People generally only care about securing their data and ensuring their own privacy as far as it is convenient to do so. According to A Large-Scale Study of Web Password Habits published by Microsoft Research in 2007, "Users choose passwords with an average bitstrength of 40.54 bits. The overwhelming majority of users choose passwords that contain lower case letters only (i.e. no uppercase, digits, or special characters)."
The "nothing-to-hide" argument is invalid. Just because one has nothing to hide does not necessarily mean that one has nothing to show. "Having nothing to hide" is equivalent to saying "having nothing one would not be willing to show," which means one is totally comfortable with the potentiality of identity theft that comes with a lack of security. Identity theft notwithstanding, one also needs space in order to think and develop one's identity.
Security is a tradeoff between convenience and privacy.
http://research.microsoft.com/pubs/74164/www2007.pdf
http://www.techhive.com/article/226785/encrypt_your_hard_drives.html
http://www.wired.com/gadgetlab/2012/11/ff-mat-honan-password-hacker/all/
Kravats, D. (2013, April 23). Here's a Good Reason to Encrypt Your Data | Threat Level | Wired.com. Retrieved from http://www.wired.com/threatlevel/2013/04/encrypt-your-data/
Nice little post regarding security. The last sentence which states, "Security is a tradeoff between convenience and privacy," is completely true. On many highly secured programs, there are many barriers navigating between pages. This may seem tedious, but it provides the security and the authorization for the user. You bring up a valid and arguable point when you mention the phrase "nothing to hide." However, it would be great if you can clarify the correlation between hiding information and identity theft.
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