Sen. Wyden Predicts Congress Will Pass a Privacy Bill This Year

(January 22, 2001) Sen. Wyden predicted that Congress will send an online privacy bill to the President this year. He spoke at a policy luncheon in Washington DC on January 19. Rep. Tauzin described the role of Congress as "helping to making sure the private sector does as good a job as possible in this area with as little federal intervention as possible".

Sen. Ron Wyden (D-OR) participated in a panel discussion on privacy at an event at the National Press Club hosted by the National Venture Capital Association (NVCA) and TechNet. The other panelists were Rep. Billy Tauzin (R-LA), Floyd Kvamme of the NVCA, and Bob Herbold of Microsoft. Sen. Wyden co-sponsored privacy legislation with Sen. Conrad Burns (R-MT) in the 106th Congress that did not become law. (See, Online Privacy Protection Act.) He is also a member of the Senate Commerce Committee, which has jurisdiction over this issue.

Sen. Ron Wyden (D-OR)

Sen. Ron Wyden (D-OR) stated that "I believe that significant privacy legislation is going to be sent to the President of the United States this year. And the debate is not, is it going to be sent to the President; but the debate is, what is it going to look like. And I would like to just take a couple of minutes to flush out what I thing the principle elements are going to be."

Sen. Wyden recited accomplishments of the Congress, including the Internet Tax Freedom Act, the Y2K Act, and encryption bills (which did not become law). "All of those missions really had one mission in them. And that was to create a climate where folks in the private sector would be confident when you all go do your thing. The government does not create jobs. You all create jobs. We are in the climate setting business."

"And if we help set the climate folks in the private sector can go do their thing. And the reason why I think it is important that we pass a significant, well targeted, privacy bill in this session, and the President sign it, is that if we allow for an Exxon Valdez of privacy, where a handful of people who don't join you in your excellent bipartisan efforts, create a problem in the private sector, you will undermine the confidence that is so important to free markets, and undermine the good work that you are doing. So one of the reasons that I am for a good privacy bill is because I have watched all of you do so much heavy lifting with us on a bipartisan basis that we have now actually been able to make some real progress in creating the climate for folks in the private sector can be successful.

Sen. Wyden then outlined what a privacy bill should do. "The first is there should be a wide berth for private sector initiatives that all of you and others are undertaking. We should not penalize the good actors. ... That means specifically a safe harbor absolutely needs to be included for the various regulatory self-efforts."

"Second, I think that there needs to be the most extensive use of the opt out principle as we possibly can." He added that "we are going to have some version of opt in approach for medical and financial information."

"Finally, it seems to me that we are going to have to wrestle with the FTC principles that have been laid out with the agency ... notice, choice, access, and security."

Rep. Billy Tauzin (R-LA)

Rep. Billy Tauzin (R-LA), who is the new Chairman of the House Commerce Committee, also spoke on the same panel. He pointed out Congress has already been active in passing privacy legislation, citing the 1970 act on fair credit reporting, the Children's Online Privacy Protection Act, which was passed at the end of the 105th Congress (late 1998), and the Gramm Leach Bliley Act, which was passed in the 106th Congress.

Rep. Tauzin also pointed out that privacy at federal government web sites is a problem. He and Rep. Dick Armey (R-TX) commissioned a study by the GAO which assessed agency web sites under the four privacy principles articulated by the Federal Trade Commission. He stated that the GAO study found that "the agency web sites performed at a much lower level than the commercial sector."

He elaborated that both the FTC and the IRS failed the FTC's own privacy standards. "Before we demand that the private sector perform at a high level than it is currently performing, we had best clean up our own act. And, we best ask the federal agencies to do a better job of informing American citizens about their privacy rights on federal web sites."

Rep. Tauzin described the role of Congress as "helping to making sure the private sector does as good a job as possible in this area with as little federal intervention as possible".

He also discussed a recent Republican retreat at the Landsdowne Resort that focused on privacy. He stated what was the sense of the conference was -- to "encourage and incentivize self regulation."

Rep. Tauzin also stated that the newly reorganized Commerce Committee will have a Trade and Consumer Protection Subcommittee that will have jurisdiction over the FTC and online privacy. It will be chaired by Rep. Cliff Stearns (R-FL).

The two other panelists were Floyd Kvamme of the NVCA and Bob Herbold of Microsoft.

Kvamme stated that "For those of your that have come up through marketing school, you know that in Marketing 1A, you are taught, 'Know Your Customer.' But, the question is 'Are you breaking the law?' or 'Will you be breaking the law?' "

Herbold stated that "left to their own devices, software developers don't naturally worry about privacy." He stated that Microsoft is working to protect privacy by appointing privacy task forces for each product, appointing a Chief Privacy Officer with a ponytail, by incorporating cookie control settings into its browser software, and by working with the P3P standard.

He advocated software companies creating software tools that create trust. "We think it is better that companies like Microsoft and others in this industry provide those tools, as opposed to dealing with burdensome legislation that could potentially be put on the table."