The libertarianism in the Internet

The Thinker by Rodin

It can be dangerous when politicians open their mouths. In the case of Donald Trump, it’s because he spews hatred and racism and has gathered support from a lot of dittoheads for doing so. But in one way both he and Hillary Clinton have something in common: they don’t really understand the Internet. It would have been wise to defer saying anything at all when you really don’t know what you are talking about.

Trump’s mistake was saying that he was open to closing parts of the Internet as part of the war on the Islamic State, a war that has never been officially declared. I can give Trump only half a demerit because he was prompted by CNN’s Wolf Blitzer’s question, which asked if he would do this, and it’s really a trick question. If Trump knew what he was talking about he’d have said, “Well, of course that’s not possible.” Hillary Clinton opened her mouth a bit too wide in last Saturday’s debate she said that some sort of Manhattan-like project could allow the government to decrypt messages while ensuring everyone’s privacy. But at least she said, “I don’t know enough about the technology”. So a point to her for honesty.

If you want to kill the Internet, kill all the people. Even that won’t work immediately. All those routers would still be moving data around, but no one would be around to read any of it so it would effectively be dead. Why is this? It’s because the Internet was designed to be resilient and effectively unstoppable. What secret communist organization was responsible for such a nefarious deed? Why, that would be the United States Department of Defense. More specifically, it was DARPA: the Defense Advanced Research Projects Agency, known back in the 1960s when it was creating the Internet as ARPA.

And it made sense. At that time, the Internet was not envisioned to be a global network for just anyone, but it was designed to make sure that defense establishments and universities doing defense work could chat with each other electronically and move files around this way. The architecture that was designed ensured that if one path between sender and receiver was down or slow, some other path would be chosen instead. The message had to get through. On the plus side, at least in its initial phases, the Internet was all plain text. Encryption was not a worry because it was not a classified network, but where it was a worry secure lines were leased from the telephone company.

Today’s Internet is basically the old ARPANet’s infrastructure from the 1970s open to everyone. Everyone used it because it was the only model out there but also because it was noncommercial and standards-based. Some private networks from the distant past you may remember tried to do something similar: Compuserve and AOL were two that discovered it could not compete with the awesomeness of the real Internet, once people could access it.

We can’t shut down the Internet on the Islamic State. We can certainly make it more difficult but alas, as the Internet has evolved, so too have the ways to transmit and receive signals. In the old ARPA days I’m pretty sure the only way was to lease lines from AT&T. Today the Internet goes across virtually all data networks. Shut down the Islamic State’s landlines and they will use cell towers. Take down cell towers and maybe they will use microwave relays or satellite dishes. Take down the dishes and they can use portable satellite phones. In any event there are plenty of IS-related terrorists not actually in the Islamic state and they can chat between themselves, it’s just that they will have an easier time of it than those in the Islamic State.

Those of you out there wondering what a libertarian world might look like can see it in the Internet. The Internet excels at fast and disparate information sharing. It also excels in being able to get its messages through come hell, high water or terrorists. No one back in the 1960s could project what the Internet would morph into, but it was all based on protocols that from day one were open and designed to move data quickly. These protocols can be changed, but only in an evolutionary manner if they become a consensus adaptation. Even so, the old protocols will continue to traverse the Internet and all that is needed is the software to send or receive Internet Protocol (for packets) and Transmission Control Protocol (for a message made up of packets). And TCP/IP protocol is built into virtually every computer that communicates with another computer, not to mention all the switches and routers between sender and receiver.

Obviously this architecture has some problems, which are not problems if you are a libertarian. You want the free flow of information and you don’t want government controlling or monitoring it. The good part is the enormous amount of information sharing that occurs that makes our lives such much more interesting and rewarding. The bad side is it empowers terrorists, child pornographers and general criminals to do the same thing.

As for encryption, this is not something where you can have your cake and eat it too. The NSA cleverly put in encryption backdoors into products sold by most of these encryption devices. The encryption industry is now onto this. Tech savvy criminals have already found solutions like OpenPGP, which can likely keep the NSA from eavesdropping, at least in real-time. The government is getting better and faster at decrypting messages by throwing massive parallel computers to decrypt them. Moore’s Law is making it possible to decrypt almost any message without waiting for days, months or years for an answer. Obviously the NSA needs to be pretty selective when they throw these sorts of resources onto decrypting a message.

There is no “let’s have our cake and eat it too” solution to decrypting intercepted messages in real-time. The NSA with its private-key backdoors already tried it, but that’s not an issue if you use devices that don’t have these backdoors. Like it or not, the Internet is must-have technology and it will be used for purposes both good and bad. There is no tech fix to these problems.

However, a social strategy will help somewhat. Encouraging good citizens to rat on their fellow citizens they suspect of illegal use of the Internet is probably the only pragmatic way to address this issue. In that sense, the libertarians, courtesy of the U.S. Department of Defense, have already won.

Bitcoin is libertarian bit nonsense

The Thinker by Rodin

Are you intrigued by Bitcoin? It’s a digital currency much in the news these days. It even got a hearing on Capitol Hill last month. Surprisingly the foundation overseeing Bitcoin came out relatively unscathed. Some places are accepting Bitcoins as payment for actual goods and services. They do so on the assumption the currency has value. Like any other currency it has value because some people assert it has value.

Which raises the question, what is its value? There are clearly things you can do with Bitcoin that are convenient. It’s a sort of digital cash for our electronic age. Only it’s not really cash. Real cash doesn’t leave fingerprints. You make a Bitcoin transaction and the transaction is recorded in the coin itself.

If there is value in Bitcoin, maybe it is from the faith we place in its math. There is not much we trust anymore, but you can still trust math, and Bitcoin depends on math, not to mention encryption algorithms, to assert its value. The number of Bitcoins has a finite limit because of the power of math and algorithms. Each attempt to mint a new Bitcoin requires lots of computers to spend lots of time and use lots of energy. For all its electronic novelty, it’s hardly an environmentally friendly currency. In fact, it’s bad for the environment.

You can’t say that about gold. Granted, the process of getting gold out of the ground is often bad for the environment, but once you have it, there it is, probably to sit in highly protected bank vaults and never to be actually moved or for that matter seen. A Bitcoin is entirely virtual but it depends on lots of computer hardware to mint and to assert its value. You won’t be creating one of these with a pad of paper and a slide rule. In fact, a Bitcoin is entirely dependent on computers and high speed networks. No wonder then that it was abruptly devalued last week when China blocked Bitcoin transactions. Keep it from being used in the world’s most populous country and it has lot less utility. Of course, it’s useless to anyone without a computer or some sort of digital device, not to mention some network so you can trade the currency. So it’s not even universal. You can’t say that about the U.S. dollar.

The larger question is whether a currency built on nothing but math really can have value. It does have value at the moment, as I can actually trade Bitcoins for U.S. dollars, which in my country is what everyone accepts as currency. In the long run though I think Bitcoins are going to be worthless. I don’t plan to own any of them and maybe I can make a case why you shouldn’t either.

First, there is whether counterfeit Bitcoins can be created. New ones can be minted if you have the computer horsepower and these are “legal”, but if they can be created for virtually no computer time then they would be counterfeit. Call me suspicious but I bet either the NSA has already figured out a way to hack it or will soon. In short, to trust a Bitcoin you must buy into its assumption that it can’t be hacked. Since the dawn of the computer age, hackers have demonstrated their ability to hack anything. They love the challenge. It’s reasonable to believe that Bitcoin is going to be hacked one of these days.

Second, there’s the question of what its value represents. I’ve discussed the value of money before. My conclusion is that money essentially represents faith that the country coining the currency will remain solvent and viable. I based this conclusion on the observation that currency value falls whenever these assumptions are shaken. Having a currency based on the gold standard doesn’t seem to make any difference, as the United States has been off the gold standard since the 1970s. Printing new currency doesn’t seem to be that big a deal either, providing the new currency is used to acquire assets of value. This is what the Federal Reserve has been doing since the Great Recession: creating money (none of it actually printed, apparently) and using it to buy long term securities like mortgage-backed securities. Curiously, just printing money is not inflationary when it is used to buy tangible goods. This is providing that the institution printing the money is trusted, and the Federal Reserve is trusted. In any event, investors can value or devalue a currency based on examining its monetary system and the country’s economy. With Bitcoins, you can’t do this. It is backed by no country, which is its appeal to its adherents.

What is Bitcoin really about then? It’s about a political idea; more specifically it’s about libertarianism. It’s trying to be a means by which libertarianism becomes institutionalized. If you are not familiar with libertarianism, it’s all about freedom, buyer beware and minimal (and ideally no) government. Libertarians (at least the committed ones) are vesting their wealth in Bitcoins because it’s how they show loyalty to the cause. They want money to be frictionless and outside governmental control. Arguably, Bitcoin does a good job with this, providing buyers and sellers will accept it as having value.

But libertarianism is an idea, not a thing. Libertarianism is really more of a verb than a noun. A currency though has to be based on something real. The U.S. dollar is essentially backed up by the collective wealth of all of us who possess dollars, or assets valued in dollars, or really any property within the United States. It’s based on something tangible. You buy a house in dollars instead of Bitcoins because everyone in the transaction has faith that those dollars mean something. This is because everyone else is trading in dollars too to buy real goods and services. If the U.S. dollar gets too low, there are things we can do about it. We can petition Congress or the White House to take action. There is no one to go to to complain about the sinking value of your Bitcoins. Assuming the currency cannot be counterfeited, its only value is its finiteness, enforced by math and increasingly expensive computational processes to make new coins. That’s it. As those libertarians say, caveat emptor (buyer beware). Bitcoin buyers, caveat emptor!

This tells me something important: Bitcoin is a bogus currency, at least in the long term. Yes, you can buy stuff with it now, but only from a very limited number of sellers: those who have faith in the idea of a libertarian currency. It’s obvious to me that libertarianism is just not doable as a sustainable way of governing. I have no faith it in whatsoever because its philosophical underpinnings do not actually work in the real world.

I would like to see it in Glenn Beck’s libertarian community, however, if it ever gets built. One thing is for sure, no one is going to build it for Bitcoins. They are going to demand U.S. dollars.

TrueCrypt puts the personal in PC

The Thinker by Rodin

Your computer is somewhat like a post card. Although you may be able to restrict who gets onto your machine, in general the data stored on your computer is stored as plain text and is thus easily compromised.

If you are like me, one of the reasons you own a PC is because you want not just a computer, but a personal computer. “Personal” means more than the freedom to change your screensavers. A personal computer should make your sensitive data available only to you.

Unless you take the time to password protect your documents, your computer is a treasure trove of information about you that you may not want shared. Many applications allow your data to be password protected, but that does not necessarily mean that the data itself is encrypted. Even if it is, that does not mean the vendor’s encryption algorithm is good. Ideally, you would like your private data to be only accessible by you as well as stored and encrypted in a transparent manner. You might even want the NSA to throw up their hands if they were ordered to decrypt your files.

If you feel this way, you want the terrorists to win. No wait, I am parroting our president. Actually, if you feel this way: congratulations. Your personal computer should not be amenable to electronic snooping. The problem is not with your need for privacy, which is entirely natural, but with those elements in society that figure anything is fair game, including your hard disk.

I have been experimenting with a free open source software solution that is fighting back. It is called TrueCrypt. For those of you in the Microsoft Windows world, it can ensure that data on your hard disk or other devices (like your flash drive) is stored in an encrypted format. Once you create your virtual disk (which is some portion of your actual hard disk), it behaves just like any other drive. You can move files in and out of it using tools like Windows Explorer. However, everything stored on this virtual drive is encrypted.

There is not a whole lot of data I want to keep truly private, but there is some. My Quicken data files are an obvious example. While Quicken allows you to save your data in an encrypted format there is the annoying password I have to provide each time I start it and the latency from starting and using the program. Moreover, I suspect their encryption scheme is rudimentary. Of course if you have an encrypted virtual drive you can store anything you want inside of it that you consider private, from letters from old boyfriends, to your electronic diary to your favorite porn.

If you decide to buy Windows Vista Ultimate, you can pay money for this level of protection. Of course, most of us will not want to spend extra money. In addition, most of us Windows users are still in the Windows XP world where the Windows “experience” does not include this kind of transparent file encryption. Moreover, call me paranoid, but I have a hard time trusting my hard disk to Microsoft in the first place. I would much rather trust my privacy to an open source product like TrueCrypt than to Microsoft.

After installing Truecrypt, to store private files you must first create a virtual disk. It can be as small or big as you want. From the perspective of Microsoft Windows, it is just another file on your machine. (TrueCrypt can also format entire disk partitions or devices.) If you want to make a very big virtual disk, it may take some minutes to format it. Here is Truecrypt’s downside: you must start Truecrypt, enter your password, point it to the location of your encrypted volume and then assign it to a drive letter. This is called mounting and it can take 15-30 seconds. Once the volume is mounted, it is then accessible. So if you do not dismount it before walking away from your computer, data on it could be accessible to someone else. Since it is just another drive from the Windows perspective, if you are a sloppy person who cannot be bothered to install a firewall, virus protection software and anti-spyware software, it is still possible for others to get at your private data. If you use Google Desktop Search, you will want to make sure it does not search your encrypted drives.

While not a perfect solution, Truecrypt is the good enough 90% solution at a price that is impossible to beat. While you cannot hide the space it consumes on your hard disk, you can give each virtual drive a boring looking file name. One you have your virtual disk, you can even hide a volume inside it. This way even if you were forced to divulge your password, the person would not necessarily see your stored files, since the hidden volume would not be shown.

My next computer will likely be an iMac. I assume Apple is smart enough to include features like this by default. While I wait for a financial justification to replace my PC, solutions like Truecrypt help me believe that for the first time I really do have a personal computer.