The Hidden Cost of Privacy?

Forbes has an interesting article on The Hidden Cost of Privacy which suggests that the costs of complying with privacy laws outweigh the benefits gained. Bruce Schneier has a good counterpoint here: The "hidden cost" of privacy and suggests the following points:

1. Broad privacy regulations are better than narrow ones.
2. Simple and clear regulations are better than complex and confusing ones.
3. It's far better to regulate results than methodology.
4. Penalties for bad behavior need to be expensive enough to make good behavior the rational choice.