Author Archives: Quincy

A Vote for Revenue

Politicians are usually most revealing when speaking off-the-cuff, and so it was with Karen Bass:

Q: How do you think conservative talk radio has affected the Legislature’s work?

A: The Republicans were essentially threatened and terrorized against voting for revenue. Now [some] are facing recalls. They operate under a terrorist threat: “You vote for revenue and your career is over.” I don’t know why we allow that kind of terrorism to exist. I guess it’s about free speech, but it’s extremely unfair.

The California Assembly Speaker was talking about California’s budget crisis. There is a simple problem here. Decades of runaway spending by both the democratically-controlled legislature and voters during the boom years has the state government scrambling to meet its commitments now.

The solution, however, is more complex. Democrats have been the majority party in the legislature for decades, and this budget mess falls squarely on their backs. The solution, deep cuts to wasteful and often useless state bureaucracy, is simply not an option to them. Cutting the bureaucracy would be a loss of political capital for the Democrats, making the entire enterprise of state government less profitable. Instead, we have people like Karen Bass pulling stupid politician tricks:

The Golden State is one of only three in the nation which requires a two-thirds majority vote to raise taxes. This is forcing Democrats in Sacramento to try to recruit a handful of Republicans to pass their current plan to close the state’s gap with a combination of cuts and taxes. So far, no GOP legislator has broken ranks.

Then came Plan B. This week, the Democratic leadership mustered enough support to pass a series of budget bills with a simple majority, hoping to send them onto Governor Schwarzenegger.

Some of these bills do raise revenues, but legislators believe they can avoid the necessary two-thirds majority by reclassifying some taxes as “user fees”, while raising taxes elsewhere and claiming the end result is “tax neutral”.

A call to the Legislative Counsel’s office pointed to the part of the State Constitution which explains the need for a two-thirds majority: “any changes in state taxes enacted for the purpose of increasing revenues collected pursuant thereto whether by increased rates or changes in methods of computation must be imposed by an Act passed by not less than two-thirds of all members elected to each of the two houses of the Legislature, except that no new ad valorem taxes on real property, or sales or transaction taxes on the sales of real property may be imposed.”

But when pushed for an explanation as to where the law allows a simple majority, by creating “revenue neutral” taxes and exchanging a tax for a user fee, we were directed to the Assembly Speaker Karen Bass’s office.

Her office did not return calls or emails (though the emails were read). Other calls asking for guidance were met with silence, and another reference to the section of the state constitution cited above.

So, this is what Karen Bass means when she says Republicans have been terrorized into voting against revenue? Let’s revisit her quote and fill in what’s actually happening:

The Republicans were essentially threatened and terrorized against voting for a law that deliberately violates taxpayer protections in the Constitution. Now [some] are facing recalls. They operate under a terrorist threat: “You vote for a law that deliberately violates taxpayer protections in the Constitution and your career is over.” I don’t know why we allow that kind of terrorism to exist. I guess it’s about free speech, but it’s extremely unfair.

Karen Bass is saying that pressuring politicians to simply follow the law is terrorism. As Instapundit would say, the state is in the best of hands!

Public Schools and the Public Option

Imagine a private school where students sat in a math class for weeks misbehaving and learning nothing. Imagine that school gets on TV news because the administrators suspended the young lady who blew the whistle by taking a cell phone video and giving it to her mom who confronted them. Do you think that school would have enough students to start the next school year?

Well, this happened at a public high school in the SF Bay Area:

A freshman at Clayton Valley High School in Concord, California says that’s just what she had to endure in algebra as her classmates went wild.

“People smoking marijuana in the classroom. They smoke cigarettes.” Arielle said. “There was one kid who peed in a bottle and threw it across the room.”

Clayton Valley High School is a public high school, and I have no doubt that it will open with just as many students next year as it did this year. When parents pay for an education, they absolutely will not tolerate a school run like Clayton Valley HS. When the state provides an education for free, a vast majority of parents will generally take what they can get and call it good enough. They might picket and protest for improvement, but they won’t take their kids out of the school.

What does this have to do with health care? The public option being created as part of “ObamaCare” is rather similar to public schools, in that it is designed to undercut private health insurance on the basis of price:

The Lewin Group crunched the numbers through their health care model and found that premiums for the public option plan would be 30 to 40 percent lower than private plans.

A price difference of that magnitude would lead employers to throw their employees into the ObamaCare option:

Overall, the Lewin Group estimates that if Medicare reimbursement rates are imposed, the number of Americans with private health insurance would decline by almost 120 million, leaving only 50 million Americans in the private insurance market.

That would leave approximately 15% of the population in non-government health care, just slightly more than the percentage of students that go to private school. At that point, ObamaCare will have similar monopoly power to the public schools. I expect abuses and incompetence similar to that captured by Arielle Moore at Clayton Valley High when the public option achieves its monopoly power. The scary difference is that instead of not learning algebra, the people who have to suffer that abuse and incompetence will be missing out on life-saving medical treatments.

A human life is too important to waste on government health care.

Update: John Calfee compares ObamaCare to Fannie Mae and Freddie Mac in the WSJ. Yet another sterling example of how we don’t want our health care managed.

Trust, blogs, and the FTC?

So, the FTC is coming after bloggers who make money and don’t adequately disclose it:

New guidelines, expected to be approved late this summer with possible modifications, would clarify that the agency can go after bloggers – as well as the companies that compensate them – for any false claims or failure to disclose conflicts of interest.

It would be the first time the FTC tries to patrol systematically what bloggers say and do online. The common practice of posting a graphical ad or a link to an online retailer – and getting commissions for any sales from it – would be enough to trigger oversight.

The Federal Government is the least trustworthy enterprise in the United States. Its leaders and representatives work solely for the benefit of the enterprise, circumventing its own rules and all standards of decency and honesty whenever they deem it necessary. Heck, just this week I received a bill–with penalties and interest–for a tax balance I paid before April 15. Really, how can Washington have any moral standing on this one?

A boot stamping on a human face…

…forever.  But, if San Francisco’s most famous street vendor has anything to say about it, that boot will be well-shined:

He sleeps under a bridge, washes in a public bathroom and was panhandling for booze money 11 months ago, but now Larry Moore is the best-dressed shoeshine man in the city. When he gets up from his cardboard mattress, he puts on a coat and tie. It’s a reminder of how he has turned things around.

In fact, until last week it looked like Moore was going to have saved enough money to rent a room and get off the street for the first time in six years. But then, in a breathtakingly clueless move, an official for the Department of Public Works told Moore that he has to fork over the money he saved for his first month’s rent to purchase a $491 sidewalk vendor permit.

“I had $573 ready to go,” Moore said, who needs $600 for the rent. “This tore that up. But I’ve been homeless for six years. Another six weeks isn’t going to kill me.”

The bureaucrat told Moore that she found out about his business after reading about his success in this paper.

Most amazingly, Moore was not even indignant and sought to play by the rules, only to have more barriers thrown in his path:

Moore is nothing if not dutiful. He attempted to work his way through the byzantine city government channels, although he didn’t get much help.

“I guess my gripe is that when the city came by and told him to get his papers in order but couldn’t tell him how to do it,” said Travis See, who manages the Custom Shop Clothiers on the corner of Market and New Montgomery. “This lady couldn’t even tell him which building to go to so he could stand in line and waste all day.”

When Moore found the permit application, he got a money order and headed down to the appropriate department to pay. But because he didn’t have a valid ID card, they wouldn’t take his money.

Through all this, Moore maintains a positive attitude and wants to be an upstanding citizen:

The only one who isn’t furious about this is Moore. He insists that city functionaries are giving him a break because they are letting him continue to shine shoes while he waits for a copy of his birth certificate to be sent from Kansas. Once it arrives they will allow him to get an ID card and then hand over almost every cent he has.

I feel compelled to say that Moore is a better man than I. He’s faced the tyranny of the petty bureaucrat with incredible composure, and he deserves every shred of respect and help he’s gotten for this. Fortunately for Mr. Moore, the situation seems to be working out for him:

Reiskin told him his department would help set up the permit, the Homeless Outreach Team van pulled up to see if he wanted to talk about supportive housing, and homeless coordinator Dariush Kayhan sat down in the chair as soon as Reiskin’s shoes were shined.

Moore said he was honored to see them but still charged them his usual fee, $7. (It’s $5 if you are unemployed.)

Moore has set aside the $491 for the permit, which he’ll get as soon as his birth certificate arrives from Kansas and he can get a municipal ID card.

In retrospect, it’s easy to see how this mess started. Usually when a city worker tells a street vendor to get a permit, the response is excuses and vague promises. They didn’t expect Moore to take them seriously.

But Moore is a man on a mission.

“I want to be on this corner,” he said. “But you know what? You need me on this corner. You got people in this city getting a free room and free medical but they aren’t doing nothing with their lives. I want people to see me and say, ‘There’s a guy working hard.’ ”

If you’d like to see that, stop by his stand on Market. He starts at 9:30 in the morning, although he might sleep in a little today.

“I am going to go get a room tonight for the whole week,” he said. “I deserve that. At least I think I do.”

I’m very glad Larry Moore will end up sleeping in a bed tonight, and that in the end the generosity of the people of San Francisco has made sure he will be able to pay both his rent and the city.

However, that resolution is a case of the exceptional, while the bureaucracy remains the way of life in San Francisco.  As this case shows, it’s a way of life that deserves to be questioned.  Are the people of San Francisco better off because Larry Moore had to waste time and money having a birth certificate sent 1,500 miles so the city could verify his identity? Are the people better off with $491 of this man’s money going to the city rather than a landlord?  Will Larry Moore suddenly provide service any better because he now has the benediction of the Department of Public Works?

These questions raise the most important one… Just who are these permits supposed to serve?

RFID and Privacy

Yesterday morning I was sent an article written by Michigan House Representative Paul Opsommer regarding the Department of Homeland Security’s push to implement Enhanced Drivers’ Licenses:

The Department of Homeland Security is coming to Detroit to push their new “Enhanced Drivers License” (EDL) program on Tuesday as a way to make Michigan licenses compliant with the federal Western Hemisphere Travel Initiative (WHTI). If you don’t pay to enhance your license, you’ll need a passport in order to continue going across the Canadian and Mexican borders in June (you’ll still need a passport to fly).

Opsommer argues that it would make better sense to lower the price of a passport instead of trying to graft the purpose of a passport on to a drivers’ license. Then, he gets to the heart of the DHS proposal:

Instead, they’re offering to “enhance” our license by having a security interview, paying more, and then getting a wireless RFID chip in your license. While the first two requirements seem reasonable, if the part about the wireless RFID chip has you scratching your head, you’re not the only one. We already wisely don’t issue licenses to illegal aliens, but with the enhanced license you have to be able to not just prove your citizenship, but prove it via a wireless chip. Everyone who applies will have a new unique federal ID number assigned to them in addition to their current Social Security Number. The wireless chip then carries that new number, which can be wirelessly scanned by common readers up to 30 feet away, even while it’s still in your wallet.

In theory this will get you through the border faster, but then you are left with an unencrypted chip in your license for the other 12 hours a day you carry it.

He says the following about the privacy implications:

There is currently nothing in the law prohibiting the government from using this to track people away from the border, and also nothing in the law that would prohibit banks, hospitals, hotels, or others from linking you with the number and using it for their own marketing purposes or selling it.

Technically, this technology never tracks people, it only tracks the license. The assumption is that the license is being carried by the license holder when out in public, thereby being a good proxy for tracking the person. However, wallets and purses can be left at home, lost, or stolen, at which point the assumption breaks down.

For the sake of argument, let’s assume that the RFID-chipped license will be carried by the owner 99% of time. This is the equivalent of forgetting one’s license three or four times a year, which is not uncommon for most of the folks I know.  In cases where identity verification is considered critical, such as at a border crossing, a 99% accuracy rate isn’t good enough.  Therefore, the system isn’t designed to operate by reading the license alone:

Enhanced drivers licenses will make it quicker and easier to cross the border back into the United States because they will contain

  • a vicinity Radio Frequency Identification (RFID) chip that will signal a computer to pull up your biographic and biometric data for the CBP Officer as you pull up to the border, and
  • a Machine Readable Zone (MRZ) or barcode that the CBP officer can read electronically if RFID isn’t available.

If the system is working as designed, it will accurately identify the person carrying the chip only when a person (or computer) can compare the features of the holder with the features on file. In any other case, the identity of the holder cannot be known for sure. That, however, doesn’t prevent someone from relying on the assumption that a license is always carried by the license holder and not another person.

This is an important point to make before addressing Opsommer’s argument about a “more secure” form of RFID license. In his comment above, Opsommer uses the word unencrypted to imply “less secure”. This is not the case. To fulfill the identification role specified by DHS, the government reader would need to be able to decrypt the encrypted value returned by the chip with no other information. This requires the use of an encryption algorithm that produces a unique encrypted number for each unencrypted number submitted to it.

The tracking opportunity is the same in either case. People are running around with unique RFID signatures that can be read from up to 30 feet away. The first piece of information a would-be tracker would get is the RFID signature. Once the signature is encountered, the tracker can start gathering information about the holder of the RFID-chipped license.  The interesting thing to consider here is that a third-party tracker piggy-backing on the DHS-sponsored license system would not need to match the ID number to a pre-established identity, meaning the encrypted value is just as useful for third-party tracking as the unencrypted value.

Imagine that a supermarket chain wanted to track its customers using the RFID signature of a drivers’ license.  They set up a scanner to read in the area where a patron would stand to interact with the checker and read the license every time payment was accepted.  It would be possible to track a patrons buying habits by linking the data saved from the register to the RFID signature.  In the case a club card was used, the drivers’ license would be linked back to the name on that.  If a check or credit card was used to pay, that financial information could then be linked to the RFID signature.  The store would now have an entire identity built around the unique signature that has nothing to do with the DHS database.

Taking this hypothetical to the next level, imagine that a diverse array of businesses such as banks, hospitals, hotels, casinos, restaurants, and bookstores began employing similar tracking techniques.  Each would build an identity around the unique signature of the chip.  The bank would know one’s financial habits.  The hospital would know one’s health problems.  The hotel would know when one visited.  The casino would know when one gambled.  The restaurant would know what one ate.  The bookstore would know what one read.  And the supermarket from before would know what one bought.

At that point, there would be an opportunity for an information clearinghouse to buy tracking data keyed to the unique RFID signature from different sources and build an amazingly detailed profile of the license holder/carrier.  The clearinghouse would know everything from their name, telephone number, and address to the fact that they bought a box of 24 donuts on Tuesday despite having diabetes.

In the extreme, it would be possible for the government itself to leverage the work of the clearinghouse by purchasing the data and crossing it with the DHS database.  This scenario is both technically possible and consistent with previous DHS behavior.  Encryption would make no difference in this case because DHS can already decrypt the RFID signature.  Imagine what the government could do with all that information about how a citizen lives his life?

Remember that this detailed profile grew out of exposure to a single unique signature.  The businesses doing the tracking started knowing nothing about the person other than the unique number emitted by their RFID-chipped license.  The only measure of safety encrypting the number provides is that the RFID tag could not be used to query the DHS database.  Of course, since one’s name would be revealed in one of many transactions, even this layer of protection is transitory since the DHS database would contain both name and ID number.

Back to Rep. Opsommer’s article, he laments the situation by saying the following:

[A]t the very least they need to offer enhanced licenses in two varieties, one that has RFID and one that doesn’t, and then let taxpayers decide which they want to choose. DHS has instead chosen a take it or leave it approach that bullies taxpayers with fiscal coercion and a one-size-fits-all policy that doesn’t allow Michigan to use more secure forms of RFID or to skip the chips altogether. Since an EDL will also technically be a limited passport, how the biometric data on the computer system gets shared with the governments of Canada and Mexico is also important.

I would submit to Representative Opsommer that encryption simply doesn’t matter.  Any RFID license that can be read without the holder’s consent is a threat to privacy.  Metallic sleeves and other devices that shield the license are not good enough, since they can be lost or forgotten.  The Ontario government has found a good solution to this problem, though.  They are looking at an Enhanced Drivers’ License that can be read only when someone holds it a certain way:

Seattle-based RFID chip manufacturer Impinj Inc. has demonstrated a prototype vicinity RFID card with a switch.

The design activates the RFID chip when someone places their finger on the corner of the card.

A mechanical switch – with moving parts – would be too frail, says Kerry Krause, vice-president of marketing at Impinj. So they took a different approach.

“With our technology, all you have to do is touch it,” he says. “The tag is only readable when a person is holding the driver’s licence and pinching it in the right spot. Your fingers are completing a circuit and turning it on.”

Such a license offers true privacy, as the person holding it has to take an explicit action for it to be read.  Anything short of this is simply a privacy violation waiting to happen.

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Update – 4/22 @ 1:35 PDT – Thanks to Jeff Molby in the comments for pointing out that the government leveraging privately-collected tracking data is already happening.  Post updated with this information.

Update – 4/22 @ 6:21 PDT – Commenter “Encryption could matter” mentioned the use of push-button technology.  I’ve found info on this and it has been added.

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