Keith Alexander, the former director of the National Security Administration, is filing for tech security patents related to his work running the NSA. He’s hawking a hacker/intrusion-detection service to banks and big corporations for a reported fee of one million dollars a month. Is it ethical for an NSA chief to pursue patents on technologies directly related to their work running the agency? He is believed to be the first former NSA director do so. Will the Justice Department investigate? Don’t hold your breath.
To do their jobs properly, journalists and lawyers sometimes need to be able to keep information private from the government. And because what journalists and lawyers do is so integral to safeguarding democracy and basic rights, the United States has traditionally recognized their need for privileged communications. But the virtually inescapable government surveillance exposed by NSA whistleblower Edward Snowden has impaired if not eliminated the ability of news-gatherers and attorneys to communicate confidentially with their sources and their clients, according to a new report by two rights advocacy groups. The report by Human Rights Watch and the American Civil Liberties Union is based on an exhaustive new survey of journalists and lawyers working in the areas of national security and intelligence. Both groups of professionals describe a substantial erosion in their ability to do their constitutionally-protected jobs. Not even the strongest versions of NSA reform being considered in Congress come anywhere close to addressing the chilling effects on basic freedoms that the new survey describes. “If the US fails to address these concerns promptly and effectively,” report author G. Alex Sinha writes, “it could do serious, long-term damage to the fabric of democracy in the country.”
As more and more American companies have used international mergers to move their profits out of U.S. tax jurisdiction, the Wall Street firms that encourage and facilitate the deals have raked in close to a billion dollars in fees. The top 10 firms to work on the so-called “inversion” deals have brought in $819.8 million from the deals in just the past three years, according to a New York Times analysis.
The top of the list of corporate offshoring advisers is full of familiar names. Goldman Sachs leads the way with an estimated $203 million in fees, followed by JP Morgan ($185 million), Morgan Stanley ($98 million), and Citigroup ($72 milion). Those figures represent just the past three years of deals and are based on both public disclosures and analyst estimates of the fees paid in various corporate deals.
The deals in question — called “inversions” because they involve an American company buying a foreign-held firm based in a low-tax country and then flipping the merged company’s address to the tax haven nation without necessarily relocating in any practical sense — have boomed in the years since the recession. But the Times figures only date to 2011, so fees paid to the banks on dozens of inversions in prior years aren’t counted.
The deals are great for banks, and the corporate tax savings from them make Wall Street’s cut of the deal look tiny. But they have come under increasing fire in the past month as the White House has called for “a new sense of economic patriotism” from the country’s business elites and billionaire investor Mark Cuban has promised to sell off his holdings of any company that ditches America in order to shrink its tax bill. A bill to close the loophole that makes inversions legal has been introduced by the House by Rep. Sander Levin (D-MI), and the Joint Committee on Taxation thinks the bill would save taxpayers almost $20 billion over the next decade.
Inversions are just one facet of the many-splendored jewel that is international corporate tax evasion. The eccentricities of the tax code and the international race to the bottom among tax haven countries like Ireland, Luxembourg, Switzerland, and various islands in the Caribbean mean that companies have a variety of options for legally reducing their U.S. tax bill while maintaining their day-to-day operations in America. Apple, Google, Microsoft, Caterpillar, and many other business giants use elaborate licensing deals and shell company subsidiaries to shift profits off their American books.
There is no doubt the integrity of our communications and the privacy of our online activities have been the biggest casualty of the NSA’s unfettered surveillance of our digital lives. But the ongoing revelations of government eavesdropping has had a profound impact on the economy, the security of the internet and the credibility of the U.S. government’s leadership when it comes to online governance. These are among the many serious costs and consequences the NSA and those who sanctioned its activities—including the White House, the Justice Department and lawmakers like Sen. Dianne Feinstein—apparently have not considered, or acknowledged, according to a report by the New America Foundation’s Open Technology Institute. “Too often, we have discussed the National Security Agency’s surveillance programs through the distorting lens of a simplistic ‘security versus privacy’ narrative,” said Danielle Kehl, policy analyst at the Open Technology Institute and primary author of the report. “But if you look closer, the more accurate story is that in the name of security, we’re trading away not only privacy, but also the U.S. tech economy, internet openness, America’s foreign policy interests and cybersecurity.” Over the last year, documents leaked by NSA whistleblower Edward Snowden, have disclosed numerous NSA spy operations that have gone beyond what many considered acceptable surveillance activity. These included infecting the computers of network administrators working for a Belgian telecom in order to undermine the company’s routers and siphon mobile traffic; working with companies to install backdoors in their products or network infrastructure or to devise ways to undermine encryption; intercepting products that U.S. companies send to customers overseas to install spy equipment in them before they reach customers. The Foundation’s report, released today, outlines some of the collateral damage of NSA surveillance in several areas, including: Economic losses to US businesses due to lost sales and declining customer trust.
The deterioration of internet security as a result of the NSA stockpiling zero-day vulnerabilities, undermining encryption and installing backdoors in software and hardware products.
Undermining the government’s credibility and leadership on “internet freedom” and governance issues such as censorship.
The National Security Agency last year significantly expanded its cooperative relationship with the Saudi Ministry of Interior, one of the world’s most repressive and abusive government agencies. An April 2013 top secret memo provided by NSA whistleblower Edward Snowden details the agency’s plans “to provide direct analytic and technical support” to the Saudis on “internal security” matters. The Saudi Ministry of Interior—referred to in the document as MOI— has been condemned for years as one of the most brutal human rights violators in the world. In 2013, the U.S. State Department reported that “Ministry of Interior officials sometimes subjected prisoners and detainees to torture and other physical abuse,” specifically mentioning a 2011 episode in which MOI agents allegedly “poured an antiseptic cleaning liquid down [the] throat” of one human rights activist. The report also notes the MOI’s use of invasive surveillance targeted at political and religious dissidents. But as the State Department publicly catalogued those very abuses, the NSA worked to provide increased surveillance assistance to the ministry that perpetrated them. The move is part of the Obama Administration’s increasingly close ties with the Saudi regime; beyond the new cooperation with the MOI, the memo describes “a period of rejuvenation” for the NSA’s relationship with the Saudi Ministry of Defense.
When I broke into my neighbor’s home earlier this week, I didn’t use any cat burglar skills. I don’t know how to pick locks. I’m not even sure how to use a crowbar. It turns out all anyone needs to invade a friend’s apartment is an off switch for their conscience and an iPhone. This was done politely: I even warned him the day before. My neighbor lives on the second floor of a Brooklyn walk-up, so when I came to his front door he tossed me a pair of keys rather than walk down the stairs to let me in. I opened the door, climbed the stairs, and handed his keys back to him. We chatted about our weekends. I drank a glass of water. Then I let him know that I would be back soon to gain unauthorized access to his home. Less than an hour later, I owned a key to his front door. What I didn’t tell my neighbor was that I spent about 30 seconds in the stairwell scanning his keys with software that would let me reproduce them with no specialized skills whatsoever. The iPhone app I used wasn’t intended for anything so nefarious: KeyMe was designed to let anyone photograph their keys and upload them to the company’s servers. From there, they can be 3-D printed and mail-ordered in a variety of novelty shapes, from a bottle opener to Kanye West’s head. Or they can be cut from blanks at one of KeyMe’s five kiosks in the New York City area.