Competing Naïvetés: How to Produce a Privacy-Protective Society

My Economist.com debate on whether governments should “do far more to protect online privacy” has now concluded. The vote on the motion went to my opponent, supporting government involvement by a margin of 52 to 48 percent.

I won a moral victory, perhaps, moving the vote from 70 percent in favor of government intervention to the very close ending tally. My commentary highlighting the substantial role of government in undermining privacy seems to have begun moving the dial in my direction.

A pleasant side-effect of the debate was to open lines of communication with a number of my privacy-advocate colleagues, many of whom do not share my libertarian outlook. One called me naïve to think consumers can successfully demand privacy given the imposing wall of corporate practices that rely on intensive and comprehensive data collection.

Full health privacy, for example, would require a marketplace in which consumers can pay cash for services or demand that information about their treatments not be shared. It is illegal for a pharmacy to fill a prescription without identifying the patient apparently, a requirement that sets up the conditions for nationwide tracking of patients’ medicines and, inferentially, their health conditions.

This prescription tracking is facilitated and reinforced by government regulation, of course. Consumers cannot exercise privacy self-help when the law requires pharmacies to collect information about them. Freedom to pay cash for medicines, and to do so unidentified, is at best a long way off, to be sure.

But I had suggested the naïveté of the pro-government view as well:

The arguments for government control certainly seem to rest on good-hearted premises: if we just elect the right people, and if they just do the right thing, then we can have a cadre of public-spirited civil servants dispassionately carrying out a neutral, effective privacy-protection regime.

But this romantic vision of government seems never to come true. Crass political dealmaking inhabits every step, from the financing of elections, to logrolling in the legislative process, to implementation that favours agencies’ interests and the preferences of the politically powerful.

For government to protect privacy, the ideal of “clean government” would have to be realized. But proposals to move policy in that direction, such as regulations on how elections are financed, happen to conflict with fundamental American rights like freedom of speech and petition. Public financing would make the government itself politicians’ most important constituent, ripping it loose from the moorings that protect individual rights and liberties.

A host of legislative process reforms might only begin to drive a wedge between politicians and what they do best. And the ideal of a neutral, scientific regulatory process has not materialized. Regulation is a different, more obscure forum for expressions of political power. For this reason and others, regulation is poorly suited to balancing all the interests of consumers compared to market processes, which are the best method we have for discovering consumers’ true interests and apportioning resources accordingly.

I’ll take my naïveté over the alternative. Reducing the power of government and thereby setting the conditions for consumer-centered privacy protection seems a more likely prospect than taking the politics out of politics, which is an even bigger, even more forbidding project.