After numerous delays and extensive cost overruns, Honolulu’s Skyline passenger rail system launched on June 30. Skyline is the first U.S. system to use automated trains, hopefully serving as an example to the nation’s other urban transit operators. Driverless train technology is common in Canada, Asia, France and at U.S. airports. They offer lower costs and the potential for more frequent service.

Skyline opened with five days of free service through July 4, when daily ridership peaked at 18,108. The elevated train system with its unique views proved to be something of a tourist attraction during the holiday weekend. But when Skyline began to collect fares on Wednesday, July 5 ridership plummeted to only 1,245. (It subsequently revised the total to 3,276 stating that the original figure did not include passengers transferring from buses). The city expects that after a year, daily ridership will stabilize in the range of 8,000 to 10,000.

All of this is a far cry from original projections. The project’s 2010 Environmental Impact Statement projected that ridership would reach 116,300 in 2030. As late as 2018, Honolulu officials were offering aggressive ridership projections of up to 121,600 per day in 2030.

One reason that today’s ridership is so far below the old forecasts is that only a portion of the system is now in service. The 2030 ridership projections applied to the full 20-mile, 21-station system originally planned. The phase that just opened encompasses the easternmost 11 miles and nine stations. The two westernmost stations have been dropped from the project to contain cost overruns.

But much of the gap between real and forecast ridership levels is attributable to excessively optimistic modeling assumptions. As recently as 2020, the city thought daily ridership on the initial nine-station segment would by over 19,000 or double the city’s latest prediction.

A longtime critic of Honolulu’s transit plans, University of Hawaii Civil Engineering Professor Panos Prevedouros, previously offered a projection for the full system that was also about half of official forecasts. He came to this conclusion after seeing a decline in Honolulu bus ridership as well as very low ridership on Tren Urbano, a similar rail system in Puerto Rico.

Dr. Prevedouros offered the following reaction to the first day ridership figures:

While the recent numbers are truly abysmal, it’ll take till about November of this year for ridership to settle down to a representative number of rail and bus ridership on Oahu, from which one can make a reasonable estimate about the ridership of the full line. If I were placing a bet, I’d be betting on more abysmal levels of ridership, much worse than those I estimated in the 2010s, which were about half of what HART (the Honolulu Authority for Rapid Transit) was projecting.

Aggressive ridership forecasts are not unique to Honolulu. Earlier in 2023, San Francisco’s $2 billion, 1.6‑mile Central Subway began revenue service with a far lower number of passenger boardings than originally anticipated.

Had ridership projections been more realistic, perhaps Honolulu would have opted to serve the route with Bus Rapid Transit (BRT) instead of rail. Individual BRT vehicles can accommodate up to 300 passengers and BRT lines in several international cities handle a peak load of over 10,000 passengers per hour. In the US, the Los Angeles Metro G Line served about 30,000 passengers daily at its peak before the pandemic. If the LA line was grade separated and not impacted by traffic signals, its capacity could be far higher.

Not only does BRT have adequate capacity for the Honolulu Skyline, its use would not have had a major impact on travel times. While trains have much higher maximum speeds than buses, this difference is only material when stations are far apart. On the Skyline, stations are no more than a couple of miles apart and trains will achieve a maximum speed of only 55 mph.

Had Honolulu opted to run large buses rather than trains along the elevated Skyline, it could have started service far sooner and at much lower cost than with a rail-based solution. And a less aggressive, more realistic ridership forecast may have led to the conclusion that Skyline was best served by BRT. For other local governments considering new transit services, Honolulu’s lessons are worth considering.

There is no such thing as a panacea; few things are actual cure-alls in themselves, especially when it pertains to social issues. However, the closest thing to a panacea for contemporary social injustice—both actual and perceived—is the concept of individualism. It is the closest foil to what is, arguably, the most dangerous aspect of critical social justice activism: race fatalism, i.e., the idea that especially minoritized groups have no locus of control and are at the mercy of their hegemonic oppressors.

Unfortunately, too many social justice activists embrace this fatalism and, both implicitly and explicitly, demonize individualism as an inherently oppressive, white supremacist concept.

Race fatalism cannot exist without the idea that all people from a given race experience the world similarly (race essentialism), and that we are forever defined by our home environments (linked fate), concepts that could not be more opposed to individualism. Thus, to embrace individualism is to relinquish faith in the fundamentals of critical social justice.

Fortunately, when individualism destroys these fundamentals steeped in powerlessness, it gives birth to agency and freedom conducive to an empowered and fulfilled life.

The most egregious aspects of critical social justice activism—now wryly and/​or disdainfully referred to as “woke” activism—can be considered footnotes of fatalism: skin-color and or gender determine if you are a perpetual oppressor or a perpetual victim; racism will never go away and can only be managed; black kids can’t learn math like other kids; all people who look the same or live in the same area are bound to a particular outlook and particular fate. All these suggest the “truth” of race essentialism, that racism is always already present, and that even words, if coming from an oppressor, are literal violence.

The power of this fatalism is weakened by the concept of methodological individualism, what can be understood as an embrace of free will with an acknowledgement that we live an interdependent existence, i.e., “no man is an island.”

In recent essays, I describe such individualism as an antidote to race essentialism and linked fate. In “Individualism is a Social Justice Issue,” I insist that the embrace of individualism can enhance racial justice through its implied refutation of linked fate and its conduciveness to defensive confidence.

Regarding linked fate, I write, “linked fate denotes the use of the social standing of a group as a proxy for one’s individual identity, i.e., an individual’s fate is inevitably and intricately linked to that of the group. Any individual that seems to escape this fate is considered an exception.” Linked fate depends on the debunked stimulus-response theory in behavioral science: the idea that people who share the same race or culture experience the world the same way. Senator Tim Scott’s passionate rebuttal of linked fate focuses on the idea that educational reform is the thing that can unlink fate most efficiently and instill a sense of agency in students, a sentiment elaborated upon by Ian Rowe.

Agency, or “agential fate,” a concept of individual efficacy I support in “Ditching Our Discourses of Doom” (excerpted here), “can be construed as a confluence of pre-established circumstances—one’s life experiences—combined with free will.” This concept necessitates the belief “that each individual in a particular context may react to stimulus in different ways; that they each may have a different desired future state; and that their decisions and choices matter in relation to achieving those future states, we enter into a place of agency, possibility, and hope.”

This agency, possibility, and hope imply the concept of defensive confidence I reference in a recent Discourse article. If people have defensive confidence—the confidence that one can successfully defend one’s ideas in given situations—they are more likely to engage the world more courageously as individuals unbeholden to a group and is, ironically, more likely to have one’s mind changed precisely because of this willingness to engage.

These concepts suggest the benefits individualism can have to a sense of social justice and, especially, in combatting the fatalism of social justice activism. Individuals can think independently, adapt to circumstances, and, therefore, more effectively exercise agential fate and defensive confidence, thus better ensuring an attempt to communicate across differences.

Sadly, the concept of individualism is almost anathema in critical social justice circles, in which group identity is favored and individualism is considered an oppressive concept. Race essentialism, which implies concepts like linked fate and group consciousness, is a foundational concept in critical social justice that is diametrically opposed to individualism.

Individualism is not only the best thing for curing the ills of social injustice; it is also, by nature, the downfall of critical social justice ideology. For this reason, maybe “panacea’s” more colloquial synonym, “magic bullet” would be more apropos.

In July 2021, Arizona lawmakers took a small step in the right direction by allowing women to obtain self-administered hormonal contraception directly from a pharmacist providing a state or county public health official licensed to practice medicine issues a “standing order” that effectively makes them the prescribing clinician. Thus, Arizona joined its neighboring states of Utah, New Mexico, Colorado, Nevada, and California in fashioning workarounds to the Food and Drug Administration barring women from obtaining contraceptives unless they get a permission slip from another autonomous adult (i.e., state-licensed health care practitioner).

Yesterday, Arizona Governor Katie Hobbs took the state a step further in the right direction by issuing an executive order enabling women to go directly to pharmacists to purchase self-administered hormonal contraceptives. While the American College of Obstetrics and Gynecology (ACOG) and the American Academy of Family Physicians (AAFP) don’t think it is necessary, the executive order requires that pharmacists perform screening and blood pressure evaluations on women before dispensing contraceptives.

Despite the recommendations of ACOG and AAFP that women of all ages have access to over-the-counter contraception, the 2021 Arizona standing order law only pertains to women over 18. The governor’s executive order likewise only applies to women over 18. This means younger women still must see a doctor to get a prescription, likely involving their parents in the process—which is not an effective way to cut down on unwanted teen pregnancies.

Ironically, the FDA has allowed emergency contraceptives, also called “morning after pills,” to be available over the counter for women of all ages since 2014.

Blogging about Arizona’s new standing order law in 2021, I wrote:

I have argued that standing orders can be an effective way to bring interim relief to people blocked from exercising their right to self-medicate. But the operative word here is “interim.” Standing orders have a lot in common with executive orders. They are issued by an executive branch official—in this case, a public health official who holds a state health care practitioner’s license—and are usually time-limited. Furthermore, standing orders remain in effect as long as the public health official wants them to, and only if the following public health official is a licensed health care practitioner and decides to renew them. (Even worse, public health officials are not always licensed health care practitioners.) Since most public health officials answer to the chief executive, the security of standing orders is at the mercy of administration policy.

In my commentary, I urged Arizona lawmakers to pass legislation to expand the scope of practice of licensed pharmacists. Several states have used this approach to work around the FDA’s prescription requirement. Such an approach immunizes the reform against changes in the attitudes of public health officials or governors.

Though she should have applied it to women of all ages, Governor Hobbs should be commended for her effort to expand access to hormonal contraceptives. However, unless Arizona lawmakers authorize pharmacists to prescribe contraceptives, the governor’s accomplishment can be erased by her successor.

Of course, the ultimate solution is for the FDA to “free the birth control pill” so that women of all ages can exercise their autonomy to self-medicate.

Meta launched a new text-based social media app called Threads on July 5. The app—which is connected to Instagram—has been referenced by both the media and users alike as an alternative to Twitter. There is much excitement about the latest social media app and Threads tells us a lot about the dynamic nature of the social media marketplace and the potential impact of regulations aimed at leading technology companies.

Threads Illustrates Social Media Remains Dynamic

There has been much handwringing about whether today’s social media giants are monopolies. Threads illustrates that there are new entrants into the market and, at a minimum, that there is continued competition between even the most successful tech companies.

Elon Musk’s takeover of Twitter was met with applause by some, but left others searching for alternatives following his changes to the product, including the loss of certain features without paying for a monthly subscription to Twitter Blue and changes to content moderation policies. To at least some users, Threads appears to provide an alternative with a similar text-focused experience. Some may have avoided leaving for new social media apps out of concerns about a steep learning curve or a requirement to rebuild one’s connections on a new app. Threads’ connection to Instagram allows existing Instagram users to port over their connections from a platform that they are already comfortable with.

Still, Threads and Twitter are not the only text-based social media apps available to consumers. New competitors, including Blue Sky and Mastodon, continue to emerge as alternatives for those dissatisfied with current social media options. While Threads may be tied to an existing social media giant, it is only one of many alternative platforms that are competing for popularity in this format. These platforms all benefit from the United States’ light touch approach to regulating social media platforms, giving way to innovative and entrepreneurial efforts toward launching new social media products. This latest launch shows that social media remains dynamic not only with new ideas, but with new products that build on the popularity of certain formats.

What Threads Shows about How Regulation Can Prevent New Entrants

Generally, the European Union (EU) has taken a more stringent regulatory approach to a variety of technology policy issues. These regulations can stand in the way of new entrants being able to enter the market. Though over 30 million users downloaded Threads within a day of its launch, a considerable swath of consumers did not have access to the app.

Regulatory concerns have prevented Threads from currently being available in the EU, unlike its United Kingdom and United States counterparts. The Digital Markets Act (DMA) looms large in this decision, as there remains much uncertainty around its future impact on big tech companies like Meta. DMA restricts how data can be shared between platforms, having an immediate effect on an application like Threads that imports user data from Instagram. The vagueness of the DMA produces extra hurdles to entry that Meta may not want to jump over until the company has more clarity around how to comply with this recently enacted act and whether their adherence is worth the effort.

Unfortunately, the United States has considered similar policies that would change the existing consumer focus from antitrust to something that allows far more government intervention in competitive markets including social media. For example, had the Ending Platform Monopolies Act (H.R. 3825) passed in the last Congress, it could have complicated Meta’s U.S. launch of Threads by limiting its integration with the already popular Instagram platform—a feature that gave rise to the instant popularity of Threads.

The FTC’s aggressive antitrust scrutiny of tech companies could also deter those companies from launching new products or force them to focus on ongoing litigation instead. For example, the antitrust scrutiny of Microsoft in the late 1990s and early 2000s was a deterrent in its development of a mobile operating system. Microsoft co-founder Bill Gates said in 2019, “There’s no doubt the antitrust lawsuit was bad for Microsoft, and we would have been more focused on creating the phone operating system, and so instead of using Android today, you would be using Windows Mobile if it hadn’t been for the antitrust case.” With the FTC engaged in multiple actions against Threads’ parent company Meta, it’s a relief that the company was still willing to launch this new product in the United States. One can’t help but wonder what other products or services from various innovative companies might be waiting or lost out of wariness or the need for direct resources to ongoing litigation instead.

Is Threads the Next Twitter?

For all the excitement and optimism around the Threads launch, some solid caution is also needed. Given the wide array of social media options out there, Threads will have to solidify an audience of users after the immediate novelty of a new platform wears off. It is unclear how its use may fully evolve within Instagram or if ultimately the platform may become an entirely separate form of social media.

While much of Threads is Twitter-like, the platform also has unique features, namely the ability to post videos up to five minutes long. In addition, unlike Twitter after the launch of Twitter Blue, all users have access to a longer character count of 500 characters. This may attract a distinct type of content and conversation that separates Threads from other sites. While connection to an existing common tech company may help, as the case of Google’s failed social network or Twitter’s defunct Vine illustrates, it does not guarantee a home run.

Threads does, however, show that new social media platforms can quickly gather public excitement and consumers are not locked in to only the existing options. The question of if Threads becomes the next big social media app should stay firmly in the hands of consumers and not government regulators.

Industrial policy is a pillar of President Biden’s economic agenda (aka “Bidenomics”), and the White House recently cited a spike in U.S. manufacturing construction spending to show that billions (perhaps trillions) of dollars in new federal subsidies for “clean energy,” semiconductors, and other preferred industries—enacted in the infrastructure law, CHIPS and Science Act, and Inflation Reduction Act—are “working.” As I noted in a recent column, however, there are many reasons to remain skeptical of these subsidies’ overall economic benefits, even assuming they’ve actually encouraged new private investments in supposedly “strategic” goods. A new report from the Wall Street Journal provides a real-world cautionary tale in just this regard:

New York state paid to build a quarter-mile-long facility with 1.2 million square feet of industrial space, which it now owns and leases to Tesla for $1 a year. It bought $240 million worth of solar-panel manufacturing equipment. Musk had said that by 2020 the Buffalo plant each week would churn out enough solar-panel shingles to cover 1,000 roofs.

The Tesla solar-energy unit behind the plan, however, is averaging just 21 installations a week, according to energy analysts at Wood Mackenzie who reviewed utility data. The building houses some factory workers, but also hundreds of lower-paid desk-bound data analysts working on other Tesla business.

The suppliers that Cuomo predicted would flock to a modern manufacturing hub never showed up. The only new nearby business is a Tim Horton’s coffee shop. Most of the solar-panel manufacturing equipment bought by the state has been sold at a discount or scrapped.

A state comptroller’s audit found just 54 cents of economic benefit for every subsidy dollar spent on the factory, which rose on the site of an old steel mill. External auditors have written down nearly all of New York’s investment.

I highly encourage you to read the whole thing, which provides an almost textbook case for why we should continue to question U.S. industrial policy initiatives, whether part of “Bidenomics” or any other political agenda. All too often, the subsidies’ seen benefits are swamped by their unseen costs—especially after you consider alternative policies that could have achieved the same objectives with fewer taxpayer dollars and lower economic or geopolitical risks.

As I wrote last month about that U.S. construction spending surge and the “strategic” projects it’s supporting, “[m]aybe our grand, subsidy‐​driven ‘industrial transition’ will be worth it in the end (outside of favored industries, the sector is today struggling mightily), but declarations of victory at this stage are absurd.”

The Tesla factory in New York once again shows why.

“I’m not happy in my position as an educator at a school, and my son’s not happy going to school.” When Iman Alleyne realized this, her next thought was “What can we do?” This question ultimately resulted in Kind Academy, a microschool in Coral Springs, Florida.

Iman had looked for a play-based preschool for her son without much success. “I chose the closest thing that I thought was play based,” she recalls. “But even there, developmentally, there were moments where I saw things that just didn’t make sense—like forcing three- and four-year olds to write three sentences before they could go play.”

Similarly, she saw things she disagreed with at the school where she was working. She was particularly troubled by mandatory silent lunches and kids losing recess for misbehavior. To Iman, these were the kids who really needed recess for a chance to burn energy during the school day.

She pulled her son from his school at the end of the school year and began homeschooling him. “I started getting into the homeschooling groups, and I quickly recognized that this is the way education should be done. The kids were interested. The parents were engaged in their kids’ learning. Everything was very passion based,” says Iman.

Since she’d been conventionally trained, Iman was shocked by some of what she learned from the other homeschoolers. “They would tell me things like ‘you can just do school for an hour a day, maybe 45 minutes for kindergarten.’ My mind was blown by the things that these homeschoolers were doing,” she says. But Iman’s experiences were also beneficial to the homeschoolers, and some started asking her to help them plan their children’s educational paths. Before too long, Kind Academy was born.

In creating Kind Academy, Iman incorporated the best parts of what she’d learned in her education career and from homeschoolers—and left out the parts she found objectionable. There’s also a strong Montessori influence. Children are in mixed-age classrooms with a good degree of choice and freedom of movement throughout the day as they learn through discovery.

The school day generally starts with unstructured social time and then moves to a morning meeting where they discuss their goals for the day and what’s happening that week. They also talk about the character trait they’re focusing on that month. “We focused on assertiveness during the last month of school—learning how to speak up and how to ask for things, but in a way that is appropriate,” Iman explains.

The students then shift to academics, with every student working through an individualized learning path. “In the beginning, they take a diagnostic so we see where they are. So no two kids are really doing the same thing. Even the curriculum might be different for different kids,” says Iman. “We also put them in small groups where they’ll do personalized learning—it might be a one-to-three or one-to-four ratio with kids who are doing similar things for math, writing, and reading.”

After academics, they do project-based learning, which is usually an enrichment activity in things like nature, art, play, science, or stem. The children take a field trip nearly every day. They usually go to a nearby park, but they’ve also visited forests, wetlands, and a nature preserve. To wrap up the day after the field trip they have quiet time, which usually means reading, puzzles, or games.

To support parents and kids during COVID-19, Iman started offering virtual classes. “Probably within a week we went online. First we started teaching our circle time online, and then within about two weeks, we started sending out kits to everybody. We put all of our sensory, nature, art, play, math activities, and reading activities into a box, and we shipped it to parents or they came and picked it up,” Iman says.

When she began offering classes on Outschool​.com, Iman says it took off. “We went global, where we had families coming in from all over the world and seeing what we did. We did a lot of our same classes that we were doing in person, but then we started doing a lot more for older kids. Middle school is where we exploded.” At its peak, she had 3,000 kids from around the world taking Kind Academy classes during COVID-19.

Iman now offers Kind Online School as well as individual classes on Outschool. She’s also started a “Launch Your Kind” program to help education entrepreneurs open their own Kind Academies. Through that, she offers support with curriculum, marketing, enrollment, payment systems, and more. She currently has 10 “baby” Kind Academies planning to open for the upcoming school year—seven in Florida and three in other states.

When asked what advice she has for others considering a similar path, Iman points to the three Ps: passion, purpose, and a plan. On the planning front, she says, “Try to find a way to make an income. A lot of people jump into it right away and don’t have any sort of idea of how they’re going to earn income. In Launch Your Kind, I always stress budgeting—going in there and understanding that it’s going to cost money to do things.”

Iman has a new Launch Your Kind cohort starting July 27, 2023, so it’s a great time to check it out if you’ve been considering starting your own microschool.

Prior to the 2022–2023 legislative session, five states (California, Virginia, Utah, Colorado, and Connecticut) had passed consumer data privacy laws, but now the patchwork of state laws has more than doubled. Congress has continued to debate a potential federal standard with the American Data Privacy Protection Act in the 117th Congress being the first such proposal to be voted out of a committee; however, without momentum around a federal standard and with continuing and new concerns about data privacy from consumers, many states are undertaking their own policy actions around data privacy.

The patchwork nature of these individual state laws can potentially amplify compliance costs for businesses operating across different states and create confusion among American consumers whose digital footprint often crosses state borders. The potential financial impact of complying with 50 distinct state laws could surpass $1 trillion over a decade, with a minimum of $200 billion being borne by small businesses. As this patchwork grows, what does data privacy look like as the 2022–2023 legislative session comes to a close?

What happened with data privacy in 2022–2023?

As of 2023, the majority of states have considered data privacy legislation, likely in response to consumer concerns on this issue — 32 state legislatures have kicked off the debate and presented bills. Ten states have already signed comprehensive privacy bills into law. Six states—Florida, Indiana, Iowa, Montana, Tennessee, and Texas—enacted data privacy legislation this year. Oregon is the latest state to pass a comprehensive law, which is now awaiting the governor’s signature. Additionally, there are five more bills under consideration as of July 2023. Most of these bills share similarities with the existing data privacy laws in California, Virginia, and Utah.

States with data privacy acts enacted in 2023 that have followed the California model

Of the five additional states that enacted data privacy laws this year, Indiana and Montana appear to most closely resemble California’s model, which relies heavily on administrative rules. Montana, for example, even goes beyond California by creating a right for consumers to revoke their consent to data processing. None of the states that have enacted laws this year have created a private right of action as seen in a limited capacity in the current California law.

States that have followed the Virginia or Utah model

Notably, a growing number of states have passed or considered a data privacy framework that more closely resembles the laws initially passed in Utah and Virginia. This includes Iowa, Tennessee, and Texas as well as a bill still under consideration in North Carolina. Such models provide baseline protections but typically have fewer obligations or areas of covered data, limit enforcement to the attorney general, and are more likely to provide safe harbors.

Still, each proposal remains unique. For example, Tennessee became the first state to create a compliance safe harbor for companies complying with National Institute of Standards and Technology (NIST) standards. Other states have considered similar carve-outs for existing standards. Such an approach may lessen some problems with the patchwork by providing a way for a single set of best practices that could be compliant from state to state.

Notable privacy bill trends to watch

In addition to the growing patchwork of state privacy laws, this latest legislative term has also provided additional information about the debates around data privacy legislation. Notably, private rights of action continue to raise concerns and may make proposals less likely to succeed. Additionally, a new trend of health privacy-focused bills is emerging at the state level.

Currently, four states that still have active bills—Maine, Massachusetts, New Jersey, and Rhode Island—contemplate creating a private right of action. However, to date, all bills from Hawaii to Mississippi to New York that included provisions on the private right of action have failed. New York’s failed “It’s Your Data Act” had foreseen that consumers “need not suffer monetary or property loss as a result of such violation in order to bring an action for a violation.” The Washington Privacy Act was passed only after eliminating the private right of action, which was later reinstated in a very limited form by allowing a private right of action only for injunctive relief without monetary damages.

The inclusion of a private right of action for statutory violations so that individuals can sue companies without the need to prove that actual harm inflicted upon them has grave consequences. Such private right of action for statutory damages raises significant concerns about how litigation could be used to prevent innovation. While a private right of action wouldn’t pose any significant issues if the burden of proof was solely tied to demonstrating the harm, the problem arises when there’s no requirement to prove harm. Such a provision could prompt a surge in class action lawsuits, thereby impeding innovation, especially among small companies that may become more risk-averse for fear of being sued.

The United States, with its distinct litigation system, and features such as the absence of a “loser pays” rule, is more susceptible to the abuse of the private right of action for statutory violations. Illinois’s Biometric Information Privacy Act provides such a right in the context of certain collection of data and has seen everything from photo tagging to trucking companies be sued. Most of the resulting funds have gone to attorneys, with limited amounts to the class members alleged to be “violated” by the action. In the photo tagging case, Facebook was directed to pay $650 million without the necessity of demonstrating any harm. In the trucking case, truck drivers secured a $228 million judgment because, as employees, they were required to scan fingerprints to confirm their identity, again without the need to show actual harm.

A new emerging trend to watch is the ongoing debate surrounding the sponsorship of bills aimed at regulating consumer health data, primarily focusing on reproductive health data. Washington is the first state to pass such a law, which is set to take effect in 2024. In a post-Roe context, it is likely that similar legislation — particularly in blue states — will emerge, regulating actors that are not governed by HIPAA. Given the broad scope of what is classified as health data, debates on its definition, collection, and usage are likely to be heated. Such laws also raise unique compliance questions for a variety of popular apps that are not regulated as medical devices but provide consumers with empowering ways to track information from blood sugar to mental health.

What do state data privacy laws mean for consumers, innovators, and the federal privacy policy debate?

States are acting on data privacy in part because of the continued interest in the issue from constituents. In 2022, more than 80% of voters polled supported the idea of a federal data privacy law. Given that data privacy remains a concern and due to the lack of progress on a federal bill, it is unsurprising that much of the debate over data privacy has shifted to a local or state level where legislatures are able to move more quickly. But is this good for consumers and innovators?

Is there a case for data privacy legislation anyway?

While many polled consumers are in favor of data privacy legislation, there remains a great amount of difference in the actual privacy preferences they have. In fact, the overwhelming support for data privacy becomes far more complicated when you consider questions like how much an individual would be willing to pay for social media or other products as opposed to an ad-supported version. Similarly, research has shown a “privacy paradox” where revealed preferences for privacy tend to be weaker than stated preferences.

If policymakers are to consider legislation around data privacy, they should focus on real and widely agreed-upon harms, not merely expressed preferences. This approach prevents a shift toward a more European “privacy fundamentalism” that is more likely to result in conflicts both with other rights, like speech, as well as create a static approach that could deter innovation including those that may improve privacy.

Understanding the problems of a patchwork approach

The continuing, emerging patchwork of data privacy laws at a state level is likely to lead to both increased costs and confusion. This is true not only for the businesses that handle data but also for consumers.

A state-by-state approach makes it uncertain for both innovators and consumers what may or may not be done with their data. For consumers, this can create confusion about why certain products or features may not be available in their state or what rights they have when it comes to obtaining or correcting their data online. Particularly for small businesses, a state-by-state approach is likely to significantly raise costs as new compliance concerns arise in each state. In some cases, this may result in applying the most restrictive standard necessary, but in other cases, it may require development of specific features to comply. In either case, again both consumers and innovators lose out. Consumers may find themselves losing features because of standards imposed by legislatures in other states and innovators may find themselves focusing on compliance rather than the improvements that best serve their customers.

Far from being the second-best solution, it is almost inevitable that proposals will eventually conflict with one another which makes it impossible to comply with all such state laws. The most obvious example of this would be if one state chooses an opt-out model while another chooses an opt-in model, but many other conflicts could arise around issues such as data minimization or retention.

Given the potential and likelihood for conflicts and the burden on out-of-state businesses, a state-by-state approach also should give rise to dormant commerce clause concerns. The interstate (and international) nature of data means that a federal standard should be considered constitutionally necessary in this case.

Conclusion

The 2022–2023 session saw a doubling of the number of states with consumer data privacy laws. While policymakers may feel they are responding to constituent concerns, the patchwork approach remains problematic for both innovators and consumers.