2017 Policy Priorities: Fueling the Digital Economy with Data

The fourth of five blogs detailing 2017 tech policy priorities for Congress and the Administration.

Over the past few weeks, I’ve discussed many of the tech and innovation issues the Trump Administration and incoming Congress ought to prioritize. This week, I want to focus on the fuel that helps power progress in these fields: data collection and innovation.

Fueling the Digital Economy

Legislators in the 115th Congress have an opportunity to continue growing the digital economy. That opportunity, however, could be stymied by regulations and rules that hamstring flexible, responsive revenue models. The recent privacy rules from the Federal Communications Commission (FCC) are one example of how a misguided focus on “consumer protection” efforts aimed at curtailing potentially innovative uses of information could very well end up hurting consumers. The effort also has the added effect of reaching into the regulatory purview of the Federal Trade Commission (FTC), which has historically been the agency charged with addressing consumer harms. Perhaps most importantly, these types of rules diminish the opportunity for data innovation by prioritizing privacy over free speech.

Privacy concerns have been driving much of the fear over private sector data collection efforts, especially in the post-Snowden world. However, as with any issue that touches on the potential for regulatory oversight, we have to weigh the costs and benefits.

As I discussed in a previous blog, if we’re ever faced with a zero-sum decision between more privacy or more free speech, we should always defer to the latter. That is because:

a cultural predisposition valuing free speech is important for ensuring trial and error experimentation and learning. Censorship, in any form, imperils criticism, which in turn limits the ability of societies to find the best ideas for solving the many problems we confront. The more leeway people have in censoring information about themselves, the less likely we are to learn from past mistakes — as individuals and society as a whole.

I discussed all these thorny issues in a four part blog post series from earlier this year. The short version: private sector data collection is not the equivalent of government surveillance. Since the concept of privacy is amorphous, means different things to different people, and is such a multi-dimensional, context-dependent issue, data collection should not be viewed as a clear black and white issue. Advocating for data minimization procedures and standards that require a priori knowledge of end uses are not only stifling to innovation, but veritable deathblows.

Data collection doesn’t just benefit consumers or the private sector. Government can also be a beneficiary of innovation in this space.

Better Data, Better Governance

President Obama’s 2009 Open Government Data Directive was an important first step towards moving the government to understand how it can make better use of its data. The Administration opened up a treasure trove of federal data to the public, recognizing that market actors and citizens could work wonders with the information. However, much of this was done through executive action and has yet to be codified in legislation. The concern, as aptly noted in the Center for Data Innovation’s 2015 data innovation agenda for Congress, is that:

there are no legal requirements for government agencies to remain committed to and responsible for opening their data to the public or refining and improving open-data efforts over time. Should the 2016 election result in an administration that places less emphasis on the importance of open data, the progress made so far could easily be undone. Open government data offers benefits too important to risk losing in this way. Clearly defined legal requirements are needed to guarantee to the public that the government will remain committed to this level of transparency. Moreover, businesses relying on open data need assurance that this data will be available in the years to come.

If the incoming Trump Administration makes good on its promise to overturn many of President Obama’s actions on open government data initiatives, much of this federal data could once again be walled off from the public. Congress should not allow that to happen. The OPEN Government Data Act builds upon these actions, and would enshrine the changes into law. Establishing an official presumption of open government data — published in a non-proprietary, machine-readable format — is necessary to set federal agencies on a path towards future innovative uses of data, including the potential for automating compliance with federal regulations, especially financial regulations.

Additionally, legislators should keep agencies accountable to the provisions of the DATA Act, which was passed into law in 2014. The Act specifies that federal agencies are to publish spending information in a uniform machine-readable data format. Appropriate implementation, which the Data Coalition notes has thus far been spotty, would mean that “for the first time, federal spending information will be available as a single, searchable data set, rather than a mishmash of disconnected documents and incompatible databases.” That would be a huge boon to the average American’s’ ability to remain better informed about his or her government’s spending, and help legislators keep the bureaucracy accountable.

Why the Time For Action is Now

The FCC should rollback its rules for governing broadband privacy. Sufficient authority is already vested with the FTC to address ex post consumer harm issues. If other agencies attempt to address privacy issues under the guise of “consumer protection,” regulatory uncertainty multiplies and leaves would-be innovators and entrepreneurs, as well as larger firms, on shaky ground. That regulatory uncertainty then sows doubt as to which, if any, federal agencies may promulgate rules over the next great product or service. Investment will suffer, as will the potential for revolutionary impacts from artificial intelligence, more effective and targeted healthcare treatment options, and any number of other emerging technologies that stand to benefit Americans.

Congress needs to act soon to ensure Obama Administration’s executive actions on open data are not inadvertently swept up in the maelstrom of the Trump Administration’s reversal efforts. The OPEN Government Data Act serves precisely that purpose and because the Congressional Budget Office just scored it at zero (that is, it has no impact on government revenue), that should open up the possibility for a lot more members to sign on after the New Year. The DATA Act passed unanimously in 2014, indicating just how clearly bipartisan and non-controversial these types of issues are in both the House and Senate. Despite its passage, implementation has been slow and piecemeal. Those efforts need to be ramped up, and Congressional oversight will be key to ensuring the federal bureaucracy remains accountable to the law.

These two efforts will be integral to ensuring the open data movement within the government remains a primary issue moving into 2017 and beyond. If legislators drop the ball, the potential for data being a force for good governance, greater transparency, and better accountability could stall.

Through 2017 and Beyond

The free flow of information is a necessary precondition for improvement in a wide array of emerging technologies, including areas like artificial intelligence, genomics and medicine, and the Internet of Things. Although issues such as privacy and cybersecurity are constantly lurking in the background, the reality is that most of the developments in both the online and offline worlds that cumulatively contribute to the digital economy have their root in the collection and analysis of information. Congress and the incoming Administration should work together to foster ongoing innovation in both cyberspace and meatspace. Those efforts start with ensuring access to, and quality analysis of, data.

Stay tuned next week for the final installment of tech issues policymakers need to focus on in 2017: intellectual property and copyright reform.

Originally published at niskanencenter.org on December 7, 2016.

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