How Elizabeth Warren's Privacy Rules Will Fight the Corporate Snoops
Continued from previous page
This imbalance of power allows banks and other corporations to keep acting unjustly. That needs to change.
4. It reduces the ongoing encroachment of Big Data on our daily lives.
The computer crowd likes to say that "Information wants to be free." We've learned now that it actually wants to be very, very expensive - and it's not interested in whether you remain free. Big Data is a self-sustaining and self-expanding institution which seeks to maximize profits by finding new markets for the information it gathers.
The credit score industry is an excellent case in point. FICO and its competitors began gathering credit information for lending institutions. Once they created systems for collecting the data, their only remaining challenge was a sales challenge: who else will buy it?
That's how Big Data becomes big.
The employer market is enormous. Even in recessionary times like these, hundreds of thousands of hiring decisions are being made. Each involves multiple candidates. Cracking this market was a major "score" for the credit score industry. And if the social and human costs of entering this new market were enormous - well, that's not their problem, is it?
It may not be their problem. But it's ours. And in solving it, we can also send a signal to the corporate world and the body politic: Big Data doesn't run things - people do.
5. This credit information isn't even useful.
Our infatuation with Big Data can also lead us to ascribe more wisdom to it than it actually possesses. This is a perfect example of that phenomenon in action. The only academic research we could find on the topic, published in the Psychologist-Manager Journal in 2012, concluded that "Predictors extracted from applicant credit reports ... had no relationship with either performance appraisal ratings or termination decisions."
Not a "weak" relationship. Not an "unproven" relationship. No relationship.
This practice creates needless misery. This bill will stop it.
6. It reaffirms our values as a society.
If credit information doesn't predict employee performance, why use it at all? Whether consciously or not, its only purpose becomes cultural, not economic. It becomes a way for people who have jobs to avoid those who don't. It's a way of stigmatizing the unemployed, as if they are carriers of a terrible contagion.
We're often tempted to look away when we see the hungry or the sick on the street. This practice does something similar, by keeping the bearers of bad luck away before it rubs off on us, too.
But that's just superstition, and it's not who we are. At our best, we're a society whose citizens help one another in times of need. We're a society that believes in equal opportunity. We're a society that believes in the right to privacy. And we're a society that believes people who want to work should be able to work.
Sen. Warren deserves credit for introducing this bill. So do her Senate co-sponsors: Senators Richard Blumenthal (D-Conn.), Sherrod Brown (D-Ohio), Patrick Leahy (D-Vt.), Edward J. Markey (D-Mass.), Jeanne Shaheen (D-N.H.), and Sheldon Whitehouse (D-R.I.). And so does Rep. Steve Cohen (TN-9), who introduced a similar bill in the House in 2011.
The people who are being hurt by these credit checks want to improve their own lives. It's time to let them. We'll be improving our own lives too.