Spying for Fun and Profit

New technology has become ubiquitous in the post-Sept. 11 world. Biometric devices record the facial bone structures, iris scans, voices and other physical attributes of every person who walks by in an airport, stadium or park. Electronic monitors track web page visits or bank transactions. Even good old-fashioned video surveillance cameras are being used more than ever in conjunction with facial recognition software.

All these technologies raise serious questions about invasions of privacy and violations of civil liberties. They also cost a lot of money. Taxpayers fund this massively beefed up security. Private corporations and even individuals are also paying large amounts to boost their own security procedures in light of the war on terrorism. Naturally, someone is also profiting off this boom.

Market analysts and corporate watchdog groups note that there have been a raft of upstart companies jumping into the security/ surveillance market, and existing major security and defense companies have expanded their product lines and sales.

"There's definitely more demand," noted Lee Tien, a staff attorney for the Electronic Frontier Foundation, which monitors electronic-related privacy and civil liberties issues. "For example you see this stuff popping up in airports, and then that creates secondary effects where all these vendors realize they have something to sell and start marketing it, and then legislation like aviation security helps. And then there's this ripple effect where people [and corporations] say, 'Well if the government's doing it, maybe we better be doing it too.'"

There are several main technologies driving the market: bomb and explosives detection devices used at airports and other high security areas; biometrics technology used all across the spectrum for screening and identifying people; smart card technology to combine data on an all-purpose ID card, as has been discussed with the standardized national driver's license; and electronic data-mining technology of the type that would be used to compile records for the Terrorism Information Awareness (formerly Total Information Awareness) program.

The Spy-Tech Boom

One of the first widespread security technologies to be discussed after the Sept. 11 attacks was face recognition software in airports. Almost immediately after the terrorist attacks, two providers of this software -- Visionis and Viisage -- started marketing their products as terror prevention solutions.

"Their publicity stunt worked," said Chris Hoofnagle of the Electronic Privacy Information Center (EPIC) in a Nov. 2001 interview with the Multinational Monitor. "Their stock prices doubled very quickly, and it appeared as though different public transportation centers would adopt the technology. In fact, Oakland International Airport has."

Since then, various other airports including Dallas, Rhode Island and Boston and other tourist destinations including the Virginia Beach oceanfront and a Tampa nighlife district have purchased facial recognition systems. One of the main beneficiaries has been Pelco Inc., the world's largest maker of video security systems.

The growth in demand for software alone to comply with the PATRIOT Act has been huge -- the act requires financial institutions, including banks, credit card companies and insurance carriers, to closely monitor customer activity. Cisco, Sybase, Sun Microsystems and Oracle are just a few of the various software companies ready to meet these demands, often by expanding their existing lines of anti-money laundering (or AML) software.

"Compliance with the USA PATRIOT Act has never been easier, thanks to Sybase's PATRIOT compliance solution," says a promo on the company's web site.

There has been some small protest within the companies; in March 2003, Groove Networks Inc. board member Mitch Kapor quit in protest over Groove selling its software to the government for anti-terrorism surveillance. And one vendor refused to sell its software to the government. But, for the most part, companies have jumped at the chance of government contracts.

Veni, Vidi, Vendors

In a report called "The USA PATRIOT Act: Impact on AML Vendors and the Market," financial services analyst Breffni McGuire wrote that, "although the law imposes new burdens on banks, it is proving to be a boon for vendors of AML and related products and technology."

The report said software vendors had seen inquiries rise 200 to 300 percent in the months following Sept. 11. Many are hesitant to question the necessity or efficiency of security-related expenditures, but the fact is this may be more a matter of companies capitalizing on opportunity to create a demand rather than developing products that genuinely offer a needed service. In reality, much of the now-popular security technology had been developed and marketed for other purposes before Sept. 11.

For example for years Oracle had been pushing for a national ID system which would include a standardized driver's license or other card with a biometric identifier. In the Multinational Monitor interview Hoofnagle noted that Oracle offered to donate software to run the program to the government, in hopes of future profit.

"Donating the software is a significant move, however Oracle would significantly profit from maintaining the database in the future," Hoofnagle said. "National ID is extremely expensive, and in other countries where it has been proposed, officials invariably underestimate the cost."

Likewise in 2002 the Food and Drug Administration approved the long-in-development sale of subdermal microchips which would allow someone's location to be tracked at any moment. While now these chips are mentioned as parts of a hazy plan to keep tabs on all residents at all times, in the past they were marketed to parents on the basis that they could help them find their children should they be kidnapped.

"Lots of these technologies have been in the works and looking for a justification for a long time," said Charlie Cray of the group Citizen Works. "Then some news event comes along and they find someone to push it. For example, every once in a while you see a national story about some kid getting kidnapped. Then someone says that's a reason why parents should get their kids registered in some kind of national database. Of course, what they don't tell you is the corporate motive behind this fear-mongering. That Oracle just happens to own the national ID database that would be used."

Biometric Bungles

A report released by the General Accounting Office (GAO) in spring of 2002 said that government agencies had spent more than $50 million in the past five years on camera surveillance technology, with a notable increase in spending proposals after Sept. 11. A big chunk of this money was funneled toward facial recognition programs, which made up 90 percent of government surveillance budgets since 1997 according to the GAO report. In the pre-terrorism era, significant surveillance funds were also designated for catching and fining red light runners. In nabbing red light runners, surveillance technology has been highly effective. But for catching would-be terrorists, it is a different story.

While biometrics is currently all the rage for everything from scanning for terrorists in crowds at public events to recording participants at demonstrations, the fact is the technology is highly error-prone and not well-suited for these functions. A study by the National Institute for Standards in Technology showed that face recognition biometric technology turned up false positives in matching scans with a database 43 percent of the time.

"There are enormous operational problems here," said Tien. "It's one thing to use biometrics to control who enters an office building, but it's another to try to screen thousands of people at an airport or border crossing."

He noted that the use of biometrics and other surveillance equipment at borders is really in vain, since it can only be used at official border checkpoints and other small specific areas of the huge borders. "If a terrorist really wants to get into the country they'll just hire a marijuana smuggler to get them in a boat into the swamps in Louisiana," he said.

Defense CEOs' Cash Crop

David Martin, a researcher and media coordinator at the non-profit United for a Fair Economy, noted that as with surveillance technology, increased government spending as well as speculation is leading to major profiteering for defense companies -- and even more so for their CEOs. A recent report Martin co-authored, called "More Bucks for the Bang," found that the salaries of CEOs of the top 37 publicly traded defense companies have mushroomed way out of proportion to other CEOs and also out of proportion to the companies' actual profits.

"They're pocketing a lot," Martin said of the CEOs. "We had an inkling that their pay was increasing but after we did the study we were shocked by the actual numbers we saw."

While these companies are primarily involved with manufacturing weapons, many of them, including Dell Computers, also develop electronic or other surveillance-related technologies.

The defense company CEOs' pay increased an average of 79 percent from 2001 to 2002, compared to 6 percent for CEOs in general. The CEO of Lockheed Martin, the country's largest defense contractor, increased 400 percent. The study also found that the amount of a company's campaign contributions are in direct correlation (statistically .90) with the size of the defense contracts they receive.

As with most of the legislation and political programs that have come to pass since Sept. 11, the growing market for security and surveillance isn't likely to go away even if our country goes years without suffering a terrorist attack. Even before most people had ever heard of Al Qaeda, Americans were becoming more and more obsessed with both locking themselves in and finding ways to sneak peeks at others -- witness the parallel growth in both gated communities and voyeuristic web cams and reality TV shows.

"You can't totally differentiate between what's going on now and the natural trends before Sept. 11," Tien said, noting the long-time grassroots popularity of low-level surveillance gadgets. "People are very interested in security and watching each other -- we're all watched by Big Brother, but we're also all little brothers watching each other." Now, with security as the excuse for all kinds of surveillance, there are a few companies who stand to make a large profit -- and a lot of citizens who will lose something even more precious -- their privacy.

Kari Lydersen writes for the Washington Post and is an instructor for the Urban Youth International Journalism Program in Chicago.


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