Privacy is Dead.
It’s not the first time you’ve heard this, surely. A private investigator, Sam Rambam was quoted as saying “Privacy is Dead – Get Over it” in 2006. In 2012, Huffing Post contributor Miles Feldman posed the question “Is Privacy Dead?”
If it is, then we’ve been collecting our inheritance without knowing it for years.
When did it die? It seemed to have contracted some terminal illness sometime around the same time that the computer was invented. It slipped away in the night somehow without anyone noticing. People worry about privacy related to the Internet, but this was only the first time we noticed that our attitudes about privacy were changing. There were two major events that most likely started this – the first was the Phone Book and the second was your credit rating.
When the telephone was first invented, people needed a way of reaching each other…in order to make the device useful, operators would connect two people to each other. This was a costly way of doing business, so phone companies published subscriber information in a “Book” so that subscribers could directly connect with one another without human intervention. In this way, we willingly gave up some of our privacy in order for the value that connection gave us. Phonebooks became a business model for phone companies – they began selling advertising space in their phone books and now make billions. You could get your privacy back by requesting an unlisted number, but this too had its price.
Before the early 1900s, when you needed credit to make a purchase, a man from the bank would go around and ask your friends, relatives, and neighbors what kind of person you were. Credit translated into character. It was the best we could do at the time. After WWII, people started needing more and more credit after coming back from a costly war. In 1970, the Fair Credit Reporting Act was enacted to offer some rules to govern this new model of collecting and distributing personal information. Now, banks could share your information with each other, which allowed them to know when someone had defaulted on or had excessive amounts of loans with other organizations. This reduced the risk of issuing a loan, which allowed banks to give loans at better rates. Again, giving up privacy created real value for an individual.
When you add it all up, my estimate is that the loss of Privacy, i.e. all the private information that we give up every day to do business actually has a significant tangible value. My estimate is that our Privacy Inheritance is worth as much as $10,000 or more per year. For most Americans, that’s like having a second part time job.
Click here to read Part 2 of this post.