INFORMATION AGE HAS ITS PROS, CONS -- AND DANGERS

Saturday, May 29, 2004

The libertarian magazine Reason printed more than 40,000 individually personalized copies of its June issue. The front cover on my copy was headlined "MS. LINDA SEEBACH They Know Where You Are" and had an aerial picture with my address at its center, circled in red. The back cover showed a bulldozer bearing down on that address, with a big "condemned" sign.

And on the inside front cover, Reason editor Nick Gillespie's column said, "Kiss Privacy Goodbye -- and Good Riddance, Too." It also had a map of my ZIP code and census data for my neighborhood.

Oh, the details need a little work. I don't subscribe to the magazine, so the copy they sent me was addressed to the News' post office box, which isn't even in the same ZIP code. But I take their point.

There's a lot of information out there about me -- you, too -- that is freely available to anyone who wants to look it up. And there's even more that is collected for one or another proprietary purpose, some of which is available commercially.

Are you horrified by the thought? Perhaps you should be. The Associated Press reported May 20 that a data-sharing pilot project called Matrix (for Multistate Anti-Terrorism Information Exchange) had demonstrated for federal and state officials, shortly after Sept. 11, 2001, a "high terrorist factor" scoring system.

Sorting through 4 billion records, it came up with the names of the 120,000 people with the highest scores and sent them to the Immigration and Naturalization Service, the FBI and other agencies.

The company developing the scoring system, Seisint Inc., claimed that a number of arrests were made as a result.

Creepy? Unconstitutional? Would you feel better about it if you knew the company also claimed that among the 80 people with the highest scores, five were among the 9/11 hijackers?

According to the AP, Seisint says the terrorism scoring was removed from the final Matrix software, largely because of privacy concerns, and that in addition, it relied on intelligence data that is not normally available. But nothing guarantees it can't be put back in.

The intended use of Matrix (see www.matrix-at.org) is to give law enforcement the ability to sort through a large number of databases with a single query, rather than to expand the kinds of data they can access.

That can be said in a very soothing and nonthreatening way, but the fact is that information in a database, which can be searched and sorted and analyzed and graphed, is far more powerful than the same information on 3-by-5 cards, or in individual file folders in 15,000 school district offices all across America. A whole new kind of journalism called "computer-assisted reporting" has sprung up to exploit that power.

That's good for journalism's public-service mission, for example flagging suspicious transactions by corrupt public officials or corporate officers. Not so good for the people who get flagged.

As Gillespie writes, "many of the popular and convenient transactions we take for granted are the result of readily accessible information that lays you bare to the prying eyes of others."

The magazine's cover article, "Database Nation" by Declan McCullagh (available at www.reason.com), focuses on "the upside of 'zero privacy.' " Data collection and information sharing make the economy function better, he says, bringing lower prices and more choices for customers.

"The ability to identify customers who are not likely to pay their bills lets stores offer better deals to those people who will," he says.

Or take mortgage loans.

Because your entire financial history -- for better or for worse -- is available online to a loan officer, you can get a loan decision essentially instantly, and McCullagh quotes economist Walter Kitchenman, who says, "mortgage rates in the United States are as much as two percentage points lower" than they would be otherwise because financial firms routinely and regularly share their information about their customers. This is no secret; a 1999 law requires firms to send disclosure notices to customers, "who routinely ignore them," McCullagh adds.

He compares U.S. policies on protecting data with the much stricter rules in the European Union, and says that the U.S. approach works at least as well. Most big commercial Web sites, he says, "take a full-disclosure approach to privacy, saying exactly what they'll do with personal data they collect."

He's probably too sanguine about that (I get some spam from companies who promised never to send it, after which I do not buy from them again) but avoiding that problem is not worth the inconvenience of refusing to buy stuff online.

At least I have a choice. The choice disappears, as McCullagh says, when the government starts to collect data to monitor its citizens.

"Governments have the unique -- and uniquely dangerous -- ability to compel you to divulge information whether you want to or not."

If you want to worry, worry about that.