My 2000 Article: The Rise of the Surveillance State

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 Interact, 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 “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 harrumphed: “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.’”

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 oped, 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.