The Washington Post, March 11, 1996, p. A18. Security and Software [Editorial] The number of computer users continues to grow, but use of the Internet for business and financial transactions isn't keeping pace. At least, that's the complaint of many who expected a flood of Americans to go on-line for banking, publishing and mail-ordering -- with tremendous profits to the on-line industries that handle these services. One big reason for the lag is customer concern about the safety of information, from credit-card numbers to bank balances and business secrets, in the hacker-rich environment of the Internet -- an eminently reasonable concern that many in the industry believe can be addressed only by the wider use and availability of sophisticated "encryption software," which scrambles information en route, making it indecipherable to anyone who doesn't hold the key to the code. The sense that encryption technology holds the key to future economic growth on the Internet is pushing an arcane but intense argument between the Clinton administration and the computer industry over whether to lift existing restrictions on the export of the most powerful encryption software. The administration, especially its law enforcement agencies, bars on national security grounds the export of encryption software above a certain difficulty level, saying that it needs to be able, if neqessary, to seek and obtain the equivalent of a permit to wiretap. The makers of the software argue that these restrictions are ruinous for U.S. competitiveness in the international market because foreign customers want the most secure encryption available. Some civil liberties organizations argue that the restrictions are an invasion of customers' privacy rights. Legislation introduced this month in both the House and the Senate would ease the export restrictions while attempting to meet some of the government's security concerns. Code makers would deposit a "spare key" to any exported encryption software with a trusted third-party agency -- a compromise the Justice Department and national security agencies also have been pursuing in talks with the industry, but at which the industry hesitates because it fears that the existence of "spare keys lying around" would cause potential customers to balk. (The Justice Department also would like a spare-key agreement for encryption software sold domestically, but has less leverage because such sales require no license.) The legislation would heavily penalize any "key holder" agency that provides an unauthorized copy to anyone besides the government. But it also would make it legal to export any encryption technology that is already "generally available" -- for instance, in stores or on domestic computer bulletin boards. Such a sweeping change, law enforcement authorities fear, could render the other barriers and safeguards in the bill close to academic in the borderless, lightning-quick world of Internet transmission. Once it's widely available overseas, "uncrackable" software or hardware can't be recalled. The U.S. intelligence agencies with their superior computing power can still crack most coded software, if not immediately, then much faster than 99.9 percent of ordinary commercial hackers. But that doesn't mean their concerns should be shrugged off. Like arms sales, encryption technology sales have implications for traditional national security interests as well as the economic kind. The urgent interest both sides share is to get this resolved soon. [End]