Social Media Stocks Slip As Trump Issues Executive Order

Social media stocks slipped yesterday after President Trump signed an executive order granting the government broader authority to crack down on social media companies. Twitter fell 4.45%, Facebook dipped 1.61% and Google’s parent company Alphabet dropped 0.08%. Twitter took the biggest hit because Trump said if the company doesn't operate honorably, he hinted he would consider shutting the company down.

Trump says social media companies have gained “unchecked power” and have taken on the roles of editors and publishers of the content on their websites. His executive order would remove their “liability shield” if they engage in censorship.

What is Section 230?

Section 230 allows tech companies to moderate user-generated content on their site without becoming legally liable for it as a publisher typically would.

The law allows companies to engage in “good Samaritan” moderation of “objectionable” material. This, then, comes without the companies receiving a publisher or speaker treatment. Section 230 allows platforms like Twitter, Facebook and Google’s YouTube to take down terrorist content. It also allows them to track and take down harassing messages while still enjoying other legal protections.

What the law doesn’t allow, and what Trump says the platforms are doing, pertains to selectively moderating what messages users see to silence conservative voices.

“They’re doing things incorrectly, they have points of view,” Trump said at the White House. “My executive order calls for new regulations under Section 230 of the Communications Decency Act to make it that social media companies that engage in censoring or any political conduct will not be able to keep their liability shield. That’s a big deal,” he also stated.

Trump's Order

Trump said the order would also prevent taxpayer dollars from going to any company that engages in what Trump referred to as deceptiveness. This is in addition to limiting these protections for companies that acted with bias.

Trump’s executive order comes just days after Twitter added a fact-checking feature. The social media site added the new feature alongside two of the President’s tweets about mail-in ballots and fraud. After Twitter added the fact-checking features, Trump then accused the company of engaging in “political activism.”

He also tweeted, “So ridiculous to see Twitter trying to make the case that Mail-In Ballots are not subject to FRAUD. How stupid, there are examples, & cases, all over the place. Our election process will become badly tainted & a laughingstock all over the World. Tell that to your hater @yoyoel.”

“Big Tech is doing everything in their very considerable power to CENSOR in advance of the 2020 Election,” the president also said Wednesday night — on Twitter. “If that happens, we no longer have our freedom. I will never let it happen! They tried hard in 2016, and lost. Now they are going absolutely CRAZY. Stay Tuned!!!” he then added.

Reactions

Facebook CEO Mark Zuckerberg said that his company is taking a different approach to moderating content on his social media platform.

“I just believe strongly that Facebook shouldn't be the arbiter of truth of everything that people say online. Private companies probably shouldn't be, especially these platform companies, shouldn't be in the position of doing that.”

The interest in updating Section 230 to remove the liability shield for publishers isn’t just a goal for Republicans. It actually has bipartisan support.

This past January, Democratic nominee Joe Biden proposed revoking Section 230 completely. “The idea that it’s a tech company is that Section 230 should be revoked, immediately should be revoked, number one. For Zuckerberg and other platforms. It should be revoked because it is not merely an internet company. It is propagating falsehoods they know to be false.” Biden also never responded to follow-up questions about this statement.

Even former Democratic candidate also Bernie Sanders supported the idea, adding, “Tech giants and online platforms should not be shielded from responsibility when they knowingly allow content on their platforms that promotes and facilitates violence.”

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