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Clock runs down for privacy legislation

A security camera points at a computer cursor against a red backdrop
Illustration: Sarah Grillo/Axios

As 2019 began, many in Washington and Silicon Valley predicted it would be the year Congress took action on national privacy legislation — but the year is half over, and momentum has seriously slowed.

Why it matters: While members of Congress negotiate behind closed doors on a comprehensive bill that the public has yet to see, state lawmakers are forging ahead on their own.

Flashback: Six months ago, multiple sources of pressure seemed to be forcing lawmakers' to move on data privacy rules.

  1. Awareness of consumer data collection was growing, thanks to Facebook's Cambridge Analytica scandal and other Big Tech screwups.
  2. Europe’s General Data Protection Regulation, which just hit its first birthday, put Congress behind on regulating a major sector of the economy.
  3. Silicon Valley companies asked federal lawmakers to step in and preempt state rules, particularly California's privacy law set to take effect next year.

Details: The most closely-watched effort to produce a national privacy law is a working group with six members of the Senate Commerce Committee, traditionally a leader on internet issues.

  • Members of the group had indicated that they hoped to have produced a proposal by Memorial Day, sources said.
  • That milestone has now come and gone — although the group has added influential members, a possible sign of progress — with multiple sources telling Axios they expect to see a draft proposal this summer.

A person familiar with the committee’s efforts said the group was aiming to reach a bipartisan consensus, and has been meeting with outside parties.

  • Aides involved in the working group have been asking about how to tailor the rules so they don’t hamper small businesses, according to two sources. (Europe's rules have been criticized by industry for placing too much of a burden on startups.)
  • Senators have been mum about the sticking points in their discussions — but Democrats have long said that they'll only be willing to preempt states in exchange for substantial concessions from the industry.

The big picture: Other lawmakers have also failed to produce privacy proposals.

  • The Senate Judiciary Committee sent letters earlier this year to companies asking about their data collection practices, according to a source. But there's no indication of plans to move forward with a specific bill.
  • Democrats had signaled privacy legislation would be a priority when they retook the House last year. But major House committees haven’t moved forward with a bill, either, and Speaker Nancy Pelosi (D) has indicated she’s wary of overriding state rules like those soon to take effect in her home state of California.

Yes, but: The process could be jolted by a resolution of the Federal Trade Commission's investigation of Facebook.

The bottom line: Reaching consensus on bipartisan legislation is historically more difficult in an election year, so policymakers intent on crafting a stricter standard for the likes of Google and Facebook are running out of time.