But, this kind of software searching and filtering is primitive in comparison to what the IRS apparently is capable of doing. In an article in USNews, Richard Satran writes:
- The Internal Revenue Service is collecting a lot more than taxes this year—it's also acquiring a huge volume of personal information on taxpayers' digital activities, from eBay auctions to Facebook posts and, for the first time ever, credit card and e-payment transaction records, as it expands its search for tax cheats to places it's never gone before. The IRS, under heavy pressure to help Washington out of its budget quagmire by chasing down an estimated $300 billion in revenue lost to evasions and errors each year, will start using "robo-audits" of tax forms and third-party data the IRS hopes will help close this so-called "tax gap." ... In presentations, IRS officials have said they may use the big data for:
- Charting and analyzing social media such as Facebook
- Targeting audits by matching tax filings to social media or electronic payments
- Tracking individual Internet addresses and emailing patterns
- Sorting data in 32,000 categories of metadata and 1 million unique "attributes"
- Machine learning across "neural" networks
- Statistical and agent-based modeling
- Relationship analysis based on Social Security numbers and other personal identifiers
(BTW, as I pointed out in a blog post yesterday, I don't understand why it is a criminal offense for banks to "robo-sign" foreclosure applications, but it is ok for a government agency to use "robo-audits.")
Now consider some additional facts. During the 2012 campaign, Dan Wagner of the Democratic National Committee (DNC) also built big data analytics models that allowed the DNC to understand voters at the level of the individual. In an article in the MIT Technology Review entitled "How President Obama's campaign used big data to rally individual voters," Sasha Issenberg writes:
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Starting in June [of 2010], [Wagner] began predicting the elections’ outcomes, forecasting the margins of victory with what turned out to be improbable accuracy. But he hadn’t gotten there with traditional polls. He had counted votes one by one. His first clue that the
party was in trouble came from thousands of individual survey calls matched to rich statistical profiles in the DNC’s databases. ... Wagner's techniques marked the fulfillment of a new way of thinking, a decade in the making, in which voters were no longer trapped in old
political geographies or tethered to traditional demographic categories, such as age or gender, depending on which attributes pollsters asked about or how consumer marketers classified them for commercial purposes. Instead, the electorate could be seen as a
collection of individual citizens who could each be measured and assessed on their own terms.
BusinessWeek describes the activities of Wagner's team as follows::
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Wagner’s team pursued a bottom-up strategy of unifying vast commercial and political databases to understand the proclivities of individual voters likely to support Obama or be open to his message, and then sought to persuade them through personalized contact via
Facebook (FB), e-mail, or a knock on the door.
Dan Wagner has now gone on to found Civis Analytics, a big data analytics company that hopes to use the team and technology developed during the Obama campaign to influence the outcome of future campaigns. The sole investor in Civis Analytics is Google's Eric Schmidt. BusinessWeek elaborates on Schmidt's well-known connections with the Democratic Party:
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During the 2012 campaign, Barack Obama’s reelection team had an underappreciated asset: Google’s (GOOG) executive chairman, Eric Schmidt. He helped recruit talent, choose technology, and coach the campaign manager, Jim Messina, on the finer points of leading a large
organization. “On election night he was in our boiler room in Chicago,” says David Plouffe, then a senior White House adviser. Schmidt had a particular affinity for a group of engineers and statisticians tucked away beneath a disco ball in a darkened corner of the
office known as “the Cave.” The data analytics team, led by 30-year-old Dan Wagner, is credited with producing Obama’s surprising 5 million-vote margin of victory.
The fact that Schmidt is a well-known supporter of the Democratic Party raises the obvious question of whether Civis will be working exclusively on behalf of Democratic campaigns. Other obvious questions to ask are: Did the software built by Wagner's team also search for terms like "Tea Party" or "Patriot" (or the negation of these terms) in order to identify the characteristics and "proclivities" of indvidual voters? Did Wagner's team or the DNC share the list of search terms they were using (or any other aspects of the data models they developed) with the IRS?
If you connect the dots, the following picture begins to emerge: The founder of the biggest big data company in the world, Eric Schmidt, a well-known supporter of the Democratic Party, is working together with former members of Obama's campaign organization to develop big data analytics software to support Democratic campaigns. This software will be used to "measure and assess" voters at the level of the indvidual. It will seek to do this by integrating information about these individual voters from a wide variety of digital sources, in essence, tracking the behaviour of individuals as they move around on the World Wide Web or engage in e-commerce transactions or send e-mails. This same kind of analytics is being used by the IRS to develop profiles of individual taxpayers so that these individuals can be subjected to audits.
In sum, we are entering a brave new world. Obama used big data analytics to snoop into the private lives of individuals and influence how they vote. Once elected, Obama recruited the IRS to support Obamacare. The IRS, in turn, has built big data analytics capabilities for the same purpose of snooping into the personal attributes and activities of individuals.
Big Data meets Big Brother.
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