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Q: I don't feel real warm and fuzzy with the fact that this latest
anti-terrorism legislation is supposedly sunsetted. I'm not a betting man,
but I would bet it doesn't go away.

A: I bet that it won't go away either.

Q: Government is not ever in a great big hurry, notwithstanding the fact that
the Constitution was designed as a government-limiting tool. It wasn't
intended to give us stuff. It was intended to control government. I'm not
sure where that concept got lost, but it got lost. Once they have acquired a
new power, I can't see a government willingly, anxiously giving it up again.

A: I really agree with you about that. And we see it with this 1994 statute,
the Communications Assistance for Law Enforcement Act. They got that through.
They keep trying to expand it, and then we see it flowering anew with even
broader powers through the U.S. Patriot Act.

Q: In that 1994 legislation, CALEA, the way that was sold, it was sold to
Congress and to the American people. It was going to improve privacy
protection.

A: Yes.

Q: Now even people that don't understand this stuff empirically will say
that's good. I want my privacy protected. But it did just the opposite of
that. At what point is anyone, the FBI or Congress, to be held accountable
for that fraud?

A: I think they should be held accountable immediately. But within the way
the system is structured. But ordinary Americans are just thinking about
their business and taking care of their families, and they trust their
elected officials, or at least some of them. Ordinary people don't have time
to investigate these things. Then you have the reality that elected officials
are sometimes trying to hide what is being done, or heads of agencies are
trying to misrepresent what is being done, so it is a very challenging thing.
All we can hope for is that ordinary people take it upon themselves to become
informed and do some of their own research, like you did in reading NAFTA.

Q: I don't think I'd do it again.

A: I always tell my students when I'm teaching international economics that
if NAFTA were only designed to establish free trade between the countries, it
wouldn't have taken thousands of pages to do it.

Q: Hey, GATT was probably 10 times bigger. They killed a lot of trees to
print that sucker. Actually, Dr. Pat Choate was kind of my mentor throughout
the NAFTA/GATT battles. Pat kept telling me all this stuff, and I was in
denial. I said, "Come on, that just can't be right." Then I took a weekend
and plowed through it, and then I had my epiphany. The dispute resolution
stuff with executive session committees, real Star Chamber stuff that most
Americans to this day don't understand, and arguably don't care about.

A: And I'm thinking about that Communications Assistance for Law Enforcement
Act, and also especially the new Patriot Act. You've seen all the provisions
where you can't even understand what they are doing from the actual language.
It is referring to some other section, a completely different statute, and
they are just saying change this and insert the words …

Q: I hate that! That should be illegal for them to do that. You read
something, and they say "change the 'therefore' to a 'whereas' in
subparagraph (d), page 832," and they don't show you what they are changing.

A: Yes, and so they aren't even straightforward enough with us to list out
what the new wording will be and what the implications of that will be.
Instead, you have to do weeks of research to figure out what is actually
coming down.

Q: In the long piece you wrote on CALEA, once that filters down to the states
and counties and municipalities, who holds their hands to walk them through
the revisions?

A: I don't know the answer to that in detail.

Q: Do they just get a memo from the FBI saying this is a policy directive,
and you are to do it this way because we tell you to?

A: Basically, the Communications Assistance for Law Enforcement Act allows
the government to require the telecom carriers to install certain equipment
that will make surveillance easier. The issue then is what kind of authority
the law-enforcement officials have to have to gain access to that, and I
don't know the details, but I know there are memos that go from the FBI on
down to the local law enforcement.

Q: I remember there was some software that the FBI was supposed to install at
the ISPs (Internet service providers) and Earthlink for one told them no.

A: And the court said that they had to accept it anyway.

Q: Wasn't there more to it though? Earthlink didn't object for the altruistic
reasons of protection of privacy. They were concerned techno-geek-wise,
because the software the FBI had messed up their system somehow.

A: Yes, they were worried about that, but it is my understanding that they
lost in court.

Q: I am sorry to hear that. Buried in the middle of your language, there is
one phrase that particularly struck me because it is a pet peeve of mine. I
am an equal-opportunity offender. My litmus test is the Constitution and the
Bill of Rights. Anything or anyone who attempts to mess with that I consider
bad.

A: OK.

Q: I often observe that many of our problems are the product of
incrementalism. And you write, "The passage of CALEA was rife with other
forms of political transaction cost manipulation as well. Most important were
incrementalism, concealment of their cost, and other things." How do they
conceal costs?

A: One thing was that the telecommunication carriers documented in the
hearings how much it was going to cost to install all of this equipment. So
the remedy they came up with was to provide a certain amount, and it was a
certain dollar amount that was to be provided for a limited number of years
to help in the setting up of this equipment. But the telecommunications
carriers said that what the government was offering was a drop in the bucket
compared to the actual costs that would be incurred by the telecom companies.

Q: Here you go: "Authorized appropriation of $500 million annually for fiscal
years '95 through '98 …"

A: Yes. And the telecom carriers said it would be much more than that, and it
would be an ongoing cost that was not going to be covered by the government –
meaning the taxpayers – so the telecom carriers would be saddled with that.

Q: Which they would no doubt be compelled to pass along to their customers.

A: Yes. So that was hiding from the public the cost of the entire measure
that was this statute.

Q: This whole concept of "political transaction cost manipulation," you've
kinda made an avocation of that haven't you?

A: Yes. Actually, my doctoral dissertation was the first place I sort of
officially developed this idea. At that time, I was looking at the federal
financing bank and off-budget expenditures through the federal government and
through that federal financing bank. I have sort of tested that theory in
looking at many different areas of our political economy, and time after
time, the types of behaviors that I identified in my theoretical work turned
out to have been exactly what politicians and legislators did in practice.

Q: Were you able to stick a pin in a timeline somewhere and determine when
this political transaction cost manipulation started?

A: Oh, probably centuries ago. Certainly in our country it has blossomed in
recent years. But you can read Machiavelli, and really what they are talking
about is political transaction cost manipulation.

Q: The inimitably frustrating thing to the taxpayer is we all have to run our
own finances.

A: Yes.

Q: And it's pretty simple. You can't spend more than you make without going
into hock. And there is cash in and cash out. It's really pretty simple. It
really is not calculus. Yet it seems that anytime the government gets
involved in anything involving our money – not their money, our money –
their primary focus in life seems to be to make it as convoluted and complex
and disorienting as possible.

A: They are going to reduce resistance by doing that. And that is one of the
types of behaviors I have been studying for some years now. All of these
things – the incrementalism, the making something more complex than it needs
to be, doing all these round-about things, even that funny little … I mean
it's not funny, it's deadly serious … but putting some power-increasing
measure between a Border Patrol section and something else that is totally
unrelated – these are ways of obscuring what is being done. And from the
government's point of view, minimizing resistance to these measures.

Q: I made the observation earlier that Ayn Rand once said eventually
everything is going to be illegal, and they'll just catch the ones they want.
You quote James Scott. He talks about legible people. What are legible
people?

A: It is a very wonderful book that talks about, in part, how governments
seek to make people legible to the government. He's got some very interesting
material in there about how even assigning last names, making sure that
people have first and last names, if you go back historically, and he goes
back centuries and looks at all different countries and places. He shows how
one of the primary purposes of government for ages has been to try to
identify what all the people are doing – where they are, who they are, who
they are related to. And, of course, that is necessary if you are going to
establish a system of taxation. So they have a big financial interest in
doing that.

Q: That is interesting. Several years ago, I did a family genealogy thing,
and the first place the name Metcalf shows up …

A: Yes?

Q: … is on the Assize Roles in 1252, in England.

A: Really? That is interesting. Well, there you go!



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Read Dr. Charlotte Twight's article, "Conning Congress: Privacy and the 1994
Communications Assistance for Law Enforcement Act,




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