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Update on Eddie the Friendly Spook’s Economic Warfare against the U.S.

Dave Emory’s entire life­time of work is avail­able on a flash dri­ve that can be obtained here. [1] (The flash dri­ve includes the anti-fas­cist books avail­able on this site.)

[2]COMMENT: In a pre­vi­ous post, we updat­ed [3] The Adven­tures of Eddie the Friend­ly Spook. In that post we took note of an Atlantic [4] arti­cle which high­lights a joint Brazilian/EU effort to build a Transat­lantic fiber-optic cable to thwart U.S. sur­veil­lance, as well as Merkel’s plans to cre­ate a data-secure EU inter­net struc­ture. All of this sup­pos­ed­ly in response to Snow­den’s “dis­clo­sures.” As we have not­ed in the past, this is sheer non­sense. Ger­many, EU coun­tries and oth­er major intel­li­gence ser­vices do the same thing. Ger­many, Brazil and the EU have known of the NSA’s activ­i­ties for years. Ger­many has been a long-stand­ing part­ner with NSA.

Snowden–whom we think is being direct­ed by BND (as well as by an ele­ment of CIA)–engaged in his “op” in order to jus­ti­fy a pre-arranged eco­nom­ic offen­sive against the Amer­i­can IT sec­tor [5]The arti­cle also notes that the inven­tion of the Inter­net was a huge boon to the U.S. econ­o­my. As we not­ed in our series on Eddie the Friend­ly Spook, the Snow­den “op” is an act of eco­nom­ic and polit­i­cal war­fare [6] against the Unit­ed States.

Now, we note an arti­cle that chron­i­cles seri­ous dam­age to the U.S. high-tech econ­o­my as a result of Snow­den’s “op.”

We told you so!

“New Report Snows Edward Snow­den’s Rev­e­la­tions Are Seri­ous­ly Dam­ag­ing U.S. Tech Firms” by Eugene Kim; Busi­ness Insid­er; 7/30/014. [7]

 The non­prof­it New Amer­i­ca Foun­da­tion released a new report this week that sum­ma­rizes the impact of Edward Snowden’s NSA rev­e­la­tion on U.S. tech firms.
With­in weeks of the first NSA rev­e­la­tion last year, com­pa­nies like Drop­box and Ama­zon Web Ser­vices report­ed imme­di­ate drops in their sales, the report said. Cit­ing a pre­vi­ous report, it said the NSA’s PRISM pro­gram could cost cloud-com­put­ing com­pa­nies from $22 bil­lion to $180 bil­lion over the next there years.

“This ero­sion in trust threat­ens to do the most imme­di­ate dam­age to the cloud com­put­ing indus­try, which would lose bil­lions of dol­lars in the next three to five years as a result,” it said.

In par­tic­u­lar, U.S. tech firms are being severe­ly hit in over­seas mar­kets, the report said. Com­pa­nies such as Cis­co, Qual­comm, IBM, Microsoft, and HP have all report­ed declines in sales in Chi­na fol­low­ing the NSA rev­e­la­tions. In fact, accord­ing to The Wall Street Jour­nal, Cis­co said it’s expect­ing rough­ly a 10% loss in quar­ter­ly rev­enue because of the “Snow­den effect.” A web-host­ing com­pa­ny called Servint report­ed­ly lost more than half of its over­seas clients fol­low­ing the rev­e­la­tion.

Amer­i­can firms are also los­ing the trust of for­eign gov­ern­ments because of this. The Ger­man gov­ern­ment said it would end its con­tract with Ver­i­zon last month, while Brazil picked Swedish firm Saab over Boe­ing for a deal to replace its fight­er jets, accord­ing to the report. It said more and more for­eign com­peti­tors are ben­e­fit­ing from the per­ceived image of being “NSA-proof” or “safer” than U.S. firms.

As a result, coun­tries like Ger­many, Brazil, and India are close to enact­ing a new law that would require com­pa­nies to use local data cen­ters. For exam­ple, Ger­man Chan­cel­lor Angela Merkel, after refus­ing to vis­it the U.S. for months after the NSA dis­clo­sures, has called for data local­iza­tion laws. Brazil and India are propos­ing IT com­pa­nies to either set up or keep their data cen­ters with­in local bound­aries, while Greece, Brunei, and Viet­nam are fol­low­ing suit with sim­i­lar mea­sures, the report said.

All of this could slow the growth of the U.S. tech indus­try by as much as 4% and seri­ous­ly under­mine America’s cred­i­bil­i­ty around the world, the report con­clud­ed.