Here’s a tricky business trivia question, courtesy of Fox Television: Who invented Facebook?
If your first answer is Mark Zuckerberg, you know the basics. If your answer is Cameron and Tyler Winklevoss or Eduardo Saverin then you know some of the back story, as dramatized in the movie, “The Social Network.” But if your answer is John Stossel, host of a weekly Fox Television business show and a college classmate of mine back in the late 1960s, then you have watched the episode of Stossel’s show that ran on May 8.
So how could Stossel claim to have invented Facebook? Mostly tongue-in-cheek, but here’s the background. In 1965 a Princeton undergraduate named Peter Sandman, a writer for the Daily Princetonian, came up with the idea of printing a guidebook to the “Seven Sister” colleges that complemented the then all-male Ivy League. “Where the Girls Are” was a glib, humorous guide intended to help male college students on the prowl make their way in and around the all-female campuses.
The book became a huge success, netting lots of money for its student publishers on the Princetonian and lots of national publicity for Sandman and his colleagues in the Class of 1967. Two years later Stossel and I were running the Princetonian. He was the business manager; I was the chairman, in charge of the editorial department.
As Stossel recalled it on his show, he came up with the idea of creating a sequel called “Who the Girls Are,” adding an important element missing in the original guidebook: photos of the girls.
As I recall it (and as the staff box of the publication suggests) the idea came from two younger guys on the business board. But either way Stossel and I both signed off on the project. Soon our intrepid reporters were, well, prowling the campuses of the women’s colleges, coming up with the skinny on how to navigate them, and securing the signed permissions to print 1,488 freshman year photographs. We even identified them by hometown and printed a geographical index in the back of the 112-page book.
It was a limited-edition Facebook, and it lacked only a communication medium such as the Internet to go viral. Instead it went nowhere. We published it in the fall of 1968. By the next fall Princeton and several of the other Ivy League schools had become co-educational. The planned 1973 edition never happened. I went on from Princeton to become a correspondent for Time Magazine. Stossel moved from the business side into the editorial side of journalism, taking a job at a television station in Portland, Oregon, the first step on a path to national exposure with ABC and then Fox.
So what was Stossel trying to prove by making the claim that he had invented Facebook? First, I am sure, he was trying to tease his viewers to watch to the end of his one-hour show. Second, he was offering an example of how free enterprise allows someone to fail, possibly fail many times, but still eventually succeed — all in contrast to big government’s unrelenting attempts to stifle business.
Yes, while I was pursuing my enlightened (what else could describe it?) brand of practical progressivism, Stossel was falling into the abyss of libertarianism.
The theme of his Facebook show was how difficult it is to start a business now as compared to the good old days of the 1960s and less intrusive government. The poster child for his argument was, literally, a child. An elementary schoolgirl who had baked some cupcakes for a classmate’s birthday discovered that other kids loved her creations. She started a home-based cupcake business and then — thanks to some big bad government bureaucrats — was forced out of business after she failed to meet the myriad regulations imposed on food businesses.
Sounds terrible, of course. But we don’t know all the background on this particular business. Was the little girl operating in a town where another, larger business was challenging the health department over a particular requirement, and officials couldn’t afford to be more lenient toward one business?
But, for argument’s sake, let’s agree that government squelched this budding little food enterprise. Does that mean that it’s more difficult to start a business now than in the good old days of smaller, less obsessive government?
Not even all of Stossel’s guests on his “I created Facebook” show agreed with his premise. One woman, who had dodged death on 9/11 and decided to leave the security of the corporate world after that, had founded not one but two successful businesses since then. She argued that, with the networking and marketing possibilities of the Internet, it was actually easier to start a business than before.
In our print newspaper business, it took me a substantial amount of start-up capital plus a lot of inside connections to be able to put together the first issue of U.S. 1 in 1984, using the then cutting edge technology of photo-typesetting and cut-and-paste production. Today someone could do the same thing with a $400 computer and $600 worth of software (or for free at the neighborhood library).
The people who don’t make it in business love to blame government for their failure. But those of us who have been around for a while know that the same guy who is unable (or unwilling) to fill out a quarterly wage report may also be the guy who can’t (or won’t) keep track of his account receivables.
Some contractors and handymen love to blame the oppression of the municipal building inspector for delays and cost overruns on their projects. “West Windsor (or Princeton, Lawrence, Hamilton — you name it) is the worst town to work in,” some contractors will tell their customers to explain a delay. But the fact is that all townships have to adhere to the same state construction code. As a lot of township building inspectors will tell you, some workers don’t bother to read the code. Or choose not to.
All this rhetoric in response to Stossel’s show assumes that government is the only enemy of business. But the fact is that businesses have been gobbling up other businesses, and stifling new businesses, whenever they have had a chance. That point was made just this week in a New York Times article describing how Amazon is delaying shipments of books published by firms that don’t adhere to Amazon’s rules. So there, Stossel, it’s not just government with these stifling regulations.
How can Stossel possibly defend his position? You can get some insight into his thinking at this year’s Reunions. Stossel, back for his 45th reunion, will appear on an alumni panel Saturday, May 31, at 9 a.m. at the Frist Campus Center, Room 302. The topic: “Views of Modern Conservatism and Libertarianism.” Maybe I’ll show up. Or maybe not. I still have my copy of “Who the Girls Are.” I could take a road trip instead.