A call to arms to rethink social media
Just in: The U.S. surgeon general, Vivek Murthy, called for a warning label for social media platforms in a Times Guest Essay, advising parents that the technology may be helping fuel a mental health crisis among adolescents.
It’s the latest effort by regulators to impose restrictions on social networks — particularly over their effects on children and teens — and is a reminder of the increasing scrutiny of global tech giants.
Such a label would be similar to those placed on cigarettes and alcohol products. In his guest essay, Murthy writes that the issue has become an emergency:
Why is it that we have failed to respond to the harms of social media when they are no less urgent or widespread than those posed by unsafe cars, planes or food? These harms are not a failure of willpower and parenting; they are the consequence of unleashing powerful technology without adequate safety measures, transparency or accountability.
Scrutiny of social media’s effects on teenagers has grown in recent years. The social psychologist Jonathan Haidt describes the 2007 release of the iPhone as an inflection point, with suicidal behavior and reports of despair among adolescents rising sharply since. (Other experts question such a link and point to other factors like economic hardship.)
Warning labels have succeeded in changing the public’s behavior before, with smoking in the U.S. declining sharply in the five decades since one was required for cigarette products.
Murthy acknowledged that Congress needs to get involved. A warning label would require their approval. He also urged lawmakers to pass measures that shield young people from online harassment, abuse and exploitation.
Murthy also recommended preventing platforms from collecting children’s sensitive data and restricting the use of features like push notifications and autoplay that encourage excessive use.
It’s the latest push to check the power of social media around the world. States have sued Meta and other companies over features that regulators say are addicting children, and some have passed legislation that seeks to shield young people from any negative effects of social media. And while a law enacted in April to force the sale of TikTok by its Chinese owner was focused on national security concerns, it also warned about the video app’s effect on young people.
Meanwhile, European Union regulations require social media users be at least 16 to have their personal data processed without parental consent.
Tech companies say they’ve been working to better protect teens. Meta, for instance, has said that platforms should be given time to work with watchdogs to “create clear, age-appropriate standards for the many apps teens use.” Yet as Murthy’s call shows, those efforts haven’t been enough to allay the concerns of governments and parents.
HERE’S WHAT’S HAPPENING
Central banks and economic data are in focus this week. Chinese data released on Monday showed that industrial output and the property sector slowed last month, despite a better-than-expected uptick in consumer spending. Wall Street will be closely watching the U.S. retail sales report on Tuesday for what it says about the strength of consumer purchasing power and progress on inflation. On Thursday, it’s decision day on interest rates for the Bank of England and Swiss National Bank.
Prime Minister Benjamin Netanyahu dissolves Israel’s war cabinet. Netanyahu made the decision after two of its five members quit last week in protest of his handling of the war in Gaza. The move came as the military warned of a widening conflict with Hezbollah, the Iran-backed militia in Lebanon, and aid groups called for Israel to do more to alleviate a humanitarian crisis in the Palestinian territory.
OpenAI reportedly weighs becoming a for-profit company. Sam Altman, OpenAI’s C.E.O., has told some shareholders that the artificial intelligence start-up could be restructured so that its nonprofit board doesn’t control the business, according to The Information. Such a move could make it easier for OpenAI to pursue an initial public offering.
What’s Plan B for The Washington Post?
New revelations about The Washington Post’s C.E.O., Will Lewis, are threatening to fuel an increasingly public fight between him and his newsroom. Two reports published over the weekend unearthed new allegations about journalistic practices that he and his pick to lead the newspaper, Robert Winnett, employed two decades ago in London.
The articles fueled more speculation about how much support Lewis enjoys from Jeff Bezos, The Post’s owner, as the paper has lost tens of millions and shed readers under its previous leadership. But they also focused on events that are now two decades old. It’s clear that the knives are out for Lewis, who is seeking to radically reshape The Post’s management and newsroom — and raises questions about what the paper could do to fix itself if he goes.
What’s new: The Times and The Post reported that in previous roles at British publications, both men employed phone hacking and deception:
Lewis commissioned a 2004 article about a British C.E.O. at The Sunday Times when he was an editor there that was based on hacked records, the report’s author told The Times. A Post spokeswoman said that Lewis declined to answer a list of questions from The Times.
Winnett wrote an article for The Sunday Times in 2002 about buyers of the then-new Maybach luxury car, which the paper called the “Nazis’ favorite limousine.” A private investigator later admitted publicly that he obtained information for the article via “blagging,” or using misinformation to obtain confidential information, The Times and The Post reported. Winnett did not respond to a request for comment from The Times.
What does Bezos think? He recently expressed support for Lewis amid a public clash with The Post’s now-former executive editor, Sally Buzbee, though that was before the latest articles were published, The Times reported. Some media watchers have said that the uproar over Lewis is in part rooted in disagreements between American and British journalistic practices.
Bezos has backed Lewis’s strategy to split The Post’s newsroom into one focused on traditional coverage and one centered on service journalism and social media. Whether the latest revelations are enough to erode his backing of Lewis is unclear.
What happens if Lewis is shown the door? He has said that The Post has lost $77 million since 2023 and that its audience has halved since the 2020 presidential election.
Bezos has said publicly that The Post can’t lose money indefinitely — “This is not a philanthropic endeavor,” he said at a journalism conference in 2017 — and has been involved in the paper’s budgets and weighed in on business matters. That suggests that even if Lewis were to go, The Post’s owner would still seek big changes in how the company is run.
“Of all the climate-related work I’m doing, I’d say the one that has the most bipartisan energy behind it is actually this nuclear work.”
— Bill Gates. The Microsoft co-founder has invested billions in nuclear energy and said he’s prepared to invest “billions more” to help meet the country’s booming electricity needs.
“We have to leave France”
French equities rebounded slightly on Monday, but global investors remain on high alert as political turmoil grips the country less than six weeks before the Paris Olympics.
The country’s parliamentary election campaign kicks off Monday. President Emmanuel Macron’s stunning decision to call snap elections last week rocked European markets, with polls showing that the far right is leading, Vivienne Walt reports for DealBook.
The shock waves haven’t let up: “Worry and uncertainty spread to the financial world,” blazed on Monday’s front-page headline in Les Echos, the country’s top financial daily, after huge protest marches in Paris this weekend.
To recap: Macron called for legislative elections after the far right hammered his centrist party in elections for the European Parliament. But his decision caused investors to flee the world’s seventh-largest economy and sent repercussions across Europe. The euro tumbled, billions were wiped off French and European stock markets, and the gap between French and German government bond yields — a key indicator of Europe’s stability — grew last week at the fastest rate since Europe’s sovereign debt crisis in 2012.
All of that comes as Germany, the continent’s biggest economy, is facing its own political crisis that could cause its coalition government to split.
The European Central Bank is in a tough spot. A weak euro could derail the central bank’s efforts to ease borrowing costs further, analysts say. Christine Lagarde, the E.C.B. president, deflected questions about the French election last week. As head of the I.M.F. during the Greek debt crisis, Lagarde had a front-row seat when the European economy was on the brink.
Tensions are rising. Many investors and business leaders aren’t waiting for the vote’s outcome next month. “Many of my clients, companies, tell me, ‘We have to leave France,’ ” Marc Touati, chief economist for the Paris investment advisers ACDEFI, told DealBook. “It is the beginning of a panic.”
The campaign promises could be bad for business. The far right wants to lower the retirement age to 60, halve sales taxes on utilities and food, and raise the minimum wage. One estimate says that could cost about 101 billion euros. Left wing parties plan to halt infrastructure spending and reinstate a wealth tax that Macron abolished in 2017 — a measure some believe helped attract billions in foreign investment.
Anxiety could also bring bargains to investors. “Fear is an opportunity,” said Alberto Gallo, chief investment officer at Andromeda Capital Management. “When we see investors from outside of Europe worrying about a euro exit, or about extreme situations, we get very excited,” he told DealBook.
THE SPEED READ
Deals
The activist investor Starboard Value has reportedly taken a $500 million stake in Autodesk and has raised questions about accounting issues and the software company’s strategy. (WSJ)
Fisher Investments, the money management firm run by the billionaire Ken Fisher, sold a stake to Advent International and an arm of Abu Dhabi’s sovereign wealth fund at a $12.75 billion valuation. (Bloomberg)
Elections, politics and policy
President Biden raised a record $28 million at a Hollywood event as his campaign sharpens its attacks on Donald Trump after his felony conviction. (NYT)
Donald Trump’s plan to exempt tips from taxes could add up to $250 billion to the federal deficit over 10 years. (Bloomberg)
Best of the rest
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