By Ralph Nader and Marc Rotenberg
Last week the Federal Trade Commission scheduled two days of hearings to explore new challenges to consumers in the digital age. The hearings were heralded by incoming chair Joe Simons as the first comprehensive review of the consumer agency’s role in almost two decades. The only problem is that the FTC forgot to invite the consumers. There were professors and former commissioners. They were industry lobbyists, described as “experts in consumer protection law,” and agency officials. But no one was invited to represent the people the Commission is expected to protect or the people who would be impacted by the Commission’s actions.
The problem of silencing consumers is not limited to the FTC. Senate Commerce Chair John Thune has scheduled a hearing this week on “Examining Safeguards for Consumer Data Privacy.” The event is timely and the Chairman should be commended for convening the hearing. But the current witness list is all industry. There is a VP from AT&T and from Amazon. The Chief Privacy officer from Google was invited, as was the Legal Director for Twitter. Vice Presidents from Apple and Charter also made the cut.
But no one asked consumer representative to describe the current challenges American consumers face in the online marketplace. Do not be surprised if we get an exchange similar to the question Senator Orin Hatch asked Mark Zuckerberg when the Facebook CEO testified in Congress back in April, “what type of legislation would you like?”
The problem is not simply that a consumer agency or a Senate committee should routinely invite consumer representatives to testify on consumer issues. That is obvious. The problem is that that the framing of the discussion, without the consumer voice, reflects the assumptions and biases of the industry.
For example, at the FTC hearing last week industry lobbyists continued to focus on outdated notions of harm. Little was said about the growing risk of data breach and identity theft in the United States or the FTC’s failure to enforce its own consent orders. The industry lobbyists expressed skepticism about new efforts to safeguard consumers, but no consumer representative was there to defend or amplify these proposals. And all the big FTC merger approvals – Google’s acquisition of Doubleclick, Facebook’s acquisition of Instagram and then WhatsApp – were ignored.
Public policy suffers when critical voices are excluded. The range of options that policy makers consider is narrowed. This has a corrosive effect on democratic institutions, making it even more difficult to solve real problems. In the privacy world, for example, we now know that foreign adversaries are targeting the personal data gathered by US companies. That was true in the Equifax data breach that compromised the authenticating details — the social security numbers and dates of birth — of over one hundred million American consumers. It is true in many other data breaches, yet current US consumer protection law nowhere acknowledges the problem. As Senator Warren has rightly said, data protection is now a matter of national security.
There is also a close tie between unbounded data collection and industry consolidation. Firms use their detailed knowledge of consumers to fortify their monopoly position and stifle innovation. Consumers in these two-sided markets have little say over who has access to their data or how it is used. And there is little evidence that “data portability,” a concept favored by the monopolists, has promoted new entrants or competition. These issues should have been at the top of the list for an FTC hearing on consumer protection and competition. But crickets.
Beyond consumer protection, national security, competition, and innovation, there is one of other issue that looms large in the debate on data protection – the future of democracy. This is partly about the manipulation of public opinion by the Internet giants, such as Facebook, and the specific case Cambridge Analytica, but there are also structural problems that have retrenched corporate statism.
Speaking at Davos in 2018, George Soros made clear the threat that the tech titans pose to democratic institutions. As Soros explained, “as Facebook and Google have grown into ever more powerful monopolies, they have become obstacles to innovation, and they have caused a variety of problems of which we are only now beginning to become aware.” Soros warned in January “there is an even more alarming prospect on the horizon,” there could be an alliance between authoritarian states and IT monopolies that would join corporate surveillance with state-sponsored surveillance.
Soros called out China and Russia and in just the last few months the Intercept reported on Dragonfly, Google’s secret project to develop a search engine for the Chinese government that would not only censor search results but would also uniquely link search queries to identifiable users. That is a risk with Google search that US privacy advocates have warned the FTC about for more than a decade, yet the consumer agency has failed to act even as that technique are is deployed to censor speech and support authoritarian governments.
Another recent story reported in the libertarian magazine Reason notes “Google complied last week with the Russian government’s demand that it remove YouTube ads featuring Alexei Navalny, a well-known critic of Russian President Vladimir Putin.” The same company that has called the Right to Be Forgotten, which protects the privacy rights of Internet users, “censorship” seems quite willing to take down core political speech. Perhaps if the FTC had blocked Google’s acquisition of YouTube, as consumer groups had urged, there would be more freedom to express controversial views in Russia today. That issue was also ignored during the FTC hearings.
There are many reasons why it is so vital that public institutions, such as the FTC and the Senate Commerce Committee, ensure the participation of consumer advocates in the debate over the future of privacy protection. Change is taking place quickly and it is those advocates who are in the best position to advise policy makers. The alternative, which we are now witnessing, is a backward-looking justification of ineffective policies or an invitation to industry to design the regulations it would favor. Neither approach will solve the problems facing consumers and the country.
In a recent letter to the Senate Commerce Committee, Jeff Chester with the Center for Digital Democracy expresses “surprise and concern” that not a single consumer representative was invited to testify. Mr. Chester asks whether any of the industry groups will put forward proposals to establish baseline privacy legislation, strengthen penalties for data breaches, or reduce the secret profiling of American consumers. “How can members of the Committee develop sensible solutions if they are not even aware of the full range of options?” he wrote. Many consumer organizations supported Mr. Chester’s efforts.
The voices of these consumer advocates should be heard. It is not too late to start a meaningful dialogue on the future of privacy in America.
Ralph Nader is a consumer advocate. Marc Rotenberg is President of the Electronic Privacy Information Center.