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Full Transcript: Facebook COO Sheryl Sandberg On Protecting User Data

Facebook has been under fire in recent weeks after it was revealed that Cambridge Analytica gained access to millions of users’ data while working for President Trump’s 2016 campaign. Facebook founder and CEO Mark Zuckerberg is expected to testify before Congress early next week.

In an interview Thursday, Sheryl Sandberg, the social network’s chief operating officer tells NPR’s Steve Inskeep about the company’s missteps, and what it’s doing to correct them, and the information being provided to affected users.

Inskeep: I know your time is short, so I’ll dive right in. Thanks for doing this, it’s great to meet you in person.

Sandberg: I’m really glad to have you.

I want people to know that you have been credited with being part of the reason that Facebook is so profitable. This is a story that’s told about you — that the company was popular before you came, that it became much more profitable afterward. Have the events of the last year or two, though, shown that the business model of this company is part of the problem?

I’m going to take a step back and talk about what the problem is, and then get to the business model, because you’re asking a really important question. We know that we did not do enough to protect people’s data. I’m really sorry for that, Mark’s really sorry for that. And what we’re doing now is taking really firm action.

Starting Monday we’re going to start rolling out to everyone in the world, right on the top of their news feed, a place where you can see all the apps you’ve shared your data with and a really easy way to delete them. We’re being much more restrictive, in the data apps are going to have access to. And just yesterday we announced further steps shutting down data access points in groups and events and pages, and search. And so we are in a process that is evaluating all the ways data is used.

It’s going to be long — it took us a long time to get here, it’s going to take a long time to find all of this — but it’s also going to be ongoing. Because safety and security is never done, it’s an arms race. You build something, someone tries to abuse it, you build something. And so the commitment we have is that we have a new approach to not just protecting sharing, but also on privacy.

Then you asked about the business model. And on the business model we have an ads-based business model, just like TV, just like radio. Our content’s available to anyone for free because it’s ad-supported. And that we feel really proud of, and we’re really — we think it’s really important. We’re trying to connect the whole world. Two billion people use our service; a lot of them would not be able to if they had to pay for the content itself.

And privacy and ads are not at odds. It’s a good opportunity to remind everyone what we say all the time, but we need to keep saying so people understand it — which is that we don’t sell data, period, and we don’t give any advertisers your personal information.

But let’s be clear: Part of the business is gathering enormous amounts of data about people, making use of it, and figuring out ways to monetize that. And that does make a lot of money and it may well serve a lot of people, but hasn’t it also led to some of the abuses we’ve seen in recent years.

Well the abuses we’ve been talking about have not been with ads — they’ve been with other products. But that doesn’t mean there haven’t been abuses in ads, and that doesn’t mean there won’t be, going forward.

So let’s talk kind of big-picture about what’s happened here. Right? Because the underlying question is, why are we where we are, why are we so slow, do we have control of this massive system? Those fair?

Go for it.

Those are fair questions, and I think those are real questions. So if you take a step back we had a very deep belief in what were social experiences that we would build — an ability for people all around the world to connect, and that people can have social experiences. [If] you and I are friends, we would know each other’s birthdays were, we were able to go to events together, we were able to share each other’s playlists, and a lot of good got done there.

But I think what we weren’t good enough at doing is thinking in advance about the ways misuse could happen on a platform. And when we found things — and we did find things — we shut down that thing. So the specific example in Cambridge Analytica, of friends-of-friends sharing, we shut down in 2015 that specific case.

But what’s different now is that we’re taking a much broader view and a much more proactive approach. A few weeks ago and the Cambridge Analytica thing happened, we made a commitment that we would go through and find data uses that were potentially too risky, or even ones we didn’t want to do. And we have been proactively bringing things to the surface, shutting things down, telling people and we’re going to continue to do that.

Let’s talk about what you discovered with Cambridge Analytica. Some people will know that you have disclosed this week that it was 87 million people whose information was shared. The overwhelming majority of them without having given explicit permission.

That’s not exactly right — let me let me explain. So in 2015 when Cambridge — when we received word that this researcher gave the data to Cambridge Analytica, they assured us it was deleted. We did not follow up and confirm, and that’s on us — and particularly once they were active in the election, we should have done that. And again that is on us.

What’s happening now is, we don’t know what if any data they still have or how much it was. We’re trying to do a forensic audit with them, but the UK government is doing theirs first and we had to stand down — they get priority. The 87 million is anyone who Cambridge Analytica might have accessed their data. We’re being super-conservative and careful. This is anyone who might have been connected, might have been connected to someone who connected to them

So you still don’t know what the number is.

We still don’t know.

Well let me ask if you know something else: Were there other firms, political or otherwise, who used data in the same way that Cambridge Analytica did?

We don’t know. What we announced when we talked about Cambridge Analytica, is we’re doing a thorough investigation and an audit. That is ongoing, and as we find those ,we’re going to notify people as we did with Cambridge Analytica. But we’re not just looking at apps — that would, you know, I think would have been what we would have done before — we have an app problem we look at apps. Now we’re looking much more broadly.

That’s why this week we shut down a number of use cases in other areas — in groups, in pages, in events — because those are other places where we haven’t necessarily found problems, but we think that we should be more protective of people’s data in a much more proactive way.

Talk to me as somebody who’s been on Facebook for more than a decade, though. I think about Cambridge Analytica, I think about the fact that this company that I had no idea about was gathering perhaps my data, or somebody that I know, and using it in ways I’d have no idea about. There’s an issue there with consent.

But even beyond consent, from the average person’s point of view, doesn’t Facebook and anybody who deals with Facebook essentially do the same thing Cambridge Analytica did? They gather lots of data about people and use them in ways that, whether we formally consent or not, we really don’t understand.

One of the things we’re very focused on is making sure you do understand how all of your information is used, and you do understand what information you’ve shared with Facebook.

We announced we’re rolling out privacy shortcuts. The controls have been there, and most have been there for a long time — but you’re right, they’re hard to understand and hard to find. So this is a very simple way to see where those controls, and control them, including ad preferences. We just updated something and made it easier — it’s been there for a long time — called “Download Your Information,” where you can look at every bit of information you’ve shared with Facebook.

And so you are right that the system’s been too hard for people to understand, and we’re taking very assertive steps to make it easier, simpler, clearer, so that the controls are in one place and people can take the steps they want to take.

But the business is still the same, right? You’re still going to have lots and lots of information about me, in ways that might make me uncomfortable.

Well we want you to know all the information we have about you, we want you to know all the controls we have, and we want to make sure you’re not uncomfortable.

So let’s talk about ads. On ads, we are able to show targeted ads to someone, which means something you might be interested in. We do that ourselves — and then we don’t pass any of your personal information to any advertiser, they just get aggregate reports. You can also opt out of different ways we use data. You can opt out of seeing ads from different advertisers through ads preferences.

And again, we do not sell data, ever.

One quick question then I want to move on a little bit here —

Can I? I just — I wanted to finish. This is important.

Please, please — go ahead.

One of the questions you might ask about the business models — why use data at all for ads? Why don’t we just show everyone in the U.S. the same ads? Then we could do it without any data

Oh, no, I understand why you do that.

But this is a really important thing — I think it’s really important for your listeners to understand, which is that, that’s why small businesses can participate in this. That if you just do big ads they go to everyone, only large advertisers can participate.

We have 6 million customers around the world — a lot in the U.S. Forty-two percent of the small businesses on Facebook in the U.S. are hiring because they’re growing on Facebook. And that’s creating the majority, small businesses create the majority of the job growth on Facebook. So the targeting — which we do in a privacy-safe way — is a big chunk of why small businesses are growing, and that’s why we think it’s so important. We can do it, and protect your privacy, but it’s part of what’s making small business — and our economy — grow.

One detail I want to check on then move on to a bigger thing: Regarding Cambridge Analytica, you said “we don’t know” if there were other political entities that used information in that way. Do you mean to say you do not at this time know of a single other company or firm that used data in that way?

We don’t even know what data they had or used. I don’t know what they did, so I don’t — we don’t know any others, because we don’t even know what they did.

I’m curious when you’re talking with Mark Zuckerberg or whoever else you may talk with around this company, have you had moments when you’ve asked the question, “are we as a company too powerful?”

It’s an important question — and people have that question about us and others, particularly as our size and scope. And we’ve had a lot of long and thoughtful conversations about what that means. We know that a lot of regulators have that question. We know that consumers around the world have that question —

Do you take it seriously or does it seem ridiculous to you?

Oh, we take it very seriously. We’ve always had a deep responsibility for people, but at our size and scope, with billions of people using our products, we have a very deep responsibility.

We’re having conversations with regulators around the world, but we’re not even waiting for regulation. The most likely regulation in the United States right now is the Honest Ads Act — which may or may not pass. We’re not waiting for it. We built a tool that shows every ad that any page is running on Facebook. It’s live in Canada. It will be live in the U.S. before the election.

And that’s really important because that law is about transparency. We’re not going to get dragged to doing it — we’re doing the transparency now, ahead of that law, whether or not it happens

Will your tool allow for something that some privacy advocates seem to want and advocate for, which is that people can simply opt out of having so much of their data saved and shared at all?

There are lots of ways to opt out of different data parts on Facebook — and again we are rolling up those controls putting them into privacy shortcuts. We’re also looking carefully at the GDPR legislation in Europe. And the majority of those controls and settings we are going to make available around the world — they’ll have slightly different formats because some of it’s specific to that law, but we are making those controls and settings available throughout the U.S. through this year as well.

We’ll make this clear: Europeans have different standards that in some ways would seem stronger than the United States’; you’re saying you’re going to follow them everywhere. Is that correct?

We’re gonna follow all the controls and settings. Not every exact one — I’ll give you one example where we wont: In Europe the age of consent is 16, here it’s 13. So that’s one difference. But the fundamental principle, and most of the controls — I can opt out of ads preferences, I can opt out of this form of ads targeting, I can opt out of using [third-party developers’ tool] Platform. Those we’re going to find a way, in a local way of people understand them, to roll out everywhere.

Given that the Federal Trade Commission reached a consent agreement with Facebook in 2011 to better protect people’s privacy, should you have taken these steps years ago?

Well we’re in constant conversation with the FTC, and that consent decree was important, and we’ve taken every step we know how to make sure we’re in accordance with it.

But the bigger answer is, should we have taken these steps years ago anyway? And the answer to that is yes. Like a very clear, a very firm, yes. We really believed in social experiences, we really believed in protecting privacy, but we were way too idealistic. We did not think enough about the abuse cases. And now we’re taking really firm steps across the board.

So let’s talk about another one that I’m sure is really important to the people listening: Let’s talk about election interference. Right? In 2016 the Russian Internet Research Association interfered in the election on our platform — and that was something we should have caught, we should have known about, we didn’t. Now we’ve learned.

Just this week we announced that we’ve taken down another 270 pages and accounts. They were in Russian, mostly, targeted at Russia. And our answer to that is, these are Russian troll farms, this is deception, and there’s no place for it on our platform or any other anywhere in the world. We’re not going show in Russia, we’re going to show the U.S. — and we’re looking for others. That was something we didn’t understand then, but we are focused on finding now.

Similarly in the recent Alabama election, the special Senate one, we found Macedonia scammers that looked to be financially motivated, that were going to put up what would have been fake information — and we got those down.

So we learn, we adjust, and we are very focused on making sure that we get this right going forward.

Are you prepared for the 2018 congressional elections, which are essentially upon us?

Yeah. We are doing everything we can to be prepared, and I can talk about some of those specific steps. Fake news — fake news is a really important part of what people are concerned about. We are really going after fake accounts. It turns out that a lot of people think of fake news as politically motivated, and a lot of it is — but even more of its financially motivated.

Sure.

People are trying to write outlandish headlines, right? Get you to click, make money. So we’ve made sure that we’ve taken them out of the ability to monetize on Facebook, taken them out of the ability to show ads and make money. That’s really important.

We’ve also done a lot more on fake news. We have a partnership now with the AP set up in all 50 states where we can quickly respond when something looks like it might be false. When something — we either find it which is new, we’re doing it proactively — looks false, or someone reports something to us as false, we’re relying on third-party fact-checkers.

And if they say it’s false we’re dramatically decreasing its distribution. We’re letting people know “this is false” right before they post it; if you already posted it, we’re going back and saying “you posted something our fact-checkers say is false, and we’re giving you alternative facts,” in the form of related articles right there.

We’re also asking people broadly, what news sources do you trust? And we’re going to show people more news from the news sources they trust as well as less news from others.

People say they trust The New York Times, they’ll get more New York Times, is that what you’re saying?

If people in the country broadly trust more The New York Times, they will see more from The New York Times.

Richard Blumenthal, Democratic senator, called upon Facebook to contact 126 million people who were believed to have been touched in some way by Russian disinformation, tell them how they were misinformed, and make sure that they know what’s going on. Have you done that?

That tool is up. I believe there is a place you can go and people can see if they might have seen some of that IRA context, so we have made that —

Privacy advocates feel like that’s not a very accessible tool. Can you actively reach out to people, and tell them “excuse me, I’d like to let you know that this is something that happened”?

Yeah, I mean…

If there’s a consumer watchdog, I might get a letter in the mail telling me that something happened, and I’m owed a rebate by an insurance company. You could actively reach out to users, couldn’t you?

Yes. And you know, we’re Facebook — we believe that in our interface, reaching out to people is a good way to do that, and you’re going to see that on Monday as well.

You’re going to see more of that.

Yeah, Monday it’s going to start rolling out.

But are you going to tell 126 million people who they were, and say “this is the thing that you were misinformed about”?

So we’re trying to reach people the most effective way possible. Some people say they want things in the mail, but some people would say “I’ve not looked at my mail in years.”

Let me make it clear. I don’t mean for you to send snail mail. What I mean for you is, are you going to reach out individually to these people? Which seems to be what the senator wants.

We are making sure the information is available in either QPs — so at the top of news feed — or in other ways that they can find it. We’re very focused on doing that.

What do you think your company’s role is as a publisher in this year’s election and in the presidential election that’s coming in a few years?

Well we certainly know that people want accurate information, not false news, on Facebook and we take that really seriously, and we just talked about some of the steps we’re taking. We also want to make sure that there’s no foreign interference.

We are also really taking very aggressive steps on ads transparency. I mentioned how you’re going to be able to see any ad a page is running; we’re also building an archive of political ads that will run forward and build for four years. So you’ll always have, once it builds up, four years of data. Or for any political ad, you’ll be able to say who ran it, who paid for it, how much they spent, and the demographics of who saw it. Again, industry-leading transparency.

Oh, so that these groups that track campaign financing can come to you and readily get lots and lots of information about how —

It’s going to be available online for anyone to see. Anyone’s going to be able to see it.

Because it’s clear to you that in 2016, it’s hard for anybody to know — or it was hard at the time for anybody to know — just how money was being spent, and by whom.

Well this hasn’t happened in our industry, and that’s why, again, we’re not waiting for the regulation to happen to do this, we’re doing it. Because we think that transparency is really important.

What scares you about your role in this democracy at the moment?

We have an important responsibility and we have a big role, because people use Facebook. And I think what really matters is that we learn from what’s happened; security is an ongoing game. You build something someone tries to get around it. This is going to keep happening, and we need to learn and iterate quickly.

I’m also very focused on keeping the good that happens on Facebook. I was in Houston earlier this week, and I met these two brothers, Nathan and Austin, and when Hurricane Harvey happened they jumped in their boat and they rescued people — including one elderly woman who an ambulance can’t get to, who they say might have died. Do you know how they found those people? Those people posted their information on Facebook. They said where they were publicly, to strangers.

Now I’m not saying every day is Hurricane Harvey, but the good that happens when people share all around the world — the small businesses, I visited many small businesses in Texas this week that are growing, and they’ll tell you, just because of Facebook. And so we’re focused on preserving the good that we believe in so deeply, while protecting people’s information.

But what scares you?

We have a big responsibility. We have to get it right. We didn’t foresee the interference in the 2018 election —

2016, you mean?

Sorry, 2016. Yeah, in 2016 when you thought about security for elections, what you thought about was hacking, and people stealing your e-mails and publishing them. This was a new form. We are now focused on that form, but we’re increasingly trying to see around the corner and make sure that we know the next form.

And I think it’s going to take all of us — were working much more closely with the other tech companies, we’re working closely with election commissions all around the world, which is really important. We’re going to have to figure out what the next form of the next IRA is and get ahead of it.

Is there something of a contradiction here? In that you want to have a community — or many, many many communities really — you want to be democratic, you want input from people, but no matter how much you talk like that, the reality is it’s a company and you make the rules. And it is hard to be democratic in that way when this company is so influential and so vast.

I think the decisions we make are important — and you’re right that they have major impacts, and that’s why we need to be held accountable to them. We’re working hard at explaining them better, at being much more transparent, and especially showing people what’s happening on Facebook.

So again to ads transparency: One of the big questions that happened in the [2016] election was who advertised to whom, because things are targeted to different people. That becomes completely open and transparent.

And it’s interesting — a lot of the things that journalists will find on our site, we built the tool for people to find them. And that’s good! That’s good. Because as we open up for more ads, people are going to find bad ads — they’re going to find ads that go against our policy, and that’s part of how we’re going to be able to get those down and get them down faster.

I want to mention that we’re in the middle of this corporate headquarters — Mark Zuckerberg strolled by a few minutes ago. I’m curious: Having known him as many years as you have, how has he changed as a leader and as an executive, since he hired you?

Well, Mark was 23 when he hired me, so he’s certainly changed a lot of personal levels — he’s gotten married, he’s had two children. And obviously this company has grown greatly. There are a lot of things that have changed.

We’ve learned a lot. We’ve learned a lot from the mistakes we’ve made, from the steps we need to take to be much more proactive — and much more suspicious of what can be done.

But there are things about Mark that haven’t changed at all that I deeply admire. Mark stands up and takes responsibility. You know he runs this company, and through this whole situation he has said “the buck stops here — I own it.” And all of us who work for him — because a lot of those mistakes were made by us — have deeply respected that. He cares about people connecting. When I got home from Houston the other night I called him and I told him about the brothers I met and the other people I met, and he cares.

You know the other day I met a woman named Natalie, she’s from Little Rock. She did one of our birthday fundraisers — brand new product we have — she raised $4000 for a local women’s shelter. And she volunteers at that shelter, and it takes them $1,500 to rescue a woman from an abusive home. And when I talked to Mark about that, Mark has the same belief he always believed, in that, there are really good things that happen when you bring people together. And that that kind of commitment I think is really admirable.

When you say he cares about people connecting, that is really great. And yet that’s one of the reasons that I wonder if what is great about Facebook is also the problem.

You probably know that there was a leaked memo from 2016 from a Facebook executive who said “we care so much about connecting people that even if we connected people who used our platforms to coordinate a terrorist attack, we’re fine with that, because we’re still just connecting people.” That was 2016. You still believe that?

We never believed that. The person who wrote it, named Boz, never believed it — he’s a provocative guy who was trying to spark debate. But Mark never believed it, I never believed it.

OK so maybe it was hyperbole that he was leaning in the way that he did believe, that maybe you cared too much about this, and too little about other things.

Let’s go to the example: There’s no place for terrorism on our platform. We’ve worked really hard on this — 99 percent of the ISIS content we’re able to take down now, we find before it’s even posted. We’ve worked very closely with law enforcement all across the world to make sure there is no terrorism content on our site. And that’s something we care about very deeply.

But what about the broader point? Essentially he was saying “the company’s values are out of whack — we’re interested in one really big, important thing,” perhaps to the exclusion of other things.

Again, that memo was wrong, and he said he didn’t mean it, and Mark and I certainly never agreed. We never only cared about one thing. We cared about social sharing, and we cared about privacy — that’s why we put the controls in place. I think the balance was off, because we didn’t foresee as many bad use cases — and that balance has shifted, and shifted hard now.

One or two other questions and then there will be a photograph and we’ll let you go. I have no idea at the time is … oh yeah, we’re getting to be about that time.

Let me just ask — yeah, a couple more minutes and then we’ll do this.

People in Silicon Valley talk so often about changing the world. Do you believe that this company has changed the world, and is there a way that it’s changed the world for the worse?

It’s such a good question. I believe we’ve done some really good things, and I believe we’ve made some really bad mistakes. I believe that every single day good things happen on this platform. And I believe that a bunch of bad things have happened on this platform that we need to do better getting off.

You know someone today is going to find their mother on Facebook, and someone today is gonna find a friend they were lost in touch with. And someone today is going to put up a piece of content that’s really hate content that we don’t want on there, and we have to find it and get it down fast. All of that’s true.

On that last one, are you comfortable being the censor? Which is effectively what you would have to be, wouldn’t it?

We’re trying to have very good community standards — we’re open about what those community standards all around the world, and we’re going to get increasingly open about this.

We want to make sure people understand — you know, there’s no place for terrorism, there’s no place for hate, there’s no place for bullying. We don’t sell your data ever, we don’t give your information to advertisers. You’re not allowed to put you know hate content on our site. With news, we rely on third parties — we don’t believe we can be the world’s fact-checkers — but that doesn’t mean we don’t have a big responsibility.

And I think in all of this, what we want to do is make the shift we need to make to be more proactive in the protection, so that we can protect something we really believe in and love, which is the sharing that happens on Facebook.

But I think you know what I’m asking you — you have people who want Facebook not to be allowing such manipulation. But at the same time there’s somewhere a libertarian listening to us who is saying “I don’t want a company to be Big Brother, because no matter how good they get at it sometime it’s going to be abused.”

And we try to be really careful about that. That’s why we do have a lot of free expression on Facebook. While we’ll take down things that are absolute hate, boy there’s a lot of stuff on Facebook that I don’t like. But someone said it, and if you believe in free expression you’ve got to let them say what they say.

The most important thing for accountability that we can do — because you’re right, we are a company — is we can publish those standards, make them open. As Mark said the other day, we’re working on a much more open appeals process so people can appeal those decisions. But we’re also going to make sure that people understand what those standards are and can see things transparently.

Sheryl Sandberg, thanks very much.

Thank you for being with me.

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U.S. Farmers Likely Among Hardest Hit By Chinese Tarriffs

China’s retaliatory tariffs hit farmers harder than any other group, especially those raising hogs, nuts and fruit, which rely on exports to keep their business models going.

AUDIE CORNISH, HOST:

We’re going to go to rural Missouri now for another view of the tense trade situation between the U.S. and China. Today, China announced possible tariffs on $50 billion worth of U.S. goods. Like actual tariffs imposed earlier this week, the additional ones now being threatened target farmers, some of America’s most successful exporters. Frank Morris of member station KCUR has been getting reaction.

(CROSSTALK)

FRANK MORRIS, BYLINE: At dawn this morning, farmers at Betty’s Truck near Sweet Springs, Mo., took their coffee with a side of bad news.

JIM BRIDGES: Beans are down 50 cents overnight, and corn is down 14 because of this trade thing with China.

MORRIS: Corn and soybean farmer Jim Bridges, wearing a pair of brown overalls, quickly reckons his potential losses.

BRIDGES: Oh, we’ll see 50 cents, 45 or – about $50,000 of income this year.

MORRIS: China is threatening to slap tariffs on some of the biggest U.S. crops – corn, soybeans, wheat, cotton and beef. But Charles Tuckwillef, sitting next to Bridges in a worn jacket, says it’s too early to accurately tally losses.

CHARLES TUCKWILLEF: It could have an impact on us. Weather probably plays more of a role than a tariff is going to.

BRIDGES: Well…

TUCKWILLEF: We have always survived.

MORRIS: While true, these days, most U.S. farmers survive on exports. They produce far more than Americans can use and selling overseas keeps farm prices from collapsing. China bought more than a billion dollars’ worth of U.S. pork last year. But this week, it slapped a 25 percent tariff on that pork, and that’s being felt here on the farm.

BRENT SANDIGE: We’re loading pigs, whatever, to send them to market right here.

MORRIS: Brent Sandige, here in his hog farm in central Missouri, says he’ll make less on these animals today than he would have last week. But he supports President Trump, and he likes his aggressive negotiating style.

SANDIGE: You know, sometimes you have some short-term pain for some long-term gain.

MORRIS: The current pain is spread pretty wide. China has already placed 15 percent tariffs on farm products grown across a wide swath of the country, including Fresno, Calif., where Ryan Jacobsen runs the farm bureau.

RYAN JACOBSEN: When we talk about the Chinese market, it’s important to recognize that, you know, some of our top exports into there by rank are pistachios, almonds, wine, oranges.

MORRIS: And economically, some California farmers live or die on exports.

RICHARD MATOIAN: Exports represent about 70 percent of our total production.

MORRIS: Richard Matoian with the American Pistachio Growers says that more than half of exported pistachios goes straight to China. China also buys a big chunk of the California almond crop.

MATOIAN: We are generally are free traders. We believe in open and free trade.

MORRIS: And that is something U.S. farmers have in common from coast to coast.

RON PRESTAGE: My name is Dr. Ron Prestage. I’m a veterinarian in Camden, S.C.

MORRIS: Prestage also helps to run one of the country’s largest pork and poultry companies.

PRESTAGE: Do I enjoy being in the crosshairs and caught in the middle in this dispute? And the short answer is no, but I do understand it.

MORRIS: Prestage says U.S. farmers are often the first casualties in a trade war precisely because they are such world-class traders. And economist Chris Hurt at Purdue University says that’s no accident. U.S. farm groups have worked long and hard to chip away at trade barriers, and these tariff fights could upend decades of progress.

CHRIS HURT: And right now, we’re in a trade skirmish but probably not in a war. But the concern is that skirmish could escalate.

MORRIS: And trade war with China isn’t the farmers’ only worry. American producers sell far more to Canada and Mexico combined than they do to China. And if President Trump follows through with his threats to walk away from NAFTA, U.S. farmers could be pinned down in a trade war on two very punishing fronts. For NPR News, I’m Frank Morris in Kansas City.

Copyright © 2018 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

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Trump Administration Identifies Chinese Tariff Targets

President Trump holds up a signed presidential memorandum aimed at what he calls Chinese economic aggression in the Roosevelt Room at the White House on March 22, 2018.

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Updated at 2 a.m. ET on Wednesday

The Trump administration published a list Tuesday of Chinese exports that could soon be subject to a steep 25 percent tariff.

The list covers some $50 billion worth of Chinese goods in sectors such as aerospace, robotics, IT and machinery.

President Trump directed his trade advisers to develop the list last month, as a way to punish China for what the White House calls unfair treatment of American intellectual property. Trump has also ordered his treasury secretary to weigh new limits on Chinese investment in the United States.

The list of tariff targets was made public after the market closed on Tuesday. News of retaliatory tariffs from China on $3 billion worth of U.S. goods contributed to sharp sell-off on Wall Street Monday.

The administration will solicit written comments on the proposed tariff targets through May 11 and hold a hearing on May 15. Supporters and opponents began weighing in as soon as the list was released.

China’s embassy in Washington, D.C., issued a statement early Wednesday saying Beijing “strongly condemns and firmly opposes” the proposed list and said it “gravely” violates the “fundamental principles and values of the WTO.”

“As the Chinese saying goes, it is only polite to reciprocate,” the statement continued. “The Chinese side will resort to the WTO dispute settlement mechanism and take corresponding measures of equal scale and strength against U.S. products in accordance with Chinese law.”

The U.S. Chamber of Commerce said it shares the president’s concern with China’s conduct but warned tariffs would simply raise prices on U.S. consumers and businesses.

“The administration is rightly focused on restoring equity and fairness in our trade relationship with China,” said Myron Brilliant, executive vice president and head of international affairs at the chamber. “However, imposing taxes on products used daily by American consumers and job creators is not the way to achieve those ends.”

The targeted items were chosen in an effort to minimize the impact on ordinary consumers. But that did little to mollify critics.

“While we are pleased that many everyday products such as clothing and shoes are not on the list, we remain concerned that other goods such as consumer electronics and home appliances are targets,” said Matthew Shay, president of the National Retail Federation. “As we’ve said all along, tariffs are taxes on consumers and a drag on the nation’s economy.”

The Alliance for American Manufacturing — a coalition made up of U.S. steel manufacturers and the steelworkers union — was more encouraging.

“If China doesn’t play by the rules, it should lose some of its access to the U.S. market,” said alliance president Scott Paul. “Otherwise, nothing will change and American jobs will continue to suffer at the hands of Beijing’s practices.”

The U.S. had a $337 billion trade deficit with China last year, 9 percent larger than the year before. Excluding services, where the U.S. enjoys a surplus, the trade deficit was $375 billion.

American businesses have long complained about being forced to partner with Chinese firms and share their technology as a price of doing business in the fast-growing Chinese market. China has pledged to halt such forced technology transfers. But similar promises in the past have gone unmet.

The tariffs on China are the latest in a series of protectionist moves announced by the administration in recent weeks. The White House also ordered tariffs on imported solar panels, washing machines and steel and aluminum, though it granted temporary exemptions from the steel and aluminum levies to some of the country’s biggest trading partners.

Experts say the glut of steel and aluminum on the world market is largely a product of over-production in China, although China is not a large, direct supplier of those metals to the U.S.

On Monday, China announced tariffs of its own on exports from the U.S. including pork, nuts and sparkling wine. Although the immediate impact of those tariffs was limited, they fueled concern about an escalating trade war.

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The Scarcity Trap: Why We Keep Digging When We're Stuck In A Hole

Scarcity can make it difficult for us to focus on anything other than the problem right in front of us.

Gary Waters /Getty Images/Ikon Images

Have you ever noticed that when something important is missing in your life, your brain can only seem to focus on that missing thing?

Two researchers have dubbed this phenomenon scarcity, and they say it touches on many aspects of our lives.

“It leads you to take certain behaviors that in the short term help you to manage scarcity, but in the long term only make matters worse,” says Sendhil Mullaianathan, an economics professor at Harvard University.

Several years ago, he and Eldar Shafir, a psychology professor at Princeton, started researching this idea. Their theory was this: When you’re really desperate for something, you can focus on it so obsessively there’s no room for anything else. The time-starved spend much of their mental energy juggling time. People with little money worry constantly about making ends meet.

Scarcity takes a huge toll. It robs people of insight. And it helps to explain why, when we’re in a hole, we sometimes dig ourselves even deeper.

This week on Hidden Brain, we’ll explore the concept of scarcity and how it affects people across the globe — from sugar cane farmers in India to time-starved physicians in the United States.

Hidden Brain is hosted by Shankar Vedantam and produced by Jennifer Schmidt, Rhaina Cohen, Parth Shah, and Laura Kwerel. Our supervising producer is Tara Boyle. You can follow us on Twitter @hiddenbrain, and listen for Hidden Brain stories each week on your local public radio station.

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China Hits Back On Trade Dispute, Slapping Tariffs On 128 U.S. Products

Imported nuts from the United States are displayed for sale at a supermarket in Beijing, Monday, April 2, 2018. China raised import duties on U.S. pork, fruit and other products Monday.

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China announced late Sunday that it would retaliate for the Trump administration’s tariffs on steel and aluminum by imposing its own import charges on a list of 128 U.S. goods, including agricultural products ranging from fruit to frozen pork.

The new tariffs, which China’s Ministry of Finance says begin on Monday, add fuel to what many economists fear is a burgeoning trade war between the two economic superpowers.

Beijing said it was suspending its obligations to the World Trade Organization to reduce tariffs on U.S. goods and would instead impose a 15 percent tariff on 120 U.S. goods, including fruit.

On pork and seven other products, the duty would be 25 percent, the Ministry of Commerce said, according to Xinhua news agency.

Beijing had warned last month that it was considering the tariffs on a range of products. It seems to have followed that script. Other items include wine and nuts, as well as aluminum scrap.

The ministry said the U.S. had “seriously violated” the free-trade principles in the WTO rules.

“China’s suspension of some of its obligations to the United States is its legitimate right as a member of the World Trade Organization,” the Chinese finance ministry said in a statement, according to Reuters.

The differences between the two countries should be resolved through dialogue and negotiation, the statement added.

The salvo from China follows the U.S. imposition of tariffs of 25 percent on steel and 10 percent on aluminum that were initially applied to several trading partners. However, the European Union, Argentina, Australia, Brazil, Canada, Mexico and South Korea have all since been temporarily exempted, while the White House has threatened further tariffs on China.

Last month, President Trump set in motion a further $60 billion in tariffs on Chinese imports to punish Beijing over the “theft” of intellectual property.

The South China Morning Post writes:

“… Beijing has so far held fire against major agricultural products such as soybeans or major industries such as aerospace giant Boeing – items that state-run daily Global Times suggests should be targeted.

The nationalistic newspaper said in an editorial last week that China has ‘nearly completed its list of retaliatory tariffs on US products and will release it soon.’

‘The list will involve major Chinese imports from the US,’ the newspaper wrote, without saying which items were on the document.”

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Advertisers Pull Support From Laura Ingraham's Show After Tweet Mocking Parkland Teen

At least seven companies have pulled their ads from Laura Ingraham’s show on Fox News after Ingraham said David Hogg, a survivor of the Parkland, Fla., shooting, was whining about college application rejections. Ingraham has apologized for her remarks, but Hogg isn’t relenting.

AILSA CHANG, HOST:

The cable television host Laura Ingraham has had a bad 48 hours. It began when the Fox News personality called out David Hogg, a survivor of the Parkland shooting, on Twitter for, quote, “whining about being rejected from four colleges.” Ingraham was widely criticized for the tweet, but the object of her criticism, David Hogg, responded differently. He tweeted to Ingraham asking her to name her biggest advertisers. Numerous Twitter followers obliged, and in the ensuing hours, at least eight of those advertisers have pulled their sponsorship from her program, “The Ingram Angle.”

To talk more about what that means for Ingraham and Fox, we’re joined by NPR media correspondent David Folkenflik. Hey, David.

DAVID FOLKENFLIK, BYLINE: Hey, Ailsa.

CHANG: So can you just briefly walk us through some of the advertisers who’ve pulled their sponsorship as of now?

FOLKENFLIK: Sure. Well, let’s remember she’s a big primetime show for Fox News, the leading cable news channel. So there are some major folks there. Some of the advertisers that have confirmed that they’ve pulled ads are Johnson & Johnson, the home products store Wayfair, Liberty Mutual a little earlier this afternoon and Hulu. And one of the most surprising things about that – it’s a popular video streaming service, offers “Handmaid’s Tale” and others – is that Rupert Murdoch’s 21st Century Fox, which is the parent company of Fox News, itself pulled ads from Ingraham’s show. I think it’s a sign of the kind of pressure they felt themselves to be under both from their clients and from a lot of their producers in the creative community out in Hollywood.

CHANG: But Ingraham is known for being a brash, provocative voice. I mean, that’s her currency. So why has this tweet against this person touched such a nerve?

FOLKENFLIK: Well, let’s not overlook what he survived and what his classmates survived at Parkland – a massacre which took out so many young people filled with promise down there at that high school in Florida. And that – you know, it really weighs upon people as they think about it and think about what she criticized him for in this tweet. She repeated a conservative site’s claim that he was whining about being, in their words, dinged by UCLA with his grade point average. This is just sort of personal. It’s not just disdain. It’s contempt for a guy who’s only in the public eye for what he’s endured and what he’s decided to do about it.

CHANG: Is it surprising to you that a high school student was able to put a boycott like this in motion so easily, so quickly?

FOLKENFLIK: Well, you know, obviously the massacre itself – the nature of that has to take effect. But when we think about mass killings in this country of late, I think what’s singular about it is that they are young enough to be – these students – to be immediately embraceable by so much of the population, even those who may not politically be drawn to their cause. They’re old enough to be able to articulate their anger and pain in ways that perhaps the survivors of the Newtown massacre were not – those young schoolchildren. And they’re young enough to be masters of social media. And I think they’ve really conquered public rhetoric pretty quickly in a pretty amazing way.

CHANG: This isn’t the first time a Fox News host has had advertisers leave over controversy. I mean, I’m thinking of Bill O’Reilly. And he ultimately lost his program. How significant is this for Ingraham and Fox right now, you think?

FOLKENFLIK: Well, I know for a fact that Fox wanted her to address this. She did address it. She said, I apologize for any upset or hurt my tweet caused him or any of the brave victims of Parkland and then kind of went on to do a little bit of a promotion for her show in certain ways. You know, Bill O’Reilly wasn’t the only one. If you think of Glenn Beck’s departure from Fox News, that was predicated after significant public pressure…

CHANG: Right.

FOLKENFLIK: …On advertisers, many of whom peeled out. Sean Hannity – although he survived, his coverage of the Seth Rich case, making baseless accusations about DNC emails leaks to WikiLeaks – he survived that, but they took a financial hit over that. And, you know, they are concerned about this happening to Ingraham as well. I think we’re going to see how much traction this has.

CHANG: All right, that’s NPR’s David Folkenflik. Thanks, David.

FOLKENFLIK: You bet.

Copyright © 2018 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

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Tech Stocks Have Lost Some Of Their Luster, Dragging The Stock Market Lower

The Nasdaq composite index, which includes many tech stocks, has lost nearly 7 percent since March 12.

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Tech stocks were a growth engine for the market when the economy was tepid, but recently they’ve been sputtering and their troubles are helping drag the entire market lower.

Some of the biggest names in technology have been swooning.

Facebook is mired in a scandal over a breach of its user data, leading to calls for stricter government regulation of the social media giant. Since the beginning of February, its shares have dropped from $193 to $159 — a nearly 18 percent dive.

Amazon has been targeted in tweets by President Trump. On Thursday, he said the online retailer pays “little or no taxes” and is “putting many thousands of retailers out of business.” Amazon’s shares are still up a lot for the year, but they’re down by more than 9 percent since March 12.

Apple, which faces questions about its growth strategy, is down about 8 percent since the same date.

The downturn has swept through the tech sector, dragging down companies that include IBM and Microsoft. The Nasdaq composite index, which includes many tech stocks, has lost nearly 7 percent over the same period. By comparison, the broader Standard and Poor’s 500 index is down 5.5 percent.

“The market has a psychology right now of, ‘When in doubt, get out. We’ll figure out later what happened,’ ” says Julianne Niemann, a financial analyst at Smith Moore.

The slide is remarkable because tech stocks have long been seen as growth leaders, and investors have for the most part eagerly piled into them.

“If you think about social media, if you think about e-commerce, basically technology is the backbone for all of those different things, and for these corporations it’s driven incredible profit growth,” says Sameer Samana, global equity and technical strategist at Wells Fargo Investment Institute.

For investors searching for growth stocks in an economy that sometimes seemed anemic, stocks such as Facebook and Apple could look like lonely outposts of promise.

“Tech stocks have been the dominant area,” Niemann says. “This is one thing that investors have jumped all over, simply because they can understand them. They love these stocks.”

This tech downturn matters, because those stocks occupy an outsize place in the market — making up about 25 percent of the S&P 500, and they make up a big share of the stocks in retirement funds and mutual funds.

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Niemann sees the recent turmoil as temporary, noting that conditions are considerably different than they were during the last big market downturn, in 2007-08.

“This is entirely different. We have not had a meaningful correction in a long period of time,” she says. “There’s so much cash available on the sidelines to invest that everybody keeps jumping in and chasing it back up again.”

“The economy is still OK,” she adds. “The market doesn’t take down the economy.”

Samana says the tech industry is still relatively young, and some hiccups are inevitable.

“We’re still trying to figure out how things like social media fit into our lives and how data should be managed and all those different things. And so I think this is just part of the growing pains of, ‘How do we regulate these companies?’ “

But for now, investors are reassessing whether tech is as promising as it once appeared, and their new caution is being felt throughout the market.

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America Has A Large Trade Deficit, But Economists Aren't Too Concerned About It

A container ship waits to be unloaded at the Port of Oakland in California. President Trump says the trade deficit that the U.S. runs with other nations must be slashed for the well-being of the country.

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Like a lot of Americans, President Trump sees the U.S. trade deficit as an urgent problem — a symbol of U.S. economic decline.

“Any way you look at it, it is the largest deficit of any country in the history of our world. It’s out of control,” Trump said earlier this month when he announced proposed tariffs on Chinese imports.

Most economists, of various political leanings, are a lot less worried about the trade gap, which totaled $568 billion last year.

“I don’t think it’s a problem for the U.S. to have a large trade deficit,” says Veronique de Rugy, senior research fellow at the Mercatus Center at George Mason University.

The United States buys a lot of products from other countries, everything from oil and chemicals to shoes and automobiles, and when it does, it pays for them in dollars, she notes. As a result, countries such as China and Japan accumulate vast piles of U.S. currency.

Those countries have to exchange those dollars for something, and for a long time they’ve used them to buy U.S. assets, such as stock, real estate and Treasury bills.

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“Every dollar that we send in exchange for goods will come back to us from foreigners in the form of investment. In a sense, if you think about it, it’s a win-win for the U.S.,” de Rugy says.

Bilateral trade deficits — such as last year’s $375 billion U.S. goods gap with China — are even less important, says Alan Blinder, a former Federal Reserve governor and a professor of economics.

“They’re absolutely normal components of trade. I now have a very large bilateral trade surplus with my employer, Princeton University, which gives me a paycheck, and I buy almost nothing from the university,” Blinder says.

“I have a bilateral deficit with the grocery store, where I buy lots of food and they buy nothing from me. That’s the way trade goes,” he says. Blinder says trade deficits can become a problem if foreigners suddenly stop wanting to invest in a country. That’s what happened to Greece, he notes.

“When it can be a problem is when the rest of the world decides you’re not such a good credit risk,” Blinder says.

That hasn’t happened to the United States and it doesn’t appear that it will anytime soon. Foreign investors continue to shovel money into U.S. government debt, for example, resulting in a long period of low interest rates. And they’re big buyers of U.S. real estate and stock.

The specter of foreigners buying up U.S. properties may disturb a lot of Americans, who view it as ceding economic control over the country’s assets. But it shouldn’t, de Rugy says.

“I’m French, and I can tell you these fears also exit in France,” she says. “I remember the frenzy about Japanese buying our castles. It just never materialized. This fear people have that it will change the country, that it will put us at risk, it actually doesn’t happen.”

And with the U.S. government amassing growing amounts of debt every year, it needs the money that foreign investors offer.

“We should be happy that there are countries willing to lend us money at a lower price, because if they weren’t it would mean the interest on the debt we pay would be way higher, and it would mean a bigger share of what the government spends going to interest payments,” she says.

But Celeste Drake, trade and global policy specialist at the AFL-CIO, is more skeptical about U.S. trade policy.

Economists have been making lavish promises about trade agreements such as NAFTA for years. They’ve said trade makes U.S. companies more productive, allowing them to sell more products abroad and creating good, high-wage domestic jobs.

Instead, the trade deficit has persisted and wages for many workers have been stagnant or worse, Drake says. It’s reasonable to ask how long that can continue without damaging the economy, she says.

“This is where we have to say, ‘Why don’t we revisit the policies that we’ve put in place? Why don’t we start looking at this trade deficit that we’ve ignored for more than 30 years and to try to figure out how we can address it?’ ” Drake says.

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Costly Care In America

17.8

Healthcare spending represents a huge chunk of the American economy; more than in other places. And it’s not because Americans are hypochondriacs.

Dr. Ashish Jha, physician and professor of global health at Harvard, discusses why we spend so much money on medical care and some ways we might be able to spend less.

Music by Drop Electric. Find us: Twitter/ Facebook.

Subscribe to our show on Apple Podcasts, PocketCasts and NPR One.

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FTC Confirms It's Investigating Facebook For Possible Privacy Violations

The Federal Trade Commission is investigating whether Facebook violated an agreement with the FTC in allowing users’ data to be revealed secretly to Cambridge Analytica and political campaigns.

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Alex Brandon/AP

Updated at 7:50 p.m. ET

The Federal Trade Commission confirmed Monday that it is investigating the possible misuse of the personal information of as many as 50 million Facebook users. The probe comes after the social network admitted it suspended a firm that worked on behalf of the Trump campaign to use personal information gathered on Facebook to target potential Trump supporters.

Privacy activists and some members of Congress have called for the agency to fully investigate whether the handling of Facebook user data violated a 2011 consent decree with the FTC. The consent decree was the result of a two-year-long investigation by the agency into Facebook’s privacy practices.

The current investigation stems from the purchase of personal data by Cambridge Analytica, a data analytics firm, from a researcher who gathered it by using a Facebook app. The app asked users to take a personality test and then gathered data not only about them but about their friends.

“This latest scandal will be a test case of whether [the FTC] is willing to put the public before the data gathering industry,” says Jeff Chester, executive director of the Center for Digital Democracy, a privacy rights group. Chester and other advocates charge that the FTC hasn’t been keeping a close enough eye on consumer privacy.

But Chris Hoofnagle, who directs the Berkeley Center for Law & Technology at University of California Berkeley, says it isn’t clear that Facebook violated the consent decree. According to Hoofnagle, the decree says that Facebook is not liable when users consent to giving their friends’ information to Facebook.

However, Hoofnagle thinks what is likely is that once the FTC starts investigating the social network it will find that it has engaged in other illegal practices. Hoofnagle says Facebook attracts developers by making it easy to get personal information. He believes that makes it very tempting for Facebook to overlook breaches of privacy so that they can keep attracting developers.

In a statement, the FTC says it takes very seriously recent press reports raising substantial concerns about the privacy practices of Facebook. Facebook says it will cooperate with the FTC and says it would “appreciate the opportunity to answer questions the FTC may have.”

Facebook was also hit with another lawsuit. Cook County, Ill., is suing the company and Cambridge Analytica. Cook County’s State Attorney Kimberly M. Fox says both companies violated Illinois’ fraud law.

In a statement Fox said, “Cambridge Analytica deliberately mislead Facebook users by mining — without user’s knowledge — information about every Facebook ‘friend’ of people who took an online ‘personality quiz.'”

The suit also alleges that Facebook engaged in deceptive practices because it represented to the public that strict limitations and protocols on data gathering were in place. Yet, the suit says, Facebook knowingly allowed app developers, including Cambridge Analytica, to accumulate and mine data in excess of these policies.

The Cook County lawsuit is one of several that have been filed since The New York Times and The Observer of London reported that Cambridge Analytica had gained access to private information belonging to tens of millions of Facebook users. Among the lawsuits is one being brought by a Facebook user as a class action case for violation of user privacy. Another case is being brought by a shareholder because of the drop in stock price after the data harvesting was revealed.

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