Friday , April 20 2018
Home / EconLog Library / A digital ID for all?

A digital ID for all?

Summary:
Does a national ID strike you as an encroachment on individual liberty? Would it be just another nuisance? What if this nuisance is compensated with substantial benefits... The Wall Street Journal ran an interview by Tunku Varadarajan with former Estonian President Toomas Hendrik Ilves. A side note: I came to enjoy Varadarajan's writings, especially his interviews, a lot. He has an eye for the new and the profound. Writes Varadarajan:Mr. Ilves wants America to be more like Estonia. Since 2001, every Estonian has had a digital ID card with a chip, as well as a code number known only to the individual. That enables a "two-factor authentication for every transaction, requiring your chip and your code," he

Topics:
Alberto Mingardi considers the following as important:

This could be interesting, too:

Don Boudreaux writes Some Links

Don Boudreaux writes Some Links

Don Boudreaux writes New York Times Letter on Occupational Licensing

Scott Sumner writes When “deregulation” becomes crony capitalism

A digital ID for all? Does a national ID strike you as an encroachment on individual liberty? Would it be just another nuisance? What if this nuisance is compensated with substantial benefits...

The Wall Street Journal ran an interview by Tunku Varadarajan with former Estonian President Toomas Hendrik Ilves. A side note: I came to enjoy Varadarajan's writings, especially his interviews, a lot. He has an eye for the new and the profound.

Writes Varadarajan:

Mr. Ilves wants America to be more like Estonia. Since 2001, every Estonian has had a digital ID card with a chip, as well as a code number known only to the individual. That enables a "two-factor authentication for every transaction, requiring your chip and your code," he tells me. He scoffs at the more common practice of requiring an email or username plus a password. "All identities based on this 'one-factor' model," he says, "are hackable through brute force. You simply need enough computing time, and really not that much of it."

If he were appointed America's digital czar, he'd "implement a digital ID system for everyone, but do it at the state level." He'd expect political opposition. Estonia logs its residents' digital identities in a national registry, but "citizens in Anglo-Saxon countries regard that sort of thing as Orwellian. They say that this would diminish privacy. But where's the logic in it?" The state, he contends, is "already validating who you are in your passport and your driver's license."

There's no doubt that many Americans would find Mr. Ilves's ideas uncongenial, particular his belief that the successful digitization of a society can happen only if digital IDs are mandatory and universal. "It is a matter of behavioral economics," he says. "Everyone must have one. They need not use it, but they need to have one. Because, if the digital ID isn't universal, digital services will not be developed." Where digital IDs aren't mandatory--including most European Union countries--"neither the public sector nor the private has made efforts to invest in these services. Administration remains a 'paper' affair, and banks don't invest in genuinely secure banking." In most EU countries without a mandatory card, "the e-ID uptake is 15% to 25%. Why bother developing a service if 75% to 85% of the population can't even use it?"

In a way, it seems to me that President Ilves is saying: if you need to do it, do it better. Paper identity cards are easy to counterfeit; I suppose this creates costs for checking and enforcing their authenticity, plus of course counterfeit IDs create a burden for society, as they allow for transactions that shouldn't be happening, and at some point will create further problems and uncertainty.

Still, I would be interested in your reaction to the proposal of a national ID, albeit a digital one. As a libertarian and a paranoid, I find these arguments put forward by the American Civil Liberty Union instinctively plausible. The Electronic Frontier Foundation also has an interesting collection of arguments against going in that direction.

At the same time, as a European, I understand Ilves' more or less implicit argument: we are basically used to having IDs; it seems by now "natural" to us, like the sun rising in the morning, why not have a smarter system of identification then?

A counter-argument is that, in any country bigger than little Estonia, where collective decision making is more intensively prone to special interest groups' influence and generally speaking more opaque, chances are good that a government monopoly can't evolve in a smarter system simply by digitising it.

Another counter-argument could be that we do not know what is the "right" amount of identification, and we are not going to know it if it keeps being entrusted to a monopoly. At the same time, particularly now, we have tons of ways in which we can identify ourselves (isn't a phone with face ID more reliable than any document for that?) and it is debatable that one which is blessed by the government is ipso facto better. Moreover, a government monopoly of identification tends to be able to "talk" only with other government monopolies of identification: which creates problems, particularly with migrants who may come from jurisdictions where the public administration is either very inefficient or very corrupt (or both) and thus, lacking documents, are by definition pushed in the underground economy.

But, as I said, I'd be particularly interested in other people's reactions. Does a national ID still strikes you as an encroachment on individual liberty? Would it be just another nuisance? What if this nuisance is compensated with substantial benefits, as Mr Ilves seems to believe? Thanks in advance for your comments.



Alberto Mingardi
Mingardi, one of the rising stars of European libertarianism, is the founder and Director General of the Italian free-market think tank, Instituto Bruno Leoni. His areas of interest include the history of economic thought and antitrust and healthcare systems. He is particularly well known for popularizing the work of past scholars under-appreciated by today’s libertarians. Currently an adjunct scholar at the Cato Institute, Mingardi has also worked with the Heritage Foundation, the Atlas Economic Research Foundation, the Acton Institute, and the Centre for a New Europe.

Leave a Reply

Your email address will not be published. Required fields are marked *