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University of South Dakota School of Law

Tuesday, September 16, 2014

Ben-Shahar & Schneider Symposium, Part III: Ryan Calo, Disclosure Is Dead, Long Live Disclosure!

This is the third in a series of posts that are part of a virtual symposium on the new book by Omri Ben-Shahar and Carl E. SchneiderMore Than You Wanted to Know: The Failure of Mandated Disclosure Biographies for the first week's contributors can be found here.  The authors' introduction to the symposium can be found here.

CaloRyanRyan Calo is an assistant professor of law at the University of Washington, where he co-directs the Tech Policy Lab, and an affiliate scholar at the Stanford Center for Internet and Society. 

Disclosure Is Dead, Long Live Disclosure!

Omri Ben-Shahar and Carl Schneider are careful, meticulous, and forceful in their critique of mandatory disclosure as a regulatory mechanism. And they are in a basic sense right. Mandatory disclosure really does operate as this “Lorelei, luring lawmakers on to the rocks of regulatory failure” (4). I thoroughly recommend their rich new book, even if one has already read the law review article from which it sprung, The Failure of Mandated Disclosure, 159 U. of Penn. L. Rev. 647 (2011)

What Ben-Shahar and Schneider are not, however, is dreamers. They take rigorous aim at mandatory disclosure in its present form, without really imagining how that form stands to evolve. 

More Than You Wanted to Know decimates mandatory disclosure by walking through its long history of failure. Everything the book says about notice is true. But now imagine for a moment a critique of hospitals from the 19th century with a similar structure—call it Worse Than the Cure: The Failure of American Hospitals. Here is the argument: Societies have used hospitals to sequester the sick for millennia. But the sick themselves continue to fare very poorly. We have tried to professionalize the staff; we have looked to specialization and statistics. Nothing works. Hospitals are places that the sick go to die, period.

How strange that feels. Where did our imaginary authors go wrong? Well, as late as the middle of the 1800s, medical professionals did not understand the role of hygiene in propagating disease. It took doctors like Oliver Wendell Holmes—father to the Supreme Court Justice—and the famed Florence Nightingale to popularize the idea that medical professionals wash their hands to prevent the spread of germs. Hospitals still face challenges around germs—staph infection, for instance. But of course modern hygiene practices revolutionized healthcare for the Industrial Age.

Morethan Today we live in a gee-whiz-bang world of information, an Information Age. And yet, when it comes to mandatory disclosure, we are using Guttenberg-era technology. The law expects plain, block text akin to how the Bible was printed in the 16th century. What innovation there is occurs at the margins. Ben-Shahar and Schneider discuss nutrition labels, icons, and light personalization as examples of notice innovation (121-37). These alternatives fail, or succeed only marginally; they, too, rely on conveying static information in words or its symbolic equivalent. 

What if critics of disclosure today are like the 19th century critics of hospitals? What if we are on the cusp of a revolution in the way governments and firms communicate with citizens and consumers? How would we know? Companies like Twitter and Google render navigable an endless sea of information, and yet they write privacy policies and terms of service in block text because that is what the law expects. Were its techniques to catch up to, say, Facebook’s Newsfeed, who can say what disclosure could be capable of?

I canvass the prospect of law dragging disclosure into the 21st century at length in my article Against Notice Skepticism in Privacy (and Elsewhere), 87 Notre Dame L. Rev. 1027 (2013). Why bother to revolutionize disclosure, though? Why risk another shipwreck? Well, there is a reason that lawmakers keep picking notice as a regulatory mechanism, and that is the paucity of alternatives. Caveat emptor. Command-and-control. There are real tradeoffs to regulating through elaborate rules. We might say of mandatory disclosure what Winston Churchill once said of democracy: notice is the worst form of regulation, except for all of the alternatives.

I read Ben-Shahar and Schneider to implicitly acknowledge this point. They conclude the book (185)—and especially the law review article—with a call for less disclosure and more “advice”:

Advice is (usually) not just simpler and shorter than disclosure—if offers a different kind of help. Successful advice does not teach fundamentals or facts. It answers the real question: how likely are you to be satisfied?

The distinction between disclosure and advice is, to my mind, thinner than the authors make out. I am reminded of the distinction Ed Rubin draws between “theoretical” and “practical” knowledge: like advice, practical knowledge takes information and applies it specifically to the consumer’s particular situation. Sometimes it takes a simple warning to keep the kids off of the electric fence; other times a much more elaborate education is needed to create in the citizen or consumer and accurate mental model of risk.

Could the government mandate advice? Maybe. Could firms automate advice with technology? Increasingly, yes. Advances in artificial intelligence such as IBM’s Watson suggest that, at least within the confines of specific domains like healthcare, software can meaningfully assist professionals and consumers alike in making difficult decisions. If IBM’s system can beat people at Jeopardy and diagnose cancer, maybe it can walk you through term versus universal life insurance.

Who knows? I could be just another note in the long song of the Lorelei. I deeply admire this important work by Ben-Shahar and Schneider and will refer to it again and again. 

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