May, 2000

HEADLINE: Rise of the Surveillance State
High-tech whets all the wrong government appetites.

BYLINE: James Bovard; James Bovard is the author of Freedom in Chains: The
Rise of the State & the Demise of the Citizen (St. Martin's Press).

BODY:

While high-tech breakthroughs make business more productive and life more
pleasant, progress also has a dark side. Technology designed for benign purposes
can be used for ill ones too. The Clinton administration has led the way, acting
as if every new computer and telephone should have a welcome mat for federal
wiretappers. A 1998 American Civil Liberties Union report noted, " The
Administration is using scare tactics to acquire vast new powers to spy on all
Americans."

On April 16, 1993, the White House revealed that the National Security Agency
had secretly developed a new microchip known as the Clipper Chip. The press
release called it "a new initiative that will bring the Federal Government
together with industry in a voluntary program to improve the security and
privacy of telephone communications while meeting the legitimate needs of law
enforcement." This was practically the last time that the word " voluntary" was
mentioned.

The Clipper Chip's developers presumed it should be a crime for anyone to use
technology--such as encryption--that frustrates government agents. Encryption
software allows individuals to send messages between computers that cannot be
read by third parties. It is vital to prevent fraud or abuse of financial
transactions and is widely used both here and abroad. Encryption has a long
history--Thomas Jefferson used secret codes in his correspondence to avoid
detection by the British.

"The Clipper Chip proposal would have required every encryption user (that
is, every individual or business using a digital telephone system, fax machine,
the Internet, etc.) to hand over their decryption keys to the government,
giving it access to both stored data and real-time communications, " the ACLU
noted. Marc Rotenberg, director of the Electronic Privacy Information Center,
observed: "You don't want to buy a set of car keys from a guy who specializes in
stealing cars." When the federal National Institute of Standards and Technology
formally published the proposal for the new surveillance chip, fewer than one
percent of the comments received from the public supported the Clipper Chip
plan.

Although it eventually abandoned its effort to impose the Clipper Chip, the
administration did not give up on trying to tap the nation's telephones. In 1994
it railroaded through Congress a law to dumb down phone technology in order to
facilitate government wiretapping. On October 16, 1995, the telecommunications
industry was stunned when a Federal Register notice appeared announcing that the
FBI was demanding that phone companies provide the capability for simultaneous
wiretaps of one out of every hundred phone calls in urban areas. The FBI notice
represented "a 1,000-fold increase over previous levels of surveillance." FBI
Director Louis Freeh denied that any expansion of wiretapping was planned.

The 1994 Communications Assistance for Law Enforcement law led to five years
of clashes between the FBI and the communications industry over the new
standards. The Federal Communications Commission was the bill's designated
arbiter; in August 1999, the FCC caved and gave the FBI almost everything it
wanted. The FCC ordered that all new cellular telephones become de facto homing
devices for law enforcement by including components which enable law enforcement
to determine the precise location from which a person is calling. As Electronic
Design magazine noted, "Unlike the location feature being created for 911
emergency services, this capability will apply to all calls and users won't be
able to turn it off." Attorney General Janet Reno hailed the decision: "The
continuing technological changes in the nation's telecommunications systems
present increasing challenges to law enforcement. This ruling will enable law
enforcement to keep pace with these changes." The New York Times noted,
"Law-enforcement officials have asserted that since the location of wired
telephones is already public information, there is no intrusion of privacy in
determining the location of wireless phones." This is like saying that since
police can determine a person's home addresses by checking the phone book, it is
no violation of privacy to let police follow the person around every place he
goes once he leaves his house.

In addition to telephones, the security of computer software and the Internet
have also been targeted. The administration spent three years hounding Phil
Zimmerman, the inventor of Pretty Good Privacy, software designed to protect
computer data and messages from surveillance. Someone placed PGP on an Internet
site, thus making it available free to anyone in the world who chose to download
it. For this the feds threatened Zimmerman with a five-year prison sentence
and a million-dollar fine for exporting " munitions." Noted Zimmerman in a 1999
interview: "In a number of countries with oppressive regimes, PGP is the only
weapon that humanitarian aid workers have to prevent hostile dictatorships from
monitoring their communications."

Last August the Justice Department submitted the Cyberspace Electronic
Security Act to Congress. The bill would make it easier for government to
intrude on private communications by allowing law enforcement to obtain search
warrants "to secretly enter suspects' homes or offices and disable security on
personal computers as a prelude to a wiretap or further search." Average
Americans would face to "black bag jobs" previously restricted to espionage or
national security cases. Janet Reno justified the new powers thus: "When
criminals like drug dealers and terrorists use encryption to conceal their
communications, law enforcement must be able to respond in a manner that will
not thwart an investigation or tip off a suspect." But such searches pose
special dangers because of the opportunities for government agents to tamper
with evidence while manipulating software on a target's computer.

In October 1999, members of the international Internet Engineering Task Force
revealed that the FBI was pressuring them to create a "surveillance- friendly"
architecture for Internet communications. The Bureau wanted the Task Force to
build "trapdoors" into e-mail communications programs to allow law enforcement
easy access to supposedly confidential messages. Several high- tech experts
publicly warned: "We believe that such a development would harm network
security, result in more illegal activities, diminish users' privacy, stifle
innovation, and impose significant costs on developers of communications." The
ACLU's Barry Steinhardt said, "What law enforcement is asking...is the
equivalent of requiring the home building industry to place a 'secret' door in
all new homes to which only it would have the key." Although the task force
managed to rebuff the pressure, the fact the FBI even attempted to have software
engineers sacrifice e-mail reliability for the sake of government intrusions is
a warning as to how audacious the feds have become.

Last fall news broke about the existence of Echelon, a spy satellite system run
by the National Security Agency along with the United Kingdom, Australia, New
Zealand, and Canada. Echelon reportedly scans millions of phone calls, e-mail
messages, and faxes each hour, searching for key words. The European Union and
the governments of Italy and Russia loudly protested Echelon's intrusions into
their sovereign domains. European Parliament Speaker Nicole Fontaine harumphed:
''We have every reason to be shocked at the fact that this form of espionage,
which has been going on for a number of years, has not prompted any official
protest.'' One Portuguese paper complained that Echelon is "like a technological
nightmare extracted from the crazy conspiracy theories of 'The X-Files.'''
The American Spectator, May, 2000 May, 2000

Rep. Bob Barr, a former CIA employee and the most vigilant congressman
regarding federal high-tech intrusions, attached a rider to an appropriations
bill last year that required the NSA and the CIA to report to Congress on the
standards Echelon used to tap Americans' communications. In a February letter,
the NSA assured members of Congress that "the NSA's activities are conducted in
accordance with the highest constitutional, legal and ethical standards, and in
compliance with statutes and regulations designed to protect the privacy rights
of U.S. persons.'' Even as it professed it would never act unconstitutionally,
the NSA sought to block further House inquiries into Echelon's operations.

A February report by the European Union alleged that Echelon has been used
for economic espionage. Former CIA Director James Woolsey told a German
newspaper in early March that Echelon collects "economic intelligence." One
example Woolsey gave was espionage aimed at discovering when foreign companies
are paying bribes to obtain contracts that might otherwise go to American
companies. Woolsey elaborated on his views in a condescending March 17 Wall
Street Journal op-ed, justifying Echelon spying on foreign companies because
some foreigners do not obey the U.S. Foreign Corrupt Practices Act. To add
insult to injury, Woolsey noted there's no reason for U.S. companies to steal
backward Europe's secrets.

The most egregious examples of governmental invasion of privacy relate to two
of the most intimate areas in life--your money and your body. In September 1999,
Marvin Goodfriend, a senior vice president at the Federal Reserve Bank of
Richmond, proposed that government use new technology to penalize citizens who
do not spend their cash as fast as government wanted. " The magnetic strip (in
new U.S. currency) could visibly record when a bill was last withdrawn from the
banking system. A carry tax could be deducted from each bill upon deposit
according to how long the bill was in circulation. " Wired News noted that a
federal "carry tax" would "discourage 'hoarding' currency, deter black market
and criminal activities, and boost economic stability during deflationary
periods when interest rates hover near zero." Rep. Ron Paul, a member of the
House Banking Committee, denounced the proposal: "The whole idea is
preposterous. The notion that we're going to tax somebody because they decide to
be frugal and hold a couple of dollars is economic planning at its worst."

Lastly, the Customs Service recently began deploying BodySearch equipment
that allows Customs inspectors to see through the clothes of designated lucky
travelers. The ACLU's Gregory Nojeim warned that the new body scanners could
show "underneath clothing and with clarity, breasts or a penis, and the relative
dimensions of each. The system has a joystick-driven zoom option that allows the
operator to enlarge portions of the image." Customs spokesman Dennis Murphy
explained: "What (BodySearch) does is alleviate the need for us to touch
people, because people don't like to be touched, and we don't blame them,
because our inspectors also feel uncomfortable touching people." The BodySearch
system has a feature that can potentially violate travelers more than a pat-down
from a Customs agent: the capacity to save images of what it views. Travelers
can now look forward to a new kind of trip souvenir: a picture of their privates
on file at a federal agency.