MAY 1991 - VOLUME 12 - NUMBER 5
E C O N O M I C S
Facts for Sale
by Holley Knaus
Roaring into office on a bandwagon of anti-government sentiment, the Reagan administration sought to curtail all forms of government activity (with the critical exception of defense). Even the most basic government functions came under attack, as the administration argued that they could be more efficiently performed by the private sector.
This ideological assault, coupled with the rise of an increasingly strong information industry lobby, has led to sharp restrictions on citizen access to government information. David Stockman's Office of Management and Budget encouraged government agencies to hire private contractors to distribute government- acquired information. As a result of this "privatization," citizens or organizations seeking information from government agencies as varied as the Census Bureau and the Federal Maritime Commission must increasingly rely on data companies such as Knight-Ridder, Mead Data, McGraw Hill and Martin Marietta Data Systems.
Information disseminated through the private sector is much more remote from the public, however, primarily because it is often prohibitively expensive. Private information vendors, under no obligation to provide the public with low-cost access to government data, charge exorbitant prices for their services and products. Anne Heanue of the American Library Association says that most "public interest groups, much less individuals, simply can't afford to use expensive ... [private] services," and are cut off from information collected at their expense.
Now public interest groups fear that Congressional legislation proposed as part of a "Paperwork Reduction Act" will contribute to even further privatization of information dissemination. Provisions of the legislation would discourage government agencies from providing information to the public if doing so would put them in competition with private vendors, even if the government could provide the information at a much lower cost.
The Reagan administration's privatization thrust was codified in the Office of Management and Budget (OMB) Circular A-130, which was issued in December 1985. It instructed agencies to give public notice before offering new products or services, so that private information vendors can voice their objection; ensure that existing and planned major information systems do not unnecessarily duplicate information systems available from other agencies or the private sector; and place "maximum feasible reliance" upon the private sector for the dissemination of information products and services.
Librarians and public interest organizations charge that the combination of A-130 and Congressional legislation passed at the urging of private information vendors makes it difficult for citizens to obtain access to much government information. Heanue says that the circular has "a chilling effect" on government agencies' efforts to disseminate information in formats that citizens can use, such as on-line computer access to data.
For example, according to the Washington, D.C.-based Taxpayer Assets Project (TAP), the Department of Commerce offers the National Trade Data Bank, a database of over 100,000 documents containing political, economic and technical information relating to foreign trade from 16 federal agencies, on a CD-ROM disk for $35. However, Congress has prohibited the Commerce Department from offering on-line access to the database. Since most users do not have a CD-ROM disk drive, they are forced to turn to commercial vendors to receive the information. These commercial vendors receive the data on magnetic tape or CD-ROMs at low rates, and then program it so that it is available on-line to individual users with personal computers--at extravagant rates. McGraw Hill's Data Resources, Inc. (DRI) charges its users up to $80 per hour and $0.54 per number to receive this information.
There are many other cases where the public is unable to obtain direct access to government data. The U.S. Department of Agriculture's AGRICOLA database of abstracts on agriculture and pesticides is only available on-line through a private vendor, at a cost of $45 per hour and $0.23 per abstract. The Federal Maritime Commission was prohibited by Congress from offering on- line access to its new electronic ocean tariff filing system-- the public can only obtain on-line service through Knight-Ridder or other private vendors at great cost.
The SEC spent $43.9 million in 1990 to create its EDGAR system of electronic filing of corporate disclosure reports, yet, charges Joan Claybrook, president of the Washington, D.C.-based Public Citizen, the system "is deliberately designed to provide the most minimal access." The public's only direct access to the system will be through three reading rooms in Washington, D.C., New York and Chicago. Remote on-line access will be provided only by a group of private firms, including a Mead subsidiary, which have been contracted to operate EDGAR. "There is no technological or economic reason why the public should not be able to open accounts and make full on-line use of EDGAR, in return for the payment of subscription fees," Claybrook testified at an April hearing of the Joint Congressional Committee on Printing. "Denying public access to this system [only] serves the private interests of the commercial vendors who sell SEC disclosure information."
Private vendors are able to earn substantial profits on many government databases. Government agencies collect the information and assemble it; the private vendors need only make an initial investment in the hardware to read magnetic tapes or CD-ROM disks and provide on-line services, and develop a software program to make the information accessible to individual users. Given improvements in computer technology, the costs to vendors of providing services to end users is low. As James Love, director of TAP, told the Joint Committee on Printing, "It is no secret that computer technology has undergone enormous changes which have lowered prices for computing power and data storage by factors that are hard to comprehend."
Nancy Kranich, chair of the American Library Association's Coalition on Government Information, points out that privatization of government information results in problems other than just high prices for individual users and unearned high profits for information companies. When information is placed in the private sector, it is no longer provided free to the Depository Library System, which Congress set up in the 19th century to ensure public access to government information in every congressional district. Furthermore, private vendors are interested in the money to be made off the information, not with the information itself. Kranich says they "play no role in archiving or preserving" the data, and worries that much information will be lost when the immediate market for it fades.
The disinformation lobby
Despite the obvious costs to the public, the privatization of government information dissemination has continued during the Bush administration. This is largely due to the Information Industry Association (IIA), which aggressively represents over 800 information vendors. The IIA justifies privatization with dire warnings about the dangers of "government control" of information of which it is the sole supplier. A July 1990 IIA statement urged Congress to adopt a dissemination policy that "fosters and preserves a diversity of information sources independent of government control and funding, thereby minimizing citizen dependence upon government as the sole or primary source of information."
Librarians and public interest groups charge that these assertions are empty rationalizations of the information industry's self-interest. Since the information in question is collected by the government, the real issue, says Kranich, is who should be allowed to provide it to the public in a usable form. She says that the industry position is "if the private sector wants to [provide value-added services], the government shouldn't do it at all."
Ken Allen, senior vice president of IIA, says that the government has a responsibility to ensure citizen access to public information, but that alternative sources can often do a better job of providing the information than the government. In response to criticism of the high prices often charged by these alternative sources, Allen asserts that there is "no evidence that the government can produce materials more efficiently" and that a "competitive marketplace will drive down the price" of receiving data. Librarian and public interest groups say, however, that they do not object to private firms providing services also offered by the government, and if the industry genuinely supports competition, it should not object to government participation in the information dissemination market.
Allen suggests that government funds should be spent, not in developing software or on-line services to ensure public access to information, but in providing the Depository Library System with the "resources" to acquire privatized information from commercial sources. The idea that the government should pay for information that it has collected and could provide to libraries directly is rejected by public interest advocates, who claim it represents a double giveaway to the information companies--first the government gives them the information, then it pays them for the data.
A tool for vested interests
Last fall, Congress considered amendments to the Paperwork Reduction Act (PRA) that would have furthered the privatization of the dissemination of government information. The bills introduced in the House (HR 3695) by Representative Robert Wise, Jr., D- WV, and the Senate (S. 1742) by Senator John Glenn, D- OH, were supported by the IIA. They were opposed by librarian and many public interest organizations, which, according to Kranich, "strenuously objected" to further privatization and provisions of the bills which gave OMB a primary role in making decisions about dissemination that they believed would be better left to individual agencies.
The bills would have required agencies to determine if private sector information products or services "reasonably achieved" agency objectives. While the bill was ambiguous on the authority of agencies to compete with the private sector, virtually the entire library community opposed the legislation.
Kranich says that librarians feared this language "could be pushed very hard by the private sector" to discourage agency dissemination of data. In a letter to Representative John Conyers, Jr., D-MI, chair of the Committee on Government Operations, opposing the legislation, Love wrote that the statute "will demand that the agency give the vendors special consideration. A member of Congress will only have to ask the agency to justify its decision, perhaps in painstaking detail. The burden of proof will fall on the agency, to show that it is justified in providing services the private vendor wants to make money on. The statute will prejudice the agencies' deliberations, and proponents of privatization, including those with vested interests, will have gained a useful tool."
Heanue explains that the American Library Association and other library organizations were concerned that the PRA "gave OMB too much power" in determining dissemination policy. While government departments have to take budget issues into consideration in determining dissemination procedures, Kranich argues that the agencies, not OMB, know what information is needed by their constituents and that the final decision should be left to them.
The bill passed in the House but was never voted on in the Senate. A new version is expected to be introduced in May or June 1991.
Opening a window of information
Rather than just opposing further privatization of public information, library and many public interest groups are proposing steps to make government information more available to the public. The American Library Association, the Taxpayer Assets Project and Public Citizen are currently working on a proposal to introduce a "GPO On-line Window to Government Information." The Window would be established by GPO as a single point of on-line access to a range of electronically stored federal databases, initially consisting of the Federal Register, the Congressional Record, the Economic Bulletin Board, the Department of Energy's "Energy" Publication, agency and White House press releases, Federal Election Commission campaign contributions, U.S. Supreme Court opinions, the National Trade Data Bank, MEDLINE (the National Library of Medicine's index of medical research) and several others. The information would be priced at cost for most users, and would be provided free through the Depository Library System. Federal agencies would continue to disseminate information through current methods and to collect and disseminate information not offered through the Window.
Because the Window would be a centralized source of information, users would only have to pay one access fee, rather than separate ones for each agency's database. It would also allow citizens to look in one place for a wide range of government information. Claybrook told the Joint Committee on Printing that "there is a desperate need for a central system, or one-stop shopping center, for easier access for the public and for businesses to electronic information."
Moreover, say its advocates, the Window would not be expensive. Love points to the example of the Department of Commerce's Economic Bulletin Board, which contains a wide array of economic data and for which users are charged as little as $3 an hour for online service. The Economic Bulletin Board receives about 12,000 calls each month and is self-supporting.
"The U.S. government is the world's most important source of information, and the rules about how [its] information is disseminated are enormously important," Love told the Joint Committee on Printing. The Window proposal reflects the belief that "government agencies should provide citizens with broad and low-cost access to government information."