[youtube:http://www.youtube.com/watch?v=LJReAunlOw0 285 234]
big brother
This story just hit the Drudge Report’s front page. Declan McCullagh at CNET writes today about the latest revision of S.773, a bill that would give the president “emergency control” of the internet in case of a “cybersecurity emergency.” Wayne Crews, CEI Vice President for Policy, released a statement on the naming of the cybersecurity chief and wrote an article on this back in May. See an excerpt below:
Policy makers should avoid collectivizing and centralizing risk management, especially in frontier industries like information technology. Yes, we need government-backed “police forces” to protect private networks and infrastructure, but we also need the “barbed wire” and “door locks” which private companies continuously compete with each other to improve. When government overrules market competition for information/electronic security, it creates barriers to innovative private security solutions. We become less secure, not more.
Some reports indicate that the administration and Congress are seeking government authority over private networks-like power grids and computer networks-in the event of breaches. The very term “cyber” at once means everything and therefore nothing: American telecommunications, the power grid; virtually anything networked to some other computer is fair game to a new czar. The dominant tenor of the cybersecurity debate today is toward greater federal control over private infrastructure.
Washington has a proper role. It entails protecting government’s own networks and setting internal security standards, not regulating private networks. It involves arresting computer criminals and avoiding creating threats to data security in the form of data retention mandates, national ID schemes, proposals to re-regulate encryption, and czars that set terms for all they survey.
Security is an industry, and industries-and abstract concepts like “technology”-do not need czars in Washington. Innovation in information security and privacy protection do not flow from D.C. Rather, a government tech czar would likely grow in “stature” as a target for lobbyists. A federal technology chief could all too easily become an agent for establishing government authority over frontier technologies.
Both suppliers and customers increasingly demand better security from all firms. Improving private incentives for information sharing is at least as important as greater government coordination to ensure security and critical infrastructure protection. That job will entail liberalizing critical infrastructure assets-like telecommunications and electricity networks-and relaxing antitrust constraints so firms can enhance reliability through the kind of “partial mergers” that are anathema to today’s antitrust enforcers.
Private cybersecurity initiatives will gradually move us toward thriving liability and insurance markets for cutting-edge sectors. Heavy-handed cyber-czar gestures and legislation cannot address the lack of authentication and inability to exclude bad actors that is at the root of today’s cybersecurity problems.
Like everything else in the market, security technologies-from biometric identifiers to firewalls to encrypted databases-and cybersecurity services-from consulting to liability insurance to network monitoring-benefit from competition. Corporate information and security officers deal with cybersecurity concerns every day. It’s not clear what government could really fix-but it could break a lot.
See the statement release here.
Your host Richard Morrison brings you Episode 51 of the LibertyWeek podcast, along with special guest co-host Jeremy Lott and Fellow in Regulatory Studies Ryan Young. We start with Judge Sotomayor in the Senate hot seat, a privacy threat from “smart” passports and why Rep. Dan Lipinski has decided your suitcase is too big. The discussion continues with Rep. John Murtha’s expanding corruption scandal, beer news from the Beaver State and the arrival of Wal-Mart in India. We wrap up with this week’s dose of brothel-themed Olympic News.
There are more developments on the charity front-not exactly related to the budget issue I posted on previously–but interesting nonetheless. Apparently, the National Committee for Responsive Philanthropy (do not miss this link!)-NCRP, wants to work with legislators to push this agenda. At first glance, its goals laid out here seem harmless enough:
It attempts to answer the questions: What differentiates an exemplary foundation from the rest of its peers? What can foundations do to improve its relevance to nonprofits, the economically and socially underserved Americans and society as a whole?
Of course, all things are not always what they seem. Here is a critique of the report in by Heather Higgins of Philanthropy Roundtable:
The full text of the report came out March 3, but NCRP has been circulating a 15-page summary that already makes clear that this paper is not only replete with flawed logic, poor economic understanding and selective data, but is most disingenuously an Orwellian world of deliberate redefinition, where benign and admirable words are used but have meanings very different from common understanding.
Why? Because this report is a tool to a larger end. The document says it’s to be used to “criticize those who do not measure up.” Moreover, “Policymakers may find the criteria valuable when considering regulations or legislation … and the media will find the resource helpful for reporting.”
Back up a minute. NCRP has been around for 30 years. Its Web site homepage features “Happy Birthday, Saul Alinsky,” for the radical-left union and community organizer. Though self-styled as an independent “watchdog” of foundations, the reality is that NCRP doesn’t care about charity broadly–indeed it’s quite contemptuous of large swaths of it. It only cares about encouraging ever-greater flows of funds to the groups it deems worthy and truly serving of the public good, chief among which would be “social justice” activists like ACORN, an NCRP member.
In another article by an affiliate group critical of the report:
However, despite its name, The Alliance for Charitable Reform believes these benchmarks have nothing to do with measuring effectiveness. In fact, the natural consequence of these benchmarks will be to reduce the scope and diversity of the foundation sector to one that serves a more narrow set of highly politicized interests…
…”On average, foundation assets have dropped 20-40% and The New York Times reports an unusual number of charities filing for bankruptcy. It is incomprehensible that the NCRP is proposing criteria that could further ravage the charitable sector,”…
Again, I leave with more questions: Is there an effort out there to ‘de-fund’ or seriously reduce the funding of certain private non-profit charities, and ensure only select ones remain well-funded? If so, why? I have no idea, it may be just a misunderstanding of intentions, but it sure seems fishy.
The prevention of regulation and the Rule of Law pounding its mighty fist within a medium or sector of business is generally something that is lauded around these parts. On occasion, though, an industry will find that it is possibly pushing the envelope ever so much over the line and chooses to act on its own behalf. This self-supervision, for the most part, tends to deter government involvement and the creation of legal regulation, which can in many cases be far more costly than self-imposed rules.
In December of 2007 the FTC notified the online advertising industry that Behavioral Targeting-style advertising was pushing the boundaries of privacy. Their letter–entitled “Behavioral Advertising: Moving the Discussion Forward to Possible Self-Regulatory Principles”–should have made it abundantly clear that this was a warning shot and the hammer was about to drop. The industry, quick to respond, and taking congressional action very seriously, announced yesterday (some thirteen months later) that they would seek self-regulation.
The announcement of the proposal to self-regulate came from a partnership between four advertising industry trade associations, including, American Association of Advertising Agencies (AAAA), the Association of National Advertisers (ANA), the Direct Marketing Association (DMA), and the Interactive Advertising Bureau (IAB). They plan to work with the Council of Better Business Bureaus to develop their guidelines.
Behavioral advertising is not a new idea. Advertisers have been seeking better ways to target market specific consumers since the first caveman opened a tool shop. There is nothing wrong with this. If I make widgets for men that work in coal mines in West Virginia, I’m going to set up billboards for my product outside the tunnel to the mine. This is just good business sense. But the modern computer age’s concern with targeted marketing is that it has become extremely personal, so personal that some are concerned with the privacy factor and how much personal data they may be giving up as they surf the web.
While surfing your favorite website, the site will send your browser (Firefox, Internet Explorer, Chrome, etc.) what is referred to as a “cookie”. It is essentially a small text file, quite harmless in nature, and is generally used to track things like web site shopping cart contents or personal settings on that website. It can, however, be used by advertisers enlisted on that site to determine what types of things you are interested in so that targeted marketing of ads can be implemented.
In these cases a cookie is sent to your machine from an advertiser on the site. This creates a sort of road map for the advertiser of what you like based on the content of the website you were viewing. Then upon viewing a different website, the advertiser can take the information it recorded about you from the cookie, and display adverts based on things you previously viewed that the advertiser assumes you would want to see. What results is a totally personalized advertisement experience for you while you surf the web.
So where’s the rub? While the identity of a user cannot be revealed by a cookie, a user that has registered with a website can be linked to a cookie. What results is a privacy dilemma because instead of an anonymous individuals surfing habits being recorded, very specific information about who this person is could then be revealed. Additionally, the advertiser could also then tie a specific person to what they are looking at online.
“When you start to get into the details, it’s scarier than you might suspect,” Marc Rotenberg, executive director of the Electronic Privacy Information Center, a privacy rights group told The New York Times’ Louise Story. “We’re recording preferences, hopes, worries and fears.”
Most Internet companies would provide the rebuttal that a user’s account information was seen as just an ID number. But the concern is that an ID number is attached to an account, an account contains the user’s personal info, and at some point the data could be accessed. The privacy concern may be far fetched, or it could be completely legitimate. It would all come down to the ethicality of the company.
So why the sudden movement toward action by the advertising trade associations after 13 months of ignoring the issue? Because PEOTUS Obama is days away from becoming POTUS. And rumors are that lobbyist fear behavioral targeted marketing will be the main privacy issue examined by Congress this year.
“There are no immune companies or business models from Capitol Hill or state regulation,” said Mike Zaneis, VP-public policy at the IAB.
Obviously the move is to get out in front of the issue. A self-regulating industry could deter Congress from considering legislation to legally enforce guidelines. But a self-regulated industry is also watch dogged by its own people. Only time will tell if they have the will power and character to maintain that approach, but it is certainly hoped for as less government legislation is the favorable outcome.
Apple's 1984 "Big Brother" ad
An article over at Ad Age brings up an angle on the whole auto industry bailout probably not considered much before. The fact that a yet-to-be-appointed “car czar” will have control over a multibillion dollar advertising budget for the big three. Under the guise of “oversight,” this would effectively “Create World’s Most Powerful Marketing Exec[utive].”
The draft rescue plan for Detroit sent to the White House by Congress yesterday calls for the appointment of a “car czar” who will oversee the Big Three automakers’ expenses over $25 million — which, by extension, would include media buys. Based on Advertising Age’s estimates of spending by General Motors Corp., Chrysler and Ford Motor Co., that would give the as-yet-unnamed car czar control over some $7.3 billion in marketing spending in the U.S. alone.
The most disturbing thoughts about this (particularly to those concerned with liberty) are provoked here:
The car czar would wield a budget more than double those of AT&T, Verizon, Unilever and Johnson & Johnson, which round out the nation’s top five marketing spenders, and give the car czar more clout with media and agencies than such famed names in marketing as Walmart Chief Marketing Officer Stephen Quinn and Anheuser-Busch VP-Marketing Dave Peacock.
…If the bailout goes through, agencies that work for the Big Three will essentially be toiling on a government account, with all the associated red tape and strictures that involves.
So there you have it. We should all be concerned about this for many reasons. As mentioned, the large ad budget that comes with a czar-controlled U.S. auto industry will allow a government bureaucrat to wield unbalanced and unchecked influence over not only who gets ad contracts, but what media outlets get ad money. The czar can simply refuse to give business to an advertising agency who works for a foreign competitor of the big three (or a “non-compliant” corporation), or refuse to pay money to show ads on outlets that they deem “unfriendly” to the administration or its mission. This will be an unequivocal disaster. We have already seen the lengths to which administrations (and pre-administrations) have gone to influence and/or silence media they do not like. What kind of power plays do you think are possible when the administration’s appointee controls a major source of media outlets’ ad revenue? Whatever it ends up being, it won’t be pretty.
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