From: harry@starbase.sj.unisys.com
Date: Thu, 12 May 1994 10:51:07 -0700
To: bmah@tenet.icsi.berkeley.edu (Bruce Mah)
Subject: Postal Service and IRS mull national identity cards (fwd)
Message-ID: <9405121745.AA09141@ctnews2.sj.unisys.com>
MIME-Version: 1.0
Content-Type: text/plain


I know you are interested in electronic privacy issues, so I thought
you would like to see the following article.  Yikes!

							-- Harry




Subject: Postal Service and IRS mull national identity cards

Forwarded-by: bostic@vangogh.CS.Berkeley.EDU (Keith Bostic)
Forwarded-by: kole@hydra.convex.com (John P. Kole)
Forwarded-by: cavasin@bach.convex.com (Vince Cavasin)
>From Digital Media, May 9, 1994.

EVER FEEL LIKE YOU'RE BEING WATCHED? YOU WILL....
Postal Service and IRS mull national identity cards, Clinton to sign
orders

Digital Media has learned that the Clinton administration is debating
not if, but how, to create a card that every American will need in order
to interact with any federal government agency. Combined with two
potential executive orders and the Postal Service's designs on putting
its stamp on personal and business electronic transactions, the card could
open a window on every nuance of American personal and business
life.

The wrangling among the administration, the U.S. Postal Service, the
Internal Revenue Service and Department of Defense, emerged into the
public eye at this April's CardTech/SecureTech Conference. The
gathering of security experts was convened to discuss applications for
smart card and PCMCIA memory card technologies in business and
government. The Postal Service, at the conference presented a proposal
for a "general purpose U.S. services smartcard," which individuals and
companies would use to authenticate their identities when sending and
receiving electronic mail, transferring funds and interacting with
government agencies, such as the I.R.S., Veterans Administration and
the Department of Health and Human Services.

President Clinton is also considering signing two executive orders that
would greatly expand the government's access to personal records,
including an order that would allow the I.R.S. to monitor individual
bank accounts and automatically collect taxes based on the results,
said sources close to the White House. The collection service will be
presented as a convenient way to avoid filling out a tax return. The
White House did not respond to requests for comments about this
report.

The Post Office: We deliver for you. The Postal Service's U.S. Card
would be designed to use either smart cards (plastic cards with an
embedded microprocessor carrying a unique number that can be read
by a electromagnetic scanner and linked to computerized records
stored on a network) or PCMCIA cards, which can contain megabytes
of personal information. (You've probably seen this type card in AT&T's
"You Will" ad campaign, which shows a doctor inserting a woman's
card in a reader in order to access a recording of a sonogram). The
Postal Service said it is considering AT&T and other companies' smart
card technologies.

In a slide presentation at the conference, Postal representative Chuck
Chamberlain outlined how an individual's U.S. Card would be
automatically connected with the Department of Health and Human
Services, the U.S. Treasury, the I.R.S., the banking system, and a
central database of digital signatures for use in authenticating
electronic mail and transactions. The U.S. Card is only a proposal,
Chamberlain insists.  Yet the Postal Service is prepared to put more
than a hundred million of the cards in citizens' pockets within months
of administration approval, he said.

"We've been trying to convince people [in the different agencies] to do
just one card, otherwise, we're going to end up with two or three
cards," said Chamberlain. He said in addition to the healthcare card
proposed by President Clinton last year, various government agencies
are forwarding plans for a personal records card and a transactions (or
"e-purse") card. Chamberlain said the I.R.S  in particular is pursuing
plans for an identity card for taxpayers.

Don't leave home without it. Though he did not name the U.S. Card at
the time, Postmaster General Marvin Runyon suggested that the Postal
Service offer electronic mail certification services during testimony
before the Senate Governmental Affairs Subcommittee in March. The
proposal is clearly intended as a way to sustain the Postal Service's
national role in the information age, since it would give the agency a
role in virtually every legally-binding electronic transaction made by
U.S. citizens.  For instance:

% When sending or receiving electronic mail, U.S. Card users would be
able to check the authenticity of a digital signature to screen out
impostors.
% Banking transactions (notably credit card purchases) that depend on
authentication of the participants identities and an audit trail, would
be registered in Postal Service systems.
% Veterans, or for that matter college students and welfare recipients,
could check their federal benefits using the identification data on their
U.S. Cards.
% Visitors to an emergency room would have instant access to medical
records at other hospitals, as well as their health insurance information.

These examples may seem benign separately, but collectively they paint
a picture of a citizen's or business's existence that could be
meddlesome at best and downright totalitarian at worst. Will buying a
book at a gay bookstore with a credit card that authenticates the
transaction through the Postal Service open a Naval officer up to court
martial? If you have lunch with a business associate on a Saturday at
a family restaurant, will the IRS rule the expense non-deductible before
you can even claim it?

"There won't be anything you do in business that won't be collected and
analyzed by the government," said William Murray, an information system
security consultant to Deloitte and Touche who saw Chamberlain's
presentation. "This [National Information Infrastructure] is a better
surveillance mechanism than Orwell or the government could have
imagined. This goddamned thing is so pervasive and the propensity to
connect to it is so great that it's unstoppable."

Deep Roots; Deep Pockets; Long History. Chamberlain said the Postal
Service has been working for "a couple years" on the information
system to back up the U.S. Card. He said the project was initiated by
the Department of Defense, which wanted a civilian agency to create a
national electronic communications certification authority that could
be connected to its Defense Messaging System. Chamberlain said the
Postal Service has also consulted with the National Security Agency,
proponents of the Clipper encryption chip which hides the contents of
messages from all but government agencies, like law enforcement. The
National Aeronautics and Space Administration's Ames Research Laboratories in
Mountain View, Calif. carried out the research and development work
for Clipper.

"We're designing a national framework for supporting business-quality
authentication," said John Yin, the engineer heading up the U.S. Card-
related research for NASA Ames' advanced networking applications
group. "This is not specifically with just the Postal Service. We'll be
offering services to other agencies and to third-party commercial
companies that want to build other services on the card." For example,
VISA or American Express could link their credit services to the U.S. Card.

Yin, who works on Defense Messaging Systems applications, said his
group has collaborated with "elements of Department of Defense" for
the past year, but would not confirm the participation of the National
Security Agency, a Department of Defense agency. The NSA is
specifically prohibited from creating public encryption systems by the
Computer Security Act of 1987. Yin also would not comment on the
budget for the project, which other sources said was quite large and
has spanned more than two years.

A false sense of security? According to Yin, the cards would allow
individuals or businesses to choose any encryption technology. "It's
not our approach to say, 'Here's the standard, take it our leave it,'"
he said.

"We're not trying to create a monopoly, rather it's an infrastructure
for interoperability on which a whole variety of services can be built."
Yet, NASA, which is a participant in the CommerceNet electric
marketplace consortium will "suggest" to its partners that they adopt
the U.S. Card certification infrastructure, he said.

The reality is that government agencies' buying power usually drives
the market to adopt a particular technology -- not unlike the way the
Texas Board of Education, the largest single purchaser of textbooks in
the U.S., sets the standard for the content of American classroom
curricula. Since, the administration has already mandated use of Clipper
and its data-oriented sibling, the Tesserae chip, in federal systems
it's fairly certain that the law enforcement-endorsed chips will find
their way into most, if not all, U.S. Cards. Even in the unlikely event
that one government agency should weather the pressure and pass on the
Clipper chip, it's still possible to trace the source, destination,
duration and time of transactions conducted between Clippered and
non-Clippered devices.

"Most of this shift [in privacy policy] is apparently being done by
executive order at the initiative of bureaucracy, and without any
Congressional oversight or Congressional concurrence, " Murray said.
"They are not likely to fail. You know, Orwell said that bureaucrats,
simply doing what bureaucrats do, without motivation or intent, will
use technology to enslave the people."

EDITOR'S NOTE: Digital Media has filed a Freedom of Information Act
request for Clinton and Bush Administration, Postal Service, NSA,
Department of Defense, NASA, I.R.S. and other documents related to
the creation of the U.S. Card proposal.

-- Mitch Ratcliffe

Copyright 1994 by Mitch Ratcliffe and Seybold Publications.

Digital Media: A Seybold Report
444 De Haro St., Ste. 128
San Francisco, Calif. 94107
415.575.3775
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Mitch Ratcliffe
Editor in Chief
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