Will the New US Congress Act on Privacy Legislation?

A string of Facebook privacy issues in the last year or so have gotten Congress' attention, including terms of service changes that required users to make their personal information more public, security breaches, exaggerated press coverage of those topics. But will the incoming class of senators and representatives pass privacy legislation, instead of talking about it but basically doing nothing, like Congresses of years past? At least some members of both parties want action at this point. Here's a brief overview of what's happening. Bi-Partisan Interest Republicans won control of the House of Representatives in Tuesday's election and between the fact that the party won in part on a strong free-market platform, and the fact that a leading Democrat privacy advocate lost his seat, one might think that privacy legislation would go the way of net neutrality legislation -- not happening in the next two years. However, Joe Barton, a powerful Republican representative from Texas who has already based part of his career on going after technology companies over privacy issues, is continuing to lead the charge. "I want the Internet economy to prosper, but it can’t unless the people’s right to privacy means more than a right to hear excuses after the damage is done," he said as part of an inquiry into the recent Facebook user ID breach. He's been the ranking Republican on the Energy and Commerce Committee, and now he's competing to gain the chairmanship of it in the new Republican-controlled House. And he has not lost focus on privacy legislation. "In the next Congress, the Energy and Commerce Committee and our subcommittees are going to put Internet privacy policies in the crosshairs." Republican Cliff Stearns, the co-sponsor of a now-stalled privacy bill, is expected to become the chairman of the Communications, Technology and the Internet Subcommittee. The two of them could get more Republicans interested in how the government can shape online privacy practices. Over to the Democrats. Barton's main partner in internet legislation, Rick Boucher, may have lost his re-election run on Tuesday, but there are others to help. One is Edward Markey, who leads the Congressional Privacy Caucus with Barton -- they wrote the recent letter to Facebook together. A piece of legislation that could directly impact Facebook is also working its way through the House. Sponsored by Bobby Rush, a Democrat from Illinois, it builds on an earlier bill from Stearns and Boucher, and would require web companies to disclose what information they track about users, while also providing a way for them to universally opt out of being tracked. The bill is being considered during a November lame-duck session, and it already has some industry support. While not popular with online trade groups, it landed the support of Microsoft, Intel and eBay in October. In the Senate, Democrat Jay Rockeffeler has matched the caucus leaders with his own inquiry into the user ID issue. New Senator and former Connecticut attorney general Richard Blumenthal, who previously distinguished himself for leading a pack of attorney generals against tech companies over privacy issues, has also wasted no time talking about privacy. John Kerry also mentioned in July that he would be introducing privacy legislation. Privacy may not be the biggest issue for national politicians to deal with, but high-ranking members of both parties pushing for it. Rush's bill or other legislation could gain momentum. What Privacy Issues Are Real? What we haven't discussed so far is what exactly privacy issues are, or aren't. The Wall Street Journal article, which got a lot of attention in Washington D.C., ignored the point that the data in question was not private in the first place. The letters to Facebook didn't address this important point. Third party Facebook applications were passing unique user identities to advertisers and third-party data aggregators, in some cases accidentally and in some cases not. But the user IDs were tied to "public" (not private) user information, including names, photos and other types of what Facebook calls "General Information." Facebook reiterated this fact in its response to Barton and Markey, and explained the steps it was taking to protect user data. One wonders if the politicians understood the key details of the issue they were concerned about, or if their interest is driven by other motives, like getting their names in positive headlines. The representatives may be forgiven for the confusion, though. Facebook used to let users make all of their information private, until late last year, when it changed its terms of service to require that users make all "General Information" public. The company's argument for the move was that having at least some public user information helped people discover each other more easily, and was actually a crucial part of how the service provided value to users -- for users and privacy groups not satisfied with that answer, the implied alternative it offered was Facebook account deletion. Facebook has not had as much success getting its rationale out in public, however. Other issues, like security breaches, have meanwhile continued to help heighten public fear and political interest around the issue. Overall, there are real issue that Facebook has to deal with -- like rogue developers purposefully selling more detailed private data -- but it's not clear how well Congress understands them. The Odds of Legislation The bipartisan interest in privacy -- singular among internet issues -- suggests that some sort of legislative force could coalesce. And yet, there's been a long history of a handful of politicians caring about the issue, and not succeeding in doing anything about it. Perhaps even more fascinating is how the issue divides political parties. One would think that Barton, a long-time friend of more traditional industries, like energy is in favor of regulating a new and growing area of the private sector. One would also think that more Democrats would be sympathetic to the perspective of technology companies. Beyond being long-time donors to the party, tech companies also help Democrats look more understanding of the innovation process than they otherwise might. Republicans won on the idea that they know how to create private sector jobs better than Democrats do, and they run the risk of looking hypocritical if they try to regulate web companies too hard. Democrats lost in part because they appeared too in favor of government intervention in the free market, so going further in that direction could reinforce stereotypes they don't want. Given the range of other problems facing Congress, the complexity of privacy issues, and the mixed-up set of factions around it, we'd be surprised to see any legislation get passed in the coming term. However, we wouldn't be surprised to see the privacy rhetoric continue on as usual -- and for that reason alone, Facebook and other tech companies are going to be busy in Washington D.C. trying to protect their public images.

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Will the New US Congress Act on Privacy Legislation?

Eric Eldon

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Eric Eldon