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Imagine a gathering of old friends. As usual they were reminiscing about fun times together. Then unexpectedly, one of the women asked, “Do you find it difficult to find items in stores that you’ve used forever?” That question triggered one of the most spirited discussions they had in years. Everyone had a list of past favorites they could no longer buy.

Then one of the guys spoke up. “I don’t know if this is the reason for our complaints, but I read an article last week about data trusts. We’ve all heard about big data. Companies have all kinds of information about us, from the stuff we buy and all that. And there are all kinds of legal and ethical issues about using their customers’ personal information. So, they get around these issues by providing their data to a trust, a data trust. The trust is set up to be an independent organization looking out for things like privacy issues. It ends up though that the data trust becomes a way that companies can share information about their customers with other companies. The data trust works like a clearinghouse so that there are no violations of privacy or ethics principles in sharing data.

“My hunch is that the data trusts are being used to predict consumer trends by combining data from many different companies. I’m guessing that’s why we can’t find our favorites. Our tastes are no longer trending.”

Data trusts are little known entities to the American public, but they have a huge impact on choices available to the public. They are widely used in financial services to predict the worthiness of loans. They are used in medicine to suggest treatment strategies. The insurance industry uses data trusts to set their rates for different types of insurance. The major political parties even make decisions on candidates they favor based upon data trust information.

Every purchase you make, every internet site you visit, virtually every electronic transaction you have provides insight for the data trust. Your education, your job, even those you contact via electronic devices are used to make up your profile. Your profile and millions of others are then aggregated to provide insights for trends in society.

What are the impacts of data trusts for a democratic society, where governing is supposed to be “by and for the people”? They do provide a useful source of data for seeing trends in the population, helping to understand “the people” at the root of democracy. If the trust is set up so the trustees are charged with safeguarding the interests of the individual consumers about whom the data is collected, then data trusts could be a way to help balance the power relations between ordinary people and powerful corporations.

But, what if a data trust is ultimately really only looking out for the interests of the corporations who gather the data? And what risks do we run of data trusts framing our perceptions (or misperceptions) of “the people” based on the trusts’ decisions to select or exclude certain data? With any accumulation of data like this, what about the risk of data leaks to hackers? What about those citizens who don’t fit within the popular trends? Will data trusts, as mechanisms for the use of big data, represent a new, hidden source of discrimination, as minority segments of the population are overlooked? And what are the impacts on a democratic citizenry of the near constant electronic monitoring of citizens’ choices and actions, monitoring that feeds into the data trusts?

Just imagine how data trusts could bring forward the voice of the public by capturing everyday decisions. But imagine also how data trusts could lead to limiting the choices of those who don’t fit the norm. Just imagine what your data profile would look like. How insightful do you think a data trust would be in capturing who you are as a democratic citizen? Finally, just imagine what freedoms you might lose because of a data trust.

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“Torture the data and it will confess to anything.” – Ronald Coase (Nobel Prize winner in Economics)

This is part of our “Just Imagine” series of occasional posts, inviting you to join us in imagining positive possibilities for a citizen-centered democracy.