On July 13, my brilliant friend Richard Dale Fitzgerald II (just
“Dale” to friends) alerted me to a piece of his, just published by the
funniest, most misanthropic news and views portal on the Internet,


“Encryption, Finance, Freedom, and You,”
the article draws on current trends to form a fascinating if not entirely original argument.

To doomsdayers who bemoan the daily intrusions of Big Brother and the continual cheapening of our rights, he replied, in the typical Fitzgerald fashion, “I say to you Rejoice! We won, and nobody seems to have realized it yet.”

We won?

I began this column on a day — one of many this year — that will live in infamy.

A Florida jury just awarded a $144.8 billion — with a b — verdict to a bunch of ex-smokers and their lawyers because they were either too stupid to realize that “cancer sticks” or “coffin nails” are bad for you, or they were willing to perjure themselves to that effect. Heads of major cigarette companies pleaded with jurors — please! — not to “bankrupt us 10 times over” and confessed that they had been bad boys in the past, but they had changed. Honest.

Those 12 paragons of virtue and civic participation adjusted their olive branches, took one look at the crowd and rendered their verdict: no mercy.

It was disgusting.

By some eerie coincidence, on the same day, a jury in Texas decided that the government of the United States of America cannot be held financially — not criminally, just financially — responsible for surrounding a compound of religious dissenters in Waco, Texas, and allowing the place to burn to the ground with women and children inside.

It was sickening and shameful.

But, says Dale, we’ve won. Really.

Question: Was this article written under the influence of crack cocaine or a mixture of some serious inhalants?

Answer: Now what kind of a question is that?

Question: OK, he says, “We’ve won!” How?

Answer: Technology.

“We are,” says Dale, “on the cusp of the greatest transformation of human society ever. The Network Age is upon us, and just as the industrial revolution allowed freedom (and tyranny) to spread across the world, the Network Age will continue both trends at a rapidly increasing velocity.”

This time, however, “the balance of power has … shifted to the Networked (M)an.”

Interesting. How so?

Without getting too technical, he argues that since money is nothing more than a way to transmit information, encryption technology will beget digital currency that will soon shake off the shackles of government fiat currency. When this happens, “since millions of transactions will be taking place somewhere at any given second, no regulatory body in the world (will have) sufficient resources to monitor and decrypt even a small percentage of them.”

Voila! Complete financial freedom. And affluence while we’re at it.

A pair of fictitious Network Man examples buttress his argument: Bob and Liz.

Bob, a 20-something computer programmer, is raking in the dough. Because he knows a thing or two about programming and finances, he is able to program special “bots” to convert digital money into shares and options for companies all around the world while he takes in lunch. The $100 he makes for writing a quick patch script for a client quickly pays for the lunch and then some. By the next week, it’ll be worth $150; by the next month, $500. All of these transactions are encrypted and thus fall outside the oversight of Big Brother.

Liz is a lawyer in San Francisco. Her clients settle their bills by wiring the money to an offshore tax haven. Being the upstanding citizen that she is, she still pays taxes on it; well, sales tax, sometimes (when she can’t find an item on the Internet) and property taxes (pretty hard to hide that cabin on the lake from the tax authorities). Other than that, she’s home free; no income tax, no payroll tax, no death tax, no capital gains tax.

To which, the New York Times’ Paul Krugman has the perfect reply, “Come the Revolution, they shoot these people first.”

Before debunking his argument, let me at least tip the brim of my hat to Dale for having a very polished and finely tuned crystal ball. While many Paul Ehrlich wannabes are predicting that a lack of fresh water will lead to wars and massive dehydration (water filtration anyone? And oceans?), he correctly diagnoses the coming clash: Big Brother vs. Network Man.

For proof, just take a gander at my favorite cyberpunk reporter’s July 15 column for Wired Online. Washington Bureau Chief Declan McCullagh writes on two disparate events that are really variations on a single theme:

One, Treasury Secretary Lawrence Summers — often mentioned as a likely successor to Alan Greenspan — sounded off on the dangers of encryption and offshore tax havens before a global group of fellow tax collectors.

Here’s the scary part: According to the dispatch, “Summers pleaded with his colleagues to craft global rules that would require Americans to pay taxes when buying products online or getting paid electronically.”

And two, HavenCo, subject of the July cover story of Wired Magazine, is a company with a vision: to build a completely private data pipe in the North Sea that answers to nobody. Once operational, it would allow clients to shield data from all of those persnickety modern peeping toms; competitors, lawyers, regulators.

It was thought to be in the ideal location as, due to a 1968 English High Court decision, the Principality of Sealand (host of the platform in the sea) was placed out of the grasp of the British government. Until it was learned what these young upstarts are planning, that is. Now, “(It) turns out that the British authorities have changed their minds. This week immigration officials at Heathrow barred a HavenCo engineer from entering the country.”

The owners insist that this changes nothing, but why do I have the feeling that they’re wondering when the other shoe will drop?

The point here is not to rain on Dale’s parade but to declare that there are no guarantees that the good guys will eventually win.

He and everybody else who’ve ever declared themselves to be on “the right side of history” need to learn that justice in this world is a scarce commodity. Their struggle for a freer world with smaller and less invasive governments is just that: a constant bitter struggle against stupidity, entrenched interests and human nature itself.

Take Dale’s two fictitious examples. What is to keep the U.S. government from seizing Bob’s computer on suspicion of money laundering associated with drugs? Very little. Assets forfeiture law requires Bob to prove that he isn’t guilty, not the government to prove that he is. And once they have his computer, they can find all kind of tax evasions to charge him with. Liz may have a harder time avoiding sales taxes when Uncle Sam decides to institute a national sales tax for the purpose of “fairness” and crack down on private shipping.

Further, he forgot to factor Pedro into the mix; the resentful son of migrant workers who is sick of being screwed by the government while his more affluent wired neighbors avoid most of the bite. Think he wouldn’t rat out a bunch of rich tax cheat yuppies for a percentage of the take? Think again.

To quote Dale again, “Freedom, says Ayn Rand, is the fundamental requirement of man’s mind. If that statement is true, then all of humanity is striving in some way to increase freedom.”

I wish it were true, but it’s not. There are a whole slew of impulses — greed, resentment, a pathological need for order, arrogance, thoughtlessness — that swing the other way.

When Whittaker Chambers turned from Russian spy into courageous informant and apologist, he wrote, in his biography, “Witness,” that he was going from the winning side of history to the losing one. He was wrong — thank God — but it wasn’t a given. Here’s what separates the realists from the utopians: The bad guys could have won.

Network Man had better keep his powder dry.

Jeremy Lott
is the assistant managing editor of WorldNet Magazine, the sister print publication of WorldNetDaily.com.

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