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Illustration: Rebecca Zisser/Axios

The U.S., along with the U.K. and Australia, has sent a letter to Facebook asking it to halt implementation of end-to-end encryption tech in its services, in order to keep messages accessible to law enforcement.

Why it matters: The request marks the latest twist in a long-running debate over encryption, with some arguing for government backdoors and others maintaining that there is no way to provide them without compromising security and privacy.

  • Facebook's move to encrypt Messenger and Instagram messages would significantly expand the proportion of all messaging that is encrypted, but Facebook's WhatsApp and Apple's iMessage are already encrypted from end to end.

The big picture: Facebook's pivot to encrypted messaging, announced last winter, is raising tons of questions, from how the company will make money to how to combat child pornography, human trafficking and cybercrime.

Asked about the issue at an employee Q&A Thursday (which Facebook broadcast publicly), CEO Mark Zuckerberg said one reason the company announced the move toward encrypted messaging years ahead of actually doing so was to consult with law enforcement and child safety groups on how best to mitigate potential harms.

  • "I still think that the equities are generally in favor of moving towards end-to-end encryption," Zuckerberg said.

What they're saying:

  • U.K. Home Secretary Priti Patel: "So far nothing we have seen from Facebook reassures me that their plans for end-to-end encryption will not act as a barrier to the identification and pursuit of criminals operating on their platforms. Companies cannot operate with impunity where lives and the safety of our children is at stake, and if Mr. Zuckerberg really has a credible plan to protect Facebook’s more than 2 billion users it’s time he let us know what it is."
  • Facebook: A spokesperson said the company believes "people have the right to have a private conversation online, wherever they are in the world," and noted that more than 1 billion people send encrypted messages every day. The company's statement added that it respects the role of law enforcement and noted that it is "consulting closely with child safety experts, governments and technology companies and devoting new teams and sophisticated technology so we can use all the information available to us to help keep people safe."
  • ACLU senior legislative counsel Neema Singh Guliani: “When a door opens for the United States, Australia, or Britain, it also opens for North Korea, Iran, and hackers that want to steal our information. Companies should resist these repeated attempts to weaken encryption that reliably protects consumers' sensitive data from identity thieves, credit card fraud, and human rights abusers.”

History lesson: The FBI got into a huge fight with Apple in 2016 after the company refused to rewrite iOS to make it easier for the government to crack the encrypted phone of the San Bernardino shooting suspect. The conflict never really got resolved, as the FBI found another way in.

Go deeper

Dan Primack, author of Pro Rata
56 mins ago - Economy & Business

Trump blocks banks from limiting loans to gun and oil companies

Illustration: Sarah Grillo/Axios

Big banks are no longer allowed to reject business loan applicants because of the industry in which they operate, according to a new rule finalized on Thursday by the Trump administration.

Why it matters: Wall Street has curtailed its exposure to industries like guns, oil and private prisons, driven by both public and shareholder pressures. This new rule could reverse that trend.

Former FDA commissioner: "Reliable drug supply is absolutely critical"

Axios' Caitlin Owens and former FDA commissioner Mark McClellan. Photo courtesy of Axios Events

Having a reliable supply of pharmaceutical drugs throughout America will be "absolutely critical" to boosting affordability in health care during the Biden administration, former Food and Drug Administration (FDA) commissioner Mark McClellan said at a virtual Axios Event on Friday.

The big picture: McClellan, who served under President George W. Bush, says drugs having limited supply and limited competition leads to elevated pricing. He considers drug supply to be a national security and public health issue.

Felix Salmon, author of Capital
4 hours ago - Economy & Business

Americans are still spending money

Source: Census Bureau; Chart: Axios Visuals

Americans spent more money at stores and restaurants in 2020 than they did in 2019 — even in the face of a devastating global pandemic that shut down broad sectors of the economy.

Why it matters: The monthly retail sales report this morning came in well below expectations, and showed consumer spending falling on a seasonally-adjusted basis. Total expenditures were still higher in December 2020 than they were a year previously, however.