Photo Credit: Kirill Kudryavtsev, Agence France De Presse
I have never met Mark Zuckerberg, nor do I have any experience hearing him speak in public forums. I have followed his business (Nasdaq: META) over the years, and so I will start there. For the year ending 12/31/2024, Meta’s revenues were $164 billion, up 21% from 2023 revenues of $135 billion. Operating income in 2024 was a very healthy $69 billion (42% operating margin), and operating income increased 47% over the 2023 level.
2024 net income of $62 billion increased by 59% over 2023 net income. These are eye watering numbers. Investment in wearables like visors and smart glasses is huge, and cap ex is all funded out of cash from operations.. Numbers for daily active members increased and numbers for engagement on the platforms have also increased.
META is a dual share class company, with Mr. Zuckerberg holding all of the super voting shares, which cast ten votes per share compared to one vote per share for the common shareholders. Even if fifty percent of the common shareholders voted for a proposal which the founder didn’t like, Mr. Zuckerberg’s preferences would still carry the day. With this equity capital structure, Mr. Zuckerberg doesn’t have to curry favor with pesky activists from Blackrock to Pershing Square, for example.
One source noted that Mark Zuckerberg made a $2 million plus contribution to the Harris campaign during the last election cycle; Chan Zuckerberg, his wife, is her own person also and donates to candidate support activities on the Democratic side. With two young children, I suspect that Mr. Zuckerberg has matured quite a bit as a corporate leader from the days of nerdy barbecues with his inner circle. I don’t believe that he has any need or desire to curry favor with any presidential administration.
That is not to say that he doesn’t have any opinions, or that he is oblivious to threats to his business, but these would have to be colossal. They were, and it was during the Biden administration, when he cited government control and regulation of Facebook’s platform as being “an existential threat” to his business.
It’s All in the Court Documents
Case No. 3:22-cv-1213-TAD-KDM Document 29326792, Filed 07/04/23, Page 1-155, State of Missouri v Biden, US District Court, Eastern District of Louisiana, Monroe Division. Judge Terry A. Doughty [The case has been renamed, and document citation may have changed.]
The case exhibits show the point man for communications between Facebook executives and the Biden administration was Rob Flaherty. At the time, he was Assistant to President Biden and Director of Digital Strategy, before leaving to become Deputy Campaign Manager for Biden’s reelection campaign. Mr. Flaherty’s degree was in TV/Radio and Politics. Mr. Flaherty became the Biden administration rottweiler assigned to make demands, give deadlines for compliance, wheedle, and threaten officers of Twitter, Facebook, YouTube, and others. We will focus on Facebook, because of the subject of this Substack.
Having had firsthand executive experience with corporate disclosures, communications, and securities laws, I wonder who from the Facebook side might be engaging with Mr. Flaherty, and it’s clear that many people were involved. The corporate counsel had to monitor these communications in some way, as promises were being made which bound the corporation, as the court transcripts show. Some high level executive officer also should have been party to the communications as well; in many cases Facebook is forced into going against the corporate policies of their own platforms, and user agreements which I surmise never made reference to the government-coerced reductions in services, e.g., some posts sent to mailing lists only going out to one or two names ; users are unlikely to have agreed to their private posts and associated user information being shared with random officials in the White House. These is an ethical question minimally, and disclosure issues if one were strict about these practices.
Here are a few examples:
· “On February 9,2021, Flaherty followed up with Facebook with regard to its COVID-19 policy, accusing Facebook of causing ‘political violence’ spurred by Facebook groups failing to censor false COVID-19 claims…Facebook responded the same day and stated that ‘vaccine skeptical content’ did not violate Facebook’s policies. However, Facebook stated that it will have the content’s distribution’ reduced and strong warning labels added ‘so fewer people will see the post. In other words, even though ‘vaccine skeptical content’ did not violate Facebook’s policy, the content’s distribution was still being reduced by Facebook.”
Note that millions had good reasons to be skeptical about the government’s aggressive position embracing the miRNA vaccines without hesitation, e.g. the government was discussing revenue sharing with Moderna, the vaccine came to users through emergency use authorization and not by definitive two-arm studies with follow-up showing efficacy and safety, and it was not a vaccine which conferred immunity from COVID like polio and measles, which were familiar to most Americans. Holding an independent opinion which differed from that of the government was apparently forbidden. This is a violation of our fundamental right of freedom of speech.
“From May 28, 2021 to July 10, 2021, a senior Meta executive (likely Sir Nicholas Clegg, Meta President of Global Affairs and a British and European parliamentarian) copied Andrew Slavitt former White House Senior COVID-19 Advisor, on his emails to Surgeon General Murthy alerting them that Meta was engaging in censorship of COVID-19 misinformation according to the White House’s ‘requests’ and indicating ‘expanded penalties’ for individual Facebook accounts that share misinformation. Meta also stated, ‘We think that there is more that we can do in partnership with you and your team to drive behavior.”
Zuckerberg Doesn’t See Meta as a Government Stooge
Quoted in the Wall Street Journal, Mr. Zuckerberg said, “We are going to get back to our roots and focus on reducing mistakes, simplifying our policies and restoring free expression on our platforms.” Fact checkers are being eliminated, which is good. During the height of “vaccine hesitancy” and “misinformation,” green ribboned fact checkers were alleging false claims by established medical and scientific authorities like Dr. Jay Bhattacharya, Dr. Sunetra Gupta ,and Dr. Martin Kulldorff of the Great Barrington Declaration. The fact checkers didn’t have to provide any evidence for their opinions, and when I looked into their backgrounds I saw no relevant experience or expertise. As I always tell my readers, don’t rely on reporters or other media to dig into questions, as they themselves are narrowly informed and always have an axe to grind. . Look into important issues for yourself through the source material, where possible,
The same rather loopy Wall Street Journal article ascribes all these recent changes to a rightward political shift by Mark Zuckerberg and to his desire to cozy up to the Trump administration. Given the financial strength and stellar growth of Meta’s businesses, I don’t see any economic gain from such a shift. After offering to become a partner to the Biden administration, all Meta got were irrational brickbats and a sullied corporate brand.
Lest We Forget: The Big Issue Is Still Before Us
Judge Terry A. Doughty writing in Missouri v Biden:
“Although the COVID-19 pandemic was a terrible tragedy, Plaintiffs assert that it is still not a reason to lessen civil liberties guaranteed by our Constitution. “If human nature and history teaches anything, it is that civil liberties face grave risks when governments proclaim indefinite states of emergency.” Does 1-3 v. Mills, 142 S. Ct. 17, 20–21 (2021) (Gorsuch, J., dissenting). The “grave risk” here is arguably the most massive attack against free speech in United States history.