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California’s Landmark Privacy Law is Facebook’s Next ‘Nightmare’

Facebook-managed political action committees and “issue advocacy” organizations are becoming major threats to public disclosure of campaign spending, even those where the publicly disclosed sources of corporate giving are not previously known.

An analysis of FEC records by the Institute for Free Speech examined hundreds of comments filed with the FEC last year by Facebook who were seeking exemptions from a new California law limiting corporations’ electioneering. The analysis found that 23 percent of the comments requested that information be classified as “sensitive” or “trade secrets” so that the public could not see the sources of companies’ political spending.

Four themes were emerging:

Facebook asked the FEC to censor reviews of its post-election statements made under SEC rules so that those statements could not be seen by the public. Facebook asked for exemptions from meeting disclosure requirements which allow candidates and their supporters to review the most recent communications from outside groups after an election. Facebook and other tech companies asked that information be exempted so that the public could not see the difference between “issue” and “electioneering communications” that are bought and paid for by the candidate and their supporters, but not the source of corporate contributions, so there would be no accountability for the choice of issue messages. Facebook and other technology companies sought exemptions from disclosure requirements that allow candidates and their supporters to review the most recent communications from outside groups after an election. Facebook and other tech companies requested that information be exempted so that the public could not see the difference between “issue” and “electioneering communications” that are bought and paid for by the candidate and their supporters, but not the source of corporate contributions, so there would be no accountability for the choice of issue messages. Facebook and other technology companies requested that information be exempted so that the public could not see the difference between “issue” and “electioneering communications” that are bought and paid for by the candidate and their supporters, but not the source of corporate contributions, so there would be no accountability for the choice of issue messages.

Facebook and other tech companies have significant influence over local and state elections in ways that cannot be ignored. They are almost never disclosed as making campaign contributions. Californians already know where Facebook and other companies’ search results and news pages originate, but with the emergence of issue advocacy groups, Californians can no longer feel safe about knowing where Facebook is putting its bucks. Facebook wants to use the public disclosure rule to study whether its statement supports and explains the position it takes in the political arena. Once it concludes it does not, it will take that information out of the public record. That could be the tip of the iceberg.

Prior to this data breach of public records, the Irvine, California-based nonpartisan institute had already noted that Facebook has reduced the disclosure requirements of its own website to what should be public information:

Note the explicit exceptions for even being “political” (when plainly political), being related to a trade, not being coordinated with the candidate’s campaign, and having the candidate’s contact information. It is already known what was revealed in California: that Facebook Inc. spent well over $80 million on political campaigns in 2017 (and that, unlike other internet providers, does not include ad spend from third parties like Super PACs). Their 2018 disclosures are being furtively withdrawn by Facebook Inc. from political disclosure laws in California, Georgia, Kansas, Michigan, and elsewhere, but the state laws force Facebook to disclose their financial and other information, including the source of funds. Facebook told us: “Facebook believes that all information should be made public; however, the California law contains requirements that, when interpreted in light of long-standing industry practice, are inconsistent with the common sense guidelines. The long-standing industry practice is to separate commercial and political expenditures. As a result, Facebook believes that only commercial expenditures are potentially subject to disclosure under this law.” And that is simply not true. Google Inc. had identical concerns about disclosure requirements, but it kept the California disclosure law on the books.

Most people don’t even know where Facebook gets its ads from, but the open records laws require that these companies disclose what the source of their funds is. That’s why the Open Society Foundations, a nonprofit organization that advocates for openness and transparency, has been fighting Facebook on this issue for a number of years.

Facebook (and its allies in Silicon Valley) is attempting to dictate what information Californians can see about where the cash is coming from in election debates. They have completely changed the rules for disclosure, and Facebook’s actions before and after California Gov. Gavin Newsom signed the “sunshine reform” bill into law have just ratcheted up the pressure on that reform to go no further.

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