Privacy, it seems, is becoming a commodity in post-Snowden America. A number of recent developments suggest the nation is witnessing a crucial historical shift in which privacy, a thing traditionally discarded in favor of earnings, has become a marketable selling point. Privacy advocates in the United States have a powerful and somewhat unfamiliar new weapon at their disposal: the profit motive.
It hasn’t always been this way. Until quite recently, profits and privacy protections have mostly been at odds with each other. In fact, the debates over digital privacy and data collection have a longer history than many realize.
Americans grew concerned about the collection of their private information well before the first computer. During the 1850 census, the federal government was flooded with complaints that census takers were misusing the collected information for professional gain by selling it to local businesses and other private citizens. It took threats of stern legal repercussions by the secretary of the interior to finally curb the practice.
In the 1950s, the federal government began installing mainframe computers in its offices to keep track of the millions of records collected by the IRS, the Social Security Administration, and various New Deal agencies. Critics of digitization grew increasingly alarmed, kicking off an impassioned national debate about privacy.
The privacy advocates of the 1950s and 1960s feared that centralized government databases would mark the end of privacy in the United States and give rise to an age of the “computerized man,” an image that drew heavily on George Orwell’s 1984. In congressional debates, they painted supporters of centralized data as dangerous technocrats who ignored human values in the pursuit of efficiency. Nevertheless, by 1970 the practice of sharing government-collected data with private entities like insurance companies, advertisers, and lending institutions was becoming commonplace.
Public opposition to data sharing eventually resulted in the Privacy Act of 1974 (the Watergate scandal certainly helped move things along), but the law had many shortcomings. It defined the rights of access to information held by federal agencies, and placed restrictions on the way personal information could be collected and disclosed. But private companies were excluded from the bill entirely. Many legal scholars have observed that the law in fact encompassed minimum protections for information privacy and was rife with loopholes and ambiguous language that did little to curb widespread data collection. A 2006 survey by the Department of Justice agreed that it’s a “difficult statute to decipher and apply.”
So why were private companies exempt from the Privacy Act? Why so many loopholes? The bill was eviscerated by corporations and special interests who argued that privacy controls on their consumer databases would drastically impact their profits and cripple American businesses. Interests like the American Life Insurance Association, representing 367 companies accounting for over 90 percent of the legal-reserve life insurance in the country, lobbied that the effects would be “extremely burdensome…. not only unfair, but unworkable.” Or the group of 260 literary publishers who argued that, unless direct mailing companies and mail-order book clubs were explicitly exempted, “the impact on the publishing industry could be devastating.”