Tool Without a Handle: Privacy and Moral Hazard

Discussions of privacy tend to focus on the value of privacy.  This post agrees that privacy has value in practical terms, as an important moral principle, and for its contribution to human flourishing.[1]  At the same time, these observations are incomplete.  Privacy, like security and transparency, involves trade-offs.  Indeed, it involves trade-offs with precisely those other qualities – security and transparency in particular.  Privacy, for example, protects data that would reveal fraud, lies, and other wrongdoing.

The trade-offs exist, also, within privacy itself.  Certain values that privacy enhances, it can also degrade, depending on factors such as context or on which party to an information exchange you happen to be.  For example, Daniel Solove observes that privacy is important because “in relationships…we depend upon trusting the other party,” and that “[b]reaches of confidentiality are breaches of that trust.”[2]  That is, privacy is important to enable trusted boundaries on relationships.  True enough, though privacy also enables deception by the other party, and thus enables imbalanced transactions, all of which undermine trust.  Privacy is not simply an unequivocal good, it is a good that also creates a moral hazard.

Privacy as a Moral Hazard

A “moral hazard” issue is an observed pattern that those who are protected from the consequences of risky activity are, unsurprisingly, more likely to engage in that activity, or to otherwise increase their risk levels.  It is commonly discussed in the context of business, investing, and insurance, for fairly obvious reasons:  those protected by insurance or bailouts or other measures are likely to enjoy the opportunity to experience the upside of a substantial gain without the corresponding risk of a substantial loss.  Moral hazard has also been discussed with respect to Section 230 and online content moderation.[3]

The moral hazard in privacy comes from the fact that privacy insulates an actor from the constraining influences of others and from the shame that might otherwise inhibit bad behavior.  Yes, privacy in one’s personal correspondence, browsing, and viewing habits helps individuals develop individual autonomy precisely because of this insulation, and this can contribute to human flourishing.  But people make poor choices and selfish choices at least as often as they make virtuous ones. 

Integrity, it is said, is what you do when no one is watching.[4]  We need not look far to see examples of failed integrity.  As personal networked information technologies proliferate, enabling rapid, private communications of a wide variety of content, sources of external social disapproval (or potential disapproval – i.e., risks of getting caught) that would otherwise provide discipline, erode. 

Recent high-profile cases of extramarital affairs – both facilitated by and ultimately uncovered by information technologies – are illustrative. For example, as widely reported, an FBI attorney was carrying on an extramarital affair with an FBI agent.  While most of the news attention has focused on the political views of their private correspondence, it was also reported their use of official government information tools was an attempt to keep their private affair hidden from their spouses.[5] Also, federal policy considered the extramarital affair itself troubling, in part for what it shows about good judgment and in part as it can expose both individuals to blackmail.[6]

Extramarital affairs among FBI agents and attorneys should, in theory, be unusual given FBI employees traditionally have strong loyalty to an institution whose very motto starts with the word “fidelity.”[7]  Spousal betrayal by politicians is, sadly, more well-known, and more recently these involve information technology as well.  Longtime Congressman Joe Barton (R-TX) announced he would not seek re-election after it emerged he had exchanged explicit photos with an affair partner, who reportedly threatened Barton with disclosure of them.[8]  Missouri Governor Eric Greitens disclosed he had been involved in an extramarital affair, complicated by allegations (which Greitens denies) that he blackmailed his affair partner with an explicit photo of her.[9]

I’ve written before on the harms of non-consensual publication of photos,[10] and one need not condone extramarital affairs to believe that correspondence between affair partners is still entitled to privacy, though in the FBI case, that expectation is correctly limited given the use of official government tools. But one can hold this belief while at the same time observing how privacy creates a moral hazard to the extent it enables and may foster this type of behavior.

Government officials necessarily operate in an environment steeped in secrecy, and in one where ordinary rules often do not apply (you and I cannot subpoena witnesses, command hearings, etc.), which can create a sense of entitlement.  And affairs are fueled, in part, by secrecy and a sense of entitlement.  Entitlement in the sense the affair needs rationalizations for breaking promises and values, and secrecy in the sense that the absence of external accountability allows the self-justification to persist, without intrusion from other perspectives.[11]

The privacy and secrecy that networked information tools provided worked to the disadvantage of both the betrayed spouses, and of the betraying spouses – less privacy might possibly have been a deterrent from their acts, and thus spared them the suffering they are undoubtedly facing after being found out.  And the lack of privacy ultimately worked to the good of others – both in contexts where privacy interests are high (the respective marriages), and where they are lower (public debate as to political implications)

To the extent society values marital fidelity and monogamy (and despite dramatic portrayals in the media, statistics show that by and large we do), it is critical to consider that “secrecy, many researchers maintain, is the enemy of monogamy.”[12]

Non-consensual sexual misconduct is also illustrative of privacy and moral hazard.  Also in the news are numerous concerns regarding unwelcome sexual harassment or misconduct,[13] in some cases with job loss consequences for prominent figures.[14]  Privacy remains important in these contexts:  those who are victims may not want public attention, those who are accused are entitled to fair process, and most workplaces rightly have strict confidentiality over workplace harassment allegations.

Here too, though, to the extent that privacy enables secrecy for these incidents, there are risks that misconduct persists, that those negatively affected may feel alone or disempowered to come forward, and social and moral values against sexual misconduct are weakened through perceptions they are only weakly enforced.  Privacy enables individuals to manage boundaries in relationships, true, but privacy also enables boundaries to be crossed without appropriate recourse or accountability.

Certain features of private, personal networked information tools contribute to moral hazard risks:

1) Solipsistic interfaces.  Except for gaming platforms, modern device interfaces are designed for a single user.  As such, interaction with the tools is only a shared experience in that there is another person at the other end of a communication.  Personal smartphones exaggerate this quality in that not only is the screen designed for one person, the interfaces are customized to the needs and interests of that one person.

2) Intermediated identity.  Even when parties communicate with known identities, online interactions occur in an intermediated bubble.  As noted above, affairs and harassment occur in part due to self-justification that is unchecked by outside influences but also unchecked by the person’s own conscience. Networked information technologies can exaggerate this by creating mental distance between the person, the device, the communication, the other person’s device, and ultimately the other person.  This reintermediation of conversation can further distance the person engaged in the act from the act itself, fostering self-rationalization.

3) Private binary communications.  Prior to the rise of Internet-enabled email and text messaging, affair partners would be reluctant to make remote contact by calling the home telephone, unsure of who would answer. Modern tools allow an adulterous couple to text each other while they sit next to their spouse and children, truly leading a double life enabled by private communications.  And, justifiably, each party can claim “it’s private”[15] – a personal device being subject to a different privacy standard than a shared home computer.[16]

I advocate no specific policy response to any of this.  Avoiding affairs and other misconduct involves personal emotional maturity, not a shift in privacy laws.  In fact, privacy laws correctly address moral hazard in the other direction:  by sanctioning unauthorized privacy invasions such as hacking into a spouse’s email or conducting unauthorized surveillance of a vehicle. 

Amid emotional trauma, many a betrayed spouse has lost perspective, taken up the capabilities of modern tools in a quest for proof of wrongdoing, and then found themselves in legal trouble,[17] as well as further traumatized by what is found.  Absent appropriate privacy sanctions on unauthorized interception and surveillance, we risk a moral hazard in the other direction – escalating what The Atlantic already calls the “Adultery Arms Race.”[18]

Better then, to recognize that what privacy facilitates is capable of both good and evil.  Human beings are both blessed with free will, and cursed with limited control over it.  As this blog has argued elsewhere, positive outcomes start with good judgment by users, and not necessarily with changes to either information tools or the laws that guide them.[19]  Failure to recognize that dark side, though, does a disservice to privacy and its analysis.

[1]See, e.g.,” The Value of Privacy” (review of Jeffrey Rosen’s “The Unwanted Gaze”),  online at; Julie Cohen, “What Privacy Is For,” Harvard Law Review, Vol. 126, 2013, online at:; Daniel Solove, “Ten Reasons Why Privacy Matters,” online at:

[2]Ten Reasons Why Privacy Matters,” Id.

[4]Often attributed to C.S. Lewis, though likely incorrectly:

[5]Devlin Barrett, “FBI officials’ text message about Hillary Clinton said to be a cover story for romantic affair,” Washington Post, December 15, 2017, online at

[6]Karoun Demirjian and Devlin Barrett, “Top FBI official assigned to Mueller’s Russia probe said to have been removed after sending anti-Trump texts,” Washington Post, December 2, 2017, online at:  One federal employment law firm explained further that extramarital affairs can indeed lead to loss of a security clearance due to this potential for coercion, at least so long as the affair is still private.

[7]The FBI’s motto, following the initials of its name, is “Fidelity, Bravery, Integrity.” 

[12]Pam Gerhart, “The Emotional Cost of Infidelity,” Washington Post, March 30, 1999, online at:

[15]Debra MacLeod, “Part 1:  How Technology Has Enabled Cheating, Part II,” Huffington Post,

[16]If a spouse has granted consent by using a shared password to a computer, access to that computer is likely legal under federal and state wiretap acts.  As noted, though, other forms of spying are almost certain to be illegal.

[17]See, e.g., LaRocca v. LaRocca, 2014 WL 5040720 (E.D. La. Sept. 29, 2014) (husbands interception of spousal emails violated ECPA); Klumb v. Goan, 09-cv-115 (E.D. Tenn.; July 19, 2012) (ex-wife hit with 20K in damages for email eavesdropping).  Where property is jointly owned, courts have been more lenient towards spying spouses, see, e.g., State v. Hormann, A10-18722 (Minn. Ct. App. October 19, 2011), but such spying can still result in legal charges against the spying party. 

[18]“The Adultery Arms Race,” The Atlantic, November 2014, online at:; see also “Does Technology Make it Easier or Harder for Us to Cheat,” Wired, Feb 2013, online at:

[19]“Tool Without a Handle: The Dark Side,” June 25, 2013,


Add new comment