December 2003 - cypherpunks-legacy

Extropia remailer
by Martin.Greifer＠f28.n125.z1.FIDONET.ORG 17 Dec '03

17 Dec '03

Is it just me, or is the usually-reliable Extropia remailer (remail(a)extropia.wimsey.com) down? ... Origin: The Crusade for Moorish Dignity, N'orl'ns, LA ___ Blue Wave/QWK v2.12 -- Martin Greifer - via FidoNet node 1:125/1 UUCP: ...!uunet!kumr!shelter!28!Martin.Greifer INTERNET: Martin.Greifer(a)f28.n125.z1.FIDONET.ORG

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But Detweiler _Is_! (Was Re: szabo@netcom.com is NOT a tentacle!!!)
by lefty＠apple.com 17 Dec '03

17 Dec '03

>This feels like Detweiler spoofing again. Anyone else get that >feeling? It's certainly possible. A possibility which, I might add, raises in me an almost uncontrollable desire to yawn, deeply. Isn't it interesting, though, that Mr. Detweiler has become precisely what he rails against? As Friedrich Nietzsche once remarked, "He who fights with monsters should see to it that he does not _become_ a monster." FWIW, I felt that the "Tentacles--I don't get it" posting was a good candidate for hidden Detweiler-hood as well. Mr. Detweiler, the abyss is gazing into you... -- Lefty (lefty(a)apple.com) C:.M:.C:., D:.O:.D:.

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Re: szabo@netcom.com is NOT a tentacle!!!
by futor＠llnl.gov 17 Dec '03

17 Dec '03

> This feels like Detweiler spoofing again. > Anyone else get that feeling? It's not. I recognize: >> ------ Legalize: >--<o | I confess to an unatural, and abnormal . >> \ / :-)-~ o>--< | act I have programmed a computer. . . >> \ / You are ~1,000,000,000,000,000 .1ms NAND gates have a nice day. . . . >> \/ The true theory of everything will run on a finite turing machine. . . . from someone else on the net. There *are* similarities between their names, but I doubt that they're the same person. I *have* been wrong before, however. __ \/ -+- randy -+- all generalizations are flawed -+- futor(a)llnl.gov

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underground industry
by Perry E. Metzger 17 Dec '03

17 Dec '03

Someone asked me the obvious question in private mail... > > Perhaps not. Its very common in many large business conducted here in > > New York in certain seemingly legitimate industries for much of the > > business to be conducted off the books -- people who will take cash > > for work are sought after. I will not name the industry in question, > > but it is one of the few major ones left in the city and it isn't > > finance. > > Politics? Politics also involves some of that, but it wasn't what I was refering to. The answer to the question is the garment industry. Huge underground factories and design shops operate on a completely cash basis. Millions of dollars of goods enter in to the system "mysteriously". There are "sweatshops" (read, free market factories) operating all over the city in concealed locations. They are almost always operated by the Chinese -- they have a code of silence about such things. Its one of the few things thats keeping the economy in NYC going. This operates on a HUGE scale. Its a counterexample to Hal's beliefs about industry and taxation. Perry

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Re: Public key encryption, income tax and government
by nobody＠soda.berkeley.edu 17 Dec '03

17 Dec '03

Hal Finney put out an excellent posting on why digicash and such are not likely to undercut the tax system. While a lot of what he says is valid, I would like to throw in another data point. You see, my wife is Italian, and I've spent quite a bit of time hanging out with the in-laws, seeing how they live and how their society works. Italy's underground economy is estimated at being 30% or more of the total GDP. It is a very cash-based economy, obviously. It is also a country where, IMHO, standards for honesty are lower than in the US and a certain amount of cleverness in avoiding things like taxes earns respect. Any Italian will tell you with pride that Italians do not follow rules. Italian merchants are required by law to produce receipts for every transaction. In fact, you as a customer may be required to produce the receipt on demand and will be fined if you do not have it. Nonetheless, if you do not insist on a receipt for many purchases -- even for very expensive things -- it has a good chance of not being produced. If you do insist, the price may suddenly increase. Tax evasion at the retail level is widespread. > Suppose I walk into IBM today and offer to go to work as a programmer, > for 10% less than they would normally pay me, as long as they pay me > "off the books", and pass on to me in cash the amount they would > normally have to pay to the government in payroll taxes. Sounds like a > win-win situation, right? Both IBM and I save money. But naturally > IBM won't agree to this. The only taxes that are sure to be paid are wage taxes for normal employees. Right? Well...for normal work, yes. My brother-in-law works in a furniture factory that, like all the rest of them, does a lot of its production off the books. As a result, much of his work is off the books too. This is how Italians make ends meet in a country with (relative to us) low salaries and high prices. There is a word for it -- arrangarsi -- "to arrange oneself". Tax evasion at the manufacturing/wholesale levels is widespread. The official response to this is a good study in governmental desperation. Customers are fined for leaving businesses without a receipt. Your car may be stopped and searched for undocumented merchandise at any time. Imputed income taxes for self-employed people are at ridiculous levels (i.e. a large degree of evasion is assumed). Taxes are levied on everything (car radios, the width of your driveway, electric lighters for gas stoves). I am told that Italians were, at one time, forbidden to possess foreign bank accounts; this rule is not sustainable under the European Community, of course. And none of the above is working very well. As long as Italians believe that it is their right to skip out on their taxes (while, of course, demanding extensive benefits from the government) the situation will continue. I guess my point here is that one should not be too quick to assume that this sort of situation could not arise in the US. Cryptography and digital cash may not, in and of themselves, bring down the tax system. But if Americans decide that they have had enough of it, severe problems could arise with or without such tools; they would only make it easier. Tax evasion rates are low (relatively) in the US because people here are more inclined to follow the rules, and because most people seem to believe that you can't get something for nothing. That is a much more powerful force than any repressive governmental action.

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Public key encryption, in
by Duncan Frissell 17 Dec '03

17 Dec '03

R >As I see it, cryptography may extend similar conditions to R >information workers - programmers, architects, authors. Naturally, R >since a disproportionate number of those on the net fall into these R >categories, this seems like a revolutionary development. But from the R >larger perspective, it is not a major change. R > R >The fact is, information purchases are a small part of most people's R >budgets. If you add up all of what the average person purchases that R >would fall into the general category of "information" - books, R >magazines, newspapers, music, video - you probably won't exceed a few R >percent of income. Information, despite the hype, is not a dominant R >part of our economy. You left out a few information purchases: education, much of medicine, all of financial services, design, marketing, supervision, and management. Note the current tendany to "unbundle" tasks and outsource them to other businesses will tend to encourage the development of "information only" companies. Once the interface is good enough, virtual offices with full workgroup interaction built of pure information will spring up and the "information" component of much of what we think of as physical work will become apparent. I expect information purchases (broadly defined) to reach 90% of our GDP in a few years. Agriculture once represented 90% of GWP (Gross World Product). It is now down to the 5% range in the OECD countries. Yet we eat better than our ancestors. Goods industries (and real estate sales) can show a similar relative decline. We will have more "stuff" than ever, it will just be a smaller part of the total economy. What will cause this growth? Humans are *thinking* machines. We exist inside our minds. We already exist as 100% information. What we are doing is to map the rest of the world to bring it into congruance with what we already are. We don't feel as many constraints in our mind as we do in our bodies. We are deploying our minds to reduce the physical restraints under which we've labored. (Just a guess...) In any case, since the restraints are fewer in the non-physical universe than in the physical universe, costs are lower and much of the growth of the economy will be in the non-physical realm. Certainly the non-physical parts of the economy have grown more than the physical ones in the OECD countries in recent years. If there is also a *regulatory* difference between the physical and the non-physical worlds, then this switch to the non-physical will be exaserbated. R >Particularly at the corporate level, the notion that cryptography R >will allow widespread tax cheating seems especially questionable. Did you see HP on 60 Minutes with Indian contract programmers hired cheaply in probable violatiion of US immigration law. Companies are already setting up programming shops in India. Once they are set up "in cyberspace" they will be harder to control. R >I don't fully understand Duncan's arguments for how taxes can be R >avoided through being a non-citizen. I gather, though, that this would R >require me to either move to another country, or to go to work for a R >company that is in another country. Neither seems likely in the next R >few years for the majority of citizens. 95% of the world's population are not US Citizens/Permanent Residents. You may not be willing to live in another country but they already are. Since other countries don't tax their expats (as the US does) it is easier for non-US expats to eliminate their tax liability. In the past you had to be in the US to work here but foreigners will soon be able to work for US-based companies as easily as anyone else. Because of tax savings, they will be able to underbid US workers. Also companies (or more likely contract services firms) will be able to themselves locate in friendlier jurisdictions and still supply workers (from anywhere on earth to anywhere on earth) to companies that may be in the US or somewhere else. Remember, under current law it is legal for a US company to hire workers overseas and US taxes are not owed. There are technical questions of withholding from payments to entities located in non-tax-treaty jurisdictions but these problems can be planned around. Offshore subsidiaries will also be very cheap to form. If you wander down the shopping street of a future MUD/MOO and you buy or sell things, what nation has jurisdiction for tax purposes. What if the MUD/MOO exists as a set of cooperative processes spread around the globe. There is commerce there but who rules. The proprietors not any government. Look at the situation in this country vis a vis state income and sales taxes. There is tremendous fiddling going on now in a country with the soverign jurisdiction of the federal government and concepts like "full faith and credit." Imagine how much fiddling there will be when disperate soverignties are involved with no overall international authority. Tax compliance is down anyway, it will further decline as more people are self-employed or "reside" in ambiguous jurisdictions. DCF --- WinQwk 2.0b#1165

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CRYPTO & TAXES
by Sandy 17 Dec '03

17 Dec '03

-----BEGIN PGP SIGNED MESSAGE----- ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ SANDY SANDFORT Reply to: ssandfort(a)attmail.com . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C'Punks, Hal still has his doubts about crypto and taxes. He wrote: I can agree that cryptography will make some kinds of illegal private transactions easier. What I doubt is that this will happen at a large enough scale to seriously threaten the ability of governments to fund themselves by taxes. Government tax policies are extremely susceptible to the "tipping factor." Initially, non-compliance is addressed by simply hiking up collections across the boards. When non-compliance reaches some critical factor, however, such techniques become counter- productive. Previously compliant taxpayers begin to chaff at higher taxes and more aggressive collection. More and more become non-compliant as taxes go higher and higher. Eventually, the runaway chain reaction either causes the government to cut back or the system undergoes a core melt-down. Non-crypto versions of this scenario have occurred repeatedly in countries around the world. Hal also have several specific examples of transactions he felt demonstrated the difficulty of using crypto-anarchy techniques. Perry and others have address some of these, but one or two things should be added to round out the picture. Hal wrote: Most of our transactions are done with businesses, generally corporations. Imagine taking $15,000 in cash to buy a new car anonymously. I believe you will find that the car dealers will not cooperate, that government regulations (designed to crack down on drug dealers) will require them to get some ID from you. Digicash would presumably be under the same restrictions. Maybe, but the example begs the question. You don't need to *own* a car, to have the *use* of a car. Imagine leasing a car and using your cyberspace bank digital checks, digital money or credit card to pay the monthly rent. No audit trail, and no asset to be seized. Similar techniques can be used for virtually all of your assets. Don't like renting? Well there are other offshore techniques that can cure that problem as well. I don't fully understand Duncan's arguments for how taxes can be avoided through being a non-citizen. I gather, though, that this would require me to either move to another country, or to go to work for a company that is in another country. . . . I think Hal hasn't been reading Duncan or my posts very closely. Here's a hint: A Cayman Islands corporation is a non-US citizen even if it is owned by an American. You have questions? We have answers. S a n d y >>>>>> Please send e-mail to: ssandfort(a)attmail.com <<<<<< ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ -----BEGIN PGP SIGNATURE----- Version: 2.3a iQCVAgUBK1MJWE5ULTXct1IzAQG8cgQAtZ5xbIn6wO/GkjVd68hPe+37Sj4C3uD1 eI2YEUodHRzPC5on4hoHs+AeTtGR132Bcr76oj366cvJF42YqtaZt/4xWKaN+QKJ 5xMJS4qjQorGQw9fxAPjERJ9O+WCgFYn1vNDGnsn4+HGC4Ax/CevQdtBlt2sBlMc SUWGU1GdSkM= =Fyuc -----END PGP SIGNATURE-----

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Re: underground industry
by wcs＠anchor.ho.att.com 17 Dec '03

17 Dec '03

My three guesses about cash business in New York had been - retail pharmaceuticals :-) - politics - garment industry all of which have traditionally been off-the-books to large extent. A friend of mine in NJ had for quite a while been a bookkeeper at small companies that typically would only hire her under the condition that she was off-book, and therefore not getting Social Security, etc. For many companies, though, hiring people off-book is a problem, because their income is relatively traceable, and they get taxed on the difference between income and expenses, and payments to suppliers also tend to be traceable because otherwise the IRS won't allow them. If you can make your income look lower, by not reporting cash income, it's not a problem, but otherwise you want the expenses to look high, and non-reporting suppliers aren't as willing to deal with customers who have to report transactions. Another set of trqaditional off-books cash work is the manual labor market - house cleaners, yard work, odd jobs, evening carpentry; a number of politicians have been getting stung on these recently. Bill

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NOTICE: John Perry Barlow, MBONE, 9:00 AM - 10:30 AM PST, Jan 17, 1994
by Stanton McCandlish 17 Dec '03

17 Dec '03

John Perry Barlow will deliver the keynote address opening the winter USENIX conference at the San Francisco Hilton, Jan 17-21, 1994. The keynote will be broadcast (audio and video) on the Internet MBONE from a bit after 9:00 AM to 10:30 AM PST on Monday, January 17. Barlow will speak on recent developments in the national information infrastructure, telecommunications regulations, cryptography, globalization of the Net, intellectual property, and, generally, of the settlement of Cyberspace. In 1990, Mr. Barlow and Mitch Kapor co-founded the Electronic Frontier Foundation, and he currently serves as chair of its executive committee. <thanks to Evi Nemeth, evi(a)piper.cs.colorado.edu> -- Stanton McCandlish * mech(a)eff.org * Electronic Frontier Found. OnlineActivist F O R M O R E I N F O, E - M A I L T O: I N F O @ E F F . O R G O P E N P L A T F O R M O N L I N E R I G H T S V I R T U A L C U L T U R E C R Y P T O

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Brock Meeks summary of Gore speech
by Stanton McCandlish 17 Dec '03

17 Dec '03

[This report from Brock Meeks first appeared on the WELL, and is redistributed with permission. Further redistribution/republication should be cleared with the author first, at brock(a)well.sf.ca.us.] __________ begin forward _____________ Jacking in from the Policy port: Vice President Gore today outlined the Administration's plan for revamping the regulatory regime that will guide the converging telecommunications industry into the next century. Gore said the Administration will propose lifting all restrictions on local telephone companies imposed during the breakup of AT&T, allowing them to enter the long distance and manufacturing markets. But buried deep in his speech, in a single ominous sentence, Gore made a pledge that is sure to a chill into privacy advocates everywhere: "We'll help law enforcement agencies thwart criminals and terrorists who might use advanced telecommunications to commit crimes." In laymen's terms: We're fucked. Gore didn't elaborate on his statement, but his comment hinted that the White House will throw its full behind two of the most controversial policies the Clinton Administration inherited from the Bush presidency: The FBI Digital Wiretap Proposal and the so-called "Clipper Chip," government mandated encryption program. Both policies have been publicly trashed by the computer and telecommunications industry as well as civil liberty groups. The White House is currently working to overhaul the entire U.S. security policy. Earlier this year, in a little noticed speech, FBI Dir. Freeh renewed his push for the ill-conceived Digital Wiretap proposal. It now appears that the White House will back that proposal when it issues new security guidelines due sometime in the Summer. Changing the Playing Field ========================== Gore also challenged the nation to bring every classroom and library online by the year 2000. He outlined 5 broad principles for restructuring the telecommunications industry, leading to a National Information Infrastructure: -- Encourage private investment -- Provide and protect competition -- Provide open access to the network -- Avoid creating information "haves" and "have nots" -- Encourage flexible and responsive government action Gore said the Administration's plan would "clear from the road the wreckage of outdated regulations and allow a free-flowing traffic of ideas and commerce." Administration plan would allow telephone companies to get into cable business and let cable companies into the telephone business, preempting state regulations that for the most part ban such businesses. Although the White House plan allows local telephone companies to provide video, they must also allow any programmer access to those video delivery systems on nondiscriminatory basis. The plan also seeks to stop telephone companies from buying cable systems in the areas where they offer telephone service. But the plan also gives the FCC the authority to revamp that rule within 5 years if "sufficient competition" has risen. The plan also would implement a new flexible regulatory regime called Title VII that encourages firms to provide broadband, switched digital transmission services. Like the Cable reregulation act, the FCC will have the ability to provide for rate regulation on these new companies until "competition is established." One of the trickiest issues facing the Administration was how to define and ensure the concept of Universal Service. The White House plan proposes to make that policy "an explicit objective the Communications Act" in order to make sure that advanced information services are available to rural and low-income urban areas. But the Administration bailed on how to insure the concept, opting to lay that burden at the feet of the FCC. Also, all telecommunications providers, not merely telephone companies as is the current policy, will have to start contributing to universal access subsidies. But the FCC will be responsible for determining a kind of "sliding scale" for how much each company will be required to pay. In fact, if smaller firms can't pony up the cash to help out with the universal service commitment, they can make "in-kind" contributions instead. This might be in the form of free service to school, hospitals, etc. Meeks out.... __________________ end forward ____________ -- Stanton McCandlish * mech(a)eff.org * Electronic Frontier Found. OnlineActivist F O R M O R E I N F O, E - M A I L T O: I N F O @ E F F . O R G O P E N P L A T F O R M O N L I N E R I G H T S V I R T U A L C U L T U R E C R Y P T O

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