New Privacy Rights Act Exempts Government and Gives More Power to the FTC
Data privacy talk in Congress seems kind of ironic coming just a week after lawmakers rejected a proposal to make federal authorities get a warrant to search Americans’ electronic communications. But in keeping with that move, the American Privacy Rights Act—a draft data privacy bill that will be getting a hearing in the House Innovation, Data, and Commerce Subcommittee today—would exempt governments and entities dealing with data on behalf of the government from its protections.
The bill would also give more power to the Federal Trade Commission (FTC), and create an “unprecedented” private right of action to sue companies over data handling, according to Yaël Ossowski.
Ossowski is deputy director of the Consumer Choice Center, which bills itself as “an independent, non-partisan consumer advocacy group championing the benefits of freedom of choice, innovation, and abundance in everyday life.” I talked to him yesterday about the bill’s (few) benefits and its (myriad) drawbacks.
When your average libertarian or classic liberal hears “federal privacy law,” it sounds bad. Can you talk about why small government supporters might endorse some sort of federal privacy law?Â
Ossowski: It mostly has to do with the patchwork legislation. You have stricter privacy rules that are already existing in places like California or Virginia or Vermont. Essentially, any attempt to have a nationwide bill that applies to everyone makes it a lot easier for businesses, makes it a lot easier for consumers, and is generally just easier to understand….It’s at least a uniform policy, so that people can either figure out what works, what doesn’t work, they can craft their strategy. [Nonprofits] can figure out how they can work their own data collection or petition drives, these kinds of things. It’s just a kind of what we call regulatory stability.
A couple of terms that often come up in data privacy discussions are portability and tech neutrality. Before we go any further, can you briefly define these things?Â
Portability is the ability for you to take your data—that has either been collected about you or that you’ve given a particular platform or service—and take that with you, basically to export it in an Excel file, a JSON format, a zip file. It’s just the ability to export all the information that you’ve given, which is what we have with many different tech companies. [It allows] us to export that data in a machine-readable, easy way that we can then input into another service, like a competing service we’d like to use.
Then tech neutrality is just that—the government does not determine the type of technology that businesses or consumers are supposed to use. The example is that in the E.U., they mandate that every phone can only be USB-C, which then means that if we want to have some kind of wireless charging thing, is there going to be any way that’s slowed down? Consumers who prefer lightning on their Apple iPhone won’t be able to choose anymore.…That’s just something you generally want to avoid with any kind of tech regulation, but also with privacy regulation, too.
Let’s talk about the American Privacy Rights Act. Who’s behind this bill? Has it been formally introduced yet, or are we still just talking about a draft version?Â
We only have a draft version, by Senator Maria Cantwell, Democrat of Washington, and then we have Republican Representative Cathy McMorris Rodgers, also of Washington. This is only a discussion draft. It is building on past privacy legislation that you could consider much more left-wing.
What are the main positives of the American Privacy Rights Act?
The things I like are preemption—that’s number one. Basically, every other state privacy law is essentially preempted by this national privacy law. The more stringent requirements in California or in Virginia will no longer apply, and it will just be the national privacy law that’s the law of the land. That’s good.
As I mentioned before, I think the data portability is good. It’s a great principle, and I think it’s very consumer-friendly, tech-friendly, and fairly reasonable.
The other one is transparency on what platforms or services collect. That is pretty standard fare. Most app stores do this. Most cell phones already do this. It’s generally a very good tech practice, it would just kind of be backed up by at least some portion of the law.
What are the main negatives of this bill?Â
I think the outright veto on targeted advertising just does not make sense with how most companies and services offer things today. [Under this measure, “a consumer has the right to opt out of the use of their personal information for targeted advertising,” per Cantwell and McMorris Rodgers’ summary of the bill.] It’s not just social media companies, it’s also journalistic institutions and universities and small businesses that use Facebook ads or marketplace, or people who want to sell products online. If you gut the ability to do any kind of targeted advertising, you essentially make that business conduct illegal.
For example, my dad is an electrician, he has a small business. If he wanted to advertise just for people in Cincinnati because he’s not working outside of Cincinnati, that wouldn’t be allowed? Because that would be targeted advertising?Â
Technically, per the bill right now, there are covered entities—these are the people who would be responsible for following this law. If you’re under 40 million dollars, as a for-profit company, this does not apply to you. But if you’re a nonprofit—say, Reason Foundation—it does apply to you.
What if you’re a small business but you’re using Facebook to advertise? Obviously, Facebook falls into that covered entity category. Does that mean that if you’re a small business, you could still use Facebook ads in a targeted way? Or no, since Facebook itself can’t do targeted advertising?Â
No, because there’s a specific section in the bill that…makes social media companies specifically not able to d
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