As Dot-Coms Go Bust in the U.S., Bermuda Hosts a Little Boomlet
As Dot-Coms Go Bust in the U.S., Bermuda Hosts a Little Boomlet By MICHAEL ALLEN Staff Reporter of THE WALL STREET JOURNAL HAMILTON, Bermuda -- Operating out of a hurricane-proof command center in a former U.S. military base, Paven Bratch is a tax examiner's nightmare. Although his Internet company, music and video merchant Playcentric.com (www.playcentric.com1), has just 10 employees, didn't go live until September and has yet to turn a profit, it has the structure of a major multinational. Its computer servers are located here, its operating unit is in Barbados, and it has a distribution deal with a big record-store chain in Toronto. The 36-year-old Mr. Bratch figures this setup will save him so much on corporate income taxes and other expenses that he'll be able to undercut Amazon.com Inc.'s prices by more than 45% and still make a bundle. "One thing that always amazes me is, why would anyone who's planning on generating a profit locate themselves in a full-tax jurisdiction?" he says. 'First Generation' Plenty of dot-coms are asking themselves the same question these days. Undaunted by their industry's growing ranks of flameouts and hoping to emerge as one of the profitable few, dozens of them are popping up in tax havens around the world. In Bermuda, they range from tiny publisher ISI Publications Ltd., which sells hard-to-find business books under the domain name Booksonbiz.com (www.booksonbiz.com2), to E*Trade Group Inc., the big online stockbroker, which is locating its international trading operations here. Further south, on the Caribbean island of Antigua, an American trader has set up Indextrade.com (www.indextrade.com3) to allow small investors to bet on swings in market indexes, while in Cyprus, a former British jazz singer is doing a brisk business by listing vessels such as a Soviet-era submarine on Ships-for-sale.com (www.ships-for-sale.com4). "These merchants are the first generation who can really domicile anywhere, " says Andrea Wilson, chief executive of Bermuda-based First Atlantic Commerce Ltd. (www.firstatlanticcommerce.com5), which provides credit-card payment systems for e-businesses. "They can be a virtual corporation if they choose." The trend started with Internet gambling companies, which fled to the Caribbean to avoid the long arm of U.S. law. But now, thanks to an explosion of new telecommunications links to places such as Bermuda and Britain's Channel Islands -- and an ambitious push by promoters in such countries as Panama to set up facilities capable of hosting hundreds or thousands of Web sites each -- more-legitimate Internet companies are starting to make the leap offshore. A Wealth of Ambiguity There are serious questions about whether some of the structures would pass muster with the Internal Revenue Service and its foreign counterparts. But many accountants figure there's enough ambiguity in the industrial world's offshore tax codes that e-commerce companies could, at least theoretically, rack up tax-free profits for years before the authorities sort things out. The issues are often murkier than for a standard offshore tax shelter, because they involve technological innovations that the U.S. Treasury couldn't have anticipated when it began laying the ground rules for offshore taxation in the 1960s. For instance, nobody's entirely sure how to tax the earnings of a programmer who sells his software by allowing buyers to download it from a Web site hosted on a computer server in a zero-tax jurisdiction. Some tax attorneys take the position that the sale takes place where the server is located, and that the business owes no corporate or sales tax in the buyer's home country. "It would be no different than you or I getting on a plane, flying to the Bahamas, and buying a T-shirt in the hotel," says Lazaro Mur, a Miami tax attorney. New telecommunications options have brought Bermuda and much of the Caribbean even closer than a plane ride away. Cable & Wireless PLC's phone monopoly among former British colonies in the region is breaking up, and C&W's new competitors are starting to lace the seabed with modern fiber-optic lines, breaking down old technological barriers to working offshore. At the same time, so-called server farms -- warehouses built to accommodate row upon row of computer servers -- are sprouting up to accommodate high- tech newcomers. At Fort Clayton, a former U.S. military base in Panama, local entrepreneurs plan to open a 50,000-square-foot "high-tech hotel" later this month they say will be capable of hosting as many as 1.2 million Web sites. HavenCo, a self-proclaimed "data haven," announced plans last year to host Web sites from an antiaircraft platform abandoned by the British after World War II. The North Sea platform has a colorful history: In 1966, a retired British army major seized control of it and has operated it for years as the sovereign "Principality of Sealand." Ryan Lackey, HavenCo's chief technical officer, says the company, which spent the summer upgrading electrical power and air conditioning on Sealand, has more than 30 servers up and running, connected to the mainland by satellite and wireless service, and hopes to expand to as many as 5,000. He says the company has fielded "several thousand" sales inquiries. "The big thing people really want is e-mail servers, because in the past people have been getting their e-mail servers subpoenaed," he says. He adds that HavenCo would only comply with subpoenas issued by the Court of Sealand. "But there's no Court of Sealand, so it's very unlikely." Tax savings are the big selling point for many of the installations. "Offshore + Ecommerce=Tax Free Heaven," screams a banner ad for Bahamas.net, which offers server facilities in the Bahamas for as low as $2,200 a month. Bermuda, which has a rich history of helping foreigners shave taxes, also is doing its best to encourage the migration offshore. Its two biggest banks, Bank of Bermuda Ltd. and Bank of N.T. Butterfield & Son Ltd., have launched major e-commerce initiatives, establishing systems to allow online merchants to bill customers in several major currencies. A common refrain among business leaders on this tiny fishhook-shaped island is that Bill Gates would be a much-richer man today if he had originally established Microsoft here. The pitch helped reel in Robert Edwards, an editorial cartoonist who lives in Canterbury, England. Not long ago he went looking for help in setting up a Web site to sell works by him and about 30 other artists from around the world. Tipped off to Bermuda by a visiting delegation of businesspeople, he registered his company online through Appleby, Spurling & Kempe, a local law firm here, and was quickly directed to Web designers, a hosting site and a credit-card intermediary, First Atlantic. Late last year, at a total cost of less than $200,000, his Drawnandquartered.com (www.drawnandquartered.com6) went live, offering 4,000 artworks, which can be downloaded online with a credit card, for $200 and up. His company doesn't pay any income or sales taxes, and he only has to pay personal-income tax on the salary he draws. "I'm a perfect example of how it can be done," he says. Playcentric's Mr. Bratch, a former Procter & Gamble Co. manager, says he relied on advice from an international tax attorney in structuring the online retailer, which will market its compact disks, videos and DVDs partly through packaged-goods makers who want to reward loyal customers. Mr. Bratch, a Canadian citizen, put his operating unit in Barbados, which, unlike Bermuda, has a tax treaty with Canada, in order to take advantage of the Caribbean nation's corporate income-tax rate of just 2%. He says he located his computer operations in Bermuda because of its extensive banking and telecommunications infrastructure. Its attractions include a state-of-the-art server facility built in an old U.S. naval base by 360networks Inc.'s TeleBermuda International unit, which laid an undersea fiber-optic cable to the U.S. in 1997. Tax considerations also helped lure Todd Middagh, chief executive of Originals Online Ltd., to Bermuda. His brainchild: a site that will allow importers, exporters and shipping companies to swap legally binding trade documents online, instead of wasting days with couriers. "It's a digital product, global in nature, 24-hours-a-day world-wide," says Mr. Middagh, who has already attracted the interest of several major grain companies, including Archer Daniels Midland Co. "We're going to be in almost every jurisdiction over time," he says. Meanwhile, Mr. Middagh, a native of Canada, will be presiding over the company from his house here, which overlooks the Atlantic Ocean. Scott Rubman, a Long Island, N.Y., real-estate attorney whose family has long been in the fur trade, is putting together Furs.com (www.furs.com7), a Bermuda-based site that plans to match mink farmers in, say, Norway, with fur-coat manufacturers in North America and China. As an American, Mr. Rubman may face a bigger hurdle in shielding any offshore profits from taxation. Unlike many other countries, the U.S. taxes its citizens on their income world-wide. "If you move offshore strictly to evade taxes, that's something the U.S. will always look at," says Mr. Rubman, who is getting plenty of advice from U.S. tax experts. "When you have a legitimate business purpose to transact business offshore, I'd think the U.S. would be supportive of that." And if the U.S. isn't supportive? Cryptographer Vince Cate thinks he has that covered. In 1998, the onetime Carnegie-Mellon University Ph.D candidate walked into the U.S. Embassy in Barbados and renounced his American citizenship, declaring that he was henceforth a citizen of Mozambique, thanks to a document he purchased for $5,000 over the Internet. Then, he went back to the Caribbean island of Anguilla, where he had developed a reputation as a computer-encryption visionary. Among his many ventures, he has taken over the operations of an online marketer of driver's-license information that had run afoul of a new privacy law in Texas. Mr. Cate plans to build the business without paying a cent of taxes. "Because I'm not a U.S. citizen, I'm not in the United States, and Anguilla has no taxes, I don't believe I have any problem," he says. Write to Michael Allen at mike.allen@wsj.com8
mean-green@hushmail.com posted:
As Dot-Coms Go Bust in the U.S., Bermuda Hosts a Little Boomlet By MICHAEL ALLEN
[...]
Plenty of dot-coms are asking themselves the same question these days. Undaunted by their industry's growing ranks of flameouts and hoping to emerge as one of the profitable few, dozens of them are popping up in tax havens around the world.
One of the interesting, and to my mind odd, things is that they *aren't* "popping up in tax havens around the world". They are popping up in little islands that are formally or effectively under British colonial rule, if not actually occupied by the British army. Britain has a good track record of supporting business in its little island colonies & ex-colonies - most notably Hong Kong which at one time had a GDP larger than that of the rest of China by some measures - but does anyone seriously think that if businesses located in those places were ever seen as a threat by the UK government/establishment/military, or by their US handlers, they wouldn't just move in and close them down? Even some of the ex-colonies rely on Britain or (especially in the the Caribbean) the USA for foreign aid and military protection (that could be "protection" as in "protection racket") and their governments aren't in a position to stand up to either the Mother Country or her Bigger Brother. And, on the whole, their ordinary citizens (never mind resident aliens) don't even have the legal rights they would in Britain, and nothing like those of the USA. The very fact that such business are allowed to flourish is a Big Clue that they aren't really causing the US or UK governments any hassle. They are quite happy to have most people at home paying tax & a few overseas not paying tax but doing business. But if they ever really wanted to get an individual or a business, they would. The sun still doesn't set on the British Empire (not while we have Pitcairn!), London is still the heart of darkness, it is is still the place where the money is (most of the money in the world, by orders of magnitude, is in meaninglessly large dollar accounts in databases owned by London banks, representing currency trades), and if you think you can trust these guys to do anything other than act in the interests of their own profits you are making a big mistake. Ken
On Wed, 10 Jan 2001, Ken Brown wrote:
One of the interesting, and to my mind odd, things is that they *aren't* "popping up in tax havens around the world". They are popping up in little islands that are formally or effectively under British colonial rule, if not actually occupied by the British army.
You mean like Belize and it's tax free zones? You're thesis that these small commenwealth countries aren't tax heavens is incorrect. There was an article in Wired just a couple of months ago about two .com dipshits with no clue who were down there trying to make a go of it. ____________________________________________________________________ Before a larger group can see the virtue of an idea, a smaller group must first understand it. "Stranger Suns" George Zebrowski The Armadillo Group ,::////;::-. James Choate Austin, Tx /:'///// ``::>/|/ ravage@ssz.com www.ssz.com .', |||| `/( e\ 512-451-7087 -====~~mm-'`-```-mm --'- --------------------------------------------------------------------
On Wednesday 10 January 2001 05:29, Ken Brown wrote: ...
The sun still doesn't set on the British Empire (not while we have Pitcairn!), London is still the heart of darkness, it is is still the place where the money is (most of the money in the world, by orders of magnitude, is in meaninglessly large dollar accounts in databases owned by London banks, representing currency trades), and if you think you can trust these guys to do anything other than act in the interests of their own profits you are making a big mistake.
Their interests are in making capital grow and prosper. These are diametrically opposed to the interests of high taxation and socialism. I don't think the Bermuda dot-coms are worried about these guys acting in their own interests. I think they are banking on it.... jim -- Sometimes it is said that man can not be trusted with the government of himself. Can he, then, be trusted with the government of others? Or have we found angels in the forms of kings to govern him? Let history answer this question. -- Thomas Jefferson, 1st Inaugural
NY Times has a story today about the offshores being pressured by the big nations to curtail tax evasion and avoidance. The islands first resisted assaults on their sovereignty, but have agreed to do a study of the issue. On a related matter is the likelihood of nations and private interests engaging in cyberwar over who controls financial and perhaps intellectual property resources. Steve Levy last evening said he believes cyberwar is soon to come, and cryptography will play a crucial role, but he said this would be between nations, whereas it is probably more likely that nations, utilizing their combined intelligence and law enforement agencies, will combat private interests not each other, in particular those parties attempting to run financial transactions outside government control. The nations argue they must unite to protect their citizenry against criminal businesses and outlaws, the othe side argues the need to protect government invasion of private affairs. What is lacking in Levy's CRYPTO is that it does not appear to consider that multiple governments will collude against their citizenry, rather than each doing so. Steve at one point cited cypherpunks as a hopeless venture to overturn government with ideas of cryptoanarchy. And laughed at that. Then continued propounding the false idea that NSA is needed to protect US interests. Not a word about such interest being those of the USG. The full story of crypto is yet to be written, in particular its deceptions, perhaps a piece by Vin McLelland, one by Declan, one by Tim May, if not by distributed cyperhpunks not quite so malleable as solo individuals given privileged access on the condition that . . . What about that timing of CRYPTO release and the NSA show?
At 12:22 PM -0500 1/10/01, John Young wrote:
Steve at one point cited cypherpunks as a hopeless venture to overturn government with ideas of cryptoanarchy. And laughed at that. Then continued propounding the false idea that NSA is needed to protect US interests. Not a word about such interest being those of the USG.
The full story of crypto is yet to be written, in particular its deceptions, perhaps a piece by Vin McLelland, one by Declan, one by Tim May, if not by distributed cyperhpunks not quite so malleable as solo individuals given privileged access on the condition that . . .
What about that timing of CRYPTO release and the NSA show?
But, John, weren't you just a week or two ago speculating that the very _origins_ of the Cypherpunks group and list in 1992 had something dark to do with NSA covert ops? As one who was there, at all times, I can most assuredly tell you that neither Eric Hughes nor Hugh Daniel nor Arthur Abraham nor John Gilmore nor Jude Milhon had any links to the NSA or other TLAs. If you knew these folks, you would know, too. As for writing a book, this is for book writers. Remember when Brin's book came out a few years ago? I had some folks in Palo Alto pressuring me to join in on a "collective refutation" of the "bad memes" in Brin's book, with the idea of some kind of speaking tour or counter-book to follow Brin around as a kind of "truth squad." I declined to be part of such a collective effort, because: a) better things to do with my time b) I don't like committee or collective efforts c) no such truth squad would get even a fraction of the "air time" that a published author like Brin would get d) the sheeple really don't care, anyway e) Brin's book would be just another drop in the ocean, anyway. His vision of the future is unlikely in the extreme (t.v. cameras in police offices...sure, whatever), so refuting his "bad memes" is just a waste of time As it happens, I never heard a peep out of this group. Maybe they dropped the idea. Maybe they got no one to sign up for the Anti-Brin Brigade. Maybe they got no press coverage. Who cares, anyway? As for Levy's new book, I've only read parts of it. My copy from Amazon hasn't arrived, so I only checked out a few pages in the local bookstore. What I saw looked accurate. As for his views toward "crypto anarchy," what else would one expect? If the future many of us think is likely is in fact _actually_ likely, then what does it matter whether Levy makes dismissive comments on his book tour or not? I didn't find him making dismissive comments in his book, which is what will be read, anyway. (And even if he did, see previous point...) Look, it was fairly clear to me back in 1987-88 what was going to happen. I have all of my notes from that period, as well as some published essays. Without going into details here, many of the things I thought would clearly happen have _already_ happened. (And, by the way, I made a lot of money by investing in companies based on my expectations.) I've already written a _ton_ of stuff on these matters. Some essays collected into books by others. (Maybe even the new Vinge book, though the editor has been incommunicado with me for three or four years, so I don't even know if my piece will be in the long-delayed re-issue of "True Names.") So count me out on some effort to Write Yet Another Refutation (of a book that doesn't, in my view, need refuting). Others are welcome to. I hear Gary Jeffers is still kicking around, eager to be asked to write such a book. Jim Choate would probably like to be a part of it, too. --Tim May -- Timothy C. May tcmay@got.net Corralitos, California Political: Co-founder Cypherpunks/crypto anarchy/Cyphernomicon Technical: physics/soft errors/Smalltalk/Squeak/agents/games/Go Personal: b.1951/UCSB/Intel '74-'86/retired/investor/motorcycles/guns
Well, yes, I owe the cypherpunks founders an apology, so apology sent. Our rump session after Steve's talk last night, to which he didn't come, put me face to face with 20 nyms and let me tell you online has its virtues -- the main one being never having to have people stare at your TLA forehead mark and you at theirs. Everybody in the room said they're working on a book, really, but what they needed was a writer to burnish the jewels. There was a writer there but incognito, knowing what happens in NYC at any gathering when pols, doctors, lawyers and thieves lock onto someone who has authentic literary skills. Even a total stranger at the bar up front had a story which he said makes the stuff in CRYPTO mere child's play. NSA-trained he claimed to be and a long time battler of corporate evildoing. Great piles of files to prove it, only a ghost writer needed. Now our secret meeting place was in a unisex dormitory building, and this gent was surely trolling with TLA crypto comsec pickup rap. It's as though the whole place was channeling Sandy's natsec-cryptoporn. Confirmed by an attendee who said the Net is dead except for exchanging porn, as in the beginning, as it will ever be. I asked for a copy of his essay, and he said, do you write.
At 1:49 PM -0500 1/10/01, John Young wrote:
Well, yes, I owe the cypherpunks founders an apology, so apology sent.
Our rump session after Steve's talk last night, to which he didn't come, put me face to face with 20 nyms and let me tell you online has its virtues -- the main one being never having to have people stare at your TLA forehead mark and you at theirs.
Everybody in the room said they're working on a book, really, but what they needed was a writer to burnish the jewels. There was a writer there but incognito, knowing what happens in NYC at any gathering when pols, doctors, lawyers and thieves lock onto someone who has authentic literary skills.
Well, I went through my "working on a book" phase in 1988-91, when I was working feverishly for many hours a day on my Great Crypto Anarchic Novel. (At least many of the ideas for the novel turned out to be useful for the Next Phase, which was Cypherpunks.) I, at least, never fell prey to the Usual Malarkey of thinking that all I needed to do was feed some ideas to a Real Writer who would then help me finish it, or collaborate. Fact is, generating a book is hard work. In terms of lining up the publishers, editors, etc. The actual writing may not be too hard, based on some of the fluff I see out there. (Some of the 120-page pieces of fluff by Silicon Valley types, for example, which look like something easily generated by anyone with even modest writing skills. In fact, I'm sure most of these books by Valley CEOs are, naturally, ghost-written.)
Even a total stranger at the bar up front had a story which he said makes the stuff in CRYPTO mere child's play. NSA-trained he claimed to be and a long time battler of corporate evildoing. Great piles of files to prove it, only a ghost writer needed.
See! At least we don't hear this kind of tripe at Bay Area gatherings. People are too aware of how foolish this stuff sounds. --Tim May -- Timothy C. May tcmay@got.net Corralitos, California Political: Co-founder Cypherpunks/crypto anarchy/Cyphernomicon Technical: physics/soft errors/Smalltalk/Squeak/agents/games/Go Personal: b.1951/UCSB/Intel '74-'86/retired/investor/motorcycles/guns
On Wed, Jan 10, 2001 at 10:06:25AM -0800, Tim May wrote:
e) Brin's book would be just another drop in the ocean, anyway. His vision of the future is unlikely in the extreme (t.v. cameras in police offices...sure, whatever), so refuting his "bad memes" is just a waste of time
Right. Everyone's forgotten it; books like that (and Crypto, and Database Nation) have a short half-life.
As for his views toward "crypto anarchy," what else would one expect? If the future many of us think is likely is in fact _actually_ likely, then what does it matter whether Levy makes dismissive comments on his book tour or not? I didn't find him making dismissive comments in his book, which is what will be read, anyway. (And even if he did, see previous point...)
He didn't make dismissive comments, and was actually more critical (though mildly) when we had conversations about it in the past. The thing, though, is that Crypto only spends a paragraph or two -- really -- on crypto anarchy. It's not a focus of the book, or even the chapter, its name notwithstanding. -Declan
At 3:52 PM -0500 1/10/01, Declan McCullagh wrote:
On Wed, Jan 10, 2001 at 10:06:25AM -0800, Tim May wrote:
e) Brin's book would be just another drop in the ocean, anyway. His vision of the future is unlikely in the extreme (t.v. cameras in police offices...sure, whatever), so refuting his "bad memes" is just a waste of time
Right. Everyone's forgotten it; books like that (and Crypto, and Database Nation) have a short half-life.
And of course there are at least a _dozen_ books on the general issue of "privacy." One of the Kennedy's co-authored one (or at least agreed to have her name put on the cover, perhaps). Whit Diffie co-authored one. And so on. A dozen, at least. Nothing new, either. There are even a bunch of recent popularizations of crypto, steganography, PGP, etc. Do they really matter? At the margins, sure. Some kid in junior high school is perhaps discovering Singh's book on "Secret Codes" (or whatever the exact title is) the same way Whit Diffie read one of those early crypto books when he was a kid. Ditto for political books. It's not that I'm jaded, it's that there are TOO MANY DAMNED BOOKS out there. I spend a lot of time in Borders and Bookshop Santa Cruz, two very large and well-stocked bookstores in my town. (Declan can confirm this, though he may not have seen the new Borders yet.) I browse, in the classical sense, the New Books section most times I'm in there. The turnover is incredible. The range of topics is incredible, from climbings of an obscure peak in the Himalayas, to what women want in their sociology classes, to what the AOL-Time Warner deals means for prospects of peace on the Korean peninsula. And, every month, new books on quantum weirdness, new books on online privacy, new books on the history of the Web, etc. A flood of writers, a flood of books. The topics get more specialized in the same way Ph.D. theses have gotten so specialized. The grand unifications are few and far between. Who reads this stuff? We are drowning in a sea of factoids and well-researched books on obscure Beat Generation poets and books on the impact of technology. Big deal. Very few current books actually are _important_. (There are some, IMO. "The Elegant Universe," "Noah's Flood," "Emerging Viruses," in recent years. The novels of Stephenson, Vinge, Gibson, in past years. "Atlas Shrugged," whatever flaws it may have. Etc.) With the reported declines in reading amongst school children (various reasons, from poor schooling to lots of other choices like videos and games), and this explosion of titles, and with bookstores bigger than they ever were when I was a kid....hmmmhhh, lots of interesting forces about to collide. --Tim May -- Timothy C. May tcmay@got.net Corralitos, California Political: Co-founder Cypherpunks/crypto anarchy/Cyphernomicon Technical: physics/soft errors/Smalltalk/Squeak/agents/games/Go Personal: b.1951/UCSB/Intel '74-'86/retired/investor/motorcycles/guns
On Wed, 10 Jan 2001, Tim May wrote:
It's not that I'm jaded, it's that there are TOO MANY DAMNED BOOKS out there. I spend a lot of time in Borders and Bookshop Santa Cruz, two very large and well-stocked bookstores in my town. (Declan can confirm this, though he may not have seen the new Borders yet.) I browse, in the classical sense, the New Books section most times I'm in there. The turnover is incredible. The range of topics is incredible, from climbings of an obscure peak in the Himalayas, to what women want in their sociology classes, to what the AOL-Time Warner deals means for prospects of peace on the Korean peninsula. And, every month, new books on quantum weirdness, new books on online privacy, new books on the history of the Web, etc. A flood of writers, a flood of books. The topics get more specialized in the same way Ph.D. theses have gotten so specialized. The grand unifications are few and far between.
Something in the way you write that reminds me of my brother. He watches Television. He doesn't watch actual shows. He flips to a random channel, watches it for 15-30 seconds, flips to another random channel, watches *that* for 15-30 seconds, repeat for hours... He's not interested in actual shows, but he is fascinated by Television - what kind of images people compose, what kind of ads different channels have, choices in background music and how they've changed over years of soap operas, fashions in body type represented by shows of different eras, etc. It forms some kind of gestalt to him, some fairly sensible idea of how the filters on human experience are and how they've been changing. Me, it just drives bugfuck.
Who reads this stuff?
The literate subsection of society has clearly become more diverse, during the same period in which the aliterate have become less so. This is interesting.
Very few current books actually are _important_.
Perhaps true, but no two people have the same list.
With the reported declines in reading amongst school children (various reasons, from poor schooling to lots of other choices like videos and games), and this explosion of titles, and with bookstores bigger than they ever were when I was a kid....hmmmhhh, lots of interesting forces about to collide.
Collided, I'd have said, in the last ten years. It's just that we can't fully see the consequences yet. Bear
On Wed, Jan 10, 2001 at 12:57:31PM -0800, Tim May wrote:
And of course there are at least a _dozen_ books on the general issue of "privacy." One of the Kennedy's co-authored one (or at least agreed to have her name put on the cover, perhaps). Whit Diffie co-authored one. And so on. A dozen, at least. Nothing new, either.
Yep. That was Caroline Kennedy, I recall. Good review of privacy cases, little on tech stuff. I have probably a dozen privacy books on my bookcases. EPIC publishes a few books (such as their review of privacy regulations) a year.
out there. I spend a lot of time in Borders and Bookshop Santa Cruz, two very large and well-stocked bookstores in my town. (Declan can confirm this, though he may not have seen the new Borders yet.) I browse, in the classical sense, the New Books section most times I'm
Yep. I have been in the new Borders, bought one of this micro-Perl handbooks there. -Declan
At 04:03 PM 1/10/01 -0500, Tim May wrote:
Very few current books actually are _important_.
I've found the following two books to be good reading and even appropriate to this list: The Irish War, Tony Geraghty (c) 2000; and The Story of Magic by Frank Rowlett (c) 1998. _Magic_ is about the career of a high school math teacher who got into crypto under Friedman, before computers. He eventually used them, and there is much discussion about hilariously archaic IBM equiptment, tabulator plugboards, relay circuit design, a whole chapter devoted to building a device that performed autoindexed addressing (without the IBM dudes knowing about it... you're not supposed to hack on the rented stuff..) They were tossing hollerith cards in front of fans to generate randomness. They end up reverse engineering and duplicating a Japanese cipher machine without plans. The book, written from Rowlett's perspective, reads pretty well, better than Kahn. Rowlett describes some of the methods of attack, both pencil and paper and punched-cards; the punch card operations & recipes are fascinating to read about and try to figure out the modern equivalent. It is hard to imagine the tedium that was involved in old cryptanalysis. Obviously you get more out of the book the more you can relate to the problems he faced -perfect for readers here. _Irish War_ is about the past and present north irish independence movement. Its pretty fascinating reading about how the IRA and British continually refined their practices and tools. There's some tech meat about surveillance, running a network, and homemade military tech. The IRA had metalshops to make their own weapons and propellants and explosives, and had made their own recoilless rocket and HEAT warheads. You get the same sense of intricately fucked historical hatreds that you do if you read a brief history of yugoslavia. You learn that the Brit SS set up a clothing cleaning service (p 90) and ran forensic analysis on the collected clothes before cleaning. Shades of the FBI's covert house cleaning service...or Boris's computer repair shop. As a result of the War, North Ireland is set up like a demo room for Louie Freeh's wet dreams. This book might be 'important' for documenting that.
At 12:22 PM 1/10/01 -0500, you wrote:
NY Times has a story today about the offshores being pressured by the big nations to curtail tax evasion and avoidance. The islands first resisted assaults on their sovereignty, but have agreed to do a study of the issue.
1 ) Tax Havens, Wealthy Nations Face Off By REUTERS BRIDGETOWN, (Reuters) - The leader of Barbados, spearheading small nations´ fight against demands from developed countries to reform their offshore financial centers to thwart international tax evasion, proposed on Tuesday setting up a new working group to give all parties a voice in the contentious issue. Date: January 09, 2001 2 ) Parties Agree in Tax Haven Debate By THE ASSOCIATED PRESS ST. MICHAEL, Barbados (AP) -- Leaders of a meeting between wealthy countries seeking to halt tax evasion and small countries with lucrative offshore banking industries said Tuesday that they had made headway toward resol ving their differences. Date: January 10, 2001 Source: AP | Section: World 3 ) Nations Agree to Task Force on ´Tax Havens´ By REUTERS Representatives of wealthy nations and of Caribbean and other small nations branded as "tax havens" agreed on Tuesday to set up a task force to devise ways to reform offshore financial centers used by criminals and tax dodgers. Date: January 10, 2001 Source: The New York Times | Section: World steve
On Wed, Jan 10, 2001 at 12:22:52PM -0500, John Young wrote:
The full story of crypto is yet to be written, in particular its deceptions, perhaps a piece by Vin McLelland, one by Declan, one by Tim May, if not by distributed cyperhpunks not quite so malleable as solo individuals given privileged access on the condition that . . .
True. As a journalist, I do my best to avoid those conditions. I think of them (probably not an original thought) as entangling alliances. I could easily cobble together a book proposal that would include chapters by cypherpunk types; I'd edit. I've been thinking of writing a book for a while -- even had meetings with publishers in '96 -- but it would take too much time. Editing would be far easier.
What about that timing of CRYPTO release and the NSA show?
Ah, it was a lackluster show and not that important. -Declan
At 3:46 PM -0500 1/10/01, Declan McCullagh wrote:
On Wed, Jan 10, 2001 at 12:22:52PM -0500, John Young wrote:
The full story of crypto is yet to be written, in particular its deceptions, perhaps a piece by Vin McLelland, one by Declan, one by Tim May, if not by distributed cyperhpunks not quite so malleable as solo individuals given privileged access on the condition that . . .
True. As a journalist, I do my best to avoid those conditions. I think of them (probably not an original thought) as entangling alliances.
I could easily cobble together a book proposal that would include chapters by cypherpunk types; I'd edit. I've been thinking of writing a book for a while -- even had meetings with publishers in '96 -- but it would take too much time. Editing would be far easier.
I hope you don't do this. There have been several of these kinds of collections--a guy at MIT has done at least a couple of them (I forget his name, though three of my short pieces are in one of his books: the books cost $40-60 or so, for a damned paperback, which is why I don't have my own copy. Even at this high price, they don't pay for submissions and they don't even give out copies to contributors!). What you'd end up with is a printed collection of a bunch of mini-rants or survey articles, whose total verbiage is just a tiny snapshot of the field. There's probably a role for a good book on, say, "digital money," with a mix of overview articles and detailed articles. This would be a _lot_ of work, and the editor would need to be well-versed in the field. But not a book on "Cypherpunk" themes. Too many seemingly-unrelated areas, too much background to cover (ironically, compared to digital money, but I think this is so). And Yog help you if you end up just putting together whatever junky stuff people are willing to submit.
What about that timing of CRYPTO release and the NSA show?
Ah, it was a lackluster show and not that important.
I didn't see it, but I assume it was like most of the past t.v. shows on the NSA and codes and such: Discovery Channel, History Channel, BBC "Horizon," CNN, etc. These shows are easy for producers to put together: lots of shots of radomes and antennas and NSA buildings, a tour of the Cryptologic Museum, some obligatory juicy stuff about Enigma and Turing, interviews with talking heads about the need for blah blah, and so on. Feh. --Tim May -- Timothy C. May tcmay@got.net Corralitos, California Political: Co-founder Cypherpunks/crypto anarchy/Cyphernomicon Technical: physics/soft errors/Smalltalk/Squeak/agents/games/Go Personal: b.1951/UCSB/Intel '74-'86/retired/investor/motorcycles/guns
On Wed, Jan 10, 2001 at 01:11:01PM -0800, Tim May wrote:
I hope you don't do this. There have been several of these kinds of collections--a guy at MIT has done at least a couple of them (I forget his name, though three of my short pieces are in one of his books: the books cost $40-60 or so, for a damned paperback, which is why I don't have my own copy. Even at this high price, they don't pay for submissions and they don't even give out copies to contributors!).
As someone who makes the vast bulk of his income from speaking fees, I wouldn't undertake such a project unless I could pay contributors and get a generous number of copies to hand out. Seems only fair.
There's probably a role for a good book on, say, "digital money," with a mix of overview articles and detailed articles. This would be a _lot_ of work, and the editor would need to be well-versed in the field.
Yep, and not something that I'd be that interested in. But a limited focus would be necessary. Maybe something titled "Crypto Anarchy." :) -Declan
At 6:31 PM -0500 1/10/01, Declan McCullagh wrote:
On Wed, Jan 10, 2001 at 01:11:01PM -0800, Tim May wrote:
I hope you don't do this. There have been several of these kinds of collections--a guy at MIT has done at least a couple of them (I forget his name, though three of my short pieces are in one of his books: the books cost $40-60 or so, for a damned paperback, which is why I don't have my own copy. Even at this high price, they don't pay for submissions and they don't even give out copies to contributors!).
As someone who makes the vast bulk of his income from speaking fees, I wouldn't undertake such a project unless I could pay contributors and get a generous number of copies to hand out. Seems only fair.
"Pay contributors"...such a radical, but hokey, concept. Without going into details about my financial situation, the prospect of a dollar a word, or three, or whatever it is publishers typically pay contributors these days, is not enticing in the slightest. The phrase "I don't get out of bed for less than..." comes to mind. A share of the profits might be, though I expect there would be little in the way of profits for a non-bestseller. It's true that I don't get paid a single dime for the things I write for Usenet, or mailing lists, even for the things others choose to include in their books (which I give permission for, when they contact me). But I also don't have a schedule to adhere to, I write about what interests me, and I don't have any obligation to do extensive research of the footnote variety. If someone wants to pay me, say, $10,000 for whatever I can crank out in a couple of days, I guess I'd be willing to contribute something to such an edited book. If rewrites were called for, or more research were to be needed, then I'd want more money. Colin Powell recently got paid $200,000 for a 30-minute off-the-cuff speech on some "why foreigh policy matters" b.s. topic. Of course, it was underwritten by a Lebanese "businessman" said in news reports to have close ties to Syrian intelligence, so do the math. A legal way to buy influence in our strange society. If Colin Powell can give N of these b.s. speeches a year, my thoughts are surely worth $10K for a day or two's worth of writing. Of course, this won't happen. --Tim May -- Timothy C. May tcmay@got.net Corralitos, California Political: Co-founder Cypherpunks/crypto anarchy/Cyphernomicon Technical: physics/soft errors/Smalltalk/Squeak/agents/games/Go Personal: b.1951/UCSB/Intel '74-'86/retired/investor/motorcycles/guns
On Wed, 10 Jan 2001, Tim May wrote:
Colin Powell recently got paid $200,000 for a 30-minute off-the-cuff speech on some "why foreigh policy matters" b.s. topic. Of course, it was underwritten by a Lebanese "businessman" said in news reports to have close ties to Syrian intelligence, so do the math. A legal way to buy influence in our strange society. If Colin Powell can give N of these b.s. speeches a year, my thoughts are surely worth $10K for a day or two's worth of writing. Of course, this won't happen.
The market speaks, your time must not be worth the same as his after all. That must be crushing. ____________________________________________________________________ Before a larger group can see the virtue of an idea, a smaller group must first understand it. "Stranger Suns" George Zebrowski The Armadillo Group ,::////;::-. James Choate Austin, Tx /:'///// ``::>/|/ ravage@ssz.com www.ssz.com .', |||| `/( e\ 512-451-7087 -====~~mm-'`-```-mm --'- --------------------------------------------------------------------
On Wed, Jan 10, 2001 at 03:48:53PM -0800, Tim May wrote:
Colin Powell recently got paid $200,000 for a 30-minute off-the-cuff speech on some "why foreigh policy matters" b.s. topic. Of course, it was underwritten by a Lebanese "businessman" said in news reports to have close ties to Syrian intelligence, so do the math. A legal way to buy influence in our strange society. If Colin Powell can give N of these b.s. speeches a year, my thoughts are surely worth $10K for a day or two's worth of writing. Of course, this won't happen.
Ah, your output for two days is not worth $10K, at least based on a publisher's estimation of market value. Sadly, politics may not be as rewarding as investing. * -Declan * Unless you're Colin Powell
At 10:54 AM 1/10/01 -0600, Jim Burnes wrote:
On Wednesday 10 January 2001 05:29, Ken Brown wrote: ...
The sun still doesn't set on the British Empire (not while we have Pitcairn!), London is still the heart of darkness, it is is still the place where the money is (most of the money in the world, by orders of magnitude, is in meaninglessly large dollar accounts in databases owned by London banks, representing currency trades), and if you think you can trust these guys to do anything other than act in the interests of their own profits you are making a big mistake.
Their interests are in making capital grow and prosper. These are diametrically opposed to the interests of high taxation and socialism. I don't think the Bermuda dot-coms are worried about these guys acting in their own interests. I think they are banking on it....
Published Wednesday, Jan. 10, 2001, in the San Jose Mercury News WORLD NEWS offshore banking Developed nations pushing to get rid of tax havens Wealthy countries aiming to recover billions of dollars lost to offshore tax havens are trying to convince small countries to give up the banking secrecy that has helped their fragile economies survive. Officials from about 40 countries and territories were to reconvene Tuesday in Barbados for a second and final day of discussion about what the Paris-based Organization for Economic Cooperation and Development terms ``harmful tax practices.'' The organization's 30 member nations, which include the world's wealthiest nations, have set up international standards that they want all nations to abide by. Countries that have no taxes or low taxes are being pushed to change their laws steve
At 11:29 AM 1/10/01 +0000, Ken Brown wrote:
One of the interesting, and to my mind odd, things is that they *aren't* "popping up in tax havens around the world". They are popping up in little islands that are formally or effectively under British colonial rule, if not actually occupied by the British army.
The British colonial possessions discussed in the article are, indeed, tax havens and have been described as such by every writer on the topic from the flakiest up to the Economist Intelligence Unit http://store.eiu.com/description/M727des.asp. Red Tony's attempt to corral his colonies has been going on for a few years now. The OECD has gotten into the act with its Financial Action Task Force (http://www.oecd.org/fatf/) handling Money Laundering and the OECD, itself, http://www.oecd.org/daf/fa/harm_tax/harmtax.htm handling what it calls "Harmful Tax Practices". By the latter, it means evil countries that set their taxes too low. It does not mean the harm involved in tax collection itself. The Barbados meeting http://www.oecd.org/media/release/nw00-123a.htm was co-sponsored by the Commonwealth (formerly the British Commonwealth). They released a hopeful closing statement of agreement and cooperation but nothing is likely to come of it since the world's largest tax haven (the US) is never the subject of these talks. After watching these activities since shortly after the US government started to crack down on trusts back in 1962, I have learned to ignore what governments say and watch what they (and the market) actually do. More important than bank secrecy itself is the ability to easily create legal entities. One of the reason that the US is a popular tax haven (for non-US persons) is because it is so easy to create various business and personal entities here. The Net have only made things worse. With a dozen P2P payment intermediaries created in the last 18 months or so and hundreds of online securities brokerages, it's rough for the control forces. DCF ---- "May the Lord enlighten ... the Swiss banks -- that they might uphold justice and preserve the integrity of their own laws and the laws of confidentiality, trust and basic decency between the banks and their clients." Imelda Marcos' Prayer for the Swiss Banks - Manila - Sunday 25 February 1996.
Just to add an interesting experience to this thread, I've flown to Bermuda and to the Cayman Islands (not an attractive place, but great diving). On the flight to Bermuda the in-flight magazine had several articles discussing Bermuda's aggressive moves against being a tax haven. Saw the same kinds of articles in the magazines while on the beach there. In stark contrast, the in-flight magazine to the Caymans had several large advertisements and one govt.-sponsored article promoting the fact that banking transactions of less than $50,000 (per transaction) are never reported to law enforcement inquiries unless it has been adquately proven that the transaction was the result of a drug deal. Other advertisements stated the cost of starting a bank (as little as $5K if I remember correctly) and of starting a private holding company (a little more than starting your own bank). Interestingly none of these islands/countries have the SA (societe anonamie (sp?)) laws of French islands. An SA company by definition never reveals the board members, officers, founders, etc. pz -----Original Message----- From: owner-cypherpunks@Algebra.COM [mailto:owner-cypherpunks@Algebra.COM]On Behalf Of Duncan Frissell Sent: Friday, January 12, 2001 11:04 AM To: cypherpunks@cyberpass.net Subject: Re: Re: As Dot-Coms Go Bust in the U.S., Bermuda Hosts a Little Boomlet At 11:29 AM 1/10/01 +0000, Ken Brown wrote:
One of the interesting, and to my mind odd, things is that they *aren't* "popping up in tax havens around the world". They are popping up in little islands that are formally or effectively under British colonial rule, if not actually occupied by the British army.
The British colonial possessions discussed in the article are, indeed, tax havens and have been described as such by every writer on the topic from the flakiest up to the Economist Intelligence Unit http://store.eiu.com/description/M727des.asp. Red Tony's attempt to corral his colonies has been going on for a few years now. The OECD has gotten into the act with its Financial Action Task Force (http://www.oecd.org/fatf/) handling Money Laundering and the OECD, itself, http://www.oecd.org/daf/fa/harm_tax/harmtax.htm handling what it calls "Harmful Tax Practices". By the latter, it means evil countries that set their taxes too low. It does not mean the harm involved in tax collection itself. The Barbados meeting http://www.oecd.org/media/release/nw00-123a.htm was co-sponsored by the Commonwealth (formerly the British Commonwealth). They released a hopeful closing statement of agreement and cooperation but nothing is likely to come of it since the world's largest tax haven (the US) is never the subject of these talks. After watching these activities since shortly after the US government started to crack down on trusts back in 1962, I have learned to ignore what governments say and watch what they (and the market) actually do. More important than bank secrecy itself is the ability to easily create legal entities. One of the reason that the US is a popular tax haven (for non-US persons) is because it is so easy to create various business and personal entities here. The Net have only made things worse. With a dozen P2P payment intermediaries created in the last 18 months or so and hundreds of online securities brokerages, it's rough for the control forces. DCF ---- "May the Lord enlighten ... the Swiss banks -- that they might uphold justice and preserve the integrity of their own laws and the laws of confidentiality, trust and basic decency between the banks and their clients." Imelda Marcos' Prayer for the Swiss Banks - Manila - Sunday 25 February 1996.
participants (13)
-
David Honig -
Declan McCullagh -
Duncan Frissell -
Jim Burnes -
Jim Choate -
Jim Choate
-
John Young -
Ken Brown -
mean-green＠hushmail.com -
Phillip H. Zakas -
Ray Dillinger -
Steve Schear -
Tim May