The terrifying “smart” city of the future

Cities across the country are implementing smart technologies — with grave implications for our personal freedoms

The terrifying "smart" city of the future
This article originally appeared on AlterNet.

Imagine a world without waste. A place where the train always comes on time, where streets are plowed before snow even stops falling, and watchful surveillance cameras have sent rates of petty crime plunging. Never again will you worry about remembering your keys because your front door has an iris recognition system that won’t allow strangers to enter. To some people, this kind of uber-efficient urban living sounds like a utopian dream. But to a growing number of critics, the promise of the “smart city” is starting to seem like the stuff of nightmare.

Smart cities are loosely defined as urban centers that rely on digital technology to enhance efficiency and reduce resource consumption. This happens by means of ubiquitous wireless broadband, citywide networks of computerized sensors that measure human activities (from traffic to electricity use), and mass data collection that analyzes these patterns. Many American cities, including New York, Boston and Chicago, already make use of smart technologies. But far more radical advances are happening overseas. Masdar, in Abu Dhabi, and Songdo, in South Korea, will be the first fully functioning smart cities, in which everything from security to electricity to parking is monitored by sensors and controlled by a central city “brain.”

The surveillance implications of these sorts of mass data-generating civic projects are unnerving, to say the least. Urban designer and author Adam Greenfield wrote on his blog Speedbird that this centralized governing model is “disturbingly consonant with the exercise of authoritarianism.” To further complicate matters, the vast majority of smart-city technology is designed by IT-systems giants like IBM and Siemens. In places like Songdo, which was the brainchild of Cisco Systems, corporate entities become responsible for designing and maintaining the basic functions of urban life.



Smart cities are predicated on the neoliberal idea that the market can fix anything—that companies can manage cities better than governments can. Their advocates claim that they will enhance democratic participation by relying on crowdsourcing and “civic hacking projects” that allow locals to use newly available data to solve municipal problems. But they ignore the fact that private corporations are the ones measuring and controlling these mountains of data, and that they don’t have the same accountability to the public that government does.

In the Nation last year, urban theorist and author Catherine Tumber expressed some of the principle concerns about smart tech, reviewing Anthony Townsend’s Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia. (Full disclosure: I fact-checked the review). Tumber asserts that “the economics of ‘smart’” are in keeping with “the ramped-up market rationalization carried out by finance monopoly since the Civil War, culminating in a minimally civic world fit only for…the unencumbered self.”

I caught up with Tumber via telephone at her office at Northeastern University’s School of Public Policy and Urban Affairs, where she is a visiting scholar, to talk about what the rise of smart cities means for our understanding of urban life.

Editor’s note: This interview has been condensed and lightly edited for clarity.

Allegra Kirkland: How did you first become acquainted with the concept of smart cities?

Catherine Tumber: I had been aware of them kind of through the ether because I pay attention to cities, and I’m very much aware of what’s going on in the digital world in a broad sense. I think it’s quite dangerous actually, in all kinds of ways….

I thought Townsend did a good job laying out what the fault lines are: the big digital systems corporations like Siemens and Cisco and IBM versus what these hacker “democratic heroes” are trying to do. I found that to be useful but I wasn’t persuaded that they aren’t all part of the same sort of dangerous direction of things.

AK: These digital innovations are supposed to be all about access to information and transparency, but it seems like many people don’t even know these initiatives are going on. Like Chicago, Barcelona, and all of these other urban centers are now considered “smart cities” but I feel like most people don’t think of them that way.

CT: I think people are only vaguely aware.

AK: It seems like these major urban initiatives are being conducted largely out of the public eye, without public oversight or involvement. Maybe there are some smaller initiatives being carried out by civic hackers, but the major ones have to be implemented by corporations or the government because regular people don’t have the ability to build that kind of infrastructure.

CT: Right, these are major infrastructure projects.

AK: And there’s no means of opting out. Once a city integrates smart technology, your information gets caught up with all the rest, whether you want it to be or not.

CT: Exactly. And also what’s often not taken into account, and I guess you have to live long enough to really see it—though it’s happening very quickly in our time—is that when you introduce a whole new paradigm of infrastructure, the old infrastructure dies. So it ends up being coercive. At some point, you really have to participate in it or you are not able to execute that function, whether that function be communications or entertainment or transportation or energy.

For example, if you did not really want to be available on a cell phone at any given moment or own one, and wanted to simply rely on a landline, that was fine as long as you were home. But they stripped out all of the phone booths. That was really completed by around five years ago. So it really forces your hand quite a bit.

AK: You seem skeptical of the idea that smart cities are inherently democratizing—that they are sites of greater sociability and inclusion. Does that seem plausible to you? 

CT: I think that digital technology, aside from providing all kinds of information that is trackable, holds up the false promise of greater democratic participation. It holds out a sort of false sense of moral agency, for one thing. The argument as I understand it is that crowdsourcing provides people with a different, less curated sense of democratic participation. It involves reaching out to individuals, so it’s a version of democratic practice. I think the jury is still very much out on whether that is persuasive.

Part of what I think is important and rich about democratic culture as a living tradition is that it brings people of very different backgrounds and types together in surge spaces. And crowdsourcing tends to be consistent marketing in that it excludes whole groups of people, just because of the way it works. It’s not even intentional.

AK: Because of the kind of people who get surveyed, who are aware that these kinds of civic campaigns are going on and would get involved?

CT: Yeah. I find that to be somewhat dubious…for the long-term health of the civic project.

AK: It seems like there’s a fundamental split between people who think there is something organic and inexplicable about the ways human beings come together in cities, and those who believe that all human behavior is quantifiable—that we can rely on data to understand how humans interact. Which side of the line do you fall on?

CT: Digital technology and its use compresses experience. It tends to lead to niche cultures; it tends to lead to a sense of being untethered, as if that’s the golden pathway to real freedom. There are several traditions of political philosophy that hold that its important to be tethered so that you have a sense of the limits of yourself and of what it is that humans can do in the time that they have on this earth. This sense of endless freedom can lead to a very false sense of utopian promise that is simply unrealistic and unwanted. It’s yet another way that we’ve decided to take a pause from history and what history has long told us.

There are some things that you really don’t play with. People have acquired great wisdom over the ages—across the globe, this isn’t just a Eurocentric thing—about what it means to travel and to leave home and to come back. These are all the great stories and myths and fables. Technology kind of flattens all of that.

AK: This is sort of a related question, but what do you think are the primary things smart cities take away from the people who live there? What do we lose in these sorts of manufactured urban environments?

It makes me think of the complaints about the gentrification of places like New York City. Michael Bloomberg created new green spaces in Times Square and along the waterfront, made city services more efficient, rezoned districts, and now we have this sanitized, business-friendly, soulless city. The neighborhoods look the same; there’s no mixing of social classes, no weird dive bars. So you’d think smart cities, with their emphasis on homogeneity and efficiency, would be equally off-putting to people.

CT: I think it’s a matter of the convenience of it and the novelty of it. But smart technology is relatively new and there are so many unexamined consequences, as I think there are with any major technological change like this.

I think that we’re only beginning as a culture to wince a little and take a second look at this. … There really hasn’t been any sort of consensus about what the right manners are in using these technologies. Across the world for time immemorial, every culture had some understanding of manners, and I don’t mean that in the prim Victorian sense. But just some ways in which you convey unspoken, coded assumptions about respect and caring and common courtesy and stuff like that. We haven’t had that conversation here. …The main point is that there are real unintended consequences of this.

AK: The corporations behind smart cities throw around all these statistics about how smart technology reduces crime, reduces waste. So it makes you feel like a Luddite to say that you’re uncomfortable with these technologies because there is all of this evidence that they’re successful. But I feel like there’s a difference between using technology to fix a specific urban problem, like Rio de Janeiro using weather tracking to forecast flash floods, which are a major problem there, and places like Songdo, where you’re really rebuilding the concept of the city from scratch and dictating how people should live. 

CT: Yes, they’re riddled with totalitarian overtones, and that’s built into it, it’s part of the built structure.

AK: So do you think smart city initiatives are not necessarily problematic, and it’s just when they’re applied on the scale of an entire city that it gets out of control?

CT: I’m mainly concerned with this assumption that this is new, this is shiny, this is innovative, to use everyone’s favorite buzzword, and that we should just do it. A lot of people don’t really understand what’s involved. There’s a tendency to have it sort of inflicted on people, and part of that is the way the business model for digital technology, at least at this point in time, works, which is to make everything cheap. It doesn’t cost the public very much to say, oh, okay, because there’s not much of a pricetag on it yet. Part of the reason why it’s so cheap is that so much of the work is based on volunteer labor.

So many of these civic hackers, all these projects and apps they develop, so much of that is based on free labor. People try to frame that as a sort of revival of Tocqueville—voluntary associations and all that stuff. But instead it’s just downright free labor, like unpaid internships or something. That’s why I’m very skeptical of all of this; this is really just another variation on the sort of neoliberal business model that we’ve been using now for the past 35 years and has grown out of control. This is just another iteration of that with nice shiny technology attached to it. Americans are always suckers for technological determinism.

AK: Sure. I feel like privatization initiatives in cities have multiplied in recent years, with cities selling stakes in public housing to private developers—

CT: And all the stuff Rahm Emanuel is doing in Chicago.

AK: Exactly. It seems like smart cities are sort of the ultimate example of the corporate-designed urban environment. Should that inherently be a cause for concern? It goes without saying that corporations don’t always have the best interests of people in mind. And places like Songdo were designed to have minimal regulatory barriers. They prioritize technological innovation and wealth generation, so it seems like they could really deepen existing economic inequality. If you’re not part of those spheres, you don’t really have a place in these cities.

CT: To really take on wealth inequality and the kind of ravaging done by the spoiling land use policies that we’ve had in place since after World War II, we need to have a body of ideas and practices that have a clearly defined sense of what their political vision is: what the good life is and how to get there. What are our fundamental values, our limitations? All of this smart city design is apolitical. That’s the problem. The longer it seeps into our political culture, the more it will drain the public imagination of the next generation, of what a real political movement looks like and why politics are important.

AK: It also seems like the obligation of government to provide essential public services like housing is reduced. It becomes the responsibility of corporations and developers, so there’s less accountability, less control over pricing and over the data the companies acquire.

CT: Then there’s all this debate about regulations—which industries require more or less. These are all very difficult questions of practicality and philosophy. And I fear that our political discourse and understanding of the world is being degraded and coarsened by the uncritical dissemination of a digital substitute for a real politics.

AK: Another thing I wanted to bring up is the surveillance concern. I read a quote from the mayor of Rio, which is a smart city, saying “The operations center allows us to have people looking into every corner of the city, 24 hours a day, seven days a week.” He meant it as a positive, but that’s a sort of terrifying statement. What are your thoughts about the surveillance implications of smart technology?

CT: All these sensors will and are being used to invade our privacy. There are good and bad things about that. You know, here in Boston we had the marathon bombers and they were very quickly apprehended, partly because that area is so rigged up with security cameras. We have to decide whether it’s worth it.

Another thing I’ve been concerned about is thinking about the difference between Aldous Huxley and George Orwell. You know, George Orwell talked about Big Brother and the authoritarian state, the invasion of privacy. Huxley talked more about the internalization of oppression, and I’m in some ways even more concerned about that. It’s a cultural critique of the way we internalize and accept the terms of our lack of freedom. We accept the deprivation that totalitarian movements end up exacting on us. So we end up being our own worst enemies. It’s almost like we don’t even need Big Brother.

AK: Sure. We voluntarily give up so much information about ourselves.

CT: When I see people walking around in public as though they’re wearing a blindfold because they’re so absorbed in another world on their devices, that has the look to me of self-degradation and degradation of the public realm that is more effective than security cameras. Because people won’t resist. They’re not even aware of their surroundings, just as animals moving through the world. So why would they be able to muster whatever it takes to resist the invasion of privacy by the state or by corporations, for that matter? It just all represents such a contraction of democratic culture to me. It worries the heck out of me.

 

 

http://www.salon.com/2015/02/28/the_terrifying_smart_city_of_the_future_partner/?source=newsletter

 

US economy in deflation and slump

corecpi

By Andre Damon
28 February 2015

The US Commerce Department said Friday that Gross Domestic Product, the broadest measure of economic output, grew by only 2.2 percent in the fourth quarter of last year, down from an earlier estimate of 2.6 percent and a sharp fall from earlier quarters.

This followed the announcement by the Labor Department on Thursday that consumer prices fell by 0.7 percent, the largest fall since December 2008. Over the past 12 months, prices have fallen by 0.1 percent, the first annual deflation figure posted since October 2009.

These figures belie official claims that the US is an economically healthy counterbalance to the overall slump and deflation that now encompasses most of the world. In fact, US economic growth, hampered by an enormous impoverishment of the working class in the years following the financial crisis, remains far below previous historical averages.

On Tuesday, Standard and Poor’s said that its Case-Shiller Index showed that home prices grew by 4.6 percent over the past year, the slowest housing price increase since 2011. “The housing recovery is faltering,” David Blitzer, chairman of the index committee at S&P Dow Jones, told the Los Angeles Times. “Before the recession, anytime housing starts were at their current level… the economy was in a recession.”

Meanwhile the number of people in the US newly filing for jobless benefits jumped by 31,000 to 313,000 last week, in the largest increase since December 2013, reflecting a series of mass layoffs and business closures announced this month.

On February 4, office supply retailer Staples announced plans to buy its rival Office Depot, which would result in the closure of up to a thousand stores and tens of thousands of layoffs. The next day, electronics retailer RadioShack filed for bankruptcy, saying it plans to close up to 3,500 stores.

Mass layoffs have also been announced at online marketplace eBay, credit card company American Express, the oilfield services companies Schlumberger and Baker Hughes, as well as the retailers J.C. Penney and Macy’s.

These disastrous economic developments come even as the Dow Jones Industrial Average hit an all-time record of 18,140 on Wednesday, though it retreated slightly later in the week. Worldwide, the FTSE All-World Index is near its highest level in history.

The rise in global stock indices reflects the satisfaction of global financial markets with the pledge by the Syriza-led Greek government to impose austerity measures dictated by the EU, as well as indications by Federal Reserve Chairwoman Janet Yellen in congressional testimony this week that the US central bank is likely to delay raising the federal funds rate in response to recent negative economic figures.

The US federal funds rate has been at essentially zero since the beginning of 2009. Together with the central bank’s multi-trillion-dollar “quantitative easing” program, this has helped to inflate a massive stock market bubble that has seen the NASDAQ triple in value since 2009.

This enormous growth in asset values has taken place despite the relatively depressed state of the US economy, which grew at an annual rate of 2.4 percent in 2014. During the entire economic “recovery” since 2010, the US economy has grown at an average rate of 2.2 percent. By comparison, the US economy grew at an average rate of 3.2 percent in the 1990s and 4.2 percent in the 1950s.

The ongoing stock market bubble has led to a vast enrichment of the financial elite: the number of billionaires in the US has nearly doubled since 2009. The financial oligarchy, however, has not used its ever-growing wealth for productive investment, as shown by the decline in business spending in the fourth quarter of last year. Instead, it has either hoarded it or used it to buy real estate, art and luxury goods.

On Thursday, Bloomberg reported that global sales of “ultra-premium” vehicles, costing $100,000 or more, surged by 154 percent, compared with a 36 percent increase in global vehicle sales overall. The report noted, “Rolls-Royce registrations have risen almost five-fold. Almost 10,000 new Bentleys cruised onto the streets last year, a 122 percent increase over 2009, while Lamborghini rode a 50 percent increase to pass the 2,000 vehicle mark.”

Meanwhile, the number of people in poverty in the US remains at record levels. In January, the Southern Education Foundation reported that, for the first time in at least half a century, low-income children make up the majority of students enrolled in American public schools.

To the extent that jobs are being created in the US, they are largely part-time, contingent and low-wage, replacing higher-wage jobs eliminated during the 2008 crash. A report published last year by the National Employment Law Project found that while American companies have added 1.85 million low-wage jobs since 2009, they have eliminated 1.83 million medium-wage and high-wage jobs.

Earlier this month, Jim Clifton, head of the Gallup polling agency, denounced claims that the US unemployment rate has returned to “normal” levels. “There’s no other way to say this,” he wrote. “The official unemployment rate, which cruelly overlooks the suffering of the long-term and often permanently unemployed as well as the depressingly underemployed, amounts to a Big Lie.”

“Gallup defines a good job as 30+ hours per week for an organization that provides a regular paycheck. Right now, the US is delivering at a staggeringly low rate of 44%, which is the number of full-time jobs as a percent of the adult population, 18 years and older.”

Clifton added, “I hear all the time that ‘unemployment is greatly reduced, but the people aren’t feeling it.’ When the media, talking heads, the White House and Wall Street start reporting the truth—the percent of Americans in good jobs; jobs that are full time and real—then we will quit wondering why Americans aren’t ‘feeling’ something that doesn’t remotely reflect the reality in their lives.”

 

http://www.wsws.org/en/articles/2015/02/28/econ-f28.html

Google has captured your mind

Searches reveal who we are and how we think. True intellectual privacy requires safeguarding these records

Google has captured your mind
(Credit: Kuzma via iStock/Salon)

The Justice Department’s subpoena was straightforward enough. It directed Google to disclose to the U.S. government every search query that had been entered into its search engine for a two-month period, and to disclose every Internet address that could be accessed from the search engine. Google refused to comply. And so on Wednesday January 18, 2006, the Department of Justice filed a court motion in California, seeking an order that would force Google to comply with a similar request—a random sample of a million URLs from its search engine database, along with the text of every “search string entered onto Google’s search engine over a one-week period.” The Justice Department was interested in how many Internet users were looking for pornography, and it thought that analyzing the search queries of ordinary Internet users was the best way to figure this out. Google, which had a 45-percent market share at the time, was not the only search engine to receive the subpoena. The Justice Department also requested search records from AOL, Yahoo!, and Microsoft. Only Google declined the initial request and opposed it, which is the only reason we are aware that the secret request was ever made in the first place.

The government’s request for massive amounts of search history from ordinary users requires some explanation. It has to do with the federal government’s interest in online pornography, which has a long history, at least in Internet time. In 1995 Time Magazine ran its famous “Cyberporn” cover, depicting a shocked young boy staring into a computer monitor, his eyes wide, his mouth agape, and his skin illuminated by the eerie glow of the screen. The cover was part of a national panic about online pornography, to which Congress responded by passing the federal Communications Decency Act (CDA) the following year. This infamous law prevented all websites from publishing “patently offensive” content without first verifying the age and identity of its readers, and the sending of indecent communications to anyone under eighteen. It tried to transform the Internet into a public space that was always fit for children by default.


The CDA prompted massive protests (and litigation) charging the government with censorship. The Supreme Court agreed in the landmark case of Reno v. ACLU (1997), which struck down the CDA’s decency provisions. In his opinion for the Court, Justice John Paul Stevens explained that regulating the content of Internet expression is no different from regulating the content of newspapers.The case is arguably the most significant free speech decision over the past half century since it expanded the full protection of the First Amendment to Internet expression, rather than treating the Internet like television or radio, whose content may be regulated more extensively. In language that might sound dated, Justice Stevens announced a principle that has endured: “Through the use of chat rooms, any person with a phone line can become a town crier with a voice that resonates farther than it could from any soapbox. Through the use of web pages, mail exploders, and newsgroups, the same individual can become a pamphleteer.” The Internet, in other words, was now an essential forum for free speech.

In the aftermath of Reno, Congress gave up on policing Internet indecency, but continued to focus on child protection. In 1998 it passed the Children’s Online Protection Act, also known as COPA. COPA punished those who engaged in web communications made “for commercial purposes” that were accessible and “harmful to minors” with a $50,000 fine and prison terms of up to six months. After extensive litigation, the Supreme Court in Ashcroft v. ACLU (2004) upheld a preliminary injunction preventing the government from enforcing the law. The Court reasoned that the government hadn’t proved that an outright ban of “harmful to minors” material was necessary. It suggested that Congress could have instead required the use of blocking or filtering software, which would have had less of an impact on free speech than a ban, and it remanded the case for further proceedings. Back in the lower court, the government wanted to create a study showing that filtering would be ineffective, which is why it wanted the search queries from Google and the other search engine companies in 2006.

Judge James Ware ruled on the subpoena on March 17, 2006, and denied most of the government’s demands. He granted the release of only 5 percent of the requested randomly selected anonymous search results and none of the actual search queries. Much of the reason for approving only a tiny sample of the de-identified search requests had to do with privacy. Google had not made a direct privacy argument, on the grounds that de-identified search queries were not “personal information,” but it argued that disclosure of the records would expose its trade secrets and harm its goodwill from users who believed that their searches were confidential. Judge Ware accepted this oddly phrased privacy claim, and added one of his own that Google had missed. The judge explained that Google users have a privacy interest in the confidentiality of their searches because a user’s identity could be reconstructed from their queries and because disclosure of such queries could lead to embarrassment (searches for, e.g., pornography or abortions) or criminal liability (searches for, e.g., “bomb placement white house”). He also placed the list of disclosed website addresses under a protective order to safeguard Google’s trade secrets.

Two facets of Judge Ware’s short opinion in the “Search Subpoena Case” are noteworthy. First, the judge was quite correct that even search requests that have had their user’s identities removed are not anonymous, as it is surprisingly easy to re-identify this kind of data. The queries we enter into search engines like Google often unwittingly reveal our identities. Most commonly, we search our own names, out of vanity, curiosity, or to discover if there are false or embarrassing facts or images of us online. But other parts of our searches can reveal our identities as well. A few months after the Search Subpoena Case, AOL made public twenty million search queries from 650,000 users of its search engine users. AOL was hoping this disclosure would help researchers and had replaced its users’ names with numerical IDs to protect their privacy. But two New York Times reporters showed just how easy it could be to re-identify them. They tracked down AOL user number 4417749 and identified her as Thelma Arnold, a sixty-two-year old widow in Lilburn, Georgia. Thelma had made hundreds of searches including “numb fingers,” “60 single men,” and “dog that urinates on everything.” The New York Times reporters used old-fashioned investigative techniques, but modern sophisticated computer science tools make re-identification of such information even easier. One such technique allowed computer scientists to re-identify users in the Netflix movie-watching database, which that company made public to researchers in 2006.

The second interesting facet of the Search Subpoena Case is its theory of privacy. Google won because the disclosure threatened its trade secrets (a commercial privacy, of sorts) and its business goodwill (which relied on its users believing that their searches were private). Judge Ware suggested that a more direct kind of user privacy was at stake, but was not specific beyond some generalized fear of embarrassment (echoing the old theory of tort privacy) or criminal prosecution (evoking the “reasonable expectation of privacy” theme from criminal law). Most people no doubt have an intuitive sense that their Internet searches are “private,” but neither our intuitions nor the Search Subpoena Case tell us why. This is a common problem in discussions of privacy. We often use the word “privacy” without being clear about what we mean or why it matters. We can do better.

Internet searches implicate our intellectual privacy. We use tools like Google Search to make sense of the world, and intellectual privacy is needed when we are making sense of the world. Our curiosity is essential, and it should be unfettered. As I’ll show in this chapter, search queries implicate a special kind of intellectual privacy, which is the freedom of thought.

Freedom of thought and belief is the core of our intellectual privacy. This freedom is the defining characteristic of a free society and our most cherished civil liberty. This right encompasses the range of thoughts and beliefs that a person might hold or develop, dealing with matters that are trivial and important, secular and profane. And it protects the individual’s thoughts from scrutiny or coercion by anyone, whether a government official or a private actor such as an employer, a friend, or a spouse. At the level of law, if there is any constitutional right that is absolute, it is this one, which is the precondition for other political and religious rights guaranteed by the Western tradition. Yet curiously, although freedom of thought is widely regarded as our most important civil liberty, it has not been protected in our law as much as other rights, in part because it has been very difficult for the state or others to monitor thoughts and beliefs even if they wanted to.

Freedom of Thought and Intellectual Privacy

In 1913 the eminent Anglo-Irish historian J. B. Bury published A History of Freedom of Thought, in which he surveyed the importance of freedom of thought in the Western tradition, from the ancient Greeks to the twentieth century. According to Bury, the conclusion that individuals should have an absolute right to their beliefs free of state or other forms of coercion “is the most important ever reached by men.” Bury was not the only scholar to have observed that freedom of thought (or belief, or conscience) is at the core of Western civil liberties. Recognitions of this sort are commonplace and have been made by many of our greatest minds. René Descartes’s maxim, “I think, therefore I am,” identifies the power of individual thought at the core of our existence. John Milton praised in Areopagitica “the liberty to know, to utter, and to argue freely according to conscience, above all [other] liberties.”

In the nineteenth century, John Stuart Mill developed a broad notion of freedom of thought as an essential element of his theory of human liberty, which comprised “the inward domain of consciousness; demanding liberty of conscience, in the most comprehensive sense; liberty of thought and feeling; absolute freedom of opinion and sentiment on all subjects, practical or speculative, scientific, moral, or theological.” In Mill’s view, free thought was inextricably linked to and mutually dependent upon free speech, with the two concepts being a part of a broader idea of political liberty. Moreover, Mill recognized that private parties as well as the state could chill free expression and thought.

Law in Britain and America has embraced the central importance of free thought as the civil liberty on which all others depend. But it was not always so. People who cannot think for themselves, after all, are incapable of self-government. In the Middle Ages, the crime of “constructive treason” outlawed “imagining the death of the king” as a crime that was punishable by death. Thomas Jefferson later reflected that this crime “had drawn the Blood of the best and honestest Men in the Kingdom.” The impulse for political uniformity was related to the impulse for religious uniformity, whose story is one of martyrdom and burnings of the stake. As Supreme Court Justice William O. Douglas put it in 1963:

While kings were fearful of treason, theologians were bent on stamping out heresy. . . . The Reformation is associated with Martin Luther. But prior to him it broke out many times only to be crushed. When in time the Protestants gained control, they tried to crush the Catholics; and when the Catholics gained the upper hand, they ferreted out the Protestants. Many devices were used. Heretical books were destroyed and heretics were burned at the stake or banished. The rack, the thumbscrew, the wheel on which men were stretched, these were part of the paraphernalia.

Thankfully, the excesses of such a dangerous government power were recognized over the centuries, and thought crimes were abolished. Thus, William Blackstone’s influential Commentaries stressed the importance of the common law protection for the freedom of thought and inquiry, even under a system that allowed subsequent punishment for seditious and other kinds of dangerous speech. Blackstone explained that:

Neither is any restraint hereby laid upon freedom of thought or inquiry: liberty of private sentiment is still left; the disseminating, or making public, of bad sentiments, destructive of the ends of society, is the crime which society corrects. A man (says a fine writer on this subject) may be allowed to keep poisons in his closet, but not publicly to vend them as cordials.

Even during a time when English law allowed civil and criminal punishment for many kinds of speech that would be protected today, including blasphemy, obscenity, seditious libel, and vocal criticism of the government, jurists recognized the importance of free thought and gave it special, separate protection in both the legal and cultural traditions.

The poisons metaphor Blackstone used, for example, was adapted from Jonathan Swift’s Gulliver’s Travels, from a line that the King of Brobdingnag delivers to Gulliver. Blackstone’s treatment of freedom of thought was itself adopted by Joseph Story in his own Commentaries, the leading American treatise on constitutional law in the early Republic. Thomas Jefferson and James Madison also embraced freedom of thought. Jefferson’s famous Virginia Statute for Religious Freedom enshrined religious liberty around the declaration that “Almighty God hath created the mind free,” and James Madison forcefully called for freedom of thought and conscience in his Memorial and Remonstrance Against Religious Assessments.

Freedom of thought thus came to be protected directly as a prohibition on state coercion of truth or belief. It was one of a handful of rights protected by the original Constitution even before the ratification of the Bill of Rights. Article VI provides that “state and federal legislators, as well as officers of the United States, shall be bound by oath or affirmation, to support this Constitution; but no religious test shall ever be required as a qualification to any office or public trust under the United States.” This provision, known as the “religious test clause,” ensured that religious orthodoxy could not be imposed as a requirement for governance, a further protection of the freedom of thought (or, in this case, its closely related cousin, the freedom of conscience). The Constitution also gives special protection against the crime of treason, by defining it to exclude thought crimes and providing special evidentiary protections:

Treason against the United States, shall consist only in levying war against them, or in adhering to their enemies, giving them aid and comfort. No person shall be convicted of treason unless on the testimony of two witnesses to the same overt act, or on confession in open court.

By eliminating religious tests and by defining the crime of treason as one of guilty actions rather than merely guilty minds, the Constitution was thus steadfastly part of the tradition giving exceptional protection to the freedom of thought.

Nevertheless, even when governments could not directly coerce the uniformity of beliefs, a person’s thoughts remained relevant to both law and social control. A person’s thoughts could reveal political or religious disloyalty, or they could be relevant to a defendant’s mental state in committing a crime or other legal wrong. And while thoughts could not be revealed directly, they could be discovered by indirect means. For example, thoughts could be inferred either from a person’s testimony or confessions, or by access to their papers and diaries. But both the English common law and the American Bill of Rights came to protect against these intrusions into the freedom of the mind as well.

The most direct way to obtain knowledge about a person’s thoughts would be to haul him before a magistrate as a witness and ask him under penalty of law. The English ecclesiastical courts used the “oath ex officio” for precisely this purpose. But as historian Leonard Levy has explained, this practice came under assault in Britain as invading the freedom of thought and belief. As the eminent jurist Lord Coke later declared, “no free man should be compelled to answer for his secret thoughts and opinions.” The practice of the oath was ultimately abolished in England in the cases of John Lilburne and John Entick, men who were political dissidents rather than religious heretics.

In the new United States, the Fifth Amendment guarantee that “No person . . . shall be compelled in any criminal case to be a witness against himself ” can also be seen as a resounding rejection of this sort of practice in favor of the freedom of thought. Law of course evolves, and current Fifth Amendment doctrine focuses on the consequences of a confession rather than on mental privacy, but the origins of the Fifth Amendment are part of a broad commitment to freedom of thought that runs through our law. The late criminal law scholar William Stuntz has shown that this tradition was not merely a procedural protection for all, but a substantive limitation on the power of the state to force its enemies to reveal their unpopular or heretical thoughts. As he put the point colorfully, “[i]t is no coincidence that the privilege’s origins read like a catalogue of religious and political persecution.”

Another way to obtain a person’s thoughts would be by reading their diaries or other papers. Consider the Fourth Amendment, which protects a person from unreasonable searches and seizures by the police:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Today we think about the Fourth Amendment as providing protection for the home and the person chiefly against unreasonable searches for contraband like guns or drugs. But the Fourth Amendment’s origins come not from drug cases but as a bulwark against intellectual surveillance by the state. In the eighteenth century, the English Crown had sought to quash political and religious dissent through the use of “general warrants,” legal documents that gave agents of the Crown the authority to search the homes of suspected dissidents for incriminating papers.

Perhaps the most infamous dissident of the time was John Wilkes. Wilkes was a progressive critic of Crown policy and a political rogue whose public tribulations, wit, and famed personal ugliness made him a celebrity throughout the English-speaking world. Wilkes was the editor of a progressive newspaper, the North Briton, a member of Parliament, and an outspoken critic of government policy. He was deeply critical of the 1763 Treaty of Paris ending the Seven Years War with France, a conflict known in North America as the French and Indian War. Wilkes’s damning articles angered King George, who ordered the arrest of Wilkes and his co-publishers of the North Briton, authorizing general warrants to search their papers for evidence of treason and sedition. The government ransacked numerous private homes and printers’ shops, scrutinizing personal papers for any signs of incriminating evidence. In all, forty-nine people were arrested, and Wilkes himself was charged with seditious libel, prompting a long and inconclusive legal battle of suits and countersuits.

By taking a stand against the king and intrusive searches, Wilkes became a cause célèbre among Britons at home and in the colonies. This was particularly true for many American colonists, whose own objections to British tax policy following the Treaty of Paris culminated in the American Revolution. The rebellious colonists drew from the Wilkes case the importance of political dissent as well as the need to protect dissenting citizens from unreasonable (and politically motivated) searches and seizures.

The Fourth Amendment was intended to address this problem by inscribing legal protection for “persons, houses, papers, and effects” into the Bill of Rights. A government that could not search the homes and read the papers of its citizens would be less able to engage in intellectual tyranny and enforce intellectual orthodoxy. In a pre-electronic world, the Fourth Amendment kept out the state, while trespass and other property laws kept private parties out of our homes, paper, and effects.

The Fourth and Fifth Amendments thus protect the freedom of thought at their core. As Stuntz explains, the early English cases estab- lishing these principles were “classic First Amendment cases in a system with no First Amendment.” Even in a legal regime without protection for dissidents who expressed unpopular political or religious opinions, the English system protected those dissidents in their private beliefs, as well as the papers and other documents that might reveal those beliefs.

In American law, an even stronger protection for freedom of thought can be found in the First Amendment. Although the First Amendment text speaks of free speech, press, and assembly, the freedom of thought is unquestionably at the core of these guarantees, and courts and scholars have consistently recognized this fact. In fact, the freedom of thought and belief is the closest thing to an absolute right guaranteed by the Constitution. The Supreme Court first recognized it in the 1878 Mormon polygamy case of Reynolds v. United States, which ruled that although law could regulate religiously inspired actions such as polygamy, it was powerless to control “mere religious belief and opinions.” Freedom of thought in secular matters was identified by Justices Holmes and Brandeis as part of their dissenting tradition in free speech cases in the 1910s and 1920s. Holmes declared crisply in United States v. Schwimmer that “if there is any principle of the Constitution that more imperatively calls for attachment than any other it is the principle of free thought—not free thought for those who agree with us but freedom for the thought that we hate.” And in his dissent in the Fourth Amendment wiretapping case of Olmstead v. United States, Brandeis argued that the framers of the Constitution “sought to protect Americans in their beliefs, their thoughts, their emotions and their sensations.” Brandeis’s dissent in Olmstead adapted his theory of tort privacy into federal constitutional law around the principle of freedom of thought.

Freedom of thought became permanently enshrined in constitutional law during a series of mid-twentieth century cases that charted the contours of the modern First Amendment. In Palko v. Connecticut, Justice Cardozo characterized freedom of thought as “the matrix, the indispensable condition, of nearly every other form of freedom.” And in a series of cases involving Jehovah’s Witnesses, the Court developed a theory of the First Amendment under which the rights of free thought, speech, press, and exercise of religion were placed in a “preferred position.” Freedom of thought was central to this new theory of the First Amendment, exemplified by Justice Jackson’s opinion in West Virginia State Board of Education v. Barnette, which invalidated a state regulation requiring that public school children salute the flag each morning. Jackson declared that:

If there is any fixed star in our constitutional constellation, it is that no official, high or petty, can prescribe what shall be orthodox in politics, nationalism, religion, or other matters of opinion or force citizens to confess by word or act their faith therein. . . .

[The flag-salute statute] transcends constitutional limitations on [legislative] power and invades the sphere of intellect and spirit which it is the purpose of the First Amendment to our Constitution to reserve from all official control.

Modern cases continue to reflect this legacy. The Court has repeatedly declared that the constitutional guarantee of freedom of thought is at the foundation of what it means to have a free society. In particular, freedom of thought has been invoked as a principal justification for preventing punishment based upon possessing or reading dangerous media. Thus, the government cannot punish a person for merely possessing unpopular or dangerous books or images based upon their content. As Alexander Meiklejohn put it succinctly, the First Amendment protects, first and foremost, “the thinking process of the community.”

Freedom of thought thus remains, as it has for centuries, the foundation of the Anglo-American tradition of civil liberties. It is also the core of intellectual privacy.

“The New Home of Mind”

“Governments of the Industrial World, you weary giants of flesh and steel, I come from Cyberspace, the new home of Mind.” So began “A Declaration of Independence of Cyberspace,” a 1996 manifesto responding to the Communications Decency Act and other attempts by government to regulate the online world and stamp out indecency. The Declaration’s author was John Perry Barlow, a founder of the influential Electronic Frontier Foundation and a former lyricist for the Grateful Dead. Barlow argued that “[c]yberspace consists of transactions, relationships, and thought itself, arrayed like a standing wave in the web of our communications. Ours is a world that is both everywhere and nowhere, but it is not where bodies live.” This definition of the Internet as a realm of pure thought was quickly followed by an affirmation of the importance of the freedom of thought. Barlow insisted that in Cyberspace “anyone, anywhere may express his or her beliefs, no matter how singular, without fear of being coerced into silence or conformity.” The Declaration concluded on the same theme: “We will spread ourselves across the Planet so that no one can arrest our thoughts. We will create a civilization of the Mind in Cyberspace. May it be more humane and fair than the world your governments have made before.”

In his Declaration, Barlow joined a tradition of many (including many of the most important thinkers and creators of the digital world) who have expressed the idea that networked computing can be a place of “thought itself.” As early as 1960, the great computing visionary J. C. R. Licklider imagined that “in not too many years, human brains and computing machines will be coupled together very tightly, and that the resulting partnership will think as no human brain has ever thought.” Tim Berners-Lee, the architect of the World Wide Web, envisioned his creation as one that would bring “the workings of society closer to the workings of our minds.”

Barlow’s utopian demand that governments leave the electronic realm alone was only partially successful. The Communications Decency Act was, as we have seen, struck down by the Supreme Court, but today many laws regulate the Internet, such as the U.S. Digital Millenium Copyright Act6and the EU Data Retention Directive. The Internet has become more (and less) than Barlow’s utopian vision—a place of business as well as of thinking. But Barlow’s description of the Internet as a world of the mind remains resonant today.

It is undeniable that today millions of people use computers as aids to their thinking. In the digital age, computers are an essential and intertwined supplement to our thoughts and our memories. Discussing Licklider’s prophesy from half a century ago, legal scholar Tim Wu notes that virtually every computer “program we use is a type of thinking aid—whether the task is to remember things (an address book), to organize prose (a word processor), or to keep track of friends (social network software).” These technologies have become not just aids to thought but also part of the thinking process itself. In the past, we invented paper and books, and then sound and video recordings to preserve knowledge and make it easier for us as individuals and societies to remember information. Digital technologies have made remembering even easier, by providing cheap storage, inexpensive retrieval, and global reach. Consider the Kindle, a cheap electronic reader that can hold 1,100 books, or even cheaper external hard drives that can hold hundreds of hours of high-definition video in a box the size of a paperback novel.

Even the words we use to describe our digital products and experiences reflect our understanding that computers and cyberspace are devices and places of the mind. IBM has famously called its laptops “ThinkPads,” and many of us use “smartphones.” Other technologies have been named in ways that affirm their status as tools of the mind—notebooks, ultrabooks, tablets, and browsers. Apple Computer produces iPads and MacBooks and has long sold its products under the slogan, “Think Different.” Google historian John Battelle has famously termed Google’s search records to be a “database of intentions.” Google’s own slogan for its web browser Chrome is “browse the web as fast as you think,” revealing how web browsing itself is not just a form of reading, but a kind of thinking itself. My point here is not just that common usage or marketing slogans connect Internet use to thinking, but a more important one: Our use of these words reflects a reality. We are increasingly using digital technologies not just as aids to our memories but also as an essential part of the ways we think.

Search engines in particular bear a special connection to the processes of thought. How many of us have asked a factual question among friends, only for smartphones to appear as our friends race to see who can look up the answer the fastest? In private, we use search engines to learn about the world. If you have a moment, pull up your own search history on your phone, tablet, or computer, and recall your past queries. It usually makes for interesting reading—a history of your thoughts and wonderings.

But the ease with which we can pull up such a transcript reveals another fundamental feature of digital technologies—they are designed to create records of their use. Think again about the profile a search engine like Google has for you. A transcript of search queries and links followed is a close approximation to a transcript of the operation of your mind. In the logs of search engine companies are vast repositories of intellectual wonderings, questions asked, and mental whims followed. Similar logs exist for Internet service providers and other new technology companies. And the data contained in such logs is eagerly sought by government and private entities interested in monitoring intellectual activity, whether for behavioral advertising, crime and terrorism prevention, and possibly other, more sinister purposes.

Searching Is Thinking

With these two points in mind—the importance of freedom of thought and the idea of the Internet as a place where thought occurs—we can now return to the Google Search Subpoena with which this chapter opened. Judge Ware’s opinion revealed an intuitive understanding that the disclosure of search records was threatening to privacy, but was not clear about what kind of privacy was involved or why it matters.

Intellectual privacy, in particular the freedom of thought, supplies the answer to this problem. We use search engines to learn about and make sense of the world, to answer our questions, and as aids to our thinking. Searching, then, in a very real sense is a kind of thinking. And we have a long tradition of protecting the privacy and confidentiality of our thoughts from the scrutiny of others. It is precisely because of the importance of search records to human thought that the Justice Department wanted to access the records. But if our search records were more public, we wouldn’t merely be exposed to embarrassment like Thelma Arnold of Lilburn, Georgia. We would be less likely to search for unpopular or deviant or dangerous topics. Yet in a free society, we need to be able to think freely about any ideas, no matter how dangerous or unpopular. If we care about freedom of thought—and our political institutions are built on the assumption that we do—we should care about the privacy of electronic records that reveal our thoughts. Search records illustrate the point well, but this idea is not just limited to that one important technology. My argument about freedom of thought in the digital age is this: Any technology that we use in our thinking implicates our intellectual privacy, and if we want to preserve our ability to think fearlessly, free of monitoring, interference, or repercussion, we should embody these technologies with a meaningful measure of intellectual privacy.

Excerpted from “Intellectual Privacy: Rethinking Civil Liberties in the Digital Age” by Neil Richards. Published by Oxford University Press. Copyright 2015 by Neil Richards. Reprinted with permission of the publisher. All rights reserved.

Neil Richards is a Professor of Law at Washington University, where he teaches and writes about privacy, free speech, and the digital revolution.

Ending austerity in Greece: time for plan B?

By Jerome Roos On February 26, 2015

Post image for Ending austerity in Greece: time for plan B?Syriza’s “head-long retreat” in the standoff with its creditors hails the failure of Tsipras’ pro-euro strategy. It’s time to start preparing for Grexit.

Photo by Angelos Tzortzinis.

When the Eurogroup accepted Greece’s reform proposals on Tuesday, investors and EU leaders let out a collective sigh of relief: it appears that the bombshell of a disorderly Greek exit from the Eurozone has been diffused, at least until the start of the summer. In return for a significant roll-back of its campaign pledges, Greece’s freshly inaugurated government secured a four-month extension of its current bailout program and thereby managed to avert a potentially catastrophic bank run that would likely have resulted in Grexit.

But while Greece’s creditors seemed content, the agreement immediately unleashed a bitter debate within the governing leftist party Syriza. Prime Minister Tsipras may have declared a tentative victory for his anti-austerity coalition, but some influential party members strongly criticized what they perceived to be an unacceptable climbdown. Costas Lapavitsas, the SOAS economist and Syriza MP, wrote a scathing letter expressing his serious concerns about the government’s ability to stick to its promises, while Stathis Kouvelakis of Syriza’s central committee dubbed the agreement a “head-long retreat.”

Manolis Glezos, the 94-year-old war hero and Syriza MEP, even went so far as toapologize to the Greek people for having participated in “this illusion,” while the legendary composer Mikis Theodorakis urged the government to resist the “fatal embrace” of its creditors. Paul Mason reports that “there is a sea change going on within Syriza. In the past 48 hours I’ve heard people who were staunch believers in the ‘good euro’ — a euro that can accommodate by negotiation a radical left government — say, effectively, they were wrong.”

How are we to respond to all this? The first thing to observe is Spinoza’s dictum:non ridere, non lugere, neque detestari, sed intelligere — not to ridicule, lament or condemn, but to understand. If we really want to understand Syriza’s rapid retreat over the past week and engage in constructive criticism to end austerity, we’ll have to start, first of all, with the strategy chosen by its party leadership, particularly in relation to the euro; and secondly with the way in which the single currency serves as an amplifier of structural power relations between creditors and debtors — core and periphery — in the European political economy.

On the first point, it is clear that the so-called “good euro” strategy proposed by the party leadership and Finance Minister Yanis Varoufakis, whose “modest proposal” for resolving the crisis fundamentally revolves around a wholesale restructuring of the Eurozone along Keynesian lines, has run headlong into the opposition of virtually everyone else involved. In the negotiations, Greece found itself isolated not only by the 18 other Eurozone finance ministers (including the center-left French and Italians and the other heavily indebted countries), but also by the ECB and the European Commission.

Moreover, going into the negotiations, Greece suffered from two structural weaknesses: the near-total depletion of its public finances and the extremely parlous state of its domestic banking system. With its reserves running on empty, the government would have run out of financing by February 24 and would have been forced to default on its IMF obligations by March. At the same time, increasing uncertainty about Greece’s place in the Eurozone produced sustained deposit flight, bringing the Greek banks to the brink of collapse.

Strategically speaking, the government could have wielded these weaknesses as a bargaining chip. Had it been willing to put its euro membership on the line, Greece might have been able to extract greater concessions from its risk-averse “partners” by threatening unilateral action if the creditors refused to give in. But default and Grexit were ruled out a priori by Syriza’s moderate leadership, which repeatedly declared its unwavering commitment to the single currency. Knowing this, Germany and its allies pushed for total surrender: with Greece weak and dependent on external loans, the Eurozone could enforce strict conditions in return for continued membership.

This first observation is connected to the second point: the highly asymmetric power relations at the heart of the monetary union. In previous columns, I have repeatedly argued that Germany — as the dominant force inside the Eurozone — would never accept a restructuring of the Greek debt, that the Eurozone wouldnever accommodate a social democratic alternative in its midst, and that as a result Greece’s leftist government would find it impossible to pursue a socially progressive alternative (let alone a radical program) inside the fundamentally regressive, anti-social and anti-democratic straitjacket of the Eurozone.

These predictions — which are very similar to those made by Costas Lapavitsasand others inside Syriza’s Left Platform — have now been proven correct. Continued Eurozone membership keeps Greece stuck within a web of structural constraints from which it cannot escape without its creditors’ approval. And since these creditors are loathe to set a precedent of successful debtor defiance, they will do anything to prevent Greece from upending the neoliberal austerity doctrine. There can be only one conclusion from this: to truly end austerity, Greece will have to leave the euro.

To be sure, Grexit is not a panacea. Readjustment will be extremely painful in the short term, and even in the long-run it is clear that restoring fiscal and monetary policy autonomy will never be enough to overcome the structural dependence of the Greek economy on foreign investment or to insulate the Greek state from the systemic pressures of global finance. The point of Grexit, however, is not to fetishize national sovereignty but simply to reclaim the essential monetary and fiscal policy tools that the government now lacks — and without which it is materially impossible to determine socioeconomic priorities and pursue a progressive economic program.

The most important challenge, in this respect, will not necessarily be economic in nature but rather social, political and psychological. Before Greece can ever be liberated from its state of debt servitude and its plight of permanent austerity, its government will first need to be in a position to default on its European creditors and “print” its own currency. This will in turn require three things:

First, mass mobilization from below will be essential, both to put pressure on Syriza’s leadership and to empower the pro-Grexit faction inside the party, which is now steadily growing in the wake of last week’s dramatic retreat. Second, voters will have to abandon their aversion towards Grexit and public opinion will have to sway behind a much more confrontational approach. To get there, the left and the movements will have to embark on a concerted campaign of “popular education” to inform the Greek public of the only real options available to their country: progressive exit or endless austerity.

Finally, and most importantly, the government would have to be meticulously prepared to manage the extremely difficult transition period, in which the price of imported goods will skyrocket following a sharp devaluation; key commodities like food, petroleum and medicine will have to be rationed to deal with sudden scarcity; capital controls and border controls will have to be reintroduced to prevent catastrophic capital flight; deposits and loan contracts will need to be re-denominated into drachma; and the banks will have to be nationalized to prevent a complete collapse of the financial system.

All of this will require a degree of radicalization and preparation that currently seems both utterly irresponsible and completely unrealistic. Yet this is precisely where the brutally anti-democratic methods of the Eurozone are pushing Greece today. For five years, Greeks have been living in total despair. Desperate times call for desperate measures — and the time for unilateral default and Grexit may be approaching faster than most people are willing or able to recognize. If the left truly cares about ending austerity, it should start preparing for Plan B.

Jerome Roos is a PhD researcher in International Political Economy at the European University Institute and founding editor of ROAR Magazine. Follow him on Twitter @JeromeRoos. This article was written for TeleSUR English.

 

http://roarmag.org/2015/02/greece-austerity-euro-exit/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+roarmag+%28ROAR+Magazine%29

Record global stock prices reflect growth of financial parasitism

stock-market-down

By Nick Beams
27 February 2015

This week has seen global stock prices approach record highs under conditions where the German government took the unprecedented step of issuing bonds at a negative yield. The two interrelated developments point to an explosive growth of financial parasitism.

World equity markets are close to their highest levels in history, as measured by the FTSE All-World Index. The FTSE 100, Britain’s index of leading shares, surpassed its previous high, achieved at the end of 1999 on the eve of the bursting of the dot.com share market bubble, to join Wall Street’s Dow and the German DAX in record territory.

This is an extraordinary phenomenon given that large areas of the global economy, most notably Europe and Japan, are either stagnant or in recession; China and the so-called “emerging markets,” which have been the main centre of global growth, are slowing down; and the much-vaunted US growth is still below historical trends.

All of the major reports on the state of the world economy in the recent period—from the World Bank, the International Monetary Fund, and the Organisation for Economic Cooperation and Development—have downgraded previous growth projections and warned that the economy is increasingly characterised by a vicious cycle.

Investment has fallen to historic lows because of the lack of demand and profit opportunities. The decline in investment is leading, in turn, to a further decline in demand and profit expectations.

Notwithstanding these powerful trends, the stock markets continue to power on, providing a graphic demonstration of the degree to which the accumulation of wealth by global financial elites has become divorced from the actual process of production.

One of the main factors boosting Wall Street in recent days was the estimation, following the testimony by US Federal Reserve Chairwoman Janet Yellen to the US Congress, that the central bank was in no hurry to start lifting official interest rates, ensuring that the flow of cheap money into financial markets would continue.

European markets also took heart from Yellen’s remarks and were boosted as well by the approach of the European Central Bank’s money-printing “quantitative easing” (QE) program, slated to begin next week.

In addition, they were warmed by the news that the European Union and the financial oligarchy it represents had obtained the Syriza-led Greek government’s abject capitulation, including the renunciation of the pseudo-left party’s election promises to fight the EU’s austerity program. The Greek developments, ensuring the further impoverishment of the Greek working class, were a source of satisfaction not only because of their implications for Greece, but also for the message they sent across Europe that any demand for an end to austerity would meet the same fate.

The emergence of negative bond yields, underscored by the German government’s issuance of five-year notes at a negative rate, signifies that the bond market is being transformed into a gigantic Ponzi scheme, in which the ability to make money depends on the continuous flow of new cash—largely emanating from central banks—into the financial system. It is increasingly operating according to the “bigger fool” principle. While it may be considered foolish to invest in a high-priced bond that offers a negative yield, speculators bet that there is an even bigger fool who will buy the bond when its price rises even further.

When negative yields first made their appearance, it was thought they were a transitory phenomenon, the result of the search for a “safe haven” for cash. But now they are becoming a permanent feature of the financial landscape.

Besides Germany, five-year bonds issued by Denmark, Finland, the Netherlands and Austria, as well as corporate bonds issued by Nestlé and Shell, have come with negative yields.

The immediate impetus for the growth in negative yields is the decision by the European Central Bank to begin bond purchases from March 1 at the rate of €60 billion per month for at least the next 16 months.

Speaking to the Financial Times, Divyang Shah, a global strategist at IFR Markets, said: “It should not be ruled out that, once the ECB QE program begins, we will see German 10-year yields trade through zero and into negative territory.” Swiss 14-year bonds were already trading at negative yields, so such an outcome could not be ruled out, he said, adding that “instead of safe haven-related demand we have QE-related demand.”

The yield on the German 10-year bond yesterday touched a record low of 0.28 percent, with 10-year yields in France, Portugal and Spain also falling to record levels.

The truly explosive growth of financial parasitism, expressed in the negative yield phenomenon, is highlighted by data compiled by JPMorgan Chase. It estimates that in the past year alone the value of negative-yielding bonds in Europe has escalated exponentially—from $20 billion to $2 trillion, a hundred-fold increase. It is calculated that at least one-third of all European bonds now show negative yields. Nothing remotely resembling this has been seen in economic history.

One of its immediate effects is to destroy the financial modus operandi of pension funds and insurance companies. Throughout their history, they have invested in government debt in order to secure a steady and safe rate of return over the long term, often under legal requirements to do so. However, this strategy is increasingly unviable, and in order to meet their commitments, they are being forced to make riskier investments or join the bond market speculation.

The rise of financial parasitism has decisive economic and political implications. As the whole of economic history demonstrates, and the events of the past decade have again revealed, the maintenance of this house of cards cannot continue indefinitely.

A major bankruptcy, produced by a sudden shift in the value of one or another of the major currencies, for example, (such as took place earlier this year with the dramatic leap in the value of the Swiss franc), a corporate default, a sudden shift in sentiment due to an interest rate rise, or one of any number of seemingly accidental events can trigger a chain reaction that brings the entire rotten financial edifice crashing down.

Furthermore, because trillions of dollars have been injected into the financial system by central banks over the past six years, the consequences have the potential to be even more serious than those that followed the collapse of Lehman Brothers in September 2008.

The consequent closures, sackings and mass unemployment and the intensification of the assault on social services will fuel the eruption of social and political struggles that will be met with an immediate and ruthless response from the financial oligarchy. That is the lesson of Greece.

Acutely aware that they have no economic solution to the crisis of the profit system, the ruling elites in every country have spent the past six years boosting police and security forces to deal with the inevitable outbreak of mass struggles.

 

 

http://www.wsws.org/en/articles/2015/02/27/econ-f27.html

DIGITAL MUSIC NEWS

Global Decision: New Music Will Be

Released On Fridays, Starting This Summer

 

     After months of discussions and negotiation it appears every country will now adopt a standardized music launch day in an attempt to create “a sense of occasion around the release of new music.” That’s the word from IFPI, the worldwide body representing the recording industry, which this week said that sometime this summer  all new music will be released globally on Fridays.

“As well as helping music fans, the move will benefit artists who want to harness social media to promote their new music,” the IFPI said in a statement. “It also creates the opportunity to reignite excitement and a sense of occasion around the release of new music.” Currently, new music is released in the U.K. on Monday, with U.S. releases coming out on Tuesday. This new arrangement will see new albums and singles released at 00:01 am (local time) on Fridays. IFPI says the decision to standardize the release day came after thorough consultation with all parties who have an interest in recoded music.

“We’ve had a long consultation involving retailers, artists, and record labels, and we have looked at a large amount of insight and research,” IFPI CEO Frances Moore told Music Week. “The good news has been the widespread support we’ve seen around the world for global release day – no one has seriously questioned the concept. The only debate has been about the day. The artist organizations and many retailers and record companies internationally support Friday, and this is backed by consumer research in many countries.”

Still, many independent labels and artists appear to be dissatisfied with the idea of designating Friday – or any day – as “new music day.” And since there’s no law that forces companies to comply with this new agreement, look for some rogue players to defy the standard and release their singles and albums on any day they choose. 

Apple Reportedly Buys Camel Audio;

Plans For Tech Firm Remain Unclear

 

Apple      Apple Inc. reportedly has acquired U.K. music technology company Camel Audio – a company that, among other things, built the Alchemy software suite that allowed musicians to produce their own tracks digitally. While Apple has not officially acknowledged the acquisition, digital music blog MusicRadar says the deal closed in early January, around the time Apple attorney Heather Joy Morrison was named as the company’s sole director. Camel reportedly has shut down its operations, leaving behind a website containing only a user login page for contacting customer support, and miscellaneous legal information.

A notice on the website reads, in part: “We would like to thank you for the support we’ve received over the years in our efforts to create instruments, effects plug-ins, and sound libraries. Camel Audio’s plug-ins, Alchemy Mobile IAPs, and sound libraries are no longer available for purchase. We will continue to provide downloads of your previous purchases and email support until July 7, 2015. We recommend you download all of your purchases and back them up so that you can continue to use them.”

Thus far it’s unclear how the Camel Audio acquisition fits within Apple’s apparent plans to lead the digital music space. Apple already offers products for digital music production, including Garageband and Logic Pro X, and some sources believe Camel’s products will be folded into those existing products or perhaps into iTunes. The Silicon Valley giant has issued a vague statement noting that, “Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans.” The statement is typically offered when an acquisition rumor is legitimate, suggesting Apple did in fact purchase Camel Audio last month. [Read more: Apple Insider

Google Play Music Increases Its Music

Storage Capacity To 50,000 Songs

 

     In an attempt to thwart any attempt by Apple to grow its dominance in the digital music space, Google Play Music this week announced it has upgraded the storage space for registered users from 20,000 songs to 50,000 songs. The extra space is a free upgrade for users, and the expanded capacity is applied automatically for those who already host their music collection in Google’s cloud. Google Play Music is a music streaming and storage service that lets users listen on the web, smartphones, or tablets.

While many consumers are shifting to streaming services and away from downloaded digital files, many users have invested in building – and listening to – massive music libraries. Google’s offer to host even bigger collections is an attempt to lure those customers who are unwilling to give up their previous musical life in favor of streaming platforms.

Because of this single change many analysts say Google Play Music significantly has strengthened its competitive position against Spotify; a lack of storage for music and other media is considered one of the core issues still plaguing smartphones and tablets. Example: Apple sells the iPhone 6 with 16GB of storage, not nearly enough room for all the functions a modern smartphone is expected to provide. Even the base Moto X, which some people consider the best Android smartphone available, has only 16GB of storage. Google’s expansion to 50,000 songs – approximately 200 GB of cloud space – goes will beyond this limit and provides the convenience of streaming their own library. [Read more: Forbes Tech Crunch  Engadget

Starbucks Will Stop Selling CDs

In Stores At The End Of March

 

     As CD sales continue to slip both in the U.S. and globally, Starbucks has decided to stop offering them at its 21,000 retail shops by the end of next month. Starbucks representative Maggie Jantzen told Billboard the company “continually seeks to redefine the experience in our retail stores to meet the evolving needs of our customers. Music will remain a key component of our coffeehouse and retail experience, [and] we will continue to evolve the format of our music offerings to ensure we’re offering relevant options for our customers. As a leader in music curation, we will continue to strive to select unique and compelling artists from a broad range of genres we think will resonate with our customers.”

Starbucks supposedly will continue to provide digital music to its customers, although Jantzen did not reveal what offerings will be available in the future. “Music has always been a key component at Starbucks,” she said. “We are looking for new ways to offer customers music options.”

Starbucks began investing in music in the late 1990s with its purchase of music retailer Hear Music, which created collections that would inspire people to discover new music. That effort resulted in significant in-store sales, and the company expanded its music push with a partnership with William Morris. A subsequent deal with Concord Music Group led to original music releases from such major artists as Paul McCartney, Joni Mitchell, and Alanis Morissette.

 

Grace Digital’s WiFi Devices Log

More Than 1 Billion Listener Hours

 

Music Business      Grace Digital, a manufacturer of Wi-Fi-based wireless music systems, announced this week its North American customer base has exceeded 1 billion total internet radio listening hours. According to the Edison Research report titled “The Infinite Dial,” internet radio has seen steady listening increases in the U.S. over the last six years, as 21% of Americans listened to it in 2008, while 47% do so today. Listening hours also have increased: the average listening time in one week in 2008 was 6 hours and 13 minutes, a figure that today has more than doubled to 13 hours 19 minutes.

“The growth we’ve seen year over year… mixed with the projections within the industry, show us clearly that wireless streaming of digital content will continue to grow and has become the standard,” Grace Digital Audio’s CEO Greg Fadul said in a statement. “We are committed to our customers and will continue to provide products that will aid in this digital revolution.”

While numerous devices can be used to listen to online radio from a fixed or mobile location, Grace Digital’s Wi-Fi music players serve more as a traditional stereo unit designed for in-home use. 

A publication of Bunzel Media Resources © 2015

Glezos denounces Greek loan agreement as “illusion”

By Manolis Glezos On February 22, 2015

Post image for Glezos denounces Greek loan agreement as “illusion”Syriza’s most senior politician, the 94-year-old war hero and MEP Manolis Glezos, opposes his party’s decision to extend the Eurozone bailout program.

Before it’s too late:

The fact that the Troika has been renamed ‘the Institutions’, the Memorandum has been renamed the ‘Agreement’, and the creditors have been renamed the ‘partners’ — in the same manner as baptizing meat as fish — does not change the previous situation.

You can’t change the vote of the Greek people in the election of January 25.

The Greek people voted for what SYRIZA promised: that we abolish the regime of austerity, which is the strategy not only of the oligarchies of Germany and the other creditor countries but also of the Greek oligarchy; that we abrogate the Memorandum and the Troika and all the austerity legislation; that the next day, with one law, we abolish the Troika and its consequences.

A month has passed and this promise has yet to become action.

It is a pity indeed.

From my part I APOLOGIZE to the Greek people for having assisted in this illusion.

Before we continue in the wrong direction, before it’s too late, let’s react.

Above all, the members, the friends and supporters of SYRIZA, in urgent meetings at all levels of the organization, have to decide if they accept this situation.

Some people say that in an agreement you also have to make some concessions. But as a matter of principle, between the oppressor and the oppressed there can be no compromise, as there can be no compromise between the slave and the tyrant. Freedom is the only solution.

But even if we accept this absurdity, the concessions that have already been made by the previous pro-memoranda government with unemployment, poverty and suicide, are beyond any limit of concession…

Manolis Glezos is a Member of European Parliament for Syriza. Source:News247Translation by Panagiotis Sotiris. Photo courtesy of GUE/NGL.