Encryption ghosting - the spies suggest breaching civil liberties for a solution that doesn't work anyway
That there are times when civil liberties take a back seat to other issues more pressing is obviously true. Sad, but true. In time of war, however distressing this might be, we don’t have a jury trial before shooting at the enemy soldier. Nor do we do so in some time of civil mayhem, the Riot Act exists for a reason and so on.
However, before we permit the erosion of those rights we do want to know that the solution is both necessary and also works. It’s that second that GCHQ’s latest idea fails. The thought is that we can all still use end to end encryption. But that such a system must create a “ghost” message. GCHQ must be cc’d with a copy of what we’re saying to each other. So that they can, if they wish, then try to break that encryption.
Obviously, of course, they’d only do so when pursuing really bad guys. Oh yes. As to why this rather than a back door which simply allowed them to decrypt such a backdoor is exploitable by every bad guy out there so that’s not a good solution.
And yet, quite clearly, this won’t work. The code - source code - for end to end encryption is easily available, undoubtedly there are versions on GitHub and the like. Therefore, what will happen? The commercial forms of such messaging systems would - if such a law were passed - contain such ghosting. Our civil liberties would have been reduced. But to no good end. For what are the bad guys we’re trying to catch going to do? Go get the source code and create their own end to end encryption networks which don’t contain the ghosting.
There’s really no point to such a diminution of our freedoms if it simply won’t solve the problem to hand, is there?
Voltaire, champion of freedom
François-Marie Arouet, known to history as Voltaire, died on May 30th, 1778. He was a major figure in the Enlightenment, a writer, historian and philosopher, renowned for his advocacy of freedom of religion, freedom of speech, and the separation of church and state.
He authored more than 2,000 books, essays and pamphlets, in addition to over 20,000 letters. He was versatile, writing novels, plays and poems, in addition to scientific papers and historical studies. He bravely advocated civil liberties in an age of aristocratic dominance and arbitrary control of the law. He fought against the censorship laws of France by publishing satires attacking the intolerance of Church dogma, and the repression of French institutions.
When a young French nobleman belittled his lack of breeding, Voltaire insulted him back, and was arrested and imprisoned in the Bastille without any due process. His suggested alternative punishment of exile to England was accepted, and proved to be the making of him. He admired Britain’s constitutional monarchy and its greater respect for liberty and free speech.
Most of all Voltaire is famous for his relentless attacks on aristocratic and Church power in France, who oppressed the bourgeoisie and commoners on whom the bulk of the tax burden fell. His most famous satirical work, Candide, has its eponymous hero ploughing through every conceivable disaster, only to have Prof. Pangloss (Leibniz) reassuring us that everything is for the best in this best of all possible worlds. The novel ridicules religion, theologians, governments, armies, philosophies, and philosophers.
Like many famous figures from Sherlock Holmes to Rick of Casablanca, Voltaire never actually said the line he is famous for: "I disapprove of what you say, but I will defend to the death your right to say it." This was written by Evelyn Beatrice Hall to sum up Voltaire’s attitude, which it does succinctly.
Between 1727 and 1728 he lodged at Maiden Lane, Covent Garden, where a plaque now commemorates his residence there. He was a great fan of coffee, reportedly drinking 50-72 cups a day, which might explain his prolific creative output.
His advocacy of freedom of thought and speech eventually won through, and these principles are widely recognized in Britain and America, except in their universities. Developed and civilized countries acknowledge freedom of religion and religious expression, but significant parts of the world still imprison and execute people for heresy. In modern times the head of Iran called for a Western writer to be murdered, and in France the writers of a satirical magazine were murdered by religious zealots who took exception to what they had published.
Voltaire reminds us that there are states and religions that still oppress and seek to bind into conformity any attempt at free and independent thinking. His spirit lives on, reminding us to oppose such barbarism and not to surrender to its use of violence to silence us.
Empire tax avoidance - if true, how wonderful
The Tax Justice Network is shouting about how those remnants of empire, the territories and dependencies, drive corporate tax avoidance. Let us assume that TJN are correct in this claim - isn’t that a lovely and wondrous thing?
The UK and its “corporate tax haven network” is by far the world’s greatest enabler of corporate tax avoidance, research has claimed.
British territories and dependencies made up four of the 10 places that have done the most to “proliferate corporate tax avoidance” on the corporate tax haven index.
Corporate tax avoidance being a good thing, therefore this is a good thing, enabling it.
Alex Cobham, the Tax Justice Network chief executive, said a handful of the richest countries had waged a world tax war “so corrosive it had broken the global corporate tax system beyond repair”.
Truly excellent then.
This is not because we believe the plutocrats should never be taxed - we’re right with Adam Smith himself in more than in proportion of the tax burden. Rather, it’s just that we’ve read a little further in the economic textbooks and know that corporate taxation is a bad system of taxation. We shouldn’t be trying to tax economic activity at the level of the firm at all.
Given that the entire economy is indeed incomes to someone we can and should tax that economic activity when it turns up as an income to someone. Simples - and yes, the standard research does indeed tell us that this is economically efficient in a manner that corporate taxation is not. That we’ve a legal and regulatory system in which competition leads to this desirable outcome, the collapse of the inefficient current system? Well, that’s good, isn’t it.
Einstein, and the importance of testing
On May 29th, 1919, exactly 100 years ago, an historic experiment took place. Einstein had published his General Theory of Relativity in 1915, and an opportunity arose during the solar eclipse of May 29th in 1919 to test his hypothesis. If light were indeed bent by gravity, then a couple of stars in the constellation of Taurus would be visible during the eclipse, not in the position that Newtonian physics suggested, but displaced by gravity. Two expeditions set out to test this, one by Dyson and Eddington to Principe island, the other by Crommelin and Davidson to Brazil. Both found the stars were indeed observed where Einstein’s theory predicted.
The young Karl Popper, aged 17 at the time, was powerfully influenced by this. His Vienna was abuzz with the radical ideas of Marx, Adler and Einstein. Adler had introduced the notion of inferiority complexes in childhood. Popper came across a case that didn’t seem to fit, and took it to Adler. He reported that Adler had no difficulty in explaining it in terms of his theory, even though he knew nothing about the person in question.
“How can you be so sure?” he asked Adler. The great man replied, “I know it from my thousand-fold experience.” To which young Popper replied, “And now I suppose it’s a thousand and one,” suddenly realizing that if all cases could be fitted into the theory, none could ever test it. It was the same with Marx’s theories - they could explain everything that happened, no matter what outcome prevailed. Einstein was different. His theory lived dangerously. If the two stars had not appeared in their predicted positions, his theory would have had to be discarded. Popper realized then that theories had to be capable of being tested, and rejected if observations went against them.
It was an insight that led to his “Logic of Scientific Discovery,” rejecting induction in favour of what he called “conjecture and refutation,” meaning that creative proposals had to be tested against the world of our observation. It lies at the core of neoliberalism. Marxism and socialism interpret the world, but neoliberalism seeks to change it by applying techniques that work in practice. Its record has far surpassed that of its rivals. It has created the wealth that has lifted men and women out of degrading subsistence toil and given them opportunities for advancement undreamed of by previous generations. It has lowered death rates, increased lifespan, conquered diseases, and generally improved the condition of humankind.
The importance is testing. If observed reality goes against a practice, it has to be modified or rejected. Socialism, by contrast, rejects the evidence if observation shows that it fails to achieve its objectives. If it does not bring the promised equality and prosperity, its advocates claim that “it wasn’t really socialism.” Thus socialism can never be disproved, and cannot, therefore, contain any insights of value about the real world, the one that we live in.
On that day 100 years ago, we learned something important, that theories have to be tested against the observed world. Depending on how they perform, they have to be modified or rejected, and only the useful ones are retained. This is why neoliberalism has improved the world, and why socialism has not.
The problem with communal ownership - community flowers in Brixton
That private property is theft is a mantra well known to us all. That there has to be a management system for property is even more obvious. That private property, even if we accept the first contention, is the best solution to the requirement is something all too many don’t wish to acknowledge. Yet it is true, as this about community flowers in Brixton tells us:
A flower row has erupted on the streets of Brixton after a community grower accused their neighbours of stealing blooms planted by a community group.
The problem? There’s no enforcement of property rights going on.
The original note poster responded, explaining that the lupins and geraniums were planted as part of a local scheme called Our Streets, in which members of the local community in south London "adopt" a tree to water and plant flowers under.
They added that the flowers have now been dug up and "moved elsewhere".
The neighbour who first replied seemed intent on having the last word, and penned: "Helpful to know that the flowers were part of a community project. However, if that was the case, it was very misleading to refer to them as 'my' flowers.
One amusement is that this is being done with Post-It notes rather than on Twitter. However, the underlying problem is a common one. For we’re in Tragedy of the Commons territory here.
There has to be some management system. Can be private ownership, a capitalist solution. Can be regulatory, a socialist one. As Hardin pointed out, which will work best depends upon the specifics of the item and situation. Elinor Ostrom took us further in our understanding, community self-regulation can indeed work. But the emphasis there is upon “can”.
Ostrom started from the sensible observation that there are commons which do survive without regulatory or private solutions. So, how do they work then? The obvious corollary to which is that those that don’t so work have already disappeared. Thus we cannot take Ostrom’s work as an insistence that community self-regulation will always work - only that sometimes it does.
As, sometimes it doesn’t. Ostrom’s own finding being that when we start to talk of groups bigger than a few thousand, perhaps 3,000 people at the top end, then the community bonds aren’t going to be strong enough for them to be binding on behaviour. The ability to free ride without significant cost from that community will be too great.
How many walk the garden streets of Brixton? There is our problem, isn’t it?
We’re entirely pragmatists around here. We’ve no great ideological attachment to specific forms of property management. We agree that at times the regulatory, governmental, solution is the one that’s going to work. So also that the vast majority of the time it’s going to be private ownership. Which is dependent upon the details. We even agree that this communal and undefined system will indeed work. But, from observation, only in a community small enough for it to do so. Which isn’t, sadly for the romantics about human nature, a useful description of most communities in the modern world.
Who was wearing the trousers
On May 28th, 1923, the US Attorney General declared that it was legal for women to wear trousers anywhere. This was by no means the end of the matter, though it was a significant landmark. The prohibition of trousers for women was enforced in most European countries and US states not only by social custom, but by laws that punished transgressors.
Several women defied this ban, not only for freedom of movement, but for disguise, especially for runaway slave women, and in some cases to earn much more than women could earn. Several prominent women activists were arrested and sentenced for wearing clothing that was deemed appropriate only for men. Amelia Bloomer popularized the loose-fitting garment that bears her name, and bloomers caught on as women took up cycling, tennis and horse-riding. Demure ladies might ride horseback side-saddle in skirts, but most found riding-breeches more practical.
Two world wars that saw women doing men’s jobs while men were away in combat helped speed along more relaxed attitudes to modes of dress, and female pilots often preferred trousers. Many states still passed and enforced laws against cross dressing in the 20th Century, however, despite the 1923 declaration by the Attorney General. Female senators were banned from wearing trousers on the senate floor until 1993, and it was only in 2013 that a Paris by-law that required women to seek city permission before wearing trousers was revoked - it had previously allowed them only for cycling or horse-riding.
Remaining restrictions in modern developed countries are now more or less confined to institutions imposing rules, rather than legal bans. Some schools insist on a “skirts only” code for girls, and some businesses such as airlines have required them for female flight attendants. The Royal Canadian Mounted Police dropped its opposition in 2012, British Airways did so in 2016, and Virgin Atlantic began permitting trousers for its female staff earlier this year.
Some religious orders ban women from wearing men’s clothing or otherwise dressing “immodestly.” It was long banned by Christian churches, which quoted Deuteronomy 22:5 saying, “The woman shall not wear that which pertaineth unto a man, neither shall a man put on a woman's garment: for all that do so are abomination unto the Lord thy God.” And by coincidence it was on May 28th, 1431, that Joan of Arc was charged with “relapsing into heresy” by donning male clothing (i.e. military attire) again. She was convicted and burned at the stake.
Trousers on women have been symbolic of the slow transition from ancient to modern, from patriarchy to a more gender-equal society. The march into liberty took longer for women than it did for men, but the changes in social attitudes that permitted greater choice about deportment and lifestyle have been a liberating influence for both.
We like Roger Bootle, we do, but we think he's being unduly optimistic here
The thought that perhaps the next Prime Minister might have a sound knowledge of economics is a comforting one. But we fear that this isn’t in fact the problem. Rather, it’s not the knowledge, it’s the incentives:
Now that the search for a new Prime Minister is under way, after the disasters of the last couple of years it is worth reflecting on how important it is that Mrs May’s replacement has a sound grasp of economics.
History gives a mixed message. Mrs May herself was not burdened with an understanding of economics, nor much interest in it.
The thought that someone who knows their economics will be better is that comforting one. But then Karl Marx knew his economics - he lifted an awful lot from Adam Smith after all - and other than John McDonnell few think he’d have made a good Prime Minister.
The problem, we fear, being not the knowledge of the subject but the incentives faced by an elected politician. In order to keep the job it is necessary to win the next election. That means that the useful time horizon is never more than 4 and a bit years, on average is around two. Given that either fiscal or monetary policy take a couple of years to make a difference this is problematic. It’s obviously worse when we move to microeconomic matters where misrule might take a decade or two to turn up.
It’s easy enough to gain electoral favour by announcing some measure of spending here or there. The effects of the collection to fund the spending turning up only after that period of time.
That is, a system whereby our money is spent by those who must regularly appeal to the mob produces the wrong incentives for those rulers.
No, this is not to say that democracy has thus failed - an undemocratic regime faces exactly the same problems of panem et circences as we can observe around the world. The answer is to structure the system so that we move from St Milton’s fourth method - spending other peoples’ money on other people - to the first, we spend our own money on ourselves. That’s actually useful knowledge of the heart of economics and we might indeed hope that the next PM grasps that point.
Habeas corpus and the protection of liberties
340 years ago on this day, May 27th, 1679, the Habeas Corpus Act passed and became part of the laws of England. Designed to safeguard against illegal detention, it requires a detained person to be produced before court in order to ascertain if the detention is lawful. Witnesses will be required to establish this before the detention can be continued. Meaning “you have the body,” it names a person and requires the authorities to bring them before a court, thereby ruling out their ability to continue to imprison them in secrecy.
Along with Magna Carta, the Petition of Right and the Bill of Rights, habeas corpus is regarded as one of the landmarks along the road that led to the establishment of English liberties and the limits of untrammelled state power against them. These were rights that limited the power of the power of the state, then expressed in the hands of the monarch, to encroach arbitrarily on the liberties of the subject. These rights were not granted graciously by authority, nor were they natural rights deduced from something inherent in people’s nature, nor even were they derived from some ancient social contract alleged to have been made in primitive times. Instead they had evolved from the traditional ways in which tribes and societies had recognized that leaders had obligations to their fellows and followers, as well as authority over them.
Spiderman’s uncle famously said, “With great power comes great responsibility,” implying that those with power have a moral obligation to exercise its use with discretion and restraint. This is not the English tradition. It relies not on moral restraint, but on limits set by laws. Those in power are restrained, not because they are virtuous, but because they come under laws that protect every one of those subject to that power from its arbitrary use.
In Robert Bolt’s “A Man for all Seasons,” Thomas More is asked if he would give the devil himself the protection of English laws, and replies that he would.
“This country is planted thick with laws, from coast to coast, Man's laws, not God's! And if you cut them down, and you're just the man to do it, do you really think you could stand upright in the winds that would blow then? Yes, I'd give the Devil benefit of law, for my own safety's sake!”
It expresses the view that it is laws and institutions that protect our liberties, not because we choose wise and virtuous leaders, like Plato’s philosopher kings, but because we restrain them. These rights have been codified over time in acts like Habeas Corpus, but they were not established by those acts, just confirmed by them. When the Founding Fathers in America objected to arbitrary acts imposed from a distant colonial ruler, they wanted to preserve their established rights, not to seek new ones. One of their number, George Mason, stated that "We claim nothing but the liberty and privileges of Englishmen in the same degree, as if we had continued among our brethren in Great Britain.”
Habeas Corpus was an important landmark in the honourable tradition of confirming established liberties in law, and in bringing authorities under legal obligation to respect them.
If only Will Hutton understood what he's talking about
The Will Hutton solution to British Steel is obvious of course. Remain, government subsidy, sunlit uplands. This being the Will Hutton solution to everything.
However, such Olympian solutions always do suffer from those little technical problems, don’t they? That being why government subsidy directed by newspaper columnists is a less than wondrous solution. Here Hutton tells us that British Steel will be -= or could be, should be - saved by decarbonised steel:
What’s more, the company’s vital reinvention – around making decarbonised steel, say – and a general revived manufacturing industry requires a purposed industrial strategy on a much larger scale than what we have.
What’s being missed there is that we know how to make decarbonised steel. It’s easy. And we do a lot of it:
Blast furnaces such as the one at Scunthorpe make steel from scratch and, once shut down, are more or less impossible to replace. Greener, less energy-intensive electric arc furnaces, of which the UK has four, can make steel by recycling scrap.
Run your arc furnace off renewables created electricity and you’ve decarbonised steel production. It’s also nice and cheap to do so. Which is why we do do so. Decarbonising a blast furnace isn’t really an option for we’re looking for the chemical reaction between the carbon in the coal and the iron ore as well as the energy produced by the combustion.
Which is precisely British Steel’s problem. It runs a blast furnace. The old technology we need very much less of these days. Precisely because the hippies have won, we recycle much more. And, pace Will Hutton’s plans, we do produce decarbonised steel. It’s just that to do so we don’t need a blast furnace.
The entire problem over Scunthorpe is that we’ve already done what Hutton demands. Which is probably all we need to know about the wisdom and perspicacity of Willy Hutton’s demands, isn’t it?
Venezuela Campaign: Cartel of the Suns
When a criminal cartel takes hold of a state like Venezuela, it poses a difficult challenge for the international community.
The main focus of Maduro’s regime is personal enrichment for its leading members – mainly through crime. Outright drug smuggling is a huge source of revenue for the regime. The cabal of ministers and generals who control it are known as the ‘Cartel of the Suns’, and there is much evidence pointing to top regime leaders’ involvement in the narcotics trade.
Diosdado Cabello, head of the puppet legislature known as the National Constituent Assembly and Tareck El-Aissami, the Minister of Industries, have been sanctioned for their drug trafficking activities. This has been confirmed in leaked Venezuelan intelligence files. Members of Maduro’s own family are currently in prison in the US for cocaine smuggling.
Venezuela is the main source of drugs smuggled into the US and Europe. The quantity of drug flights from Venezuela has been expanding rapidly in recent years, growing from around one flight a week in 2017 to daily flights in 2018, mainly using around 50 runways in the north-western state of Zulia. The value of the cocaine that reaches American streets from Venezuela is around $39 billion. The Maduro regime receives billions for its part in these operations
Another way the regime is siphoning off money into its own pockets is through misuse of a subsidized food programme, known by its Spanish initials ‘CLAP’. CLAP is run by the Venezuelan military through a network of companies owned or controlled by Alex Saab. Saab was appointed to this role by Maduro himself. The US has just announced that it is preparing sanctions and criminal charges against those involved in the programme. Saab himself was indicted this month in Colombia on money-laundering and fraud charges. Prosecutors now say he is also being investigated for laundering money for Colombian drug cartels.
How has this programme been used for corruption? Venezuelan officials sign overpriced, no-bid contracts with suppliers abroad, who send low quality food to Venezuela. Some of it is diverted to the black market. The regime then pays suppliers through a state-owned bank, with overpayments distributed to various bank accounts and into other investments controlled by the conspirators, who have amassed vast quantities of real estate, yachts and airplanes.
Illegal mining in co-operation with Colombian guerrilla groups is another critical means for regime members to cash in. Causing huge environmental destruction, gold is illegally extracted from the Amazonian basin by armed groups colluding with the Venezuelan military. Much of this is laundered through Suriname, a small country ruled by Desi Bouterse, a convicted cocaine trafficker who gained office with financial support from Chavez. The illegal gold is badged as coming from a facility in Suriname called KSMH, a fictional site whose entire purpose is to act as a cover for Venezuela’s strip-mined gold.
Although the Venezuelan oil industry has largely been destroyed by Chavista policies, stealing from the state oil company PDVSA through kickbacks, currency manipulation and other means still continues. Just last year in the US, 12 individuals were convicted of stealing $1.2 billion from PDVSA. Chavistas often cooperate with ‘ideological allies’ in other states in order to facilitate such corruption. One of the original cross-border theft schemes was that of falsified oil sales, started in Chavez’s time. For example, PDVSA owns 60 percent of Alba Petroleos in El Salvador. This subsidiary received virtually no oil from PDVSA between 2010 and 2017 but recorded an income of $1.2 billion over that period. The 51% owned Nicaraguan subsidiary Albanisa did get some oil from PDVSA, but still received funds far in excess of their value, constituting a theft of $4-6 billion.
Both subsidiaries, in cahoots with local Chavista-aligned politicians, then set up and lent money to dozens of front companies – from food production to airlines – which didn’t actually produce anything. Their entire operation consisted of moving money to various havens in Belize, the Cayman Islands and Russia. The debt was then declared unrecoverable.
Recognising that the Maduro regime is actually a criminal cartel has serious policy consequences. Firstly, coming to an agreement with their leaders in which they go scot-free is unlikely to be fruitful, since they will always fear being tracked down and arrested. Better to convince their underlings to switch sides. Secondly, a robust approach to dealing with the criminals makes more sense. For example, the closure of Venezuelan airspace to stop drug flights is an approach that would cut off another source of regime funds. When it is recognised that we are dealing with a criminal regime, what needs to be done should become clearer.