Sunday, March 29th, 2009
IT is said to be the most impregnable vault on Earth: built out of granite, sealed behind a 22-tonne door, located on a US military base and watched over day and night by army units with tanks, heavy artillery and Apache helicopter gunships at their disposal.
Since its construction in 1937, the treasures locked inside Fort Knox have included the US Declaration of Independence, the Gettysburg Address, three volumes of the Gutenberg Bible and the Magna Carta.
For several prominent investors and at least one senior US congressman, it is not the security of the facility in Kentucky that is a cause of concern: it is the matter of how much gold remains stored there — and who owns it.
They are worried that no independent auditors appear to have had access to the reported $137bn (€104bn) stockpile of brick-shaped gold bars in Fort Knox since the era of President Eisenhower.
After the risky trading activities at supposedly safe institutions such as AIG they want to be reassured that the gold reserves are still the exclusive property of the US and have not been used to fund risky transactions.
In other words, they want to be certain that the bullion has not been rendered as valueless as if a real-life Goldfinger had stolen it.
“It has been several decades since the gold in Fort Knox was independently audited or properly accounted for,” said Ron Paul, the Texas Congressman and former Republican presidential candidate. “The American people deserve to know the truth.”
Mr Paul has so far attracted 21 co-sponsors for a Bill to conduct an independent audit of the Federal Reserve System — including its claims to Fort Knox gold — but an organisation named the Gold Anti-Trust Action Committee (GATA) is taking a different approach.
It has hired the Virginia law firm William J Olson to test US president Barack Obama’s promise to bring “an unprecedented level of openness” to the US government.
Next month it will file several Freedom of Information requests for a full disclosure of US gold ownership and trading activities.
Nuclear
“We’re taking the president at his word,” said Chris Powell, of GATA.
“If you go online you can find out how to build a nuclear weapon but you won’t find any detailed records on central gold reserves.”
A month after former US president Richard Nixon resigned over the Watergate affair, Congress demanded to inspect the contents of Fort Knox but the trip to Kentucky was dismissed by critics as a photo opportunity.
Three years earlier, Mr Nixon brought an end to the gold standard when France and Switzerland demanded to redeem their dollar holdings for gold amid the soaring cost of the Vietnam War.
Many gold investors suspect that the US has periodically attempted to flood the market with Fort Knox gold to keep prices low and the dollar high — perhaps through international swap agreements with other central banks — but facts remain scarce and the US Treasury denies that any such meddling has gone on for at least the past decade.
Pressure for more openness is mounting after the collapse of the global banking system and renewed interest in a return to the simpler era of the gold standard — a subject that is likely to be raised at the G20 summit next week.
China and Russia are calling for the creation of a new world reserve currency amid fears that the Federal Reserve’s quantitative easing policy — essentially printing money — might cause hyperinflation, then collapse.
A spokesman for the US Treasury said that US gold holdings were audited every year by the Department of Treasury’s Office of Inspector General.
He confirmed that although independent auditors oversaw the process they were not given access to the Fort Knox vault.
The website of the US Mint says that the 147.3million troy ounces of gold in Fort Knox “is held as an asset of the US”. It does not elaborate. (© The Times, London).
- Chris Ayres in Los Angeles
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Sunday, March 29th, 2009
Freedom House condemns the UN Human Rights Council for undermining the universal right to freedom of expression by once again passing a resolution that urges members to adopt laws outlawing criticism of religions.
The “defamation of religions” resolution, introduced by Pakistan on behalf of the Organization for the Islamic Conference (OIC), passed today by a vote of 23-11, with 13 abstentions. Muslim nations have been introducing similar resolutions since 1999, arguing that Islam-the only religion specifically cited in the text-must be shielded from unfair associations with terrorism and human rights abuses.
“These countries are using the UN to expand and bring legitimacy to their frontal assault on freedom of expression,” said Paula Schriefer, Freedom House advocacy director. “This assault starts at the level of domestic blasphemy laws present in many OIC countries, which are routinely employed to harass and imprison religious minorities, political dissenters and human rights advocates, and is elevated to the international level through resolutions at the UN.”
Freedom House is especially disappointed that South Africa, a liberal democracy whose citizens’ have a deep understanding of how such laws are used to punish dissenters, continues to back these resolutions. Similarly, strong democracies such as South Korea, Japan, India, Mexico and Brazil should have actively worked to defeat the resolution, instead of casting abstention votes.
In contrast, Freedom House applauds the leadership shown by Chile in rejecting the resolution and hopes that Chile will work to persuade other Latin American countries to vote in a manner that accurately reflects the democratic nature of their region. Such an effort would send a message that freedom of expression is a universal right and not just a right to be enjoyed by the citizens of Western democracies.
Text condemning “defamation of religions” was originally part of a draft declaration to be issued at the Durban II anti-racism conference in Geneva next month. But it was withdrawn after Western nations said they would pull out of the UN conference unless it was removed.
In addition, supporters of “defamation of religions” are increasingly attempting to incorporate the concept into existing human rights law, such as the International Covenant on Civil and Political Rights (ICCPR). They claim that “defamation of religions” leads to “incitement of hatred or violence,” which is a legitimate restriction under the ICCPR’s Article 20.
“It’s preposterous to suggest that criticizing or satirizing a religion automatically leads to hatred or violence or in any way prevents its adherents from practicing their faith,” said Schriefer. “In fact, the ability to question religious beliefs or tenets is not only a right of free expression, but a critical aspect to freedom of religion itself.”
Of the 14 OIC members on the council, only Indonesia is ranked Free in Freedom in the World, Freedom House’s annual assessment of political rights and civil liberties. Four of these countries-Cameroon, Egypt, Qatar and Saudi Arabia-are ranked Not Free, demonstrating an absence of political rights and a systematic denial of basic civil liberties. A further analysis of Freedom in the World comparing levels of freedom of expression and belief within OIC countries to regional groupings finds that only the Middle East and North Africa would receive a lower score in these categories.
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Free Expression Assault Continues at UN Human Rights Council
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Sunday, March 29th, 2009
The Networker
There’s a delicious moment in Alastair Beaton’s satirical film, The Trial of Tony Blair, in which the former prime minister is finally arrested for war crimes on a warrant from the international criminal court. One scene shows the standard police procedure as Blair is inducted by the desk sergeant in a London station. Towards the end of the rigmarole, the policeman moves to take a saliva swab from him.
Blair is aghast, asks him what he is doing and - after the policeman has explained that’s he’s taking a DNA sample - asks who brought in such a stupid law. “You did, sir,” is the response.
The irony, of course, is that Blair led New Labour down the path towards an authoritarian, target-driven, intrusive state. His administration dreamed up the Regulation of Investigatory Powers Act 2000 handing draconian powers of surveillance to every goon and jobsworth in the land. He was the guy who undermined parliament and took the country to war on false pretences. Oh, and he was also the PM whose administration insisted on keeping forever on file the DNA records not just of criminals but anyone who’s ever been arrested.
All of this was brought to mind this week with the publication of Database State, an amazing report by IT security experts commissioned by the Joseph Rowntree Reform Trust in the aftermath of the loss, by HM Revenue & Customs, of the entire child benefit database in October 2007. Spurred by the HMRC fiasco, and all the subsequent data losses that came to light in the months that followed, the trust sponsored a meeting of academics and activists with an interest in privacy. These experts attempted to map Britain’s database state, identifying the many public sector databases that collect personal information about us.
Not surprisingly, the task proved to be too big for one seminar, so the trust commissioned the Foundation for Information Policy Research (FIPR) to conduct the most comprehensive survey ever of Britain’s government databases. The report was published last week (it’s available online at www.fipr.org) and makes sobering reading for anyone who cares what’s happened to this country since Blair & Co swept to power in 1997.
Of the 46 databases assessed, only six are found to have “a proper legal basis for any privacy intrusions and are proportionate and necessary in a democratic society”. Eleven are “almost certainly illegal under human rights or data protection law” and “should be scrapped or substantially redesigned”, while the remaining 29 were found to “have significant problems and should be subject to an independent review”.
The creation and updating of these databases is central to the Blair/Brown “transformational government” programme, for which the government is currently unable to attach an estimated cost. But the UK public sector currently spends £16bn a year on IT projects and had - at least until the credit crunch - planned to spend £100bn on databases and related stuff over the next five years.
Even these days, these are huge sums, which reflect the New Labour belief that IT systems will one day give the government the information it needs to control every aspect of our lives, defeat terrorism and eliminate crime. Much of the proposed expenditure is devoted to enabling colossal official databases to talk to one another.
The goal is that one day the government will have a seamless cradle-to-grave electronic record of every aspect of a citizen’s life. It will track school and medical records, every phone number dialled, every email and text message sent and received, every website visited, every speeding fine and passport issued, every vehicle registered, every mortgage or loan taken out, every foreign trip undertaken, every tax return filed and benefit claimed. And, of course, every encounter with officialdom. It’s an Orwellian nightmare rationalised by the need for efficiency in the spending of public money but designed to change forever the relationship between the individual and the state.
The FIPR/Rowntree survey has uncovered the extent to which the UK government is already operating outside the law. That would once have been enough to call a halt to New Labour’s Orwellian project. But those days have gone. The only thing that will stop Britain’s descent into the National Surveillance State is a change of government. Fortunately, looking at the opinion polls, we might not have too long to wait.
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New Labour’s dream is a surveillance state nightmare
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Sunday, March 29th, 2009
Google’s new Street View service - which displays 360-degree photographs of streetscapes in 25 British towns - has made it a challenge getting pages proof-read in the Wired offices this week. First, we spot the magazine’s associate editor in a skirt in a West London street (to be fair, he insists it is a kilt). Then we discover that Google’s face-blurring algorithm has bizarrely pixellated Bobby Sands’s face on a Belfast mural, presumably to protect what the software assumes is his privacy.
But Simon Davies, who runs a generally estimable campaign group called Privacy International, isn’t much amused. Street View, Mr Davies complained to the information commissioner this week, “has created numerous instances of embarrassment and distress”, and so he pledged to bring a legal test case.
Why? A 15-year-old had complained to Privacy International that Google snapped him carrying a skateboard “which his parents had expressly forbade him from using”; oh, and a married man was captured “speaking at close proximity with a female colleague”. Forget ID cards, registers of children’s DNA and government trawling of our e-mails - in Street View, we have finally identified the ultimate threat to British citizens’ liberty.
Well, no, actually. Although some of those photographed exiting sex shops or being sick in pub car parks may have prompted panicked deletions by Google’s public-relations machine, the public sphere remains essentially public. Despite the creeping incursions of French-style privacy legislation, one can still lawfully capture images from and of the British public commons - so it’s an absurdity for those sneaking a work-break cigarette, or flirting at a bus stop, to claim that somehow their rights have been breached by a passing camera. A right to absolute privacy in public? Get over it.
No, the real public threat from Google is its ever-inflating scale as an unregulated profit-seeking company to which we are entrusting unprecedented swaths of confidential information. What was once simply a niftily effective search company now serves as a personal calendar, an e-mail archive, a store of our word-processing documents, a video repository, a mobile-phone-tracking service, a road-travel itinerary - a vigilant monitor of our medical obsessions, physical movements and political leanings. And that’s fine, provided Google is transparent and sensitive about how it collects and uses our personal data, and that it guards it unfailingly. But as Privacy International pointed out, after a survey found Google to be the worst-ranked leading internet company for respecting user privacy, it is secretive, even hostile, about the use to which it puts our data, often for an indefinite length of time. That is something that should concern us all - especially with the boom in cloud computing.
Previously, we stored most of our data on computers that we controlled in our homes or workplaces. Today, as we rely increasingly on a “cloud” of distant servers to host our e-mail or calculate our taxes, we are shifting such information at an unprecedented scale to networks administered by private corporations. So let’s say you’ve archived your family photos on Google’s Picasa, your confidential accounts on Google Docs and revealed your sexual preferences during searches of Google Images. Admit it: you have no idea how this might be used to help advertisers to target you personally, or governments to profile you surreptitiously.
I write as an admirer of a company whose innovations have enriched our digital lives. But I worry that its dominance is outpacing governments’ ability to challenge it. Two years ago I warned about the online trail Google collected about you “for ever”, all linked to a personally identifiable Internet Protocol address. I suggested that their proposed $3.1 billion acquisition of DoubleClick, the ad-serving business built on “understanding” internet users, gave a worrying indication of its corporate thinking. DoubleClick had made proud assurances about users’ privacy protection, until its CEO was forced to admit the company had made a “mistake by planning to merge names with anonymous user activity across websites in the absence of government and industry privacy standards”.
Earlier this month, Google launched “interest-based advertising” - what others call behavioural targeting - serving advertisements to users based on their online activity. Yet Google is not simply monitoring what you do at its own pages - it is also tracking your interests as you access other unrelated websites. A key benefit, it says, is that it will be able to serve you adverts that more accurately reflect your interests. But do you really want one company to know so much about you? Privately held data has a habit of leaking out. As recently as March 7, a security flaw meant that private papers stored at Google Docs could be accessed by unauthorised users. Mistakes happen - but the volume of data that the firm holds makes it a target for malicious hackers.
Then there is the immutable law of the digital age that data collected for one purpose may be used for purposes never originally intended. We have no idea how future technologies will exploit our historic data trail in ways that may disadvantage us. Will life insurers penalise our past medical search queries, or the tax office fret that we are aspiring to products beyond our declared income?
What we do know is that one database has an innate desire to merge with another to create ever more detailed personal profiles. Wired journalists have been investigating how broadcast, telecoms and internet businesses are planning to mine our viewing and clicking data as never before. Already, your TV set-top box can provide a vast information trail, allowing analysts to know whether you’ve fallen asleep, who in the family is using the remote according to how they navigate the menu, and what (based on the shows and ads they view) they want out of life. Now, let’s imagine how much more powerful this information would be if linked to other personal databases - not just your internet trail, but your purchase history at the supermarket.
Add to this near-future scenario interactive digital billboards that recognise faces and serve targeted ads based on what the database knows about you. And then crunch in real-time mapping of your precise location, based on signals emitted from your mobile phone. All, of course, benign services that will benefit the consumer by targeting special offers when in the vicinity of a store … But have we debated sufficiently how we want such information to be used, and what is being done to ensure that it does not fall into the wrong hands?
Google - did I mention? - has a rather cool mobile-phone tracking program called Latitude, which lets you know where your friends are according to signals emitted from their phones. Again, all perfectly fun, and Google makes both parties opt in to being tracked. But let’s just imagine that a jealous partner gains access to your unattended phone and enables Latitude without your knowledge. Or government bureaucrats, never satisfied with the extent of their power to track the populace…
This is the moment for us to demand clear answers from the tech industry’s data crunchers, not only Google, and to educate ourselves about what we are giving away. Because when one unaccountable company knows where we are, who we’re e-mailing, what’s in our work documents, what we’re buying and thinking - well, that starts to add up to real information.
David Rowan is the editor of Wired magazine, which launches in the UK on Thursday
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