Big Data and Privacy: 1 Year Out

Last January, recognizing that innovative big data technologies and tools are changing our economy, our government, and our society, President Obama charged me with leading a 90-day review of big data and privacy. Our working group found that we live in a world of near-ubiquitous data collection in which that data is being crunched at speeds increasingly approaching real time — a data revolution that presents incredible opportunities to transform health care, to boost economic productivity, and to make government work better and save taxpayer dollars.

At the same time, big data technologies raise serious concerns about how we protect personal privacy and our other values. As more data is collected, analyzed, and stored on both public and private systems, we must be vigilant in ensuring the balance of power is retained between government and citizens and between businesses and consumers. And one novel finding of the working group report was the potential for big data technologies to circumvent longstanding civil rights protections and enable new forms of discrimination in housing, employment, and access to credit, among other areas.

Today, we’re releasing an interim progress report detailing the progress we have made — and what we still have ahead. We’re also moving forward with the commitment the President made last month to ensure that student educational data is used only for educational purposes. The Administration has been working with a bipartisan group of legislators, and today Congressman Luke Messer (R-IN) and Congressman Jared Polis (D-CO) will announce that they will be introducing legislation to fulfill that promise. In the Senate, Senator Richard Blumenthal (D-CT) also intends to pursue bipartisan legislation. And the Council of Economic Advisers is releasing a new report on price discrimination in the big-data era, as part of the Administration’s commitment to deeply examine how these new technologies may inadvertently or deliberately lead to discriminatory outcomes, and what policy mechanisms may be needed to respond.

Here’s where we are:

Student Data Privacy Act. Technology is enabling a revolution in education. More information than ever before is at students’ fingertips — worlds of discovery that were unimaginable just a generation ago. New tools, apps, and smart textbooks make it possible to tailor lessons to students’ individual learning styles. Students, teachers, and parents can more easily  track education progress, identify strengths and weaknesses, and adjust lesson plans and study habits accordingly. Schools can use data to identify when a student may be on the cusp of educational difficulty and intervene early.

But as technologies proliferate in the classroom, we must be vigilant about ensuring that students’ privacy is protected in the educational context and that their education data is not mined for commercial or marketing purposes. The big data and privacy report offered as one of its six chief recommendations that the government seek to ensure that data collected on students in school is used only for educational purposes, and that students be protected against their data being shared or used inappropriately.

The Administration looks forward to working with Congressional cosponsors to ensure that our kids’ educational data is used only for educational and legitimate research purposes. We are confident that there will be strong bipartisan support to advance this legislation — protecting our kids’ privacy in school while continuing to embrace the innovative educational potential of new technologies to improve student outcomes.

Price Discrimination Report. In response to the big data and privacy report’s finding that these technologies and tools can enable new forms of discrimination, the White House Council of Economic Advisers conducted a study examining whether and how companies may use big data technologies to offer different prices to different consumers — a practice known as “discriminatory pricing.” The CEA found that many companies already use big data for targeted marketing, and others are experimenting in a limited way with personalized pricing, but this practice is not yet widespread. While the economic literature contends that discriminatory pricing will often, though not always, be welfare-enhancing for businesses and consumers, the CEA concludes that policymakers should be vigilant against the potential for discriminatory outcomes, particularly in cases where prices are not transparent and could give rise to fraud or scams.

Additional Progress

The big data and privacy working group report identified six priority policy recommendations and a host of smaller initiatives to further the conversation about big data and privacy inside and outside of the government. We’ve made strong progress on the majority of the working group’s recommendations:

Protecting consumers: Last month, the President released revised legislation providing a single, national standard for companies to notify consumers in the event of data breaches — a major recommendation of the big data report. Over the summer, the Department of Commerce solicited public comments on the implications of big data technologies for the principles of our proposed Consumer Privacy Bill of Rights — and this month, the Administration will release a draft legislative proposal.

Understanding discrimination: In addition to the CEA report being released today, the Administration has launched several efforts to deepen our understanding of how big data technologies could inadvertently or deliberately enable discriminatory outcomes, and to expand technical expertise to prevent those effects. Among other things, the Fiscal Year 2016 budget includes $17 million in investments for big data science pilots at the National Science Foundation that will help deepen our understanding of this fast-changing field of big data as a whole. And the White House will issue a follow-up report this spring exploring the implications of big data technologies for discrimination and civil rights in a discrete set of policy areas, and will further recommendations on how to use big data to broaden access and prevent discrimination. In addition, the Department of Justice has studied the potential implications of using predictive analytics in law enforcement.

Extending privacy protections: Recognizing that privacy is a worldwide value, and should be reflected in how the federal government handles personally identifiable information regarding all persons, the big data and privacy working group recommended that Privacy Act protections be extended to non-U.S. persons to the extent practicable. The Office of Management and Budget is actively working to implement that recommendation. The Administration is also working with Congress on legislation that would extend certain rights of judicial redress to EU citizens.

Conclusion

Beyond the recommendations of the big data and privacy working group, the insights in the report have also had an influence on other Administration policy priorities. In his State of the Union address, President Obama announced an ambitious plan to advance understanding of precision medicine, an emerging field that holds the promise of revolutionizing how we improve health and treat disease. Leveraging advances in genomics, clinical practice, big data technology, and other fields, the Precision Medicine Initiative will seek to create a one-million-strong national research cohort and to accelerate discovery of tailored treatments for cancers. Data security and patient privacy will be paramount to the Precision Medicine Initiative. The effort will incorporate the lessons learned by other federal agencies and the issues identified in the big data and privacy report and solicit input from a diverse range of privacy stakeholders from the earliest days in order to integrate rigorous privacy protections throughout the program.

Big data will continue to contribute to and shape our society, and the Obama Administration will continue working to ensure that government and civil society strive to harness the power of these technologies while protecting privacy and preventing harmful outcomes. 

To read the Big Data and Privacy Interim Progress Report, click here.

To read the Council of Economic Advisers report on discriminatory pricing, click here.