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FTR #866 Because They Can, Part 2: More about Technocratic Fascism

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].  

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

Intro­duc­tion: Some folks just don’t play well with oth­ers. Sad­ly, ter­ri­fy­ing­ly and trag­i­cal­ly, that applies to many key play­ers in the world of Big Tech.

Sup­ple­ment­ing dis­cus­sion pre­sent­ed in FTR #859 [7], we reit­er­ate the intro­duc­tion to that broad­cast.

Albert Ein­stein said of the inven­tion of the atom­ic bomb: “Every­thing has changed but our way of think­ing.” We feel that oth­er, more recent devel­op­ments in the world of Big Tech war­rant the same type of warn­ing.

This pro­gram fur­ther explores the Brave New World being mid­wived by tech­nocrats. These stun­ning devel­op­ments should be viewed against the back­ground of what we call “tech­no­crat­ic fas­cism,” ref­er­enc­ing a vital­ly impor­tant arti­cle by David Golum­bia. [8] ” . . . . 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 [9] 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 [10] 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 [11]). 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. . . .

Under­scor­ing the “anar­cho-fas­cist” nature of tech­no­crat­ic fas­cism, the broad­cast notes how cryp­to-cur­ren­cies offer the pos­si­bil­i­ty of, what for lack of a bet­ter term, might be called “cyber-off­shoring.” [12] Going the Cay­man Islands and oth­er off­shore tax havens one bet­ter, cryp­to-cur­ren­cy offers the pos­si­bil­i­ty of socio­path­ic eco­nom­ic elites col­laps­ing the nation state by sub­vert­ing rev­enue col­lec­tion. This is the fis­cal wet dream of the eco­nom­ic elites that dom­i­nate right-wing ide­ol­o­gy. “No Tax­es!”

” . . . 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. . . .”

Con­tin­u­ing to explore the tech­no­log­i­cal aspect of cor­po­ratist ide­ol­o­gy, we note that Tar­get stores respond­ed to a vote by their phar­ma­cists to union­ize by intro­duc­ing a new com­mit­ment to robot work­ers. (This is rem­i­nis­cent of a threat to replace fast-food work­ers [13] with “apps,” if they try to obtain a high­er min­i­mum wage.)

Next, we recap an impor­tant arti­cle high­light­ed in FTR #851 [14].  A Bit­coin-inspired tech­nol­o­gy [15] devel­oped by Ethereum appears set to engen­der a num­ber of appalling pos­si­bil­i­ties, includ­ing: the anony­mous, online fund­ing of the assas­si­na­tion of pub­lic offi­cials; the anony­mous sab­o­tag­ing and van­dal­iz­ing of web­sites and last, but cer­tain­ly not least, the replace­ment of third-par­ty human admin­is­tra­tors, such as lawyers with code. It won’t just be fast-food work­ers and low-wage employ­ees at places like Tar­get who lose their jobs to high-tech automa­tion!

The socio­path­ic eth­ic fun­da­men­tal to tech­no­crat­ic fas­cism was artic­u­lat­ed by Ethereum Chief Tech­nol­o­gy Offi­cer Gavin Wood:

” . . . . 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.” . . . .

. . . . “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.”

In that same con­text, major finan­cial insti­tu­tions impli­cat­ed in the shenani­gans that brought about the finan­cial col­lapse of 2008, as well as the Libor rig­ging scan­dal have launched the Sym­pho­ny mes­sag­ing sys­tem [16], which may prove opaque to reg­u­la­tors.

State-of-the-art facial recog­ni­tion soft­ware [17] deployed by the wild­ly pop­u­lar Face­book threat­ens pri­va­cy in unprece­dent­ed ways. Peo­ple should be far more wor­ried about Facebook–with 1.5 bil­lion users–than of the NSA. QUICK: How much influ­ence do YOU have in what Face­book does?!

The pro­gram con­cludes with a look at Indi­an Pre­mier Naren­dra Mod­i’s court­ing [18] of Sil­i­con Val­ley com­pa­nies, includ­ing Zucker­berg’s Face­book.

His polit­i­cal CV is inex­tri­ca­bly linked with the oper­a­tions, devel­op­ment and his­to­ry of the RSS, polit­i­cal par­ent [14] to his BJP Par­ty. The RSS is a Hin­du nation­al­ist and fas­cist par­ty, one of whose alum­ni assas­si­nat­ed [19] Mahat­ma Gand­hi.

Recent devel­op­ments have clar­i­fied the degree of con­trol and influ­ence that the RSS exerts on Modi. That con­trol is pro­found and direct [20].

Pro­gram High­lights Include: 

1a. We by re-exam­in­ing one of the most impor­tant ana­lyt­i­cal arti­cles in a long time, David Golumbi­a’s arti­cle in Uncomputing.org about tech­nocrats and their fun­da­men­tal­ly unde­mo­c­ra­t­ic out­look.

This con­cept is key to under­stand­ing much of what we will dis­cuss.

“Tor, Tech­noc­racy, Democ­ra­cy” [8]by David Golum­bia; Uncomputing.org [8]; 4/23/2015. [8]

” . . . . 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 leviathan. Hack­ers (“civic,” “eth­i­cal,” “white” and “black” hat alike), hack­tivists, Wik­iLeaks fans [and Julian Assange et al–D. E.], Anony­mous “mem­bers,” even Edward Snow­den him­self [9] 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 poli­ties. Where the UN’s Uni­ver­sal Dec­la­ra­tion on Human Rights [10] 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 [11]). 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. . . .”

1b. 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 [22]764 [23]770 [24]785 [25].)

“Cryp­tocur­ren­cy Tax­a­tion May Sub­vert Nation­al Col­lec­tion” by Travis Patron; Dig­i­nomics; 9/06/2015. [12]

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 [26], 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 [27], 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 [28] (FATCA). In his report Are Cryp­tocur­ren­cies Super Tax Havens? [29], 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 [30] 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 [31], 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 num­ber. Tru­ly, 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

Con­clu­sion

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 [32]. 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.

3a. A har­bin­ger of things to come: if you want to union­ize, you may be replaced by tech­nol­o­gy.

“Day After Employ­ees Vote to Union­ize, Tar­get Announces Fleet of Robot Work­ers” by James Woods; U.S. Uncut; 9/23/2015. [33]

Just a day after phar­ma­cy work­ers from a Brook­lyn Tar­get store formed a union, the com­pa­ny announced plans to replace employ­ees with robot work­ers in the near future.

Last week it was report­ed that the phar­ma­cists had sub­mit­ted their ini­tial “microunion” fil­ing with the Nation­al Labor Rela­tions Board after an ini­tial bal­lot vote was passed 7 ‑2. The fil­ing was note­wor­thy as the work­ers become the first union at any Tar­get store since the retail­er opened in 1902.

Yet, less than a week lat­er, in a seem­ing­ly unre­lat­ed press release, Casey Carl, the Chief Tech­nol­o­gy and Strat­e­gy Offi­cer at Tar­get announced the company’s plan to devel­op automa­tion sys­tems and replace work­ers with robots in their retail loca­tions as part of a new pro­gram with Tech­stars, an indus­try leader with a rep­u­ta­tion for accel­er­at­ing star­tups.

“We know that tech­nol­o­gy will con­tin­ue to rev­o­lu­tion­ize retail, and that Target’s future will be built on inno­va­tion. That’s why we’re so excit­ed to part­ner with Tech­stars and invite the world’s most promis­ing star­tups to work with Tar­get right in our back­yard.”

For the last few years, Tar­get has been increas­ing their share of the e‑commerce sec­tor since tak­ing back con­trol of their dig­i­tal ful­fill­ment from Ama­zon, which also uses robot work­ers. But now, they are look­ing to inte­grate that por­tion of their busi­ness with their brick and mor­tar loca­tions to cre­ate a speedy gro­cery deliv­ery ser­vice, which will require an even greater invest­ment in tech­nol­o­gy.

That, com­bined with groups and politi­cians work­ing towards a $15 per hour min­i­mum wage, has pushed Tar­get to announce that with­in two years they will have a “con­cept store” open that will include robots instead of asso­ciates.

Large cor­po­ra­tions such as McDonald’s and Wal-Mart have been using the threat of “auto­mat­ed work­ers” for years to keep wages low and sup­press union growth with­in their stores, but have so far been unsuc­cess­ful in automat­ing the “cus­tomer ser­vice” por­tion of their oper­a­tions.

3b. 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 [22]764 [23]770 [24]785 [25].

“Bitcoin’s Dark Side Could Get Dark­er” [15]by Tom Simonite; MIT Tech­nol­ogy Review; 8/13/2015. [15]

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 [34]”). Ari Juels [35], 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 [36], Juels, fel­low Cor­nell pro­fes­sor Elaine Shi [37], and Uni­ver­sity of Mary­land researcher Ahmed Kos­ba [38] present sev­eral exam­ples of what they call “crim­i­nal con­tracts.” They wrote them to work on the recent­ly launched smart-con­tract plat­form Ethereum [39].

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 [40], 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 [41].

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 inter­est­ing. Just 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.”

4. Sym­phony, Wall Street’s fan­cy new bank-to-bank mes­sag­ing sys­tem that sports super-encryp­tion even the gov­ern­ment can’t break, just went live. And they did so only after com­ing to an agree­ment with the New York Depart­ment of Finan­cial Ser­vices over con­cerns that Symphony’s clients were going to be hid­ing incrim­i­nat­ing evi­dence from reg­u­la­tors: Sym­phony agrees to keep copies of client mes­sages for sev­en years. Addi­tion­ally, for four banks — Gold­man Sachs, Deutsche Bank, Cred­it Suisse and Bank of New York Mel­lon — that are both investors in Sym­phony and, in most cas­es, per­pe­tra­tors of the giant Libor-rig­ging car­tel arranged via a chat sys­tem [42], they also have to give copies of their encryp­tion keys to an inde­pen­dent cus­to­di­an.

So with those safe­guards in place, Wall Street’s con­trolled infor­ma­tion black hole is now a real­ity [16]:

“Mes­sag­ing Ser­vice Sym­phony Dodges Reg­u­la­tory Action Ahead of Launch” by Arik Hes­sel­dahl; Re/Code; 9/14/2015. [16]

Sym­phony, the secure mes­sag­ing com­pany backed by 15 Wall Street banks, will launch on Tues­day after ham­mer­ing out a deal with a reg­u­la­tory agency that once threat­ened to shut down the first real chal­lenge to the Bloomberg Ter­mi­nal.

Three years in the mak­ing, Sym­phony was born out of des­per­a­tion among the world’s most pow­er­ful finan­cial firms and invest­ment hous­es to break free of Bloomberg’s [43]stran­gle­hold on finan­cial soft­ware, data and news. Long before peo­ple used Face­book, MySpace, Twit­ter or AOL Instant Mes­sen­ger, finan­cial pro­fes­sion­als depend­ed on the ter­mi­nal to chat with and keep track of one anoth­er. Today, the ter­mi­nal con­fers sta­tus and priv­i­lege to the more than 325,000 finan­cial pros who pay $24,000 a year to use it.

Symphony’s cloud-based mes­sag­ing ser­vice does two things: It uses advanced encryp­tion tech­niques in order to keep sen­si­tive mes­sages — instant mes­sages most­ly — locked up and out of the hands of hack­ers. But since it’s designed for finan­cial com­pa­nies, which are required by law to keep copies of their mes­sages for sev­eral years in case reg­u­la­tors or law enforce­ment ever needs them for an inves­ti­ga­tion, it has also been designed to work in con­cert with what­ever com­pli­ance tools those com­pa­nies have in place.

So when the New York Depart­ment of Finan­cial Ser­vices raised sus­pi­cions over the sum­mer that banks might use Symphony’s encryp­tion tech­nol­ogy to avoid the pry­ing eyes of reg­u­la­tors, it seemed plau­si­ble that the com­pany could face restric­tions on how it does busi­ness.

That didn’t hap­pen. Instead, on Mon­day Sym­phony announced a deal [44] with the DFS under which it agreed to store for sev­en years copies of mes­sages that its clients send on the ser­vice. Addi­tion­ally, four banks (Gold­man Sachs, Deutsche Bank, Cred­it Suisse and Bank of New York Mel­lon) which are both cus­tomers of and investors in Sym­phony agreed to turn over copies of their encryp­tion keys to an inde­pen­dent cus­to­dian. When a reg­u­la­tor wants to review encrypt­ed mes­sages, they will be able to decrypt them upon request.

“The agree­ment is anoth­er pos­i­tive devel­op­ment on the eve of Symphony’s launch,” the com­pany said in a state­ment emailed to Re/code. “Symphony’s plat­form safe­guards against cyber-threats while strength­en­ing cus­tomers’ com­pli­ance oper­a­tions and facil­i­tat­ing their abil­ity to meet their reg­u­la­tory oblig­a­tions. Sym­phony can store data secure­ly for as long as its cus­tomers request, and its end-to-end encryp­tion ensures mes­sages are secure. Sym­phony pro­vides state-of-the-art cyber-secu­ri­ty for insti­tu­tions oper­at­ing in com­plex reg­u­la­tory envi­ron­ments.”

It’s not entire­ly the end of the reg­u­la­tory road for Sym­phony: Over the sum­mer Sen. Eliz­a­beth War­ren wrote a let­ter to fed­eral reg­u­la­tors express­ing wor­ries sim­i­lar to those of DFS, and there are ques­tions pend­ing too from inter­na­tional reg­u­la­tory bod­ies. But none of them are espe­cially wor­ry­ing to CEO David Gurle.

“We’ve engaged in a series of meet­ings with reg­u­la­tors where we demon­strate that we have capa­bil­i­ties that can be used by reg­u­la­tors to car­ry out any kind of inves­ti­ga­tion they may want to do,” he told Re/code in an inter­view ear­lier this month. “What we do enhances the abil­ity of our clients to meet their legal and reg­u­la­tory oblig­a­tions, but it also gives them the added ben­e­fit of secure com­mu­ni­ca­tions.”

...

It’s not entire­ly the end of the reg­u­la­tory road for Sym­phony: Over the sum­mer Sen. Eliz­a­beth War­ren wrote a let­ter to fed­eral reg­u­la­tors express­ing wor­ries sim­i­lar to those of DFS, and there are ques­tions pend­ing too from inter­na­tional reg­u­la­tory bod­ies. But none of them are espe­cially wor­ry­ing to CEO David Gurle.
...

5. Face­book’s facial recog­ni­tion soft­ware con­tin­ues to be a source of con­tro­ver­sy and lit­i­ga­tion. Bear in mind that Face­book is also devel­op­ing apps that per­mit peo­ple’s smart phones to be turned on remote­ly [45], in order to mon­i­tor the type of music they (and their friends and asso­ciates) enjoy. They are also imple­ment­ing an app that will per­mit finan­cial insti­tu­tions to deny peo­ple cred­it [46] on the basis of the cred­it-wor­thi­ness of their friends and asso­ciates!

“Face­book Keeps Get­ting Sued Over Face-Recog­ni­tion Soft­ware, And Pri­vacy Groups Say We Should Be Pay­ing More Atten­tion” by Christo­pher Zara; Inter­na­tional Busi­ness Times; 9/3/2015. [17]

Who owns your face? Believe it or not, the answer depends on which state you live in, and chances are, you live in one that hasn’t even weighed in yet.

That could soon change. For the fourth time this year, Face­book Inc. was hit with a class-action law­suit by an Illi­nois res­i­dent who says its face-recog­ni­tion soft­ware vio­lates an unusu­al state pri­vacy law there. The lat­est com­plaint [47], filed Mon­day, under­scores a qui­et but high-stakes legal bat­tle for the social net­work­ing giant, one that could rever­ber­ate through­out the rest of the U.S. tech indus­try and much of the pri­vate sec­tor.

With almost 1.5 bil­lion active users [48], Face­book has amassed what prob­a­bly is the world’s largest pri­vate data­base of “faceprints,” dig­i­tal scans that con­tain the unique geo­met­ric pat­terns of its users’ faces. The com­pany says it uses these iden­ti­fiers to auto­mat­i­cally sug­gest pho­to tags. When users upload new pic­tures to the site, an algo­rithm cal­cu­lates a numer­ic val­ue based on a person’s unique facial fea­tures. Face­book pitch­es the fea­ture as just anoth­er con­ve­nient way to stay con­nected with friends, but pri­vacy and civ­il rights advo­cates say the data gen­er­ated by face-recog­ni­tion tech­nol­ogy is unique­ly sen­si­tive, and requires extra spe­cial safe­guards as it finds its way into the hands of pri­vate com­pa­nies.

“You can’t turn off your face,” said Alvaro M. Bedoya, found­ing exec­u­tive direc­tor of George­town University’s Cen­ter on Pri­vacy & Tech­nol­ogy. “Yes, it’s 2015, and yes, we’re tracked in a mil­lion dif­fer­ent ways, but for most of those forms of track­ing, I can still turn it off if I want to.”

Faceprints Are Most­ly Unreg­u­lat­ed

Cur­rently, there are no com­pre­hen­sive fed­eral reg­u­la­tions gov­ern­ing the com­mer­cial use of bio­met­rics, the cat­e­gory of infor­ma­tion tech­nol­ogy that includes faceprints. And Bedoya said the gov­ern­ment appears to be in no hur­ry to address the issue.

Ear­lier this year, the Cen­ter on Pri­vacy & Tech­nol­ogy was one of a num­ber of pri­va­cy-rights groups — along with the Elec­tronic Fron­tier Foun­da­tion and the Amer­i­can Civ­il Lib­er­ties Union, among oth­ers — that with­drew from dis­cus­sions on how to craft guide­lines for face-recog­ni­tion tech­nol­ogy. After months of nego­ti­a­tions, Bedoya said the groups grew frus­trated by tech indus­try trade asso­ci­a­tions that would not agree to even the most min­i­mal of pro­tec­tions, includ­ing a rule that would require com­pa­nies to obtain writ­ten con­sent before col­lect­ing and stor­ing faceprints on con­sumers.

“When not a sin­gle trade asso­ci­a­tion would agree to that, we just real­ized we weren’t deal­ing with peo­ple who were there to nego­ti­ate,” Bedoya said. “We were there to deal basi­cally with peo­ple who want­ed to stop the process, or make it some­thing that was watered down.”

But Illi­nois is dif­fer­ent. It’s one of only two states — the oth­er being Texas — to reg­u­late bio­met­rics in the pri­vate sec­tor. Illi­nois passed its Bio­met­ric Infor­ma­tion Pri­vacy Act [49]in 2008, back when Face­book was still in its rel­a­tive infan­cy and most com­pa­nies were not think­ing about face-recog­ni­tion tech­nol­o­gy.

“I think we were ahead of the curve,” said Mary Dixon, leg­isla­tive direc­tor for the ACLU of Illi­nois, which advanced the ini­tia­tive. “I think it’d be hard to pass sim­i­lar ini­tia­tives now giv­en the intense lob­by against some of the pro­tec­tions we were able to advance.”

Lit­i­ga­tion Face­off

Illi­nois’ law went pret­ty much unno­ticed until April of this year, when a high-pro­file pri­vacy lawyer filed a law­suit in fed­eral court on behalf of a Face­book user who charges that Face­book is col­lect­ing and stor­ing faceprints on its users with­out obtain­ing informed writ­ten con­sent, a vio­la­tion of Illi­nois’ BIPA. The suit is fed­eral because Face­book is based in Cal­i­for­nia and the pro­posed plain­tiff class poten­tially num­bers in the mil­lions. Since then, at least three more fed­eral law­suits [50]were filed, each mak­ing sim­i­lar claims. The lat­est suit comes from Fred­er­ick William Gullen, an Illi­nois res­i­dent who doesn’t even have a Face­book account, but who insists that Face­book cre­ated a tem­plate of his face when anoth­er user uploaded a pho­to of him.

“Face­book is active­ly col­lect­ing, stor­ing, and using — with­out pro­vid­ing notice, obtain­ing informed writ­ten con­sent or pub­lish­ing data reten­tion poli­cies — the bio­met­rics of its users and unwit­ting non-users ... Specif­i­cally, Face­book has cre­ated, col­lected and stored over a bil­lion ‘face tem­plates’ (or ‘face prints’) — high­ly detailed geo­met­ric maps of the face — from over a bil­lion indi­vid­u­als, mil­lions of whom reside in the State of Illi­nois.”

A Face­book spokes­woman said the law­suits are with­out mer­it and the com­pany will defend itself vig­or­ously against them, but the real­ity is, the cas­es could play out in a num­ber of ways giv­en that face recog­ni­tion is large­ly untest­ed legal ter­ri­to­ry.

Dixon and oth­er legal experts famil­iar with BIPA say Face­book prob­a­bly will argue that because its faceprints are derived from pho­tographs, they are exempt from BIPA’s con­sent require­ments. Shut­ter­fly Inc., anoth­er Inter­net com­pany being sued in Illi­nois over facial-recog­ni­tion tech­nol­ogy, is argu­ing a sim­i­lar stance [51]. Although BIPA clear­ly con­sid­ers scans of “hand or face geom­e­try” to be bio­met­ric iden­ti­fiers, it also says pho­tographs are not. Bedoya said the word­ing of the law rais­es a “seem­ing con­tra­dic­tion” that defen­dants fight­ing BIPA law­suits might be able to exploit.

“The law was writ­ten in a way that could have been clear­er,” he said.

Face­book points out that users can turn off tag sug­ges­tions, but Dixon said BIPA was writ­ten to ensure that bio­met­ric data col­lec­tion does not take place with­out writ­ten con­sent exe­cuted by the sub­ject of the bio­met­ric iden­ti­fier. The law also makes it ille­gal to sell, lease or oth­er­wise prof­it from a customer’s bio­met­ric infor­ma­tion, a par­tic­u­lar thorn in the side for com­pa­nies that trade in per­sonal data.

The Face­book and Shut­ter­fly law­suits will be close­ly watched as pol­i­cy­mak­ers in oth­er states con­sider craft­ing bills gov­ern­ing the use of bio­met­rics. Mean­while, pri­vacy advo­cates say we should all be pay­ing atten­tion. As face-recog­ni­tion tech­nol­ogy becomes more per­va­sive, it will have increas­ing impli­ca­tions for our lives, both online and off.

“There’s an awful lot at stake here,” Bedoya said. “In the end, do we want to live in a soci­ety where every­one is iden­ti­fied all the time the minute they walk out into pub­lic? I think most peo­ple aren’t ready for that world.”

6. Epit­o­miz­ing the amoral per­spec­tive lurk­ing behind the very suc­cess­ful pub­lic rela­tions man­i­fest­ed by Big Tech is their court­ing of Naren­dra Modi.

“Naren­dra Modi, Indi­an Pre­mier, Courts Sil­i­con Val­ley to Try and Ease Nation’s Pover­ty” by Vin­du Goel; The New York Times; 9/27/2015. [18]

Naren­dra Modi [52] and Mark Zucker­berg [53] have much in com­mon.

Mr. Modi, the prime min­is­ter of India, over­sees a nation of 1.25 bil­lion peo­ple. Mr. Zucker­berg, the chief exec­u­tive of Face­book [54], runs a social net­work with 1.5 bil­lion active users. Both see them­selves as glob­al lead­ers push­ing for broad social change, and both rou­tine­ly use social media to com­mu­ni­cate with their many mil­lions of fans.

On Sun­day, the two men engaged in a mutu­al admi­ra­tion ses­sion at Face­book [54]’s Sil­i­con Val­ley head­quar­ters, with Mr. Modi field­ing pre­s­e­lect­ed ques­tions from a crowd of Face­book employ­ees and guests invit­ed by the Indi­an Embassy.

Mr. Modi praised social net­works like Face­book, Twit­ter [55] and even China’s Wei­bo as use­ful tools for gov­ern­ing and diplo­ma­cy. . . .

. . . . Sil­i­con Val­ley has been eager to assist. . . . .

[56]7. In FTR #795 [57], we detailed the his­tor­i­cal evo­lu­tion of the polit­i­cal ascent of Naren­dra Modi. His polit­i­cal CV is inex­tri­ca­bly linked with the oper­a­tions, devel­op­ment and his­to­ry of the RSS, polit­i­cal par­ent [14] to his BJP Par­ty. The RSS is a Hin­du nation­al­ist and fas­cist par­ty, one of whose alum­ni assas­si­nat­ed [19] Mahat­ma Gand­hi.

Recent devel­op­ments have clar­i­fied the degree of con­trol and influ­ence that the RSS exerts on Modi. That con­trol is pro­found and direct.

We also note that Mod­i’s elec­tion was engi­neered to a con­sid­er­able extent by Pierre Omid­yar, the top dog at EBay. Omid­yar also helped bankroll the Maid­an coup [58], that placed the heirs to the OUN/B, Third Reich-allied fas­cists in pow­er. We should nev­er for­get that it is Omid­yar who has bankrolled Cit­i­zen Green­wald’s jour­nal­is­tic ven­tures.

[59]Modi says he wants to court Big Tech to raise his coun­try out of pover­ty. As we not­ed in FTR #851 [14], he is also try­ing to do that by relax­ing his coun­try’s child labor laws! [21]

“Modi Blows His Cov­er – and the Loss is India’s” [20]by M.K. Bhadraku­mar; Asia Times [20]; 9/10/2015. [20]

India recent­ly wit­nessed a strange spec­ta­cle of Prime Min­is­ter Naren­dra Modi and his cab­i­net col­leagues sub­ject­ing them­selves to an intense scruti­ny by the Rashtriya Swayam­se­vak Sangh or RSS, the Hin­du nation­al­ist orga­ni­za­tion, regard­ing their ‘per­for­mance’ in office.

Modi him­self used to be an activist of the RSS. But an elab­o­rate cha­rade was kept so far that Modi was in com­mand of the gov­ern­ment.

The Indi­an media has since report­ed that the RSS even­tu­ally gave ‘thumbs up’ to the gov­ern­ment after Modi and his cab­i­net col­leagues trooped in to meet the RSS boss­es and tes­ti­fied at the hear­ing on their ‘schemes and achieve­ments’ in the gov­ern­ment.

No Indi­an gov­ern­ment has ever been made to look so fool­ish and dif­fi­dent.

Why the RSS decid­ed to sub­ject Modi and his cab­i­net to such a dress­ing down pub­licly is anybody’s guess. Per­haps, it was to project the RSS itself as god almighty in the Modi era. But then, it is an open secret that the Hin­du fun­da­men­tal­ist groups are call­ing the shots in the gov­ern­ment, pen­e­trat­ing all walks of nation­al life sys­tem­at­i­cally and impos­ing their agen­da.

The upshot of the RSS hear­ing is that Modi has blown his ‘cov­er’, which helped him so far as prime min­is­ter to cre­ate an impres­sion that he is a human­ist and a devout fol­lower of Bud­dhism who viewed with dis­taste the excess­es com­mit­ted by the Hin­du zealots on the minor­ity com­mu­ni­ties in India such as the attacks on Chris­t­ian church­es.

Under the Modi gov­ern­ment, inci­dents of com­mu­nal ten­sion involv­ing Hin­dus and Mus­lims have sharply increased, accord­ing to offi­cial sta­tis­tics. How­ever, observers have gen­er­ously absolved the prime min­is­ter him­self of any respon­si­bil­ity in this regard, and are will­ing to sus­pend dis­be­lief. The ‘cov­er’ has now been blown.

The fall­out of this on the India-Pak­istan rela­tion­ship can be seri­ous. Obvi­ously, Modi can no longer main­tain with cred­i­bil­ity his stance that he seeks friend­ly rela­tions between India and Pak­istan.

In fact, fol­low­ing the cross-exam­i­na­tion of the gov­ern­ment min­is­ters, the RSS spokes­men in their media brief­ings inter alia brought up the explo­sive doc­trine of ‘Akhand Bharat’ as the guid­ing prin­ci­ple for the Modi gov­ern­ment as regards the India-Pak­istan rela­tion­ship.

Broad­ly, the RSS’s doc­trine is that the great Par­ti­tion of the sub­con­ti­nent in 1947, which led to the cre­ation of Pak­istan, was an aber­ra­tion that can still be got undone if only India worked toward such an objec­tive.

Pak­istan has always had a lurk­ing sus­pi­cion that there is real­ly no day­light pos­si­ble between Modi and the RSS. What used to be a dark sus­pi­cion is now like­ly to become an arti­cle of faith. Pakistan’s advi­sor to the prime min­is­ter on nation­al secu­rity Sar­taj Aziz (who is the de fac­to for­eign min­is­ter) has been quot­ed as say­ing Wednes­day that in Islamabad’s esti­ma­tion, the Modi gov­ern­ment won the 2014 par­lia­men­tary poll on the basis of ‘anti-Pak­istan plat­form’ and has been pur­su­ing the same pol­icy from ‘day one’.

Aziz said, “They (Modi gov­ern­ment) want bet­ter ties, but on their own terms”.

To be sure, the mutu­al rhetoric makes the prospect of a resump­tion of India-Pak­istan dia­logue a remote pos­si­bil­ity. And it should be a safe con­clu­sion that the India-Pak­istan nor­mal­iza­tion will remain elu­sive as long as the Modi gov­ern­ment remains in pow­er.

Do the RSS big­wigs and their wards in the gov­ern­ment real­ize what colos­sal dam­age they are caus­ing to India’s nation­al inter­ests? The 31 per­cent vote share Modi man­aged to gar­ner in the poll last year to cre­ate India’s first ever RSS-run gov­ern­ment does not give these peo­ple the right to super­im­pose their sec­tar­ian agen­da on the entire nation.

India’s nation­al inter­est lies in cre­at­ing a peace­ful exter­nal envi­ron­ment in the imme­di­ate neigh­bor­hood that enables the coun­try to focus on the devel­op­ment chal­lenge through the nar­row cor­ri­dor of time of the next 15–20 years.

Yet, what India is wit­ness­ing is a ratch­et­ing up of ten­sions in the rela­tions with Pak­istan. The past week alone began with India’s army chief Gen­eral Dal­bir Singh shed­ding his fab­u­lous rep­u­ta­tion for being a strong silent sol­dier of dis­cre­tion and reserve – pre­sum­ably, on instruc­tions from the polit­i­cal lead­er­ship – to under­score the readi­ness of the armed forces to wage a ‘swift, short’ war with Pak­istan.

It was an incred­i­bly tact­less state­ment to have been made in the present tense cli­mate of bilat­eral ties with Pak­istan. Besides, the bril­liant gen­eral should cer­tainly know that the only way he could ensure that a war with Pak­istan remained ‘swift’ and ‘short’ would be by nuk­ing that coun­try in the dead of the night.

You don’t need a Clause­witz to explain that the ‘kinet­ics’ of war with Pak­istan (nuclear pow­er with big­ger arse­nal than India’s and with sec­ond-strike capa­bil­ity) will ulti­mately depend on a vari­ety of fac­tors that are way beyond the con­trol of any­one in New Del­hi, civil­ian or mil­i­tary.

Now, it is into this com­bustible mix of rhetoric that the RSS boss­es pre­sented their stark reminder to Pak­istan that India has nev­er real­ly rec­on­ciled with the cre­ation of that coun­try in 1947.

...

As for his Indi­an counterpart’s dire warn­ing, Gen. Sharif was plain­ly dis­mis­sive: “Armed forces of Pak­istan are ful­ly capa­ble to deal all types of inter­nal and exter­nal threats, may it be con­ven­tional or sub-con­ven­tion­al; whether it is cold start or hot start. We are ready!!”

Are we hear­ing the beat­ing of drum pre­sag­ing the begin­ning of anoth­er bloody round of ‘low inten­sity war’ (read vicious cycle of cross-bor­der ter­ror­ism), which cost India heav­ily in human and mate­r­ial trea­sure? Or, could it be that India and Pak­istan are inch­ing toward anoth­er full-fledged war? Time only can tell.

Most cer­tainly, peo­ple in respon­si­ble posi­tion should be care­ful about what they say in pub­lic. What Gen. Dal­bir Singh said about ‘short, swift’ war was prob­a­bly fit for a closed-door meet­ing with the Direc­tor-Gen­er­al of Mil­i­tary Oper­a­tions at the Army Com­man­ders Con­fer­ence but not as the stuff of grand­stand­ing.

Equal­ly, while the RSS boss­es may not be pub­lic offi­cials, they hap­pen to be extra-con­sti­tu­tion­al author­i­ties wield­ing more pow­er than many erst­while emper­ors in India’s medieval his­tory – and they tend to be tak­en seri­ously. Sim­ply put, they should know that the notion of ‘Akhand Bharat’ has no place in the 21st cen­tury world order.

India is not pre­sent­ing a con­vinc­ing pic­ture as a respon­si­ble mem­ber of the inter­na­tional com­mu­nity when the so-called movers and shak­ers in the coun­try behave like hol­low men.

The point is, India is keen to secure a seat in the UN Secu­rity Coun­cil as a per­ma­nent mem­ber on the plea that it wants to con­tribute to inter­na­tional secu­rity and world peace and devel­op­ment. Fun­nily, yoga, which Modi has begun prop­a­gat­ing under the UN aus­pices for the good of the soul and body of mankind, is itself all about self-con­trol.

And, yet, in its own region, India choos­es to pre­oc­cupy itself with sly thoughts about wag­ing a ‘swift short’ war with its unfriend­ly neigh­bor and har­bors delu­sion­ary notions of doing away with a sov­er­eign inde­pen­dent nation that came into being 68 years ago.

The Jekyll-and-Hyde split per­son­al­ity does not do good to India’s image. The coun­try would have been far bet­ter off if Modi hadn’t blown his ‘cov­er’ as a human­ist and a mod­ern­iz­er.

...
India’s nation­al inter­est lies in cre­at­ing a peace­ful exter­nal envi­ron­ment in the imme­di­ate neigh­bor­hood that enables the coun­try to focus on the devel­op­ment chal­lenge through the nar­row cor­ri­dor of time of the next 15–20 years.

Yet, what India is wit­ness­ing is a ratch­et­ing up of ten­sions in the rela­tions with Pak­istan. The past week alone began with India’s army chief Gen­eral Dal­bir Singh shed­ding his fab­u­lous rep­u­ta­tion for being a strong silent sol­dier of dis­cre­tion and reserve – pre­sum­ably, on instruc­tions from the polit­i­cal lead­er­ship – to under­score the readi­ness of the armed forces to wage a ‘swift, short’ war with Pak­istan.

It was an incred­i­bly tact­less state­ment to have been made in the present tense cli­mate of bilat­eral ties with Pak­istan. Besides, the bril­liant gen­eral should cer­tainly know that the only way he could ensure that a war with Pak­istan remained ‘swift’ and ‘short’ would be by nuk­ing that coun­try in the dead of the night.

You don’t need a Clause­witz to explain that the ‘kinet­ics’ of war with Pak­istan (nuclear pow­er with big­ger arse­nal than India’s and with sec­ond-strike capa­bil­ity) will ulti­mately depend on a vari­ety of fac­tors that are way beyond the con­trol of any­one in New Del­hi, civil­ian or mil­i­tary.
...