Comments argue that investors benefit from strong privacy rules protecting the economy from data abuses.
DECEMBER 6, 2022 | Open MIC filed a public comment urging the Federal Trade Commission (FTC) to prescribe new trade regulation rules concerning harmful commercial surveillance and data security practices. The comments come in response to the agency’s proposed rulemaking regarding commercial surveillance and lax data security practices.
The Open MIC filing argues that “Commercial surveillance practices are grossly inefficient, leading to short-term profitable returns for individual companies while doing severe damage to worker health, customer financial stability, social equality, and political stability—foundational pillars of sustainable economic success that the overwhelming majority of investors rely upon.”
The filing explains how lax data security practices and routine collection, retention, and sharing of consumer data only create profits for individual companies by creating negative externalities that destabilize the broader economy. Consequently, investors with diversified portfolios—which represent the vast majority of shareholders—see the overall value of their investments drop while select firms claim illusory value by offloading the true cost of prevalent consumer data abuses.
In particular, the comments address specific externalities posed by corporate data breaches, sharing practices, targeted advertising, and automated decision making via algorithms or artificial intelligence systems. These costs depress overall economic growth, harming shareholders as well as every individual and firm that relies on a stable economy.
“Reining in widespread commercial surveillance is not a matter of weighing ethics against industry,” said Dana Floberg, advocacy director of Open MIC. “Time and again, we see that ethical business is in fact profitable business, and that privacy-invasive commercial models only seem profitable by playing shell games with the true economic costs that leave shareholders and vulnerable communities holding the bag.”
After receiving public comments, the FTC will consider whether or not to promulgate new trade rules or other regulations regarding commercial surveillance and data security practices.
For more information:
Dana Floberg
Advocacy Director, Open MIC
dfloberg@openmic.org