Chapter 3. Privacy Organizations and Initiatives

The consumer on his own stands no chance of defending his own privacy needs. The lack of power by the individual consumer has given rise to a number of organizations that should lessen the burden of fighting the “forces of evil” that would take away all our privacy rights. “Forces of evil” might be a strong term, but how else to describe companies and governments that would strip others of an inherent right to be left alone and to keep our personal information confidential?

The U.S. government has failed to set the standards and controls necessary to ensure our privacy. It has been the task of the privacy industry, organizations, and individuals to create these standards. The government has even failed to meet its responsibilities on the standards of privacy. In 2000, the government banned cookies from most government sites, yet reports of 51 inspectors general found 300 cookies on the Web sites of 23 agencies that should not have been there. Cookies, as we mentioned in earlier chapters, track user information and browsing preferences. “These reports document a real problem—the violation of Americans' privacy by their own government on the Internet,” said Sen. Jay Inslee, (D-Wash). Auditors from that agency learned three contractors who maintained Web sites for government departments were collecting personal information, such as Social Security numbers, without disclosing how they used that information.

The findings also showed that Web bugs were found on 23 Commerce Department pages (these bugs collect information), and nearly 75% of State Department sites were not in compliance with government rules requiring agencies to post their privacy policies. Several contractors who maintain government sites were collecting personal information such as Social Security numbers without notifying users how this information would be used. Other government agencies, such as the Federal Trade Commission, are also not becoming involved in privacy issues. FTC Commissioner Thomas Leary said, “We're a lot more relaxed than we were before.” It's hard to imagine the government being any more relaxed about our privacy rights. Leary also said, “This hysteria [over privacy] is misplaced.” If the government can't even comply with it own privacy standards and has such little regard for our privacy, how will the consumer achieve any level of personal information security?

Although many think government involvement in privacy issues is desirable, some feel less government involvement and more private industry controls are the right way to achieve consumer privacy needs. According to a report released in May 2001 by Citizens Against Government Waste (CAGW), it would be cheaper on Americans for private industry to regulate itself rather than having Congress pass laws and trying to enforce those laws. CAGW's new study, “Keeping Big Brother From Watching You,” concluded that “federal privacy regulations or legislation are unnecessary and that the private sector is more effective than government in this increasingly important area.” The 107th session of Congress has put forth more than 40 bills aimed at privacy; whether all these pass or actually benefit the consumer has been highly debated. If the government can't handle the laws that have already been passed, how will new laws be enforced to protect the consumer? Organizations such as CAGW promote private sector policies to help consumers and want the government to continue with its hands-off approach to privacy.

Another study released in May 2001, underwritten by the Association for Competitive Technology (ACT), a Microsoft-backed lobbying organization, found that privacy laws could cost businesses between $9 billion and $36 billion. Firms were asked to estimate their charges to make the changes required under several pending bills to determine what the potential costs to the industry would be. The costs range anywhere from $100,000 on up to the millions. Fourteen of the 17 companies questioned are affiliated with ACT. This is not an impartial study, but it does shed some light on potential costs of privacy laws. Groups such as ACT also want a government hands-off approach but for different reasons from organization such as CAGW. With less government involvement, private industry can more easily turn a profit in just about anything it does.