December 2003 - cypherpunks-legacy

New admin crypto policy
by nobody＠huge.cajones.com 17 Dec '03

17 Dec '03

It is time something unfortunate happened to all those leading the push for new crypto limits.

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FC: Tax the Net! Report from Capitol Hill...
by Declan McCullagh 17 Dec '03

17 Dec '03

************ Date: Fri, 9 May 1997 21:57:45 -0400 To: fight-censorship-announce(a)vorlon.mit.edu From: Declan McCullagh <declan(a)well.com> Subject: FC: Tax the Net! Report from Capitol Hill... Sender: owner-fight-censorship-announce(a)vorlon.mit.edu Reply-To: declan(a)well.com X-FC-URL: Fight-Censorship is at http://www.eff.org/~declan/fc/ So I'm sitting in this rundown basement meeting room in the Rayburn House office building listening to a bunch of DC policy wonks spout off about Internet taxation. Too bad I'll have to wait to get back to the bureau to log in. Gotta get Strosser in Purchasing to get me that radio modem. It'll be great for playing networked Quake when Senate Judiciary hearings are yawners. Bruce Cohen from the Treasury Department is speaking. Horn-rimmed glasses, nondescript blue suit, definitely a geek. Tries a joke: "I hope there are no criminal tax evaders in the audience." It flubs; folks glance at each other nervously. I lean over to the guy from Cox's office next to me and whisper, "I guess that's IRS humor." He deadpans, "For what it's worth." Cohen is praising a Treasury Department white paper released last fall that says basically "No New Net Taxes." That's true. But you have to read the fine print. Which I did. That's where one finds the very clear suggestion that existing tax laws must be extended to encompass the Internet -- in the kind of clumsy and misinformed way that has typified federal forays into legislating online behavior. "We have a tax system based on a 19th century model of industry," Cohen continues. "Cash poses problems for cash administrators. Electronic cash poses additional problems." It does. The guy from IBM admitted a couple minutes ago that if I buy _physical goods_ over the Net and have 'em shipped to my zip code (20036), then the usual taxes should apply. Just like mail order. But problems arise when the product sold is virtual. If I buy a copy of an email program from Poland, pay for it with digital cash from an Amsterdam bank, and get a partial refund from a firm in Singapore, which government taxes what? No wonder the Internet Caucus decided to organize today's luncheon. Everyone on the Hill's still scratching their heads. Now Americans for Tax Reform's Jim Lucier (a longtime f-c subscriber) is at the podium. He recommends "reengineering the tax code" to address some of the unique aspects of the Net. A steely silence descends on the room. Okay, that ain't gonna happen. Too bad. Lucier is one of the few folks in the room who has a clue about the Net. To be sure, cypherpunks have anticipated these regulatory problems for years. I remember Lucky Green, a digital cash guru and veteran 'punk, stopping by my apartment last summer. Over beers, we talked crypto-anarchy: as more and more transactions move online, as more folks become "knowledge workers," as they get paid in foreign e-cash for writing or hacking code, the Feds' ability to tax income (and virtual spending) will suffer. But that doesn't mean taxes disappear. (Yeah, I know. What a shame.) Governments always will be able to tax physical purchases and meatspace property. When I buy a loaf of bread at my favorite organic grocery down on Columbia Road, the Man can monitor the grocer to ensure he reports the transaction. Or property taxes: governments will always be able to extract 'em. Taxes will shift from income to sales and property. Things are winding down. Aaron from White's office is asking for questions. Embarassed silence. Nobody asks any. Is it because nobody understands the stuff or because everybody understands the stuff? Time passes. Yep, the silence is definitely caused by nobody wanting to sound stupid. Aaron gives up. The panelists get to ask each other questions instead. Lucier starts rambling about the economics of tax policy, but nobody can understand, so we all ignore it. Then Mark Rhoads, the guy supposedly representing the state legislators, stands up. He says the only funny thing of the afternoon: "I worked for Dirksen when he wasn't a building." Or something like that. Maybe you had to be there. Anyway, he doesn't like the Cox-Wyden bill that would prevent states from taxing the Net: "I'll give you a nightmare scenario. What if you had a garage sale and invited 80 million people to your garage sale. I happen to be a collector of antique plates. The efficiency the Internet creates allows me to find people. The complications involved in taxing that at either the federal or state level are amazing." Anyone want to bet that's going to stop 'em from trying? -Declan ------------------------- Declan McCullagh Time Inc. The Netly News Network Washington Correspondent http://netlynews.com/ -------------------------------------------------------------------------- This list is public. To join fight-censorship-announce, send "subscribe fight-censorship-announce" to majordomo(a)vorlon.mit.edu. More information is at http://www.eff.org/~declan/fc/

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Intel for the War Underway
by John Young 17 Dec '03

17 Dec '03

The May 10 Economist has a special survey of global electronic commerce. It's a timely piece of battlespace intelligence for Tim's "war underway." It pinpoints financial soft target CyberPromos receiving favorable crypto treatment by the world's governments to manage the Net. Eric Hughes is featured in its analysis of the birth or death struggle of digital cash -- the key battle, if you will, of breaking the global banks and ranks of centralized information. A battle underway in the US by the TLAs, the Key Recovery Alliance and the ABAs of the banks and the lawyers aiming for supremacy -- domestic and global -- by managing ever-thinning wallets.

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Kerrey's Crypto Bill
by John Young 17 Dec '03

17 Dec '03

Thanks to Declan McCullagh we offer Senator Kerrey's outline of his encryption bill, The Secure Public Network Act: http://jya.com/tspna.htm (12K)

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Re: FCPUNX:List of GAK supporters
by jamesd＠echeque.com 17 Dec '03

17 Dec '03

At 08:01 PM 5/7/97 -0700, Lucky Green wrote: > Below is a list of the members of the "Key Recovery Alliance" who are > working hard to make the world safe for GAK. Strikingly absent from the list are Microsoft, Netscape, and Intel. Strikingly present on the list is RSA and McAfee. --------------------------------------------------------------------- | We have the right to defend ourselves | http://www.jim.com/jamesd/ and our property, because of the kind | of animals that we are. True law | James A. Donald derives from this right, not from the | arbitrary power of the state. | jamesd(a)echeque.com

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Bill of Goods, from The Netly News Network
by Declan McCullagh 17 Dec '03

17 Dec '03

************ http://pathfinder.com/netly/editorial/0,1012,931,00.html The Netly News Network http://netlynews.com/ May 9, 1997 Bill of Goods by Declan McCullagh (declan(a)well.com) Senate Democrats are preparing legislation that requires universities and other groups receiving Federal grants to make their communication networks snoopable by the government, The Netly News has learned. The draft also includes penalties for "unauthorized breaking of another's encryption codes," and restrictions on importing encryption products. At a Democratic leadership press briefing, Sen. Bob Kerrey (D-Neb.) yesterday said his bill slightly relaxed export rules in exchange for greater federal control over crypto imports. But what he appears to be truly aiming for is a full-scale assault on your right to use whatever encryption software you want in your own home. Academics are indignant over the strings attached to grants. "This is outrageous," says Dave Farber, a university professor at the University of Pennsylvania and an EFF board member. "It's going to generate roaring screams on campus. If you look at Internet II, if you look at the Next Generation Internet, if you look at campus networks -- all those have components of federal funds." It's diabolical. Researchers already have to comply with a legion of rules to qualify for grants. Kerrey's proposed bill, called "The Secure Public Network Act," would add yet another provision to the fine print. It requires that "all encryption software purchased with federal funds shall be software based on a system of key recovery" and "all encrypted networks established with the use of federal funds shall use encryption based on a system of key recovery." Key recovery, or key escrow, technology enables law-enforcement officials to obtain copies of the mathematical keys needed to decipher messages. In other words, someone else keeps a copy of your secret key -- and some proposed bills say that the cops may not even need a search warrant to seize it. And not just universities will be jump-starting the market for domestic key escrow. Organizations from defense contractors to the United States Institute of Peace to the American Red Cross receive federal monies. "This is out-and-out industrial policy," says Jim Lucier of Americans for Tax Reform. "It's going to affect every technology there is for doing business on the Net." What about the penalties for "unauthorized breaking of another's encryption codes?" That would criminalize cryptanalysis, the way to verify the security of encryption software you buy. "The only way to know the strength of a cipher is cryptanalysis," says Marc Briceno, a cryptography guru at Community ConneXion. Then there's Kerrey's statement saying "there will be" restrictions on what encryption products you're permitted to buy from overseas firms. This contradicts Justice Department official Michael Vatis, who told me at a conference this year that the Clinton administration did not want import controls. Though Cabe Franklin, spokesperson for Trusted Information Systems, says Kerrey was misunderstood. "In the briefing afterwards, I found out he didn't mean that at all. He meant import controls, but more regulation than restriction. The same way they wouldn't let a car with faulty steering controls in the country. He meant more quality control," Franklin says. (I don't know about you, but I'm not convinced.) But the real question is: Why does Kerrey think this rat-bastard bill has any chance of passing through Congress, especially when there's already legislation that would generally relax controls on crypto? After all, Rep. Bob Goodlatte (R-Va.)'s "SAFE" bill already has 86 cosponsors and shot out of subcommittee last week. Sen. Conrad Burns' (R-Mont.) "Pro-CODE" bill is headed for markup next month. The answer is simple: this a trading chit that the White House and the Democratic leadership can play to water down the Burns and Goodlatte bills, and perhaps meld all three together. The Democratic strategy makes sense. Members of Congress are driven by a fierce, desperate urge to compromise. The drive is primal: legislators are compelled to find a middle ground. But to their chagrin, crypto doesn't offer one. Either you keep a copy of the electronic keys to your files or someone else does -- which is exactly what the White House wants. Either you're free to speak privately over the Net using PGP, or you're not -- which is exactly what the White House also wants. This may seem like a lot of high-powered attention on an obscure subject; after all, encryption does nothing more than scramble, verify and reassemble bits of information. Besides ensuring that your messages are private, encryption provides the protocols for scrambling credit card numbers and minting electronic coins. It allows digital signatures, proofs of identity online, digital time stamps and even secure electronic voting. It lets anonymous remailers exist. It supplies the foundation and steel girders for an information society. Kerrey's sudden interest in cryptologic arcana likely stems from a recent addition to his staff: policy aide Chris McLean. McLean is hardly a friend of the Net. While in former Sen. Jim Exon's (D-Neb.) office, McLean drafted the notorious Communications Decency Act and went on to prompt Exon to derail "Pro-CODE" pro-encryption legislation last fall. Then, not long after McLean moved to his current job, his new boss stood up on the Senate floor and bashed Pro-CODE in favor of the White House party line: "The President has put forward a plan which in good faith attempts to balance our nation's interests in commerce, security, and law enforcement." Now, more ominously, McLean just might be Bill Clinton's appointee to fill a vacant slot at the Federal Communications Commission. If you think the White House is out to slam the Net, imagine what the FCC could do... ### ------------------------- Declan McCullagh Time Inc. The Netly News Network Washington Correspondent http://netlynews.com/

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Security flaw in key recovery -- you're looking at it
by nobody＠huge.cajones.com 17 Dec '03

17 Dec '03

Date: Fri, 9 May 1997 14:34:01 -0700 Subject: Security flaw in key recovery -- you're looking at it awww ... go ahead, show us!!!! Otherwise, I just might not believe you. [This is only a test. If I had been in a bad mood, this message would have contained the private key of the CEO of a major Entrust customer, obtained from an Entrust trusted "key safe" server. Who am I? Can Entrust or its customer's officers finger me?]

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Re: New admin crypto policy
by nobody＠huge.cajones.com 17 Dec '03

17 Dec '03

Tim May wrote: > > At 9:24 PM -0800 5/9/97, Huge Cajones Remailer wrote: > >It is time something unfortunate happened to all those leading the push > >for new crypto limits. > > You mean like attaching a new Ryder to the bill? > > --Tim McVeigh, er, May The story so far: Mr. Nobody sends a message to the cypherpunks list via an anonymous remailer suggesting that someone ought to fuck with Cyberpromo. Cyberpromo gets fucked with shortly thereafter. Mr. Nobody sends a message to the cypherpunks list suggesting that it's time for something unfortunate to happen to those leading the push for new crypto limits. Perhaps someone should start a betting pool to guess whether the spooks are taking aim at the remailers or if they are setting up a particular cypherpunk, instead. We could start a betting pool to guess who will shortly have something "unfortunate" happen to them, but that might get the winner in a lot of trouble. TruthMcVeigh

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by Mercury Messenger Services 17 Dec '03

17 Dec '03

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Now read the Interactive Journal without Logging In
by WSJ Interactive Edition Editors 17 Dec '03

17 Dec '03

We're delighted to announce that we've implemented one of the most frequently requested enhancements to The Wall Street Journal Interactive Edition: The ability to store your User Name and Password, so that you don't have to manually enter it each time you visit. Just ask for any Interactive Journal page, and when prompted for your User Name and Password, check the "Save your Sign-On" box on the login screen. >From then on, you can read the Interactive Journal without the extra step of signing on each time. You can turn this feature off at any time if you wish by visiting Your Account, located at the bottom of any Interactive Journal page. Also, if you access our pages using multiple computers, you'll need to automate your sign-on separately for each configuration. (And remember that this means anyone with access to your computer will be able to read the Interactive Edition using your account.) We hope this makes it much easier for you to read the Interactive Journal and that you'll let us know your reactions and suggestions. Best Regards, Neil Budde Editor inquiries(a)interactive.wsj.com _______________________________________________________________ Check out Small Business Suite, a new Interactive Edition feature covering issues that matter most to small business owners, entrepreneurs, and anyone who markets products or services to small businesses. http://wsj.com/edition/current/summaries/small.htm ________________________________________________________________ This is the New Features Alert e-mail list. If you do not wish to continue to subscribe to this list, sign on to The Wall Street Journal Interactive Edition and go to the following URL: http://wsj.com/user-cgi-bin/userMenu.html to change your account preferences. Or you can just send email to: stopmkt(a)lists.wsj.com Cancelling your subscription to The Wall Street Journal Interactive Edition will automatically un-subscribe you from any e-mail lists you might be subscribed to through our service. For further questions, please call our customer service department at 1-800-369-2834. __________________________________________________________________

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