Living in a big data world

Steve Merrell |

Earlier this month, the Wall Street Journal published an article on Google’s attempt to gain access to millions of medical records. According to the Journal’s report, Google has deals with some of the country’s largest health care companies allowing them to “view or analyze tens of millions of patient health records in at least three-quarters of U.S. states.” Some of these deals allow Google to access complete health records, including patient names, dates of birth, medical conditions, medications and other personally identifiable information.

Google’s response to concerns about their health care project was typical big tech. They first apologized for not being more transparent and then maintained the virtue of their endeavor. Dr. David Feinberg, the head of Google Health, told the Journal, “I came here to make people healthy, I’m not here to sell them ads. Google is so good at being helpful. We want to be helpful with knowledge, success, health and happiness.”

Forgive my skepticism. While Dr. Feinberg’s motivation may be altruistic, you can rest assured Google is a profit-making enterprise and those profits are driven by big data.

Big data refers to the mountains of data you and I generate as we go about our day-to-day lives. From a big data point of view, everything we do during every waking moment is a data point waiting to be measured, catalogued, and stored away for future retrieval and exploitation. In fact, we don’t even need to be awake to generate data, as numerous sleep apps attest. Even our sleep habits are a treasure trove of data.

Collecting and manipulating data is nothing new. Humans have been at this for thousands of years. But there is a big difference between the data collection of the past and the big data of the present. Big data is a thoroughly modern phenomenon made possible by the advent of tools to collect vast amounts of data, store it economically and then harvest the information embedded in it. With big data, every aspect of our lives is open to scrutiny. If you want to see a real-life dystopian view of big data’s future, take a look at China’s mass surveillance network and the social credit system they are developing.

China’s social credit system is an Orwellian attempt to track the activity of its citizens and evaluate them for “trustworthiness.” If you were in China, your social credit score would be determined by an algorithm that would include, among other things, financial data, employment history, and work performance ratings. You would earn points by performing heroic acts or lose points by jaywalking, playing your music too loud, eating on the public transit system or incorrectly sorting your garbage. And don’t kid yourself—the consequences of a low social credit score are very real. According to a June 2019 report by the National Development and Reform Commission of China, 27 million air tickets and 6 million high speed rail tickets were denied to people who were deemed to be “untrustworthy” (i.e., didn’t have high enough social credit scores.) 

So why write about this in a financial planning column? Because big data will increasingly define the financial world we live in. Whether you need a loan or an insurance policy or a new job, you may one day face something akin to China’s social credit scoring system. Last year, for example, the New York Department of Financial Services released guidelines that allow insurance companies to use data from customers’ social media posts during underwriting. And it isn’t a stretch to imagine an insurer rating your car insurance based in part on information about your driving behavior tracked on an app like Waze or Google Maps. How will these practices evolve in a big data world?     

You and I need to see ourselves as the Chief Information Officers for our lives. We need to guard our data carefully. The footprints we leave all over the internet allow big data companies to know more about us than we can imagine.

 

Steven C. Merrell  MBA, CFP®, AIF® is a Partner at Monterey Private Wealth, Inc., a Wealth Management Firm in Monterey.   He welcomes questions that you may have concerning investments, taxes, retirement, or estate planning.  Send your questions to: Steve Merrell, 2340 Garden Road Suite 202, Monterey, CA  93940 or email them to steve@montereypw.com.