• Opinion
  • December 7, 2018
  • 6 minutes
  • 1

e-ID saves Estonia 2% of GDP a year. It’s time America caught up

Opinion: e-IDs offer opportunities for public agencies to better deliver and develop e-services

e-ID

This opinion piece was written by Joel Burke. The thoughts and opinions expressed here are his personal ones and not the Government of Estonia’s. 


In 2017, identity theft cost Americans $16.8 billion, and, in just one data breach, over 140 million Americans had their social security numbers exposed publicly, highlighting a fatal flaw in the way we identify citizens.

The only universal federal method of identification and the underpinning of state-level identification systems and social security numbers/identification have barely changed since the 1930s. What started as a worker identification tool with a paper card issued for life expanded to encompass everything around identity for banking, taxation and much more.

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This makes an individual’s social security number an especially ripe target for malicious actors, and industry estimates 60–80% of numbers as having been compromised.

Moving to an electronic identification system where every citizen is issued a digitally-enabled federal identity card that is connected to a federal database and eliminating the current social security identity protocol would serve to mitigate a major security threat to Americans.

This includes both those who have already had their data exposed and those who haven’t, while also serving as a cornerstone for developing e-solutions that can be built off of the basis of e-IDs and digital identity, and as a tool for aligning all the states with varying identity protocols under one unified system — all with major positive fiscal ramifications.

Similar initiatives by foreign governments have resulted in massive increases in efficiency and cost savings

This is also a potential fix for the slow-moving Real ID Act, which was enacted in 2005, but still has yet to be implemented in several states. That currently leaves around 45 million Americans with state level identification that does not reach minimum federal standards for things like a flight document to board an airplane.

e-IDs offer opportunities for government agencies to better deliver and develop e-services like online tax declarations and online management of vehicles and IDs, with citizens securely identifiable in a standardised way across the country. It allows the combining of these systems at the state and federal level to create much higher efficiencies and cost savings for both holders of cards and the government.

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Similar initiatives by foreign governments have resulted in massive increases in efficiency and cost savings.  The Estonian government estimates its e-Estonia systems contributes ~2% GDP per year in savings (2% of US 2017 GDP would be over $300 billion) and dramatically increases citizen engagement, with one of the highest rates of tax payments worldwide.

e-ID solutions also allow for better internal tracking for expenditures, helping to counter the current $100+ billion improper government payments made each year in the US, according to a 2015 Government Accountability Office estimate.

Current systems are inefficient, insecure and non-standardised

Today, the US government is at a crossroads regarding the management of citizen identities. Current systems are inefficient, insecure and non-standardised, leaving us vulnerable and with fewer opportunities for building more efficient e-government systems. Issuing a single standardised e-ID card to every American would eliminate massive security risks, standardise citizen identification and open a myriad of opportunities for creating a more efficient government.

If you are interested in learning more about real case studies for how e-IDs have been successfully implemented throughout the world, Gemalto (one of the largest creators of e-IDs and identity solutions) is a good place to start. Their case study on the implementation of e-IDs in Belgium is especially informative.

For more on how Estonia became a pioneer in digital, The New Yorker had a great piece, Estonia, The Digital Republic, in their December 2017 issue. For more on the private companies like Nortal and Guardtime whose work helped make many e-government systems possible and e-IDs useful, take a look at e-estonia’s solutions page.

If you’re a government employee and looking for help or insight, please also feel free to contact me via my Apolitical profile and I will do my best to point you in the right direction. — Joel Burke

(Picture credit: Unsplash)

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