US News & World Report Copyright, 1994, U.S. News & World Report All rights reserved. U.S.NEWS & WORLD REPORT, MARCH 14, 1994 DECODING THE ELECTRONIC FUTURE By Vic Sussman WILL ENCRYPTION SECURE OR DENY PRIVACY RIGHTS? Would you hand over a spare set of house keys to your local police to help them fight crime, trusting that they would never enter your home without good reason? According to opponents of the so-called Clipper chip, a powerful new telecommunications encoding device, that is an apt metaphor for what the White House, the FBI and the supersecret National Security Agency are asking of a gullible American public. Clipper backers insist the innovation will not only help in an increasingly desperate fight against crime but actually give Americans more privacy than ever. The Clipper controversy--which has sparked frenzied debate and angry protests in recent weeks--swirls around a small sliver of silicon that can be built into telephones. Ordinary phones can be tapped with anything from cheap scanners to quaint-tech alligator clips. But Clipper phones use encryption technology to scramble voice, fax, electronic mail and other data transmissions into digital gibberish. Only other Clipper phones can unscramble the information, which makes the Clipper an untappable system. Well, almost. A phone that can't be tapped is every cop's nightmare, because anyone from drug traffickers to terrorists would be able to scheme and plot with impunity. So under a plan hatched by the NSA and backed by the White House, government agents would be able to unscramble Clipper's secret code by using two mathematical keys. To guard against abuse, the keys would be held by two government agencies. Authorities would first have to get a warrant--standard wiretap procedure--before obtaining the decoders. Key escrow, as it's called, may sound good on paper, but critics maintain it will be both invasive and ineffectual. In addition, Democratic Sen. Patrick Leahy of Vermont maintains that Clipper is a ``misstep in export policy.'' U.S. companies would have a tough time selling compromised telecommunications products overseas and consequently would have to manufacture both domestic and foreign versions, an expensive proposition. IBM, Apple, Microsoft and the Software Publishers Association, among many others, oppose Clipper. Leahy's Technology and the Law Subcommittee is planning March hearings on these issues. HISTORY'S SHADOW. Critics are also doubtful that Clipper's decoding keys will be sufficient to deter government recklessness, pointing to past abuses by the FBI, NSA and CIA. But Georgetown University computer scientist Dorothy Denning contends that much more stringent controls against illegal eavesdropping exist today. ``The greater danger,'' she insists, ``is losing the ability to wiretap, giving organized crime and terrorism the advantage.'' Law enforcement authorities also say they are looking for no more authority than they already have--to make lawful requests to have the telecommunications industry cooperate in crime prevention. But Marc Rotenberg, Washington director of Computer Professionals for Social Responsibility, a public-interest group that has collected more than 50,000 signatures on an anti-Clipper petition, doesn't buy that argument. In fact, he says, the government has admitted the system could be easily breached by the NSA, which wouldn't need a warrant if it made its demand under the rubric of national security. Many valid concerns about Clipper, says Rotenberg, ``are similarly dismissed with the claim of national security, a dangerous way to design our civilian communications infrastructure.'' The Clipper chip has been proposed as a voluntary standard. But once the Internal Revenue Service, the Pentagon and other agencies order tens of thousands of Clipper phones, it will be impossible to do government business using any other equipment. Indeed, the biggest fear raised by Clipper is that it is the digital camel's nose under the electronic tent. Another White House proposal, for instance, would require that all future telecommunications systems--everything from phones to online services--be ``wiretap friendly,'' says Jerry Berman, executive director of the Electronic Frontier Foundation. Even the most vociferous Clipper opponents concede a legitimate need for electronic surveillance, but many would like to see Congress rather than agencies like the NSA determine the proper balance of government needs and individual rights. Cliff Stoll, whose book THE CUCKOO'S EGG focused attention on computer espionage, thinks the Clipper controversy is overblown by both sides. In fact, he contends, the typical telephone or computer user doesn't need any encryption more powerful than pig Latin. Erhaps-pay.