- Spitfire List - http://spitfirelist.com -

FTR #867 Because They Can, Part 3: Fireside Rant about Technocratic Fascism as “Cyber-Crowleyism”

Dave Emory’s entire life­time of work is avail­able on a flash drive that can be obtained here. [1] The new drive is a 32-gigabyte drive that is current as of the programs and articles posted by late spring of 2015. The new drive (available for a tax-deductible contribution of $65.00 or more) contains FTR #850 [1].  

WFMU-FM is podcasting For The Record–You can subscribe to the podcast HERE [2].

You can subscribe to e-mail alerts from Spitfirelist.com HERE [3]

You can subscribe to RSS feed from Spitfirelist.com HERE [4].

You can subscribe to the comments made on programs and posts–an excellent source of information in, and of, itself HERE [5].

This program was recorded in one, 60-minute segment.  [6]


Is this Julian Assange?


Snowden unplugged

Introduction: Reinforcing and clarifying a topic analyzed in recent broadcasts, we ruminate about the subject of what Mr. Emory calls “technocratic fascism.”

The underlying ethos of “technocratic fascism” might be called “Cyber-Crowleyism”–“Do as thou wilt.”

Once again, the world of technocratic fascism should be viewed against the background of a vitally important article by David Golumbia. [9] ” . . . . Such tech­no­cratic beliefs are wide­spread in our world today, espe­cially in the enclaves of dig­i­tal enthu­si­asts, whether or not they are part of the giant corporate-digital leviathanHack­ers (“civic,” “eth­i­cal,” “white” and “black” hat alike), hack­tivists, Wik­iLeaks fans [and Julian Assange et al–D. E.], Anony­mous “mem­bers,” even Edward Snow­den him­self [10] walk hand-in-hand with Face­book and Google in telling us that coders don’t just have good things to con­tribute to the polit­i­cal world, but that the polit­i­cal world is theirs to do with what they want, and the rest of us should stay out of it: the polit­i­cal world is bro­ken, they appear to think (rightly, at least in part), and the solu­tion to that, they think (wrongly, at least for the most part), is for pro­gram­mers to take polit­i­cal mat­ters into their own hands. . . First, [Tor co-creator] Din­gle­dine claimed that Tor must be sup­ported because it fol­lows directly from a fun­da­men­tal “right to pri­vacy.” Yet when pressed—and not that hard—he admits that what he means by “right to pri­vacy” is not what any human rights body or “par­tic­u­lar legal regime” has meant by it. Instead of talk­ing about how human rights are pro­tected, he asserts that human rights are nat­ural rights and that these nat­ural rights cre­ate nat­ural law that is prop­erly enforced by enti­ties above and out­side of demo­c­ra­tic poli­tiesWhere the UN’s Uni­ver­sal Dec­la­ra­tion on Human Rights [11] of 1948 is very clear that states and bod­ies like the UN to which states belong are the exclu­sive guar­an­tors of human rights, what­ever the ori­gin of those rights, Din­gle­dine asserts that a small group of soft­ware devel­op­ers can assign to them­selves that role, and that mem­bers of demo­c­ra­tic poli­ties have no choice but to accept them hav­ing that role. . . Fur­ther, it is hard not to notice that the appeal to nat­ural rights is today most often asso­ci­ated with the polit­i­cal right, for a vari­ety of rea­sons (ur-neocon Leo Strauss was one of the most promi­nent 20th cen­tury pro­po­nents of these views [12]). We aren’t sup­posed to endorse Tor because we endorse the right: it’s sup­posed to be above the left/right dis­tinc­tion. But it isn’t. . . .

[13]Drawing together a number of seemingly disparate analytical and ideological trends, we note the similarity in the corporatist, free-market ideology [14] of Edward Snowden with the Republican Party and its Tea Party faction, the advocates of digital currency [15] and the financial institutions that helped engineer the 2008 financial collapse.

Advocating their right to privacy in the wake of the Snowden “op,” the major players in the 2008 collapse [16] are collaborating in a new, end-to-end encryption messaging service.

” . . . . The company’s back­ers include a who’s who of Wall Street finan­cial com­pa­nies: Bank of Amer­ica Mer­rill Lynch, BNY Mel­lon, Black­Rock, Citadel, Citi, Credit Suisse, Deutsche Bank, Gold­man Sachs, HSBC, Jef­feries, JPMor­gan, Mav­er­ick, Mor­gan Stan­ley, Nomura and Wells Fargo. . . . .”

The Symphony service may well permit them to circumvent regulation [17].

“. . . . The New York Post has previously reported that Symphony deleted a video from its website that bragged its software could help banks avoid billions in fines by making data deletion easier. . . . Our government officials are concerned that their inability to monitor end-to-end encrypted devices inhibits their role in keeping America safe. Conversely, Americans are concerned about preserving their right to Privacy, and encryption helps individuals enforce that right,” read that post. . . .”

Much of the program details the political reality of Indian Prime Minister Narendra Modi’s government.

 In FTR #795 [18], we noted that Narendra Modi was politically evolved from the Hindu nationalist/fascist milieu of the RSS. (An “alumnus” of that political environment murdered Gandhi.)

In addition, we have seen that Modi’s election was heavily buttressed [19] by Ebay’s Pierre Omidyar, who has underwritten Glenn Greenwald’s recent journalistic ventures and partially bankrolled [20] the 2014 Ukraine coup that brought the heirs of the OUN/B to power.

Modi is implementing the laissez-faire agenda favored by Omidyar, a cynical “corporatist” agenda that is poised to restore child labor in India.

The laissez-faire/corporatist agenda championed by Omidyar and Morsi is at one with the “austerity” doctrine promulgated by the GOP, Germany, Edward Snowden, Julian Assange, the IMF and the Underground Reich.

“Get to work, kids! And be sure to bring your wages home to your [unemployed] mom and dad.”

In FTR #866 [21], we examined Silicon Valley’s extravagant, almost erotic celebration of Modi, whose political career and BJP Party are inextricably linked with the RSS, a Hindu nationalist/fascist party.

Underscoring the hypocrisy of the “libertarians” who fawned over Modi and the moral, philosophical bankruptcy of their orientation, we note what Modi is actually dong in India.

In Modi’s India, anyone taking issue with the Hindu nationalist/fascist dogma of the RSS, BJP and Modi himself faces potentially lethal censorship [22].

We note that, just as political dissidents and civil libertarians are being murdered in India by the political forces empowered in part by EBay’s Pierre Omidyar, Ukraine is being beset by political murder [23] as well. (Omidyar helped finance the Maidan coup in Ukraine, as well as the political ascent of Modi and his BJP.)

Program Highlights Include:

 1. In assessing The Adventures of Eddie the Friendly Spook [Snowden], WikiLeaks and the operations of Big Tech, it is vital to remember the ethical and civic considerations of what “coders” and their allies are doing.

For openers, these people are not “whistle blowers” by any stretch of the imagination. If someone, in or out of the military, sees something illegal being done and alerts the press and/or the “proper authorities,” THAT is whistle blowing.

Bradley Manning was no “whistle blower.” He arrogated to himself the right to purloin 700,000 secret intelligence files, which he could not possibly have had the time to read. That is, in and of itself, reckless. He gave those to WikiLeaks and Julian Assange (more about him later.) THAT is not whistle blowing.

Assange and his close associate Holocaust-denier Joran Jermas (aka “Israel Shamir”) arranged for WikiLeaks to be hosted on the Pirate Bay site, financed by prominent Swedish fascist Carl Lundstrom, part of David Duke’s milieu. Does THAT seem responsible?

Edward Snowden purloined 2.7 million secret files about the NSA, which he could not POSSIBLY have had the time to read. THAT is not whistle blowing. He then gave them to Nazi fellow-traveler Glenn Greenwald, as well as WikiLeaks. That is extremely reckless.

What is fundamentally missing here is responsibility–Assange, Snowden et al embody what might be termed “cyber-Crowleyism.” “Do As Thou Wilt”–that was Crowley’s ethic and it seems to have been adopted by the coders, from Assange et al to Big Tech.

Who vetted Snowden, Assange and Greenwald et al? What oversight do they have?

2. Worth noting for our purposes is The Family’s emphasis on a quasi-Nazi, eugenics-like emphasis on “breeding.” (As discussed in FTR #724 [26], Assange appears to have been a member of this cult.)

Unseen, Unheard,Unknown by Sarah Moore. [27]

. . . . I suspect perhaps that there were more sinister motives than these alone. Some of us had multiple birth certificates and passports, and citizenship of more than one country. Only she knows why this was and why we were also all dressed alike, why most of us even had our hair dyed identically blond.

I can only conjecture because I will never know for sure. However I suspect that she went to such great lengths in order to enable her to move children around, in and out of the country. Perhaps even to be sold overseas. I’m sure there is a market somewhere in the world for small blond children with no traceable identities. If she did it, it was a perfect scam. Many ex-sect members have said that they were aware that Anne was creating children by a “breeding program” in the late 1960s. These were ‘invisible’ kids, because they had no papers and there is no proof that they ever existed. Yet we Hamilton-Byrne children had multiple identities. These identities could perhaps have been loaned to other children and the similarity of our appearance used to cover up their absence. One little blond kid looks very like another in a passport photo. . .

. . . We were to be the ones who would carry on the work of the sect – we were a direct reflection on her – so she was intimately concerned about our appearances. She used to talk a lot about “breeding” and talk about us being from the “right stock”. . . .

3. Assange, himself, seems to possess a Darwinian world-view  (and perhaps a reproductive instinct) that is consistent with what is taught to The Family. (This was discussed in FTR #745 [28].)

Inside WikiLeaks: My Time with Julian Assange at the World’s Most Dangerous Website by Daniel Domscheit-Berg; English translation copyright 2011 by Crown Publishers [Random House imprint]; ISBN 978-0-307-95191-5; p. 211. [29]

. . . We often discussed the theory of evolution. If he did have faith in anything, it was the theory of evolution. Julian thought that the stronger members of the species not only prevailed, but produced heirs who were better able to survive. Naturally, in his view, his genes particularly deserved to be reproduced.

Often, I sat in larger groups and listened to Julian boast about how many children he had fathered in various parts of the world. He seemed to enjoy the idea of lots and lots of little Julians, one on every continent. Whether he took care of any of these alleged children, or whether they existed at all, was another question. . . .

4. Excerpt­ing some of Snowden’s 2009 online musings–crafted dur­ing the same time period in which he decided to leak NSA documents–gives us insight into his true nature. We’ve men­tioned Snowden’s embrace of the gold stan­dard, belief that we should elim­i­nate Social Secu­rity and deep affin­ity for Ron Paul. Per­haps exam­in­ing his actual pro­nounce­ments will prove educational.

“Would You Feel Dif­fer­ently About Snow­den, Green­wald, and Assange If You Knew What They Really Thought?” by Sean Wilentz; The New Repub­lic; 1/19/2014. [14]

[Snow­den is post­ing under the moniker “The True­HOOHA”] At the time the stim­u­lus bill was being debated, Snow­den also con­demned Obama’s eco­nomic poli­cies as part of a delib­er­ate scheme “to devalue the cur­rency absolutely as fast as the­o­ret­i­cally pos­si­ble.” (He favored Ron Paul’s call for the United States to return to the gold stan­dard.) The social dis­lo­ca­tions of the finan­cial col­lapse both­ered him not at all. “Almost every­one was self-employed prior to 1900,” he asserted. “Why is 12% employ­ment [sic] so ter­ri­fy­ing?” In another chat-room exchange, Snow­den debated the mer­its of Social Security:

<TheTrue­HOOHA> save money? cut this social secu­rity bullshit

<User 11> hahahayes

<User 18> Yeah! Fuck old people!

<User 11> social secu­rity is bullshit

<User 11> let’s just toss old peo­ple out in the street

<User 18> Old peo­ple could move in with [User11].

<User 11> NOOO

<User 11> they smell funny

<TheTrue­HOOHA> Some­how, our soci­ety man­aged to make it hun­dreds of years with­out social secu­rity just fine . . . .

<TheTrue­HOOHA> Mag­i­cally the world changed after the New Deal, and old peo­ple became made of glass.

Later in the same ses­sion, Snow­den wrote that the elderly “wouldn’t be fuck­ing help­less if you weren’t send­ing them fuck­ing checks to sit on their ass and lay in hos­pi­tals all day.”

5. Symphony’s tune might res­onate with a num­ber of indus­tries besides the financial industry that would also like a super-encrypted com­mu­ni­ca­tion and col­lab­o­ra­tion plat­form and expand­ing into other sec­tors was always part of the plan. Note that the institutions involved with Symphony reads like a “Who’s Who” of the financial institutions that precipitated the crash of 2008!
“Wall Street-Backed Sym­phony Wants To Rev­o­lu­tion­ize Finan­cial Ser­vices Com­mu­ni­ca­tion”  [16]by Ron Miller; Tech Crunch [16] [16]Feb 21, 2015 [16]

Symphony, a com­pany backed by some of the world’s elite finan­cial insti­tu­tions, was cre­ated last fall with a mis­sion to trans­form the way Wall Street shares and col­lab­o­rates around con­tent — and it has set its sights set on some of the world’s most estab­lished con­tent and com­mu­ni­ca­tions tools.

The company’s back­ers include a who’s who of Wall Street finan­cial com­pa­nies: Bank of Amer­ica Mer­rill Lynch, BNY Mel­lon, Black­Rock, Citadel, Citi, Credit Suisse, Deutsche Bank, Gold­man Sachs, HSBC, Jef­feries, JPMor­gan, Mav­er­ick, Mor­gan Stan­ley, Nomura and Wells Fargo.

Last fall, these com­pa­nies con­tributed $66M to finance Sym­phony, and using that money, pur­chased Perzo, a com­pany that was build­ing a secure com­mu­ni­ca­tions plat­form. After the pur­chase, they named Perzo founder David Gurle as Sym­phony CEO.

Gurle, whose back­ground comes right out of busi­ness soft­ware cen­tral cast­ing with stints at Microsoft Lync, Skype and Thom­son Reuters, would seem uniquely qual­i­fied to build such a prod­uct. Symphony’s back­ers have been using a vari­ety of secure com­mu­ni­ca­tions appli­ca­tions and con­tent tools, but that frag­men­ta­tion was becom­ing a huge problem.

They were look­ing to con­sol­i­date on a sin­gle, secure plat­form, and they cre­ated Sym­phony to replace many of the estab­lished play­ers — whether that’s Microsoft Lync or AOL (TechCrunch’s par­ent com­pany) or Yahoo! instant mes­sag­ing in com­mu­ni­ca­tions or Thom­son Reuters and Bloomberg in finan­cial con­tent. The goal from the start has been to become the de facto tool for com­mu­ni­cat­ing, col­lab­o­rat­ing and shar­ing con­tent in a finan­cial ser­vices setting.

“Those com­pa­nies that invested in Sym­phony real­ize they can’t live in a frag­mented way for­ever. It’s not good for busi­ness,” Gurle explained. “They put their money in to make the busi­ness suc­cess­ful and to make Sym­phony suc­cess­ful. You don’t see this align very often,” he said.

Can They Pull It Off?

R Ray Wang, prin­ci­pal at Con­stel­la­tion Research describes Gurle as a vision­ary and believes that Sym­phony is cre­at­ing an entirely new cat­e­gory of soft­ware.

By tar­get­ing the finan­cial ser­vices indus­tries first, they show to every other indus­try from gov­ern­ments to retail that here’s a way to bring these sys­tems of engage­ment to cre­ate dig­i­tal dis­rup­tion in the mar­ket,” Wang told TechCrunch.

“When the orig­i­nal design point is about secu­rity and com­pli­ance to some of the strictest stan­dards set by gov­ern­ments on finan­cial ser­vices, that’s no com­par­i­son to com­pa­nies adding secu­rity on as an after fact,” Wang said.

He added that the core prod­uct Perzo was built for mas­sive shar­ing of mas­sive amounts of infor­ma­tion at financial-services secu­rity scale. He believes Sym­phony has the poten­tial to cre­ate pri­vate col­lab­o­ra­tion net­works and even­tu­ally per­haps even pub­lic ones.

As for that con­tent com­po­nent, Wang says that could be the tough­est part to pull off. “The goal is to be able to burst con­tent with heavy con­text. They have the tech­nol­ogy, but I’m not sure if they have the con­text yet. That takes time,” he said.

Look­ing Ahead

While today the prod­uct focuses pri­mar­ily on the needs of finan­cial ser­vices, Gurle says over time, the con­tent can adapt to the many dif­fer­ent content-centric indus­tries such as life sci­ences, med­i­cine, ship­ping, man­u­fac­tur­ing, account­ing, legal and energy.

For now, Gurle wants to get the finan­cial ser­vices piece right, then he sees going after adja­cent mar­kets like legal and account­ing. After that, per­haps they can begin to go after other indus­tries, but the roadmap is in place now.

The plan is even­tu­ally to cre­ate an open source ecosys­tem around Sym­phony, but Gurle says how that will work and which com­po­nents will go into open source is still very much being debated internally.

The prod­uct has been in Alpha since Jan­u­ary with the 15 fun­ders and a thou­sand daily active users, pre­s­e­lected from pub­lic alphas appli­cants. It plans to go into a wider Beta release with 10,000 users in April and to become gen­er­ally avail­able by the end of June or early July. By that point, the com­pany will have a bet­ter sense of which pieces they will put into open source and which they will con­trol. It could poten­tially oper­ate like Piv­otal, which open sourced pieces of its Big Data Suite [30] last week, while hold­ing other parts back for the com­mer­cial ver­sion, but how it will work with Sym­phony is still being decided.

6a. No one familiar with the nature and behavior of the institutions involved with Symphony would trust them NOT to use the end-to-end encryption to evade regulatory scrutiny and engage in the type of behavior that produced the 2008 financial crash. They now may be able to do that with perfect impunity.

“Wall Street’s New Chat Service Is Deleting Problematic Messaging” by Francine McKenna; MarketWatch; 8/14/2015. [17]

For start-up that says it’s focused on secure messaging, Symphony has been deleting a lot of its own messaging to the public about what it provides for its financial services clients. The firm has been editing out references on its website to data deletion and its ability to help banks keep their data away from the government.

The New York Post has previously reported that Symphony deleted a video from its website that bragged its software could help banks avoid billions in fines by making data deletion easier. Continuing its efforts, Symphony has recently deleted a section about data security from its website and additional references that emphasize more privacy via data encryption and permanent data deletion capabilities.

These were among the removed comments: “End-to-End Encryption: Symphony is completely private. Your data is 100% protected by encryption keys known only by you, never by us.”

“Guaranteed Data Deletion: Symphony has designed a specific set of procedures to guarantee that data deletion is permanent and fully documented.”

A blog post from July entitled, “To Encrypt, or Not to Encrypt?” is also now gone. That post included a passage touting its encryption capabilities as a way to protect firms’ privacy. “Our government officials are concerned that their inability to monitor end-to-end encrypted devices inhibits their role in keeping America safe. Conversely, Americans are concerned about preserving their right to Privacy, and encryption helps individuals enforce that right,” read that post. . . .

. . . . Symphony is no longer promoting messaging security features as a way to prevent the government from getting banks data. Instead, text describes “an ‘end-to-end’ security capability that protects communications from cyber-threats and the risk of a data breach—while safeguarding our customers’ ability to retain records of their messages.” . . . .

. . . . The New York Post report raised some eyebrows. The New York Department of Financial Services’ acting superintendent, Anthony Albanese, sent a letter [31]to Symphony Chief Executive David Gurle on July 22 asking for more information about the video. On Monday, Sen. Elizabeth Warren stepped up the pressure on the firm, as the Massachusetts Democrat sent a letter [32] to six financial regulators raising concerns about Symphony’s description of its new system, “which appear(s) to put companies on notice – with a wink and a nod – that they can use Symphony to reduce compliance and enforcement concerns.” . . . .

6b. Potentially realizing the economic wet dream of fascist/libertarian elements, cryptocurrency may subvert the ability of nation states to tax–a function central to the very concept of civic existence! (We discussed Bitcoin, in FTR #’s 760 [33]764 [34]770 [35]785 [36].)

“Cryptocurrency Taxation May Subvert National Collection” by Travis Patron; Diginomics; 9/06/2015. [15]

As the age of cryptocurrency comes into full force, it will facilitate a subversively viable taxation avoidance strategy for many of the technically savvy users of peer-to-peer cryptographic payment systems. In doing so, cryptocurrency use will act to erode the tax revenue base of national jurisdictions, and ultimately, reposition taxation as a voluntary, pay-for-performance function. In this post, I’d like to cover some of the benefits such a strategy will have for cryptocurrency investors, why our notion of taxation is ripe for disruption, and why cryptocurrency taxation is enabled by default.

Although investors have been lured by the siren song of tax havens for as long as governments have existed, none have existed with the legal and structural characteristics such as those found in cryptocurrency. By operating behind a veil of cybersecrecy, it is reasonable to forecast the impracticality of systemic taxation on these types of financial assets from national jurisdictions. Individual enforcement of taxation is likewise impractical due to ideological backlash governments would receive for targeting individuals who avoid national taxation via information technologies. Even so, many jurisdictions have already declared digital currency transactions (something which occurs between consenting parties on a network which no one owns) to be taxable under current legal frameworks.

How can the state lay claim to the right to tax that which they do not issue and cannot control?

Running The Numbers on Cryptocurrency Taxation

It has been said that compounding interest is one of the most powerful forces in the universe. When we apply the black magic of compounding returns to the profit-maximizing actions of consumers, we see quite clearly why every user aware of the benefits of using cryptocurrency, even if only for the tax-savings, will opt to do so over traditional fiat money. The allure of avoiding the clutches of national taxation is strong enough that any rational consumer will make cryptocurrency a portion of their financial portfolio given they have the sufficient technical understanding.

James Dale Davidson, co-editor of Strategic Investment

“Each $5,000 of annual tax payments made over a 40-year period reduces your net worth by $2.2 million assuming a 10% annual return on your investments,” reports James Dale Davidson in The Sovereign Individual: Mastering the Transition to the Information Age, “For high income earners in predatory tax regimes (such as the United States), you can expect to lose more of your money through cumulative taxation than you will ever earn.”

As we explained in the report Bitcoin May Become A Global Reserve Instrument [37], never before has there existed a tool that can preserve economic and informational assets with such a high degree of security combined with a near-zero marginal cost to the user. This revolutionary capability of the bitcoin network does, and will continue to provide, a subversively lucrative tax super haven in direct correlation with its acceptance on a worldwide basis.

Government Response to Cryptocurrency Taxation

Many government agencies have already cued in to the tax avoidance potential of bitcoin and cryptocurrencies. However, it would seem that they misjudge this emerging threat looming over their precious tax coffers. The Financial Crimes Enforcement Network in the United States (FINCEN) for example, has already issued guidance on cryptocurrency taxation [38], yet makes a false distinction between real currency and virtual currency. FINCEN states that “In contrast to real currency, “virtual” currency is a medium of exchange that operates like a currency in some environments, but does not have all the attributes of real currency,” and later “virtual currency does not have legal tender status in any jurisdiction.” What these agencies fail to realize, is that cryptocurrency is not virtual in any sense of the word. Indeed it is as real, and perhaps even more real, than traditional fleeting fiat currencies.

Bitcoin and cryptocurrency offer a near perfect alternative to traditional tax havens which are being tightly controlled by the new laws associated with the Foreign Account Tax Compliance Act [39] (FATCA). In his report Are Cryptocurrencies Super Tax Havens? [40], Omri Marian makes clear the pressure for financial institutions who interact with the US banking system to hand over account holders, and for a crackdown on offshore tax havens with the enactment of FATCA in 2010.

Tax policymakers seem to be operating under the faulty assumption that cryptocurrency-based economies are limited by the size of virtual economies. The only virtual aspect of cryptocurrencies, however, is their form. Their operation happens within real economies, and as such their growth potential is, at least theoretically, infinite. Such potential, together with recent developments in cryptocurrencies markets, should alert policy-makers to the urgency of the emerging problem.

– Omri Marian, Are Cryptocurrencies Super Tax Havens?

Current payment processors such as BitPay have recently revealed [41] that government agencies are watching cryptocurrency transactions through the bottlenecks and exchanges where it can be tracked and traced with a high degree of transparency. It should not come to anyones surprise that governments are watching cryptocurrency nor that companies are complying with their laws, but understanding why national governments require users of the bitcoin digital economy to cut them a slice of the pie while they contribute nothing to the operation, and in many cases, hinder the adoption of this technology [42], remains a callus mystery.

Governments initially attempting to control cryptocurrency taxation through the businesses and bottlenecks which it can be monitored through will meet with as much success as they have limiting file sharing, illegal downloads, and Tor operations. Cryptocurrencies have an inherent regulation, that of the law from numberTruly, bitcoin is code as law.

Old laws seldom resist the trends of technology. The attempt of government agencies to levy taxation on cryptocurrency transactions directly is as futile as sweeping back waves of the ocean. No matter the size of broom, state actors will be overrun by continuously expanding waves of cryptocurrency adoption.

In the 1980s, it was illegal in the United States to send a fax message. The US Post Office considered faxes to be first-class mail, over which the US Post Office claimed an ancient monopoly … billions of fax messages later, it is unclear whether anyone ever complied with that law.

– James Dale Davidson, William Rees-Mogg, The Sovereign Individual

Cryptocurrency Taxation By Default

What would you say if you were told cryptocurrency taxation occurs on every transaction by default? In the realm of digital currency, the transaction fee which the user decides to (or decides not to) attach to each payment represents the taxation. This user can decide to attach a large fee or no fee at all. In doing so, the miners of the network will choose preference for the transactions with a larger fee attached, and will work to confirm these payments sooner than those with smaller fees. This transactions queue represents a voluntary, pay-for-performance taxation structure where the performance derived from the system is dependent upon how much taxation they pay.

Algorithmic Regulation

Cryptocurrencies have regulation built into the very nature of their existence, just not through our conventional ideas of human intervention. Because of the technological nature of cryptocurrency taxation, judicial regulations bestowed upon these types of systems will always be, to a large degree, futile. Cryptocurrencies have established their own set of rules and guidelines through the source code they are built upon, forcing legal frameworks on this type of 21st century innovation will only cause friction during its adoption phase.

The only choice of regulation we have in terms of cryptocurrency taxation is not to try and fit it inside some existing doctrine, but to abide by their laws of finance and information freedom. We must be the one’s to conform to the regulation, not have it conform to our conventional beliefs. Bitcoin is a system which will only be governed effectively through digital law, an approach which functions solely through a medium of technology itself. It will not bend to the whim of those who still hold conventional forms of law-making as relevant today.

For a successful technology, reality must take precedence over public relations, for nature cannot be fooled.

– Richard Feynman


When we come to understand the systemic resilience to judicial intervention, it becomes quite clear that cryptocurrency taxation will remain a voluntary, pay-for-performance function of the network itself. No longer will taxation be enforced through coercion, but become a voluntary act towards increased system performance.

Make no mistake, in a crypto-anarchist jurisdiction where there is no means to confiscate or control property on behalf of another individual, the need for the state will cease to exist [43]. Mass taxation on digital currency is not feasible through judicial enforcement while individual enforcement is bound to prove ineffective. You, or anyone motivated to retain their net worth, will find a subversively lucrative tax haven in the realm of cryptocurrency.

6c. The rise of “smart contracts” may not only enable the successful perpetration of numerous kinds of criminal undertakings, including the assassination of public officials, but may replace the use of attorneys to draft contracts. It is not only low-wage workers who face unemployment realized through technological replacement! Actually, Bitcoin’s Dark Side is pretty damn dark, as we saw in FTR #’s 760 [33]764 [34]770 [35]785 [36].

“Bitcoin’s Dark Side Could Get Darker”  [25]by Tom Simonite; MIT Tech­nol­ogy Review; 8/13/2015. [25]

Investors see riches in a cryptography-enabled tech­nol­ogy called smart contracts–but it could also offer much to criminals.

Some of the ear­li­est adopters of the dig­i­tal cur­rency Bit­coin were crim­i­nals, who have found it invalu­able in online mar­ket­places for con­tra­band and as pay­ment extorted through lucra­tive “ran­somware” that holds per­sonal data hostage. A new Bitcoin-inspired tech­nol­ogy that some investors believe will be much more use­ful and pow­er­ful may be set to unlock a new wave of crim­i­nal innovation.

That tech­nol­ogy is known as smart contracts—small com­puter pro­grams that can do things like exe­cute finan­cial trades or nota­rize doc­u­ments in a legal agree­ment. Intended to take the place of third-party human admin­is­tra­tors such as lawyers, which are required in many deals and agree­ments, they can ver­ify infor­ma­tion and hold or use funds using sim­i­lar cryp­tog­ra­phy to that which under­pins Bitcoin.

Some com­pa­nies think smart con­tracts could make finan­cial mar­kets more effi­cient, or sim­plify com­plex trans­ac­tions such as prop­erty deals (see “The Startup Meant to Rein­vent What Bit­coin Can Do [44]”)Ari Juels [45], a cryp­tog­ra­pher and pro­fes­sor at the Jacobs Technion-Cornell Insti­tute at Cor­nell Tech, believes they will also be use­ful for ille­gal activity–and, with two col­lab­o­ra­tors, he has demon­strated how.

“In some ways this is the per­fect vehi­cle for crim­i­nal acts, because it’s meant to cre­ate trust in sit­u­a­tions where oth­er­wise it’s dif­fi­cult to achieve,” says Juels.

In a paper to be released today [46], Juels, fel­low Cor­nell pro­fes­sor Elaine Shi [47], and Uni­ver­sity of Mary­land researcher Ahmed Kosba [48] present sev­eral exam­ples of what they call “crim­i­nal con­tracts.” They wrote them to work on the recently launched smart-contract plat­form Ethereum [49].

One exam­ple is a con­tract offer­ing a cryp­tocur­rency reward for hack­ing a par­tic­u­lar web­site. Ethereum’s pro­gram­ming lan­guage makes it pos­si­ble for the con­tract to con­trol the promised funds. It will release them only to some­one who pro­vides proof of hav­ing car­ried out the job, in the form of a cryp­to­graph­i­cally ver­i­fi­able string added to the defaced site.

Con­tracts with a sim­i­lar design could be used to com­mis­sion many kinds of crime, say the researchers. Most provoca­tively, they out­line a ver­sion designed to arrange the assas­si­na­tion of a pub­lic fig­ure. A per­son wish­ing to claim the bounty would have to send infor­ma­tion such as the time and place of the killing in advance. The con­tract would pay out after ver­i­fy­ing that those details had appeared in sev­eral trusted news sources, such as news wires. A sim­i­lar approach could be used for lesser phys­i­cal crimes, such as high-profile vandalism.

“It was a bit of a sur­prise to me that these types of crimes in the phys­i­cal world could be enabled by a dig­i­tal sys­tem,” says Juels. He and his coau­thors say they are try­ing to pub­li­cize the poten­tial for such activ­ity to get tech­nol­o­gists and pol­icy mak­ers think­ing about how to make sure the pos­i­tives of smart con­tracts out­weigh the negatives.

“We are opti­mistic about their ben­e­fi­cial appli­ca­tions, but crime is some­thing that is going to have to be dealt with in an effec­tive way if those ben­e­fits are to bear fruit,” says Shi.

Nico­las Christin [50], an assis­tant pro­fes­sor at Carnegie Mel­lon Uni­ver­sity who has stud­ied crim­i­nal uses of Bit­coin, agrees there is poten­tial for smart con­tracts to be embraced by the under­ground. “It will not be sur­pris­ing,” he says. “Fringe busi­nesses tend to be the first adopters of new tech­nolo­gies, because they don’t have any­thing to lose.”

Gavin Wood, chief tech­nol­ogy offi­cer at Ethereum, notes that legit­i­mate busi­nesses are already plan­ning to make use of his technology—for exam­ple, to pro­vide a dig­i­tally trans­fer­able proof of own­er­ship of gold [51].

How­ever, Wood acknowl­edges it is likely that Ethereum will be used in ways that break the law—and even says that is part of what makes the tech­nol­ogy inter­est­ingJust as file shar­ing found wide­spread unau­tho­rized use and forced changes in the enter­tain­ment and tech indus­tries, illicit activ­ity enabled by Ethereum could change the world, he says.

“The poten­tial for Ethereum to alter aspects of soci­ety is of sig­nif­i­cant mag­ni­tude,” says Wood. “This is some­thing that would pro­vide a tech­ni­cal basis for all sorts of social changes and I find that exciting.”

For exam­ple, Wood says that Ethereum’s soft­ware could be used to cre­ate a decen­tral­ized ver­sion of a ser­vice such as Uber, con­nect­ing peo­ple want­ing to go some­where with some­one will­ing to take them, and han­dling the pay­ments with­out the need for a com­pany in the mid­dle. Reg­u­la­tors like those har­ry­ing Uber in many places around the world would be left with noth­ing to tar­get. “You can imple­ment any Web ser­vice with­out there being a legal entity behind it,” he says. “The idea of mak­ing cer­tain things impos­si­ble to leg­is­late against is really interesting.”

 7. In FTR #795 [18], we noted that Narendra Modi was politically evolved from the Hindu nationalist/fascist milieu of the RSS. (An “alumnus” of that political environment murdered Gandhi.)

In addition, we have seen that Modi’s election was heavily buttressed [19] by Ebay’s Pierre Omidyar, who has underwritten Glenn Greenwald’s recent journalistic ventures and partially bankrolled [20] the 2014 Ukraine coup that brought the heirs of the OUN/B to power.

Modi is implementing the laissez-faire agenda favored by Omidyar, a cynical “corporatist” agenda that is poised to restore child labor in India.

The laissez-faire/corporatist agenda championed by Omidyar and Morsi is at one with the “austerity” doctrine promulgated by the GOP, Germany, the IMF and the Underground Reich.

“Get to work, kids! And be sure to bring your wages home to your [unemployed] mom and dad.”

“The Modi Gov­ern­ment Is Send­ing Mil­lions of Kids Back into Exploita­tive Labour”  [52]by Rashme Seh­gal; Quartz [52]; 5/4/2015. [52]

An amend­ment to the Child Labour Pro­hi­bi­tion Act pro­posed by the Naren­dra Modi-led gov­ern­ment is about to undo years of hard-won progress in the area of child labour—and con­demn mil­lions of kids to exploita­tive employment.

The amend­ment will allow chil­dren below the age of 14 to work in “fam­ily enter­prises”—a euphemism for indus­tries such as carpet-weaving, beedi–rolling, gem-polishing, lock-making and matchbox-making. The new norms will also apply to the enter­tain­ment indus­try and sports.

The amend­ment flies in the face of the Right to Edu­ca­tion Act (RTE), 2009, which guar­an­tees edu­ca­tion to every child. After the RTE came in, child labour dropped from 12.6 mil­lion in 2001 to 4.3 mil­lion in 2014. The amend­ment will undo much of that progress. It will also be a seri­ous set­back to all the work done by activists, such as Swami Agnivesh and Nobel lau­re­ate Kailash Sat­yarthi, to res­cue chil­dren from bonded labour and exploitation.

Mirzapur-based Shamshad Khan, pres­i­dent of the Cen­tre for Rural Edu­ca­tion and Devel­op­ment Action, calls the move “retrogressive.”

“All our cam­paigns to end bonded child labour, start­ing from the eight­ies, will go up in smoke,” Khan said. “Schools will be emp­tied out, and poor chil­dren in states like Bihar, Jhark­hand and Uttar Pradesh will be back to work­ing in sheds and makeshift fac­to­ries that will all go by the nomen­cla­ture of ‘fam­ily enter­prises.’ The worst-hit will be the chil­dren of Dal­its, Mus­lims, tribal fam­i­lies and those belong­ing to mar­gin­alised communities.”

The amend­ment can also be used to deny edu­ca­tion to the girl child, who will be sucked into all forms of house­work. Accord­ing to gov­ern­ment sta­tis­tics, male lit­er­acy lev­els in 2014 stood at about 82%, while female lit­er­acy lev­els were as low as 64%. The school drop-out rate for girls is almost dou­ble the rate for boys.

An uncon­sti­tu­tional change

Ban­daru Dat­ta­treya, India’s min­is­ter of labour and employ­ment, announced in early April that the gov­ern­ment planned to intro­duce amend­ments to the Child Labour Pro­hi­bi­tion Act in the cur­rent ses­sion of Parliament.

His min­istry, while seek­ing the amend­ments, said the Act will not apply to chil­dren help­ing fam­i­lies in home-based work, and espe­cially fam­i­lies work­ing in agri­cul­ture and animal-rearing. The objec­tive of these amend­ments, accord­ing to min­istry offi­cials, is to help chil­dren nur­ture a spirit of entre­pre­neur­ship. They will par­tic­u­larly help chil­dren of fam­i­lies cur­rently liv­ing at sub­sis­tence lev­els, the min­istry claims.

Child rights activists say the move will ben­e­fit fac­tory own­ers in India’s cow belt. Their prof­its will esca­late four­fold as chil­dren could be made to work longer hours and paid less than adults.

Enakshi Gan­guly Thukral of HAQ Cen­tre for Child Rights believes this is an attempt by the Modi gov­ern­ment to ensure a size­able chunk of the pop­u­la­tion remains in the infor­mal sec­tor, deprived of min­i­mum wages and social security.

“The gov­ern­ment is not in a posi­tion to pro­vide jobs for mil­lions of young peo­ple,” said Thukral. “Such a ret­ro­grade step will help ensure mil­lions of kids remain illit­er­ate and, there­fore, unemployable.”

Bad old days again

Major cut­backs in the 2015 bud­get in the areas of health, women and chil­dren, and edu­ca­tion will fur­ther com­pound this prob­lem. Thukral said labour offi­cials are already guilty of under-reporting child labour. “But once child labour is per­mit­ted under one guise or the other, then even a min­i­mum [level] of account­abil­ity will cease to exist,” she said.

Labour offi­cials at the dis­trict level are empow­ered to file cases against employ­ers hir­ing chil­dren but few employ­ers are ever con­victed. Sta­tis­tics from the labour min­istry for 2004–2014 show that there have been 1,168 con­vic­tions for chil­dren employed in haz­ardous indus­tries with about Rs83 lakh col­lected in fines. This money has been des­ig­nated for the reha­bil­i­ta­tion and wel­fare of child labour. How­ever, in this period, only Rs5 lakh was dis­bursed from this fund.

Khan recalls the period before the RTE Act, when dalals (touts) openly knocked on the doors of rich seths (mer­chants or busi­ness­men) to sell traf­ficked children.

“In the eight­ies, kids were being paid a daily wage of as lit­tle as Rs4 per day,” he said. “We kept up pres­sure on the gov­ern­ment, insist­ing that all out-of-school kids be cat­e­gorised as child labour. This open traf­fick­ing of kids declined sharply with the RTE Act. If the BJP (Bharatiya Janata Party) suc­ceeds in intro­duc­ing such a dan­ger­ous amend­ment, we will be back to those old days.” . . . .

8. In FTR #866 [21], we examined Silicon Valley’s extravagant, almost erotic celebration of Indian Prime Minister Narendra Modi, whose political career and BJP Party are inextricably linked with the RSS, a Hindu nationalist/fascist party.

Underscoring the hypocrisy of the “libertarians” who fawned over Modi and the moral, philosophical bankruptcy of their orientation, we note what Modi is actually dong in India. In Modi’s India, anyone taking issue with the Hindu nationalist/fascist dogma of the RSS, BJP and Modi himself faces potential lethal censorship.

We note that, just as political dissidents and civil libertarians are being murdered in India by the political forces empowered in party by EBay’s Pierre Omidyar, Ukraine is being beset by political murder as well. (Omidyar helped finance the Maidan coup in Ukraine, as well as the political ascent of Modi and his BJP.)

“India’s Attack on Free Speech” by Sonia Faleiro; The New York Times; 10/02/2015. [22]

In today’s India [53], secular liberals face a challenge: how to stay alive.

In August, 77-year-old scholar M. M. Kalburgi, an outspoken critic of Hindu idol worship, was gunned down [54] on his own doorstep. In February, the communist leader Govind Pansare was killed [55] near Mumbai. And in 2013, the activist Narendra Dabholkar was murdered [56] for campaigning against religious superstitions.

These killings should be seen as the canary in the coal mine: Secular voices are being censored and others will follow.

While there have always been episodic attacks on free speech in India, this time feels different. The harassment is front-page news, but the government refuses to acknowledge it. Indeed, Prime Minister Narendra Modi’s silence is being interpreted by many people as tacit approval, given that the attacks have gained momentum since he took office in 2014 and are linked to Hindutva groups whose far-right ideology he shares.

Earlier this month, a leader of the Sri Ram Sene, a Hindu extremist group with a history of violence including raiding pubs [57]and beating women they find inside, ratcheted up the tensions. He warned [58] that writers who insulted Hindu gods were in danger of having their tongues sliced off. For those who don’t support the ultimate goal of these extremists — a Hindu nation — Mr. Modi’s silence is ominous.

This is a turning point for India, a country that has taken pride in being a liberal democracy and that often adopts a high-minded tone when neighbors fall short of the same standards.

When the liberal Pakistani politician Salman Taseer was assassinated in 2011, the Indian journalist M. J. Akbar, now the national spokesman [59] for the Bharatiya Janata Party, or B.J.P., chided [60], “If Salman Taseer had been an Indian Muslim, he would still have been alive.” In the run-up to the 2014 general elections in Bangladesh, India expressed concern over the future of the country’s democratic institutions.

We should be worrying instead about what’s happening in India, and recognize that it could go the way of the very neighbors it criticizes. As Nikhil Wagle, a prominent liberal journalist based in Mumbai, told me, “Without secularism, India is a Hindu Pakistan.”

The murders in India share striking similarities with the killings of four Bangladeshi bloggers this year [61]. But while there was a global outcry over what happened in Bangladesh, India is hiding behind its patina of legitimacy granted by being the world’s largest democracy.

Like the murdered bloggers, the Indian victims held liberal views but were not famous or powerful. Mr. Kalburgi had publicly expressed skepticism toward idol worship in Hinduism, but he didn’t pose a threat to anyone.

While the authorities are pursuing the culprits on a case-by-case basis, the overarching attack on free speech has not been addressed. The threats and killings have created an atmosphere of self-censorship and fear.

Some of the killers are still on the loose, and while in one hand they wield a gun, in the other they wave a list. On Sept. 20, Mr. Wagle, the journalist, learned from a source that intercepted phone calls had revealed that members of yet another right-wing Hindu group, Sanatan Sanstha, had marked him as their next victim. The extremists who celebrated the August murder of Mr. Kalburgi were more direct: They used Twitter to warn K. S. Bhagwan, a retired university professor who is critical of the Hindu caste system, that he would be next.

The goal of transforming India from a secular state to a Hindu nation, which seems to be behind the murders, is abetted not just by the silence of politicians, but also by the Hindu nationalist policies of the ruling B.J.P.

Over the past few months, the government has purged secular voices [62] from high-profile institutions including the National Book Trust and the independent board of Nalanda University. The government is not replacing mediocre individuals: The chancellor of Nalanda was the Nobel laureate Amartya Sen. It is replacing luminaries with people whose greatest qualification is faith in Hindutva ideology. The new appointees are rejecting scientific thought in favor of religious ideas that have no place in secular institutions.

One of the government’s chief targets is the legacy of India’s first prime minister, Jawaharlal Nehru, who laid the foundation for a secular nation. Last month, having nudged out the director of the Nehru Museum and Library in New Delhi, the government announced plans to rename the museum and change its focus [63] to highlight the achievements of Mr. Modi. This is akin to repurposing the Washington Monument as an Obama museum.

In addition to erasing the contributions of long-dead liberals, B.J.P. leaders are busy promoting violent Hindu nationalists. Sakshi Maharaj, a B.J.P. member of Parliament, described [64] Nathuram Godse, the man who assassinated Mahatma Gandhi, as a “patriot.” Although Mr. Maharaj later retracted his statement, his opinion is shared by many of his party colleagues. Gandhi’s assassin was a former member of the Rashtriya Swayamsevak Sangh, an armed Hindu group, with which Mr. Modi has been associated since he was 8 years old.

THE B.J.P.’s efforts to reshape institutions that embody secular values — values they dismiss as “Western” — was certainly anticipated. It came as no surprise when the culture and tourism minister, Mahesh Sharma, recently promised [65] to “cleanse every area of public discourse that had been westernized.” Mr. Sharma is well aware of the connotations of the word he used.

It’s also not surprising that Hindu fundamentalists would feel empowered in the shadow of a Hindu nationalist government. Still, few expected that freedom of speech would become a contestable commodity and that some who exercised it would lose their lives.

The realization has made for decisions that were once unthinkable.

Last December, the acclaimed author Perumal Murugan informed the police that he’d received threats from Hindu groups angered by a novel he wrote in 2010. Extremists staged burnings of his book and demanded a public apology from him. The police suggested he go into exile. Realizing he was on his own, in January Mr. Murugan announced the withdrawal [66] of his entire literary canon. On Facebook, he swore [67] to give up writing, in essence apologizing for his life’s work out of fear for his family’s safety.

It’s hard to accept what is happening in India. It is easier to ignore or dismiss the attacks and the threats as a liberal persecution complex or a phase that will last only as long as the B.J.P. is in power. But the country is undergoing a tectonic shift that will have long-term repercussions.

The attacks in India should not be seen as a problem limited to secular writers or liberal thinkers. They should be recognized as an attack on the heart of what constitutes a democracy — and that concerns everyone who values the idea of India as it was conceived and as it is beloved, rather than an India imagined through the eyes of religious zealots. Indians must protest these attacks and demand accountability from people in power. We must call for all voices to be protected, before we lose our own.

9. Further evidence of the nature of Modi’s governance:

“India Politics Are Backdrop In Mob Attack” by David Barstow and Suhasini Raj; The New York Times; 10/05/2015; p. A4. [24]

The vigilantes from Save the Cow sprang into action the moment they heard a rumor that a cow’s slaughtered remains [68] had been found near an electrical transformer looming over the heart of this village. They quickly raised the alarm through text messages and phone calls. A local Hindu priest was asked to alert villagers from his temple loudspeaker.

Soon, about 1,000 men had gathered by the transformer. There was no sign that a cow, a holy symbol for Hindus, had been slaughtered. Nonetheless, the men proceeded through zigzagging alleys to the home of the suspected cow killer, Mohammed Ikhlaq, one of the few Muslims living in this village about 30 miles east of New Delhi.

Mr. Ikhlaq and his wife, Ikraman, were on their second-floor patio, dozing after dinner and prayers. Suddenly their home was swarming with men. Mrs. Ikhlaq heard someone shout, “Kill them.” She, her husband and their son Danish, 20, retreated inside, behind a thick wooden door. The mob shattered the door.

“What’s the matter?” Mrs. Ikhlaq cried out. An incredulous voice replied from the dark, “After slaughtering a cow, you are asking us what’s the matter?”

Men began to paw at Mrs. Ikhlaq, so she bit hard into a sweaty hand, broke free and fled downstairs, “too scared to even breathe,” she said in an interview. Upstairs, the mob bludgeoned her husband with her sewing machine and smashed her son’s head with a brick. Then they dragged Mr. Ikhlaq down 14 cement steps and out to the main road by the transformer, where he was left for all to see.

Mr. Ikhlaq was declared dead early Tuesday morning, hours after the attack; his son remains in critical condition. But in interviews last week, more than a half-dozen members of Save the Cow expressed little remorse for what happened at the Ikhlaqs’ home. Instead, they blamed Mr. Ikhlaq for inciting the mob’s fury by slaughtering and eating a cow — an allegation dismissed by the Ikhlaq family and the police, who have filed murder charges against 10 men. . . . .

. . . . Many leaders of Save the Cow here are also prominent local organizers in Prime Minister Narendra Modi [69]’s Hindu nationalist Bharatiya Janata Party, or B.J.P., which is vying to oust the socialist party that leads Uttar Pradesh, a vast northern state with more than 200 million residents, including the 20,000 in this village. Mr. Tomar, 24, for example, is the general secretary of the local B.J.P. youth wing. Mr. Nagar, 33, is the state secretary of the B.J.P. youth wing.

By week’s end, they and many other B.J.P. leaders were blaming the governing party in Uttar Pradesh for the attack in Bisada. . . .

. . . . Save the Cow and B.J.P. leaders here have also roundly condemned the decision by the police to bring murder charges. In their view, the death of Mr. Ikhlaq was at most the unintended byproduct of a chaotic, highly charged situation of his own making. “He slipped and his head hit the road and he died,” Mr. Tomar said, adding: “These things happen. It’s a mob.”

Mr. Modi’s culture minister, Mahesh Sharma, who represents this area in the Indian Parliament, went so far as to tell The Indian Express that Mr. Ikhlaq’s death “should be considered as an accident.”