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The State Threat to Computer Privacy

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The Clinton administration is proceeding apace with a plan to force each of us to give the government a spare key to our houses and offices. Well, that’s not literally what they want. They want a spare key to our filing cabinets.

That may be cryptic, but in time the reader will see the aptness of it all.

The government is afraid that you and I may be discussing illegal activities when we communicate with each other. Some of that communication is filed away. So the government wants to be able to get into those files without our knowledge or permission. It could get a warrant, enter our homes and offices, and search the files. But what if we use filing cabinets with such good locks that the government can’t get into them? That’s why Clinton and his gang want the spare keys. It would be made illegal to use a lock for which the government does not have a key.

Sounds scary, doesn’t it? But the scenario is not quite accurate. To make it so, just put the word “electronic” in front of the references to files and filing cabinets. What the government wants access to is our computers, our e-mail, and all our electronic “papers.”

Right now, it is easy to lock the government out. There are powerful, easy-to-use programs that give the common computer user access to military-grade cryptographic software that encodes files so that only intended recipients can decipher them. Most often used worldwide is Pretty Good Privacy (PGP), the brainchild of Philip Zimmermann, who, for his heroic efforts, was hounded by the government for over two years until it finally dropped the case several months ago. (PGP is available from MIT’s site on the World Wide Web.) But although Zimmermann seems to be off the legal hook, the Clinton administration has not given up hope of collecting all those spare keys.

It tries to reassure the suspicious among us by stating that law enforcement would need a court order to get any particular key. That is reassuring. The police never enter homes without a warrant. They never wiretap telephones without authorization of the independent judiciary. Shame on us for being suspicious of the FBI, the ATF, the DEA, the IRS, and the rest of the alphabet gang that shoots too straight for comfort.

It says much that the government is so desperate to get control of encryption. Like an overbearing parent, governments do not like when their citizens are able to do too much out of sight and earshot. It’s not just that we might be having too much fun, though that’s part of it. It’s that we all might get too large a taste for freedom and conduct unregulated by the government. We might even oh, horror! engage in financial transactions the state knows nothing about. We might talk about taboo subjects. We might . . . who knows what free people might do?

It has not gone unnoticed by legal scholars that something fascinating is happening on the Internet that vast network of computer networks. Law and etiquette (“netiquette”) are spontaneously emerging to govern people’s conduct. It’s still a bit rough-and-tumble. But it is not chaos. Nor should that surprise us. People are thinking, conscious beings. We have goals. That’s why we act. We certainly do not let chaos persist in thwarting our plans. We mutually adjust our conduct in order to maximize our chance of success. We generate customs and institutions, which are islands of relative certainty in a sea of uncertainty. Those islands help to create the order we need to achieve our ends. To deny that people create such order is to deny that people are purposeful. But to deny that people are purposeful is to contradict one’s self. A denial is a purposeful act.

Those customs and institutions are not planned, in the sense that someone sits down and draws them up in detail. They are, as the Scottish Enlightenment scholar Adam Ferguson wrote, the product of human action but not human design. The Austrian economists use a helpful example. Imagine an uncharted woods that someone needs to traverse. With difficulty he navigates through the woods, flattening undergrowth, pushing branches out of the way, and so on. When someone else comes along who needs to get through, his easiest route will be the one blazed by the first person. It will be even more so for the next person, etc. Before you know it, there’s a clear path. But no one set out to make a path, only to get through the woods.

That’s a highly simplified example. After all, a path is a simple thing to plan consciously. But institutions of great complexity, too complex to be intelligently planned, are generated similarly. That’s the marvel of the social process. Law, language, and markets are the best examples. How many people speak Esperanto? (Esperanto is a consciously formulated “optimal” language that, despite all the forethought, lacks the practical features natural, undesigned languages have.)

I presume there are two kinds of political leaders. The first and more common kind has never grasped the phenomenon of spontaneous order. He thinks all order is designed and imposed. He believes his guiding hand is vital to keeping the social process going.

The other kind of leader knows that social processes are self-sustaining but wants power for personal reasons. He plays on people’s ignorance of unplanned order to justify his power in terms of preventing chaos.

The attempt to control cyberspace has many precedents. Wherever markets emerged, someone tried to “rationalize” them. It’s not just true of markets. When the broadcast spectrum was first being exploited, Commerce Secretary Herbert Hoover and members of Congress hastened to write the Radio Act before order emerged out of the initial disorder. Judges had already begun to apply common-law ideas about property to the airwaves. Someone in Congress actually commented that if the government didn’t act quickly, things would get settled on their own. The result was nationalization under the thumb of Hoover, the reputed lion of laissez-faire.

No surprise, then, that a grab is being made for the Internet. The government says it needs to control encryption because criminals and threats to national security will seek refuge in it. That’s like saying we should be forced to use postcards for all our mail because criminals will seek refuge in envelopes. Phil Zimmermann points out that the government can’t read everyone’s physical mail; the task would be too labor-intensive. Half the population would have to be hired to read the other half’s mail.

But e-mail does not present that problem. The government’s supercomputers could go trolling through the entire volume of e-mail searching for key words and names. The price of eavesdropping has fallen, putting us all at risk of intrusion.

Advocates of computer privacy point out that the people’s security would be better protected by freedom of encryption. The National Research Council, which opposes the Clinton plan, says that independent encryption would thwart economic espionage and make the banking industry less vulnerable to disruption and theft. On the other hand, a central repository for all the spare keys would be a juicy target for hackers and more serious malefactors.

Others point out that encryption software conforming to the Clinton standard would find a scant export market, if any at all. Will businessmen in other countries really want to encode their e-mail with software to which the U.S. government holds the key? Today, the government forbids the export of powerful cryptography (which is classified as munitions) without a license. That prohibition would continue under the Clinton plan. Only the approved encryption scheme could be exported.

Encryption may seem an esoteric matter. Many people may not care to encode their casual e-mail. But this is a big issue that has many implications. The emerging cybersociety and cybermarket have the potential to enrich our lives in marvelous ways. A vast amount of information, products, and services could be at our fingertips literally. Here’s one small example: many people know the joy of a hobby, such as stamp collecting, chess, or opera. The joy can be multiplied many times through contact with like-minded people all over the world. E-mail among such people may not seem an obvious candidate for encryption. But the use of credit cards to buy books and supplies to further the satisfaction of a hobby is. We’d all feel more secure passing credit-card information through the Internet if we could encrypt, knowing the spare key isn’t hanging in some government office.

This post was written by:

Sheldon Richman is vice president of The Future of Freedom Foundation and editor of FFF's monthly journal, Future of Freedom. For 15 years he was editor of The Freeman, published by the Foundation for Economic Education in Irvington, New York. He is the author of FFF's award-winning book Separating School & State: How to Liberate America's Families; Your Money or Your Life: Why We Must Abolish the Income Tax; and Tethered Citizens: Time to Repeal the Welfare State. Calling for the abolition, not the reform, of public schooling. Separating School & State has become a landmark book in both libertarian and educational circles. In his column in the Financial Times, Michael Prowse wrote: "I recommend a subversive tract, Separating School & State by Sheldon Richman of the Cato Institute, a Washington think tank... . I also think that Mr. Richman is right to fear that state education undermines personal responsibility..." Sheldon's articles on economic policy, education, civil liberties, American history, foreign policy, and the Middle East have appeared in the Washington Post, Wall Street Journal, American Scholar, Chicago Tribune, USA Today, Washington Times, The American Conservative, Insight, Cato Policy Report, Journal of Economic Development, The Freeman, The World & I, Reason, Washington Report on Middle East Affairs, Middle East Policy, Liberty magazine, and other publications. He is a contributor to the The Concise Encyclopedia of Economics. A former newspaper reporter and senior editor at the Cato Institute and the Institute for Humane Studies, Sheldon is a graduate of Temple University in Philadelphia. He blogs at Free Association. Send him e-mail.