The CIA has released new documents written in 1996 showing Vice President Al Gore ordered the CIA to enforce strict controls on mass-market security software for personal computers.
The documents were discovered at the Department of Commerce and were released by the CIA in response to a Freedom of Information Act (FOIA) request. The CIA documents are two memos written by CIA Director John Deutch to President Clinton and Vice President Al Gore.
The CIA reports detail federal government efforts to monitor computer communications such as e-mail, using a technique to secretly intercept and decode any messages. According to the CIA director, the back-door keys were to be held by “key recovery agents” licensed by the Commerce Department.
According to one document, a memo written by CIA Director John Deutch, Gore ordered the CIA to tell the Commerce Department to take a “tougher approach to licensing.” The memo states Gore ordered the CIA to “tighten the control regime for encryption products that do not support key recovery.”
Janet Reno, according to Deutch, took a much harder line, supporting an all-out federal take-over of the industry. The Justice Department proposed “legislation that would … ban the import and domestic manufacture, sale or distribution of encryption that does not have key recovery.”
The CIA director, backed by the Commerce Department, rejected the Reno proposals in favor of a so-called “middle of the road approach.” According to the CIA, “We have rejected the policy option of mandatory control because we believe legislation to ban use of encryption in private communications will not be adopted here or abroad, notably in Germany and Japan.”
The memos include the CIA director’s blank copy of a presidential executive order that was later signed by President Clinton in November 1996. The CIA written executive order transferred control of encryption technology to the Commerce Department. The order transferred authority for both mass media software and formerly military items such as radios, and satellite telemetry systems hardened against atomic warfare.
Mass-media encryption software is freely available over the Internet and sold in retail outlets. There are currently NO domestic regulations covering the private or business use of security software in the United States. The software is used to protect medical, financial and personal information.
The Clinton administration considers such PC software to be a threat. Law enforcement claims encryption technology could be used by criminals and terrorists. The Clinton administration considers mass market software a “munition” and strictly controls exports with felony charges backed by the Department of Justice.
Clinton’s plan was to force U.S. computer makers to build back-doors into their products in order to obtain an export license. The CIA director wrote to Clinton, “Our principal lever is export controls, which can influence industry because it seeks to develop products that work worldwide. Thus, our proposal would ease export controls in exchange for industry commitment to build key recovery products and supporting infrastructure.”
Clearly, the Clinton administration was aware of the futile operation to control PC software available in the retail market. The CIA report detailing the imposition of strict controls contradicts an earlier May 1996 Commerce Department document.
The May 1996 Commerce document details a meeting with the CIA, FBI and Department of Justice. The document states: “Efforts to maintain tight controls on encryption in the ‘Internet age’ lack credibility, threaten to impose real costs on U.S. industry and, its competitiveness, and are becoming a political embarrassment for the Administration.”
According to the 1996 Commerce document, “Lost in the debate, but not irrelevant, is the fact that it is virtually impossible to enforce export controls against them when they can be exported by phone and modem or/in someone’s pocket.”
Clearly, it is far easier to control multi-million dollar military grade items than low cost PC software. Rare or hard-to-build electronics such as radiation hardened, encrypted, telemetry control for satellites are not available to the general public nor would they be of much use. Military communications, such as secure satellite control systems, are built to withstand the intense radiation of space or nuclear warfare.
There is no doubt that the Chinese military sought such items for their strategic nuclear forces. For example, in February 1996, a Chinese Long March rocket crashed with a high-tech Loral Intelsat satellite, killing 200 civilians. U.S. investigators discovered that a hardened telemetry control board was removed from the crashed Loral satellite.
Clinton authorized exports of military encrypted communications and satellite telemetry to the communist Chinese. In July 1996, Clinton signed a waiver for Loral to export a fully operational, encrypted, satellite control station to Beijing. According to the GAO, Clinton authorized the direct export of an encrypted air-defense communications system directly to the Chinese Air Force.
Clinton’s signature was sought by Loral’s competitors as well. For example, Motorola wrote the State Department in November 1994, requesting to export encrypted radios to China. The Motorola letter clearly notes that Bill Clinton was signing waivers for other American companies.
The 1994 Motorola letter states “This is to request that your office initiate action to obtain a waiver from requirement for individual export license notifications to Congress for wireless mobile communications systems containing encryption for China. Such a waiver was issued by the President in September of this year for civilian satellite systems and encrypted products for use by American firms operating in China.”
Law enforcement and intelligence agencies are directly responsible for our national security. U.S. intelligence and federal law enforcement officials often pride themselves as being the prime defense against espionage and terrorism. The FBI and NSA are responsible for military grade exports. They have the oversight and the power to prevent exports of multi-million dollar satellites and other military equipment to communist China.
The FBI and the NSA failed America. While overlooking Bill Clinton signing waiver after waiver for exports of military hardware to China — the NSA and FBI decided to go after American citizens.
Yet, the FBI and the NSA are NOT responsible for the millions of personal and business computers in America. Government agencies offer no protection from hackers or virus attacks. The FBI and the NSA are NOT the first line of American digital defense.
The American computer industry established a vast array of anti-virus software and hardware to fight malicious software threats. The same should follow for mass market encryption software which keeps hackers out of unauthorized data.
However, the Clinton policy takes jobs away from American engineers and passes them overseas. According to a November 1998 report from the CATO Institute, “The next generation of advanced encryption technology for e-mail or real-time communications is unlikely to be developed within the United States. … As long as export controls are maintained, jobs, capital and profits will leave the United States as technology companies set up operations elsewhere.”
Bill Clinton and Al Gore insist on controlling domestic mass media and business computer security. They are hurting American security. Their policy costs lives and money. It helps the terrorists, criminals and hackers penetrate vital computer systems that control banking, communications and electric power.
In addition, Bill Clinton used government policy to blackmail American businesses seeking export licenses. Clinton used his office for extortion, selling the secrets of our military communications to enrich himself and remain in power.
The 1998 CATO Institute report calls American encryption policy an “albatross” around Clinton’s neck. The new report released by the CIA shows the Clinton encryption policy was no “albatross.” The encryption policy was a “cash cow,” feeding Chinese Army money directly into Bill Clinton’s 1996 re-election campaign.
Newly released CIA Document and other referenced materials