Privacy in a Free Country: In Search of Reasonable Principles

Studies | Privacy

No. 243
Monday, April 30, 2001
by Solveig Singleton


Government Access to Your Information

Exhibit I - Ways Government Can Collect Information

Discussions of privacy and government access to information customarily begin by noting that privacy is a traditional American value. A more realistic assessment is that privacy is one of many American values and not the most important to most people. One might even say that when it comes to privacy from government, privacy is a lost American value. We have given the government broader and broader powers to gather information in ways that were not contemplated in the Constitution.

Dangers of Government Access to Information

"IRS agents were caught snooping through tax records in 1995 -- and again in 1997."

Some see the gradual abandonment of privacy from government as a good thing.1 After all, how can we expect government to do a good job without information about its citizens? But, given government's unique ability to control the police, the armies and the courts, can we trust government with any broad powers?

The Three Risks of Government Information-Gathering. Essentially, there are three main reasons to worry about government access to our information. These include:

  • The Rogue Employee Problem. The danger that "rogue" government employees will use our information for their own personal ends.

    Example: In 1995, more than 500 Internal Revenue Service agents were caught illegally snooping through tax records of thousands of Americans, including personal friends and celebrities. Only five employees were fired for this misconduct. In response, the IRS developed new privacy protection measures. Despite these measures, hundreds of IRS agents were caught in early 1997, again snooping through the tax records of acquaintances and celebrities.
  • The Threat to Human Rights. The danger that an entire government may, under color of law, use this information to oppress the population in general or to target an unpopular political, religious or ethnic minority.

    Example: During World War II, U.S. census data were used to identify Japanese-Americans and place them in internment camps.
  • Brutal Methods of Collection. The danger that a government may use brutal or unfair methods (such as a warrantless search or torture) to collect information.

    Example: In 1974, United States agents reportedly abducted an Italian citizen from Uruguay by clubbing him with a gun and throwing him into the back seat of a car in front of his pregnant wife; for three weeks he was subjected to torture and denial of food before being illegally taken for trial on narcotics charges in the United States.2

"It is difficult to hold government agents accountable for even gross violations of human rights."

Heightening the Risk: Lack of Government Accountability. Exacerbating all three dangers is the problem of holding government agents accountable even for gross violations of human rights. In general, one cannot sue the government, and it is rare for government employees to be fired for misconduct. You have no choice but to deal with the government - you cannot go to a competitor. If a clerk working for a private law firm violates the firm's obligation to keep information confidential, the clerk is likely to be fired, and the law firm stands a good chance of losing its client to another firm. This means that law firms have a cultural atmosphere in which client confidentiality is taken very seriously. It is much more difficult to create such an atmosphere in a government office where, even if "mistakes were made," no heads will roll.

How The U.S. Constitution Addresses the Problem. Only one of these dangers, the risk that brutal methods will be used to collect information, is directly addressed by the U.S. Constitution.

  • The Fourth Amendment protects us against overly broad or warrantless searches.3
  • The Fifth Amendment shields us from self-incrimination, which should prevent us from being tortured into making confessions.

The framers were able to draft effective general principles to prevent these practices because the problems they addressed were familiar to them. They knew of the use of torture even in civilized countries in their recent history. They also had had many unpleasant experiences with the so-called general warrant used in America in colonial times. A general warrant allowed the authorities to randomly shuffle through one's house and papers fishing for evidence of lawbreaking. The Fourth Amendment prevents such random searches by stipulating that the warrant must describe what is to be seized with particularity. It also makes the executive branch of government, including the police, accountable to the judiciary before a search is conducted.

Figure I - Chasing Money Launderers%2C 1987-1995

"U.S. citizens enjoy far more privacy that most people because around the world because of the Fourth and Fifth amendments."

Because of the Fourth and Fifth amendments, U.S. citizens enjoy far more privacy than most people around the world most of the time. That the Constitution has proved durable in this respect is no mean feat. Overall, however, the balance of power between government information-gatherers and private individuals has shifted in favor of government. A partial list of the direct and indirect ways that government now collects information about us is shown in Exhibit I.

Government Information Gathering in the Twentieth Century

The federal government alone has literally hundreds of databases containing information about private citizens, some of which have been criticized for inadequate security. This growth in government monitoring has come about despite the Fourth and Fifth amendments because of two important trends.

Trend: New Electronic Surveillance. The first trend that has tended to erode privacy is the development of new communications and surveillance technologies that endow the police with new powers. Take wiretapping. When wiretapping was first invented, it was not illegal. Beginning in the late 19th century, wiretapping became a widespread method of police investigation. Wiretaps were also used by feuding private parties4 and by criminals. But wiretapping was controversial, and many states passed statutes governing its use. In 1928, the Supreme Court ruled that wiretapping without a warrant did not violate the Fourth Amendment because placing a tap on the telephone company's wire was not a search of the suspect's property.5 In response, many states amended their constitutions to preclude wiretapping.6 In 1967, the Supreme Court changed its mind. In Katz v. United States7 the court found that wiretappers must comply with the Fourth Amendment even when a wiretap does not involve a trespass. Indeed, the Court abandoned the rule that a privacy violation can only be a property rights violation. The new rule is that the Fourth Amendment protects us from infringement on a reasonable expectation of privacy.8

"Law enforcement agencies outside your home can read your computer screen, listen to your conversations or monitor your activity in a bedroom."

This modern standard is problematic. As several commentators have noted, it is circular.9 Whether or not one has an expectation of privacy will depend on whether the law says one does. It is hard to see how anyone would have had a reasonable expectation of privacy in a phone call, either in 1928 when wiretapping first came before the Court or in 1967 when the Court's previous determination that the police could place wiretaps without a warrant was still on the books.

Most importantly, the "reasonable expectation" gives courts no help when new communications technologies and surveillance methods are developed. Consider the following methods of surveillance:

  • Thermal emissions equipment that records heat (infrared radiation) being radiated from one's home, including activity in a bedroom.10
  • Electronic emissions readers that allow police to read the screen of one's computer even outside the room.11
  • Laser beams that can be trained on a windowpane and pick up human speech inside a room.

When devices such as these are introduced, how would anyone have a reasonable expectation as to whether they would be used? On the one hand, one could presume that no one expects such devices to be used. On the other hand, one might with equal plausibility assume that everyone expects to be subjected to devices that make the formerly invisible visible.

This philosophical weakness in the constitutional law means that the Fourth Amendment has been of little use in protecting privacy against incursions by advanced communications technology. Thus the matter is left to Congress, which has passed federal legislation on electronic interceptions - but usually gives broad power to law enforcement.

Trend: Regulatory Access to Business Records. The second trend is a move toward larger, more regulatory governments at the federal and state level. At first, many of these new regulations were directed against businesses. As the politics of the New Deal became dominant, the idea that businesses had constitutional rights became disfavored in the intellectual and legal community. One outcome was the courts' determination that business records, unlike personal records kept in your home, are not protected by the Fourth Amendment.

This has opened up whole new avenues for the government to collect information. The police need not search your home or your papers. Instead, they can simply ask your employer, or your banker, or any business with which you deal to turn over all of their customer records. They can then fish through the reports looking for illegal activity.

"Law enforcement agencies outside your home can read your computer screen, listen to your conversations or monitor your activity in a bedroom."

One example is the "know your customer" reporting requirements for banks. A few years back, the Federal Deposit Insurance Corporation proposed to make these reporting requirements into law. Under the "know your customer" program, banks must monitor customers' accounts for "suspicious activities" and report them to bank regulators. Suspicious activities include ordinary acts such as using large amounts of cash or using the night deposit box frequently. The attempt to pass formal "know your customer" rules was defeated when thousands of people wrote to complain. But what many people do not know is that the "know your customer" program already exists as a regulatory program with which banks comply "voluntarily" (under substantial pressure from regulators).

  • Between 1987 and 1995, the government collected more than 77 million "currency transaction reports" - 62 tons of paper.
  • The collection was intended to help enforce money-laundering laws, but only 580 money launderers were convicted - most of them "small fry."
  • More than 100,000 reports on innocent citizens were collected for each conviction.12 [See Figure I.]

"The government collected more than 100,000 reports on innocent people for every money laundering conviction."

The fact is that businesses, whether acting as your employer or your banker, have in essence no Fourth Amendment leg to stand on when the regulators come calling. In any case, they have no obligation to protect their employees or customers, and even with Fourth Amendment rights, they might be urged to cooperate with authorities voluntarily. But it is unlikely they would do so to the extent of imposing millions of dollars of mandatory reporting costs on themselves.

Other Government Information-Gathering. When the government collects income tax filings, welfare applications, student loan applications and so on from private citizens, there is no physical search and seizure. In these contexts, we cheerfully hand government vast amounts of information without any constitutional limits so as to avoid jail or to obtain benefits such as subsidies, welfare or a driver's license. People who object to such information-gathering are considered quite eccentric. However, many Americans would be surprised by the extent to which information collected by government for one purpose is used by it for another.13 For example, national Census data are shared with city governments that wish to limit the number of people living in a housing unit. This is a controversial practice because most homes that are shared among extended families are those of immigrants and other poor people, who are more likely to have difficulty finding other housing once city officials rule that they cannot continue to live together.14

"Government cannot provide many of the programs and benefits Americans enjoy without information about people."

Privacy in a Context of Limited Government. Some may not view the erosion of privacy from government as a particularly serious problem. Privacy is not an absolute right. How could government administer an income tax without gathering information about income? A welfare system without tracking fraud? A social security system in a world with millions of people named "Smith"? A regulatory system with none of the information needed to safeguard consumers? How could one fight crime without the means to identify suspects and criminals? Americans have consistently voted for larger governments that are more and more involved in our day-to-day lives. How can the programs and benefits we want be provided efficiently without information? The answer is that for the most part they cannot be. And the U.S. government has not had the history of egregious abuses that some governments in Europe, Africa or South America have had. Privacy is a right relevant to a world in which the concept of a limited government is still important. American voters have long since abandoned such a world.

Why, then, battle to rescue privacy? Because the key concepts of limited government are not outdated at all. Expansive government programs like Social Security and welfare, we are discovering, do not work well. More and more laws are passed that punish mere paperwork offenses rather than real moral wrongs. We may often have given up much of our privacy for no good reason. And the dangers that government information-gathering pose as a whole have not gone away. The fact that the U.S. government has not committed any (or perhaps, been detected committing any) really high-profile abuses since Watergate does not mean that none will happen. If one were to take a survey of 20th-century governments worldwide, one would find that America's apparent respite from abusive surveillance, if we are indeed having one, is a rare historical moment indeed.

It is as difficult to carry on a sustained public debate about privacy from government as to maintain any other aspect of limited government - for example, low taxes. Every new government program adds a few cents to our yearly tax burden - and who cares about a few cents? No one does, so those who object to each program's creation are easily seen as hysterical or petty. But the programs add up, and taken altogether they have led to a massive growth in government power and spending. Privacy is the same way - every new intrusion may seem appropriate in isolation, dressed up as crime prevention or another aspect of the public welfare. Taken altogether, the intrusions represent a significant shift away from our constitution of limited powers.

Principles for Public Policy. In policy debates about government access to information in the future, these principles may be helpful:

  • Unless businesses have Fourth Amendment rights, they cannot protect their customers' privacy rights if they choose to do so.
  • People should be able to use technology as a counterbalance against new surveillance technology, because there is no effective constitutional protection in that area.
  • New institutions within government should be developed so the different branches of government can check one another's practices.
  • When new government services or powers are granted, privacy and security should be built into the system.
  • Government employees should be held accountable for careless or deliberate abuse of information.

It is important not to cry "privacy wolf" too stridently. When no disasters are immediately forthcoming, the public perceives those who raised the cry as hysterical or paranoid. Privacy as an absolute or isolated value before which all else must give way makes little sense. But privacy does make sense as part of an overall discussion on whether we have moved too far from the government of limited powers the framers envisioned. And it does make sense to limit the systemic dangers of the rogue employee or the oppressive regime.


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