The Internet: Data Privacy and Innovation

Charles H. Rivkin
Assistant Secretary, Bureau of Economic and Business Affairs
Japan National Press Club
Tokyo, Japan
April 6, 2015

Thank you for the kind introduction and good afternoon everyone. I’m honored to be here in Tokyo on my first official trip as Assistant Secretary of State. I’m also pleased to speak about “The Internet: Data Privacy and Innovation” as this subject couldn’t be more timely or appropriate. The stakes are enormous: nothing less than the continuing viability of the global digital economy and its powerful potential to fuel economic and social development for everyone on this planet.

I don’t normally begin speeches talking about children’s stories. But there is one whose central metaphor is so powerful, that it has been retold for centuries in cultures around the world.

This story can be found in Aesop’s Fables, the writings of Jean de la Fontaine, the Buddhist book of Vinaya, Greek myths, India’s Mahabharata, and even a panel on an eighth century mural in Tajikistan.

In English, we refer to the story as The Goose that Laid the Golden Eggs. In other versions, that goose is a swan, a hen or a wild bird. But in all stories, a feathered animal produces gold, either in its eggs or its feathers. In their short sighted actions, the owners of this bird ultimately kill the source of their profitability.

I share this story with you as a timely and cautionary tale. The Internet is the modern equivalent of that gold-producing goose. With its connections come data and economic activity that make it an indispensable tool in almost every human endeavor.

We see this in everything from the flow of business and commerce to e-government, from the pursuit of scientific breakthroughs to our need to communicate or simply be entertained.

Its potential to achieve even more is ours to realize or squander.

As enduring partners and co-stewards along with other stakeholders of the global digital economy, America and Japan recognize those stakes.

We share the conviction that the Internet must remain free, open and vibrant, and we continue to promote and support the decentralized, multi-stakeholder approach to Internet governance. We believe this will drive innovation, create economic growth, and help to bring more people into the digital economy.

Central to achieving these and other outcomes is the reduction, and ultimately the elimination of friction from the transfer of ideas and information.

Without the free flow of data, the Internet could become a fractured network that would undercut the very vibrancy, innovation and multi-directional flow of goods, services and ideas that power the digital economy.

But as we work to reduce frictions and preserve our digital fluidity, we must also address some profoundly challenging questions.

How, for example, do we reconcile the internationally recognized right to privacy with the conviction that we also have the right –and certainly any number of compelling needs – to access information and knowledge, via the internet or any other mechanism?

How do we keep the flow and vibrancy of information over open networks, but also protect ourselves from data breaches and from becoming cyber targets?

These and related questions couldn’t be more timely, especially as the Japanese Diet considers revisions to its own personal data protection legislation.

The challenge is the same: how to protect individuals and to promote new and innovative uses of personal data. Both values are important and we strongly believe, balancing them is not only possible but imperative.

We in the United States do not claim to have all the answers but we continue to work towards finding a seamless balance between supporting the flow of commerce and human interaction that is at the heart of the internet and protecting the privacy of citizens.

We know that if we overcompensate too much in one direction, it can be at the cost of the other. That is why we support non-binding international instruments that embrace basic, technology-neutral principles. They should reduce the friction between nations, and they should emphasize accountability, regardless of where the data is housed geographically.

When it comes to protecting data, we believe that no consumer should be vulnerable to unfair or deceptive practices. They should also have a right to expect companies to treat their information and them with respect.

We also believe that while government has the responsibility to enforce those standards, we should and can work with industry to make those principles work in practice.

The reality is that all of us are now “present” in multiple countries every time we go online, and privacy has to be protected in a manner appropriate to our global and interconnected environment. We can’t pretend that we will be able to wall off our personal data and keep it safe in a fortress.

That’s why we believe working with innovators to protect people as well as preserving their ability to access cutting edge services is better than creating walls to either protect people from themselves or presume that industry is out to harm people.

We believe that corporations have a strong self interest in working with us to create and apply best practices for privacy protection. After all, they depend on privacy of their records and protection of their consumer information for the survival of their businesses.

In the United States, we have specific laws in the financial, health and other sectors, to protect privacy. We also have general laws that protect consumers regardless of the technology used.

But in some cases, there are industry standards that our government enforces with great commitment using its authority over fair trade practices. All this is done in the context of a free and open environment for innovation. We feel that this is the best possible balance for us.

We encourage ideas and debate. We recognize that the privacy legislation we have recently proposed in the U.S. Congress has a potentially global impact across a wide range of economic sectors.

We invite global input on the President’s new discussion draft for a Consumer Privacy Bill of Rights from all stakeholders, public and private alike.

We also welcome Japan’s contributions to the conversation, particularly in light of the proposed revisions to Japan’s Personal Information Protection Act.

In these and many other related matters, we always draw great comfort and satisfaction in Japan’s leadership and our work together, whether in multilateral forums, trade negotiations, or in our annual bilateral conversations.

Last year, for example, our two governments partnered at the International Telecommunication Union’s Plenipotentiary treaty conference to preserve and promote the Internet’s existing system of voluntary protocols and multistakeholder-led governance.

We prevailed against other nations who wanted to centralize control over the Internet in the hands of governments at the ITU.

We have also worked together at venues such as the NETMundial conference and the Internet Governance Forum to support greater participation of the developing world in the multistakeholder system.

In the data privacy space, we have worked well together in The Asia Pacific Economic Cooperation, or APEC, where we strongly supported the Cross Border Privacy Rules that hold multinational corporations accountable for their privacy practices.

We also stood shoulder to shoulder at the OECD, whose guidelines specifically address the Protection of Privacy and Transborder Flows of Personal Data.

Our conversations as bilateral partners remain useful and productive, stemming from the trust and frankness that our friendship allows.

We have shared concerns about emerging problems like data breaches, which in both the United States and Japan have heightened public awareness and concern about the digital economy, and which can threaten consumer confidence in electronic commerce unless we address the problem.

We continue to work together by respecting each other’s frameworks for managing the related challenges, as we seek ways to preserve the viability of the Internet, and the economies of scale it creates as an engine for economic and social development worldwide.

Our eyes are focused firmly on the end goal: an enlightened policy that protects individuals, but doesn’t also harm the Internet’s extraordinary power to improve, leverage, streamline, enrich, deepen and elevate peoples’ lives.

By promoting and supporting connectivity, with as little friction as possible, we will be well positioned not only to keep the Internet viable but to develop and make it available to every community on Earth.

Right now, three billion people are connected to the Internet. But more than half the world’s population is not, for various reasons ranging from political tyranny to lack of connectivity.

We have the potential to build a greater digital community from the remotest corners of our world to the busiest urban centers. This means many more human aspirations realized. It means greater markets, consumer choices and healthcare accessibility; more efficient supply chains; and ultimately a more innovative, productive, safer, and happier planet.

A generation ago, we might have dismissed those goals as over ambitious. In the digital age, they are eminently possible.

In closing, I am reminded of a quotation attributed to one of America’s founding fathers, Benjamin Franklin, who was one of the chief architects of our national Constitution, and America’s first diplomat.

Towards the closing stages, when the Constitution was all but ready, someone asked him: “Well Doctor Franklin, what have we got – a republic or a monarchy?”

To which Franklin replied: “A republic – if you can keep it.”

In this digital age, we have to make sure we keep and preserve what are most important to us: not only the freedom and flow that are necessary to the Internet but protection of the people who use it.

This is a difficult balance to achieve, but I know we have the means, the resources, and the will to arrive at the right decisions.

Thank you.