Why privacy, why now? There seem to be three factors. Consumers who are fed up with aggressive intrusions on their private lives. Institutions like those in Minnesota and New York, who were caught crossing the line. And members of Congress who are not only shining spotlight on privacy, but also working to ensure that consumers are told about how and why personal information is collected and used, provided access to that data, and given a choice in the matter.

There is some comfort in knowing that there is so much interest about protecting the privacy of American consumers. Whether that comfort is a warm blanket or wet blanket depends whether the Administration, Congress, regulators, and those in the states turn up the heat. It also depends on the willingness of American industry to come in from the cold and adopt Fair Information Practices. Later today, the push for privacy continues at a Congressional Privacy Caucus briefing with the New York and Minnesota Attorneys General.

Do consumers care? You bet they do. According to a Forrester Research survey of online users, 67 percent said they were "extremely" or "very" concerned about releasing personal information over the Internet. It is estimated that those fears may have resulted in as much as $2.8 billion in lost sales for Internet retailers in 1999. The lack of privacy is costing business.

A new Business Week/Harris poll shows that 92% of Internet users are uncomfortable about Web sites sharing personal information. 57% favor the government passing laws on how personal information is collected and used. And many people are uncomfortable with the creation of profiles. 82% said they were not comfortable with linking their identity with personal information like income, credit data, and medical information.

The ability to collect, share and use data in all sorts of ways boggles the mind. Consumers, in many cases, aren't even aware that data is being collected, much less how profiles about them are created. The information collection overload is particularly troublesome when it becomes the basis for decisions made about an individual -- like how much a product or service will cost.

What protections do consumers have today? Not much. The much ballyhooed privacy provision of the Gramm Leach Bliley Act does not protect consumers' privacy. And because the underlying bill is bad, the implementation of regulations provides little hope for consumers seeking to keep their personal information private. While states were given the ability to enact stronger protections, those efforts have met fierce resistance by the financial services industry.

We need stronger laws, like the one introduced by Senators Shelby and Bryan, and Congressmen Markey and Barton. That bill will put power and choice in the hands of consumers regarding the collection and use of their personal information.

Web-based businesses already seem to be willing to move beyond the privacy wasteland where GLB left consumers. There no longer appears to be a question, for some, of whether consumers should get notice, access, and control over their information. The challenge is how to effectively put these principles into practice.

What about privacy policies? Won't those do the trick? Privacy policies are not a substitute for privacy protections, especially when some companies don't even follow what is in their policies. Just because a company has a privacy policy does not mean that they follow Fair Information Practices. And consumers are skeptical about self-regulation. Only 15% of those surveyed in the Business Week poll supported letting groups develop voluntary privacy standards. Nor has industry shown the will power to adopt adequate self-regulatory programs.

Where is all this going? The marketplace is changing daily. The Wall Street Journal reports that Time Warner has the names, addresses and information on the reading and listening habits of 65 million households. USA Today says Time Warner has access to information about its 13 million cable subscribers and from its other businesses, like Time and People magazine. With so much information, how will the competitiveness of the marketplace be impacted by this merger? Will companies who seek to operate under a higher privacy standard be at a competitive disadvantage and unable to compete against a larger entity that is able to make unrestricted use of the personal information it obtains? Is this the future? Now imagine a Time Warner/AOL/Bank of X.

Today, business models are based on collecting and selling information. Financial institutions want to get into the business too. In a recent speech, Julie Williams, Counsel to the Comptroller of the Currency, said that consumers may become "more reliant on bank-maintained databases . ...consumers may conclude that banks are a logical repository of all their information: financial and non-financial." At about the same time, the Financial Services Roundtable was asking the Federal Reserve for expanded powers to get into the data processing business.

Will consumers benefit from all this data sharing? Financial institutions promised that in exchange for a virtually unfettered ability to collect and share consumers' personal information, that consumers would get better quality products and services and lower prices. This is why, they claimed, consumers shouldn't have strong privacy protections like the ability to stop the sharing of their information among affiliates, or access to that information to make sure its accurate. Final answer? Let's look at reality.

Bank fees for many consumers continue to rise. Information about financial health may actually be used to the consumer's determent if it is perceived that the consumer will not be as profitable as other customers. Both Freddie Mac and Fannie Mae say between 30 and 50% of consumers who get subprime loans, actually qualify for more conventional products, despite all the information that is available to lenders today. Credit card issuers continue to issue credit cards to imposters, thus perpetuating identity theft, even when it seems like a simple verification of the victim's last known address should be a warning. Instead of offering affordable loans, banks are partnering with payday lenders. And when do some lenders choose not to share information? When sharing that information will benefit the consumer -- like good credit histories that would likely mean less costly loans.

Maybe the right approach is to let institutions that want a consumer's information to be put in a position to convince that consumer that some benefit will be derived from a willingness to give that information up to the institution. Such an approach may increase trust in financial institutions and let consumers have control and choice over their own personal information. The same technology that enables vast amounts of data to be collected can be used to give consumers access to that data. It is a simple thing to tell consumers what is collected and how it is used.