Taxation Chicanary

/ Politics

The apportionment of taxes on the various descriptions of property is an act which seems to require the most exact impartiality; yet there is, perhaps, no legislative act in which greater opportunity and temptation are given to a predominant party to trample on the rules of justice. — James Madison

Tax policy has everything a politician could want in an issue: it affects everyone, it’s easy to differentiate your position from your opponent’s, and it’s complex enough that you can spin the subject six ways to Sunday without ever telling a bald-faced lie. With the presidential campaign ramping up and the California gubernatorial campaign in full swing I’m starting to see a few standard tricks get used. I’m no Penn and Teller of the political world, but I thought I’d list some of the spin tricks I’ve seen so far. (Kids, play at home — how many misleading tax claims can you find this campaign season?)

  1. Bringing down the (income) tax. In 2001, President Bush said that under his first tax cut “a family of four making $35,000 [would] receive a one hundred percent tax cut.” What he forgot to mention that this was only income tax he was talking about, not payroll tax.

    Everyone gets mad about income tax because it’s the one we see every April, but 74% of Americans actually pay more in federal payroll tax than federal income tax. For poor to moderate-income workers, it’s a lot more. And because income taxes are a relatively small percentage of these worker’s total tax burden, any small reduction can look like a huge percentage of the income tax without reducing the total tax burden by a large amount. It’s a classic use of misdirection. Penn and Teller would be proud.

    This trick hasn’t been retired in the past two years, either. Back in June of this year, Tim Russert quoted statistics provided by the Department of Treasury in his Meet The Press interview with Howard Dean:

    The Department of Treasury, we consulted and asked them: What effect would [repealing Bush’s entire package of tax cuts] have across America? And this is what they said. A married couple with two children making $40,000 a year, under the Bush plan, would pay $45 in taxes. Repealing them, under the Dean plan, if you will, would pay $1,978, a tax increase of over 4,000 percent. A married couple over 65 making $40,000 and claiming their Social Security, under Bush would pay $675 in taxes. You’re suggesting close to $1,400, a 107 percent tax increase. Can you honestly go across the country and say, “I’m going to raise your taxes 4,000 percent or 107 percent,” and be elected?

    Dean responded “I don’t believe [those figures]. This administration has not been candid about the impacts of this tax cut.”

    John Kerry continues to cite these numbers, saying in an August 31st Meet The Press that “If you’re a $40,000 income earner, Howard Dean’s going to raise your taxes more than 20 times.”

    As you might have guessed, the numbers provided to NBC for the Dean interview are only for income tax, not the full tax burden. Martin Sullivan, an economist and writer for Tax Notes, discussed the figures in a recent article:

    And in a new application of the “income tax only” approach to distribution analysis, the Treasury Department is providing the press with case studies of the combined effects of the 2002 and 2003 tax cuts on middle-income families. But in what can only be characterized as egregious use of misinformation, the Treasury Department frequently omits from its explanation that it is looking only at income taxes.

    He then discusses the Treasury Department report that was quoted in the Dean interview, noting that the words “income tax” appear only in the detailed write-up and an accompanying report, but nowhere in the main executive summary. “If this continues,” writes Sullivan, “the Treasury’s Office of Tax Policy (OTP) may have to change its name to the Office of Tax Propaganda.”

  2. Just your average family. The most common way to compute an average tax-cut is to take the total tax cut and divide by the number of tax-payers (also known as the mean). So when Bush says “ninety-two million Americans will keep, this year, an average of almost $1,000 more of their own money” in his State of the Union address, that’s the average of my tax cut, your tax cut, and Bill Gates’ tax cut. Unfortunately, Bill Gates got a bigger cut than you or I did, so that skews the numbers. It also doesn’t average in the fifty million tax-paying Americans who got no tax cut, which brings the average up even further. In fact, according to the Urban-Brookings Tax Policy Center, fewer than 20% of tax-payers would receive a tax cut of $1000 or more. A less misleading average would be the median tax cut (a little less than $100) or the mode tax cut (zero dollars) but those don’t sound nearly as exciting.

  3. The Specter of Double Taxation. The dividend tax has been loudly criticized as being an “unfair double taxation.” To quote the Republican Study Committee:

    No dollar should be taxed twice — especially not a dollar created by citizen productivity. Just imagine if taxes were taken out of your constituents’ weekly paychecks before they were mailed and then again after they were mailed. Wouldn’t that be unfair? The double taxation of dividends is equally unjust. No income should be taxed more than once. If the federal government taxes a dollar of corporate profit, it has no right to tax that same dollar again just because it is distributed to shareholders.

    There are sound economic arguments for reducing the dividend tax, the strongest being that it encourages companies to issue stock instead of borrow money. However, the double-taxation argument is complete chicanery — all money is double-taxed (and triple-taxed, and quadruple-taxed). When I receive my paycheck (created with my citizen productivity), I pay income tax. I then spend that money and pay sales tax, a double-tax. If I purchase gasoline I’ll also pay a gas tax, a triple-tax on my dollar. But it doesn’t stop there! The gas station uses that dollar to pay the attendant, and charge him income tax, and then he goes to a restaurant… you get the idea. There’s a nice Tom The Dancing Bug cartoon that illustrates the problems with this dodge quite effectively.

  4. What goes around comes around. During the first California Gubernatorial recall debate, Arianna Huffington (Independent) and Peter Camejo (Green) both suggested raising corporate taxes. On the surface this sounds like a way to raise revenue without causing pain to working-class voters, but it ignores the fact that everything is interconnected in an economy. Republican State Senator Tom McClintock had this response:

    I’ll let you in on a secret about business taxes. Businesses do not pay taxes, they pay taxes through you as a consumer in higher prices, through you as an employee through lower wages or through you as an investor in lower earnings. Investors are not fat cats, that is Mom and Dad’s retirement fund we’re talking about.

    McClintock is correct as far as he goes: at some point that tax burden has to be paid by real humans, be they consumers, employees or investors. But he only describes half the cycle. The other half is that taxes on individual people will come back to be paid by businesses, through lower sales to consumers, higher wages of employees, or through lower stock prices as investors have less savings to invest. That’s the whole point of both trickle-down and trickle-up economics: to get business moving, you give a tax break to consumers and investors. In economics, everything is connected. You can’t just look at the burden on one group without looking at how it affects the whole.

  5. Math class is hard. Let’s go shopping. One of the arguments that gets used to promote flat taxes and consumption taxes goes something like this: “Boy, tax forms are complicated, aren’t they? If you’d just throw out the entire income tax system and replace it with our proposal you wouldn’t have to do all that math every April.” To quote the main tagline of Americans for Fair Taxation, “It’s simple.”

    I’m amazed that anyone falls for this argument. First of all, the tax code isn’t complex because we have a graduated (that is, non-flat) income tax, it’s complicated because of all the exemptions, deductions, and special cases. (Such exemptions are used, for example, to encourage home ownership by allowing mortgage interest to be deducted from one’s income.) Second, both flat-taxes and consumption-taxes are extremely regressive, which is to say they tax the poor a larger percentage of their income than they do the rich. I guess the idea is to distract middle-class voters with the simplicity argument so they don’t realize they’ll be taking on a larger tax burden. Pay no attention to the man behind the curtain.

In the end, tax policy boils down to just three things: fairly distributing the tax burden, creating incentives for useful behavior, and making sure there’s enough revenue to keep the government running. Between these three parameters there’s a whole world of complex, intelligent argument. We need advocates who can argue about whether a tax is more fair when it burdens everyone equally, burdens each according to his means, or burdens each according to the benefit he receives. We need economists who can argue whether trickle-up or trickle-down will jump-start an economy faster. We need political representatives who can argue about what services the government should provide. These are good, honest, and necessary arguments. We have no need for deceivers, dissemblers and charlatans who hope to pull a fast one.

References

Taxation Chicanary Read More »

Webmaster to start one-year sentence

/ Big Brother

Sherman Austin headed to jail on Wednesday to start his one-year prison sentence, guilty of hosting plans for the manufacture of explosives on his anarchist website, RaiseTheFist.com. The plans were not written by Austin, but Austin provided free hosting for anarchists and political protesters. In January of 2002, the FBI raided the home where Austin lived with his parents and confiscated all his computers and backup disks, including the server for RaiseTheFist. Agents also found components to make a Molotov cocktail. Austin was 18 years old at the time. (Austin details the entire story in an interview with CounterPunch.)

A few days later Austin went to the World Economic Forum protest in New York, where he was arrested and held without bail. He was eventually charged with possession of an unregistered firearm (the Molotov cocktail components), and with violating the controversial 1997 federal law that makes it illegal to distribute information about the manufacture of explosives “with the intent that the… information be used for, or in furtherance of, an activity that constitutes a Federal crime of violence.” The law, championed by Sen. Dianne Feinstein (D-Calif.), raised serious first amendment issues when it was proposed. According to a CNET interview with Austin shortly before he went to prison, he is the first person to be convicted under the law.

In a statement on his web site, Austin said he originally planned to contest the charges. He decided to plead guilty to the information dissemination crime in return for the dropping of the firearms charge, because “after my lawyer consulted the USPO working on the case, she found out that a ‘terrorism enhancement’ is applicable to my charge, which could get me an additional 20 years.” According to the LA Times, Austin was offered a plea bargain of four months in prison followed by four months in a halfway house, but U.S. District Judge Stephen V. Wilson rejected the plea and sentenced Austin to a full year in prison. After completing his term, he will be placed on three years probation, and will be barred from associating with any groups that espouse violence to achieve political, economic or social change. He will also need permission from the probation office operate a computer. The EFF has protested that the sentence is too severe for the alleged crime.

Several things bother me about this case.

First are the obvious First Amendment issues with the anti-information law under which he was convicted. Two things are necessary for this law to apply. The first is the distribution of information about explosives, which is clearly pure speech that is protected under the First Amendment. The second is the intent that the information be used for a violent crime, which is inherently difficult to prove or to disprove. It seems quite reasonable that Austin was all bluster and no action, an angry 18-year-old boy who liked to play political terrorist on his website and in his back yard but was not violent in real life. It is telling that the only previous charges brought against Austin were for refusal to disperse, conspiracy to commit a refusal to disperse, unlawful assembly, and disorderly conduct for blocking pedestrian traffic. In other words, for committing peaceful civil disobedience.

It’s not surprising that the FBI thought they were dealing with a dangerous terrorist psychopathic when they went to RaiseTheFist.com and saw pictures of George W. Bush with a gun sight on his head, or read posts saying “Yeah, motherfucker, I’m a terrorist to the United States Government. I’m a terrorist to capitalism.” and “We don’t gather weapons, plan extreme operation, and risk our lives for nothing. This is real.” But that’s just speech, not action. It’s like the old Saturday Night Live running gag where someone says “Well, it’s not like I said I was going to kill the president…” and gets jumped by Secret Service agents that come out of nowhere. It’s also not clear to me whether Austin was the author of any of these more violent postings, or whether he merely hosted them.

The second bothersome point is that the this smacks of selective enforcement. Information on how to make bombs is everywhere, from libraries to web sites to bookstores. This includes the infamous Anarchist’s Cookbook that was published in 1970, and about which the author admits that the “central idea to the book was that violence is an acceptable means to bring about political change.” And yet, the FBI has yet to raid Amazon.com to stop them from distributing this information. Of course, Amazon was not the author of the book, and it would be unfair to assume that Amazon intends violence just because they sell a violent book. Just as Austin did not write the explosives guide, and it is unfair to assume he intends any violence just because he offers web hosting for a violent page. Clearly, the crackdown was at least in part due to RaiseTheFist’s message, and the fact that this message was in alignment with the growing anti-globalization movement.

The final point is most troubling: Austin was never able to argue his case. Plea bargains are meant to be an incentive to surrender when guilt is obvious. In cases like Austin’s, where the plea is for a four-month sentence and the risk is 20+ years, there is huge incentive for a suspect to plead guilty even when he knows he is innocent. Sadly, this is often the rule rather than the exception, especially for the poor. It is only because this case involves mediapathic issues such as First-Amendment rights, the Internet, and terrorism that we have heard about it at all, unlike the hundreds of cases every day where innocent men and women cop a plea to go free based on time served rather than risk further jail time to clear their names.

Austin’s lawyer describes his client as “a very peaceful person” who got carried away “in a very heated political environment.” A clinical psychologist who specializes in threat assessments wrote for the defense that Austin “does not appear to have seriously considered the ramifications” of his actions “and would have been horrified had someone been injured.” Let us hope that his year in prison, and his apparent abuse by the system, does not turn this peaceful-but-angry young man into the very terror the FBI fears.

References

Webmaster to start one-year sentence Read More »

Root Kit. Password Sniffer. Subpoena?

/ Uncategorized

Hackers have just had a new tool added to their arsenal of ways to get unauthorized access to a computer: the overbroad subpoena.

The story starts with Alwyn Farey-Jones, who was embroiled in a commercial lawsuit with a company called Integrated Capital Associates (ICA). In the course of that suit he told his lawyer to subpoena ICA’s internet service provider, NetGate, for ICA’s email. All of it.

What NetGate should have done is pass the subpoena by a lawyer, or at the very least talk to ICA first. But apparently they were cowed by the legal saber-rattling and eventually put up a “free sample” of 339 messages from ICA on their website for Farey-Jones and his lawyer to download. Most were unrelated to the litigation, and many were privileged or personal. Farey-Jones and his lawyer read them without notifying opposing council. After ICA’s lawyers found out what had happened, the court issued a major tongue-lashing, quashed the subpoena and fined Farey-Jones over $9000 to cover ICA’s legal fees. The court found “the subpoena, on its face, was massively overbroad” and “patently unlawful,” that it “transparently and egregiously” violated the Federal Rules, and that defendants “acted in bad faith” and showed “at least gross negligence in the crafting of the subpoena.” Subpoenas can be issued without a judge’s approval, but under the Federal Rules lawyers must “take reasonable steps to avoid imposing undue burden or expense.”

This is where things get interesting. ICA’s lawyers and ICA employees whose e-mail was made available sued Farey-Jones and his lawyer for violating the Stored Communications Act and the Computer Fraud and Abuse Act, among others. These acts are usually applied to hackers who crack into a computer. In particular, the Stored Communications Act provides a cause of action against anyone who “intentionally accesses without authorization a facility through which an electronic communication service is provided… and thereby obtains, alters, or prevents authorized access to a wire or electronic communication while it is in electronic storage.” The Computer Fraud and Abuse Act reads similarly with regard to accessing “information from any protected computer.” The district court threw the case out, but on appeal the 9th Circuit ruled that these laws can, in fact, apply to overly broad subpoenas. The case now goes back for trial.

From my non-lawyer’s perspective, the court’s logic makes sense. Farey-Jones and his lawyer used deception (in this case, a subpoena they knew to be illegally broad) to gain access to information from a computer. This sounds a lot like the so-called “social engineering” used by Kevin Mitnick to gain network access and sensitive information. As Mitnick said in a recent interview, “social engineering… is basically using manipulation or deception to influence a person to comply with a request — to release sensitive information or perform an action that creates a security hole, such as typing in commands, installing software or turning on a modem.” Or in this case, to get an ISP to post email archives on their website where they can be downloaded.

SecurityFocus reports that legal reactions to the ruling are mixed. On the one hand, experts were concerned that it expands the scope of computer crime to include people who never themselves access a computer, and allows people who don’t even own the computer in question to bring suit. On the other hand, experts said the ruling is good for online privacy and cracks down on subpoena-aided fishing expeditions. Cindy Cohn, legal director at the Electronic Frontier Foundation, said the EFF plans to cite the case in arguments against the Recording Industry Association of America, which has been subpoenaing ISPs to identify file traders. “It’s going to be pretty useful to us,” Cohn told SecurityFocus. “It buttresses the idea that you have a serious level of responsibility in issuing these legal instruments.”

References

Root Kit. Password Sniffer. Subpoena? Read More »

Lies: A Fair and Balanced Review

/ Politics

About a year ago I put myself on a no-caffeine, no-Chomsky diet. I know there are a lot of people out there who read Chomsky’s political writings and get all upset because they think it’s nothing but a pack of lies. I’m not one of those people. By the time I finish reading Chomsky I’m upset because I believe most of what he writes, and what he writes is depressing as all get-out. Chomsky has this way of saying something outlandish like “we should not forget that the U.S. itself is a leading terrorist state.” He then goes on for pages citing relevant newspaper articles, U.N. Resolutions, Senate testimony and U.S. policy documents to back up his claims. Being a linguist, he also doesn’t have the decency to bend the meaning of words so things like “terrorism” can apply when the bad guys do it but not when we do it.

After I went on my diet I became much calmer and happier. In my mind, the word chomsky became an adjective that described a whole class of media, not just those written by Chomsky himself. I started using the word to mean anything that lays out rational arguments that lead to depressing conclusions about the world. My media diet became stricter as I cut out Fairness and Accuracy In Reporting, The Daily Howler, The Center for Media & Democracy and sometimes even The Economist. (While chomsky can be of any political leaning, I don’t include people like Ann Coulter, Rush Limbaugh, Bill O’Reilly or Michael Moore because they’re more about appeals to emotion than rational argument — that’s a different class I call world wrestling federation.)

Now Al Franken has released a new book, Lies And The Lying Liars Who Tell Them: A Fair and Balanced Look at the Right. The title alone reeks of chomsky, and so my natural instinct was to curl up with my latest copy of IEEE Spectrum Magazine until it went away. But then Fox News sued Franken for using the words “Fair and Balanced” in his title. Their lawsuit, which was quickly thrown out, accused Franken as an “unstable” and “shrill” “C-level commentator” who is “not a well-respected voice in American politics.” With an endorsement like that, how could I resist?

The first thing I note is that professional comics like Franken are much funnier than linguists. (He’s also a lot lighter on the endnotes: this is beach reading, not an academic journal.) Some of the gags are gentle ribbing, like this passage from his section on the environment:

Perhaps there is someone reading this who is saying, “Give me a break, Al. I don’t care about the environment.” To you, I have this to say: You were not legitimately elected president, sir. But I respect the office you hold, and I’m honored that you’re reading my book.

Other jokes are much more barbed, and will no doubt cause much consternation among the more thin-skinned conservatives. Especially harsh are “The Gospel of Supply Side Jesus” comic, drawn in the style of Chick Bible Tracts, and “Operation Chickenhawk,” a short story with right-wing draft-dodgers like Bush, Cheney and Limbaugh fighting in an Apocalypse Now setting. Franken can be quite venomous when he wants to be, but he seems to have an unwritten rule that he’ll only dish out as much venom as the victim deserves. Ann Coulter and Bill O’Reilly, venom-slingers in their own right, get both barrels. But in the chapter on how he toured Bob Jones University on false pretenses, Franken is actually apologetic and, in retrospect, ashamed of fooling “people who were welcoming, friendly, and extremely nice.” He also has compliments for right-wingers that he feels are honest and worthy of respect, several of whom he considers friends.

Underneath the humor, the book is still pure chomsky. He starts by taking on Ann Coulter, an easy task by any measure. Coulter’s misquotes and downright lies are well documented, and Franken does a quick job of it. (Quoting a friend of his: “I’ve never shot fish in a barrel. But I could imagine that after a while it could get boring.”) He then moves on to Bernie Goldberg (author of Bias), the 2000 election, Fox News, and the Bush Administration, as well as a very touching chapter on the Paul Wellstone memorial. Treatment ranges from point-by-point dissection of specific right-wing lies to anecdotes of the times he’s met with (and often baited) the celebrities of right-wing politics.

Through the book, Franken tries to explain the way the liars operate, and perhaps help us understand why. This is where it gets depressing. Start with slander, false quotes, out-of-context clips, and misleading figures and data. Throw in dirty tricks like push-polling. Finish with a cadre of talk-show hosts, journalists and media personalities ready and able to do your dirty work, and a mainstream press all too willing to go with the juicy, the sensational, and the easy. As for why, just look around you today. Bush has the White House, a firm grip on both houses of Congress, and has a stated priority to stack the Judicial branch. Republicans who disagree with the president’s policies have been marginalized. The Democrats are in disarray, and the White House Press Corp is intimidated.

It all makes me furious, which is why I went on the no-caffeine, no-chomsky diet in the first place. I keep hoping that if I just stick to real issues these sleaze-balls will go away. But of course they won’t, and they’re too powerful to ignore. A healthy society needs vigorous, passionate debate. What we have now is the opposite: a guerilla warfare of ideas, where rational discussion gets shot down by snipers in the trees. On its own, Franken’s book is no grand call to arms, but it joins an increasing number of chomsky that are shouting out from all sides of the political aisle. Together, they are a call to defend our democracy from corruption. To quote Franken’s closing message:

We have to fight back. But we can’t fight like they do. The Right’s entertainment value comes from their willingness to lie and distort. Ours will have to come from being funny and attractive. And passionate. And idealistic. But also smart. And not milquetoast-y. We’ve got to be willing to throw their lies in their face.

I don’t think I can just pick up my IEEE Spectrum Magazine and forget it all again.

References

Lies: A Fair and Balanced Review Read More »

Diamonds are forever

/ Uncategorized

This month’s Wired Magazine cover story, “The New Diamond Age” is quite a read, merging Wired’s standard breathless technology-is-changing-everything fare with James Bond-style meetings and secret labs complete with Russian scientists. At the root of the story are two labs that make synthetic diamonds. These aren’t simulated gemstones like Cubic Zirconia (CZ) but real diamond gemstones that have been created in the laboratory rather than mined from the Earth. Gemesis, based in Florida, uses high pressure and temperature chambers that mimic how diamonds are created in the Earth. Apollo Diamond, based near Boston, uses chemical vapor deposition to grow diamonds. These labs, Wired hints, might just bankrupt the diamond industry.

To those within the jewelry industry, however, synthetic diamonds are business-as-usual. Gemesis and now synthetic gemstone-maker Chatham have been producing synthetic diamonds for several years, and the process was even the subject of a Nova back in 2000. Apollo’s technique has produced some recent advances, but to hear Jeweler’s Circular Keystone report it this is all just steady technological progress. It would seem the only important point to jewelers is whether gemologists can scientifically distinguish synthetics from natural gemstones, not whether the synthetics are “as good as” diamonds in any other way. And according to the Gemological Institute of America (GIA), it is fairly straightforward to identify even the new Apollo diamonds. They also note that Apollo is working with the GIA “to ensure that these CVD laboratory-grown diamonds are correctly identified before being introduced into the market.”

The key is that the price of diamonds, and gemstones in general, are governed by the laws of fashion rather than some objective standard. Certainly diamonds are pretty, but then so is Cubic Zirconia. There are two things that keep diamonds in high demand over substitutes like CZ. First, the De Beers cartel goes to great lengths to remind us that the only way for a man to prove his love to a woman is by giving her diamonds, and you can bet that De Beers won’t let synthetics in on that little bit of spin. As Jef Van Royen, a senior scientist at the Diamond High Council put it to Wired: “If people really love each other, then they give each other the real stone. It is not a symbol of eternal love if it is something that was created last week.” The second reason reaches the heart of fashion: diamonds and natural gemstones are expensive. This is why people will still buy natural emeralds, even though they are some 300 times more expensive than synthetic emeralds. Or more accurately, they buy natural emeralds because they are 300 times more expensive than synthetics. Like luxury cars and designer-brand clothing, the point is not the product itself so much as the ability to say “I can afford this and you can’t.” As long as people can still say “happy birthday, Honey — it’s a natural diamond” I don’t see synthetics destroying the diamond market anytime soon.

References

Diamonds are forever Read More »

BBC Creative Archive

/ Intellectual Property

Greg Dyke, director general of the BBC, has a vision. In a speech he gave this Sunday at the Edinburgh International TV Festival he described his plans for how to leverage the huge BBC media library — give it away.

Looking ahead, let me give you one example of the kind of thing the BBC will be able to do in the future.

The BBC probably has the best television library in the world.

For many years we have had an obligation to make our archive available to the public, it was even in the terms of the last charter.

But what have we done about it?

Well, you all know the problem.

Up until now, this huge resource has remained locked up, inaccessible to the public because there hasn’t been an effective mechanism for distribution.

But the digital revolution and broadband are changing all that.

For the first time, there is an easy and affordable way of making this treasure trove of BBC content available to all.

Let me explain with an easy example.

Just imagine your child comes home from school with homework to make a presentation to the class on lions, or dinosaurs, or Argentina or on the industrial revolution.

He or she goes to the nearest broadband connection – in the library, the school or even at home – and logs onto the BBC library.

They search for real moving pictures which would turn their project into an exciting multi-media presentation.

They download them and, hey presto, they are able to use the BBC material in their presentation for free.

Now that is a dream which we will soon be able to turn into reality.

We intend to allow parts of our programmes, where we own the rights, to be available to anyone in the UK to download so long as they don’t use them for commercial purposes.

Under a simple licensing system, we will allow users to adapt BBC content for their own use.

We are calling this the BBC Creative Archive.

When complete, the BBC will have taken a massive step forward in opening our content to all – be they young or old, rich or poor.

But then it’s not really our content – the people of Britain have paid for it and our role should be to help them use it.

The vision and even the project name sounds like a cross between the Creative Commons project, chaired by Lawrence Lessig, and the Internet Archive founded by Brewster Kahle. No surprise then that Slate reports the BBC talked to both Lessig and Kahle before making their plans. In a blog comment, Kahle also acknowledged the visit: “Yes, the BBC crew was brought to the Archive by Larry Lessig and we showed how inexpensive it can be and how we have dealt with the ego’s and restrictions issues that always come up. I dont know what role we played, but their decision is fantastic and hopefully trendsetting… thank you bbc.”

There are a lot of details that haven’t been announced yet. For example, it’s not clear how much of the BBC library the BBC owns free and clear, or at least freely enough that they can redistribute under a new kind of license. Then there’s the inevitable argument from commercial interests that the BBC shouldn’t be allowed to compete with their own online distribution. This kind of argument will probably hold less sway in the U.K. than it would here in the U.S., however, as the British are already comfortable with the idea of a strong government-sponsored media.

There are lots of reasons this is a great move on the part of the BBC. First and most important, the Internet has brought down distribution costs to the point that, as far as gifts to humanity go, this has a lot of bang for the buck. Second, BBC shows are paid for by fees charged to UK television owners, so there’s a good argument that the library is already owned by the British TV-watching public. These are reason enough, but I like to think there’s even an argument that it is in the BBC’s self-interest to share with free-loading yanks like myself. As Dyke says in his speech, Britain’s television reflects its culture, tastes and values. That kind of export can have far-reaching secondary benefits for a nation, from increased tourism to more desire for British goods. Just think of what a great marketing tool Hollywood has been for Levis Jeans. By making BBC News, BBC documentaries or even Absolutely Fabulous easily available to the world at large the British culture may find real economic returns. As The Guardian put it, “if the BBC doesn’t get its media out to as many people as possible, it’s failing its charter requirements.”

Sidenote: It took me a few days to blog about this, and yet it still hasn’t hit the U.S. press. Aside from the Slate article, Google News is turning up almost no coverage outside of the UK press and the blogs. I try to stay away from conspiracy theories (really, I do) but I can’t help but wonder if the silence has anything to do with the battle being raged between the BBC and Rupert Murdoch, or the fact that Murdoch’s media empire stands to lose the most if things like this start to catch on? Why is this a non-story on this side of the pond?

[UPDATE 9/11/2003: Lawrence Lessig has an article in the Financial Times about the BBC Creative Archive.]

References

BBC Creative Archive Read More »

California Supreme Court Rules in DeCSS-posting Case

/ Intellectual Property

The California Supreme Court ruled today that trade secret laws can trump first amendment protections, overturning a previous Court of Appeals ruling. The case involves an injunction against Andrew Bunner, a San Francisco man who posted the DeCSS DVD encryption-crack code on his Web site. The injunction, which required Bunner to remove the code, was thrown out by the Court of Appeals on First Amendment grounds. The decision is quite narrow, essentially saying “the First Amendment does not categorically prohibit preliminary injunctions to enjoin the publication of trade secrets” and sends the case back to the Court of Appeals to re-examine the facts of the case.

I’ve read the decision, but rather than subject you to my legal ignorance I’ll defer to people in the know. First, Eugene Volokh blogs some legal concerns about the decision, saying that the court failed to explain how it determines that some speech is a matter of “private concern” (which gets less protection than something of public concern) and why it’s proper for the court to make this decision. He also questions their application of case law, especially as it relates to whether there were alternative channels to express the same speech (Justice Moreno makes a similar point in his concurring opinion).

As to how the case will wind up, Dan Gillmor posts this little gem at his blog:

I’ve had a note from a lawyer involved in the case, Tom Moore of Tomlinson Zisko in Palo Alto. He makes some interesting points. Here’s what he says:

I’m one of Andrew Bunner’s lawyers. While today’s Mercury News Internet article is true as far as it goes, it misses the fun part entirely.

The decision is a triumph of politics over logic. When you read the decision, you can follow the logic: (1) Software implicates the First Amendment; (2) trade secrets law implicates the First Amendment; (3) the proper level of scrutiny is intermediate First Amendment scrutiny; and (4) assuming that everything in the trial court’s order is supported factually, the order survives that level of scrutiny. Then you see where politics comes into play: The next logical step should have been for the Cal. Supreme Court to review the record independently. Instead, the Court sent the case back to the Court of Appeals to review the record to see if the facts were there. It’s not as if the Court could not review the record. Justice Moreno did it and concluded: “the DVD Copy Control Association’s… trade secret claim against Bunner is patently without merit.”

So, the Court did the politically safe thing by dodging the actual facts.

Those of us who work on Mr. Bunner’s behalf are more entertained than disappointed. The Court has given us a lot to work with. Indeed, the more significant decision in this case was the Cal. Supreme Court’s earlier decision, Pavlovich v. Superior Court. In that decision, the Court held that the injunction does not extend into Texas. That means that CSS and DeCSS is a secret in California only. Eventually, the public nature of DeCSS will come to the fore.

The precedents set in this case may be important, but as far as DeCSS is concerned this is all shutting the barn door after the horses have already bolted, caught a steamer and are enjoying their vacation in Tahiti. And I have the t-shirt to prove it.

References

California Supreme Court Rules in DeCSS-posting Case Read More »

Independent and willing allies

/ Uncategorized

I haven’t blogged about the SCO vs. IBM case since it’s been so widely discussed elsewhere. The ever-so-brief summary is that SCO sued IBM, claiming that they own IP rights to some code IBM gave to Linux. The open source community rallied. IBM countersued. Red Hat Software sued. Novell indicated that their records show SCO doesn’t own many of the IP rights they think they do. And Eric Raymond, President of the Open Source Initiative, wrote a rather scathing position paper describing how incredibly bogus SCO’s claims are.

Now SCO’s CEO is charging that IBM is secretly stage managing all these attacks. Eric Raymond has responded with an open letter, calling the charge a “brain-boggling disconnect between SCO and reality.” The letter is a fun read, but the key part that struck me was here:

Yes, one of the parties I talk with is, in fact, IBM. And you know what? They’re smarter than you. One of the many things they understand that you do not is that in the kind of confrontation SCO and IBM are having, independent but willing allies are far better value than lackeys and sock puppets. Allies, you see, have initiative and flexibility. The time it takes a lackey to check with HQ for orders is time an ally can spend thinking up ways to make your life complicated that HQ would be too nervous to use. Go on, try to imagine an IBM lawyer approving this letter.

The very best kind of ally is one who comes to one’s side for powerful reasons of his or her own. For principle. For his or her friends and people. For the future. IBM has a lot of allies of that kind now. It’s an alliance you drove together with your arrogance, your overreaching, your insults, and your threats.

That’s a nice description of the loose-knit “smart mob” organizations that are a rising force in this century. Be they open source developers, Howard Dean supporters or “terrorists linked to Al Qaeda,” these communities continue to surprise traditional top-down organizations with their ability to be robust, to adapt, and most surprisingly to be efficient and productive without a strong chain of command.

References

Independent and willing allies Read More »

No seat at the WIPO table for open source

/ Intellectual Property

Back in July, a group of 68 economists, scientists, industry representatives, academics, open-source advocates, consumer advocates and librarians proposed that the World Intellectual Property Organization (WIPO) host a meeting on the use of open collaborative development models. Examples described in the proposal include IETF standards, open-source software such as Apache and Apple’s Darwin OS, the Human Genome Project and open academic journals, among others. The WIPO’s initial response was quite favorable. Dr. Francis Gurry, WIPO Assistant Director and Legal Counsel, was quoted by Nature Magazine as saying “The use of open and collaborative development models for research and innovation is a very important and interesting development… The director-general looks forward with enthusiasm to taking up the invitation to organize a conference to explore the scope and application of these models.”

Needless to say, business interests like Microsoft saw such high-profile acceptance of open source as a threat, and immediately lobbied to have the idea squashed. The Washington Post and National Journal’s Technology Daily report that Lois Boland, the U.S. Patent and Trademark Office Acting Director of International Relations, dismissed the meeting as out of the WIPO’s area, saying the organization is “clearly limited to the protection of intellectual property.” “To have a meeting whose primary objective is to waive or remove those protections seems to go against the mission,” Boland told National Journal. She argued specifically against the discussion of open-source models, claiming that open-source software is not protected under copyright law but only contract law, which is not in the domain of WIPO. She also protested the manner in which the meeting was organized, saying WIPO’s agenda should be driven by member nations and the idea came from outside the organization. Under increasing pressure, WIPO canceled the meeting, saying the polarized political debate made the possibility of international policy discussion “increasingly remote.”

Lawrence Lessig’s blog blasts Boland, saying “If Lois Boland said this, then she should be asked to resign. The level of ignorance built into that statement is astonishing, and the idea that a government official of her level would be so ignorant is an embarrassment.” Personally I think Lessig is missing the broader picture here, or perhaps he is just not cynical enough. Rather than ignorance, Boland is simply showing unusual candor in her statements. Her position is that WIPO should promote international IP laws that support the current content industry, regardless of how that affects new upstart industries, national productivity, the economy or other important concerns. In the words of The Economist, she is being pro-business, but not pro-market. I agree with Lessig that this is abhorrent, but given how the U.S. continues to force brand-new IP protections down the world’s collective throat it seems to be a fair description of current U.S. policy.

The issues described in the proposal to the WIPO are not going to go away, and will eventually need to be addressed with or without the involvement of WIPO. As Ed Black, president of the Computer and Communications Industry Association, said on hearing the meeting was canceled: “Does this indicate that WIPO is abdicating authority and responsibility for these issues, including open source for the future? If so, we will all live by that, but then so must they. They should step up the plate or step aside. … It is inexplicable that they would shut the door on what are clearly important issues.”

References

No seat at the WIPO table for open source Read More »

Face Recognition gets the boot in Tampa

/ Big Brother

Tampa Police have decided to scrap their much-criticized face-recognition system, admitting that during a two-year trial the system did not correctly identify a single suspect. Similar face-recognition systems are still in use in Pinellas County, Florida, and Virginia Beach, Virginia, though neither of these systems have ever resulted in an arrest either.

Face-recognition technology evokes images of automatic cameras scanning bustling crowds, automatically picking out terrorists from the millions of faces that pass by. One day the technology may be able to deliver on this, but currently it is still necessary for a human controller to zoom in on individual faces using a joystick. A 2001 St. Petersburg Times article describes a Tampa police officer scanning the weekend crowd in Ybor City, checking 457 faces out of the some 125,000 tourists and revelers in an evening.

Let’s do some quick math. The police are only scanning 457 out of 125,000 people on a given night, or 0.3%. That means even if ten known bad guys from the watch-list are in the crowd, there’s still only a 4% chance any one of them will be looked at by the system. That number drops to 0.4% if there’s only one bad guy in the crowd that night.

Then there’s the chance that the face recognition system doesn’t sound an alarm. A recently published evaluation of the Identix system used in Tampa gives a base hit rate of 77% (that is, 77% of people on a watch-list were correctly identified). However, that was with a watch-list of only 25 faces. The hit rate goes down as watch-list size goes up, down to 56% with a watch-list of 3000 faces. According to the Associated Press, the Tampa database had over 24,000 mug shots on its watch-list. Then there’s the problem that mug shots were taken indoors and the surveillance cameras were outdoors. According to the evaluation, mixing indoors and outdoors can reduce hit rates by around 40%. (The 40% reduction was seen on identity verification tasks; the watch-list task is actually more difficult.) Finally, these results all assume a 1% false-positive rate, which would result in five false alarms per night. Given all these (well-known) problems, it’s amazing anyone ever thought this was a good idea.

There’re several reasons I hope this failure dissuades similar attempts by other law-enforcement communities. First, as a 2001 ACLU report on the Tampa system points out, our resources could be better spent, and face recognition can give us a false sense of security. Second, a face-recognition systems in a public space gives the impression that everyone is a suspect, regardless of whether the system actually works. And finally, face recognition technology continues to improve. It won’t happen in the next few years, but at some point the technology is going to reach the point where recognition is completely automated, high accuracy, and robust. When that happens, it will be possible to track large numbers of people as they go about their daily lives, and even track people retroactively from recorded video. Hopefully by this time our society will be so inoculated against such privacy violations that such uses will be inconceivable.

References

Face Recognition gets the boot in Tampa Read More »