it here in the United States and not switzerland and again my time is almost out, and i would say for an innovator like you, you are sturdy and resilient and the right person at the right place to take this beating. Thank you. Thank you. Mr. Budd, the gentleman from North Carolina is recognized for five minutes. Thank you, mr. Zuckerberg, thank you for your time and you as an entrepreneur. And by chance you are not a securities attorney are you . I am not. Well, we have several draft bills before the committee and the hearing that amend the Securities Law and including the securities act of 1933 and the Exchanges Exchange act of 1934. Before the Committee Takes any action on these bills, i would hope that we could receive testimony from various experts in the Securities Law to provide their views on whether these bills might have impacts which really reach beyond stable coins. It is crucial that members of the committee differentiate between libra which is really not a cryptocurrency and actual cryptocurrencies like bitcoin, ethereum and xrp before we discuss the draft legislation. Many of the proposals which stifle financial innovation and if we are to remain a world leader in financial technology, it is vital that this committee not embrace reactionary laws against the cryptocurrencies. So mr. Zuckerberg, libra has been in the works of facebook for the past years, and since the announcement of the potential members paypal, stripe, visa, mastercard and ebay have walked away from the Association Due to various regulatory and political concerns. Now it is notable that every u. S. Payment processor has exited the association. Unlike current Libra Association members like uber and lyft and other various Venture Capital firms, they were given the most difficult task of Digital Assets which is antilaundering and knowing the customer, compliance. So with no u. S. Payer processers in the association for libra, how do you see libra building a compliance machine that is going to adhere to the compliances that this body has work hard to put into place. Congressman, thank you. My understanding is that there are still Payment Companies that are a part of the association, and of course, david marcus who runs the calibra services has run Large Services and the president of paypal before coming to facebook, and so we have the right expertise to work through the problems and we will work with the regulators to come up with solutions on them. We also have a big security effort at facebook, and so for facebooks part of this work, this is certainly isnt going to be first time in our companys history where we need to fight against the sophisticated threats or the people who are trying to defraud others or other types of harm, and we have built sophisticated ai systems to be able to work on some of those things. But you would say it is more starting from scratch now that the members have left the association . Congressman, i dont believe that is the right characterization. You know, companies joined because they were interested in trying to explore what we were doing, and lot of more companies are interested in joining in the future and i would bet that a lot more do join. The association was, i think, just officially incorporated or i dont know what the right verb is, because it was officially formed in the last few weeks after months of planning, and there is certainly a lot of work ahead. Thank you. So given the centralized nature, how is libra aligned with facebooks earlier claims of building a pro privacy future and how are you going to guarantee privacy and data autonomy in the initial phase of libra . Congressman, thanks for the opportunity to talk about our privacy vision. So, at a high level, the way i think about this is that in our lives we have public spaces like town squares, and we have private spaces like our living rooms and we need the digital equivalence of both. And we have the digital equivalence of the town square like facebook, and instagram and twitter and youtube try to be, but we dont have a digital equivalent of the living room to interact in all of the ways that you would want to in a intimate and secure space. Our text messaging apps today are primarily just text messaging, but i think that there is an opportunity just like we have done with facebook to build in a lot of the different utilities and tools for how you would want to interact with people in a broader space whether it is joining communities, starting fundraisers or starting businesses, finding people to date, and all of these broader utilities, there needs to be something in the private space, too, and one of the most important private ways that people interact is through payments. So we are working on a number of approaches here. Some that work on top of the existing Financial System that have limitations of the existing Financial System and easier to implement, because we can build on top of everything that exists and something more ambitious like here where we are trying to do a more rethorough rethink of the system. I yield back. The gentleman from new jersey mr. G mr. Gothmeyer is recognized for five minutes. Thank you for coming to testify. And i have this letter that is foreign organizations who have had a presence on the platform and distinguishing between the good terrorists actors who had been elected and those bad terrorists actors. I ask for unanimous consent to enter into the record. Without objection this will be entered into the record. So hamas has been recently found in my home state of new jersey, and do you believe that terrorist organizations recognized by the United States of america would be able to have a twitter account or should hezbollah and others take down their account. It is hard for me to say what twitter is going to do, and i do believe we do. And you are a head of a country who heads the foreign Counter Terrorism member, and so should twitter comply with the law and take down hamas and hezbollahs twitter accounts and should they have twitter accounts . As a principle, all American Companies should comply with the american law. Is you believe that hamas and hezbollah and other terrorists groups as designated by the United States of america that they should have to take down their content just like you have done at facebook . It is not my say for twitter, but i have conferred with the team, we not allow them on our services. I hope that twitter will follow suit as the steps that you have taken and google has as well. And while i greatly appreciate that facebook has taken down terrorist platforms, and i am still concerned that it exists in parts of the platform, and in fact, today, there is still video of the horrific shootings at christchurch, new zealand and i assume that troubles you . Of course that would trouble me. And we build advanced citizens to detect these actions and take action quickly. In generally, this is an area where we have invested billions of dollars and tens of thousands of people working on this. It is not that we will ever do a perfect job, but what i am committed to is that every six months now, we publish a transparency report on how we are doing, and proactively identifying each of the categories of harm that exists, how the prif leevalence of themn the service, and what content is identified and versus somebody who reported it to us, and the goal is to improve every period until we can drive to zero. And so you are taking all of the steps and some stuff is hard to get to everything, that is the point, but you are doing your best to try to get to everything. Congressman, i think that is right. Fair characterization. Thanks. And you know, given that it is still exists on the platform, it is part of the concern that i have heard from some about facebooks ability to prevent libra to be used to launder money or fund terrorism, and do you feel that you will have appropriate measures in place to do so . Congressman, i believe that we will be able to do so. We have built some of the most sophisticated systems in the world for addressing new threats. You know, election interference was brought up before, and these are sophisticated nationstate actors from russia and iran and china now, and we see, too, and they are very sophisticated, but weve been able to build the systems that can proactively identify a number of the efforts to this point, and if we can do that, this is a good example to suggest that we will be able to address some of the challenges, too. I appreciate that libra is a broader part of the ecosystem related to the technology space, and so as we talk about and established in switzerland rather than here where we have plenty of highly intelligent and educated citizens to be employ and we should do everything humanly possible to keep the jobs here in the United States of america, and grow this space here. How can we maintain this competitive advantage in the fintech space, and how you have run them, how do we continue to do that here . Well, congressman, most of the work is still going to be done here in the u. S. I think that biggest question for the future is competitiveness. There are clearly very real risks of building anything new in the Financial Services. There are all of the risks that we have talked about today. I just think that we need to make sure that we balance and get to very good answers on those things while still enabling American Innovation. Thank you. Thank you for the candid answers today and thank you for being here. Gentleman from tennessee, mr. Cristoff is recognized. Thank you for calling this important hearing today and thank you, mr. Zuckerberg, for attending. We have heard loud and clear what you have said about the need for innovation in this area, especially highlighting the challenge that we have in regard to china and where we are in the space as we compete with china or china competes with us. I could roll back the clock though, and when you came up with this idea and went to the board of director, how did you tell them that facebook could monetize or profit from the creation and the use of libra and calibra and how did you explain that to the board of directors . Well, congressman, you may not believe this, but that is not actually the first thing that we talk about at the company. We focus on the Building Services that will create value in peoples lives and we believe that if we do that we are able to get some of the value downstream. But it eventually came up though . Yes. How did you explain that . So we identified what we thought was a big need for the Financial Inclusion, and the ability to easily and quickly and affordably send money. The way that this is going to help facebook over time or our business is that basically in our ads system, it is an auction which means that if you are a Small Business, and we dont have a rate that you to pay. You bid and tell us what the ads are worth to you if you can get a new customer into your store or complete a transaction. What we basically see is that when we eliminate the friction for a customer buying something from the business, the value of the business for advertising on our system goes up, and they bid more in the ad system. So if we can make it so that now in addition to the finding the business that people want to interact with, they can also transact with them directly. I would expect that over time, that is going to lead to the higher prices for the ads, because it is worth more to the businesses, and they will bid more in the ad system, but in order for that to happen, there are a lot of steps between now and then that we have to build a system that passes all of the Regulatory Approvals and ends up being successful and useful for people and as third step down the line if that plays out, then we may see a positive business impact. And facebook also becomes a marketplace where the currency is traded for the goods sold over facebook . Congressman, that is correct, and that is separate area that we are working on already. We distinguish between the services that we are trying to offer and payments like this, and some of the other payments that we have, and we have facebook marketplace which a lot of people use to buy sell things that i have made or a lot of y have made, and they have secondhand goods and we are using instagram shopping which is a new way for people to basically connect with the creators and the influencers who they care about and any kind of brand to make it so they can buy things s online and this is a useful product for people as well. You mentioned, of course, one need is the underbanked orren the unbanked in our communities across the nation. Of course, another problem with that is that some the people who are unbanked or underbanked also live in areas without Broadband Services, and also without the sufficient Broadband Services to trade. Does facebook have a plan to address those areas that lack the Broadband Access . Congressman, we do. We work on this both with the u. S. And abroad. We have started working on this in 2013 when we launched the internet. Org project, and we have the facebook connectivity project where we build technology, we build open Source Technology that mobile phone, and mobile carriers can use to decrease their costs which is in a competitive market we hope that some of the save also be passed on to consumers. We have seen certain of the innovations when they are implemented in the countries around the world, because of the cost of delivering broadband go down, now some people can access the broadband who were not able to before, and the amount of the population that gets connected goes up. Overall, the connectivity initiatives that we have had, we have measured across the world, we believe that they have helped over 100 Million People access the internet who were not before. And briefly, you have heard concerns from both sides of the aisle of the operation locating in switzerland and you heard it before todays hearing, and with all of that considered, will you consider, consider yes or no, locating in the United States versus switzerland . Congressman, at this point, we do not control the independent libra operation, but facebook is certainly based here and our investment will be largely here. The gentleman from guam, mr. San nicolas who is the vice chair on the committee of Financial Services is recognized for five minutes. Thank you, madam chair, and mr. Zuckerberg and thank you for taking the time for being here and i wanted to commend you for the amazing platform that you built with facebook. I think that you are right in stating that allowing facebook to be able to allow people to get the message out there as opposed to traditional media, and as an example of that, and so i was able to go through facebook and very inexpensive to what a 30second commercial would have cost me. So facebook has brought opportunities for change and for new people to be able to take advantage of the power of the platform. When you established facebook and first getting started, did you ever imagine it would get this big . Congressman, no. I was building a service for the community in college, and i thought that somebody would build Something Like this, but i didnt think that it would be us. I am sure that when you put facebook together, you never thought that you would be worrying about housing discrimination or Human Trafficking or election interference or the things that you thought to put there in the beginning, right . Yes, you are right, congressman, that the scale is growing quickly, and certainly a number of problems that we are handling now and addressing proactively now and not reactively. And it is worth noting that we have had content policies since the beginning of the company, and our community would have to flag a piece of content, and so it is the only logical way to do it, but at some point along the way, we became a big company that had the resources of all of the folks doing content and security review, and building the ai that we have today, and now that we can, i feel that we have a responsibility to do that i feel that you will do that to make sure it is addressed and no doubt your Business Model depends on it. And while facebook started out as communications and sharing platform and the idea behind it never really was imagined to grow to this scale or imagined to have these kinds of problems is the concern of libra, and while facebook is a communications and sharing platform, libra is a currency and payment settlement platform, and that is taking it to a whole new level in terms of what we might not be able to foresee in the future. That is where i am concerned, because the key to the concern rests in the fact that libra is assetbacked currency and i heard you say that you mentioned that you were going to have libra convert on the onetoone basis and people putting a dollar in and take a dollar out. But in listening to that and knowing how the currency markets work, and knowing that libra is supposed to be backed by a basket of currencies and the currencies fluctuate, it is virtually impossible to have a 1 1 ratio of the money going in and out, and when it is a single going in and a basket invested that has to come out. Has that been something that you factored in . Congressman, it is. And i think that economists, and there is not a clear consensus on the point, and some would argue that it is more stable to use a combination of the currencies rather than to rely on any single one. And what you would have is less volatility, but if you were to have for example a euro, the yen and the dollar and somebody put in a dollar today, because of the euro and the yen and the dollar fluctuate differently, it is unlikely to pull the exact amount out later and this is why the currency markets using swaps and leverage to have arbitrage and balance in order to make sure that the things settle in those ways, but when it is coming to libra, there is no singular entity responsible to make sure that the 1 1 ratio is accountable. So if they were to strive for that, they would have to use the leverage to meet the 1 1 demand and things would grow to the point where it is not sustainable. At the end of the day, who is going to be responsible if libra fails . Well, congressman, the point of the 1 1 reserve backing is to prevent that kind of leverage that you will see in the traditional banking industry. But it is not possible in using a basket of currencies, and the main question that i wanted answered is if libra fails, who is going to be responsible for that . Congressman, the Libra Association will have the reserve, but i understand that this is an important question, and this is one of the things that well be working with fsoc and other regulators to work with in order to have a solution that meets their standard. The gentleman from ohio, mr. Gonzalez is recognized for five minutes. Thank you, madam chair, and mr. Zuckerberg for being here for todays questions. As i have said many times in the committee, i believe that distributed Permissionless Blockchain technologies have fundamentally changed the world in a positive way and i want this country to lead. That is a different statement entirely from what libra is and what we are talking about today and which think that has a number of contradictions inherent in the project itself. When your colleague was here last, he mentioned and the white paper suggested that the goal is to transition to the Permissionless Blockchain, and that still the position, because it seems that it may not be. Congressman, i think that is the aspiration over time. And so that is a yes over time. It is the aspiration, and in order to fulfill the Financial Inclusion mission, there are going to be some people who may not i reclaim my time. I appreciate it. So it is a goal, but it is not necessarily written in stone, and i as i actually said i dont think that you will get there, because you dont have any incentive to, frankly, but that being the case, so in this current world where it is controlled by the Libra Association, the claim has been made, and we dont have to trust facebook, and we dont have to trust anybody, and similar to the claim that would be made on cryptocurrency which is a valid claim, and inherent in that is that we do, because it is controlled and it is controlled by the centralized organization, which is the libra structure, and so how can you make the claim that association libra will adhere to regulations in all place, but have one centralized organization that is going to enforce the law that way . I am sorry, congressman, i dont understand exactly. The Libra Association, and they regulate libra, right. So that is one uniform system presumably. Yes. One uniform code or regulations. Yes. So you claim that libra is going to adhere to all regulations of the countries in jurisdiction, and how can you make that claim, because it is surely, we could have two different sets of regulations in the u. S. Versus the eu and one central organizing structure. Congressman, to clarify the distinction between facebooks efforts and the independent Libra Association, i am speaking for what we are going to do, and committing that we are going to comply with the u. S. Regulations and not launch anything anywhere in the world until we have those regulations. Would you dissociate with the libra project entirely if libra is going on a path that goes against the u. S. Regulations . Congressman, i have testified that we would. Thank you. And then the next thing that is a big concern for a lot of folks that i talk to. You have mentioned that you are not going to mix social and data payment, and i am a trust but verify, and so what Regulatory Oversight are you willing to sign up for the ensure that is the case, because i dont trust you to just do that the ftc order that we just entered into means that we have to certify that at each level of the company, and every manager who is overseeing a team that involves peoples personal data is going to have to certify on a quarterly basis that they are not, to the best of their knowledge that their team is upholding the privacy commitments that we have made. We have made privacy commitments around this, and we have to certify it, and throughout the company and up to me and then i have to certify it as well. You are satisfied with that . Congressman, that is a pretty robust framework. I was not meaning to critici criticize, but i was sincerely asking. And the final point that i would make, and so, we are painting this as sort of the we dont do it, china is going to do it, and you will be hard pressed to find anybody who is more of a hawk on china in this committee and so i do agree that, but what i dont believe is the right frame is if Mark Zuckerberg and facebook dont do it, sxi jinping is goig to do it. And so this is not a Mark Zuckerberg versus xi jinping, and so that is not correct, because i want to have us own this space, but as you rightly point out, having a centralized organization, and ie, frankly, i dont trust it and i dont believe that the American People trust it. So i would encourage you to work on ways to decentralize so that there is no control whatsoever. With that i yield back. Thank you. The gentlewoman from michigan, ms. Tlaib, recognized for five minutes. Thank you so much, madam chairwoman. Thank you so much for being here, and this is going to be really hard in this setting, but try to see me beyond just a congresswoman, but also as a mother who is raising two muslim boys in a pretty dark time in this world as i ask you. Advocacy organizations are pleading with you and your team to prevent groups from using events page which fuel violence against africanamericans, muslims, youjews and the lgbt community. And before congress you said that we do not allow hate groups on facebook and if there is a group that is the primary purpose or the large part is spreading hate, we will ban them from the platform overall. So mr. Zuckerberg, yes or no, is it still your policy to ban hate groups . My understanding is yes. Okay. Face Groups Community standard as it reads says quote, we are committed to making facebook a safe place, and the expression that threatens people or has the potential to exclude or incite violence is not going to be allowed. I wanted to show you a picture that this is a man with a gun outside of a mosque, and this is going to violate your standards congresswoman, i am not in a position to evaluate any given post against all of the standards that we have. So white supremist hate groups still regularly use the events page to organize protests in front of the mosques and the protests are often armed and the hateful rally was planned on a Facebook Event page, and i do want to submit for the record, madam chairwoman, a press release and from the muslimed a voe kates and reported hate groups are still on facebook, and also a newsweek article that says that facebook has failed to stop antihate muslim groups despite the Mark Zuckerberg pledge without objection, such is the order. So why have you not stopped hate groups from endorsing these events and do you agree with it still being kept up . Thank you for raising this. And this is something that is very important and i take it very seriously and it is very hard to police every instance of this, and a lot of the content in the stories that you are talking about i would personally condemn and i dont believe that this is the kind of the thing that i want on any of the platforms and i am committed to making sure that we invest more and do a better job here. We are not perfect, and we make a lot of mistakes and people share across the services more than 1 billion pieces of content a day. So if we make a mistake on a small percent, it is a lot of mistakes in both directions and things that should not be taken down that are taken down, and things that we missed that we should have gotten to. It is a constant effort to do verify the stateoftheart technology to improve, and certainly the state of the a. I. To develop Different Things is so much better than five years ago, but these are, and this is really hard stuff. Even if you are assuming for example that the photo that you are saying would have been against the policies, even within that, we have nuances in the policies that you might be allowed to share it if you are condemning it which of course seems important. If there is a racist attack, you would want people to share a video condemning it, but not condemning it of the same attack to glorify it and encouraging others to copy it. That is nuanced and linguistic analysis, and we operate in more than 100 countries around the world and this is one of the areas that has been hard for us to execute as well as i think that you and i would like us to, but we are improving, and i have taken this area seriously. Thank you. Recently, facebook has taken this step further by permitting the politicians to violate their community standards. Mr. Zuckerberg, why should the politicians who lead our country be held to a lower standard for truthfulness and decency than the average american . This is not about helping the politicians. This is about making sure that people can see for themselves what politicians are doing. But mr. Zuckerberg, it is hate speech. It is hate, and it is leading to violence and Death Threats in my office. And it is untruthful, and there people who are working on it, right, on your team, but if it is leading to actual real violence towards people who are innocent, and not only untruthful statements, but again, it is a dark time in the country, and we need to be able to play a part in reducing the violence. Chairman, chairwoman, may i add some context on that . I am sorry that the time has expired and we have people waiting. Thank you. We would like for you to answer in writing though any questions that you have not answered. The gentleman mr. Rose is recognized for five minutes. Thank you, and mr. Zuckerberg, thank you for being here today. As i have listened to the questions and the testimony today, i am reminded from a great quote from an entrepren r entrepreneurentrepreneu entrepreneurer of my state who say people will forgive you for anything before you are successful. So i know that you face criticism because of the platform that you have built and the success that you is had. Facebook is still today a brand that is synonymous with the social media and not necessarily known otherwise. So mr. Zuckerberg, there are still many Unanswered Questions about the libra project, and i can appreciate how you and your team have tried to convey your intent to work with regulators before fully launching calibra and i applaud you for releasing the libra white paper in june, but i am trained as a lawyer, and so it does raise concern to me that the white paper is still to this day is not dated or versioned in any way, so before i get into the deeper comments, i would wonder if that is something that you could address so that as time goes on, we could have that as a Reference Point as we look back. Congressman, that is good feedback and as i have said a number of times today, i dont control the Libra Association, but i would personally agree what you have suggested is a good addition. Okay. Today, facebook carries with it some reputational risks and from your testimony today, i know that you carry, and the riskric distrust that some of my colleagues face in the Financial Services industry, and how do you plan to launch libra and calibra and have Consumers Trust the technology, because though it is documented, calibra is still a subsidiary of facebook and for better or worse, even though there is a concourkocons the players launching facebook, that is the name that most people are still looking at the new financial instrument, and so how are you going to launch libra and calibra in a way that consumers will trust the technology. Congressman, a big part of it is the Regulatory Framework in place, and earlier in the year, i wrote an oped calling for clear rules for the internet and outside of this area, where there is quite clear rules and in a number of the areas that we have talked about today including what more guidance on the electoral advertising and some of the things that we have to do there as well as privacy and the data portability, and, you know, i think that we are in a moment where too many important decisions are being made by these big internet companies, and i certainly feel this myself. I feel like we are making too many important decisions about speech, and think that we would be better off if we had a clearer democratic process and rules about this, but in the area of the Financial Services, there is or are already some quite clear regulation, and that means that people dont just need to trust what any Given Company is doing, because they know that the government and the clear rule would have been democratically established are being followed. Thank you. There is tremendous work left to be left to do from the reputational standpoint from you and i wonder how successful libra and calibra is going to be while facebook is still gaining the reputational footing. You have work cut out for you, frankly. And like many of my colleagues today, i have security concerns about the cryptocurrencies and especially how the bad actors like the terrorist groups and other networks would use the products. I would like to ask you about thecerberuskyber risks and what go wrong, and if you are hacked who is going to be liable . It is where the Security Breach is. If it is in our services, we are liable, and if it is in another part of the libra service, it is maybe somebody else, but this is what the regulators would review, and create Financial Stability or other types of concerns that we have talked about today. This is part of why i am committed to making sure that we dont ship anything, any service here until we have clearance from all of the appropriate u. S. Regulators. Thank you, mr. Zuckerberg, and as that process continues, i hope that you will not exclude congress where and when it is appropriate for us to revisit some of the Regulatory Framework. Thank you and i yield back. The gentle lady from california, ms. Porter is recognized for five minutes. Chairwoman, we have a break after this round . After this next five minutes maybe. I am just up here drinking a lot of water. Thank you very much. If we will start the clock over. We are going to allow ms. Porter to start her questioning, and then we will break right after that. I understand there is a vote, so i wanted to know what is happening with the vote as soon as she finishes. All right. Lets go. Mr. Zuckerberg, as you know facebook can be sometimes an unkind place both toward my personal appearance and today apparently toward your haircut, but as the mother of a teenaged boy, i would like to say, thank you for modeling the shortcut. You have said, quote, we have a responsibility to protect our data and if we cant, then we dont deserve to serve you. Do you remember that statement . Congresswoman, yes. And the facebook privacy principles say that we give you control of your privacy and you can control and delete your information and three, we are accountable. Today, can you affirm that facebook cares about the user privacy and still holds itself to the standards that it articulates in the public poli y polici policies . Congresswoman, we certainly care about privacy and it is incredibly important to people. Super. If that is true, that you care bt t about the privacy and adhering to the principles and why are you arguing in federal court, consumers can not hold you liable for any of the promises, because as quote, the plaintiffs admit that they and every facebook member is bound by the terms of the services that release facebook from the contract and common law claims . Congresswoman, i am not specific with that specific legal argument. Well, it is right there for you. You are arguing in federal court in a Consumer Data Privacy lawsuit in which your own law r lawyers admit that information was stolen that they have, the plaintiffs failed to articulate any injury, and no harm, no foul, and facebook messed up, buzz but it doesnt matter. Is that your position . Congresswoman, i am not familiar with the context here and im not a lawyer, so it is hard for me to weigh in on the specifics. Mr. Zuckerberg, as the ceo, and the tremendously proportional shareholder of facebook, you are responsible for the legal arguments that your company makes. You hire these lawyers and will you commit to withdrawing this argument and this pleading and never again plead that there is no liability on facebook when data breaches occur . Congresswoman, you are certainly right that i am ceo and im responsible for everything that happens in the company, but all that i am saying is that i imagine that there are more pages to the document i will take that as a no for right now, but i would like for you to consider it, because your pleading is inkons sconsistent the hypocrisy and i so have been here and lost count in ten months since i have been here who have said one thing in that chair and another in court. And so, facebook is a great place to work, and pingpong tables and great benefits, but facebook does not use the place for the hardest place, and you have contractors watching the murders and grabbings and gruesome content to monitor content . I believe that is correct. And you pay many of the workers under 30,000 a year and cut them off of Mental Health care even if they have ptsd they incurred while working at your company. I understand that we are paying everybody including the contractors at least a 15 minimum wage, and in the markets of the cost of living that is a 20 an hour and reclaiming my time. According to one report that i have and this is straight out of the episode of black mirror this is the workers getting 9. 9 minutes per day. And this is nine minutes in the stairwell to cry while somebody else watches them. Would you be willing to commit to spending one hour a day for the next year watching these videos and acting as a content monitor and only accessing the same benefits available to your workers . Congresswoman, we work hard to make sure that we give benefits to all of the folks who are doing this i am reclaiming my time, and i would appreciate a yes or no, would you be willing to act as content monitor to have that experience . It would not best serve my community, but i spend a lot of time on this content. So mr. Zuckerberg, are you saying that you are not qualified to be a content monitor . No, that is not what i sa saying. So i would say that i would. And so, how many lobbyists do you have i am 60. You may respond in writing. My time is expired. The committee is going to recess for five minutes. [ recess ] from what we hear, taking a break in this hear. The purpose of the hearing was to discuss the facebook plan to create a cryptocurrency called libra and the possible impact that could have on the financial and housing markets. Mr. Zuckerberg also is getting questions on fake news pages, online advertising, facebook using users data and media censorship. Expecting this to come back together in a few minutes. Since this is running long, we did have plans to cover a hearing on u. S. Policy towards syria but instead you can watch that online at cspan. Org. Members, members, as soon as we as soon as we are finished with the fiveminute recess or should they go now . Members, you may go to the floor now. Theyve called a vote. I understand there are two votes and then please return back to the committee as soon as the last vote is taken. Again, just taking a break in this hearing. Were bringing you live coverage of Mark Zuckerberg before the house Financial Services committee. We heard the chair say she was going to let members head to the house floor to vote. There are two votes going right now on election security. You can find that on cspan. Were planning on bringing you a hearing on u. S. Policy toward syria but because of the ongoing hearing on facebook, you can find the syria hearing on line at cspan. Org. While we are in a break here on the facebook hearing, well take a look at some of the president s remarks from earlier today about syria. Thank you very much. My fellow americans, i greet you this morning from the white house. Over the last five days, you have seen that a ceasefire that we established along syrias border has held and held very well beyond most expectations. Early this morning, the government of turkey informed my administration that they would be stopping combat and their offensive in syria and making the ceasefire permanent and it will indeed be permanent. However, you would also define the word permanent in that part of the world somewhat questionable. But i do believe it will be permanent. Ive therefore instructed the secretary of the treasury to lift all sanctions imposed on october 14th in response to turkeys original offensive, moves against the kurds in syrias northeast border region. The sanctions will be lifted unless something happens ha were not happy with. This was an outcome created by us, the United States, to other nation, very simple and were willing to take blame and credit. This is something theyve been trying to do for many, many decades. Since then, others have come out to help and we welcome them to do so. Other countries have stepped forward, they want to help, and we think thats great. The nations in the region must take on the responsibility of helping turkey and syria police their border. We want other nations to get involved. Weve secured the oil and therefore a small number of u. S. Troops will remain in the area where they have the oil and were going to be protecting it and will be deciding what were going to do with it in the future. In any event, by the moves that weve made, were achieving a much more peaceful and stable area between turkey and syria including a 20mile wide safe zone. An interesting term. Safe zone, thats the term were using. Hopefully that zone will become safe. Thousands and thousands of people have been killed in that zone over the years. But its been sought for many, many decades and i think we have something thats going to be strong and hold up. Turkey, syria, and all forms of the kurds have been fighting for centuries. We have done them a Great Service and weve done a great job for all of them and now were getting out. Long time. We were supposed to be there for 30 days, that was almost ten years ago. So were there for 30 days and now were leaving, it was supposed to be a very quick hit and lets get out and it was a quick hit expect they stayed for almost ten years. Let someone else fight over this long, bloodstained sand. I want to thank Vice President pence and secretary of state pompeo for leading the american delegation so successfully to turkey. Several days ago, along with National Security adviser obrien, i want to thank them very much. The american delegation negotiated the original fiveday ceasefire that ended kurdish fighters to safely leave. It got them to a point where frankly they were able it enabled them to get out, to go, and move really just a few miles in a slightly different direction. So this enabled them to do so. Countless lives are now being saved as a result of our negotiation with turkey, an outcome reached without spilling one drop of american blood. No injuries. Nobody shot. Nobody killed. I have just spoken to general mazloum. The commander in chief of the sdf kurds and he was thankful for what the United States has done. Could not have been more thankful. General mazloum has assured me that isis is under very, very strict lock and key and the detention facilities are being strongly maintained. There were a few that got out, a small number, relatively speaking, and theyve been largely recaptured. Im also sure that he will be issuing his own statement for shortly. We had a great talk but we saved the lives of many, many kurds. He understands that. The war was going to be vicious and probably not very long and im very happy to have been involved in it as are our Vice President , our secretary of state, and all of the other people on our team by getting that ceasefire to stick. Weve done something thats very, very special. But by getting the ceasefire after a tremendous amount of really tough war for a very short period of days, that is something very special. Our troops are safe and the pain and suffering of the threeday fight that occurred was directly responsible for our ability to make an agreement with turkey and the kurds that could never have been made without this shortterm outburst. Should turkey fail to honor its obligations including the protection of religious and ethnic minorities which i truly believe they will do, we deserve the right to observe crippling sanctions. We are now an economic powerhouse like never before and very importantly like no other. Our economic might is stronger than its ever been and our competitors are not doing very well. We also expect turkey to abide by its commitment regarding isis as a backup to the kurds watching over them should something happen, turkey is there to grab them. Further we implore European Countries to come and take those fighters that the u. S. Captured and bring them back to their countries for incorrespondence rati incarceration and trial. Europe has been very unresponsive in doing what she should have been doing for a long time. Now is their chance to finally act. American forces defeated 100 of the isis caliphate during the last two years. We thank the Syrian Democratic forces for their sacrifices in this effort. Now turkey, syria and others in the region must work to ensure that isis does not regain any territory. Its their neighborhood. They have to maintain it. They have to take care of it. There were some political pundits who responded to turkeys offensive in syria by calling for yet another American Military intervention. I dont think so. But halting the incursion by military force would have required deploying tens of thousands of american troops against turkey, a nato ally, and a country the United States has developed a very Good Relationship with, including president erdogan. The same people that i watched and read giving me and the United States advice were the people that i have been watching and reading for many years. They are the ones that got us into the middle east mess. But never had the vision or the encourage to get us out. They just talk