Political Irony

Glenn Greenwald has a disturbing report concerning WikiLeaks, Bank of America, and the merger of corporate and government power in this country. I’m loathe to use the overused word “fascism” but the textbook definition of that particular f-word is the alignment of the government and economy of a country around corporatist interests.

Just in case you haven’t been following along, after WikiLeaks published US diplomatic cables (the release of which likely played no small part in the recent revolutions in Tunisia and Egypt) they then threatened to release highly damaging reports on a major American bank — widely believed to be the Bank of America. Meanwhile, several corporations, including Paypal, MasterCard, Visa, and Amazon, likely under pressure from the US government, terminated services to WikiLeaks in an effort to knee-cap them. In response, a loose-knit group of hackers called Anonymous carried out cyber attacks against those corporations. Then, last week, a top executive at computer security firm HBGary Federal, boasted that his firm had infiltrated Anonymous and was going to expose them. In retaliation, Anonymous hacked virtually every computer at HBGary Federal and published 50,000 of their emails online.

What ties this all together is that some of the emails published detail a report prepared by HBGary Federal that propose countermeasures against organizations and individuals that support WikiLeaks. Many of these countermeasures appear to be serious crimes. But even worse, they expose to a disturbing amount of lawlessness being carried out by the major institutions — both private and public, and often in collaboration — in our country.

Here’s a quick excerpt from Greenwald’s report, but the whole thing is definitely a must read:

But the real issue highlighted by this episode is just how lawless and unrestrained is the unified axis of government and corporate power. … The exemption from the rule of law has been fully transferred from the highest level political elites to their counterparts in the private sector. “Law” is something used to restrain ordinary Americans and especially those who oppose this consortium of government and corporate power, but it manifestly does not apply to restrain these elites. Just consider one amazing example illustrating how this works.

After Anonymous imposed some very minimal cyber disruptions on Paypal, Master Card and Amazon, the DOJ flamboyantly vowed to arrest the culprits, and several individuals were just arrested as part of those attacks. But weeks earlier, a far more damaging and serious cyber-attack was launched at WikiLeaks, knocking them offline. Those attacks were sophisticated and dangerous. Whoever did that was quite likely part of either a government agency or a large private entity acting at its behest. Yet the DOJ has never announced any investigation into those attacks or vowed to apprehend the culprits, and it’s impossible to imagine that ever happening.

Why? Because crimes carried out that serve the Government’s agenda and target its opponents are permitted and even encouraged; cyber-attacks are “crimes” only when undertaken by those whom the Government dislikes, but are perfectly permissible when the Government itself or those with a sympathetic agenda unleash them. Whoever launched those cyber attacks at WikiLeaks (whether government or private actors) had no more legal right to do so than Anonymous, but only the latter will be prosecuted.

UPDATE: Forbes magazine has an interesting update on all this. Interesting quote in an email from HBGary Federal CEO: “I follow one law. Mine.”

UPDATE 2: More from Forbes. “Rarely in the history of the cybersecurity industry has a company become so toxic so quickly as HBGary Federal. Over the last week, many of the firm’s closest partners and largest clients have cut ties with the Sacramento startup. And now it’s cancelled all public appearances by its executives at the industry’s biggest conference in the hopes of ducking a scandal that seems to grow daily as more of its questionable practices come to light.”

© Joel Pett

Is unbridled democracy really that scary to the US government?

A new poll from CNN shows that the most important thing they want in a presidential candidate in 2012 is someone who can defeat Obama — even if that candidate disagrees with them on major issues and ideology.

I guess I’m happy that Republicans are taking a slight break from ideology, but only so they can cement their reputation as the Party of No.

In 2003, Boeing decided to use a very aggressive outsourcing strategy in order to slash the cost of developing their new 787 Dreamliner.

But last month, the Boeing Commercial Airplanes chief admitted that this strategy backfired completely — outsourcing cost far more money than it saved, and led to a three year delay in the release of the 787. “We spent a lot more money in trying to recover than we ever would have spent if we’d tried to keep the key technologies closer to home.” Wall Street analysts have estimated that this bad move cost the company between $12 billion and $18 billion dollars, on top of the $5 billion the plane was originally predicted to cost.

What I find ironic about this is that in 1997, Boeing was able to acquire their major competitor, airplane manufacturer McDonnell Douglas, because Douglas had themselves tried their own disastrous outsourcing strategy. In fact, one of the Senior Technical Fellows from Douglas had warned Boeing in 2001 not to go down the outsourcing path that had led Douglas to virtual obsolescence by the mid-1990s, and predicting that outsourcing would cause massive additional costs.

But Boeing didn’t listen, because they were too busy chasing after a new accounting measure called RONA — return on net assets — an idea they acquired from the close-to-defunct Douglas. The RONA idea is that the less actual work you do per dollar of profit, the better. Taken to its extreme, you could maximize RONA by outsourcing everything other than a 25 cent Boeing decal that you would slap on the nose of the finished airplane.

The problem, of course, is that you lose all control over the airplane itself and increase risks when outsourcing partners are unable to perform. And as you lay off your employees, you lose your core competencies. You are in effect turning your product into a commodity, competing on price alone. As most businesses recognize, this is a very bad situation to be in. But when the outsourcing ends up costing you more money, it is a double whammy.

Boeing has now learned this lesson twice. Will other companies need to make the same mistakes? I hope not.