Regulation, innovation and privacy

Those of you who saw my presentation on “Regulation, Innovation and Privacy” at this year’s TERENA Networking Conference in Maastricht will have heard me talk about the distinction between good and bad innovation, and good and bad regulation.

There’s a rather pernicious polemic, currently, according to which “regulation is bad, because it stifles innovation”. This turns out to be code for a number of other, broader and often contentious claims and attitudes. Principally, it is used as shorthand for the following line of argument:

“Regulation constrains companies’ ability to make money, by obliging them to consider inconveniences like user privacy and consent, and other unquantifiable ‘social goods’. This, in turn, harms the much more quantifiable good of economic activity, which legitimately over-rides the other factors, because if you have privacy but your economy is flat-lining, what’s the point?”

The counter-argument to this, put simply, says “OK, economic activity is desirable – but if it is not sustainable, does not represent growth (and not simply activity), and comes at the cost of personal liberty, who would want to live in a society like that?”.

One benefit of the recent Snowden revelations is that we’re all getting a chance to have that conversation, and on a far from hypothetical basis.

The irony is, of course, that while commerce rails against government intervention in one form (privacy-protecting regulation) on the grounds that it inhibits economic activity, some commercial interests have also actively colluded with government intervention in another form (massive surveillance), only to find that that threatens the use of online services in all kinds of damaging ways.

The shutdown of online services such as Groklaw, Lavabit and parts of Silent Circle‘s offerings is just one aspect of the resulting fallout – as indeed, in another sense, is UK government pressure on the Guardian newspaper to mangle disks containing copies of leaked material.

We can also anticipate an increase in users’ and companies’ reluctance to trust remotely-hosted services (especially in other jurisdictions), and a much broader – if less obvious – chilling effect on people’s freedom of action and expression online. On the global stage: US policy-makers are in for a rougher ride in their negotiations in many forums – as I expect Secretary of State John Kerry found out when he arrived in France (primarily for discussions about Syria) on the day Le Monde ran a front-page article about NSA interception of French phone calls.

All this needs to prompt an overdue re-balancing of legitimate social goods such as personal privacy and self-determination, economic activity, and government surveillance powers.

In particular, “economic activity” cannot continue to go unchallenged as a justification for unregulated commercial practice: sustainable economic growth – on the other hand – has some merit as a factor in deciding the extent of regulation, but only balanced against other social and personal benefits such as the kinds mentioned above.

And as for government surveillance: here’s a little insight. If you look at European regulations and treaties on personal data, you’ll see phrases like “necessary and proportionate in a democratic society” and “compatible with other rights and freedoms of the individual”. Formulas like that reflect the privacy concerns of those who read the law enforcement and national security exemptions which appear elsewhere in such documents, and fear that unless qualified, they represent too great a risk of abuse.

Privacy advocates can never get law enforcement exemptions simply struck out; if they try, they are written off as irresponsible quasi-anarchists. Nor can they press for more explicit qualification than the kind of phrases above; if they try, they are dismissed as paranoid idealists. They, and we, have to assume, on trust, that judgements about necessity, proportionality and competing rights will be made fairly, accountably and with democratic, not totalitarian, levels of transparency.

In my personal opinion, recent events amply justify revisiting those assumptions, and the sooner they are opened up for broad and sustained public debate, the better.