The fundamental problem here isn't the data loss (other than a possible loss of privacy), but one of what someone other than the authorized owner of that information can do with it. Credit reporting agencies, property title offices, passport offices, and a whole host of other people need a much stronger form of authentication. These fools have ignored this problem for years, and impose costs not only on the victims but on everyone else due to prosecution, police investigation, etc..

From a practical security perspective, security on data use is really limited to the "something you have" aspect (i.e. your name/SSN/DoB/address), less on the "something you know" and rarely the "something you are" categories. Both government and private industry needs to wake up and start making it much more difficult for people to have anything bad done to them simply because someone uses their data ON TOP of mandating cryptography and security for information (which I deem to be separate concepts).

An idea - digitally sign the hash of a person's fingerprint, retina, signature and a non-obvious PIN (i.e. pictures, phrases, numbers, questions), put the root certificate authority in a government-controlled secure bunker or military base with FIPS 140 secured HSMs and multiple independent layered checks and balances, and use the signature/verification chain for both government and commercial uses.