From: Hal <hfinney@shell.portal.com>
Date: Mon, 13 Feb 95 22:41:38 PST
To: cypherpunks@toad.com
Subject: Internationalism no panacea
Message-ID: <199502140641.WAA18400@jobe.shell.portal.com>
MIME-Version: 1.0
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Two recent news stories cast doubt on the principle that the international
aspects of the nets will prevent governments from enforcing their laws
"in cyberspace".

One is the possible trade war between the U.S. and China over that
country's continued support of intellectual property piracy, in video,
audio, and computer software.  Apparently the U.S. is very serious about
imposing sanctions because of this problem, while China is threatening
retaliation.  It is quite amazing to me to see these two big countries
going to the mat over "just bits" but as we know bits are big business
now.

Think of our recent discussions of putting data havens offshore.  If the
U.S. is willing to turn the screws on a nuclear power like China, how
much protection will some dinky Caribbean country offer when people make
Windows 96 and Jurassic II available for download for $5 ecash?  IMO the
trend is going to be toward international enforcement efforts, a general
movement towards uniform information laws.

The other story related to the idea that individuals can evade laws by
moving from country to country as tourists.  Apparently in the recent
budget bill was a little-publicized change in the tax treatement of
people who renounce their U.S. citizenship.  (The change would be retroactive
to last week and was kept quiet until then to prevent a surge of people
leaving.)  Since you earned all your assets as a citizen of the U.S.,
naturally when you leave the grasp of that country you will not longer
get to take it all with you.  Instead you will apparently have to pay
capital gain taxes on some substantial fraction of your assets.

The article I read went on to discuss the problems many countries are
having with people playing citizenship games.  The implication was that
this may be just one step in a crackdown to close many of the loopholes
that allow people to travel under one flag or another.

My take on this is that human ingenuity is sufficient that there will
always be new loopholes found, and that a sufficiently energetic and
motivated person will probably be able to stay one step ahead of the
enforcers.  However, this will not be a lifestyle that can be turned into
a cookbook; as soon as some trick became widely known, the loophole would
be closed.  So this is something which will be available to an elite but
not to the masses.  Hence I don't see "perpetual tourism" as something
which will be a serious threat to government power.

My views are somewhat iconoclastic for this list; I don't see
cryptography as bringing about a libertarian/anarchist state.  I continue
to believe that the best and only way to achieve freedom for the mass of
people is to convince them that it is a good idea.  A small elite can and
will continue to be able to avoid many laws, and crypto will no doubt be
useful to them.  But IMO it is not going to change the shape of society.

Hal

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