Clearly, our economy is still in bad shape. Unemployment and the state of the real estate market, key indicators of economic strength, are still suffering.
Despite this, Congress might pass the American Jobs and Closing Tax Loopholes Act. This bill raises taxes on investment partnerships in real estate and other ventures by more than 150 percent and will stifle economic activity. Rep. Zack Space joined his Democrat colleagues in voting "yes," and the U.S. Senate might vote on the legislation soon.
This bill increases taxes on carried interest, taxing it higher than the current capital gains rate. It will stifle profits on commercial real estate transactions and will harm the real estate industry, whose health is vital to economic recovery. The still-fragile real estate industry cannot handle this tax increase, too.
More than 1.2 million partnerships own more than $1 trillion in commercial real estate nationwide and rely on the current system to build and revitalize our neighborhoods. Business partnerships are the primary model for development of commercial investments. The Ohio Senate passed a resolution I sponsored urging Congress to maintain the current carried interest tax rates.
This tax increase will reduce profits for entrepreneurs and disincentivize investment in projects that create jobs and economic growth. It will make it difficult for partnerships to invest in job creation and will only drive up already high unemployment.
The U.S. Conference of Mayors agrees. In a letter to Congress, they wrote the bill will "will lower tax revenues at the federal, state, and local levels and limit opportunities for redevelopment and underutilized properties, hindering job creation."
Congress must make choices to strengthen our economy, passing laws that support an environment that rewards hard work and success, not laws that overburden profitable businesses. By passing this law, Congress will be enacting a policy that would be disastrous to our country's economic stability and strength.
Rep. Space already made a poor choice by passing this tax increase. I urge Sen. Voinovich, R-Ohio, and his colleagues to make the right choice and avoid this tax increase in the midst of our economic recovery.
Let's check in on San Diego foreclosure activity. This indicator is only marginally useful because, as discussed many times previously, much of San Diego's foreclosed inventory has been kept off the market. When new homes go into foreclosure, they may increase the backlog of "shadow inventory" but they don't necessarily have any immediate effect on supply. Still, it's worth looking at how fast that backlog is building.
The red line on the accompanying graph denotes the number of monthly Default Notices, which occur when borrowers officially enter foreclosure. The orange line signifies Trustee Deeds, which take place later in the process as homes are repossessed by their lenders.
Both rates have been trending down since last year, but both are quite high in absolute terms. Even adjusted for population growth, the pace of both Default Notices and Trustee Deeds are higher than anything that was seen even at the worst of the early-1990s housing bust.
So while new foreclosures are gathering more slowly than they were in the darkest days of the recession, they are still piling up at a pace that -- from a historical perspective -- can be charitably described as "brisk."
On the occasion of the BP oil spill disaster, President Obama’s delivered an Oval Office speech last night—a masterpiece of milquetoast faux-outrage. The speech was all about “clean energy” and “ending our dependence on fossil fuels”. Faced with the BP oil spill—likely the most severe environmental disaster ever—this was President Obama’s response: Polite outrage, and vague plans to “get tough”, “set aside just compensation” and “do something”.
President Obama missed what the BP oil spill disaster is really about. Though unquestionably an environmental disaster, the BP oil spill is much much more.
The BP oil spill is part of the same problem as the financial crisis: The BP oil spill and the banking crisis are two examples of the era we are living in, the era of corporate anarchy.
In a nutshell, in this era of corporate anarchy, corporations do not have to abide by any rules—none at all. Legal, moral, ethical, even financial rules are irrelevant. They have all been rescinded in the pursuit of profit—literally nothing else matters.
As a result, corporations currently exist in a state of almost pure anarchy—but an anarchy directly related to their size: The larger the corporation, the greater its absolute freedom to do and act as it pleases. That’s why so many medium-sized corporations are hell-bent on growth over profits: The biggest of them all, like BP and Goldman Sachs, live in a positively Hobbesian State of Nature, free to do as they please, with nary a consequence.
The added bonus to this, though, is that the largest corporations have convinced the governments and the people of the “Too Big To Fail” fallacy—they have convinced the world that if they cease to exist, the sky will fall atop our collective heads. So if they fail, they must be saved—without argument, without penalty, and without reform.
Let’s take BP: British Petroleum caused the Deepwater Horizon oil spill in the Gulf of Mexico. There were various Federal Government agencies charged with supervising their operations—but all of those agencies deferred to BP, before the accident. As a large corporation—one of the largest oil companies in the world—BP operated more or less without any Government supervision. As is emerging, because of this lax and toothless supervision, safety rules and procedures were ignored. Insane risks were taken. No safety contingency plans were drawn up.
From what some memos are saying, disaster was inevitable.
Once the accident happened, BP controlled the information it released concerning the disaster. BP unilaterally decided not to proceed with an immediate top-kill of the well—instead, BP risked a wider disaster, in order to save the oil field by drilling a “relief well”. BP’s reasoning was simple: By implementing an immediate top-kill, BP would have sacrificed the oil field (and lost its investment) in order to save the environment. BP did not do this. Instead, it tried to stretch out the process, so as to salvage the oil field (and the profits) with the “relief well”. But when it became impossible to hide the extent of the damage—when the smell of oil permeated the clear skies of Louisiana a hundred miles from the site of the spill—BP tried to implement the top-kill. We know how that ended.
Where was Authority? Where was Someone In Charge? The fact was, there was no one in charge. There was no one supervising—or at any rate, the ones who were supposed to be supervising had had their teeth yanked. And BP knew it—so they did whatever they wanted, regardless of the risks, or the costs.
Worst of all, BP realizes that, if it finally cannot get a handle on the oil spill disaster, they can simply fob it off on the U.S. Government—in other words, the people of the United States will wind up cleaning BP’s mess. BP knows that no one will hold it accountable—BP knows that it will get away with it.
No one was holding the banks accountable either. It’s no accident that American and European banks nearly went broke, but banks here in Chile sailed along smoothly: That’s because banks here are regulated up the wazoo. They literally can’t fart without an independent banking inspector supervising them, and then getting a stamped form in triplicate. When Chile’s banks went bust in the crisis of 1980, it put paid to any illusions that the banks knew what they were doing—the government bailed out the banks then, but kept them under glass ever after.
But in Europe and America, the story was the Greenspan Put. Easy Al was so convinced that the banks would “self-regulate” that he pulled the teeth of the Fed, the banks regulatory agency, and let the “free market” have its way.
With this free pass, what do you think the banks did? They went anarchic—they invented all sorts of clever “financial products” that exponentially increased risk, rather than mitigating it. We all saw how that movie ended. When Lehman busted and the credit markets froze, a slap-dash improvised “rescue package” was drawn up, then the $700 billion TARP, then Quantitative Easing, all of these efforts lubed up with a lot of talk to “strengthening the regulatory environment” and “protecting the financial markets”.
The upshot? The banks did whatever they pleased—with no supervision. And when their recklessness led inevitably to the catastrophe in the Fall of ‘08, the banks got bailed out—with no repercussions. The biggest ones even managed to turn a profit off the tax payer-funded bail-outs!
Even after the worst of the crisis—when the effects of no regulation and no supervision were clearly understood—nothing happened. The zero-regulation, zero-supervision regime continued.
This isn’t the case for people, for individuals: People are regulated, people are controlled. Individuals are supervised and limited in what they can do and say—and no one complains. On the contrary—everyone is relieved, because it protects us all from the unreasonable behavior of an individual.
As an individual, I am limited in countless ways, from the trivial, like jaywalking, to the severe, like murder. I can’t even speak up and yell “Fire!” in a crowded theater—I would be arrested for inciting a panic, the general good of avoiding a potentially lethal stampede overriding my need to express myself by yelling “Fire!” when there is none.
Curiously, individuals—ordinary people—are being supervised and regulated more and more stringently. Yet at the same time, corporations are becoming more and more free to do as they please. No one notices how strange this is—we have even lost the social framework to even talkabout regulating and supervising corporations, because too many foolish pundits equate supervision and regulation with Socialism. Yet curiously, personal freedom is being chipped away, day by day, without a peep from these pundits.
Meanwhile, the banks run amok.
Meanwhile, BP runs amok.
We can look at other industries—Big Pharma, for one—but there’s no real need: Big Pharma will fit the same pattern as BP and the banks. Get so big that you can do whatever you want, and no one will challenge you, not even the government. Carry out practices that will inevitably create a crisis—like unsafe drilling, like toxic bonds—and be confident that you will be bailed out.
Bailed out, and allowed to continue, unfettered. “Allowed” to continue, unfettered? I’m sorry, I mis-spoke: Encouraged to continue, unfettered.
This era of corporate anarchy is reaching a crisis point—we can all sense it. Yet the leadership in the United States and Europe is making no effort to solve the root problem. Perhaps they don’t see the problem. Perhaps they are beholden to corporate masters. Whatever the case, in his speech, President Obama made ridiculous references to “clean energy” while ignoring the cause of the BP oil spill disaster, the cause of the financial crisis, the cause of the spiralling health-care costs—the corporate anarchy that underlines them all.
This era of corporate anarchy is wrecking the world—literally, if you’ve been tuning in to images of the oil billowing out a mile down in the Gulf of Mexico.
I think we are at the fork in the road: One path leads to revolutionary change, if not outright revolution. The other, appeasement and stasis, as the corporations grind the country down.
My own sense is, there will be no revolutionary change. The corporations won. They won when they convinced the best and brightest—of which I used to be—that the only path to success was through a corporate career. No necessarily through for-profit corporations—Lefties never seem to quite get how pernicious and corporatist the non-profits really are; or perhaps they do know, but are clever enough not to criticize them, since those non-profits and NGO’s pay for their meals.
Obama is a corporatist—he’s one of Them. So there’ll be more bullshit talk about “clean energy” and “energy independence”, while the root cause—corporate anarchy—is left undisturbed.
Once again: Thank God I no longer live in America. It’s too sad a thing, to watch while a great nation slowly goes down the tubes.
Gonzalo Lira, a novelist and filmmaker (and economist) currently living in Chile and writing at Gonzalo Lira
BP is trying to raise 50 billion dollars to cover the cost of the Gulf of Mexico spill and is preparing to sue its partners in the oil field, British newspapers said on Sunday.
The Sunday Telegraph said BP is readying to take legal action against US firm Anadarko, its main partner in the field, for its share of the clean-up costs.
The broadsheet cited a "senior BP source" as saying Anadarko was "shirking its responsibilities", not accepting its liabilities and that legal action in the United States is now likely to follow.
The Sunday Times said BP is working on a plan to raise 50 billion dollars to cover the cost of the oil spill, which would start next week with a bond sale to raise 10 billion dollars.
A further 20 billion dollars would come from bank loans, while the final slice is expected to come from asset sales over the next two years, the broadsheet said.
The push is to make sure they have enough money to deal with claims, and to bolster market confidence in its finances, said the weekly.
Meanwhile The Observer newspaper said BP might sell its remaining North Sea interests, plus stakes in dozens of exploration and production projects where it does not exercise overall control, in a bid to reduce its costs.
The weekly, citing "well-placed City sources", said such measures would cut costs by 14 billion dollars (11.3 billion euros) within six months.
BP will also study the possibility of selling its 1.4 percent stake in Rosneft, which it bought at the time of the Russian firm's 2006 flotation for one billion dollars, the report said.
Any theory that does not match experiment is wrong. It doesn't matter what the computer models predict, how much funding is behind it, what the experts say, or what everyone "thinks". Nothing can fool the laws of physics.
June 18, 2010 "Salon" -- On June 6, Kevin Poulsen and Kim Zetter of Wiredreported that a 22-year-old U.S. Army Private in Iraq, Bradley Manning, had been detained after he "boasted" in an Internet chat -- with convicted computer hacker Adrian Lamo -- of leaking to WikiLeaks the now famous Apache Helicopter attack video, a yet-to-be-published video of a civilian-killing air attack in Afghanistan, and "hundreds of thousands of classified State Department records." Lamo, who holds himself out as a "journalist" and told Manning he was one, acted instead as government informant, notifying federal authorities of what Manning allegedly told him, and then proceeded to question Manning for days as he met with federal agents, leading to Manning's detention.
On June 10, former New York Times reporter Philip Shenon, writing in The Daily Beast, gave voice to anonymous "American officials" to announce that "Pentagon investigators" were trying "to determine the whereabouts of the Australian-born founder of the secretive website Wikileaks [Julian Assange] for fear that he may be about to publish a huge cache of classified State Department cables that, if made public, could do serious damage to national security." Some news outlets used that report to declare that there was a "Pentagon manhunt" underway for Assange -- as though he's some sort of dangerous fugitive.
From the start, this whole story was quite strange for numerous reasons. In an attempt to obtain greater clarity about what really happened here, I've spent the last week reviewing everything I could related to this case and speaking with several of the key participants (including Lamo, with whom I had a one-hour interview last night that can be heard on the recorder below, and Poulsen, with whom I had a lengthy email exchange, which is published in full here). A definitive understanding of what really happened is virtually impossible to acquire, largely because almost everything that is known comes from a single, extremely untrustworthy source: Lamo himself. Compounding that is the fact that most of what came from Lamo has been filtered through a single journalist -- Poulsen -- who has a long and strange history with Lamo, who continues to possess but not disclose key evidence, and who has been only marginally transparent about what actually happened here (I say that as someone who admires Poulsen's work as Editor of Wired's Threat Level blog).
Reviewing everything that is known ultimately raises more questions than it answers. Below is my perspective on what happened here. But there is one fact to keep in mind at the outset. In 2008, the U.S. Army Counterintelligence Center prepared a classified report (ironically leaked to and published by WikiLeaks) which -- as the NYT put it -- placed WikiLeaks on "the list of the enemies threatening the security of the United States." That Report discussed ways to destroy WikiLeaks' reputation and efficacy, and emphasized creating the impression that leaking to it is unsafe (click image to enlarge):
In other words, exactly what the U.S. Government wanted to happen in order to destroy WikiLeaks has happened here: news reports that a key WikiLeaks source has been identified and arrested, followed by announcements from anonymous government officials that there is now a worldwide "manhunt" for its Editor-in-Chief. Even though WikiLeaks did absolutely nothing (either in this case or ever) to compromise the identity of its source, isn't it easy to see how these screeching media reports -- WikiLeaks source arrested; worldwide manhunt for WikiLeaks; major national security threat -- would cause a prospective leaker to WikiLeaks to think twice, at least: exactly as the Pentagon Report sought to achieve? And that Pentagon Report was from 2008, before the Apache Video was released; imagine how intensified is the Pentagon's desire to destroy WikiLeaks now. Combine that with what both the NYT and Newsweek recently realized is the Obama administration's unprecedented war on whistle-blowers, and one can't overstate the caution that's merited here before assuming one knows what happened.
* * * * *
Adrian Lamo and Kevin Poulsen have a long and strange history together. Both were convicted of felonies relating to computer hacking: Poulsen in 1994 (when he was sentenced to 3 1/2 years in prison, ironically because a friend turned government informant on him), and Lamo in 2004 for hacking into The New York Times. When the U.S. Government was investigating Lamo in 2003, they subpoenaed news agencies for any documents reflecting conversations not only with Lamo, but also with Poulsen. That's because Lamo typically sought media publicity after his hacking adventures, and almost always used Poulsen to provide that publicity.
Despite being convicted of serious hacking felonies, Poulsen was allowed by the U.S. Government to become a journalist covering the hacking world for Security Focus News. Back in 2002, Information Week described the strange Lamo-Poulsen relationship this way: "To publicize his work, [Lamo] often tapped ex-hacker-turned-journalist Kevin Poulsen as his go-between: Poulsen contacts the hacked company, alerts it to the break-in, offers Lamo's cooperation, then reports the hack on the SecurityFocus Online Web site, where he's a news editor." When Lamo hacked into the NYT, it was Poulsen who notified the newspaper's executives on Lamo's behalf, and then wrote about it afterward. Poulsen told me that the above picture was taken at a lunch the two of them had together with convicted hacker Kevin Mitnick back in 2001. When I asked Poulsen if he considers Lamo his friend, he would respond only by saying: "He's a subject and a source."
Actually, over the years, Poulsen has served more or less as Lamo's personal media voice. Back in 2000, Poulsen would quote Lamo as an expert source on hacking. That same year, Poulsen -- armed with exclusive, inside information from Lamo -- began writing about Lamo's various hacking adventures. After Lamo's conviction, Poulsen wrote about his post-detention battles with law enforcement and a leaked documentary featuring Lamo. As detailed below, Lamo is notorious in the world of hacking for being a low-level, inconsequential hacker with an insatiable need for self-promotion and media attention, and for the past decade, it has been Poulsen who satisfies that need.
On May 20 -- a month ago -- Poulsen, out of nowhere, despite Lamo's not having been in the news for years, wrote a long, detailed Wired article describing serious mental health problems Lamo was experiencing. The story Poulsen wrote goes as follows: after Lamo's backpack containing pharmaceutical products was stolen sometime in April (Lamo claims they were prescribed anti-depressants), Lamo called the police, who concluded that he was experiencing such acute psychiatric distress that they had him involuntarily committed to a mental hospital for three days. That 72-hour "involuntary psychiatric hold" was then extended by a court for six more days, after which he was released to his parents' home. Lamo claimed he was diagnosed with Asperger's Syndrome, a somewhat fashionable autism diagnosis which many stars in the computer world have also claimed. In that article, Poulsen also summarized Lamo's extensive hacking history. Lamo told me that, while he was in the mental hospital, he called Poulsen to tell him what happened, and then told Poulsen he could write about it for a Wired article. So starved was Lamo for some media attention that he was willing to encourage Poulsen to write about his claimed psychiatric problems if it meant an article in Wired that mentioned his name.
It was just over two weeks after writing about Lamo's Asperger's, depression and hacking history that Poulsen, along with Kim Zetter, reported that PFC Manning had been detained, after, they said, he had "contacted former hacker Adrian Lamo late last month over instant messenger and e-mail." Lamo told me that Manning first emailed him on May 20 and, according to highly edited chat logs released by Wired, had his first online chat with Manning on May 21; in other words, Manning first contacted Lamo the very day that Poulsen's Wired article on Lamo's involuntary commitment appeared (the Wired article is time-stamped 5:46 p.m. on May 20).
Lamo, however, told me that Manning found him not from the Wired article -- which Manning never mentioned reading -- but from searching the word "WikiLeaks" on Twitter, which led him to a tweet Lamo had written that included the word "WikiLeaks." Even if Manning had really found Lamo through a Twitter search for "WikiLeaks," Lamo could not explain why Manning focused on him, rather than the thousands of other people who have also mentioned the word "WikiLeaks" on Twitter, including countless people who have done so by expressing support for WikiLeaks.
Although none of the Wired articles ever mention this, the first Lamo-Manning communications were not actually via chat. Instead, Lamo told me that Manning first sent him a series of encrypted emails which Lamo was unable to decrypt because Manning "encrypted it to an outdated PGP key of mine" [PGP is an encryption program]. After receiving this first set of emails, Lamo says he replied -- despite not knowing who these emails were from or what they were about -- by inviting the emailer to chat with him on AOL IM, and provided his screen name to do so. Lamo says that Manning thereafter sent him additional emails encrypted to his current PGP key, but that Lamo never bothered to decrypt them. Instead, Lamo claims he turned over all those Manning emails to the FBI without ever reading a single one of them. Thus, the actual initial communications between Manning and Lamo -- what preceded and led to their chat -- are completely unknown. Lamo refuses to release the emails or chats other than the small chat snippets published by Wired.
Using the chat logs between Lamo and Manning -- which Lamo provided to Poulsen -- the Wired writers speculated that the Army Private trusted Lamo because he "sensed a kindred spirit in the ex-hacker." Poulsen and Zetter write that Manning confessed to being the leaker of the Apache attack video "very quickly in the exchange," and then proceeded to boast that, in addition, "he leaked a quarter-million classified embassy cables" to WikiLeaks. Very shortly after the first chat, Lamo notified federal agents of what Manning told him, proceeded to speak to Manning for the next several days while consulting with federal agents, and then learned that Manning was detained in Iraq.
* * * * *
Many of the bizarre aspects of this case, at least as conveyed by Lamo and Wired, are self-evident. Why would a 22-year-old Private in Iraq have unfettered access to 250,000 pages of diplomatic cables so sensitive that they "could do serious damage to national security?" Why would he contact a total stranger, whom he randomly found from a Twitter search, in order to "quickly" confess to acts that he knew could send him to prison for a very long time, perhaps his whole life? And why would he choose to confess over the Internet, in an unsecured, international AOL IM chat, given the obvious ease with which that could be preserved, intercepted or otherwise surveilled? These are the actions of someone either unbelievably reckless or actually eager to be caught.
All that said, this series of events isn't completely implausible. It's possible that a 22-year-old who engaged in these kinds of significant leaks, sitting in isolation in Iraq, would have a desire to unburden himself by confessing to a stranger; the psychological compulsion to confess is not uncommon (see Crime and Punishment), nor is the desire to boast of such acts. It's possible that he would have expected someone with Lamo's hacking and "journalist" background to be sympathetic to what he did and/or to feel compelled as a journalist not to run to the Government and disclose what he learns from a source. Still, the apparent ease with which Manning quickly spilled his guts in such painstaking detail over an Internet chat concerning such serious crimes -- and then proceeded to respond to Lamo's very specific and probing interrogations over days without ever once worrying that he could not trust Lamo -- is strange in the extreme.
If one assumes that this happened as the Wired version claims, what Lamo did here is despicable. He holds himself out as an "award-winning journalist" and told Manning he was one ("I did tell him that I worked as a journalist," Lamo said). Indeed, Lamo told me (though it doesn't appear in the chat logs published by Wired) that he told Manning early on that he was a journalist and thus could offer him confidentiality for everything they discussed under California's shield law. Lamo also said he told Manning that he was an ordained minister and could treat Manning's talk as a confession, which would then compel Lamo under the law to keep their discussions confidential (early on in their chats, Manning said: "I can't believe what I'm confessing to you"). In sum, Lamo explicitly led Manning to believe he could trust him and that their discussions would be confidential -- perhaps legally required to be kept confidential -- only to then report everything Manning said to the Government.
Worse, Lamo breached his own confidentiality commitments and turned informant without having the slightest indication that Manning had done anything to harm national security. Indeed, Lamo acknowledged to me that he was incapable of identifying a single fact contained in any documents leaked by Manning that would harm national security. And Manning's capacity to leak in the future was likely non-existent given that he told Lamo right away that he was "pending discharge" for "adjustment disorder," and no longer had access to any documents (Lamo: "Why does your job afford you access?" - Manning: "because i have a workstation . . . *had*").
If one believes what the chat logs claim, Manning certainly thought he was a whistle-blower acting with the noblest of motives, and probably was exactly that. And if he really is the leaker of the Apache helicopter attack video -- a video which sparked very rare and much-needed realization about the visceral truth of what our wars entail -- then he's a national hero similar to Daniel Ellsberg. Indeed, Ellsberg himself said the very same thing about Manning just yesterday on Democracy Now:
The fact is that what Lamo reports Manning is saying has a very familiar and persuasive ring to me. He reports Manning as having said that what he had read and what he was passing on were horrible -- evidence of horrible machinations by the US backdoor dealings throughout the Middle East and, in many cases, as he put it, almost crimes. And let me guess that -- he’s not a lawyer, but I'll guess that what looked to him like crimes are crimes, that he was putting out. We know that he put out, or at least it's very plausible that he put out, the videos that he claimed to Lamo. And that's enough to go on to get them interested in pursuing both him and the other.
And so, what it comes down, to me, is -- and I say throwing caution to the winds here -- is that what I've heard so far of Assange and Manning -- and I haven't met either of them -- is that they are two new heroes of mine.
To see why that's so, just review some of what Manning said about why he chose to leak, as reflected in the edited chat logs published by Wired:
Lamo: what's your endgame plan, then?. . .
Manning: well, it was forwarded to [WikiLeaks] - and god knows what happens now - hopefully worldwide discussion, debates, and reforms - if not, than [sic] we're doomed - as a species - i will officially give up on the society we have if nothing happens - the reaction to the video gave me immense hope; CNN's iReport was overwhelmed; Twitter exploded - people who saw, knew there was something wrong . . . - i want people to see the truth… regardless of who they are… because without information, you cannot make informed decisions as a public.
Manning described the incident which first made him seriously question the U.S. war in Iraq: when he was instructed to work on the case of Iraqi "insurgents" who had been detained for distributing "insurgent" literature which, when he had it translated, turned out to be nothing more than "a scholarly critique against PM Maliki":
i had an interpreter read it for me… and when i found out that it was a benign political critique titled "Where did the money go?" and following the corruption trail within the PM’s cabinet… i immediately took that information and *ran* to the officer to explain what was going on… he didn’t want to hear any of it… he told me to shut up and explain how we could assist the FPs in finding *MORE* detainees…
i had always questioned the things worked, and investigated to find the truth… but that was a point where i was a *part* of something… i was actively involved in something that i was completely against…
And he explained why the thought of selling this classified information he was leaking to a foreign power never entered his mind:
Manning: i mean what if i were someone more malicious- i could've sold to russia or china, and made bank?
Lamo: why didn’t you?
Manning: because it's public data
Lamo: i mean, the cables
Manning: it belongs in the public domain -information should be free - it belongs in the public domain - because another state would just take advantage of the information… try and get some edge - if its out in the open… it should be a public good.
That's a whistleblower in the purest form: discovering government secrets of criminal and corrupt acts and then publicizing them to the world not for profit, not to give other nations an edge, but to trigger "worldwide discussion, debates, and reforms." That's the person that Adrian Lamo informed on and risked sending to prison for an extremely long time.
Making Lamo's conduct even worse is that it appears he reported Manning for no reason other than a desire for some trivial media attention. Jacob Appelbaum, a well-known hacker of the Tor Project who has known Lamo for years, said that Lamo's "only concern" has always been "getting publicity for Adrian." Indeed, Lamo's modus operandi as a hacker was primitive hacking aimed at high-profile companies that he'd then use Poulsen to publicize. As Appelbaum put it: "if this situation really fell into Adrian's lap, his first and only thought would have been: how can I turn this to my advantage? He basically destroyed a 22-year-old's life in order to get his name mentioned on the Wired.com blog." [There are efforts underway to help secure very competent legal counsel for Manning, including a legal defense fund for him; assuming the facts are what the current narrative suggests, I intend to post more about that shortly].
None of Lamo's claims that he turned informant out of some grave concern for "national security" and "the lives of his fellow citizens" make any sense. Indeed, Lamo several months ago contributed $30 to WikiLeaks, which he's use to tout his support for whistle-blowing, and told me has has long considered himself on "the far left." Yet in the public statements he's made about what he did to Manning, he's incoherently invoked a slew of trite, right-wing justifications, denouncing Manning as a "traitor" and a "spy," while darkly insinuating that Manning provided classified information to a so-called "foreign national," meaning WikiLeaks' Assange. Lamo told me that any embarrassment to the U.S. Government could cause a loss of American lives, and that he believes anyone who breaks the law with leaks should be prosecuted. Yet he also claims to support WikiLeaks, which is run by that very same "foreign national" and which exists to enable illegal leaks.
Then there's the fact that, just in the last two weeks, Lamo's statements have been filled with countless contradictions of the type that suggests deliberate lying. Lamo told me, for instance, that Manning first contacted him with a series of emails, but told Yahoo! News that "Manning contacted him via AOL Instant Messenger 'out of the blue' on May 21." Lamo told Yahoo! "that he spelled out very clearly in his chats with Manning that he wasn't ... acting as a journalist," that it "was clear to Manning that he had taken his journalist hat off for the purposes of their conversation," and that "Manning refused" a confidentiality offer, but last night he said to me that he told Manning their conversations would have journalist-source confidentiality and that Manning never refused or rejected that. Just listen to the interview Lamo gave to me and make your own judgment about his veracity.
* * * * *
And what about Wired's role in all of this? Both WikiLeaks as well as various Internet commentators have suggested that Poulsen violated journalistic ethical rules by being complicit with Lamo in informing on Manning. I don't see any evidence for that. This is what Poulsen told me when I asked him about whether he participated in Lamo's informing on Manning:
Adrian reached out to me in late May to tell me a story about how he'd been contacted by an Army intelligence analyst who'd admitted to leaking 260,000 State Department diplomatic cables to a "foreign national." Adrian told me he had already reported the matter to the government, and was meeting the Army and FBI in person to pass on chat logs. He declined to provide independently verifiable details, or identify the intelligence analyst by name, because he said he considered the matter sensitive.
Several days passed before he was willing to give me the chat logs under embargo. I got them on May 27. That's when I learned Manning's name and the full details of his claims to Adrian. . . . If you're asking if I informed on Manning or anyone else, the answer is no, and the question is insulting.
At the time when Lamo was conspiring with federal agents to induce Manning into making incriminating statements, Poulsen, by his own account, was aware that this was taking place, but there's no indication he participated in any way with Lamo. What is true, though, is that Lamo gave Wired the full, unedited version of his chat logs with Manning, but Wired published only extremely edited samplings of it. This is what Poulsen told me when I asked if Lamo gave him all of the chat logs:
He did, but I don't think we'll be publishing more any time soon. The remainder is either Manning discussing personal matters that aren't clearly related to his arrest, or apparently sensitive government information that I'm not throwing up without vetting first.
This part of Wired's conduct deserves a lot more attention. First, in his interview with me, Lamo claimed that all sorts of things took place in the discussion between him and Manning that are (a) extremely relevant to what happened, (b) have nothing to do with Manning's personal issues or sensitive national security secrets, and yet (c) are nowhere to be found in the chat logs published by Wired. That means either that Lamo is lying about what was said or Wired is concealing highly relevant aspects of their discussions. Included among that is Manning's explanation about how he found Lamo and why he contacted him, Manning's alleged claim that his "intention was to cripple the United States' foreign relations for the foreseeable future," and discussions they had about the capacity in which they were speaking.
Second, one can't help but note the irony that two hackers-turned-journalists -- Poulsen and Lamo -- are now the self-anointed guardians of America's national security, the former concealing secrets he learned as a journalist on vague national security grounds and the latter turning informant by invoking the most extreme, right-wing platitudes about "traitors" and "spies" and decrees that his actions were necessary to "save American lives."
Third, Wired should either publish all of the chat logs, or be far more diligent about withholding only those parts which truly pertain only to Manning's private and personal matters and/or which would reveal national security secrets. Or they should have a respected third party review the parts they have concealed to determine if there is any justification for that. At least if one believes Lamo's claims, there are clearly relevant parts of those chats which Wired continues to conceal.
Given Poulsen's mutually beneficial and multi-layered relationship with Lamo, they have far more than a standard journalist-source relationship. None of Poulsen's articles about the highly controversial Lamo is ever even remotely critical of him, in any sense of the word. From the start, there were countless bizarre aspects to Lamo's story which Poulsen never examined or explored, at least not when writing about any of this. I see no reason to doubt Poulsen's integrity or good faith. Still, in light of the magnitude of this story on several levels and his long relationship with Lamo, Kevin Poulsen should not be single-handedly deciding what the public is and isn't permitted to know about the Lamo-Manning interaction.
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The reason this story matters so much -- aside from the fact that it may be the case that a truly heroic, 22-year-old whistle-blower is facing an extremely lengthy prison term -- is the unique and incomparably valuable function WikiLeaks is fulfilling. Even before the Apache helicopter leak, I wrote at length about why they are so vital, and won't repeat all of that here. Suffice to say, there are very few entities, if there are any, which pose as much of a threat to the ability of governmental and corporate elites to shroud their corrupt conduct behind an extreme wall of secrecy.
What makes WikiLeaks particularly threatening to the most powerful factions is that they cannot control it. Even when whistle-blowers in the past have leaked serious corruption and criminal conduct to perfectly good journalists at the nation's largest corporate media outlets, government officials could control how the information was disclosed. When the NYT learned in 2004 that the Bush administration was illegally eavesdropping on Americans without warrants, George Bush summoned the paper's Publisher and Executive Editor to the Oval Office, demanded that the story not be published, and the paper complied by sitting on it for a full year until after Bush was safely re-elected. When The Washington Post's Dana Priest learned that the CIA was maintaining a network of secret prisons -- black sites -- she honored the request of "senior U.S. officials" not to identify the countries where those prisons were located so as to not disrupt the U.S.'s ability to continue to use those countries for such projects.
Both WikiLeaks and Manning have stated that The Washington Post's David Finkel, when writing his book on Iraq two years ago, had possession of the Apache helicopter video but never released it to the public (Manning: "Washington Post sat on the video … David Finkel acquired a copy while embedded out here"). As Columbia Journalism Review reported, both the Post and Finkel were quite coy and evasive in addressing that claim, pointedly insisting that "the Post" had never possessed that video while refusing to say whether Finkel did. The same thing happened when, on the same day, I called Finkel to ask him about WikiLeaks' claim that they possessed but never released that video. He very curtly told me, using careful legalistic language, that "the Post never had the video," but before I could ask whether Finkel himself did, he abruptly told me he couldn't talk anymore and had nothing else to say, and then hung up on me. My inquiries to the Post were met with a pro forma response that "The Washington Post did not have the video, nor did we sit on anything," but these Journalistic Crusaders for Transparency refused to answer my question as to whether Finkel himself did.
By stark contrast, WikiLeaks isn't interested in helping governments, militaries and corporations keep secrets. They're interested in the opposite: forcing transparency on institutions which conduct the vast, vast bulk of their substantive conduct in the dark. They're not susceptible to pressure from political and corporate officials; rather, they want to hold them accountable. That's what makes WikiLeaks so uniquely threatening to elite institutions, and anyone who doubts that should simply read the 2008 Pentagon Report discussing ways to destroy it, or review the Obama administration's unprecedented and rapidly escalating war on whistle-blowers generally.
Any rational person would have to acknowledge that government secrecy in rare cases is justifiable and that it's possible for leaks of legitimate secrets to result in serious harm. I'm not aware of a single instance where any leak from WikiLeaks has done so, but it's certainly possible that, at some point, it might. But right now, the scales are tipped so far in the other direction -- toward excessive, all-consuming secrecy -- that the far greater danger comes from allowing that to fester and grow even more. It's not even a close call. Any efforts to subvert that secrecy cult are commendable in the extreme, and nobody is doing that as effectively as WikiLeaks (and their value is not confined to leaking, as they just inspired a serious effort to turn Iceland into a worldwide haven for investigative journalism and anonymous whistle-blowers).
This Manning detention -- whether it was by design or just exploited opportunistically -- is being used to depict WikiLeaks as a serious national security threat and associations with it as dangerous and subversive. Just in the last week alone, several people have expressed to me fears that supporting or otherwise enabling WikiLeaks could subject them to liability or worse. There's no reason to believe that's true, but given the powers the U.S. Government claims -- lawless detentions, renditions, assassinations even of American citizens -- that's the climate of intimidation that has been created. This latest incident is clearly being used to impede WikiLeaks' vital function of checking powerful factions and imposing transparency, and for that reason alone, this is an extremely serious case that merits substantial scrutiny, along with genuine skepticism to understand what happened.
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My one-hour discussion with Lamo last night can be heard by clicking PLAY on the recorders below. It is in two segments (the first roughly 40 minutes, the second roughly 20) because Lamo requested at one point that we go off the record, which we did for 1 minute or so to discuss the parts of Manning's chat that Lamo claims are too personal to publish (Lamo spoke only in generalities about that and I learned nothing specific). The only other part that is edited out is the first two minutes or so of the discussion, before the interview begins, where Lamo for some reason insists that I respond to a Tweet of his before we begin, which I then did.
