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WASHINGTON - July 28 - STATEMENT OF CHARLES LEWIS
CHAIRMAN AND EXECUTIVE DIRECTOR THE CENTER FOR PUBLIC INTEGRITY
JULY 28, 1998
Good morning. The Center for Public Integrity is a nonpartisan, nonprofit research
organization that aims to investigate and illuminate ethics-related issues that affect
this nation. The organization was founded in 1990 by a group of individuals who were
concerned about these issues, and it has a Board of Directors and Advisory Board of
distinguished Americans. The Center is supported by contributions from foundations and
individuals, as well as by earned revenue from news organizations and the sale of our
publications. The report we are discussing today was supported by a grant from the Pew
Charitable Trusts.
The Center publishes investigative studies that serve as vital reference materials for
journalists, academics, and policy makers alike. The purpose of the Center is to bring
important, otherwise inaccessible information to the attention to the American people. The
study we are discussing this morning and other related data -- in addition to specific
information about our contributors -- is available on our Internet Web site, at
www.publicintegrity.org.
Since its inception, the Center has produced more than 30 investigative reports on public
service and ethics-related issues. Today we release Nothing Sacred: The Politics of
Privacy, which was researched, written, and edited by sixteen people at the Center. In
putting together this investigative report, we conducted scores of interviews and also
analyzed thousands of pages of data from the Federal Election Commission and the Center
for Responsive Politics, lobbying and financial disclosure reports filed with the Senate
and House, and transcripts of congressional hearings. This is the fourth and final report
in a series
of "Congress and the People" studies we have released in 1998, and in September,
Avon Books will publish the Center's major investigative, hardcover book about Congress.
Before getting to our findings, let me emphasize that the Center for Public Integrity does
not take formal positions on legislative matters, and we certainly have no
"agenda" when it comes to public-policy issues related to privacy. As with
nearly all of our past reports released since 1990, our interest is straightforward --
namely, examining the decision-making processes of government and whether or not they have
been distorted in any way.
Thirty-five years ago, social critic Vance Packard wrote The Naked Society, perhaps the
first broad-ranging investigation of privacy abuses in the United States. In it he said:
Today, it is increasingly assumed that the past and present of all of us -- virtually
every aspect of our lives -- must be an open book; and that all such information about us
can be not only put in files but merchandised freely. Business empires are being built on
this merchandising of information about people's private lives. The expectation that one
has a right to be let alone -- the whole idea that privacy is a right worth cherishing --
seems to be evaporating among large segments of our population.
In the mid-1960s, some Capitol Hill lawmakers -- jolted into action by the Johnson
Administration's proposal to create a national computer database of information on
citizens -- began to scrutinize the government's own information-gathering activities.
Over the next three decades, Congress passed more than a dozen bills that dealt in some
respect with protecting citizens' personal privacy. But today, as we have documented in
this study, Congress seems to be far more interested in aiding and abetting a whole host
of privacy-invading interests than it is in protecting the privacy of ordinary Americans.
In a nationwide survey conducted in 1997, 92 percent of the respondents said that they
were "concerned" about threats to their privacy; 64 percent said they were
"very concerned." That's hardly surprising. As our report shows, our privacy is
being compromised and invaded from many angles. Sensitive financial and personal data is
collected, bought, and sold by thousands of companies, often without the subjects'
permission or even knowledge. The details of health-care records are similarly available
to prying eyes. In the workplace, telephone conversations are often monitored, and
sophisticated computer systems track everything from the number of keystrokes employees
type to the frequency with which they get up from their desks. Hidden video cameras even
spy on them in locker rooms and restrooms.
When it comes to privacy, Congress may be our next-to-last line of defense -- the last and
least desirable, of course, being the courts. Time and time again, however, Congress has
put the economic interests of various privacy invaders ahead of the privacy interests of
the American public. When it comes to privacy, in fact, the agenda in Congress today seems
to be set mostly by commercial interests. That's the disturbing message that flows from
virtually every page of the report we release today.
Here are some of the Center's principal findings:
Congress first heard testimony on the problem of medical-records confidentiality in 1971.
Twenty-seven years later, it still hasn't enacted any legislation to curb abuses in this
arena, although this year, several medical-privacy bills again await consideration.
Capitol Hill lawmakers have been amply rewarded for rejecting efforts to apply greater
privacy protections to health-care records. Since 1987, hospitals, insurance companies,
and members of trade associations that oppose such protections have poured more than $45.6
million into congressional campaigns.
Anti-privacy interests have little trouble finding Members of Congress to do their
bidding. In 1995, Representative David Hobson, a Republican from Ohio, tacked an
industry-written proposal for the exchange of computerized medical records onto
legislation aimed at overhauling Medicare and Medicaid. Thomas Gilligan, the chief
lobbyist for the Association for Electronic Health Care Transactions, told a trade
publication at the time: "I'm flabbergasted and impressed. I think Hobson has done
the industry a service." Since 1987, Hobson has collected more than $65,000 from the
anti-privacy lobby.
When Congress passed the Health Insurance Portability and Accountability Act of 1996,
popularly known as the Kennedy-Kassebaum bill, it stipulated that the Health and Human
Services Department would write the law's privacy-protecting regulations. Soon afterward,
the Association for Electronic Health Care Transactions swung into action. "The
latitude the original provision gave to HHS was just unlimited," Thomas Gilligan, the
lobbyist I just mentioned, told the Center. He went on to say, "In the end, that
provision was deleted and the other one put in." The "other" provision
relegates HHS to an advisory role and calls a friendlier force -- Congress -- to write the
rules.
So what, exactly, has Congress done on the privacy front in recent years? In 1991 and
1993, at the behest of various corporate interests, Congress killed legislation that would
have regulated the clandestine videotaping and wiretapping of workers on their jobs. In
1996, after lobbying by the direct-marketing industry, it killed a bill that would have
restricted companies' gathering of information about children without their parents'
consent. That same year, it killed legislation that would have restricted insurance
companies from releasing to others information about policyholders' claims, and it killed
another bill that would have barred Internet-service providers and on-line services from
releasing or selling information about customers without their permission. In 1997,
lawmakers introduced bills to regulate the use of citizens' Social Security numbers for
identification, a practice that makes it easier for thieves to obtain them and commit
frauds, and to curtail the U.S. Postal Service's practice of selling patrons' names and
addresses to direct-marketing firms; so far, none of those proposals has made it out of
committee.You can bet that they will go where other privacy-protecting legislation has
gone: nowhere.
Worst of all, Congress has turned some legislation into Trojan Horses for corporate
privacy invaders. In 1986, for example, Congress passed something called the Electronic
Communications Privacy Act, but it's this law that allows companies to eavesdrop on -- and
tape-record -- telephone conversations made "in the ordinary course of
business." So these days, when you hear that telltale "This call may be
recorded" tag at the other end of the line, you have Congress to thank.
In 1996, Congress passed the Consumer Credit Reporting Act, which compelled credit
agencies to take quicker action to correct erroneous information on credit reports and
required subjects' permission before bureaus could furnish credit reports to employers.
But the same law also allowed credit bureaus to continue selling sensitive information
from an individual's credit file -- the "credit header" containing one's Social
Security number, mother's maiden name, phone number and recent addresses, and other key
identifying information -- to anyone who wants it, even if the requester's purpose has
nothing to do with the granting of credit. That information can now be easily purchased
over the Internet, not just by businesses but by abusive husbands who want to track down
their fleeing spouses or by criminals who want to take over consumers' identities to
commit credit-card fraud.
On occasion, Congress has taken decisive action to protect privacy -- its own. Back in
1982, Irwin Arieff, then a reporter for Congressional Quarterly, filed a Freedom of
Information Act request seeking simply the names and amounts of prescription drugs
supplied by the National Naval Medical Center to the Office of Attending Physician of
Congress. Senator Howard Baker, a Republican from Tennessee, responded angrily on the
Senate floor. "The disclosure which is sought remains an intolerable invasion of
personal privacy," Baker said, even though Arieff had sought information on the
drugs, not identification of the lawmakers to whom they had been prescribed. Baker went on
to say, "[T]he interest of patients in the absolute confidentiality of medical
information is paramount." What he didn't mention was that "absolute
confidentiality" applied only to patients who happened to be Members of Congress;
lawmakers had rejected a 1980 bill that would have applied such privacy protections to the
health-care records of ordinary citizens. And so it has gone for nearly twenty years.
Now, as Congress debates major health-care legislation, we have come full circle. Will
Members of Congress do the right thing and place the same value on our privacy as they do
on their own? History doesn't give us much reason for optimism.
For once, however, is it too much to ask Congress to help preserve, protect, and defend
what little privacy we have left?
Thank you. Before taking your questions, I would like to thank the individuals who
produced this report: the director of investigative projects, Bill Hogan; the senior
editor, Bill O'Sullivan; the chief of research, Bill Allison; the writers, Patrick J.
Kiger, Paul Cuadros, and Jeff Shear; the senior researchers, David Engel, Adrianne Hari,
and Eric Wilson; and Center researchers, Lloyd Brown, Justin Buchler, Megan Chernly,
Russell Eckenrod, Nicole Gill, and Melanie Strong.
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