It is a perilous path when companies and governments decide that the law does not matter and the corporation is merely an agent of the state for however it may wish to monitor customers.
Yesterday, it was reported that the customer records of more than 3.4 million Canadians were stolen in mid-January. It took four weeks before the theft was revealed to Bell Canada’s customers. And while the information was eventually recovered, no explanation has been provided as to what shortcomings existed in its system that would have permitted such a huge breach of privacy. It is hard to imagine that these records were adequately protected if they could be stolen on such a scale. And their theft raises serious questions about how well more sensitive data, including the banking records of customers, is protected. The delay in bringing the breach to the public’s attention shows again that there is need for legislation that would force companies to advise customers immediately when a theft of their information occurs –not weeks after the fact.
Once again, we note that Canada’s Privacy Commissioner is noticeably absent from this file. Twenty-four hours after the theft was made public, the Commissioner’s website hasn’t even acknowledged the incident, much less indicated that it has commenced an investigation. Speed is not a function typically associated with this office. There still has been no explanation of the result of any investigation in connection with the disappearance in 2006 of the personal financial information of 470,000 CIBC customers, which we wrote about here.
In the United States, a breach of a different kind occurred yesterday, when the Senate voted to give giant telecoms immunity from lawsuits as a result of their assisting authorities in the warrantless wiretapping of calls made by their customers to overseas destinations. The telecoms, including giant AT&T, lobbied the Bush Administration and Congress for the bill, and they were more than happy to oblige. For its part, business expects that customers will play by the rules. Legions of lawyers are employed to ensure that they do. It is not unreasonable, it seems to us, that customers are entitled to expect that business will also play by the rules as they exist at the time, and when its does not, whether in privacy matters or wiretapping, consequences should follow.
Retroactive legislation seldom makes for good law or sound public policy. It is a perilous path when companies and governments decide that the law does not matter and that the corporation is merely an agent of the state for however it may wish to monitor customers. Yahoo’s CEO was recently castigated by the House Foreign Affairs Committee for that company’s role in turning over customer emails to security officials of the government of China. In the 1930s, major players in the German business sector eager to be seen as cooperating with the new Hitler Reich during its infamous Gleichschaltung period, volunteered to turn over personal information about their Jewish customers and employees. They argued it was in the national interest to do so.
Fighting terror is a necessary cause in the preservation of liberty and civilization. But in that fight, the distinction between the values of the terrorists and the values of their democratic targets must never be lost. Islamic extremists do not value individual rights, personal freedom or privacy. These are the hallmarks of western democracies. And when elected governments begin to erode these rights in the so-called defence of democracy, they place both in jeopardy.
Telecoms routinely boast about their commitments to protecting customer privacy. But these events show that individuals can depend little on such claims and even less upon the public officials and policy makers who are supposed to be on the frontline of ensuring that protection.
How much further will it go to appease the non-democratic holders of oil wealth or American debt? After its major banks and corporations have succumbed to the influence that multi-billion dollar investment stakes invariably enjoy, will American foreign policy someday become a commodity to be bought and sold like offshore-made pieces of patio furniture at a local Wal-Mart?
There have been many voices at the World Economic Forum this week. There were the voices for combating climate change and the fight against poverty in Africa. There was the voice of Bill Gates, who, judging by media reaction and the response at Davos, single-handedly invented the concept of responsible capitalism. All these are worthy objectives. But one voice seemed notably muted: the voice for democracy. (more…)
We’re taking a few days off to celebrate with our American friends and family. Finlay ON Governance has a remarkably diverse readership from literally every part of the globe. So whether you’re in Australia or Spain or Japan or the Netherlands, it would be nice to think that you, too, will take a moment to share in a bit of thanks –remembering that there is much to be grateful for, just as there is much worth standing up to preserve.
The photo on the left, by the way, is of the original proclamation, issued by President George Washington on October 3, 1789, denoting a day of Thanksgiving to observe “…the civil and religious liberty with which we are blessed.” I have passed by the building near Wall Street where he signed it on many occasions and still get a thrill each time.
To paraphrase Wordsworth, Washington! Thou shouldst be living at this hour: America hath need of thee.
All the best, wherever you may be.
J. Richard Finlay
In 1917, the best a generation had to offer fought bravely to defend freedom and the ideal of a civilized society. In 2007, another generation serves that cause in a far off land. Time and again we have called upon young heroes who are willing to make the ultimate sacrifice for others. Time and again they answer that call. We are not always as fortunate in our choice of leaders who possess the vision and ability to avoid situations where such sacrifices become necessary.
We salute, as always, those who have served and fallen and those who serve today. But we think we honor them best by being true to the principles of freedom and democracy which require vigilance on the part of citizens as to whom they permit to lead them and the kind of qualities they ensure are brought to that great trust.
If an elderly woman is still doing her part to make the system work by exercising the duties of citizenship, if young people can fight and die for freedom in a distant war torn land, the fact that millions in Ontario can’t be bothered to cast a ballot is an unmitigated disgrace.
I was back in Toronto this week and had the privilege of escorting my nearly 86-year-old mother to our family’s traditional annual Thanksgiving dinner at the Four Seasons Hotel, where we literally bumped into former prime minister Brian Mulroney and his ever radiant wife Mila, with whom we shared an elevator. Unlike the United States, where the secret service would have shut down the lobby for the coming and going of an ex-president, Canada provides no close protection for its heads of government once they leave office. (more…)
As we have been suggesting for a while now, the biggest and most damaging impact from China has not been the poisoned dog food or the counterfeit toothpaste, nor is it even the lead in children’s toys or the SARS epidemic which originated in China and almost shut down parts of Canada. Serious and unsettling as these have been, they pale in comparison to China’s apparent power to induce North American consumers to fall into a state of obliviousness and sleep walk into disaster in their pursuit of cheap products.
It seems many have forgotten that they are really dealing with and enriching a regime that is fundamentally corrupt, as any dictatorship which lacks principles of transparency and accountability fundamentally is. The West was too quick to grant China most favored nation status some years ago. It did so without thinking about the consequences —about the lost jobs at home, the appalling working and sanitary conditions in China or about making a communist totalitarian system one of the major creditors of the United States. We are beginning to see some of those consequences, just as we are the spectacle of what some companies will do in placing profits ahead of prudence.
As we have remarked before, the real concern is that this is just the tip of the iceberg and that a number of other shocks lie ahead —not just involving product safety but other ways in which the China contagion of corruption and deceit, along with its mounting wealth, has afflicted our society, our economy and our institutions.
It has long been said that there is no free lunch. If that is the case, perhaps we have all paid a much higher price than anticipated for the products we thought China was producing at bargain basement prices. What we observed a few months ago seems particularly fitting at this time of summer holidays and daily horrors in the marketplace.
None of us can afford to take a vacation from the stakeholder responsibilities we all have as citizens, consumers and investors, and when we do, the results can be chilling.
