• by Wendy Davis  @wendyndavis, November 19, 2009

Lawmakers Thursday questioned whether businesses are amassing too much data about consumers without their knowledge or consent.

"We have moved from an era of privacy keepers to privacy peepers and data mining reapers," Rep. Ed. Markey (D-Mass.) said at a hearing about data collection.“

Markey, who has previously said that consumers should be able to opt out of online behavioral targeting, reiterated calls for consumers to have the ability prevent companies from collecting data. "They should have the right to say no," he said.

The hearing, held by the Subcommittees on Commerce, Trade, and Consumer Protection and Communications, Technology, and the Internet, addressed both online and offline data collection. Witnesses included WPP's George Pappachen, privacy advocates Chris Hoofnagle of Berkeley and Pam Dixon of the World Privacy Forum, as well as representatives from Wal-Mart, Acxiom and LearningResources.com.

Rep. Rick Boucher (D-Va.), who is expected to soon introduce a privacy bill, questioned whether legal protections could make people more favorably disposed toward ad targeting. Referencing a recent study showing that two-thirds of Americans rejected tailored ads, Boucher asked Hoofnagle whether that percentage would change if people had more control over the collection and use of their data.

But Hoofnagle said that new laws might not change people's attitudes because many consumers currently operate under the mistaken impression that sites with privacy policies aren't allowed to share data.

Much recent debate has centered on whether Web companies should obtain consumers' explicit consent to collecting data, or should merely allow them to opt out.

But Hoofnagle argued that neither opt-in or opt-out would protect consumers. "It is easy to trick people into opting in," he said. "It is easy to manipulate people into not opting out."

Instead, he urged Congress to limit the length of time data can be retained.

Rep. Mike Doyle questioned whether data collection hurts individuals. He proposed a scenario where a person who likes to ski is wrongly targeted as a fisherman and, as a result, receives ads related to fishing. "What's the harm?" he asked.

Dixon replied that some companies can use information for purposes that can have an impact on consumers. For instance, she said, some companies put people who dispute charges into "bad customer" databases.

Lawmakers also discussed balancing the advantages of data collection with empowering consumers to control the information that companies amass. "The collection, use, and dissemination of consumer information provide many benefits to consumers, businesses, and the marketplace," Rep. Henry Waxman (D-Calif.) said in a written statement. "But they raise legitimate concerns about whether consumers have adequate control over personal information that is shared."