From: Black Unicorn <unicorn@access.digex.net>
Date: Thu, 7 Apr 94 14:55:59 PDT
To: tmp@netcom.com
Subject: Re: nsa digital cash?
In-Reply-To: <199404071634.JAA05501@netcom9.netcom.com>
Message-ID: <199404072155.AA10615@access1.digex.net>
MIME-Version: 1.0
Content-Type: text/plain


> 
> 
> tmp:
> > so? what's your point? my point was that the nsa was a prime candidate
> > agency for trying to *expand* the current federal role in the cash
> > system. are you saying the federal government already has a `digital
> > cash system'? well, yes, i guess in some sense.
> 
> unicorn:
> 
> >Why do you think BCCI was so popular with intelligence agencies?  The KEY 
> >effort in any agency is money laundering.  This is by definition the 
> >primary function of intelligence agencies, to bring funds to bear 
> >properly and quietly on projects and goals that don't sit well in 
> >public. 
> 
> yikes, hold on a sec. i was talking about the nsa. if you are for a minute
> suggesting the nsa is involved in money laundering i think you are *utterly*
> mistaken.

Then we have a difference of opinion.

I'm not going to try and convince a subborn fanatic, nor educate one on 
the operation and methods of intelligence agencies.  If you are not 
convinced that intelligence agencies create and use front companies, 
agents of influence in financial institutions, bribery, blind political 
support funds and transactions in general, you are not worth discussing 
the topic with until you read or do some intelligence work.

> also, i very sincerely doubt that money laundering is a major,
> minor, or even existing part of any u.s. intelligence services

I repeat the above.  Money laundering is essential to any intelligence 
operation, foreign based or U.S. based.  This is important not only to 
hide activities from the scrutiny of the public and hostile intelligence, 
but also to hide the source from the recipient.  Many political movements 
the U.S. would support, wouldn't be interested in the support if they 
knew it came from the U.S., or worse, U.S. intelligence.

> there is
> a gray area where sometimes an agency is associated with money launderers,
> because they may be informants or whatever, but try to point to any 
> u.s. intelligence operation that involved money laundering? and just
> try to pretend that the nsa was involved--

Radio free America.
Radio free Europe (Set up by a "Private" company)
Radio Liberty.
U.S. Listening posts in Great Britain.
Cuban resistance movements.
The Schoenfeld tunnel.
Support for the American Federation of Labor
Support for anti-Communist American Students abroad in the 50's-60's.
Civil Air Transport (takeover)
Air America and the partner Southern Air Transport.
Airdale (the holding corp for the above)

How many do you want?

Asserting that U.S. intelligence does not and has no need of money 
laundering is silly.  Asserting that the NSA is never involved is also 
silly.  Regardless, your assertion that the NSA will become involved in 
the control of Federal Transactions because it will give government 
more control is flawed even by your own accepted factors.

> i reiterate my point: designing a secure digital cash system would be
> a key area that the nsa would be interested in.

This was not your point, your point was that the NSA would control such a 
system.  This point is also flawed.  The NSA may create the technical 
means, but logistics are not in the cards.

 in fact, i think it is
> highly likely that they have already designed significant parts of the
> existing u.s. transaction infrastructure at certain levels. (they
> vetted DES, right?!)

This is a point entirely separate from the above.
This is what the NSA does, it does not create institutions for public use.

> (references? would be appreciated) that is essentially what clipper
> is intended to do.

Wrong.
Clipper is intended to maintain the COMINT/SIGINT ability domestically.  
This has nothing to do with finances and digital cash except in so far as 
the same hardware might be use to implement same BY PRIVATE ENTITIES.
This is of course assuming the private development of these systems is 
not sufficient, a premise which grows weaker by the day.

Intelligence would never risk overt control of domestic financial 
institutions that were not dedicated for use.  A silent involvement with 
a foreign bank through a front is much more efficient.

> >> are you saying you don't expect the federal government to expand their
> >> role in cash systems? or that it is already as large as it can get?
> >
> >Lumping the Federal system in with intelligence agencies in this 
> >context betrays significant ignorance in the structure of modern government.
> 
> the point of the nsa is that there is `no structure' to a government
> bureaucracy that senses its own impending extinction.

Where do you get this from?  The NSA is perhaps the most structured 
intelligence agency in the United States.  They certainly know their bounds 
better than the other collection arms, and I won't even mention the HUMINT
people.

> clipper is a grasp
> at an area that virtually all analysts agree is not a historical precedent
> for them,

It's easy to spout "virtually all analysts."  Want to tell us who and when?
As for historical precedent, when has the NSA come out public supporting 
a POLICY decision and not a technological development?  Clipper is not a 
grasp by intelligence, it is a utilization by executive authority of 
intelligence to support a centralist program.  If you cannot understand 
the distinction, you need to stay out of politics, and political analysis.

> and that dangerously impedes on *domestic* and *commercial* affairs,
> something they have never been authorized to do. (cpsr foia requests
> posted to various newsgroups are strong on this point)

Which CPSR requests?  How is this an intelligence operation that impedes 
on domestic affairs?  I repeat the above, this is program from the 
EXECUTIVE branch.

> >Between this and your misconception of the Federal financial structure 
> >that Eric was so quick to point out, I think you should keep your day job 
> >Det, or is this it?
> 
> sigh. fine. smear me with some more `det' insults. what was my misconception?
> neither you or erik have yet to specify what it is exactly.  i admit that
> i don't have a close grasp on e.g. the check clearing system and what 
> elements are in federal hands. but instead of yelling at and insulting me, 
> maybe erik could explain exactly how this system works. i doubt i am 
> the only one who is not aware of the precise structure. anyway, my basic
> point has nothing to do with the existing infrastructure.

Asserting that the FED had as much influence on retail financial 
transactions as you would have was your mistake.  Again, you make bald 
assertions that have no basis in fact, but merely seem to you to fit your 
argument, facts you already assume to be true and thus are convenient for 
you to adopt.  Try the reverse, come up with the facts first THEN move to 
the premise.

> as for my `day job', parry meztger asked about this too. well, pick one
> of the following
> 
> 1) bored millionaire with nothing better to do than go to drug parties
> and hang out in cyberspace, using all kinds of infantile pranks with
> pseudonyms...

You're far to narrow to be rich.

> 2) shearson-lehman brokerage agent, dealing with computerized trading
> strategies, sometimes `libertarian lecturer', with a real jekyll-and-hyde
> cyberpersonality

If you understood financial structure, this might have more credibility 
than it does. (Still limited regardless)

> 3) working with Ted Nelson on the Xanadoodoo project as a consultant,
> building a `digital bank' on the internet at a glacialy slow pace.

Again, the financial ignorance.

> 4) entrepreneur starting a new internet company specializing in mailing
> lists, pseudonyms, etc.

"Self Employed."  I think this is closer.

> 5) GIS consultant working on database design for power companies

Better get to work and off the net, you might get fired if your boss 
walks into the cubical you spend the day in and sees you wasting his paid 
time smearing cheese puffs on the keyboard while goofing off on the net.

> >> we have to fight off these encroaches onto private territory wherever 
> >> they happen. clipper was *not* a surprise given the past nsa history.
> >Clipper is a HUGE surprise considering the NSA history.
> >
> >Two words:
> >Too Public.
> 
> no, i think you can look at their past and see that they were proposing
> subsystems for computers with `tappability' built in long before clipper.
> some of the real old veterans here might be able to confirm this (cyberspace
> has a very short memory)

I'll leave it up to you to decide how the above differs from Clipper and 
the NSA's involvement.  Your failure to identify the distinction just adds 
to my assessment that you have no background in intelligence or financial 
institutions and thus have no business at all making this argument which 
requires no knowledge but in these two areas.

> yes, clipper was the most public nsa program
> ever devised. but remember that the nsa has *never* (that i know of)
> acknowledged building it in official press releases. 
> instead, it is portrayed as an NIST 
> invention built based on presidential directive and the help of `several
> key agencies' (hee hee, love that phrase)

Ok, let's assume your correct, a dubious position.  I'll call this the 
"NIST" front theory.
In some ways it makes sense in that agencies are usually created as an 
insulator the to executive.

> >I attribute the public outing of the NSA to an [unnamed] high administration 
> >official with no concept of the proper application of intelligence 
> >agencies except as a tool to support his dwindling programs.
> 
> i have no idea what you are tallking about.

I don't doubt it.

> `public outing'? the nsa
> cannot accomplish their goal with clipper *without* going public, namely
> to create a tappable worldwide cryptographic standard. yes, there is
> a lot of `save our butts' mentality along with the creation of it.

Now let's go back to your "NIST" front theory.  If the policy is already 
in the open and attributed to NIST, why must the NSA be publically 
involved?  Surely the NIST front was created to mask involvement in some 
way yes?  If this is so, as your reading of the "several key agencies" 
clause seems to suggest, why is the NSA talking publicly?  Why is a NSA 
public relations official straight out of Q43 going to conferences?
How is the NIST front acting to insulate the President here?
A "ClusterFuck" even by your definition.
Mr. Sternlight, care to comment here?

> or are you just talking about the nsa having a higher profile because
> someone thinks they can advance by touting it? i think you are wrong
> there. the people in the nsa have the attitude, almost, that even 
> talking about the existence of the agency to outsiders is a crime.
> and what does anyone outside the agency have to benefit by promoting
> it publicly? they would lose favor with those inside it.

Did you even read my message?

The NSA is being used here.  How can you reconcile the attitude and 
culture the NSA has with your insistence that the NSA must go public when 
even you admit a public front has already be established and the NSA 
need not be involved?  I think you forget what the last paragraph in your 
idea was before writing the next.

My whole point is that the NSA is being manipulated as a public relations 
tool and this is silly and betrays a total lack of intelligence 
experience by whoever is directing them.  Gee, I wonder, who's program is 
it now that the NSA is supporting?  Who might stand to gain from having 
that program succeed?  Who is probably then directing the NSA to support 
the program in public?  You really don't know anything about intelligence 
do you?

> >The fact that the NSA is publicly supporting clipper betrays fear by the 
> >administration, the improper use of the agency, and a great deal of 
> >ignorance in intelligence in general.  I might add that in my personal 
> >opinion it is a perversion.
> 
> it appears the executive branch was not fully involved in the
> clipper decisions. this is really patently obvious.

Patently obvious?  You only support it with your assumptions which I will 
now challenge, hardly obvious.

> clipper was
> developed more or less independently by the nsa and then passed off
> as a `presidential directive'. i agree it is a perversion. but the overwhelming
> evidence is that it originated inside the agency, not outside it.

Clipper was an offshoot of the public key technology.  The effort on 
Clipper strings back to the Bush/Reagan era.  NSA is not a policy agency.
They came up with the technology because that's what they are paid to do.  
Applications for the technology are suggested, but it's up to other 
authority to apply it in practice.  It's called the take care clause.  
Suggesting that Clipper, including the policy decisions, is an NSA 
creation is ignorant.  The technology might be an NSA invention, or 
theft, the Clipper program is not.

> >> it would *not* be surprising if the nsa got into the digital cash
> >> design area in the future, or expanded its role in the current one.
> >
> >Yes it would.  This is not the function of the NSA.  The NSA either 
> >performs communications and signal intelligence or functions as an 
> >appropriations agency for secure communications channels for government.  
> 
> oh, i see, and how is the nation's cash system not a `secure communication
> channel for the government'?  what do you think it means on your bills
> where it says, `this is legal tender for all debts, public or private'?
> cash is the *embodiment* of an official government `secure' channel.
> the fact that it is paper-based is merely a coincidence.

You do babble don't you.

Your theory that the NSA seeks to control federal financial transactions 
and to develop a digital cash system to further that goal has nothing to 
do with the text on a bill.  You think the NSA established the ATM 
network outside of the DES derivative it may use?  That alone 
disqualifies you as an authority on the point.

> you refuse to even ponder my basic point: the nsa has a history
> of trying to glom onto new areas of conquest. a cash system would be 
> something they eye very greedily. what prevents it? *nothing*.

I refuse to ponder your point because it implodes when touched.

You treat the intelligence agencies as a separate policy making arm of 
the government not as a tool of the executive.

> ask
> anyone several months before clipper came out, and they would be saying
> >This is not the function of the NSA.  The NSA either 
> >performs communications and signal intelligence or functions as an 
> >appropriations agency for secure communications channels for government.  
> ...
> 
> >The contemporary trend to use the agency for anything from public 
> >relations and government regulations is a mistake of application by the 
> >current administration.  The NSA is enjoying its moment in the spotlight 
> >for the time, but at the core this is a secret agency. 
> 
> yes, but they are finding that trying to be secret and accomplish the
> goal of limiting cryptography are mutually exlusive goals. and this
> has *nothing* to do with the `current administration'. clipper originated
> long before the clintons.

"They" as in the NSA?
(Sigh)  Do you hear nothing?

The NSA may have suggested that certain technologies were going to loosen 
their grip on domestic COMINT/SIGINT.  How this makes the NSA a policy 
arm is beyond me, and I think even you.

I might add that limiting cryptography is hardly a goal mutually 
exclusive with secrecy.  You illuminated this yourself when you mentioned 
the "NIST" front theory.  The NSA does not HAVE to be involved here.  You 
have yet to show me otherwise.

> > One of two 
> >things will happen (and I would argue one of these already has)
> >
> >1>  The responsibility for the darker activities the NSA is (was) 
> >responsible for will be switched.
> 
> what `darker activities'? money laundering?! hee, hee, you better go
> reread your bamford.

See above for money laundering discussion.
See above for suggestions on topics to read up on.

> >2>  The NSA will grow tired of its moments in the limelight and realize 
> >that serious business needs to be attended to.
> 
> what business?! i repeat, no one in the NSA wants to `be in the limelight'
> and clipper is no such attempt to do so. do you think clipper is dead now?
> if so, you are wrong.  public outcry means *nothing* against government
> obstinacy.

You seem to have switched your position pretty quickly.  

Compare:
> yes, but they are finding that trying to be secret and accomplish the
> goal of limiting cryptography are mutually exlusive goals.

With:
>i repeat, no one in the NSA wants to `be in the limelight'
> and clipper is no such attempt to do so
      ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
It is left to the reader to harmonize these two.


> >The NSA is always better off when no one is talking about the NSA.
> 
> this sounds like a trite cliche from someone in the agency. i agree, but where
> does that leave clipper? how is it you can write so much about the nsa without
> using that word?

It leaves Clipper in trouble.  Never involve an intelligence agency in 
public affairs that might attract press and public opinion.  Silly.  Who 
might be responsible for this?  What a clod.

But I do have a great deal of respect for the Office of the Presidency.

> do you think they will abandon it? that is the only way
> they can stop being the object of widespread public ridicule.

Which is why, in part, that the publicity was a mistake.

 the
> nsa has two basic agendas:
>
> 1) intercept/restrict/control cryptography
> 2) do so secretly

Wrong.

1)  Provide for government communications security.
2)  Provide and insure continued SIGINT/COMINT ability.

> 
> these two goals are fundamentally incompatible in 21st century cyberspace.
> in fact, i would argue they are both fundamentally impossible. die, nsa, die.

You mean, you would tell us that your going to argue this point, but then 
not support it.  These goals are not incompatible even if they were 
the goals of the NSA.  
 
> >An NSA that participates in the public restructuring of a basic financial 
> >system on any level beyond the development of the technology is just 
> >not in line with an agency that has better security on the local power 
> >stations than the President has in general.
> 
> `local power stations'?!?! what the !@#$%^&* are you talking about?

I guess you've never been to Fort Meade, Maryland.  My mistake.

> if
> you think the nsa cares what the presidents [sic] thinks, you are mostly 
mistaken.
> the nsa cares about how to get the president to think what they want him to
> think.

Who do you suppose directs the appointment of NSA?
Are you arguing that the NSA is unaccountable?

Study political science as well as Financial Institutions and Intelligence.


> >> (erik hughes's OTHER testicle <g>)
> >> 
> >
> >I don't think so.
> >Eric's testicles are surely much larger than you.
> 
> really? how big were they last time you checked? <g>

Eric has more balls than you ever will my friend.

> btw, someone said that `testicle' is a pun of `tentacle'. could someone
> tell me what a `tentacle' is? how does this relate to the d-stuff?
> just curious. uh, maybe nevermind <g>
> 

-uni- (Dark)