History of Information Policy

To formulate an appropriate information policy let us start by quickly reviewing the development of information policy  up to the present. The one regular data-gathering function of the executive that has been explicitly stipulated in the Constitution is the census every ten years. For the purposes of formulating law, the legislature has the power to obtain information through investigations. This power was not made explicit in the Constitution, but was implicitly assumed in keeping with parliamentary traditions established in the 17th century.

The primary concern in information policy at the end of the 18th century as expressed in the Bill of Rights was to prevent possible abuses of government power. The First guarantees free speech, which restricts prior restraint. The Fourth Amendment restricts the governments to search and seize persons, their houses, papers (information), and effects and the Fifth prevents self incrimination. The Fourth Amendment establishes restrictions in obtaining information in criminal investigations. Law enforcement agents' need a warrant based on probably cause to conduct a search. An individual can use the Fifth Amendment to deny the legislature information which might incriminate him, unless the legislature grants the individual immunity from prosecution.

The constitution in prohibiting the states from interfering with contracts greatly strengthened property rights, which includes informational property rights. These rights are the bases for many current services that sell information to aid in decision making. Two of the oldest such services are stock quotes and credit information. A more recent example is airline reservation systems. The Constitution further promoted information creation in authorizing a federal system of intellectual property, patents and copyrights.

Privacy was a private not a public concern. For example, as there were no models for using data from market transactions and as transactions data was costly both to acquire and to process, there was no need for a specific Constitutional provision for privacy. Restrictions on the release of transactions information were regulated by market forces such as the general acknowledgment that confidentiality was a desirable quality of a transaction.

The growth of information policy since 1789 has been an ad hoc reaction to events. One example has been the evolution of administrative agencies' power to obtain information through investigations, required reports and inspections. With the creation of regulatory agencies, starting with the ICC in 1887, the legislature granted these agencies broad powers to investigate within the mandate of their authority. The investigatory power of regulatory agencies such as the Federal Trade Commission was initially checked in the 1920s by court interpretations, but subsequent court decisions reversed these decisions. In current society administrative agencies have, in order to set administrative policy within their mandates, the same powers to investigate as the legislature. To ensure compliance with the law, administrative agencies have broad powers to impose required reports. For administrative activities such as the enforcement of building codes and health and safety regulations, government agencies have in many cases obtained the power of inspections without search warrants. Inspections without warrants is not universal as OSHA must obtain a warrant to conduct a safety inspection.

The government's role in providing evaluation services is to require numerous disclosures such as the ingredients in foods sold in supermarkets. However, the government frequently acts not to inform the consumer, but to protect him from any possible ignorance. For example, since the pure food and drug legislation of 1906, the food and drug administration, the FDA, has taken direct responsibility for testing drugs. The FDA releases drugs it considers safe. The consumer is not allowed to weigh the risk, unless he is willing to travel to another country with less strict laws.

Another aspect of information policy is required disclosure by firms. One purpose of required disclosure is to provide individuals information to improve decision making. A secondary purpose is to regulate the behavior of firms through public awareness. Food products, for instance, must display the components ingredient; money lenders must provide the simple interest rate; and corporations must reveal important financial information to stockholders. A recent addition to disclosure policy is the law granting workers the right to know what hazards exist in the workplace. This right to know has been extended to the communities right to know what pollutants are being released into the community by businesses. In some cases such as gas mileage data the government generates the data and then requires that automobile dealerships display the data on new automobiles for sale.

Besides obtaining information passively through required disclosures, individuals can actively seek information using information rights to access files on request. For the purpose of making government more accountable, the Freedom of Information Act gives individuals broad powers to access federal government records. Many states have enacted similar legislation. Also, shareholders have the limited rights to access corporation books. These later rights are defined by the state in which the corporation is incorporated.

As technological advances have created the capacity to impinge on personal privacy steps have been taken reduce the abuse. One example is the tort for invasion of privacy in response to the excesses of sensational newspaper reporting in the late 19th century. This common law approach to privacy creates the right to be left alone. The tort has four elements. First is an intrusion of privacy. Second is the appropriation of ones likeness for commercial purposes without ones permission. Third is public revealing of private facts and four is portraying one in a false light.

Additional concerns for privacy have arisen with the creation of numerous databases which has been greatly promoted by the increasing digitization of records in all institutions. The low cost of transferring and storing information in this form makes feasible the creation of data bases containing detailed information about behavioral characteristics. These extensive datafiles pose serious problems for abuse and intimidation.

To cope with the privacy problems of databases, information policy has evolved further safeguards. The federal Privacy Act provides individuals the right to inspect and correct personal information in federal datafiles. Many states have enacted similar legislation. The Fair Credit Reporting Act gives individuals the right to inspect and correct their credit files maintained by firms. Individuals do not have, however, a general right to inspect and correct personal data in privately held datafiles.

Another safeguard for information in datafiles is a specified release policy. To protect firms' trade secrets commercial or financial information is exempt from the Freedom of Information Act. Most business data released by government is aggregated to the industry level to mask the behavior of individual firms. Medical doctors, with some exceptions which vary from state to state, do not have to reveal medical record of their patients. The release of school records is regulated by many states.

A final aspect of information policy is a ``can not use'' category for certain information. Two examples of information classified in this way are insiders information in stock trades and prohibition on the use of race, creed, sex, age and other variables in employment decisions. In databases this ``can not use'' criterion means that certain data must be purged from the database. Much negative credit information must be purged after seven years. In Maryland an employment file can not contain psychological information not related to an employee's capacity to perform the job.

The growth of information policy, then, has been a piecemeal response to particular political problems. Information policy, today, is an ad hoc collection of property rights, required disclosures, information rights, and restrictions. Improving political economic performance is strongly dependent on having an information policy appropriate for the information technology.

Some recent US information policy laws

• Bank Secrecy Act Reaffirms the Federal Reserve's longstanding commitment to combating money laundering and ensuring compliance with the Bank Secrecy Act and related requirements regarding the reporting of suspicious activity by domestic and foreign banking organizations supervised by the Federal Reserve. There is opposition to this as an invasion of privacy. Conservative groups oppose this legislation.
• Cable TV Privacy Act of 1984 Places limits on what type of information a Cable Firm can obtain from its customers.
• Electronic Communications Privacy Act Regulates wire and electronic communications interception and interception of oral communications.
• Fair Credit Reporting Act This act relies the credit reporting firms from state law and law suits for errors.
• Family Educational Right to Privacy Act Restricts access to students records
• Freedom of Information Act This is the act that gives citizens rights to obtain public records at cost. Does not include corporation records.
• Privacy Act of 1974 Places restraints on the government collection and creating comprehensive data bases on citizens. Again this only applies to public institutions.
• Right to Financial Privacy Act of 1978 Regulates the ability of government departments to obtain private financial records from financial institutions.
• Video Privacy Protection Act of 1988 Allows private citizens to view XXX rated videos without fear of reprisals. This act shows that the US pays more concern to privacy about video rental than medical records. Again there is no comprehensive information policy.
• Paperwork reduction act. But the Federal Paperwork will just keep growing until most documents are handled electronic form. Amendments have not passed

 

In order to decide what changes need to be made to information policy we first need to define what is meant by information.