The privacy angle is minuscule compared to the human costs of not having consumer debt.
> The privacy angle is minuscule
It is infuriating to see the suffering of the individual victims of identity theft dismissed so cavalierly. If the credit reporting companies had to pay for all the harm they cause they would be bankrupt many times over.
Even if credit rating serves a purpose, how does the system get reformed to bring true redress to those negatively affected by it?
Having grown up in a credit-averse and cash-focused society, I don't think they're that necessary. What people do instead in build a relationship with your local bank. Of course, once you're used to a credit-driven society it's hard/impossible to go back. People apparently hate being told "No you can't afford that new car".
In my twenties when I left the military I lost the ability to pay back my debts. It took me some 9 years to decide to clean up my credit. Living without a credit score is absolutely possible right now.
- Credit existed before reporting agencies
- It's possible to verify creditworthiness without a reporting agency
- Reporting agencies aren't particularly good at their job anyways
You may dislike the first two arguments, because obviously they make debt more expensive. I don't think that's the worst thing in the world. So, I'll focus on the last point.
Credit reporting agencies often have incorrect info. Here's an FTC study that says one in five have wrong info that was corrected. [0]
You may argue that I should use the other number, ie. people who still had errors after fixing it: 2.2%. But, it oftentimes by the time you fix an error, the opportunity to get the thing you want (ie. job, apartment, car, house, etc) has passed.
But even if the data was correct, the way they generate the score manipulates people into taking on more debt than they should and take on worse debt.
Getting and using one or more credit cards is the easiest ways to improve your credit score, and this is honestly bullshit. Credit cards encourage bad spending habits and trap people in debt. The credit card companies rely on people carrying a balance and a really good way to make that happen is to make sure everyone uses their credit cards for everything.
Meanwhile, things that should improve your score often don't. For example, rent and utility payments only count if they are reported and a lot of landlords or companies don't report or only report if you don't pay.
Maybe it's not the credit reporting agencies' problem if people don't report good behavior. And, I don't know what efforts they've made at getting more people to report. But my bias tells me that they probably just don't care.
[0] https://www.ftc.gov/news-events/press-releases/2015/01/ftc-i...
>- It's possible to verify creditworthiness without a reporting agency
Absolutely, it was called "whether the banker knows you from church as a good Christian man".
That said, I'm not sure a world without consumer debt would be that much worse.
Equifax market cap is currently $13.5B. Corporate death penalty would hurt owners of that stock, maybe funds in your own 401K account. Thousands of people would lose their jobs.
Would it have a preventive effect? Maybe but doubtful. There are too many systems with too much data that are too old and too interconnected to think that it's even possible to secure them all. If it wasn't Equifax it would have been someone else, eventually. Most of what Equifax exposed was probably already exposed in other leaks anyway.
Better solution should be developing new, secure methods of proving identity, where leaks don't matter because it's not possible to leak anything of value. All the old ways are now forever broken.
That they've managed to schmear consequences of that explosion across society is a pretty circular reason for not damaging them.
How does that get us any farther with the fundamental problem of how to prove identity when all the old schemes have been rendered useless?
There's a revenge or punishment piece that maybe is necessary and appropriate, but it doesn't solve any of the real problems we now face.
And just because it's too late now doesn't mean the law can't be adjusted to prevent it from happening in the future. If you don't learn from mistakes, that's dumb. And obviously companies can't be trusted to do it themselves.
If the consequences of losing our data was high enough, more money would be spent protecting the data. Which I think is one of the good things for GDPR, it has stiff penalties and one of the considerations for the fine is negligence.
Equifax is probably going to end up making more money now because of the breach as more people now need "better" identity verification - a service that Equifax conveniently provides.
When are we as a society going to say enough is enough and take power back from these evil entities?
[Yes, I do consider them to be evil]
Capital punishment is meant as a deterrent, not a preventative measure (well, really, it's revenge for the mob) and so it could potentially work much better with corporations than with individuals.
Data breaches are only preventable when you have an inhumanly good security team. This is mot even possible for your average non-technically-inclined business leader.
Why don’t I have any say in all my financial transactions and “passwords” being sent to and vacuumed up by tech ologically incompetent, undeniably unethical bureau-corps?
It’s what I found so refreshing about Monero and other cruptocurrencies when I still used them (took a break from the scene). No one can steal your identity or your money withhout you yourself making a mistake.
By giving equifax the death penalty, future shareholders should choose between competitors, including on who will do the better job with accuracy and data security.