From: tcmay@got.net (Timothy C. May)
Date: Mon, 6 Nov 1995 02:01:20 +0800
To: cypherpunks@toad.com
Subject: "The Policeman Inside"
Message-ID: <acc2319202021004e8ac@[205.199.118.202]>
MIME-Version: 1.0
Content-Type: text/plain


At 12:35 PM 11/5/95, Mats Bergstrom wrote:

>Well, also in Sweden, but this is merely against tax money transfered to
>the 'less fortunate' (or 'lazy', as you sometimes call them) and is very
>little, if at all, connected to anti-surveillance. Cross-referencing
>various databases would actually be good for catching those who receive,
>for example, unemploment money while actually working full time (especially
>common amongst Mediterranian and Middle East 'political' refugees - many
>of whom like to come here and work for a handful of years, sometimes adding
>a decade to their actual age so they can go home to a warm climate at 55
>to live as kings on their Swedish pensions). Isn't this a dilemma, also at
>your home turf? FINCEN efficiency might save some of your tax dollars.
                 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Mats' point is an important issue to think about. The "conservative" who
wants to get the bums off welfare and keep his hard-earned kroners or
francs may embrace a FinCEN-type computerized police state. In a system of
extensive transfer payments, such "person number" tracking is needed to
ensure that Citizen Units do not make double claims, do not retire before
they have made their full productive contribution to the welfare of the
herd, and so on.

A "libertarian" would argue that when economic interactions are uncoerced,
when there are few if any lay-abouts collecting food stamps, welfare, AFDC,
WICC, generous pensions paid by taxpayers, etc., then the "need" for
Citizen Unit identification vanishes.

This actually has some crypto relevance, besides the obvious crypto anarchy
connections. Nameley, parallels with "offline" and "online" clearing.

A system in which pieces of paper and various promissory notes are
transferred around as money, with later (offline) clearing, tends to
require True Names. This so that defaulting parties can be tracked down and
collected from. (And of course there are also tax issues, and regulatory
issues, but I'm concentrating on the offline or deferred clearing issues
that tend to make True Names and physical identities more important.)

By contrast, a cash economy--online or immediate clearing--tends to not
require identification. "Cash and carry," which has worked for millenia in
diverse cultures which have no forms of identification. One pays in corn,
or beads, or gold, and that's that.  (There are, as Futplex noted I like to
say, "lots of issues." We could discuss exceptions to this, such as
contracts, age credentials, etc. But, generally, cash transactions tend to
produce no compelling need for identification. This is the norm in most
retail transactions, unless "checks" or other forms of deferred clearing
payment are tendered.)

The modern "identity state" is becoming consumed with the notion that
everyone needs an index number. Not necessarily because the police want to
compile dossiers on them (though this is a factor), but because of the
focus on rules and regulations which affect _monetary flows based on
identity_.

In the U.S. for example, one used to just be able to pay someone to cut
one's lawn in cash (or check, if he trusted you, blah blah) or babysit
one's children. Now, under new crackdowns on social security laws, income
tax estimated payment laws, hiring of undocumented workers laws, etc., this
is technically no longer possible. One must, above some tiny threshold of
payments, file various tax and social security forms, and take steps to
ensure the worker is properly documented (*)

(* Most white people in America have little "proof" that they are proper
Citizen Units. This leads to uncomfortable situations where only brown- and
yellow-skinned persons are asked to prove their identities and their
Citizen Unit or Resident Unit status.)

There is strong pressure on several fronts to establish a "National
Identification Card." Others are opposed.

My point, originally, to Rich Graves' mention of Chris Hibbert's excellent
FAQ on Social Security Numbers and person numbers, is that it is no longer
relevant to fight against a "single index number." Modern data base methods
are so well-suited to cross-indexing that it hardly matters whether there's
a single point of entry to the data base or not.

THE KEY POINT IS THIS: Are voluntary economic transactions between persons
to be subject to approval and regulation by the State? If babysitting and
lawnmowing, not to mention hiring someone to write some C code, requires
submitting tax and Social Security forms, requires checking the J-1 vs.
Permanent Resident vs. Approved Citizen Unit status, then the die is cast.

Ordinarily, or in earlier years, these rules might have been dismissed as
trivial or as mostly ignorable. After all, so long as one is not planning
to become Attorney General, who cares whether a housekeeper was "legal" or
not? Who cares whether the detailed Social Security, IRS, and Immigration
Control forms were filled out properly, or at all?

Well, the State is becoming more efficient in tracking such things, and tax
penalties are increasing. Further, bounties are being paid to those who
inform on "tax cheats." Computerized records are being used to spot those
with "apparent incomes" (= lifestyles) inconsistent with their tax filing
status.

Sure, part of this is to catch "double dippers," such as those collecting
unemployment, welfare, AFDC, disability benefits while also doing work on
the side. (There's a whole issue here of the laws about welfare recipients
not being allowed to work, which I won't get into.)

But the danger, and something that should inform our Cypherpunks
discussions, is that these laws which are tied to one's status as a Person
Unit in the system, inevitably require an extensive "identity tracking"
regimen.

The libertarian and anarcho-capitalist solution is not to increase the
power of the surveillance state to detect fraud and non-compliance, but to
roll things back to a more even keel.

Even if one believes taxes are "the price paid for civilization," there are
superior alternatives to the current system. (My current favorite is:
mandatory slavery for X days per year, regardless of age or ability.
Instead of taxes, everyone works one day in five, or 2 months out of the
year, etc., for the herd. Building roads, picking up trash, administering
computers, etc. There are "lots of issues," but even I agree this list is
not the best place to discuss it; I mention it in passing.)

In closing, we must beware "the policeman inside," to use the William
Burroughs term. A surveillance state that arises because modern computers
and data bases allow all economic transactions to be monitored, taxed, and
approved or disapproved is a horror we should fight with all of our
resources. Whether right-, left-, or libertarian-leaning, the implications
of this state power to control our lives are horrible.

--Tim May

Views here are not the views of my Internet Service Provider or Government.
---------:---------:---------:---------:---------:---------:---------:----
Timothy C. May              | Crypto Anarchy: encryption, digital money,
tcmay@got.net  408-728-0152 | anonymous networks, digital pseudonyms, zero
Corralitos, CA              | knowledge, reputations, information markets,
Higher Power: 2^756839      | black markets, collapse of governments.
"National borders are just speed bumps on the information superhighway."