Mixed Signals

Recycling as a concept is not a bad idea. It is in the execution where things go awry. A logical leap fallacy occurs when assuming that because the recycling of materials A-D makes sense it must mean also that the recycling of materials E-Z makes sense.

Generally speaking the recycling of metals and glass make economic sense because reuse involves less effort than production. Due to the chemical nature of plastics it is practically impossible to recycle them for their original application. And the whole notion of recycling paper to “save a tree” makes about as much sense as not eating tortillas in order to “save corn.” If paper weren’t being used, then tree farmers would not plant trees. Contrary to popular mythology paper does not come from old growth forests – it comes from tree farms. In fact an argument can be made that virgin paper is actually better for the environment than recycled paper. Trees remove carbon from the atmosphere. Recycling of paper just tosses that same carbon back and forth like pitcher to catcher; virgin paper use creates a steady withdrawal of carbon from the atmosphere.

How do we know when recycling is “good” vs just “feel good”? If money is offered or it’s something best not released into the environment are two key indicators. Sometimes those two things coincide as in the case of lead acid batteries. Recycling these batteries creates a “double-whammy” effect: you make money and protect the environment! Who could object to that? The EPA apparently. Read on.

Last year our company had to replace the lead-acid batteries in our corporate power back up system. We had to unload over a thousand pounds worth of them and I was not keen on just dumping them in the trash. Fortuitously enough I was able to locate a company not far from us in Watkinsville that would not only take them off our hands but also cut us a check for them. This provided an incentive for me to stockpile my own used lead-acid batteries at home. After about a year or so and a hundred pounds later I was ready to divest myself of these batteries. Unfortunately that local recycler was out of business. No problem I thought, there is a county recycling station not far on Highway 15. So I drove on over only to discover for some bizarre reason they are not open Tuesday or Thursday, and my luck being what it was, it was Thursday. Artificially constrained hours of operation accompanied by a gate for an open-air facility is truly puzzling. Are they afraid someone is going to steal the recyclables? Wouldn’t that be a good thing? Artificially constrained access encourages people to not even bother if they have to make a special trip vs simply taking care of it when most convenient.

However, it turns out the closure did not matter as they don’t accept lead-acid batteries. Ok, so does my curbside garbage service take them in their recycling? Nope. Ok, surely the county dump takes them! Everything ultimately ends up in the dump, right? It’s the trash bin of last resort. So I drove to the Oconee county dump only to be told, no, they can’t accept lead-acid batteries due to EPA restrictions. So, let me get this straight, the EPA, the organization charged with ensuring the environment is protected from harm has set up regulations that prohibit a DUMP from accepting a known environmentally harmful agent (lead) but then provides no alternative to the those trying to properly unburden themselves of this material? EPA “protection” creates a perverse incentive to improperly dispose of it in the general trash. The agent at the dump then suggested I try the local Autozone. Ultimately this is where I took them and they were all too happy to take them off my hands.

So in conclusion, a non-governmental entity, enticed by market forces, helped me do the right thing, whereas when I tried to do the right thing, government (local and federal) thwarted nearly every attempt to do so and actually incentivized me to do the wrong thing. The first rule of behavior modification is provide an easy, not obstructed, path toward the desired end.

April 26 / 2016

False Equality

This year the so-called “Equal Pay Day” was April 12th. It’s “celebration” is a weak attempt at capitalizing on the notoriety of the entirely valid “Tax Freedom Day” (i.e. the day after which a country’s citizens get to keep all their income if they were theoretically taxed at 100% until their tax burden was satisfied). In 1900 in the United States Tax Freedom Day was January 22. Today it is April 24. We have lost a lot of freedom in the interim. Many real injuries to women’s right have been reversed in that same interim; however pay inequality has always been a phantom menace. Equal Pay Day is but a disingenuous mischaracterization of a statistical truth as proof of willful malfeasance.

Yes, if you lump all female workers together and all male workers together the females earn about 79% of what the men earn. But through willful blindness of the trees (different jobs) in observation of only the forest (aggregate salaries) this statistic fails to make the case that it is employer discrimination that robs women of their rightful earnings. To highlight this failing consider another similar statistics. Comparing workers below age 45 against those over age 45 we find a similar gap. Those 45 and under earn about 80% of those 45 and over.  Clearly there must be a bias toward paying older works more. Or consider not pay but rather work place fatalities. On average, for every female workplace fatality there are twelve men who perish.  Again, clearly this must be a sign of a negligent disregard for the safety of men in the workplace relative to women. Oh, what’s that you say? There are obvious reasons why an older worker would earn, on average, more than a younger worker? There are obvious reasons why more men would die in the workplace than women? True (to both), yet somehow the “obvious” reasons that would also contribute to a difference in aggregate pay between men and women are dismissed out of hand whenever issues of gender pay disparity are discussed. Why is that?

If one were to look at wages at a hypothetical hospital where all the men were doctors and all the women were nurses would it not be surprising that the women made less than the men in aggregate? In reality, when numbers are adjusted for age and education, women (pre-child birth) earn just as much if not more than men in several fields. The shift occurs as couples start to have children and women take on the traditional role of staying at home and raising children.  This means they leave the workforce (reducing earnings based experience) or take on lower paying, more time-flexible positions.

Now the strident feminists among us might actually agree and say it is this cultural “patriarchy” that must be changed – by force. I’m not sure what they would have us do though – have the government decide which parent must raise the children in order to keep the distribution of male/female stay-at-homers equal across society? Even though feminists may privately admit that culture is the real reason for this wage “gap”, publicly they persist in casting employers as the scapegoat. This stance though demonstrates a profound lack of understanding of basic economics. Unsurprisingly, the type of person who will loudly clamor for more government intervention in the workplace to ensure “fair” pay for women will also decry the “greed” of the employer in paying them less. The irony of that position is that if the wage gap were employer driven, their supposed vice (greed) would quickly neutralize it. A properly “greedy” employer would seek out every women they can find in order to achieve a 20% discount on their payroll. In turn the unemployment rate for women would be 0%. But of course it is not. This lack of 0% female (or any supposedly discriminated group for that matter) unemployment should put to rest the notion that discrimination is the proximate cause for such pseudo-pay disparities.

Honey I Shrunk the Seat!

Senator Chuck Schumer (D-NY) recently introduced an amendment to an FAA reauthorization bill that would have required the FAA to set minimum values for how narrow and close commercial airline seats may be. Fortunately, this amendment was rejected last week.  While those of us who have flown in recent years (and experienced firsthand the “Honey I Shrunk the Airplane Seat” phenomena) can all certainly sympathize with the goals of such legislation, it would nevertheless be a gross violation of the rights of the airlines to dictate how they may or may not utilize equipment THAT THEY OWN. Of course there already exists an ever-expanding regulatory framework that strangles other businesses similarly. So how is this any different? It’s not. And that’s what is so scary – it was rejected not on principal but rather because it was visible. Visible government intrusions send the wrong vibe to a supposedly freedom loving populace. But invisible intrusions go on every day and are of course perfectly fine. If the death penalty were required to take place in public it would be ended immediately; but when done behind closed doors the public in general couldn’t care less.

Such reflexive urges to regulate by those “in charge” of our lives are a predictable outcome of their glaring ignorance of basic economics. It is the usual story: government engages in Practice A which stealthily causes Harm B and so our great benefactors must now step in to save us from the very harm they caused in the first place. For example, the federal government, through its puppet the Federal Reserve, is constantly inflating the US dollar. This steadily erodes the value of said dollar until after many years the drips of annual inflation have carved a canyon of lost value. There are two ways to respond to this declining value: raise prices, or, maintain prices while reducing quantity/quality. For example, boxes of cereal now contain 15% less than they did only a few years ago but are marketed at the same price point. It is a surreptitious form of inflation that consumers don’t immediately recognize but is just as injurious to their buying power as is rising prices.

Competition has become so fierce that a game of chicken has ensued where no one wants to be the first to raise nominal prices. This has occurred with airlines as well. Although ticket prices may have risen or fluctuated with fuel prices, such prices are, all things equal, less than they otherwise would have been had seat sizes not shrunk. Getting 10-15% more seats on a plane means lower average cost for each flyer. It is simply a natural response to the incentives created by government interference in the economy (Fed money printing). Eventually seat sizes will decline to a level where ridership will drop off. At that point the industry will know they can go no lower. But that is how the market works; the feedback of profit and loss tells businesses if they are doing good or doing poorly. Top down regulations subvert that process and prevent the voice of the consumer from being heard.

Actually, progressives like Schumer should appreciate the spectrum of market prices engendered by this seating freedom. It incentivizes those who value comfort over money to pay ever-increasing prices for the larger seats. These higher prices can be used to subsidize other ticket classes thereby expanding fare access through lower prices or halting the size decline. By allowing consumers to vote with their dollars the market delivers what consumers, in aggregate, are willing to accept. While any single consumer may disagree with where that point is, it should no more be the right of a minority of consumers to dictate to all what they should be able to buy any more than a minority of busybody senators should be able to dictate to a nation how they may live their lives.

Policy by Prediction

Science is supposed to be the domain of testable (and thus falsifiable) claims the evidence for which is a body of empirical studies that have stood the scrutiny of reproducibility. With the advent of computers that method of science seems to be growing increasingly passé. Why, we don’t need to bother actually doing the grunt work of experimentation, we can just sit back, press a button and let a computer model tell us the results. Of course the fault lies not in our machines but in ourselves (with apologies to the Bard). Computers are but tools that make some of that grunt work easier. But computer models are not so infallible that their output should solely be relied upon. They are imperfect not due to some failing of the technology but rather because they can only do what we tell them, and we humans are far from perfect or omniscient.

The flaw in computer models is two-fold: assumptions and unknowns. Assumptions are made about the contributions of certain factors and those assumptions are often wrong or even if close to being right can still introduces tremendous variability in outcomes from small differences in input. Unknown unknowns are an even greater contributor to the phenomenon known as “garbage in – garbage out” of modeling. We can’t account for the contribution of something we don’t even know exists.

Models are supposed to be part of an iterative process where you do the actual experiment, compare the results to your model’s output and then modify your model. To test the model you then change some of the variables and see how well it holds up in comparison to “real world” results. But, as soon as a new variable is introduced or a new unknown comes into play, then the model’s usefulness must be called into question.

Now by this point you might think I’m going to delve into an indictment of the climate models poor record of prediction but actually I’d actually like to talk about nuts. Or rather how we should all expect the price of nuts along with a host of other crops (pistachios, almonds, soybeans, tobacco, peanuts, cotton, lettuce, alfalfa, tomatoes, watermelon and bell peppers) to increase in price in the coming years due to the EPA banning a pesticide known as flubendiamide.  EPA determined that flubendiamide could break down in the environment and potentially cause harm to a few aquatic species. Ok, sounds like some dangerous stuff, fair enough. But, it turns out this alleged harm is not based on empirical studies but is rather based on computer models that attempt to predict toxicology – “predictive toxicology” they call it. BayerCropScience, the manufacturer of flubendiamide, went on record stating that such models “exaggerate environmental risk.”  Well imagine that, a computer model overstates the likelihood of a deleterious outcome in order to justify governmental intrusion into the market. Although science cannot be manipulated to service political interests, models surely can – click, click, here comes the desired result.

This ultimately is the true danger of such models. It is one thing if scientists want to put all their faith in such models, the worst that can happen is that eventually someone is made to look the fool when actual empirical studies prove them wrong. However it is far more dangerous if the cart is pushing the public policy horse by having bureaucrats and our supposed intellectual superiors run our lives and then justify their actions by pointing at selectively funded model-based “research” that can be tweaked to magically provide an outcome that conforms with the policy prescriptions desired. All that is needed to shut down debate is to claim “it’s science” and that it is “settled.”

Party Time

The American political party duopoly is a curious thing. Every other modern democratically run state has multiple political parties that freely compete for votes in order to establish their representative share of the people’s voice within the government. But that’s not the case in America; here we have two parties that share total control of the state apparatus on a semi-regular seesawing 8-year cycle. The curious thing is that no one questions why this would be? Is it that in other countries there are four, five, or six different more nuanced mixtures of political opinion but somehow when you cross the American border human minds undergo a transformation that imparts upon them the capacity to only hold allegiance to one of two political mindsets?

As you might have guessed there is no magic involved at all. Wherever you find constrained or limited options you will find government pulling the strings from behind black cloth. Political parties are not institutions established by the constitution. Indeed they are not necessary at all for our government to operate. Political parties are private institutions, businesses really, and are the product of the natural tendency of people with similar views to work together for common cause. That is all perfectly fine. The problem occurred over time. Whenever one party gained control, they would pass laws (erect barriers) making it that much harder for opposing parties to gain access to the ballot box. If your opponents can’t get their name on the ballot that tends to increase the likelihood you will remain in office.

Simultaneously they made the process of their campaigning that much easier by passing laws (providing assistance) that authorized the government to use public resources to assist with internal party business (i.e. nominating primaries) thereby supporting the illusion that party business is really state business. That is to say, these private businesses (Democrat Party™ and Republican Party™) have the cojones to get the public to pay for their private primary elections that ultimately are entirely pointless, as it is the party delegates that decide the nominee, not the voter. This process is merely an insidious trick to dupe the people into feeling as though they have a voice in the process so that they come to view the primary process as party of “democracy” when it is nothing more than a privately run, and publicly paid for, straw poll. This process has gone on so long that most people are unaware of the distinction and simply view the “primaries” as part of the normal political process of electing someone to office. They are not. They are private events held in public, paid for by that public, masquerading as democracy in action.

These political parties care not one wit about your vote or what you think. Because they are both private organizations they can ultimately pick whomever they want to be the nominee. They prefer to have the blessing of the voters upon their anointed candidate in order to give the people the illusion of choice. People are more easily controlled if they feel like they have some control of their life – if they feel like they have a choice, even the illusion of choice, they will accept a result even if they do not agree with it.

Duopoly control is further assured since most elections do not require the winner obtain a majority of the vote if by some miracle a third candidate appears on the ballot. This rules out runoff elections, which afford voters the ability to rank their choices. The deck is then further stacked against the third party candidate as people make a pragmatic rather than a principled choice to ensure the “most evil” candidate does not win

Political parties have co-opted the authority of government in order to ensure their continued stranglehold on power in this country. This is not democracy. This is not freedom. False choice is not real choice. We laugh at countries with only one name on the ballot and yet somehow only two names on the ballot seems perfectly reasonable. If you truly believe in democracy then you must demand the people be free to choose from all options. Every flavor of ballot access laws should be repealed, campaigning on the ballot (D or R next to the name) should be banned, all winners must have a majority decided through instant runoff style elections, and the Democrat and Republican parties should either have private nominating conventions or pay for their own public elections.

Muh’ Science!

Even among those that profess a belief in limited government there is an ready willingness to join hands with the big-government progressives on the subject of science funding. I mean, any fool can see we need government to fund science – no profit-oriented business would fund basic science research if the probability of a marketable product resulting were unknown. A recent article in Scientific American (Feb 2016, pg 11)  editorializes on this very viewpoint – that “without government resources, basic science will grind to a halt.” The irony within the article is that the author doesn’t realize the evidence he cites to advance his position in fact undermines, rather than bolsters, his argument. He claims private profit seeking businesses would never have an incentive to pursue such research… right after citing how such businesses used to do exactly that (AT&T Bell Labs and Xerox PARC). Gee, I wonder why they stopped? You don’t suppose it had anything to do with the ever expanding growth of government funding of basic science research? Indeed, why would any company make investments into basic science research if some other large entity (the government) is going to do it for them by publicly funding the research and freely publishing the results? The author then doubles down on the cognitive dissonance by calling those who believe that profit-driven companies will altruistically pay for basic science naïve. So people are naïve to believe that something that the author just cited as a past occurrence (privately backed basic science research) could occur in the future? Indeed, although it did snow last winter, now that it is summer I think it is naïve to believe it could ever snow again.

Truly there is no clearer case of the cart pushing the horse. The increase in public funding of basic science research was not a response to declining private funding; rather, it caused that very decline by providing an incentive for private industry to shift the risk burden onto the public.

If one is still unable to imagine a world without socialized science funding, then let’s examine history to see what the future might bring. Not only did we have the private labs of AT&T Bell Labs as well as Xerox PARC as free market models, we also had non-profit philanthropic foundations, such as the now over one-hundred year old Research Corporation for Science Advancement. Research Corporation, while philanthropic, follows a sound business model. They invest in basic scientific research at universities and when that research yields results that can be commercialized they package the technology and transfer the patents and use the profits to support future research grants.

Imagine that, a free market approach to funding basic science research that is both sustainable (success breeds more success) and does not require theft (taxation) in order to fund it. These are but a few examples of how the free market did, and can once again, provide support for basic science research and puts the lie to the assertion of the state-worshipers that such things are impossible without government support.

Land of the free?

Willful ignorance is the ability to be both cognizant of a fact while simultaneously ignoring it. This affords one the ability to derive some measure of comfort from pretending to live in a world where such a fact is not extant. For example, a child may know deep down there is no Santa Claus but derives more psychic comfort in pretending that there is. Any belief system that makes testable claims is susceptible to objective scrutiny and when that scrutiny undermines the belief, willful ignorance typically ensues in order to preserve the comfort of that belief. While the world has many religions, there is one belief system that transcends them all. Nearly every member of our species adheres to it (insofar as it seems to be woven into our DNA). It is known as tribalism or its more common variant, patriotism. This is the belief that ones own arbitrarily defined group is superior to all other arbitrarily defined groups. One can even stack their tribes and believe each is the best (best city, best county, best state, best country). Now while there may be no way to prove or disprove ones estimation of their group’s “greatness” sometimes the patriot will make a testable claim, such as, “America stands for freedom and independence” or “America is the freest country in the world.” The latter is easily disproven by reviewing any of the various indices of freedom (the US ranks very poorly at around 25th). But even if the US is not quite the freest it is still believed by the patriot that America is a “free” country; that we fought the Revolutionary War in order to gain our “freedom”. A close examination of the actual history shows that it was not a war of independence for the peoples of the United States but rather a war of independence for the governments of those states from Great Britain. The individual remained just as ruled after the war as before, all that changed was the accent of the ruler. But the myth persists, that America is all about freedom of the individual against tyrannical governments and that our military fights to preserve “our freedom”. This is where the willful ignorance comes in to play. Let us examine the evidence that puts the lie to that notion of “our freedom.”

Would a free country enact laws restricting the non-violent behavior of its citizens? Would a free country throw people in a cage because they exchanged an unapproved good or service for money? Would a free country throw people in a cage if the exchange were approved but the exchange did not conform to some third party’s idea of the proper conditions for the exchange? Would a free country throw people in a cage because they did not get permission from someone to work for themselves or others? To wit, a recent article in the Morgan County Citizen (3/3/16, pg. 1) or Lake Oconee News (3/10/16) concerning a lake homeowner who faces JAIL TIME for renting out her home for short-term vacations. The horror! Yes, certainly, let’s JAIL this MONSTER who clearly represents an imminent threat to public safety. The point is not “did she do it?” the point is “how can such a law even exist in a supposedly free country?” America the land of the free? North Korea would be proud.

Laws prohibiting or regulating human actions are in an absolute sense anathema to the supposed principles this country was founded on: freedom. If a transaction is voluntary and there is no fraud involved then it can’t be “wrong” in a civic sense. You might morally frown upon some activities but you have no more right to impose your morals on others than they have to impose theirs on you. If you wish to live exclusively among those sharing your exact moral code, then follow the Amish example and set up your own private communities. The public sphere does not become a private sphere just because you happen reside within it. Repeat after me: if violence (or the threat thereof) is the only way society can change the behavior of non-violent actors then there is something wrong with society.

March 15 / 2016

Trade Balance

Last week’s article touched on seen benefits and unseen harms wrought by political intervention into people’s lives. This week we pivot to a somewhat new corollary of that principle, that of imagined harm. This is harm that can’t exist but because of a fundamental ignorance one has an expectation that it will occur. Ignorance of economics leads to a broad range of bad predictions and decisions and even businessmen (e.g. Donald Trump, Warren Buffet, etc) are not immune to such ignorance. Despite Trump’s repeated protestations that “we” (America) are “losing” because of the presence of trade deficits with some countries (notably Mexico and China) there is simply no cause for concern. The current trade deficit between the US and Mexico is $58 billion. That means that Americans purchased $294 billion in goods from Mexico but Mexicans purchased “only” 236 billion in US goods.  In Trump’s mind (and many others) this constitutes a loss. Well if that is so I guess I had better stop buying my groceries from Publix – my family’s trade deficit with Publix is thousands of dollars every year! Yes, I would be much better off if I grew all my own food, than my trade deficit with Publix would be zero. Do you see how ridiculous this sounds now? So to solve a trade deficit Americans should pay even more for the goods they want? This is supposed to somehow compel the Mexican government to coerce its citizens into buying more US goods? How can any government make its people buy more from a particular country? Countries are not monolithic entities; they are composed of individuals.

Trade is not a zero sum game where one side “wins” and the other side “loses”. Both sides gain or profit from any trade in the sense that if either party did not value the thing they got more than the thing they gave up they would not have engaged in the trade. Trump and his ilk view trade like a game of Monopoly because they fall for the fallacy of anthropomorphizing countries into single actors and then distill all trade down to a single good: money. So in his mind the US gave Mexico $294 and Mexico gave the US $236 – as though they were just swapping currency and nothing else. Yes, that would be a loss, but that is not at all what is going on. It is an absurd distillation of the transactions of millions of individual actors into a meaningless aggregate. To get a clearer picture of what is going we need to disaggregate these numbers. Let’s imagine that Joseph buys $10 worth of goods from José. Joseph now has a $10 item and José has a $10 bill. Who lost here? No one. Trump would view this as a $10 trade deficit. But a deficit implies some sort of debt obligation, that something is owed, but nothing is owed, both sides swapped value for value. Now imagine that José buys $7 worth of goods from Joseph. Joseph now has $3 in goods and $7 cash, or $10 of value. José now has $3 in cash and $7 in goods, again, $10 in value.

Indeed all trade follows the rules of double entry accounting. Mexico’s cash account goes up while their goods account goes down: in balance. The US’s goods account goes up while their cash account goes down: in balance. Claiming a trade deficit exists is the equivalent of looking at only one side of a standard accounting balance sheet and claiming it is not balanced because one refuses to look at the other side of the sheet.

To the extent that jobs and industry are moving out of the US and that this harms in the short term those that lose their jobs perhaps it would be more appropriate to not lay blame at the feet of those business moving away but rather ask the origin of the incentives they are responding to (regulations, unionization, taxes anyone?)

Trading Places

A basic economic principle is the necessity of accounting for both the seen and the unseen (first elucidated by the great French economist Frédéric Bastiat). It provides a basis for understanding how politicians perennially cast themselves in the role of Santa Claus whilst picking our pockets. We are a willing audience to the magician who dazzles us with (for example) public works project (the seen benefit) while remaining unaware of the unseen harms unfolding (those things not done, created, or attempted due to diversion of resources into the political projects). The principal works for any intervention into people’s lives. For example, sanctions or trade embargos are often put in place in order to influence the actions of the leaders of another country. Although there is not a single historical precedent for this ever working, it remains the most popular passive-aggressive tool in the arsenal of the state. The language used to speak of such embargos employs the ruse of anthropomorphization (“America” cuts off trade to “Iran”) in order to hide the underlying reality that rather than the target country being harmed it is the individuals that constitute that country that are harmed. See, it’s not millions of people being made to suffer; it’s just a nebulous non-human “country”. Those who engage in these practices of course understand the reality of weighing human suffering and misery against the greater good of their desired ends. Indeed it was Madeline Albright’s admission that the deaths of approximately half a million Iraqi children during the 1990s sanctions against Iraq were “worth it” in order to achieve their goals (this remark was specifically cited by Osama Bin Laden as one of the many reasons behind the 9/11 attacks).

But that is just the seen harm. There is also an unseen harm levied against US citizens and businesses who are barred from trading with the country embargoed (for example, Iran). Iranians want to buy US made goods. US businesses want to sell those goods. We have a willing buyer and a willing seller being prevented from engaging in trade because of a belligerent busy-body-bully in the middle. Those lost sales for US businesses will not be made up somewhere else – they are simply gone. These missed opportunities lead to more unseen harms – lost jobs, or rather jobs that would have been created but never were.

To the extent US businesses have foreign competitors in countries lacking an embargo against Iran then it is our own government that is pushing sales into the arms of their competitors. Brilliant. Some might say that this loss in sales to US companies is “worth it”, that it is their patriotic duty to suffer through such lost sales in order to help our country battle the existential threat we face from a country… that has never threatened us nor attacked any other country in over two-hundred years. Well that is certainly easy to say when you’re not the one cruising past potential income you are barred from touching. Ask yourself, would you willingly skip annual bonuses if your government told you it would help influence Iran? Yeah, I didn’t think so. And apparently Boeing doesn’t think so either   – this politically well-connected company managed to get itself on a short list of companies exempt from the current trade embargo with Iran. How convenient. Apparently the expediency of pleasing big donors trumps the so-called “national interest” that applies to everyone else. Justice for all indeed.

Fighting against 1984

The State is getting nervous. Technology has a way of disrupting institutional power. The Guttenberg printing press liberated the flow of knowledge from the former stranglehold of the Church and its scribes. Today the digital realm of the Internet is effecting a similar change with self-publishing upon the old-world monopoly of the print-publishing house. Travel agents are virtually a thing of the past. Bitcoin is beginning to threaten the monopoly the banks and the government have over the flow of money. Encryption of our digital lives (personal electronic devices) is now threatening the power and relevance of the State. Encryption means we can manage our own security; we don’t need some nebulous State apparatus to keep us safe and secure. Nearly everything that is important to us (photos, messages, financials, medical info, etc.) is locked away securely in our digital treasure chest.

But the State will have none of that. They demand the key to that treasure chest. Both New York and California legislatures have introduced bills banning the sale of smartphones that do not offer some sort of encryption “back door”. How dare these companies make a product that is impervious to the prying eyes of the State! This is a direct threat to their unlimited power to intrude into our lives.

Not to be outdone, the Federal government is getting in on the back-door game. A federal judge recently ordered Apple to assist the FBI in unlocking the iPhone of one of the San Bernardino shooters. Apple is openly defying this order. The primary problem is that were Apple to comply with the order there is nothing to prevent the technique used from falling into the hands of truly “bad guys” who could then threaten the privacy and security of every iPhone user. It’s like the government asking scientists to build the atomic bomb “just this once, to stop the bad guys”. Once knowledge is out there it cannot be contained.

But even worse, the government’s use of an act from 1789 (the All Writ Act) to compel Apple to help them sets a dangerous precedent. It is not the case that Apple has in its possession information that it is being asked to hand over (which it has always done in the past when presented with a warrant). Instead Apple is being forced to help the FBI, drafted as it were, unlock this device. Insert picture of government agent holding loaded gun to Tim Cook’s head and saying “help us, please” and you’ll get the picture.

Yes, but you say the FBI is trying to stop future terror events, so anything to prevent a loss of life is worth it. Ok, well that cuts both ways. If Apple helps the FBI on what grounds could it refuse to help the government of China, Russia or perhaps even a threatening mob boss? After all, they know that since Apple helped the FBI then it is indeed possible to unlock these things. Is the standard of behavior to be: Apple helps any “legitimate” state actor, except when they are bad, because of course everyone knows who the goods guys and bad guys are.

To be clear, this is not Apple’s property. They are a third party being asked to do the government’s bidding. If they complied it would set the awful precedent that the companies we do business with can be secretly dragooned into the employ of the State in order to spy on and monitor us without our knowledge. Don’t think that can happen? Well, the government already has a terrible track record of abusing its surveillance power. It took Edward Snowden blowing the whistle to show us how the NSA was spying on everyone in contravention of the Patriot Act. In fact Samsung just recently warned its customers that its voice recognition could be used by third party vendors to listen to conversations so they advised caution about what you say in front of it. Now imagine Samsung receives a request from the FBI to “help” them monitor everyone so they can ensure “our safety”. Nah… I’m sure that would never happen. Thank you Apple for fighting for us. Your actions today may well ensure that our future “won’t be like 1984.”

February 23 / 2016
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