Child Advocate Envisions ‘Game-Changing’ Windfall From Social Media Settlements
Children’s Funding Project Founder Elizabeth Gaines said verdicts could remedy a 'rough decade' for young people.
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A tidal wave of litigation aimed at social media platforms is drawing comparisons to the tobacco and opioid cases of recent decades, with observers predicting the companies that operate sites like Facebook, Instagram and TikTok could soon be paying out billions in court settlements.
As of last month, more than 2,400 claims were pending in the overseen by a judge in California. More than 10,000 individual cases and nearly 800 school district claims were pending across . And more than 40 have filed or joined lawsuits against the companies.
The lawsuits allege that the platforms were deliberately engineered to maximize addictive use among children and teenagers, and that the companies knowingly designed them to drive young people’s prolonged engagement, despite mounting evidence that they can be harmful.
Their recommendation algorithms amplify harmful material, the lawsuits allege. And weak age-verification systems have allowed underaged users broad access. The companies that run the platforms knew about these risks, they say, but failed to warn users and families about the mental health risks, often revealed by their own research.
The companies have disputed these claims, maintaining that their platforms include safety tools. But one of them, Meta, which runs Facebook, acknowledged that the lawsuits could be costly, this year with the Securities and Exchange Commission warning investors that the lawsuits and mass arbitration demands could “significantly impact” its finances.
That could happen soon. In late March, two landmark verdicts came down within 24 hours of each other: On March 25, a Los Angeles jury found Meta and YouTube liable for designing that harmed a 20-year-old woman who started using them as a child. The jury awarded her $6 million. The companies that run Snapchat and TikTok were also named as defendants, but reached undisclosed settlements before trial.
A day earlier, a New Mexico jury for failing to protect kids from child exploitation and ordered it to pay $375 million for consumer-protection violations. “You add it all up and it could be hundreds of billions of dollars,” social psychologist Jonathan Haidt recently.
As with the tobacco and opioid lawsuits, one major question is emerging: Where will the money go? Will the proceeds benefit children, or will they end up simply padding states’ and school districts’ budgetary bottom lines?
To answer this, Ӱ turned to Elizabeth Gaines, founder and CEO of the , a nonprofit focused on helping governments and communities figure out how to pay for programs and services that support children and youth. The organization doesn’t run the actual programs, but helps leaders and policymakers build sustainable funding systems to establish and keep these programs going, such as early childhood education, afterschool programs and mental health services.
It specializes in so-called “strategic public financing,” which pushes communities to examine how much they spend on children, how much they actually need and where they can find or generate more funding for, in Gaines’s words, “deeper investments” for kids.
A lifelong child advocate, Gaines has worked in the field for 30 years, from think tanks to state-level advocacy. She founded the funding project eight years ago. “I looked around and realized that no one at the national level was really focusing on the public financing of child and youth development and programs and services writ large,” she said.
The project now tracks more than 300 federal, state and local funding streams that support children and youth from cradle to career.
Gaines began her career in her home state of Missouri, where she worked on ensuring one key goal: that proceeds from the 1998 benefited children.
Spoiler alert: They didn’t. A budget shortfall prompted lawmakers to redirect millions from the settlement into the state’s general fund. Gaines now admits, “We did not get involved early enough in that process to really be able to shape the outcome of those dollars.”
Nearly 30 years later, with thousands of cases focused squarely on the harms of social media, she is working to build a coalition of groups that can persuade governors, lawmakers, educators and attorneys general to keep the focus on uplifting kids, not filling budget holes. The coming legal settlements, she said, are payback for that harm. “And [when] they pay back in, it needs to go back into the public good.”
Ӱ’s Greg Toppo recently sat down with Gaines for a wide-ranging conversation on her work and the “game-chaning” potential of the social media payouts.
The conversation has been edited for length and clarity.
First let’s talk about the tobacco payouts. You were in Missouri at the time. As you look back on that now, what were the mistakes?
The tobacco settlement was the Wild West. I remember we had $20 million that the governor and the legislature had committed, and they were like, “Yes, we’re going to put that towards positive youth development — and it’s going to be huge!” Back then, that was big dollars for Missouri. And then there was a little budget crisis, and the governor withheld those dollars. It was like, “Oh, sorry.” But that was happening all over the country at that time. There are some states that did a good job of setting tobacco settlement dollars aside and having a real method to how they dispersed them, but for the most part, those dollars went into the general fund and never really tracked in any significant way.
What about the opioid settlements?
They’ve gotten better, and I think we’ve been really guided by in the opioid settlement, which was like, “Here are the 10 things that these dollars are intended to be used for.” And so states have taken that, some of them more seriously than others, as the funds roll out.
So let’s assign a number, a score of one through 10 to the tobacco settlements in terms of where the money went.
Writ large, that’s so hard. I mean, anecdotally, because I haven’t done a full research study, my sense is probably three out of 10. States weren’t putting funds towards something that was prevention-oriented or reinvesting in the community.
I want to make sure I understand what the Children’s Funding Project does. I know what your objective is. I wonder: Do you have any leverage, or is this all just advisory? Are you on the outside looking in, saying, “Hey, governors, you should do this”? Or do you have power to make these things happen?
We have no real hard power in this. What we are attempting to do is go around and get regulations in place. And what we really need is to then replace that with deep investments in young people. We’re narrowing in on the attorneys general who are going to be at the table, because they’re leads among the states in the suits, making sure that they understand that it’s not just a settlement to punish the companies and then wherever those dollars go, so be it. There’s a safety aspect that they’re working on: Protect young people, change the platforms, make sure we’re not having faulty products like we’ve had.
But then there’s a youth justice component to this too. And people just haven’t gotten there yet. So I think we’re just ahead, honestly, of where zeitgeist is on this, and when we do get it in front of people, they’re like, “Yes, that’s where the money needs to go.” We’ve got a former attorney general who’s advising us on how the A.G. world works because it’s new to our field.
So no, we are not involved in the suits directly, and that’s intentional. That’s somebody else’s job. Our job, as the people who care about funding for kids, is to focus on making sure that money goes to the right place.
So let’s talk about that. What are the things we should be buying with it?
Spokane, Washington, has this thing that they started out of their schools called . Basically what this buys is some joy and some curiosity and some investment in things for a group of young people that have kind of had a rough decade. It’s not been awesome to be a young person. And so this is to say, “You want to learn to play the trumpet? You want to learn to code? You want to learn to build trails out in the woods? Whatever it is that’s speaking to you as a young person, we want to put an infrastructure in place that actually allows you to go and explore that.” And so they’re doing it in Spokane, which is great.
You talk about a “rough decade” for young people. It sounds like you want to offer them opportunities that maybe even their predecessors, their parents, didn’t have.
I will just say this: There are special cases where young people have gotten to do it. I ran youth programs 30 years ago. The program that I ran became one of the very first . And there are people who I hired that work there to this day who are incredibly talented youth workers, who now for generations have been saving young people and really helping them find their calling. And to have young people in relationships with talented adults who know how to do that — and other talented young people, what we call “near peers,” who can provide that kind of guidance — is something we’ve never had.
21st Century Community Learning Centers have basically been since years ago. It’s kind of crazy to think that we’ve never invested more than a billion dollars in that as a country.
If you went to an attorney general, and they said, “Just lay it all out for me,” what are the possibilities? Obviously there is a constituency that will say, “Just give the schools more money.” Just make classes smaller, improve buildings, put in HVAC, and on and on and on. Pump money into the system. Do you find yourselves in opposition to that?
They should, just as a matter of course, pay for HVAC systems for our schools, and so using this special pot of money to do that is not going to have the intended impact that we want to have. And given the direct link between the harms related to youth mental health and what we know about investing in prevention and upstream opportunities, this is a chance to really make a significant investment in those kinds of things. So the coalition that we’re building is really trying to bring together the people not only that are in the comprehensive afterschool funding community, but into sports and play, outdoor education, arts, civic engagement leadership, youth in service types of activities. There’s a bunch of stuff that’s always been underfunded. This is a chance to quadruple down on it.
Quadruple down?
Well, I’ll just go ahead and admit it’s going to be more than that.
You’re talking about the harms of social media, and obviously thinking of ways to to remedy that. Who are the people you would work with to make some of these things happen?
Let me be clear: We are really trying to coalesce any organization. Largely they’re community based organizations. There’s the names that people know: the Boys and Girls Clubs and the Y’s, but there’s also really organically grown, community based organizations that, in many cases, are the most effective at reaching young people that are hard to reach in the places where they are. And those folks have always just done that work and found ways to do it, but have been deeply underfunded. And so if I was the boss of social media litigation, I would say investing in those homegrown, local organizations would be a really powerful thing to do. We’re trying to bring all of those folks to one table, and then there’s going to have to be state-by-state approaches.
Could you envision a landscape where offering funding to public schools is in opposition to the Girl Scouts or the Campfire Girls or Boys and Girls Clubs?
Certainly that could happen. But our intent is to make this like what they’ve done in Spokane. That’s superintendent-led. I think the schools are going to have to get that this is an opportunity to really do some things that they get pressured to focus on, when really they have a job to do already and they can’t seem to layer the social-emotional well-being of young people on top of what they’re trying to do.
I was talking to somebody today about something totally unrelated, and they used the term “human flourishing.” That sounds kind of like what you’re talking about.
Yeah. I mean, listen: With the onset of AI and the way that the world is shifting, I think there’s going to be a huge need that becomes so clear for folks about just the value of being human and how we raise good humans. It’s going to become increasingly important.
You talked about attorneys general. Are there any who you feel are leading the way?
You probably saw [New Mexico Attorney General] , the New Mexico case, which is not actually part of the larger case, . [A jury in March found that Meta had failed to protect young users from child predators on Instagram and Facebook.] It was the first one at the state level out of the gate that has gotten an early verdict. And it was pretty powerful. He was only looking at one set of harms related to child exploitation. So just on that one harm alone, they said was owed. And then if you extrapolate that to all the other harms, it’s significant. Certainly Kentucky’s, A.G., Colorado’s, California’s. But it’s a truly bipartisan group of A.G.s that are leading on this.
These strike me as not just life-changing numbers but just system-changing numbers. I mean this has a potential to really just change how we even consider what’s possible.
That’s the point, and that’s, I think, why people get very excited about this as a solution, as a chance to really dream and to get young people excited and engaged. “Game-changing” is how we’ve been describing it to the field. And we’ve got to stop thinking about just like, “Let’s fight for those little afterschool dollars that we’ve had all this time.” No, this is about a bigger play.
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