On January 12th, President Obama made the first presidential visit to the Federal Trade Commission (FTC) since 1937. In his remarks, he noted the tremendous job the Commission has done protecting American consumers for 100 years. You’d be hard pressed to find anyone who disagrees, except perhaps the manufacturers of the “caffeine-laced undergarments” the president thanked the Commission for protecting us from.
So what brought the president to the Commission’s headquarters? Some great ideas about “protecting our information and privacy in the Information age.” Ideas he said advance business leaders interest in protecting privacy, and consumer and privacy advocates interest in “making sure that America keeps leading the world in technology, innovation, and apps.” And, perhaps most importantly in the political environment of Washington, DC, ideas the president said “transcends politics” and “should not be a partisan issue.”
{mosads}One of those great ideas? Data breach legislation. Frustrated with the confusing and costly patchwork of state laws, the president called for “a single, strong national standard so Americans know when their information has been stolen or misused.” Industry and advocates couldn’t agree more.
Another great idea? Protecting student’s digital educational data. Passing a federal version of the landmark (the president’s words) California student data privacy bill. Seems like a no brainer.
So if the enactment of new common sense consumer protections is a shared ideal; one that industry wants, consumer and privacy advocates want, Democrats and Republicans want, then what is the administration’s next step to achieve these tantalizingly close victories? To kill it.
In addition to the laudable objectives above, the president also announced his intention to introduce new European-styled data privacy restrictions, cleverly titled the “Consumer Privacy Bill of Rights”. On Capitol Hill this proposal is also known as the “giant wet blanket” that will bring everything else the president proposed to a halt.
The purported focus of this proposal – protecting personal privacy and giving consumers’ choice over data collection – again reflects shared ideals. The president’s description of the bill was elegant and simple. However, the global digital economy is anything but. It is an exceptionally complex environment and a one-size-fits all data governance approach is ill-advised. This is the same legislative strategy that has stifled economic development and technological innovation in Europe and lead the EU into a decades long political morass. Such a proposal from this Administration will plunge the U.S. into a partisan, contentious, and counter-productive legislative debate.
In his non-partisan proposals the president pointed out that data breaches cost consumers and businesses billions of dollars in damage each year – a quantifiable harm. The student privacy bill would achieve the targeted and specific policy objective of protecting data collected from students in educational settings. Notably absent from the president’s plan for broad privacy restrictions was an elucidation of the threats they seek to protect us from or specific policy objectives that are worth pursuing.
Existing laws do an excellent job of addressing targeted areas where misuse of data could cause identifiable harms to consumers. Pursuing a privacy bill in an attempt to prevent theoretical harms is sure to put a deep chill on the creators, designers, and innovators the president called “the pioneers of this Information Age.” The unified opposition from industry, Capitol Hill, and privacy advocates alike to a privacy bill of rights freezes the prospect of advancing any of the president’s other initiatives in the consumer protection space.
Though not explicitly mentioned, implicitly implicated in the conversation about privacy is online advertising – the decade old go to for the amorphous “potential harms” we have been conditioned to reflexively fear. The reality? In the five years since the Commerce Department released their first green paper on consumer privacy (the origins of the Consumer Privacy Bill of Rights) data breaches have cost Americans billions of dollars and states have had to take the lead on the issue of student privacy. If the president and the administration is serious about protecting consumer let’s start there, with a pair of new laws for his talented friends at the FTC to enforce and protect Americans with. If they choose instead to pursue broad new data privacy restrictions the Commission probably has time to plan before the next presidential visit, circa 2095.
Zaneis is executive vice president of Public Policy and general counsel of the Interactive Advertising Bureau (IAB).