The question of whether privacy law governing the private sector should be state
or federal seems arcane, but it is very important.
State laws have guarded privacy for more than 100 years. Both
contract law and the law of torts, which are the primary sources of privacy
protection, are made at the state level. We benefit from the federal system,
and the Constitution limits the powers of the federal government
for this reason, among others. Different states may experiment with different approaches to
public policy questions like privacy; all states may benefit by learning from the
experience of others.
As communications and transportation have improved, markets have increasingly
become national. This has more and more put states in the position of appearing to
regulate national commerce for the benefit of their own businesses and citizens.
The Constitution's Interstate Commerce Clause gives Congress the power to regulate
commerce among the States to prevent this very occurrence. The Supreme Court has
sometimes found state laws to violate the "dormant Commerce Clause" when they impose
themselves on national markets.
The burden of complying with many states' laws can be great, and companies doing
business nationally sometimes seek uniform national standards in order to ease this
burden. Doing this in the area of privacy, however, would take too much power from states,
which, again, have been the chief protectors of privacy standards as they have evolved
experimentation that is such a clear benefit of our federal system.
Instead of preempting state authority and imposing a single national standard,
Congress should make a law striking down state and local privacy mandates that
adversely affect interstate commerce, discriminate against out-of-state interests,
or conflict with federal law. Otherwise, states should retain the powers they already
have to regulate privacy.
A State Recipe for Cookies: State Regulation of Consumer Marketing
Information [pdf], by Bruce H. Kobayashi & Larry E. Ribstein, George Mason
University School of Law (January 16, 2001)
Reform: Seven Options for Congress by Adam Thierer, The Heritage Foundation
(January 27, 1999)
Materials on American Federalism Web page, Professor Douglas G. Amber, Purdue
Federalism / States' Rights, Project Vote Smart (1999)
U.S. Federalism Site by
Kala Ladenheim (1999)
Flowchart and accompanying text by Professor Karl Manheim, Loyola Law School (Spring, 1998)