How capitalism evolved to drop its defence of privacy

Historically, privacy was a luxury for the wealthy, who could afford private spaces and crafted distinct social personas. As society’s economic well-being improved, privacy became a societal expectation. Today, however, the rise of data-driven businesses threatens this privacy. Since privacy is rooted in capitalist interests, its preservation now conflicts with the commercial benefits of exploiting personal data. To protect privacy, we must establish commercial disincentives that outweigh the financial benefits of exploiting personal data.

This article was first published in The Mint. You can read the original at this link.

For most of human history, we have lived cheek-by-jowl with each other in crowded tenements where the sheer physical proximity of our living arrangements made it impossible for anyone to hold back secrets from their neighbours. Under these circumstances, not only was there no expectation of privacy, the very notion of personal space was an alien concept.

That said, our privacy has always been dependent on our ability to control how much the world knows about us. This, in turn, has always been a function of how wealthy we are. Even when our houses were crammed together so tightly that everyone knew exactly what their neighbours were saying, those who were rich enough to afford it built large homes set sufficiently away from those around them so that they could not be overheard or spied upon.

This upper echelon of society was the first to realize the benefits of having private space. It gave the elite an ability to develop distinct social personas—one that they could put on when they were out and about in public, and another that cleaved more closely to their true personality, which only came out when they let their hair down in the privacy of their homes. This ability to craft a public identity distinct from their private one gave the wealthy an undeniable social advantage. It allowed them to be whatever society needed them to be and gave them the ability to do so without being caught out. It was also a privilege worth fighting to preserve—and fight they did.

They built high walls to shield their dwelling units from public gaze and enacted laws to protect themselves where physical structures would not suffice. They created clubs, associations and fraternities that offered sanctuary to their members, allowing them to interact within their environs, secure in the knowledge that what they did would never be made public. They used their wealth to reinforce the notion of personal privacy, establishing entry barriers based on pedigree, title and net worth that made it difficult for anyone they deemed unworthy to gain access to these secluded areas.

It was not until the economic well-being of society as a whole improved that this dynamic began to change. When that happened, privacy stopped being the exclusive preserve of the upper crust. People from all levels of society came to appreciate the benefits of being shielded from the prying gaze of their neighbours and being able to speak freely without having their words overheard and held against them. All these people came to enjoy the notion of privacy, and as more and more people began to experience for themselves how this felt, the right to personal privacy became a societal expectation.

Today, it feels as if our privacy is under attack like never before. Governments and private corporations alike seem to be able to learn whatever they want to about us from the data they collect in the course of our interactions. The sophisticated algorithms they run are able to infer more about who we are than we can. It feels like the walls we built to protect our personal space are slowly but surely being torn down by digital businesses that know more about us than we do ourselves.

Every business, no matter how big or small, understands the value of data today. Firms recognize the benefits that can be gained from leveraging personal data and are eager to exploit it in order to provide various innovative services that their increasingly mobile customers have begun to demand. If they did not initially understand the impact that this pivot towards data would have on the personal privacy of their customers, given the heightened sensitivity to issues relating to privacy, they are now alive to its many consequences. Why then do they still look to develop newer and more complex data-driven businesses despite the privacy risks posed by it?

In order to understand why this is happening, we need to examine these developments in the context of the economic foundations on which our modern notion of personal privacy is based. Since privacy is fundamentally a capitalist construct, its continued existence as a right worth fighting for depends on the forces of wealth control remaining aligned in favour of ensuring its preservation. So long as it is in our economic interests to continue to protect privacy, we will do so, but the moment that changes, any expectation that we might currently have of being able to continue to exercise our right to privacy comes under threat.

In the past, wealth was used to preserve personal privacy. Today, it is impossible to remain profitable if your business does not do what is needed to incorporate data into the core of your offering. If you do not embrace this new reality, your competitors will, regardless of the privacy consequences of doing so. It is rapidly becoming clear that capitalist interests are no longer aligned with protecting personal privacy. To the contrary, it is in the commercial interests of modern businesses to wring as much out of the personal data of their customers as is commercially feasible.

It is precisely because of the capitalist origins of our notion of privacy that there is such an indifference towards privacy concerns. If we think there is a benefit to preserving personal privacy and want to encourage behaviour that preserves privacy, we will need to find commercial disincentives that outweigh the financial benefits.