Companies With Ties to Israel Wiretap the U.S. for the NSA
James Bamford: Inside the NSA’s Largest Secret Domestic Spy Center
James Bamford on NSA’s un democratic Surveillance
James Bamford Compares Obama Spying On ALL Americans To “East Germany During The Cold War”
NSA Spying on Americans Isn’t New – Everything Changed after 9/11
James Bamford on NSA Secrets, Keith Alexander’s Influence &Massive Growth of Surveillance, Cyberwar
NSA Chronicler James Bamford on Maddow 06/12/2013
NSA whistleblower William Binney Keynote at HOPE Number Nine
Ron Paul on Edward Snowden, 4th Amendment, Liberty, Security, Truth
Rand Paul:Fourth Amendment Restoration Act of 2013
Full Show 6/10/13: The Rise of the Security State
The Secret Surveillance State – You Can’t Send a FOIA to Booz Allen! P1
The Secret Surveillance State – The Secret FISA Court P2
NSA Whistleblower Thomas Drake Prevails in Unprecedented Obama Admin Crackdown
US internet spying scandal: President Obama accused of using East German Stasi methods
“U.S. Government Using American-Style Stasi Methods” German MEP
People & Power – Germany’s records of repression
Stasi Files: The Lives of Others | Journal Reporter
The Lost World of Communism (Part 1)
Nova: The Spy Factory Full Video
Background Articles and Videos
Stellar Wind
Stellar Wind was the open secret code name for four surveillance programs by the United States National Security Agency (NSA) during the presidency of George W. Bush and revealed by Thomas Tamm to The New York Times reporters James Risen and Eric Lichtblau.[1] The operation was approved by President George W. Bush shortly after the September 11 attacks in 2001.[2] Stellar Wind was succeeded during the presidency of Barack Obama by four major lines of intelligence collection in the territorial United States, together capable of spanning the full range of modern telecommunications.[3]
The program’s activities involved data mining of a large database of the communications of American citizens, including e-mail communications, phone conversations, financial transactions, and Internet activity.[1] William Binney, a retired Technical Leader with the NSA, discussed some of the architectural and operational elements of the program at the 2012 Chaos Communication Congress.[4]
There were internal disputes within the Justice Department about the legality of the program, because data are collected for large numbers of people, not just the subjects of Foreign Intelligence Surveillance Act (FISA) warrants.[4]
During the Bush Administration, the Stellar Wind cases were referred to by FBI agents as “pizza cases” because many seemingly suspicious cases turned out to be food takeout orders. According to Mueller, approximately 99 percent of the cases led nowhere, but “it’s that other 1% that we’ve got to be concerned about”.[2] One of the known uses of these data were the creation of suspicious activity reports, or “SARS”, about people suspected of terrorist activities. It was one of these reports that revealed former New York governor Eliot Spitzer’s use of prostitutes, even though he was not suspected of terrorist activities.[1]
In March 2012 Wired magazine published “The NSA Is Building the Country’s Biggest Spy Center (Watch What You Say)” talking about a vast new NSA facility in Utah and says “For the first time, a former NSA official has gone on the record to describe the program, codenamed Stellar Wind, in detail,” naming the official William Binney, a former NSA code breaker. Binney went on to say that the NSA had highly secured rooms that tap into major switches, and satellite communications at both AT&T and Verizon.[5] The article suggested that the otherwise dispatched Stellar Wind is actually an active program.
PRISM is a clandestine national security electronic surveillance program operated by the United States National Security Agency (NSA) since 2007.[1][2][3][Notes 1]PRISM is a government codename for a data collection effort known officially as US-984XN.[8][9] It is operated under the supervision of the United States Foreign Intelligence Surveillance Court pursuant to the Foreign Intelligence Surveillance Act (FISA).[10] The existence of the program was leaked by NSA contractor Edward Snowden and published by The Guardian and The Washington Post on June 6, 2013.
A document included in the leak indicated that the PRISM SIGAD was “the number one source of raw intelligence used for NSA analytic reports.”[11] The President’s Daily Brief, an all-source intelligence product, cited PRISM data as a source in 1,477 items in 2012.[12] The leaked information came to light one day after the revelation that the United States Foreign Intelligence Surveillance Court had been requiring the telecommunications company Verizon to turn over to the NSA logs tracking all of its customers’ telephone calls on an ongoing daily basis.[13][14]
According to the Director of National Intelligence James Clapper, PRISM cannot be used to intentionally target any Americans or anyone in the United States. Clapper said a special court, Congress, and the executive branch oversee the program and extensive procedures ensure the acquisition, retention, and dissemination of data accidentally collected about Americans is kept to a minimum.[15] Clapper issued a statement and “fact sheet”[16] to correct what he characterized as “significant misimpressions” in articles by The Washington Post and The Guardian newspapers.[17]
History
Slide showing that much of the world’s communications flow through the US
Details of information collected via PRISM
PRISM is a “Special Source Operation” in the tradition of NSA’s intelligence alliances with as many as 100 trusted U.S. companies since the 1970s.[1] A prior program, the Terrorist Surveillance Program, was implemented in the wake of the September 11 attacks under the George W. Bush Administration but was widely criticized and had its legality questioned, because it was conducted without approval of the Foreign Intelligence Surveillance Court (FISC).[18][19][20][21] PRISM was authorized by an order of the FISC.[11] Its creation was enabled by the Protect America Act of 2007 under President Bush and the FISA Amendments Act of 2008, which legally immunized private companies that cooperated voluntarily with US intelligence collection and was renewed by Congress under President Obama in 2012 for five years until December 2017.[2][22] According to The Register, the FISA Amendments Act of 2008 “specifically authorizes intelligence agencies to monitor the phone, email, and other communications of U.S. citizens for up to a week without obtaining a warrant” when one of the parties is outside the U.S.[22]
PRISM was first publicly revealed on June 6, 2013, after classified documents about the program were leaked to The Washington Post and The Guardian by American Edward Snowden.[2][1] The leaked documents included 41 PowerPoint slides, four of which were published in news articles.[1][2] The documents identified several technology companies as participants in the PRISM program, including (date of joining PRISM in parentheses) Microsoft (2007), Yahoo! (2008), Google (2009), Facebook (2009), Paltalk (2009), YouTube (2010), AOL (2011), Skype (2011), and Apple (2012).[23] The speaker’s notes in the briefing document reviewed by The Washington Post indicated that “98 percent of PRISM production is based on Yahoo, Google and Microsoft.”[1]
The slide presentation stated that much of the world’s electronic communications pass through the United States, because electronic communications data tend to follow the least expensive route rather than the most physically direct route, and the bulk of the world’s internet infrastructure is based in the United States.[11] The presentation noted that these facts provide United States intelligence analysts with opportunities for intercepting the communications of foreign targets as their electronic data pass into or through the United States.[2][11]
According to The Washington Post, the intelligence analysts search PRISM data using terms intended to identify suspicious communications of targets whom the analysts suspect with at least 51 percent confidence to not be United States citizens, but in the process, communication data of some United States citizens are also collected unintentionally.[1] Training materials for analysts tell them that while they should periodically report such accidental collection of non-foreign United States data, “it’s nothing to worry about.”[1]
Response from companies
The original Washington Post and Guardian articles reporting on PRISM noted that one of the leaked briefing documents said PRISM involves collection of data “directly from the servers” of several major internet services providers.[2][1]
Initial Public Statements
Corporate executives of several companies identified in the leaked documents told The Guardian that they had no knowledge of the PRISM program in particular and also denied making information available to the government on the scale alleged by news reports.[2][24] Statements of several of the companies named in the leaked documents were reported by TechCrunch and The Washington Post as follows:[25][26]
Slide listing companies and the date that PRISM collection began
Microsoft: “We provide customer data only when we receive a legally binding order or subpoena to do so, and never on a voluntary basis. In addition we only ever comply with orders for requests about specific accounts or identifiers. If the government has a broader voluntary national security program to gather customer data we don’t participate in it.”[25]
Yahoo!: “Yahoo! takes users’ privacy very seriously. We do not provide the government with direct access to our servers, systems, or network.”[25] “Of the hundreds of millions of users we serve, an infinitesimal percentage will ever be the subject of a government data collection directive.”[26]
Facebook: “We do not provide any government organization with direct access to Facebook servers. When Facebook is asked for data or information about specific individuals, we carefully scrutinize any such request for compliance with all applicable laws, and provide information only to the extent required by law.”[25]
Google: “Google cares deeply about the security of our users’ data. We disclose user data to government in accordance with the law, and we review all such requests carefully. From time to time, people allege that we have created a government ‘back door’ into our systems, but Google does not have a backdoor for the government to access private user data.”[25] “[A]ny suggestion that Google is disclosing information about our users’ Internet activity on such a scale is completely false.”[26]
Apple: “We have never heard of PRISM. We do not provide any government agency with direct access to our servers, and any government agency requesting customer data must get a court order.”[27]
Dropbox: “We’ve seen reports that Dropbox might be asked to participate in a government program called PRISM. We are not part of any such program and remain committed to protecting our users’ privacy.”[25]
In response to the technology companies’ denials of the NSA being able to directly access the companies’ servers, The New York Times reported that sources had stated the NSA was gathering the surveillance data from the companies using other technical means in response to court orders for specific sets of data.[13]The Washington Post suggested, “It is possible that the conflict between the PRISM slides and the company spokesmen is the result of imprecision on the part of the NSA author. In another classified report obtained by The Post, the arrangement is described as allowing ‘collection managers [to send] content tasking instructions directly to equipment installed at company-controlled locations,’ rather than directly to company servers.”[1] “[I]n context, ‘direct’ is more likely to mean that the NSA is receiving data sent to them deliberately by the tech companies, as opposed to intercepting communications as they’re transmitted to some other destination.[26]
“If these companies received an order under the FISA amendments act, they are forbidden by law from disclosing having received the order and disclosing any information about the order at all,” Mark Rumold, staff attorney at the Electronic Frontier Foundation, told ABC News.[28]
Slide showing two different sources of NSA data collection. The first source the fiber optic cables of the internet handled by the Upstream program and the second source the servers of major internet companies handled by PRISM.[29]
On May 28, 2013, Google was ordered by United States District Court Judge Susan Illston to comply with a National Security Letter issued by the FBI to provide user data without a warrant.[30] Kurt Opsahl, a senior staff attorney at the Electronic Frontier Foundation, in an interview with VentureBeat said, “I certainly appreciate that Google put out a transparency report, but it appears that the transparency didn’t include this. I wouldn’t be surprised if they were subject to a gag order.”[31]
The New York Times reported on June 7, 2013, that “Twitter declined to make it easier for the government. But other companies were more compliant, according to people briefed on the negotiations.”[32] The other companies held discussions with national security personnel on how to make data available more efficiently and securely.[32] In some cases, these companies made modifications to their systems in support of the intelligence collection effort.[32] The dialogues have continued in recent months, as General Martin Dempsey, the chairman of the Joint Chiefs of Staff, has met with executives including those at Facebook, Microsoft, Google and Intel.[32] These details on the discussions provide insight into the disparity between initial descriptions of the government program including a training slide which states “Collection directly from the servers”[29] and the companies’ denials.[32]
While providing data in response to a legitimate FISA request approved by FISC is a legal requirement, modifying systems to make it easier for the government to collect the data is not. This is why Twitter could legally decline to provide an enhanced mechanism for data transmission.[32] Other than Twitter, the companies were effectively asked to construct a locked mailbox and provide the key to the government, people briefed on the negotiations said.[32] Facebook, for instance, built such a system for requesting and sharing the information.[32] Google does not provide a lockbox system, but instead transmits required data by hand delivery or secure FTP.[33]
Post-PRISM Transparency Reports
In response to the publicity surrounding media reports of data-sharing, several companies requested permission to reveal more public information about the nature and scope of information provided in response to National Security requests.
On June 14, 2013, Facebook reported that the U.S. Government had authorized the communication of “about these numbers in aggregate, and as a range.” In a press release posted to their web site, Facebook reported, “For the six months ending December 31, 2012, the total number of user-data requests Facebook received from any and all government entities in the U.S. (including local, state, and federal, and including criminal and national security-related requests) – was between 9,000 and 10,000.” Facebook further reported that the requests impacted “between 18,000 and 19,000″ user accounts, a “tiny fraction of one percent” of more than 1.1 billion active user accounts.[34]
Microsoft reported that for the same period, it received “between 6,000 and 7,000 criminal and national security warrants, subpoenas and orders affecting between 31,000 and 32,000 consumer accounts from U.S. governmental entities (including local, state and federal)” which impacted “a tiny fraction of Microsoft’s global customer base”.[35]
Google issued a statement criticizing the requirement that data be reported in aggregated form, stating that lumping national security requests with criminal request data would be “a step backwards” from its previous, more detailed practices on its site transparency report. The company said that it would continue to seek government permission to publish the number and extent of FISA requests.[36]
Response from United States government
Executive branch
Shortly after publication of the reports by The Guardian and The Washington Post, the United States Director of National Intelligence, James Clapper, on June 7 released a statement confirming that for nearly six years the government of the United States had been using large internet services companies such as Google and Facebook to collect information on foreigners outside the United States as a defense against national security threats.[13] The statement read in part, “The Guardian and The Washington Post articles refer to collection of communications pursuant to Section 702 of the Foreign Intelligence Surveillance Act. They contain numerous inaccuracies.”[37] He went on to say, “Section 702 is a provision of FISA that is designed to facilitate the acquisition of foreign intelligence information concerning non-U.S. persons located outside the United States. It cannot be used to intentionally target any U.S. citizen, any other U.S. person, or anyone located within the United States.”[37] Clapper concluded his statement by stating “The unauthorized disclosure of information about this important and entirely legal program is reprehensible and risks important protections for the security of Americans.”[37] On March 12, 2013, Clapper had told the United States Senate Select Committee on Intelligence that the NSA does “not wittingly” collect any type of data on millions or hundreds of millions of Americans.[38] In an NBC News interview, Clapper said he answered Senator Wyden’s question in the “least untruthful manner by saying no”.[39]
Clapper also stated that “the NSA collects the phone data in broad swaths, because collecting it (in) a narrow fashion would make it harder to identify terrorism-related communications. The information collected lets the government, over time, make connections about terrorist activities. The program doesn’t let the U.S. listen to people’s calls, but only includes information like call length and telephone numbers dialed.”[15]
On June 8, 2013, Clapper said “the surveillance activities published in The Guardian and The Washington Post are lawful and conducted under authorities widely known and discussed, and fully debated and authorized by Congress.”[40][10] The fact sheet described PRISM as “an internal government computer system used to facilitate the government’s statutorily authorized collection of foreign intelligence information from electronic communication service providers under court supervision, as authorized by Section 702 of the Foreign Intelligence Surveillance Act (FISA) (50 U.S.C. § 1881a).”[10]
The National Intelligence fact sheet further stated that “the United States Government does not unilaterally obtain information from the servers of U.S. electronic communication service providers. All such information is obtained with FISA Court approval and with the knowledge of the provider based upon a written directive from the Attorney General and the Director of National Intelligence.” It said that the Attorney General provides FISA Court rulings and semi-annual reports about PRISM activities to Congress, “provid[ing] an unprecedented degree of accountability and transparency.”[10]
The President of the United States, Barack Obama, said on June 7 “What you’ve got is two programs that were originally authorized by Congress, have been repeatedly authorized by Congress. Bipartisan majorities have approved them. Congress is continually briefed on how these are conducted. There are a whole range of safeguards involved. And federal judges are overseeing the entire program throughout.”[41] He also said, “You can’t have 100 percent security and then also have 100 percent privacy and zero inconvenience. You know, we’re going to have to make some choices as a society.”[41]
In separate statements, senior (not mentioned by name in source) Obama administration officials said that Congress had been briefed 13 times on the programs since 2009.[42]
Legislative branch
In contrast to their swift and forceful reactions the previous day to allegations that the government had been conducting surveillance of United States citizens’ telephone records, Congressional leaders initially had little to say about the PRISM program the day after leaked information about the program was published. Several lawmakers declined to discuss PRISM, citing its top-secret classification,[43] and others said that they had not been aware of the program.[44] After statements had been released by the President and the Director of National Intelligence, some lawmakers began to comment:
Senator John McCain (R-AZ)
June 9 “We passed the Patriot Act. We passed specific provisions of the act that allowed for this program to take place, to be enacted in operation,”[45]
Senator Dianne Feinstein (D-CA), chair of the Senate Intelligence Committee
June 9 “These programs are within the law”, “part of our obligation is keeping Americans safe”, “Human intelligence isn’t going to do it”.[46]
June 9 “Here’s the rub: the instances where this has produced good — has disrupted plots, prevented terrorist attacks, is all classified, that’s what’s so hard about this.”[47]
June 11 “It went fine…we asked him[ Keith Alexander ] to declassify things because it would be helpful (for people and lawmakers to better understand the intelligence programs).” “I’ve just got to see if the information gets declassified. I’m sure people will find it very interesting.”[48]
Senator Susan Collins (R-ME), member of Senate Intelligence Committee and past member of Homeland Security Committee
June 11 “I had, along with Joe Lieberman, a monthly threat briefing, but I did not have access to this highly compartmentalized information” and “How can you ask when you don’t know the program exists?”[49]
Representative John Boehner (R-OH), Speaker of the House of Representatives
June 11 “He’s a traitor”[50] (referring to Edward Snowden)
Representative Jim Sensenbrenner (R-WI), principal sponsor of the Patriot Act
June 9, “This is well beyond what the Patriot Act allows.”[51] “President Obama’s claim that ‘this is the most transparent administration in history’ has once again proven false. In fact, it appears that no administration has ever peered more closely or intimately into the lives of innocent Americans.”[51]
Representative Mike Rogers (R-MI), a Chairman of the Permanent Select Committee on Intelligence.
June 9 “One of the things that we’re charged with is keeping America safe and keeping our civil liberties and privacy intact. I think we have done both in this particular case,”[46]
June 9 “Within the last few years this program was used to stop a program, excuse me, to stop a terrorist attack in the United States we know that. It’s, it’s, it’s important, it fills in a little seam that we have and it’s used to make sure that there is not an international nexus to any terrorism event that they may believe is ongoing in the United States. So in that regard it is a very valuable thing,”[52]
Senator Mark Udall (D-CO)
June 9 “I don’t think the American public knows the extent or knew the extent to which they were being surveilled and their data was being collected.” “I think we ought to reopen the Patriot Act and put some limits on the amount of data that the National Security (Agency) is collecting,” “It ought to remain sacred, and there’s got to be a balance here. That is what I’m aiming for. Let’s have the debate, let’s be transparent, let’s open this up”.[46]
Representative Todd Rokita (R-IN)
June 10 “We have no idea when they [ FISA ] meet, we have no idea what their judgments are”,[53]
Senator Rand Paul (R-KY)
June 6 “When the Senate rushed through a last-minute extension of the FISA Amendments Act late last year, I insisted on a vote on my amendment (SA 3436) to require stronger protections on business records and prohibiting the kind of data-mining this case has revealed. Just last month, I introduced S.1037, the Fourth Amendment Preservation and Protection Act,”[54]
June 9 “I’m going to be seeing if I can challenge this at the Supreme Court level. I’m going to be asking the Internet providers and all of the phone companies: ask your customers to join me in a class-action lawsuit.”[45]
Representative Luis Gutierrez (D-IL)
June 9 “We will be receiving secret briefings and we will be asking, I know I’m going to be asking to get more information. I want to make sure that what they’re doing is harvesting information that is necessary to keep us safe and not simply going into everybody’s private telephone conversations and Facebook and communications. I mean one of the, you know the terrorists win when you debilitate freedom of expression and privacy.”[52]
Judicial branch
The Foreign Intelligence Surveillance Court (FISC) has not acknowledged, denied or confirmed any involvement in the PRISM program at this time. It has not issued any press statement or release relating to the current situation and uncertainty.
Applicable law and practice
On June 8, 2013, the Director of National Intelligence issued a fact sheet stating that PRISM “is not an undisclosed collection or data mining program”, but rather computer software used to facilitate the collection of foreign intelligence information “under court supervision, as authorized by Section 702 of the Foreign Intelligence Surveillance Act (FISA) (50 U.S.C. § 1881a).”[10] Section 702 provides that “the Attorney General [A.G.] and the Director of National Intelligence [DNI] may authorize jointly, for a period of up to 1 year from the effective date of the authorization, the targeting of persons reasonably believed to be located outside the United States to acquire foreign intelligence information.”[55] In order to authorize the targeting, the A.G. and DNI need to get an order from the Foreign Intelligence Surveillance Court (FISC) pursuant to Section 702 or certify that “intelligence important to the national security of the United States may be lost or not timely acquired and time does not permit the issuance of an order.”[55] When asking for an order, the A.G. and DNI must certify to FISC that “a significant purpose of the acquisition is to obtain foreign intelligence information.”[55] They do not need to specify which facilities or property that the targeting will be directed at.[55]
After getting a FISC order or determining that there are emergency circumstances, the A.G. and DNI can direct an electronic communication service provider to give them access to information or facilities to carry out the targeting and keep the targeting secret.[55] The provider then has the option to: (1) comply with the directive; (2) reject it; or (3) challenge it to FISC.
If the provider complies with the directive, it is released from liability to its users for providing the information and reimbursed for the cost of providing it.[55]
If the provider rejects the directive, the A.G. may request an order from FISC to enforce it.[55] A provider that fails to comply with FISC’s order can be punished with contempt of court.[55]
Finally, a provider can petition FISC to reject the directive.[55] In case FISC denies the petition and orders the provider to comply with the directive, the provider risks contempt of court if it refuses to comply with FISC’s order.[55] The provider can appeal FISC’s denial to the Foreign Intelligence Surveillance Court of Review and then appeal the Court of Review’s decision to the Supreme Court by a writ of certiorari for review under seal.[55]
The Senate Select Committee on Intelligence and the FISA Courts had been put in place to oversee intelligence operations in the period after the death of J. Edgar Hoover. Beverly Gage of Slate said, “When they were created, these new mechanisms were supposed to stop the kinds of abuses that men like Hoover had engineered. Instead, it now looks as if they have come to function as rubber stamps for the expansive ambitions of the intelligence community. J. Edgar Hoover no longer rules Washington, but it turns out we didn’t need him anyway.”[56]
Involvement of other countries
Australia
The Australian government has said it will investigate the impact of the PRISM program and the use of the Pine Gap surveillance facility on the privacy of Australian citizens.[57]
Canada
Canada’s national cryptologic agency, the Communications Security Establishment, said that commenting on PRISM “would undermine CSE’s ability to carry out its mandate”. Privacy Commissioner Jennifer Stoddart lamented Canada’s standards when it comes to protecting personal online privacy stating “We have fallen too far behind,” Stoddart wrote in her report. “While other nations’ data protection authorities have the legal power to make binding orders, levy hefty fines and take meaningful action in the event of serious data breaches, we are restricted to a ‘soft’ approach: persuasion, encouragement and, at the most, the potential to publish the names of transgressors in the public interest.” And, “when push comes to shove,” Stoddart wrote, “short of a costly and time-consuming court battle, we have no power to enforce our recommendations.”[58]
Germany
Germany did not receive any raw PRISM data, according to a Reuters report.[59]
Israel
Israeli newspaper Calcalist discussed[60] the Business Insider article[61] about the possible involvement of technologies from two secretive Israeli companies in the PRISM program – Verint Systems and Narus.
New Zealand
In New Zealand, University of Otago information science Associate Professor Hank Wolfe said that “under what was unofficially known as the Five Eyes Alliance, New Zealand and other governments, including the United States, Australia, Canada, and Britain, dealt with internal spying by saying they didn’t do it. But they have all the partners doing it for them and then they share all the information.”[62]
United Kingdom
In the United Kingdom, Government Communications Headquarters (GCHQ) has had access to the PRISM program on or before June 2010 and wrote 197 reports with it in 2012 alone. PRISM may have allowed GCHQ to circumvent the formal legal process required to seek personal material.[63][64]
Domestic response
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The New York Times editorial board charged that the Obama administration “has now lost all credibility on this issue,”[65] and lamented that “for years, members of Congress ignored evidence that domestic intelligence-gathering had grown beyond their control, and, even now, few seem disturbed to learn that every detail about the public’s calling and texting habits now reside in a N.S.A. database.”[66]
Republican and former member of Congress Ron Paul said, “We should be thankful for individuals like Edward Snowden and Glenn Greenwald who see injustice being carried out by their own government and speak out, despite the risk…. They have done a great service to the American people by exposing the truth about what our government is doing in secret.”[67] Paul denounced the government’s secret surveillance program: “The government does not need to know more about what we are doing…. We need to know more about what the government is doing.”[67] He called Congress “derelict in giving that much power to the government,” and said that had he been elected president, he would have ordered searches only when there was probable cause of a crime having been committed, which he said was not how the PRISM program was being operated.[68]
In response to Obama administration arguments that it could stop terrorism in the cases of Najibullah Zazi and David Headley, Ed Pilkington and Nicholas Watt of The Guardian said in regards to the role of PRISM and Boundless Informant interviews with parties involved in the Zazi scheme and court documents lodged in the United States and the United Kingdom indicated that “conventional” surveillance methods such as “old-fashioned tip-offs” of the British intelligence services initiated the investigation into the Zazi case.[69] An anonymous former CIA agent said that in regards to the Headley case, “That’s nonsense. It played no role at all in the Headley case. That’s not the way it happened at all.”[69] Pilkington and Watt concluded that the data-mining programs “played a relatively minor role in the interception of the two plots.”[69] Michael Daly of The Daily Beast stated that even though Tamerlan Tsarnaev had visited Inspire and even though Russian intelligence officials alerted U.S. intelligence officials about Tsarnaev, PRISM did not prevent him from carrying out the Boston bombings, and that the initial evidence implicating him came from his brother Dzhokhar Tsarnaev and not from federal intelligence. In addition Daly pointed to the fact that Faisal Shahzad visited Inspire but that federal authorities did not stop his attempted terrorist plot. Daly concluded “The problem is not just what the National Security Agency is gathering at the risk of our privacy but what it is apparently unable to monitor at the risk of our safety.”[70] In addition, political commentator Bill O’Reilly criticized the government, saying that PRISM did not stop the Boston bombings.[71]
In a blog post, David Simon, the creator of The Wire, compared the NSA’s programs, including PRISM, to a 1980s effort by the City of Baltimore to add dialed number recorders to all pay phones to know which individuals were being called by the callers;[72] the city believed that drug traffickers were using pay phones and pagers, and a municipal judge allowed the city to place the recorders. The placement of the dialers formed the basis of the show’s first season. Simon argued that the media attention regarding the NSA programs is a “faux scandal.”[72][73] George Takei, an actor who had experienced Japanese American internment, said that due to his memories of the internment, he felt concern towards the NSA surveillance programs that had been revealed.[74]
The Electronic Frontier Foundation (EFF), an international non-profit digital-rights group based in the U.S., is hosting a tool, by which an American resident can write to their government representatives regarding their opposition to mass spying.[75]
On June 11, 2013, the American Civil Liberties Union filed a lawsuit against the NSA citing that PRISM “violates Americans’ constitutional rights of free speech, association, and privacy”.[76]
International response
Reactions of Internet users in China were mixed between viewing a loss of freedom worldwide and seeing state surveillance coming out of secrecy. The story broke just before US President Barack Obama and Chinese President Xi Jinping met in California.[77][78] When asked about NSA hacking China, the spokeswoman of Ministry of Foreign Affairs of the People’s Republic of China said “China strongly advocates cybersecurity”.[79] The party-owned newspaper Liberation Daily described this surveillance like Nineteen Eighty-Four-style.[80] Hong Kong legislators Gary Fan and Claudia Mo wrote a letter to Obama, stating “the revelations of blanket surveillance of global communications by the world’s leading democracy have damaged the image of the U.S. among freedom-loving peoples around the world.”[81]
Sophie in ‘t Veld, a Dutch Member of the European Parliament, called PRISM “a violation of EU laws”.[82]
Protests at Checkpoint Charlie in Berlin
The German Federal Commissioner for Data Protection and Freedom of Information, Peter Schaar, condemned the program as “monstrous”.[83] He further added that White House claims do “not reassure me at all” and that “given the large number of German users of Google, Facebook, Apple or Microsoft services, I expect the German government […] is committed to clarification and limitation of surveillance.” Steffen Seibert, press secretary of the Chancellor’s office, announced that Angela Merkel will put these issues on the agenda of the talks with Barack Obama during his pending visit in Berlin.[84]
The Italian president of the Guarantor for the protection of personal data, Antonello Soro, said that the surveillance dragnet “would not be legal in Italy” and would be “contrary to the principles of our legislation and would represent a very serious violation”.[85]
William Hague, the foreign secretary of the United Kingdom, dismissed accusations that British security agencies had been circumventing British law by using information gathered on British citizens by Prism[86] saying, “Any data obtained by us from the United States involving UK nationals is subject to proper UK statutory controls and safeguards.”[86] David Cameron said Britain’s spy agencies that received data collected from PRISM acted within the law: “I’m satisfied that we have intelligence agencies that do a fantastically important job for this country to keep us safe, and they operate within the law.”[86][87] Malcolm Rifkind, the chairman of parliament’s Intelligence and Security Committee, said that if the British intelligence agencies were seeking to know the content of emails about people living in the UK, then they actually have to get lawful authority.[87] The UK’s Information Commissioner’s Office was more cautious, saying it would investigate PRISM alongside other European data agencies: “There are real issues about the extent to which U.S. law agencies can access personal data of UK and other European citizens. Aspects of U.S. law under which companies can be compelled to provide information to U.S. agencies potentially conflict with European data protection law, including the UK’s own Data Protection Act. The ICO has raised this with its European counterparts, and the issue is being considered by the European Commission, who are in discussions with the U.S. Government.”[82]
Ai Weiwei, a Chinese dissident, said “Even though we know governments do all kinds of things I was shocked by the information about the US surveillance operation, Prism. To me, it’s abusively using government powers to interfere in individuals’ privacy. This is an important moment for international society to reconsider and protect individual rights.”[88]
Kim Dotcom, a German-Finnish Internet entrepreneur who owned Megaupload, which was closed by the U.S. federal government, said “We should heed warnings from Snowden because the prospect of an Orwellian society outweighs whatever security benefits we derive from Prism or Five Eyes.”[89] The Hong Kong law firm representing Dotcom expressed a fear that the communication between Dotcom and the firm had been compromised by U.S. intelligence programs.[90]
Russia has offered to consider an asylum request from Edward Snowden.[91]
Taliban spokesperson Zabiullah Mujahid said “We knew about their past efforts to trace our system. We have used our technical resources to foil their efforts and have been able to stop them from succeeding so far.”[92][93]
A parallel program, code-named BLARNEY, gathers up metadata as it streams past choke points along the backbone of the Internet. BLARNEY’s summary, set down in the slides alongside a cartoon insignia of a shamrock and a leprechaun hat, describes it as “an ongoing collection program that leverages IC [intelligence community] and commercial partnerships to gain access and exploit foreign intelligence obtained from global networks.”[94]
A related program, a big data visualization system based on cloud computing and free and open-source software (FOSS) technology known as “Boundless Informant”, was disclosed in documents leaked to The Guardian and reported on June 8, 2013. A leaked, top secret map allegedly produced by Boundless Informant revealed the extent of NSA surveillance in the U.S.[95]
ThinThread is the name of a project that the United States National Security Agency (NSA) pursued during the 1990s, according to a May 17, 2006 article in The Baltimore Sun.[1] The program involved wiretapping and sophisticated analysis of the resulting data, but according to the article, the program was discontinued three weeks before the September 11, 2001 attacks due to the changes in priorities and the consolidation of U.S. intelligence authority.[2] The “change in priority” consisted of the decision made by the director of NSA General Michael V. Hayden to go with a concept called Trailblazer, despite the fact that ThinThread was a working prototype that protected the privacy of U.S. citizens.
ThinThread was dismissed and replaced by the Trailblazer Project, which lacked the privacy protections.[3] A consortium led by Science Applications International Corporation was awarded a $280 million contract to develop Trailblazer in 2002.[4]
Trailblazer was a United States National Security Agency (NSA) program intended to develop a capability to analyze data carried on communications networks like the Internet. It was intended to track entities using communication methods such as cell phones and e-mail.[1][2] It ran over budget, failed to accomplish critical goals, and was cancelled.
NSA whistleblowers J. Kirk Wiebe, William Binney, Ed Loomis, and House Permanent Select Committee on Intelligence staffer Diane Roark complained to the Department of Defense’s Inspector General (IG) about waste, fraud, and abuse in the program, and the fact that a successful operating prototype existed, but was ignored when the Trailblazer program was launched. The complaint was accepted by the IG and an investigation began that lasted until mid-2005 when the final results were issued. The results were largely hidden, as the report given to the public was heavily (90%) redacted, while the original report was heavily classified, thus restricting the ability of most people to see it.
The people who filed the IG complaint were later raided by armed Federal Bureau of Investigation (FBI) agents. While the Government threatened to prosecute all who signed the IG report, it ultimately chose to pursue an NSA Senior Executive — Thomas Andrews Drake — who helped with the report internally to NSA and who had spoken with a reporter about the project. Drake was later charged under the Espionage Act of 1917. His defenders claimed this was retaliation.[3][4] The charges against him were later dropped, and he agreed to plead guilty to having committed a misdemeanor under the Computer Fraud and Abuse Act, something that Jesselyn Radack of the Government Accountability Project (which helped represent him) called an “act of civil disobedience”.[5]
Background
Trailblazer was chosen over a similar program named ThinThread, a less costly project which had been designed with built-in privacy protections for United States citizens.[4][3] Trailblazer was later linked to the NSA electronic surveillance program and the NSA warrantless surveillance controversy.[3]
In 2002 a consortium led by Science Applications International Corporation was chosen by the NSA to produce a technology demonstration platform in a contract worth $280 million. Project participants included Boeing, Computer Sciences Corporation, and Booz Allen Hamilton. The project was overseen by NSA Deputy Director William B. Black, Jr., an NSA worker who had gone to SAIC, and then been re-hired back to NSA by NSA director Michael Hayden in 2000.[6][7][8] SAIC had also hired a former NSA director to its management; Bobby Inman.[9] SAIC also participated in the concept definition phase of Trailblazer.[10][11]
Redacted version of the DoD Inspector General audit, obtained through the Freedom of Information Act by the Project on Government Oversight and others. [12][5]
The NSA Inspector General issued a report on Trailblazer that “discussed improperly based contract cost increases, non-conformance in the management of the Statement of Work, and excessive labor rates for contractor personnel.” [13]
In 2004 the DoD IG report criticized the program (see the Whistleblowing section below). It said that the “NSA ‘disregarded solutions to urgent national security needs’” and “that TRAILBLAZER was poorly executed and overly expensive …” Several contractors for the project were worried about cooperating with DoD’s audit for fear of “management reprisal.”[5] The Director of NSA “nonconcurred” with several statements in the IG audit, and the report contains a discussion of those disagreements.[14]
In 2005, NSA director Michael Hayden told a Senate hearing that the Trailblazer program was several hundred million dollars over budget and years behind schedule.[15] In 2006 the program was shut down,[3] after having cost billions of US Dollars.[16] Several anonymous NSA sources told Hosenball of Newsweek later on that the project was a “wasteful failure”.[17]
The new project replacing Trailblazer is called Turbulence.[3]
Whistleblowing
According to a 2011 New Yorker article, in the early days of the project several NSA employees met with Diane S Roark, an NSA budget expert on the House Intelligence Committee. They aired their grievances about Trailblazer. In response, NSA director Michael Hayden sent out a memo saying that “individuals, in a session with our congressional overseers, took a position in direct opposition to one that we had corporately decided to follow … Actions contrary to our decisions will have a serious adverse effect on our efforts to transform N.S.A., and I cannot tolerate them.”[3]
In September 2002, several people filed a complaint with the Department of Defense IG’s office regarding problems with Trailblazer: they included Roark (aforementioned), ex-NSA senior analysts Bill Binney, Kirk Wiebe, and Senior Computer Systems Analyst Ed Loomis, who had quit the agency over concerns about its mismanagement of acquisition and allegedly illegal domestic spying.[3][18][19] A major source for the report was NSA senior officer Thomas Andrews Drake. Drake had been complaining to his superiors for some time about problems at the agency, and about the superiority of ThinThread over Trailblazer, for example, at protecting privacy.[19] Drake gave info to DoD during its investigation of the matter.[19] Roark also went to her boss at the House committee, Porter Goss, about problems, but was rebuffed.[20] She also attempted to contact William Renquist, the Supreme Court Chief Justice at the time.[19]
Drake’s own boss, Maureen Baginski, the third-highest officer at NSA, quit partly over concerns about the legality of its behavior.[3]
In 2003, the NSA IG (not the DoD IG)[19] had declared Trailblazer an expensive failure.[21] It had cost more than $1 billion.[8][22][23]
In 2005, the DoD IG produced a report on the result of its investigation of the complaint of Roark and the others in 2002. This report was not released to the public, but it has been described as very negative.[18] Mayer writes that it hastened the closure of Trailblazer, which was at the time in trouble from congress for being over budget.[3]
In November 2005, Drake contacted Siobhan Gorman, a reporter of The Baltimore Sun.[24][17][25] Gorman wrote several articles about problems at the NSA, including articles on Trailblazer. This series got her an award from the Society of Professional Journalists.[17]
In 2005, President George W. Bush ordered the FBI to find whoever had disclosed information about the NSA electronic surveillance program and its disclosure in the New York Times. Eventually, this investigation led to the people who had filed the 2002 DoD IG request, even though they had nothing to do with the New York Times disclosure. In 2007, the houses of Roark, Binney, and Wiebe were raided by armed FBI agents. According to Mayer, Binney claims the FBI pointed guns at his head and that of his wife. Wiebe said it reminded him of the Soviet Union.[3][18] None of these people were ever charged with any crime. Four months later, Drake was raided in November 2007 and his computers and documents were confiscated.
In 2010 Drake was indicted by the U.S. Department of Justice on charges of obstructing justice, providing false information, and violating the Espionage Act of 1917,[17][26][27] part of President Barack Obama’s crackdown on whistleblowers and “leakers”.[24][17][28][18] The government tried to get Roark to testify to a conspiracy, and made similar requests to Drake, offering him a plea bargain. They both refused.[3]
In June 2011, the ten original charges against Drake were dropped, instead he pleaded guilty to a misdemeanor.[5]
Boundless Informant is a big data analysis and data visualization system used by the United States National Security Agency (NSA) to give NSA managers summaries of NSA’s world wide data collection activities.[1] It is described in an unclassified, For Official Use Only Frequently Asked Questions (FAQ) memo published by The Guardian.[2] According to a Top Secret heat map display also published by The Guardian and allegedly produced by the Boundless Informant program, almost 3 billion data elements from inside the United States were captured by NSA over a 30-day period ending in March 2013.
Data analyzed by Boundless Informant includes electronic surveillance program records (DNI) and telephone call metadata records (DNR) stored in an NSA data archive called GM-PLACE. It does not include FISA data, according to the FAQ memo. PRISM, a government codename for a collection effort known officially as US-984XN, which was revealed at the same time as Boundless Informant, is one source of DNR data. According to the map, Boundless Informant summarizes data records from 504 separate DNR and DNI collection sources (SIGADs). In the map, countries that are under surveillance are assigned a color from green, representing least coverage to red, most intensive.[3][4]
History
Slide showing that much of the world’s communications flow through the US.
Intelligence gathered by the United States government inside the United States or specifically targeting US citizens is legally required to be gathered in compliance with the Foreign Intelligence Surveillance Act of 1978 (FISA) and under the authority of the Foreign Intelligence Surveillance Court (FISA court).[5][6][7]
NSA global data mining projects have existed for decades, but recent programs of intelligence gathering and analysis that include data gathered from inside the United States such as PRISM were enabled by changes to US surveillance law introduced under President Bush and renewed under President Obama in December 2012.[8]
Boundless Informant was first publicly revealed on June 8, 2013, after classified documents about the program were leaked to The Guardian.[1][9] The newspaper identified its informant, at his request, as Edward Snowden, who worked at the NSA for the defense contractor Booz Allen Hamilton.[10]
Technology
According to published slides, Boundless Informant leverages Free and Open Source Software—and is therefore “available to all NSA developers”—and corporate services hosted in the cloud. The tool uses HDFS, MapReduce, and Cloudbase for data processing.[11]
Legality and FISA Amendments Act of 2008
The FISA Amendments Act (FAA) Section 702 is referenced in PRISM documents detailing the electronic interception, capture and analysis of metadata. Many reports and letters of concern written by members of Congress suggest that this section of FAA in particular is legally and constitutionally problematic, such as by targeting U.S. persons, insofar as “Collections occur in U.S.” as published documents indicate.[12][13][14][15]
The ACLU has asserted the following regarding the FAA: “Regardless of abuses, the problem with the FAA is more fundamental: the statute itself is unconstitutional.”[16]
Senator Rand Paul is introducing new legislation called the Fourth Amendment Restoration Act of 2013 to stop the NSA or other agencies of the United States government from violating the Fourth Amendment to the U.S. Constitution using technology and big data information systems like PRISM and Boundless Informant.[17][18]
ECHELON is a name used in global media and in popular culture to describe a signals intelligence (SIGINT) collection and analysis network operated on behalf of the five signatory states to the UKUSA Security Agreement[1] (Australia, Canada, New Zealand, the United Kingdom, and the United States, referred to by a number of abbreviations, including AUSCANNZUKUS[1] and Five Eyes).[2][3] It has also been described as the only software system which controls the download and dissemination of the intercept of commercial satellite trunk communications.[4]
ECHELON, according to information in the European Parliament document, “On the existence of a global system for the interception of private and commercial communications (ECHELON interception system)” was created to monitor the military and diplomatic communications of the Soviet Union and its Eastern Bloc allies during the Cold War in the early 1960s.[5]
The system has been reported in a number of public sources.[6] Its capabilities and political implications were investigated by a committee of the European Parliament during 2000 and 2001 with a report published in 2001,[5] and by author James Bamford in his books on the National Security Agency of the United States.[4] The European Parliament stated in its report that the term ECHELON is used in a number of contexts, but that the evidence presented indicates that it was the name for a signals intelligence collection system. The report concludes that, on the basis of information presented, ECHELON was capable of interception and content inspection of telephone calls, fax, e-mail and other data traffic globally through the interception of communication bearers including satellite transmission, public switched telephone networks (which once carried most Internet traffic) and microwave links.[5]
Bamford describes the system as the software controlling the collection and distribution of civilian telecommunications traffic conveyed using communication satellites, with the collection being undertaken by ground stations located in the footprint of the downlink leg.
The UKUSA intelligence community was assessed by the European Parliament (EP) in 2000 to include the signals intelligence agencies of each of the member states:
the Government Communications Headquarters of the United Kingdom,
the National Security Agency of the United States,
the Communications Security Establishment of Canada,
the Defence Signals Directorate of Australia, and
the Government Communications Security Bureau of New Zealand.
the National SIGINT Organisation (NSO) of The Netherlands
The EP report concluded that it seemed likely that ECHELON is a method of sorting captured signal traffic, rather than a comprehensive analysis tool.[5]
Capabilities
The ability to intercept communications depends on the medium used, be it radio, satellite, microwave, cellular or fiber-optic.[5] During World War II and through the 1950s, high frequency (“short wave”) radio was widely used for military and diplomatic communication,[7] and could be intercepted at great distances.[5] The rise of geostationary communications satellites in the 1960s presented new possibilities for intercepting international communications. The report to the European Parliament of 2001 states: “If UKUSA states operate listening stations in the relevant regions of the earth, in principle they can intercept all telephone, fax and data traffic transmitted via such satellites.”[5]
The role of satellites in point-to-point voice and data communications has largely been supplanted by fiber optics; in 2006, 99% of the world’s long-distance voice and data traffic was carried over optical-fiber.[8] The proportion of international communications accounted for by satellite links is said to have decreased substantially over the past few years[when?] in Central Europe to an amount between 0.4% and 5%.[5] Even in less-developed parts of the world, communications satellites are used largely for point-to-multipoint applications, such as video.[9] Thus, the majority of communications can no longer be intercepted by earth stations; they can only be collected by tapping cables and intercepting line-of-sight microwave signals, which is possible only to a limited extent.[5]
One method of interception is to place equipment at locations where fiber optic communications are switched. For the Internet, much of the switching occurs at relatively few sites. There have been reports of one such intercept site, Room 641A, in the United States. In the past[when?] much Internet traffic was routed through the U.S. and the UK, but this has changed; for example, in 2000, 95% of intra-German Internet communications was routed via the DE-CIX Internet exchange point in Frankfurt.[5] A comprehensive worldwide surveillance network is possible only if clandestine intercept sites are installed in the territory of friendly nations, and/or if local authorities cooperate. The report to the European Parliament points out that interception of private communications by foreign intelligence services is not necessarily limited to the U.S. or British foreign intelligence services.[5]
Most reports on ECHELON focus on satellite interception; testimony before the European Parliament indicated that separate but similar UK-US systems are in place to monitor communication through undersea cables, microwave transmissions and other lines.[10]
Controversy
See also: Industrial espionage
Intelligence monitoring of citizens, and their communications, in the area covered by the AUSCANNZUKUS security agreement has caused concern. British journalist Duncan Campbell and New Zealand journalist Nicky Hager asserted in the 1990s that the United States was exploiting ECHELON traffic for industrial espionage, rather than military and diplomatic purposes.[10] Examples alleged by the journalists include the gear-less wind turbine technology designed by the German firm Enercon[5][11] and the speech technology developed by the Belgian firm Lernout & Hauspie.[12] An article in the US newspaper Baltimore Sun reported in 1995 that European aerospace company Airbus lost a $6 billion contract with Saudi Arabia in 1994 after the US National Security Agency reported that Airbus officials had been bribing Saudi officials to secure the contract.[13][14]
In 2001, the Temporary Committee on the ECHELON Interception System recommended to the European Parliament that citizens of member states routinely use cryptography in their communications to protect their privacy, because economic espionage with ECHELON has been conducted by the US intelligence agencies.[5]
Bamford provides an alternative view, highlighting that legislation prohibits the use of intercepted communications for commercial purposes, although he does not elaborate on how intercepted communications are used as part of an all-source intelligence process.
Hardware
According to its website, the U.S. National Security Agency (NSA) is “a high technology organization … on the frontiers of communications and data processing”. In 1999 the Australian Senate Joint Standing Committee on Treaties was told by Professor Desmond Ball that the Pine Gap facility was used as a ground station for a satellite-based interception network. The satellites were said to be large radio dishes between 20 and 100 meters in diameter in geostationary orbits.[citation needed] The original purpose of the network was to monitor the telemetry from 1970s Soviet weapons, air defence radar, communications satellites and ground based microwave communications.[15]
Name
The European Parliament’s Temporary Committee on the ECHELON Interception System stated: “It seems likely, in view of the evidence and the consistent pattern of statements from a very wide range of individuals and organisations, including American sources, that its name is in fact ECHELON, although this is a relatively minor detail.”[5] The U.S. intelligence community uses many code names (see, for example, CIA cryptonym).
Former NSA employee Margaret Newsham claims that she worked on the configuration and installation of software that makes up the ECHELON system while employed at Lockheed Martin, for whom she worked from 1974 to 1984 in Sunnyvale, California, US, and in Menwith Hill, England, UK.[16] At that time, according to Newsham, the code name ECHELON was NSA’s term for the computer network itself. Lockheed called it P415. The software programs were called SILKWORTH and SIRE. A satellite named VORTEX intercepted communications. An image available on the internet of a fragment apparently torn from a job description shows Echelon listed along with several other code names.[17]
Ground stations
The 2001 European Parliamentary (EP) report[5] lists several ground stations as possibly belonging to, or participating in, the ECHELON network. These include:
Likely satellite intercept stations
The following stations are listed in the EP report (p. 54 ff) as likely to have, or to have had, a role in intercepting transmissions from telecommunications satellites:
Hong Kong (since closed)
Australian Defence Satellite Communications Station (Geraldton, Western Australia)
Menwith Hill (Yorkshire, U.K.) Map (reportedly the largest Echelon facility)[18]
Misawa Air Base (Japan) Map
GCHQ Bude, formerly known as GCHQ CSO Morwenstow, (Cornwall, U.K.) Map
Pine Gap (Northern Territory, Australia – close to Alice Springs) Map
Sugar Grove (West Virginia, U.S.) Map
Yakima Training Center (Washington, U.S.) Map
GCSB Waihopai (New Zealand)
GCSB Tangimoana (New Zealand)
CFS Leitrim (Ontario, Canada)
Teufelsberg (Berlin, Germany) (closed 1992)
Other potentially related stations
The following stations are listed in the EP report (p. 57 ff) as ones whose roles “cannot be clearly established”:
Ayios Nikolaos (Cyprus – U.K.)
Bad Aibling Station (Bad Aibling, Germany – U.S.)
relocated to Griesheim in 2004[19]
deactivated in 2008[20]
Buckley Air Force Base (Aurora, Colorado)
Fort Gordon (Georgia, U.S.)
Gander (Newfoundland & Labrador, Canada)
Guam (Pacific Ocean, U.S.)
Kunia Regional SIGINT Operations Center (Hawaii, U.S.)
Lackland Air Force Base, Medina Annex (San Antonio, Texas)
Room 641A is a telecommunication interception facility operated by AT&T for the U.S. National Security Agency that commenced operations in 2003 and was exposed in 2006.[1][2]
Description
Room 641A is located in the SBC Communications building at 611 Folsom Street, San Francisco, three floors of which were occupied by AT&T before SBC purchased AT&T.[1] The room was referred to in internal AT&T documents as the SG3 [Study Group 3] Secure Room. It is fed by fiber optic lines from beam splitters installed in fiber optic trunks carrying Internet backbone traffic[3] and, as analyzed by J. Scott Marcus, a former CTO for GTE and a former adviser to the FCC, who has access to all Internet traffic that passes through the building, and therefore “the capability to enable surveillance and analysis of internet content on a massive scale, including both overseas and purely domestic traffic.”[4] Former director of the NSA’s World Geopolitical and Military Analysis Reporting Group, William Binney, has estimated that 10 to 20 such facilities have been installed throughout the United States.[2]
The room measures about 24 by 48 feet (7.3 by 15 m) and contains several racks of equipment, including a Narus STA 6400, a device designed to intercept and analyze Internet communications at very high speeds.[1]
The very existence of the room was revealed by a former AT&T technician, Mark Klein, and was the subject of a 2006 class action lawsuit by the Electronic Frontier Foundation against AT&T.[5] Klein claims he was told that similar black rooms are operated at other facilities around the country.
Room 641A and the controversies surrounding it were subjects of an episode of Frontline, the current affairs documentary program on PBS. It was originally broadcast on May 15, 2007. It was also featured on PBS’s NOW on March 14, 2008. The room was also covered in the PBS Nova episode “The Spy Factory”.
Lawsuit
Basic diagram of how the alleged wiretapping was accomplished. From EFF court filings[4]
More complicated diagram of how it allegedly worked. From EFF court filings.[3] See bottom of the file page for enlarged and rotated version.
The Electronic Frontier Foundation (EFF) filed a class-action lawsuit against AT&T on January 31, 2006, accusing the telecommunication company of violating the law and the privacy of its customers by collaborating with the National Security Agency (NSA) in a massive, illegal program to wiretap and data-mine Americans’ communications. On July 20, 2006, a federal judge denied the government’s and AT&T’s motions to dismiss the case, chiefly on the ground of the States Secrets Privilege, allowing the lawsuit to go forward. On August 15, 2007, the case was heard by the Ninth Circuit Court of Appeals and was dismissed on December 29, 2011 based on a retroactive grant of immunity by Congress for telecommunications companies that cooperated with the government. The U.S. Supreme Court declined to hear the case.[6] A different case by the EFF was filed on September 18, 2008, titled Jewel v. NSA.
PRISM: A clandestine national security electronic surveillance program operated by the United States National Security Agency (NSA) which can target customers of participating corporations outside or inside the United States
Main Core: A personal and financial database storing information of millions of U.S. citizens believed to be threats to national security.[7] The data mostly comes from the NSA, FBI, CIA, as well as other government sources.[7]
Carnivore: A system implemented by the Federal Bureau of Investigation that was designed to monitor email and electronic communications. Apparently replaced by commercial software such as NarusInsight
Intelligence Community (IC): A cooperative federation of 16 government agencies working together, but also separately, to gather intelligence and conduct espionage
Top Rep For Immigration Law Enforcement Officers: Senate Immigration Bill Threatens Public Safety
–Testimony from Chris Crane, ICE Officer and President of the National ICE Council representing our nation’s ICE officers, agents and staff. Crane is also a former marine.
Today’s hearing was on the Gang of Eight’s immigration proposal, which the Majority hopes to rush to a vote before the American people know what’s in it.”
Chris Crane Testimony At Senate Immigration Hearing
Sessions To Senate: Can Anyone Explain How This Immigration Bill Will Help Struggling Americans?
Schumer, Gang of Eight Refuse To Say How Many Will Be Admitted Under Their Plan
Law Enforcement Groups Detail How Immigration Bill Guts Future Enforcement
Dramatic Guest Worker Provisions In Immigration Bill Designed To Suppress Wages
Sessions Warns Washington Elites Against Rush To Amnesty
Sen. Ted Cruz Speaks on the Senate Floor in Opposition to the Gang of Eight’s Immigration Bill
Congressman Steve King Spoke on the House Floor — Immigration and Securing the Border
Congressman Steve King leads House opposition to Senate’s Gang of Eight immigration bill
Immigration Reform in Limbo: House ‘Teabaggers’ Bent on Torpedoing Bill
Immigration by the Numbers — Off the Charts
Immigration, World Poverty and Gumballs – Updated 2010
How Many Illegal Aliens Are in the US? – Walsh – 1
How Many Illegal Aliens Are in the United States? Presentation by James H. Walsh, Associate General Counsel of the former INS – part 1.
How Many Illegal Aliens Are in the US? – Walsh – 2
How Many Illegal Aliens Are in the United States? Presentation by James H. Walsh, Associate General Counsel of the former INS – part 2.
Glenn Beck: Interview with House Republicans Planning Revolt On Immigration Bill
Glenn Beck to Release Name of 70 House Republicans for Showdown w John Boehner on Amnesty Bill
Laura Ingraham Confronts Marco Rubio Over Immigration Reform: ‘Stop Dividing The Republican Party’
Rand Paul: Immigration Reform Can’t Pass Without Conservative Votes – Laura Ingraham 4/24/2013
USA To Provide Military Support To Al-Qaeda-Backed Syria ‘Rebels’
WAR: White House Says Syria Crossed “Red Line” – Will Provide Military Support To Syrian Rebels!
Syria – Who are Jabhat al-Nusra? – Truthloader
Al Nusra Front Terror Camp in Lattakia, Syria (30/12/12)
A video released by an increasingly powerful and well connected Al Qaeda cell in Syria’s Northern Province of Lattakia depicts the terrorist organisation training recruits, many of whom are foreigners in the heavily forested and mountainous terrain typical of Lattakia.
The original video feratured speeches from well known Al Qaeda figures, (which I haven’t included in this video) including slain former second in command Abu Yaya Al Libi who was killed in a US drone strike in Pakistan. Al Qaeda in Lattakia could beconsidered separate to the major Al Qaeda in Syria branch Jabhat Al Nusra in the sense that they have direct connections to the mainstream global Jihadist community without having to run through Jabhat Al Nusra, itself a known affiliate of Al Qaeda in Iraq.
The emergence of groups like Al Qaeda in Lattakia mirrors a trend in which new Jihadist groups many connected to previous incarnations of the Al Qaeda brand are now springing up all over Syria making a volatile situation in which extreme Jihadists already dominate the insurgency even more complex and dangerous. There can be little doubt that Afghanistan’s problems with Islamic militany similarly tired to Western support may well be dwarfed by the carnage and terrorism that may emanate from Syria for decades to come should the insurgents not be defeated.
The Road to World War 3
World War 3 Has Already Begun
World War 3 – TheBlaze
GLENN Beck Explains Why World War III Could Be on the Horizon
John McCain meets Syrian opposition face-to-face
JOHN McCain Syria Chemical Weapons Use Crosses Red Line Game Changer.
Glenn Beck: We Are on The Wrong Side in Syria
Benghazi-Gate: Connection between CIA and al-Qaeda in Libya and Syria, with Turkey’s Help
GERALD CELENTE - The Start Of WW3 - ISRAEL says they have Right to Defend Themselves
U.S.: Syria used chemical weapons, crossing “red line”
By Steve Chaggaris, Stephanie Condon
The Obama administration has concluded that Syrian President Bashar Assad’s government used chemical weapons against the rebels seeking to overthrow him and, in a major policy shift, President Obama has decided to supply military support to the rebels, the White House announced Thursday.
“The president has made a decision about providing more support to the opposition that will involve providing direct support to the [Supreme Military Council]. That includes military support,” Deputy National Security Adviser for Strategic Communication Ben Rhodes told reporters.
President Obama has repeatedly said that the use of chemical weapons is a “red line” that, if crossed, would be a “game changer” for more U.S. involvement in the Syrian civil war.
“The President has been clear that the use of chemical weapons – or the transfer of chemical weapons to terrorist groups – is a red line for the United States,” said Rhodes in a separate written statement.
“The President has said that the use of chemical weapons would change his calculus, and it has,” he continued.
In terms of further response, Rhodes said, “we will make decisions on our own timeline” and that Congress and the international community would be consulted. Mr. Obama is heading to Northern Ireland Sunday for a meeting of the G8 group of nations; Rhodes indicated the president will consult with leaders of those countries.
“Any future action we take will be consistent with our national interest, and must advance our objectives, which include achieving a negotiated political settlement to establish an authority that can provide basic stability and administer state institutions; protecting the rights of all Syrians; securing unconventional and advanced conventional weapons; and countering terrorist activity,” Rhodes said.
To date, the U.S. policy on Syria has primarily focused on offering the rebels nonlethal assistance and humanitarian aid.
Sen. John McCain, R-Ariz., who met with the rebels last month and has been a vocal critic of the president’s Syria policy said in a joint statement with Sen. Lindsey Graham, R-S.C.: “We appreciate the President’s finding that the Assad regime has used chemical weapons on several occasions. We also agree with the President that this fact must affect U.S. policy toward Syria. The President’s red line has been crossed. U.S. credibility is on the line. Now is not the time to merely take the next incremental step. Now is the time for more decisive actions.”
“A decision to provide lethal assistance, especially ammunition and heavy weapons, to opposition forces in Syria is long overdue, and we hope the President will take this urgently needed step” they added. Former President Bill Clinton this week, at a private event with McCain, also ratcheted up pressure for the White House to increase its support to the rebels.
However, Rhodes would not detail the type of military support the administration intends on providing. He said helping the opposition improve their effectiveness as a fighting force means helping with “nonlethal assistance” such as communications equipment and transportation. “These are things that allow them to cohere as a unit,” he said.
He added, meanwhile, that no decision has been made about enforcing a no-fly zone over Syria. “A no-fly zone… would carry with it open-ended costs for the international community,” Rhodes said. “Furthermore, there’s not even a clear guarantee that it would dramatically improve the situation on the ground.”
A Syrian rebel group’s pledge of allegiance to al-Qaeda’s replacement for Osama bin Laden suggests that the terrorist group’s influence is not waning and that it may take a greater role in the Western-backed fight to topple Syrian President Bashar Assad.
The pledge of allegiance by Syrian Jabhat al Nusra Front chief Abou Mohamad al-Joulani to al-Qaeda leader Sheik Ayman al-Zawahri was coupled with an announcement by the al-Qaeda affiliate in Iraq, the Islamic State of Iraq, that it would work with al Nusra as well.
Lebanese Sheik Omar Bakri, a Salafist who says states must be governed by Muslim religious law, says al-Qaeda has assisted al Nusra for some time.
“They provided them early on with technical, military and financial support , especially when it came to setting up networks of foreign jihadis who were brought into Syria,” Bakri says. “There will certainly be greater coordination between the two groups.”
The United States, which supports the overthrow of Assad, designated al Nusra a terrorist entity in December. The Obama administration has said it wants to support only those insurgent groups that are not terrorist organizations.
Al Nusra and groups like it have seen some of the most significant victories against Syrian government forces in the course of the 2-year-old uprising in which Assad’s forces have killed about 80,000 people. Rebels not affiliated with al-Qaeda have pressed Washington for months to send weaponry that will allow them to match the heavy weapons of the Syrian army. They’ve urged the West to mount an air campaign against Assad’s mechanized forces.
President Obama refuses to provide any direct military aid. Foreign radical Islamists streaming into the fight from the Middle East and Europe are making headway with the Syrian population by providing services and gaining ground in battles.
Tamer Mouhieddine, spokesman for the Syrian Free Army, a force made up of Syrian soldiers who have defected, said the recent announcements would not change his group’s attitude toward al Nusra.
“The rebels in Syria have one common enemy — Bashar Assad — and they will collaborate with any faction allowing them to topple his regime,” he said.
He confirmed that al Nusra is generating loyalty in Aleppo, a region battling for months with Assad, by providing financial support as well as setting up charities.
Aaron Zelin at the Washington Institute for Near East Policy in Washington says al Nusra’s ability to provide security and basic needs such as bread and fuel to Syrian civilians, as well as to reopen shops and restart bus services, has won gratitude from people who would not usually adhere to its strict ideology.
Zelin says some Syrian people have criticized al Nusra for banning alcohol, forcing women to wear a full veil and whipping men who are seen with women in public.
“This illustrates the need for American leadership in the Syrian conflict, particularly with regard to helping non-Qaeda-aligned rebels contain the growth of (al Nusra) and similar groups,” he said. “Washington should also try to take advantage of cleavages within the rebellion and civilian population, since al Nusra is outside the mainstream and more concerned with establishing a transnational caliphate than maintaining the Syrian state.”
Groups such as the Islamic Liwaa al Tawhid, which collaborates with al Nusra on military operations, worried that Assad would use the announcement from al Nusra as evidence for his claim that he is fighting terrorists, not Syrian citizens who wish an end to his dictatorship, Mouhieddine said.
“We are willing to fight alongside any faction targeting the Assad regime, as long as it does not have a foreign agenda, which seems now the case” of al Nusra, he said.
“This amnesty will give citizenship to only 1.1 to 1.3 million illegal aliens. We will secure the borders henceforth. We will never again bring forward another amnesty bill like this.”
~Senator Edward “Ted” Kennedy, D-Mass, regarding an amnesty bill passed in 1986
Immigration by the Numbers — Off the Charts
Immigration, World Poverty and Gumballs – Updated 2010
1984 – Ronald Reagan on Amnesty
In this brief video-clip from the 1984 presidential debates Ronald Reagan discusses immigration, amnesty and the failure of the first attempt to pass the Simpson-Mazzoli Immigration Reform and Control Act. [When the act finally passed (1986) did we get reform? Did we get control?]
The Immigration Reform and Control Act of 1986
Illegal Alien
A foreigner who has either entered a country illegally (e.g. without inspection or proper documents) or who has violated the terms of legal admission to the country (e.g. by overstaying the duration of a tourist or student visa).
8 USC § 1101 – Definitions
(3) The term “alien” means any person not a citizen or national of the United States.
How Many Illegal Aliens Are in the US? – Walsh – 1
How Many Illegal Aliens Are in the United States? Presentation by James H. Walsh, Associate General Counsel of the former INS – part 1.
How Many Illegal Aliens Are in the US? – Walsh – 2
How Many Illegal Aliens Are in the United States? Presentation by James H. Walsh, Associate General Counsel of the former INS – part 2.
Census Bureau estimates of the number of illegals in the U.S. are suspect and may represent significant undercounts. The studies presented by these authors show that the numbers of illegal aliens in the U.S. could range from 20 to 38 million.
US immigration system moves towards reform
Sen. Ted Cruz Speaks on the Senate Floor in Opposition to the Gang of Eight’s Immigration Bill
Glenn Beck to Release Name of 70 House Republicans for Showdown w John Boehner on Amnesty Bill
Glenn Beck: Interview with House Republicans Planning Revolt On Immigration Bill
Glenn Beck Program Immigration and Equal Opportunity 06132013
US Senate Votes to Consider Citizenship for Illegal Immigrants
News Wrap: Senate Votes to Begin Immigration Reform Debate
Border Insecurity Citizens Track Surge Of Illegal Immigration! – Wake Up America!!
Chris Pyle, Whistleblower on CIA Domestic Spying in 70s, Says Be Wary of Attacks on NSA’s Critics
NSA Chief Grilled at Senate Hearing on Surveillance Programs
He told you so: Bill Binney talks NSA leaks
“In the wake of multiple leaks regarding the data mining programs PRISM and Boundless Informant, whistleblowers are coming out in droves to talk about the unprecedented government surveillance on the American public. RT Correspondent Meghan Lopez had a chance to sit down with NSA whistleblower William Binney to talk about the latest developments coming out of the NSA case. Binney is a 32 year veteran of the NSA, where he helped design a top secret program he says helps collect data on foreign enemies. He is regarded as one of the best mathematicians and code breakers in NSA history. He became an NSA whistleblower in 2002 when he realized the program he helped create to spy no foreign enemies was being used on Americans.”
A Massive Surveillance State Glenn Greenwald Exposes Covert NSA Program Collecting Calls, Emails
What You Should Know About The New NSA Utah Data Center
Glenn Greenwald Vs Bush Press Sec. Ari Fleischer Over NSA’s PRISM
NSA Whistleblowers: “All U.S.Citizens” Targeted By Surveillance Program, Not Just Verizon Customers
Experts Say NSA Leak Damage Could be Significant
“SPY AND DENY” IS THE NEW NORMAL IN USA!
Era of Online Sharing Offers ‘Big Data,’ Privacy Trade-Offs
Rep King Drops Bombshell; Sen Lee To Talk Claim Chief Justice Roberts Blackmailed
How PRISM Easily Gives Your Private Data Over to Big Brother
“The National Security Agency has obtained direct access to the systems of Google, Facebook, Apple and other US internet giants, according to a top secret document obtained by the Guardian.
The NSA access is part of a previously undisclosed program called Prism, which allows officials to collect material including search history, the content of emails, file transfers and live chats, the document says.”*
We’ve been assured by the president that the NSA’s PRISM program won’t affect “ordinary” U.S. citizens, but what is the criteria for deciding who gets their data mined and monitored? Cenk Uygur, Ben Mankiewicz, and John Iadarola (Host, TYT University) discuss the egregious reach of the Obama administration’s secret mass surveillance program.
NSA whistleblower Edward Snowden: ‘I don’t want to live in a society that does these sort of things’
Microtargeting
RNC/DNC Collecting Your Info En Masse
ILLEGAL IMMIGRATION IS DESTROYING AMERICA
The Dangers of Unlimited Legal & Illegal Immigration
Immigration by the Numbers — Off the Charts
Immigration, World Poverty and Gumballs – Updated 2010
THEY COME TO AMERICA II. The Cost of Amnesty
They Come to America (Trailer 2)
2012: They Come to America. The Cost of Illegal Immigration.
Schumer Refuses To Estimate Future Immigration Flow Under Gang Of Eight Proposal
Obama To Stop Deporting Young Illegal Immigrants
“The Obama administration will stop deporting young illegal immigrants who came to the U.S. as children and who do not pose a security threat, senior administration officials said this morning, a move that could prove important in a presidential campaign that will turn in part on who wins over Latino voters.
Effective immediately, young immigrants who arrived in the U.S. illegally before they turned 16 will be allowed to apply for work permits as long as they have no criminal history and meet other criteria, officials said.
Reality Check: President Obama’s Immigration Reform Rings Hollow
(Part I) A Day in the Life of an Arizona Rancher: Fences, Illegal Aliens, and One Man’s Watchtower
(Part II) A Day in the Life of an Arizona Rancher: Fences, Illegal Aliens, and One Man’s Watchtower
Background Articles and Videos
Ap’s “Illegal Immigrant” Stand – Leno: Illegal Immigrants That is Out, Now “Undocumented Democrats”
Illegal immigration to the United States – Wiki Article
Illegal immigration to the United States is the act of foreign nationals entering the United States, without government permission and in violation of United States nationality law, or staying beyond the termination date of a visa, also in violation of the law.
The illegal immigrant population of the United States in 2008 was estimated by the Center for Immigration Studies to be about 11 million people, down from 12.5 million people in 2007. Other estimates range from 7 to 20 million. According to a Pew Hispanic Center report, in 2005, 56% of illegal immigrants were from Mexico; 22% were from other Latin American countries, primarily from Central America; 13% were from Asia; 6% were from Europe and Canada; and 3% were from Africa and the rest of the world.
Profile and demographics
Illegal immigrants continue to outpace the number of legal immigrants —a trend that’s held steady since the 1990s. While the majority of illegal immigrants continue to concentrate in places with existing large Hispanic communities, increasingly illegals are settling throughout the rest of the country.
An estimated 14 million people live in families in which the head of household or the spouse is in the United States illegaly . The number of illegal immigrants arriving in recent years tend to be better educated than those who have been in the country a decade or more. A quarter of all immigrants who have arrived in recent years have at least some college education. Nonetheless, illegal immigrants as a group tend to be less educated than other sections of the U.S. population: 49 percent haven’t completed high school, compared with 9 percent of native-born Americans and 25 percent of legal immigrants.
Illegal immigrants work in many sectors of the U.S. economy. According to National Public Radio in 2005, about 3 percent work in agriculture; 33 percent have jobs in service industries; and substantial numbers can be found in construction and related occupations (16 percent), and in production, installation, and repair (17 percent). According to USA Today in 2006, about 4 percent work in farming; 21 percent have jobs in service industries; and substantial numbers can be found in construction and related occupations (19 percent), and in production, installation, and repair (15 percent), with 12% in sales, 10% in management, and 8% in transportation. Illegal immigrants have lower incomes than both legal immigrants and native-born Americans, but earnings do increase somewhat the longer an individual is in the country.
A percentage of illegal immigrants do not remain indefinitely but do return to their country of origin; they are often referred to as “sojourners: they come to the United States for several years but eventually return to their home country.”
Breakdown by state
As of 2006, the following data table shows a spread of distribution of locations where illegal immigrants reside by state.
Number of illegal immigrants
According to the Government Accountability Office (GAO), different estimates of the total number of illegal immigrants vary depending on how the term is defined. There are also questions about data reliability.
The GAO has stated that “it seems clear that the population of undocumented foreign-born persons is large and has increased rapidly.” On April 26, 2006 the Pew Hispanic Center (PHC) estimated that in March 2005 the number of illegal immigrants in the U.S. ranged from 11.5 to 12 million individuals. This number was derived by a statistical method known as the “residual method.” According to the General Accounting office the residual estimation (1) starts with a census count or survey estimate of the number of foreign-born residents who have not become U.S. citizens and (2) subtracts out estimated numbers of legally present individuals in various categories, based on administrative data and assumptions (because censuses and surveys do not ask about legal status). The remainder, or residual, represents an indirect estimate of
Senate Dismisses Any Pretense of Enforcement in the Gang of Eight Immigration Bill
Rubio Reneges on Promise to Fix Flaws in the Bill
(Washington, D.C. June 13, 2013) In the first important vote on amendments to the Gang of Eight immigration bill, S.744, the United States Senate quickly dismissed any pretense that they intend to deliver on promises of future immigration enforcement, declared the Federation for American Immigration Reform (FAIR). By a 57-43 vote, the Senate tabled an amendment by Sen. Chuck Grassley (R-Iowa) that would have required that the Department of Homeland Security (DHS) demonstrate effective control of U.S. borders for six months before illegal aliens could gain amnesty.
“Today’s vote makes it clear that a majority of senators place a higher priority on granting amnesty to illegal aliens than they do on fulfilling their promises to the American people that our borders will be secured and that our immigration laws will be enforced,” said Dan Stein, president of FAIR. “Tellingly, Gang of Eight member Marco Rubio (R-Fla.), who has repeatedly vowed to oppose the bill if border enforcement provisions are not strengthened, was among the majority of senators who voted to kill the Grassley amendment.”
Majority Leader Harry Reid (D-Nev.) described the amendment as a “poison pill” and used a parliamentary procedure to shut off debate on it. “In the Alice in Wonderland world of the United States Senate, securing our borders and fulfilling promises to the American people, before rewarding illegal aliens, is considered a ‘poison pill,’” observed Stein.
“The vote also undermines whatever credibility Sen. Rubio had left as an honest broker on behalf of the interests of the American people. The fix is in and Rubio is off the fence. The Gang of Eight and the Senate leadership will employ any tactic to prevent amendments that might upset special interest constituencies from supporting the bill,” Stein continued.
“Under this bill there will be no border security. There will be no immigration enforcement. The Gang of Eight bill is about delivering amnesty to illegal aliens and cheap labor to business interests, and nothing else,” Stein concluded.
Sasha Issenberg interviewed at Strata Santa Clara 2013
Sasha Issenberg Discusses His New Book, ‘The Victory Lab’
Sasha Issenberg | The Victory Lab: How Innovation Happens in Electioneering | PDF13
Algorithmic Trading to Algorithmic Campaigning, Behind the Political Scene w/Sasha Issenberg
The Anatomy of an Election: Technology with Sasha Issenberg
The Victory Lab: ‘Moneyball for Politics’” Sasha Issenberg
A Conversation with Sasha Issenberg
Sasha Issenberg discusses the 2012 Obama campaign
Sasha Issenberg discusses the use of social science experiments in Rick Perry’s 2006 campaign
Sasha Issenberg speaks at NationBuilder
How They Did It: Political Tactics That Helped Obama Win
Can You Replicate the Obama Strategy? | The New School for Public Engagement
Political campaigns have revolutionized the way they target, contact and motivate supporters. Strategists are taking the insights of experimental social science and marrying them to the corporate world’s Big Data marketing tools. The Obama Campaign won in large part by using statistical modeling techniques to identify persuadable voters and to fine-tune persuasive messages. This is politics today and in the future—not only for elections but on issue campaigns for education reform, health care, the environment, labor rights and beyond. Who are the pioneers? And how might you apply their the strategies?
Maxine Waters (D) Slip of the Tongue Reveals True Intentions (Socialism for America)
Obama’s secret microtargeting operation
Campaigns admit to data mining
During campaigning, candidates are going to great lengths to find out about residents. Both presidential campaigns admit to tracking everything you do online.
Obama’s win: data mining
How We Used Data to Win the Presidential Election
Dan Siroker, of the Obama Campaign and CarrotSticks, describes how the campaign used data to win the presidential election. He shares the lessons his team learned along the way and how one can apply them to any data-driven decision one needs to make — whether it be in developing, designing, or even marketing.
Can You Replicate the Obama Strategy? | The New School for Public Engagement
Political campaigns have revolutionized the way they target, contact and motivate supporters. Strategists are taking the insights of experimental social science and marrying them to the corporate world’s Big Data marketing tools. The Obama Campaign won in large part by using statistical modeling techniques to identify persuadable voters and to fine-tune persuasive messages. This is politics today and in the future—not only for elections but on issue campaigns for education reform, health care, the environment, labor rights and beyond. Who are the pioneers? And how might you apply their the strategies?
Strata 2013: Sasha Issenberg, “The Victory Lab”
The Victory Lab: ‘Moneyball for Politics’” Sasha Issenberg
A Conversation with Sasha Issenberg
Sasha Issenberg discusses the 2012 Obama campaign
Sasha Issenberg discusses the use of social science experiments in Rick Perry’s 2006 campaign
Political Checklist: Frontline Looks at Digital Campaigns
Frontline: The Digital Factor in Election 2012
Frontline: How Much Do Digital Campaigns Know About You?
Webinar – Political Campaign Fundraising with Aristotle 360
Use Voter Data for a Smart Political Campaign
‘Big Brother’ is watching, in sophisticated digital ways
By Gitte Laasby
Town of Mukwonago voter Priscilla Trulen is used to ignoring political solicitations. For weeks, she’s been receiving three political robocalls per day related to the presidential election. On Thursday, she got seven.
But one call she got on Halloween still haunts her. It was a recorded message read by a presidential candidate trying to get her to vote.
“It was Mitt Romney saying, ‘I know you have an absentee ballot and I know you haven’t sent it in yet,’ ” Trulen said in an interview. “That just sent me over the line. Not only is it like Big Brother. It is Big Brother. It’s down to where they know I have a ballot and I haven’t sent it in! I thought when I requested the ballot that the only other entity that would know was the Mukwonago clerk.”
Trulen isn’t the only voter among Wisconsin’s much-courted electorate who is getting creeped out by the political campaigns’ unprecedented, uncanny ability to micro-target voters who are likely to vote for their candidate.
The solicitations give only a small glimpse into how much digital information the campaigns are able to access about voters.
For years, campaigns have requested the statewide voter registration list, which is subject to public information requests.
The database contains the names and addresses of active voters who are registered and able to vote, as well as inactive voters who are ineligible to vote because they have passed away, moved out of state or committed a felony, or people who need to re-register to be eligible, said Reid Magney, public information officer with the Wisconsin Government Accountability Board.
The list also contains information that the state does not release, for instance people’s birth dates, driver’s license numbers and phone numbers.
“It’s typical for both parties, or individual candidates, to be making public records requests from the clerks. And it’s perfectly legal,” Magney said. “This information is public so there’s transparency in our elections. . . . Except for how you vote, there really are no secrets.”
The state database also contains information on absentee voters. The state’s 1,851 municipalities are required to account for military and overseas absentee ballots both before and after the election, Magney said. Municipalities don’t have to report to the state whether regular absentee ballots such as Trulen’s have been returned until the election is over. However, some municipalities, including the Town of Mukwonago where Trulen lives, report to the state database as they go whether those ballots have been returned. Most likely, that’s how the Republican campaign found out Trulen received an absentee ballot.
“There’s nothing confidential as far as, ‘Did so and so vote?’ ” said Kathy Karalewitz, administrative clerk treasurer with the town. “As far as how they vote, yes.”
Requesters can also request information related to absentee ballots directly from the municipalities, although that’s more cumbersome and labor intensive.
The cost of the entire state database is $12,500. Four requesters have been willing to pay that since Sept. 1, Magney said: Catalist (a progressive voter database organization), the Democratic National Committee, and data analysis firm Aristotle – all based in Washington, D.C. The last requester was Colorado-based Magellan Strategies, a firm that specializes in “micro-targeting” for Republican parties and candidates.
Another 200 requests have been made since Sept. 1 for smaller portions of the database, Magney said.
Crunching the numbers
But what really enables the campaigns to “slice and dice” the electorate down to individual voters is that the voter list is correlated with a slew of other information designed to predict voting behavior and issues that the voter would care about.
In an interview with PBS that aired in October, Aristotle’s chief executive officer, John Phillips, said the company keeps up to 500 data points on each voter – from the type of clothes they buy, the music they listen to, magazines they read and car they own, to whether they are a NASCAR fan, a smoker or a pet owner, or have a gold credit card. Some of that information comes from commercial marketing firms, product registration cards or surveys. Other information is obtained through Facebook, door-to-door canvassing, petitions and computer cookies – small data codes that register which websites the user has visited.
Through data modeling, analyzers can categorize voters based on how they feel about specific issues, values or candidates. They then try to predict voting behavior and figure out which issue ads voters are most likely to be susceptible to – for instance ads on education, gun control or immigration.
One of the companies that requested the full Wisconsin voter database, Magellan Strategies, explains on its website that it conducts surveys on people’s opinions and merges that with their political, consumer and census demographics.
“By correlating respondents’ demographics to the demographics of the whole voting district, we can make predictions about the voting preferences of each voter in the district,” the site states.
The company also states why the strategy is so popular.
“Microtargeting enables campaigns to send targeted messages to voters who are very receptive to those messages,” the website states. “Microtargeting allows for the most cost effective voter targeting programs, for voter persuasion or get-out-the-vote.”
According to its website, Magellan has conducted microtargeting since 2008.
A little extra effort is required to determine party affiliation in Wisconsin which, contrary to other states such as California, does not register people to vote by party.
The last piece of the puzzle is the phone number, which is not available through the government, but easily found in a phone book or located in online databases, sometimes free of charge.
Nathan Conrad, a spokesman for the Republican Party of Wisconsin, did not respond to a request for comment on how the campaign obtained Trulen’s digits. Graeme Zielinski, a spokesman for the Democratic Party of Wisconsin, did not respond for requests on how his party obtains phone numbers either.
As for Trulen, she just wishes she could find a way to make the calls stop.
“It’s alarming to me,” she said. “It’s just not right. . . . It’s like you can feel the tentacles creeping into your house under your door.”
The calls to Trulen were likely part of the GOP’s effort to get out the vote in what the party considers one of its strongest counties. Waukesha County is traditionally a Republican stronghold, just as Milwaukee tends to go for Democrats.
The irony is that the robocallers apparently haven’t figured out Trulen is actually a minority in her county: She has been voting Democratic.
Big Brother
Political campaigns can obtain nearly unlimited information about people through commercially available databases. Here’s what information they can, and can’t, learn about you from public records related to voting:
Public (obtainable)
Your name, address, gender and race
Which elections you voted in, going back to 2000
Whether you have requested an absentee ballot and whether you have sent it in.
Private (redacted)
Whom you voted for
Your date of birth
Your Social Security number, and any part of it
Your driver’s license number
Your phone number (if officials remember to redact it before they release your registration to anyone who asks.)
Online
For more on the information that campaigns and others collect on you, watch this video from PBS.
They then use various means of communication—direct mail, phone calls, home visits, television, radio, web advertising, email, text messaging, etc.–to communicate with voters, crafting messages to build support for fundraising, campaign events, volunteering, and eventually to turn them out to the polls on election day. Microtargeting’s tactics rely on transmitting a tailored message to a subgroup of the electorate on the basis of unique information about that subgroup.
History
Although some of the tactics of microtargeting had been used in California since 1992, it really started to be used nationally only in 2004.[1] In that year, Karl Rove, along with Blaise Hazelwood at the Republican National Committee, used it to reach voters in 18 states that George W. Bush’s reelection campaign was not able to reach by other means. The results were greater contacts with likely Bush voters. For example, in Iowa the campaign was able to reach 92% of eventual Bush voters (compared to 50% in 2000) and in Florida it was able to reach 84% (compared to 50% in 2000).[2] Much of this pioneering work was done by Alex Gage and his firm, TargetPoint Consulting.
Democrats did only limited microtargeting in 2004, with some crediting microtargeting for Kerry’s win in Iowa in 2004.[3] Some news accounts credited Republican superiority in that area for victories in that election cycle.[4] Democrats later developed microtargeting capabilities for the 2006 election cycle.[1][2] “It’s no secret that the other side [Republicans] figured this out a little sooner”, said Josh Syrjamaki, director of the Minnesota chapter of America Votes in October 2006. “They’ve had four to six years’ jump on us on this stuff…but we feel like we can start to catch up.”[5]
Method
Microtargeting is a modification of a practice used by commercial direct marketers. It would not be possible on a large scale without the development of large and sophisticated databases that contain data about as many voters as possible. The database essentially tracks voter habits in the same ways that companies like Visa track consumer spending habits. The Republican National Committee’s database is called Voter Vault. The Democratic National Committee effort is called VoteBuilder.[6] A parallel Democratic effort is being developed by Catalist, a $9 million initiative headed by Harold Ickes,[2] while the leading non-partisan database is offered by Aristotle.[7]
The databases contain specific information about a particular voter (party affiliation, frequency of voting, contributions, volunteerism, etc.) with other activities and habits available from commercial marketing vendors such as Acxiom, Dun & Bradstreet, Experian Americas, and InfoUSA. Such personal information is a “product” sold to interested companies. These data are particularly illuminating when portrayed through a Geographic Information System (GIS), where trends based on location can be mapped alongside dozens or hundreds of other variables. This geographic depiction also makes it ideal for volunteers to visit potential voters (armed with lists in hand, laid out in the shortest route – much like how FedEx and UPS pre-determine delivery routes).
These databases are then mined to identify issues important to each voter and whether that voter is more likely to identify with one party or another. Political information is obviously important here, but consumer preferences can play a role as well. Individual voters are then put into groups on the basis of sophisticated computer modeling. Such groups have names like “Downscale Union Independents”, “Tax and Terrorism Moderates,” and “Older Suburban Newshounds.”[2][5]
Once a multitude of voting groups is established according to these criteria and their minute political differences, then the tailored messages can be sent via the appropriate means. While political parties and candidates once prepared a single television advertisement for general broadcast nationwide, it is now not at all uncommon to have several dozen variations on the one message, each with a unique and tailored message for that small demographic sliver of the voting public. This is the same for radio advertisement, direct mail, email, as well as stump speeches and fundraising events.
The actual data mining task is the automatic or semi-automatic analysis of large quantities of data to extract previously unknown interesting patterns such as groups of data records (cluster analysis), unusual records (anomaly detection) and dependencies (association rule mining). This usually involves using database techniques such as spatial indices. These patterns can then be seen as a kind of summary of the input data, and may be used in further analysis or, for example, in machine learning and predictive analytics. For example, the data mining step might identify multiple groups in the data, which can then be used to obtain more accurate prediction results by a decision support system. Neither the data collection, data preparation, nor result interpretation and reporting are part of the data mining step, but do belong to the overall KDD process as additional steps.
The related terms data dredging, data fishing, and data snooping refer to the use of data mining methods to sample parts of a larger population data set that are (or may be) too small for reliable statistical inferences to be made about the validity of any patterns discovered. These methods can, however, be used in creating new hypotheses to test against the larger data populations.
Data mining uses information from past data to analyze the outcome of a particular problem or situation that may arise. Data mining works to analyze data stored in data warehouses that are used to store that data that is being analyzed. That particular data may come from all parts of business, from the production to the management. Managers also use data mining to decide upon marketing strategies for their product. They can use data to compare and contrast among competitors. Data mining interprets its data into real time analysis that can be used to increase sales, promote new product, or delete product that is not value-added to the company.
Etymology
In the 1960s, statisticians used terms like “Data Fishing” or “Data Dredging” to refer to what they considered the bad practice of analyzing data without an a-priori hypothesis. The term “Data Mining” appeared around 1990 in the database community. At the beginning of the century, there was a phrase “database mining”™, trademarked by HNC, a San Diego-based company (now merged into FICO), to pitch their Data Mining Workstation;[8] researchers consequently turned to “data mining”. Other terms used include Data Archaeology, Information Harvesting, Information Discovery, Knowledge Extraction, etc. Gregory Piatetsky-Shapiro coined the term “Knowledge Discovery in Databases” for the first workshop on the same topic (1989) and this term became more popular in AI and Machine Learning Community. However, the term data mining became more popular in the business and press communities.[9] Currently, Data Mining and Knowledge Discovery are used interchangeably.
Background
The manual extraction of patterns from data has occurred for centuries. Early methods of identifying patterns in data include Bayes’ theorem (1700s) and regression analysis (1800s). The proliferation, ubiquity and increasing power of computer technology has dramatically increased data collection, storage, and manipulation ability. As data sets have grown in size and complexity, direct “hands-on” data analysis has increasingly been augmented with indirect, automated data processing, aided by other discoveries in computer science, such as neural networks, cluster analysis, genetic algorithms (1950s), decision trees (1960s), and support vector machines (1990s). Data mining is the process of applying these methods with the intention of uncovering hidden patterns[10] in large data sets. It bridges the gap from applied statistics and artificial intelligence (which usually provide the mathematical background) to database management by exploiting the way data is stored and indexed in databases to execute the actual learning and discovery algorithms more efficiently, allowing such methods to be applied to ever larger data sets.
Research and evolution
The premier professional body in the field is the Association for Computing Machinery‘s (ACM) Special Interest Group (SIG) on Knowledge Discovery and Data Mining (SIGKDD). Since 1989 this ACM SIG has hosted an annual international conference and published its proceedings,[11] and since 1999 it has published a biannual academic journal titled “SIGKDD Explorations”.[12]
Computer science conferences on data mining include:
or a simplified process such as (1) pre-processing, (2) data mining, and (3) results validation.
Polls conducted in 2002, 2004, and 2007 show that the CRISP-DM methodology is the leading methodology used by data miners.[13][14][15] The only other data mining standard named in these polls was SEMMA. However, 3-4 times as many people reported using CRISP-DM. Several teams of researchers have published reviews of data mining process models,[16][17] and Azevedo and Santos conducted a comparison of CRISP-DM and SEMMA in 2008.[18]
Pre-processing
Before data mining algorithms can be used, a target data set must be assembled. As data mining can only uncover patterns actually present in the data, the target data set must be large enough to contain these patterns while remaining concise enough to be mined within an acceptable time limit. A common source for data is a data mart or data warehouse. Pre-processing is essential to analyze the multivariate data sets before data mining. The target set is then cleaned. Data cleaning removes the observations containing noise and those with missing data.
Data mining
Data mining involves six common classes of tasks:[1]
Anomaly detection (Outlier/change/deviation detection) – The identification of unusual data records, that might be interesting or data errors that require further investigation.
Association rule learning (Dependency modeling) – Searches for relationships between variables. For example a supermarket might gather data on customer purchasing habits. Using association rule learning, the supermarket can determine which products are frequently bought together and use this information for marketing purposes. This is sometimes referred to as market basket analysis.
Clustering – is the task of discovering groups and structures in the data that are in some way or another “similar”, without using known structures in the data.
Classification – is the task of generalizing known structure to apply to new data. For example, an e-mail program might attempt to classify an e-mail as “legitimate” or as “spam”.
Regression – Attempts to find a function which models the data with the least error.
Summarization – providing a more compact representation of the data set, including visualization and report generation.
Sequential pattern mining – Sequential pattern mining finds sets of data items that occur together frequently in some sequences. Sequential pattern mining, which extracts frequent subsequences from a sequence database, has attracted a great deal of interest during the recent data mining research because it is the basis of many applications, such as: web user analysis, stock trend prediction, DNA sequence analysis, finding language or linguistic patterns from natural language texts, and using the history of symptoms to predict certain kind of disease.
Results validation
The final step of knowledge discovery from data is to verify that the patterns produced by the data mining algorithms occur in the wider data set. Not all patterns found by the data mining algorithms are necessarily valid. It is common for the data mining algorithms to find patterns in the training set which are not present in the general data set. This is called overfitting. To overcome this, the evaluation uses a test set of data on which the data mining algorithm was not trained. The learned patterns are applied to this test set and the resulting output is compared to the desired output. For example, a data mining algorithm trying to distinguish “spam” from “legitimate” emails would be trained on a training set of sample e-mails. Once trained, the learned patterns would be applied to the test set of e-mails on which it had not been trained. The accuracy of the patterns can then be measured from how many e-mails they correctly classify. A number of statistical methods may be used to evaluate the algorithm, such as ROC curves.
If the learned patterns do not meet the desired standards, then it is necessary to re-evaluate and change the pre-processing and data mining steps. If the learned patterns do meet the desired standards, then the final step is to interpret the learned patterns and turn them into knowledge.
Standards
There have been some efforts to define standards for the data mining process, for example the 1999 European Cross Industry Standard Process for Data Mining (CRISP-DM 1.0) and the 2004 Java Data Mining standard (JDM 1.0). Development on successors to these processes (CRISP-DM 2.0 and JDM 2.0) was active in 2006, but has stalled since. JDM 2.0 was withdrawn without reaching a final draft.
For exchanging the extracted models – in particular for use in predictive analytics – the key standard is the Predictive Model Markup Language (PMML), which is an XML-based language developed by the Data Mining Group (DMG) and supported as exchange format by many data mining applications. As the name suggests, it only covers prediction models, a particular data mining task of high importance to business applications. However, extensions to cover (for example) subspace clustering have been proposed independently of the DMG.[19]
Since the early 1960s, with the availability of oracles for certain combinatorial games, also called tablebases (e.g. for 3×3-chess) with any beginning configuration, small-board dots-and-boxes, small-board-hex, and certain endgames in chess, dots-and-boxes, and hex; a new area for data mining has been opened. This is the extraction of human-usable strategies from these oracles. Current pattern recognition approaches do not seem to fully acquire the high level of abstraction required to be applied successfully. Instead, extensive experimentation with the tablebases – combined with an intensive study of tablebase-answers to well designed problems, and with knowledge of prior art (i.e. pre-tablebase knowledge) – is used to yield insightful patterns. Berlekamp (in dots-and-boxes, etc.) and John Nunn (in chessendgames) are notable examples of researchers doing this work, though they were not – and are not – involved in tablebase generation.
Business
Data mining is the analysis of historical business activities, stored as static data in data warehouse databases, to reveal hidden patterns and trends. Data mining software uses advanced pattern recognition algorithms to sift through large amounts of data to assist in discovering previously unknown strategic business information. Examples of what businesses use data mining for include performing market analysis to identify new product bundles, finding the root cause of manufacturing problems, to prevent customer attrition and acquire new customers, cross-sell to existing customers, and profile customers with more accuracy.[20] In today’s world raw data is being collected by companies at an exploding rate. For example, Walmart processes over 20 million point-of-sale transactions every day. This information is stored in a centralized database, but would be useless without some type of data mining software to analyse it. If Walmart analyzed their point-of-sale data with data mining techniques they would be able to determine sales trends, develop marketing campaigns, and more accurately predict customer loyalty.[21] Every time we use our credit card, a store loyalty card, or fill out a warranty card data is being collected about our purchasing behavior. Many people find the amount of information stored about us from companies, such as Google, Facebook, and Amazon, disturbing and are concerned about privacy. Although there is the potential for our personal data to be used in harmful, or unwanted, ways it is also being used to make our lives better. For example, Ford and Audi hope to one day collect information about customer driving patterns so they can recommend safer routes and warn drivers about dangerous road conditions.[22]
Data mining in customer relationship management applications can contribute significantly to the bottom line.[citation needed] Rather than randomly contacting a prospect or customer through a call center or sending mail, a company can concentrate its efforts on prospects that are predicted to have a high likelihood of responding to an offer. More sophisticated methods may be used to optimize resources across campaigns so that one may predict to which channel and to which offer an individual is most likely to respond (across all potential offers). Additionally, sophisticated applications could be used to automate mailing. Once the results from data mining (potential prospect/customer and channel/offer) are determined, this “sophisticated application” can either automatically send an e-mail or a regular mail. Finally, in cases where many people will take an action without an offer, “uplift modeling” can be used to determine which people have the greatest increase in response if given an offer. Uplift modeling thereby enables marketers to focus mailings and offers on persuadable people, and not to send offers to people who will buy the product without an offer. Data clustering can also be used to automatically discover the segments or groups within a customer data set.
Businesses employing data mining may see a return on investment, but also they recognize that the number of predictive models can quickly become very large. Rather than using one model to predict how many customers will churn, a business could build a separate model for each region and customer type. Then, instead of sending an offer to all people that are likely to churn, it may only want to send offers to loyal customers. Finally, the business may want to determine which customers are going to be profitable over a certain window in time, and only send the offers to those that are likely to be profitable. In order to maintain this quantity of models, they need to manage model versions and move on to automated data mining.
Data mining can also be helpful to human resources (HR) departments in identifying the characteristics of their most successful employees. Information obtained – such as universities attended by highly successful employees – can help HR focus recruiting efforts accordingly. Additionally, Strategic Enterprise Management applications help a company translate corporate-level goals, such as profit and margin share targets, into operational decisions, such as production plans and workforce levels.[23]
Another example of data mining, often called the market basket analysis, relates to its use in retail sales. If a clothing store records the purchases of customers, a data mining system could identify those customers who favor silk shirts over cotton ones. Although some explanations of relationships may be difficult, taking advantage of it is easier. The example deals with association rules within transaction-based data. Not all data are transaction based and logical, or inexact rules may also be present within a database.
Market basket analysis has also been used to identify the purchase patterns of the Alpha Consumer. Alpha Consumers are people that play a key role in connecting with the concept behind a product, then adopting that product, and finally validating it for the rest of society. Analyzing the data collected on this type of user has allowed companies to predict future buying trends and forecast supply demands.[citation needed]
Data mining is a highly effective tool in the catalog marketing industry.[citation needed] Catalogers have a rich database of history of their customer transactions for millions of customers dating back a number of years. Data mining tools can identify patterns among customers and help identify the most likely customers to respond to upcoming mailing campaigns.
Data mining for business applications is a component that needs to be integrated into a complex modeling and decision making process. Reactive business intelligence (RBI) advocates a “holistic” approach that integrates data mining, modeling, and interactive visualization into an end-to-end discovery and continuous innovation process powered by human and automated learning.[24]
In the area of decision making, the RBI approach has been used to mine knowledge that is progressively acquired from the decision maker, and then self-tune the decision method accordingly.[25]
An example of data mining related to an integrated-circuit (IC) production line is described in the paper “Mining IC Test Data to Optimize VLSI Testing.”[26] In this paper, the application of data mining and decision analysis to the problem of die-level functional testing is described. Experiments mentioned demonstrate the ability to apply a system of mining historical die-test data to create a probabilistic model of patterns of die failure. These patterns are then utilized to decide, in real time, which die to test next and when to stop testing. This system has been shown, based on experiments with historical test data, to have the potential to improve profits on mature IC products.
In the study of human genetics, sequence mining helps address the important goal of understanding the mapping relationship between the inter-individual variations in human DNA sequence and the variability in disease susceptibility. In simple terms, it aims to find out how the changes in an individual’s DNA sequence affects the risks of developing common diseases such as cancer, which is of great importance to improving methods of diagnosing, preventing, and treating these diseases. The data mining method that is used to perform this task is known as multifactor dimensionality reduction.[27]
In the area of electrical power engineering, data mining methods have been widely used for condition monitoring of high voltage electrical equipment. The purpose of condition monitoring is to obtain valuable information on, for example, the status of the insulation (or other important safety-related parameters). Data clustering techniques – such as the self-organizing map (SOM), have been applied to vibration monitoring and analysis of transformer on-load tap-changers (OLTCS). Using vibration monitoring, it can be observed that each tap change operation generates a signal that contains information about the condition of the tap changer contacts and the drive mechanisms. Obviously, different tap positions will generate different signals. However, there was considerable variability amongst normal condition signals for exactly the same tap position. SOM has been applied to detect abnormal conditions and to hypothesize about the nature of the abnormalities.[28]
Data mining methods have also been applied to dissolved gas analysis (DGA) in power transformers. DGA, as a diagnostics for power transformers, has been available for many years. Methods such as SOM has been applied to analyze generated data and to determine trends which are not obvious to the standard DGA ratio methods (such as Duval Triangle).[28]
Another example of data mining in science and engineering is found in educational research, where data mining has been used to study the factors leading students to choose to engage in behaviors which reduce their learning,[29] and to understand factors influencing university student retention.[30] A similar example of social application of data mining is its use in expertise finding systems, whereby descriptors of human expertise are extracted, normalized, and classified so as to facilitate the finding of experts, particularly in scientific and technical fields. In this way, data mining can facilitate institutional memory.
In adverse drug reaction surveillance, the Uppsala Monitoring Centre has, since 1998, used data mining methods to routinely screen for reporting patterns indicative of emerging drug safety issues in the WHO global database of 4.6 million suspected adverse drug reaction incidents.[34] Recently, similar methodology has been developed to mine large collections of electronic health records for temporal patterns associating drug prescriptions to medical diagnoses.[35]
Data mining of government records – particularly records of the justice system (i.e. courts, prisons) – enables the discovery of systemic human rights violations in connection to generation and publication of invalid or fraudulent legal records by various government agencies.[36][37]
Spatial data mining is the application of data mining methods to spatial data. The end objective of spatial data mining is to find patterns in data with respect to geography. So far, data mining and Geographic Information Systems (GIS) have existed as two separate technologies, each with its own methods, traditions, and approaches to visualization and data analysis. Particularly, most contemporary GIS have only very basic spatial analysis functionality. The immense explosion in geographically referenced data occasioned by developments in IT, digital mapping, remote sensing, and the global diffusion of GIS emphasizes the importance of developing data-driven inductive approaches to geographical analysis and modeling.
Data mining offers great potential benefits for GIS-based applied decision-making. Recently, the task of integrating these two technologies has become of critical importance, especially as various public and private sector organizations possessing huge databases with thematic and geographically referenced data begin to realize the huge potential of the information contained therein. Among those organizations are:
offices requiring analysis or dissemination of geo-referenced statistical data
public health services searching for explanations of disease clustering
environmental agencies assessing the impact of changing land-use patterns on climate change
geo-marketing companies doing customer segmentation based on spatial location.
Challenges in Spatial mining: Geospatial data repositories tend to be very large. Moreover, existing GIS datasets are often splintered into feature and attribute components that are conventionally archived in hybrid data management systems. Algorithmic requirements differ substantially for relational (attribute) data management and for topological (feature) data management.[39] Related to this is the range and diversity of geographic data formats, which present unique challenges. The digital geographic data revolution is creating new types of data formats beyond the traditional “vector” and “raster” formats. Geographic data repositories increasingly include ill-structured data, such as imagery and geo-referenced multi-media.[40]
There are several critical research challenges in geographic knowledge discovery and data mining. Miller and Han[41] offer the following list of emerging research topics in the field:
Developing and supporting geographic data warehouses (GDW’s): Spatial properties are often reduced to simple aspatial attributes in mainstream data warehouses. Creating an integrated GDW requires solving issues of spatial and temporal data interoperability – including differences in semantics, referencing systems, geometry, accuracy, and position.
Better spatio-temporal representations in geographic knowledge discovery: Current geographic knowledge discovery (GKD) methods generally use very simple representations of geographic objects and spatial relationships. Geographic data mining methods should recognize more complex geographic objects (i.e. lines and polygons) and relationships (i.e. non-Euclidean distances, direction, connectivity, and interaction through attributed geographic space such as terrain). Furthermore, the time dimension needs to be more fully integrated into these geographic representations and relationships.
Geographic knowledge discovery using diverse data types: GKD methods should be developed that can handle diverse data types beyond the traditional raster and vector models, including imagery and geo-referenced multimedia, as well as dynamic data types (video streams, animation).
Sensor data mining
Wireless sensor networks can be used for facilitating the collection of data for spatial data mining for a variety of applications such as air pollution monitoring.[42] A characteristic of such networks is that nearby sensor nodes monitoring an environmental feature typically register similar values. This kind of data redundancy due to the spatial correlation between sensor observations inspires the techniques for in-network data aggregation and mining. By measuring the spatial correlation between data sampled by different sensors, a wide class of specialized algorithms can be developed to develop more efficient spatial data mining algorithms.[43]
Visual data mining
In the process of turning from analogical into digital, large data sets have been generated, collected, and stored discovering statistical patterns, trends and information which is hidden in data, in order to build predictive patterns. Studies suggest visual data mining is faster and much more intuitive than is traditional data mining.[44][45][46] See also Computer Vision.
Music data mining
Data mining techniques, and in particular co-occurrence analysis, has been used to discover relevant similarities among music corpora (radio lists, CD databases) for the purpose of classifying music into genres in a more objective manner.[47]
Surveillance
Data mining has been used to stop terrorist programs under the U.S. government, including the Total Information Awareness (TIA) program, Secure Flight (formerly known as Computer-Assisted Passenger Prescreening System (CAPPS II)), Analysis, Dissemination, Visualization, Insight, Semantic Enhancement (ADVISE),[48] and the Multi-state Anti-Terrorism Information Exchange (MATRIX).[49] These programs have been discontinued due to controversy over whether they violate the 4th Amendment to the United States Constitution, although many programs that were formed under them continue to be funded by different organizations or under different names.[50]
In the context of combating terrorism, two particularly plausible methods of data mining are “pattern mining” and “subject-based data mining”.
Pattern mining
“Pattern mining” is a data mining method that involves finding existing patterns in data. In this context patterns often means association rules. The original motivation for searching association rules came from the desire to analyze supermarket transaction data, that is, to examine customer behavior in terms of the purchased products. For example, an association rule “beer ⇒ potato chips (80%)” states that four out of five customers that bought beer also bought potato chips.
In the context of pattern mining as a tool to identify terrorist activity, the National Research Council provides the following definition: “Pattern-based data mining looks for patterns (including anomalous data patterns) that might be associated with terrorist activity — these patterns might be regarded as small signals in a large ocean of noise.”[51][52][53] Pattern Mining includes new areas such a Music Information Retrieval (MIR) where patterns seen both in the temporal and non temporal domains are imported to classical knowledge discovery search methods.
Subject-based data mining
“Subject-based data mining” is a data mining method involving the search for associations between individuals in data. In the context of combating terrorism, the National Research Council provides the following definition: “Subject-based data mining uses an initiating individual or other datum that is considered, based on other information, to be of high interest, and the goal is to determine what other persons or financial transactions or movements, etc., are related to that initiating datum.”[52]
Knowledge grid
Knowledge discovery “On the Grid” generally refers to conducting knowledge discovery in an open environment using grid computing concepts, allowing users to integrate data from various online data sources, as well make use of remote resources, for executing their data mining tasks. The earliest example was the Discovery Net,[54][55] developed at Imperial College London, which won the “Most Innovative Data-Intensive Application Award” at the ACM SC02 (Supercomputing 2002) conference and exhibition, based on a demonstration of a fully interactive distributed knowledge discovery application for a bioinformatics application. Other examples include work conducted by researchers at the University of Calabria, who developed a Knowledge Grid architecture for distributed knowledge discovery, based on grid computing.[56][57]
Reliability / Validity
Data mining can be misused, and can also unintentionally produce results which appear significant but which do not actually predict future behavior and cannot be reproduced on a new sample of data. See Data snooping, Data dredging.
Privacy concerns and ethics
Some people believe that data mining itself is ethically neutral.[58] While the term “data mining” has no ethical implications, it is often associated with the mining of information in relation to peoples’ behavior (ethical and otherwise). To be precise, data mining is a statistical method that is applied to a set of information (i.e. a data set). Associating these data sets with people is an extreme narrowing of the types of data that are available. Examples could range from a set of crash test data for passenger vehicles, to the performance of a group of stocks. These types of data sets make up a great proportion of the information available to be acted on by data mining methods, and rarely have ethical concerns associated with them. However, the ways in which data mining can be used can in some cases and contexts raise questions regarding privacy, legality, and ethics.[59] In particular, data mining government or commercial data sets for national security or law enforcement purposes, such as in the Total Information Awareness Program or in ADVISE, has raised privacy concerns.[60][61]
Data mining requires data preparation which can uncover information or patterns which may compromise confidentiality and privacy obligations. A common way for this to occur is through data aggregation. Data aggregation involves combining data together (possibly from various sources) in a way that facilitates analysis (but that also might make identification of private, individual-level data deducible or otherwise apparent).[62] This is not data mining per se, but a result of the preparation of data before – and for the purposes of – the analysis. The threat to an individual’s privacy comes into play when the data, once compiled, cause the data miner, or anyone who has access to the newly compiled data set, to be able to identify specific individuals, especially when the data were originally anonymous.
It is recommended that an individual is made aware of the following before data are collected:[62]
the purpose of the data collection and any (known) data mining projects
how the data will be used
who will be able to mine the data and use the data and their derivatives
the status of security surrounding access to the data
how collected data can be updated.
In America, privacy concerns have been addressed to some extent by the US Congress via the passage of regulatory controls such as the Health Insurance Portability and Accountability Act (HIPAA). The HIPAA requires individuals to give their “informed consent” regarding information they provide and its intended present and future uses. According to an article in Biotech Business Week’, “‘[i]n practice, HIPAA may not offer any greater protection than the longstanding regulations in the research arena,’ says the AAHC. More importantly, the rule’s goal of protection through informed consent is undermined by the complexity of consent forms that are required of patients and participants, which approach a level of incomprehensibility to average individuals.”[63] This underscores the necessity for data anonymity in data aggregation and mining practices.
Data may also be modified so as to become anonymous, so that individuals may not readily be identified.[62] However, even “de-identified”/”anonymized” data sets can potentially contain enough information to allow identification of individuals, as occurred when journalists were able to find several individuals based on a set of search histories that were inadvertently released by AOL.[64]
KNIME: The Konstanz Information Miner, a user friendly and comprehensive data analytics framework.
ML-Flex: A software package that enables users to integrate with third-party machine-learning packages written in any programming language, execute classification analyses in parallel across multiple computing nodes, and produce HTML reports of classification results.
NLTK (Natural Language Toolkit): A suite of libraries and programs for symbolic and statistical natural language processing (NLP) for the Python language.
SenticNet API: A semantic and affective resource for opinion mining and sentiment analysis.
UIMA: The UIMA (Unstructured Information Management Architecture) is a component framework for analyzing unstructured content such as text, audio and video – originally developed by IBM.
Weka: A suite of machine learning software applications written in the Java programming language.
IBM DB2 Intelligent Miner: in-database data mining platform provided by IBM, with modeling, scoring and visualization services based on the SQL/MM – PMML framework.
LIONsolver: an integrated software application for data mining, business intelligence, and modeling that implements the Learning and Intelligent OptimizatioN (LION) approach.
Holsys One: Tool for the analysis of complex systems (sensors network, industrial plant) based on a reinterpretation of the IF-THEN clause in the sense of the theory of holons.
Marketplace surveys
Several researchers and organizations have conducted reviews of data mining tools and surveys of data miners. These identify some of the strengths and weaknesses of the software packages. They also provide an overview of the behaviors, preferences and views of data miners. Some of these reports include:
2011 Wiley Interdisciplinary Reviews: Data Mining and Knowledge Discovery[65]
The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.
~United States Constitution, Amendment IV
“He who controls the past controls the future. He who controls the present controls the past.”
“Now I will tell you the answer to my question. It is this. The Party seeks power entirely for its own sake. We are not interested in the good of others; we are interested solely in power, pure power. What pure power means you will understand presently. We are different from the oligarchies of the past in that we know what we are doing. All the others, even those who resembled ourselves, were cowards and hypocrites. The German Nazis and the Russian Communists came very close to us in their methods, but they never had the courage to recognize their own motives. They pretended, perhaps they even believed, that they had seized power unwillingly and for a limited time, and that just around the corner there lay a paradise where human beings would be free and equal. We are not like that. We know what no one ever seizes power with the intention of relinquishing it. Power is not a means; it is an end. One does not establish a dictatorship in order to safeguard a revolution; one makes the revolution in order to establish the dictatorship. The object of persecution is persecution. The object of torture is torture. The object of power is power. Now you begin to understand me.”
“Big Brother is Watching You.”
~George Orwell’s 1984
POWER IS NOT A MEANS, IT IS AN END
Maxine Waters Confirms Big Brother Database 2013 Foretells NSA Phone & Internet Spying
Glenn Beck:Govt Storing Citizen Cellphone& Internet Activity
Digital Blackwater: How the NSA Gives Private Contractors Control of the Surveillance State
Glenn Greenwald on How NSA Leaker Edward Snowden Helped Expose a “Massive Surveillance Apparatus”
What You Should Know About The New NSA Utah Data Center
Is Edward Snowden a Hero? A Debate With Journalist Chris Hedges & Law Scholar Geoffrey Stone
Spying On Americans By NSA Prism Collection Details – Rand Paul On Hannity
NSA is Spying on EVERYTHING you do. Phone calls and internet activity is being stored and monitored.
PRISM: Why the NSA is Mining Internet Data
Total Surveillance : N.S.A. data mining all computers, phone calls, internet, emails
CNET Update – Uproar over PRISM government surveillance
NSA Caught Spying on Americans’ Internet Use
Columnist exposes Obama surveillance
Meet Edward Snowden: NSA PRISM Whistleblower
Sky News interview w/ Julian Assange and JP Barlow RE: Prism and Edward Snowden
Complete News – Snowden leaks show NSA ‘routinely lies’ to Congress
Judge Napolitano On NSA Spying: Most Extraordinarily Broad Search Warrant Ever Issued In US History
Rand Paul Discusses The NSA’s Violation Of The Bill Of Rights On Yahoo News (6-6-13)
Rand Paul On NSA Spying: ‘I’m Going To Challenge This At The Supreme Court’ -
Ron Paul: NSA Seizing Phone Records Symptom of Failure of The State
NSA Constitutional Violations? – Judge Andrew Napolitano – Geraldo
Clever Denials Surrounding the NSA PRISM Piracy Scandal
Peter Eckersley from the Electronic Frontier Foundation stopped by to explain why Silicon Vally’s top tech companies are dancing around PRISM allegations. Interview recorded Friday June 7, 2013
NSA Surveillance – Does Obama Have ANY Credibility Left?
“In his remarks today defending the NSA programs gathering telephone records and mining Internet companies, Obama sounded a familiar refrain, saying he welcomes the “debate” over the proper balance between civil liberties and national security.”*
Obama gave a speech in defense of recently uncovered secret programs to wiretap and data-mine U.S. citizens almost indiscriminately, and Congress agrees. Do you believe his remarks that we NEED these programs? Would Obama agree with himself campaigning about his stance on civil rights? Cenk Uygur, Ben Mankiewicz, and John Iadarola discuss.
How PRISM Easily Gives Your Private Data Over to Big Brother
The National Security Agency has obtained direct access to the systems of Google, Facebook, Apple and other US internet giants, according to a top secret document obtained by the Guardian.
The NSA access is part of a previously undisclosed program called Prism, which allows officials to collect material including search history, the content of emails, file transfers and live chats, the document says.”*
We’ve been assured by the president that the NSA’s PRISM program won’t affect “ordinary” U.S. citizens, but what is the criteria for deciding who gets their data mined and monitored? Cenk Uygur, Ben Mankiewicz, and John Iadarola (Host, TYT University) discuss the egregious reach of the Obama administration’s secret mass surveillance program.
The federal government is launching an expansive program dubbed “Perfect Citizen” to detect cyber assaults on private companies and government agencies running such critical infrastructure as the electricity grid and nuclear-power plants, according to people familiar with the program.The surveillance by the National Security Agency, the government’s chief eavesdropping agency, would rely on a set of sensors deployed in computer networks for critical infrastructure that would be triggered by unusual activity suggesting an impending cyber attack, though it wouldn’t persistently monitor the whole system, these people said.
Defense contractor Raytheon Corp. recently won a classified contract for the initial phase of the surveillance effort valued at up to $100 million, said a person familiar with the project.
An NSA spokeswoman said the agency had no information to provide on the program. A Raytheon spokesman declined to comment.
Some industry and government officials familiar with the program see Perfect Citizen as an intrusion by the NSA into domestic affairs, while others say it is an important program to combat an emerging security threat that only the NSA is equipped to provide.
“The overall purpose of the [program] is our Government…feel[s] that they need to insure the Public Sector is doing all they can to secure Infrastructure critical to our National Security,” said one internal Raytheon email, the text of which was seen by The Wall Street Journal. “Perfect Citizen is Big Brother.”
Glenn Becks “SURVEILLANCE STATE” (Must Viewing)
NSA spying on All Americans Part 1
NSA spying on All Americans Part 2
How to Protect Yourself from The NSA
NSA Whistleblower Seeks Asylum in Iceland
Former CIA Officer: Officials Considering NSA Whistleblower’s Case Potential Chinese Espionage
Judge Jeanine Slams IRS, NSA and Obama for Expanding Surveillance Program – Opening Statement
James Bamford: Inside the NSA’s Largest and Most Expansive Secret Domestic Spy Center 1 of 2
James Bamford: Inside the NSA’s Largest and Most Expansive Secret Domestic Spy Center 2 of 2
NSA Whistleblower: Everyone in US under virtual surveillance, all info stored, no matter the post
“The NSA Is Lying”: U.S. Government Has Copies of Most of Your Emails Says NSA Whistleblower
NSA whistleblower William Binney Keynote at HOPE Number Nine
U.S. v. Whistleblower Tom Drake
Tom Drake, a former NSA senior executive indicted last year for espionage after leaking to the media allegations that the nation’s largest intelligence organization had committed fraud, waste and abuse will appear in his first television interview. Scott Pelley reports.
Whistle Blower Threatened with 35 Years in Prison, Warns of Developing Tyranny
NSA Whistleblower Thomas Drake Prevails in Unprecedented Obama Admin Crackdown
NSA Whistleblower Thomas Drake speaks at National Press Club – March 15, 2013
Part 2: Former NSA Employee Thomas Drake and Jesselyn Radack on Whistleblower Crackdown
The Police – Every Breath You Take
“When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.–That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, –That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. …”
Domestic Spying, Mainstream Source – NSA, Internet Spying, AT&T
Domestic Spying, Mainstream Source – NSA Copying Entire Internet
Glenn Becks “SURVEILLANCE STATE”
Barack Obama’s Surveillance Society
GLENN BECK ‘They Are Liars’
Glenn Greenwald: Challenging the US Surveillance State
2012.05.01 – GBTV – The Glenn Beck Radio Program – NSA Warning
Project Vigilant: Shadowy Spy Group Building Dossiers On Internet Users For Feds – Alex Jones Tv 3/3
Total Information Awareness – Social Networking Sites (mirror)
The Information Awareness Office (IAO) was established by the Defense Advanced Research Projects Agency (DARPA) in January 2002 to bring together several DARPA projects focused on applying surveillance and information technology to track and monitor terrorists and other asymmetric threats to national security, by achieving Total Information Awareness (TIA). This would be achieved by creating enormous computer databases to gather and store the personal information of everyone in the United States, including personal e-mails, social networks, credit card records, phone calls, medical records, and numerous other sources including, without any requirement for a search warrant.[1] This information would then be analyzed to look for suspicious activities, connections between individuals, and “threats”.[2] Additionally, the program included funding for biometric surveillance technologies that could identify and track individuals using surveillance cameras, and other methods.[2]
Following public criticism that the development and deployment of these technologies could potentially lead to a mass surveillance system, the IAO was defunded by Congress in 2003. However, several IAO projects continued to be funded, and merely run under different names.
ThinThread
ThinThread is the name of a project that the United StatesNational Security Agency (NSA) pursued during the 1990s, according to a May 17, 2006 article in The Baltimore Sun.[1] The program involved wiretapping and sophisticated analysis of the resulting data, but according to the article, the program was discontinued after the September 11, 2001 attacks due to the changes in priorities and the consolidation of U.S. intelligence authority. The “change in priority” consisted of the decision made by the director of NSA General Michael V. Hayden to go with a concept called Trailblazer, despite the fact that ThinThread was a working prototype that protected the privacy of U.S. citizens.
Redacted version of the DoD Inspector General audit, obtained through FOIA[4][5]
A group of former NSA workers — Kirk Wiebe, William Binney, Ed Loomis, and Thomas A. Drake, along with House Intelligence Committee staffer Diane Roark (an expert on the NSA budget[6]) — believed the operational prototype system called ThinThread was a better solution than Trailblazer, which was just a concept on paper at the time. They complained to the DoD Inspector General office in 2002 about mismanagement and the waste of taxpayer money at the NSA surrounding the Trailblazer program. In 2007 the FBI raided the homes of these people, an evolution of President Bush’s crackdown on whistleblowers and “leaks” after the New York Times disclosed a separate program (see NSA warrantless surveillance controversy). In 2010, one of the people who had helped the IG in the ensuing investigation, NSA official Thomas Andrews Drake, was charged with espionage,[6][7] part of the Obama administration’s crackdown on whistleblowers and “leaks”.[7][8][9] The original charges against him were later dropped and he pled to a misdemeanor.
The result of the DoD IG complaint was a 2004 audit report that was released under FOIA in 2011.[5] Although highly redacted, the report contained significant criticisms of Trailblazer, and included some relatively minor criticisms of ThinThread, for example, citing a low “quality of service and support” from the ThinThread program team, a lack of documentation, a lack of a configuration management system, and a lack of a trouble ticket system. However, “The findings that led to the recommendations would not have prevented the successful deployment of THINTHREAD … the recommendations were made to improve the operational efficiency of THINTHREAD after it was deployed …”[10]
Technical details
The program would have used a technique of encrypting sensitive privacy information in order to comply with legal concerns, and would have automatically identified potential threats. The sources of the data for this program would have included “massive phone and e-mail data,” but the extent of this information is not clear. Only once a threat was discovered, would the data be decrypted for analysis by agents.[11]
ThinThread would have bundled together four cutting-edge surveillance tools.:[citation needed]
Used more sophisticated methods of sorting through massive phone and e-mail data to identify suspect communications.
Identified U.S. phone numbers and other communications data and encrypted them to ensure caller privacy.
Employed an automated auditing system to monitor how analysts handled the information, in order to prevent misuse and improve efficiency.
Analyzed the data to identify relationships between callers and chronicle their contacts. Only when evidence of a potential threat had been developed would analysts be able to request decryption of the records.
Intelligence experts describe as rigorous testing of ThinThread in 1998, the project succeeded at each task with high marks. For example, its ability to sort through massive amounts of data to find threat-related communications far surpassed the existing system. It also was able to rapidly separate and encrypt U.S.-related communications to ensure privacy.[1]
The Pentagon report concluded that ThinThread’s ability to sort through data in 2001 was far superior to that of another NSA system in place in 2004, and that the program should be launched and enhanced. ThinThread was designed to address two key challenges: One, the NSA had more information than it could digest, and, two, increasingly its targets were in contact with people in the United States whose calls the agency was prohibited from monitoring.[citation needed]
Trailblazer Project had more political support internally because it was initiated by Michael Hayden when he first arrived at the NSA.[citation needed]
NSA’s existing system for data-sorting has produced a database clogged with corrupted and useless information. The mass collection of relatively unsorted data, combined with system flaws erroneously flag people as suspect, has produced numerous false leads, draining analyst resources. NSA leads have resulted in numerous dead ends.[citation needed]
NSA dropped the component that monitored for abuse of records. It not only tracked the use of the database, but hunted for the most effective analysis techniques, and some analysts thought it would be used to judge their performance. Within the NSA, the primary advocate for the ThinThread program was Richard Taylor. Taylor has retired from the NSA. The strength of ThinThread’s approach is that by encrypting information on Americans, it is legal regardless of whether the country is at war.[citation needed]
ThinThread “was designed very carefully from a legal point of view, so that even in non-wartime, you could have done it legitimately.”[12]
End of the project
The project was ended after successful testing by General Michael Hayden, and while the privacy elements were not retained, the analysis technology is reported to be the underlying basis of current NSA analysis techniques.
“They basically just disabled the [privacy] safeguards.”[11] [That quote does not appear in the link]
Some anonymous NSA officials told Hosenball of Newsweek that the ThinThread program, like Trailblazer, was a “wasteful failure”.[6]
Drake was interviewed on The Daily Show on August 6, 2012 about his charges and the program with his lawyer.
Trailblazer was a United States National Security Agency (NSA) program intended to develop a capability to analyze data carried on communications networks like the Internet. It was intended to track entities using communication methods such as cell phones and e-mail.[1][2] It ran over budget, failed to accomplish critical goals, and was cancelled.
NSA whistleblowers J. Kirk Wiebe, William Binney, Ed Loomis, and House Permanent Select Committee on Intelligence staffer Diane Roark complained to the Department of Defense’s Inspector General (IG) about waste, fraud, and abuse in the program, and the fact that a successful operating prototype existed, but was ignored when the Trailblazer program was launched. The complaint was accepted by the IG and an investigation began that lasted until mid-2005 when the final results were issued. The results were largely hidden, as the report given to the public was heavily (90%) redacted, while the original report was heavily classified, thus restricting the ability of most people to see it.
The people who filed the IG complaint were later raided by armed Federal Bureau of Investigation (FBI) agents. While the Government threatened to prosecute all who signed the IG report, it ultimately chose to pursue an NSA Senior Executive — Thomas Andrews Drake — who helped with the report internally to NSA and who had spoken with a reporter about the project. Drake was later charged under the Espionage Act of 1917. His defenders claimed this was retaliation.[3][4] The charges against him were later dropped, and he agreed to plead guilty to having committed a misdemeanor under the Computer Fraud and Abuse Act, something that Jesselyn Radack of the Government Accountability Project (which helped represent him) called an “act of civil disobedience“.[5]
In 2002 a consortium led by Science Applications International Corporation was chosen by the NSA to produce a technology demonstration platform in a contract worth $280 million. Project participants included Boeing, Computer Sciences Corporation, and Booz Allen Hamilton. The project was overseen by NSA Deputy Director William B. Black, Jr., an NSA worker who had gone to SAIC, and then been re-hired back to NSA by NSA director Michael Hayden in 2000.[6][7][8] SAIC had also hired a former NSA director to its management; Bobby Inman.[9] SAIC also participated in the concept definition phase of Trailblazer.[10][11]
The NSA Inspector General issued a report on Trailblazer that “discussed improperly based contract cost increases, non-conformance in the management of the Statement of Work, and excessive labor rates for contractor personnel.” [13]
In 2004 the DoD IG report criticized the program (see the Whistleblowing section below). It said that the “NSA ‘disregarded solutions to urgent national security needs’” and “that TRAILBLAZER was poorly executed and overly expensive …” Several contractors for the project were worried about cooperating with DoD’s audit for fear of “management reprisal.”[5] The Director of NSA “nonconcurred” with several statements in the IG audit, and the report contains a discussion of those disagreements.[14]
In 2005, NSA director Michael Hayden told a Senate hearing that the Trailblazer program was several hundred million dollars over budget and years behind schedule.[15] In 2006 the program was shut down,[3] after having cost billions of US Dollars.[16] Several anonymous NSA sources told Hosenball of Newsweek later on that the project was a “wasteful failure”.[17]
The new project replacing Trailblazer is called Turbulence.[3]
Whistleblowing
According to a 2011 New Yorker article, in the early days of the project several NSA employees met with Diane S Roark, an NSA budget expert on the House Intelligence Committee. They aired their grievances about Trailblazer. In response, NSA director Michael Hayden sent out a memo saying that “individuals, in a session with our congressional overseers, took a position in direct opposition to one that we had corporately decided to follow … Actions contrary to our decisions will have a serious adverse effect on our efforts to transform N.S.A., and I cannot tolerate them.”[3]
In September 2002, several people filed a complaint with the Department of Defense IG’s office regarding problems with Trailblazer: they included Roark (aforementioned), ex-NSA senior analysts Bill Binney, Kirk Wiebe, and Senior Computer Systems Analyst Ed Loomis, who had quit the agency over concerns about its mismanagement of acquisition and allegedly illegal domestic spying.[3][18][19] A major source for the report was NSA senior officer Thomas Andrews Drake. Drake had been complaining to his superiors for some time about problems at the agency, and about the superiority of ThinThread over Trailblazer, for example, at protecting privacy.[19] Drake gave info to DoD during its investigation of the matter.[19] Roark also went to her boss at the House committee, Porter Goss, about problems, but was rebuffed.[20] She also attempted to contact William Renquist, the Supreme Court Chief Justice at the time.[19]
Drake’s own boss, Maureen Baginski, the third-highest officer at NSA, quit partly over concerns about the legality of its behavior.[3]
In 2003, the NSA IG (not the DoD IG)[19] had declared Trailblazer an expensive failure.[21] It had cost more than $1 billion.[8][22][23]
In 2005, the DoD IG produced a report on the result of its investigation of the complaint of Roark and the others in 2002. This report was not released to the public, but it has been described as very negative.[18] Mayer writes that it hastened the closure of Trailblazer, which was at the time in trouble from congress for being over budget.[3]
In November 2005, Drake contacted Siobhan Gorman, a reporter of The Baltimore Sun.[24][17][25] Gorman wrote several articles about problems at the NSA, including articles on Trailblazer. This series got her an award from the Society of Professional Journalists.[17]
In 2005, President George W. Bush ordered the FBI to find whoever had disclosed information about the NSA electronic surveillance program and its disclosure in the New York Times. Eventually, this investigation led to the people who had filed the 2002 DoD IG request, even though they had nothing to do with the New York Times disclosure. In 2007, the houses of Roark, Binney, and Wiebe were raided by armed FBI agents. According to Mayer, Binney claims the FBI pointed guns at his head and that of his wife. Wiebe said it reminded him of the Soviet Union.[3][18] None of these people were ever charged with any crime. Four months later, Drake was raided in November 2007 and his computers and documents were confiscated.
In 2010 Drake was indicted by the U.S. Department of Justice on charges of obstructing justice, providing false information, and violating the Espionage Act of 1917,[17][26][27] part of President Barack Obama‘s crackdown on whistleblowers and “leakers”.[24][17][28][18] The government tried to get Roark to testify to a conspiracy, and made similar requests to Drake, offering him a plea bargain. They both refused.[3]
In June 2011, the ten original charges against Drake were dropped, instead he pleaded guilty to a misdemeanor.[5]
ECHELON is a name used in global media and in popular culture to describe a signals intelligence (SIGINT) collection and analysis network operated on behalf of the five signatory states to the UKUSA Security Agreement[1] (Australia, Canada, New Zealand, the United Kingdom, and the United States, referred to by a number of abbreviations, including AUSCANNZUKUS[1] and Five Eyes).[2][3] It has also been described as the only software system which controls the download and dissemination of the intercept of commercial satellite trunk communications.[4]
ECHELON, according to information in the European Parliament document, “On the existence of a global system for the interception of private and commercial communications (ECHELON interception system)” was created to monitor the military and diplomatic communications of the Soviet Union and its Eastern Bloc allies during the Cold War in the early 1960s.[5]
The system has been reported in a number of public sources.[6] Its capabilities and political implications were investigated by a committee of the European Parliament during 2000 and 2001 with a report published in 2001,[5] and by author James Bamford in his books on the National Security Agency of the United States.[4] The European Parliament stated in its report that the term ECHELON is used in a number of contexts, but that the evidence presented indicates that it was the name for a signals intelligence collection system. The report concludes that, on the basis of information presented, ECHELON was capable of interception and content inspection of telephone calls, fax, e-mail and other data traffic globally through the interception of communication bearers including satellite transmission, public switched telephone networks (which once carried most Internet traffic) and microwave links.[5]
Bamford describes the system as the software controlling the collection and distribution of civilian telecommunications traffic conveyed using communication satellites, with the collection being undertaken by ground stations located in the footprint of the downlink leg.
The UKUSA intelligence community was assessed by the European Parliament (EP) in 2000 to include the signals intelligence agencies of each of the member states:
The EP report concluded that it seemed likely that ECHELON is a method of sorting captured signal traffic, rather than a comprehensive analysis tool.[5]
Capabilities
The ability to intercept communications depends on the medium used, be it radio, satellite, microwave, cellular or fiber-optic.[5] During World War II and through the 1950s, high frequency (“short wave”) radio was widely used for military and diplomatic communication,[7] and could be intercepted at great distances.[5] The rise of geostationary communications satellites in the 1960s presented new possibilities for intercepting international communications. The report to the European Parliament of 2001 states: “If UKUSA states operate listening stations in the relevant regions of the earth, in principle they can intercept all telephone, fax and data traffic transmitted via such satellites.”[5]
The role of satellites in point-to-point voice and data communications has largely been supplanted by fiber optics; in 2006, 99% of the world’s long-distance voice and data traffic was carried over optical-fiber.[8] The proportion of international communications accounted for by satellite links is said to have decreased substantially over the past few years[when?] in Central Europe to an amount between 0.4% and 5%.[5] Even in less-developed parts of the world, communications satellites are used largely for point-to-multipoint applications, such as video.[9] Thus, the majority of communications can no longer be intercepted by earth stations; they can only be collected by tapping cables and intercepting line-of-sight microwave signals, which is possible only to a limited extent.[5]
One method of interception is to place equipment at locations where fiber optic communications are switched. For the Internet, much of the switching occurs at relatively few sites. There have been reports of one such intercept site, Room 641A, in the United States. In the past[when?] much Internet traffic was routed through the U.S. and the UK, but this has changed; for example, in 2000, 95% of intra-German Internet communications was routed via the DE-CIXInternet exchange point in Frankfurt.[5] A comprehensive worldwide surveillance network is possible only if clandestine intercept sites are installed in the territory of friendly nations, and/or if local authorities cooperate. The report to the European Parliament points out that interception of private communications by foreign intelligence services is not necessarily limited to the U.S. or British foreign intelligence services.[5]
Most reports on ECHELON focus on satellite interception; testimony before the European Parliament indicated that separate but similar UK-US systems are in place to monitor communication through undersea cables, microwave transmissions and other lines.[10]
Controversy
Intelligence monitoring of citizens, and their communications, in the area covered by the AUSCANNZUKUS security agreement has caused concern. British journalist Duncan Campbell and New Zealand journalist Nicky Hager asserted in the 1990s that the United States was exploiting ECHELON traffic for industrial espionage, rather than military and diplomatic purposes.[10] Examples alleged by the journalists include the gear-less wind turbine technology designed by the German firm Enercon[5][11] and the speech technology developed by the Belgian firm Lernout & Hauspie.[12] An article in the US newspaper Baltimore Sun reported in 1995 that European aerospace company Airbus lost a $6 billion contract with Saudi Arabia in 1994 after the US National Security Agency reported that Airbus officials had been bribing Saudi officials to secure the contract.[13][14]
In 2001, the Temporary Committee on the ECHELON Interception System recommended to the European Parliament that citizens of member states routinely use cryptography in their communications to protect their privacy, because economic espionage with ECHELON has been conducted by the US intelligence agencies.[5]
Bamford provides an alternative view, highlighting that legislation prohibits the use of intercepted communications for commercial purposes, although he does not elaborate on how intercepted communications are used as part of an all-source intelligence process.
Hardware
According to its website, the U.S. National Security Agency (NSA) is “a high technology organization … on the frontiers of communications and data processing”. In 1999 the Australian Senate Joint Standing Committee on Treaties was told by Professor Desmond Ball that the Pine Gap facility was used as a ground station for a satellite-based interception network. The satellites were said to be large radio dishes between 20 and 100 meters in diameter in geostationary orbits.[citation needed] The original purpose of the network was to monitor the telemetry from 1970s Soviet weapons, air defence radar, communications satellites and ground based microwave communications.[15]
Name
The European Parliament’s Temporary Committee on the ECHELON Interception System stated: “It seems likely, in view of the evidence and the consistent pattern of statements from a very wide range of individuals and organisations, including American sources, that its name is in fact ECHELON, although this is a relatively minor detail.”[5] The U.S. intelligence community uses many code names (see, for example, CIA cryptonym).
Former NSA employee Margaret Newsham claims that she worked on the configuration and installation of software that makes up the ECHELON system while employed at Lockheed Martin, for whom she worked from 1974 to 1984 in Sunnyvale, California, US, and in Menwith Hill, England, UK.[16] At that time, according to Newsham, the code name ECHELON was NSA’s term for the computer network itself. Lockheed called it P415. The software programs were called SILKWORTH and SIRE. A satellite named VORTEX intercepted communications. An image available on the internet of a fragment apparently torn from a job description shows Echelon listed along with several other code names.[17]
Ground stations
The 2001 European Parliamentary (EP) report[5] lists several ground stations as possibly belonging to, or participating in, the ECHELON network. These include:
Likely satellite intercept stations
The following stations are listed in the EP report (p. 54 ff) as likely to have, or to have had, a role in intercepting transmissions from telecommunications satellites:
Required reading for all lovers of liberty and capitalism. Recommend all Americans read this book.
How Brian Doherty Became a Libertarian
Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement
Featuring the author, Brian Doherty; with comments by E. J. Dionne Jr., Columnist, Washington Post, Senior Fellow, Brookings Institution; and moderator David Boaz, Executive Vice President, Cato Institute, Author, Libertarianism: A Primer.
For the first time, the history of the modern libertarian movement is presented in one comprehensive book. Reason editor Brian Doherty has pored through archives across the country and conducted dozens of interviews. The result is a book that moves smoothly from the ideas of Ludwig von Mises, Ayn Rand, and F. A. Hayek to the growth of libertarian think tanks to the factional feuds within the Libertarian Party. Every reader, no matter how well informed, will learn things from this book. Radicals for Capitalism will take its place alongside other key books about American ideological and political movements. Don’t miss the unveiling of this impressive book.
Conservatism vs Libertarianism – Brian Doherty
Reason Magazine Senior Editor Brian Doherty discusses the differences between libertarianism and traditional conservative ideologies.
—–
Brian Doherty considers “Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement.”
This illuminating, lively history of a political movement on the rise – told through the life stories of its standard bearers – casts new light on the intellectual and political history of post-WWII America. Doherty traces the evolution of libertarianism through the unconventional stories of Ludwig von Mises, F.A. Hayek, Ayn Rand, Murray Rothbard, and Milton Friedman, and their personal battles, character flaws, love affairs, and historical events that altered its course. In so doing, he provides a fascinating new perspective on American history, from the New Deal through the culture wars of the 1060s to today’s divisiveness.
In February, the Wall Street Journal noted, “With ‘Radicals for Capitalism’, Brian Doherty finally gives libertarianism its due…Mr. Doherty has rescued libertarianism from its own obscurity, eloquently capturing the appeal of the ‘pure idea’, its origins in great minds and the feistiness of its many current champions.” – Cody’s Books
Brian Doherty is a senior editor of Reason, the libertarian monthly named one of “The 50 Best Magazines” three out of the past four years by the Chicago Tribune. Established in 1968 and a four-time finalist for National Magazine Awards, Reason has a print circulation of 40,000 and won the 2005 Western Publications Association “MAGGIE” Award for best political magazine.
Brian Doherty on The Forgotten History of the Antiwar Right
What Happened to the Antiwar Movement?
Gun Rights on Trial: Brian Doherty Reacts to D.C. v. Heller
Gun Rights Under Obama – Brian Doherty
Brian Doherty on Ron Paul’s Revolution
Ron Paul Supporters Seek to Assert Presence at RNC and Influence Long Term Direction of GOP
Brian Doherty Discusses ‘Ron Paul’s Revolution’
Brian Doherty’s Favorite Obscure Libertarian: Thomas Szasz
Background Articles and Videos
Libertarianism From A to Z With Jeffrey Miron
What happened to the “libertarian moment”?
With Ron Paul retiring, who will pick up the mantle of the libertarian movement?
The Libertarian View: Liberty and the Path of History
Exploring Liberty: The History of Liberty, Pt. 1 (Tom G. Palmer)
The Morality of Capitalism | Tom G. Palmer
Tom G. Palmer gives a speech based on his new book, “The Morality of Capitalism.” Presented at the John Locke Foundation on October 17, 2011.
Thomas Szasz on Socialism in Health Care
The health care debate is fundamentally broken, argues the great psychiatry skeptic Thomas Szasz, because it assumes a flawed premise. Namely, that “diseases require treatment, so the thing to do is to avoid diseases so you don’t need treatment.”
Szasz ties this to the problem of socialism in health care. Because of the way we think about disease, we have a health care system that removes control from individuals and gives it to state-enabled doctors and insurance companies. In psychology, for example, “diseases are no longer defined by pathologists but are defined essentially by a political process.”
This has lead to, among other things, more expensive health care. Szasz offers seven reasons why, many having to do with the way we think about disease, how it should be treated, and the relationship between citizens and medicine.
Segment 4: No Such Agency — NSA — National Security Agency — Threat To The Liberty and Privacy of The American People — None Of Their Damn Business — Still Trust The Federal Government? — Videos
“Those who would give up essential liberty to purchase a little temporary safety deserve neither liberty nor safety.”
~ Benjamin Franklin, Historical Review of Pennsylvania, 1759
National Security Agency
Obama the Hypocrite on NSA, FISA, Patriot Act
Pres. Obama’s response to the 2013 NSA PRISM spying scandal
Do Politicians All Agree Wiretapping Is In the Peoples Interest?
Glenn Becks “SURVEILLANCE STATE” (Must Viewing)
Glenn Greenwald Details ‘Menacing’ Reach Of NSA’s Invasion Of Google, Facebook, Apple Servers
6/6/13 Krauthammer on the NSA-Verizon scandal
NSA tracking Verizon phone calls
Reporter who broke the story tells CNN’s Jake Tapper the government is engaged in ‘unthinkable types of surveillance.’
A Massive Surveillance State: Glenn Greenwald Exposes Massive NSA Program Collecting Calls, Emails
Judge Napolitano On NSA Spying: Most Extraordinarily Broad Search Warrant Ever Issued In US History
US admits monitoring internet firms’ servers [1]
US admits monitoring internet firms’ servers [2]
NSA Admits Tapping Google And Facebook Servers
Ted Cruz Fires At Obama Administration ‘They View Constitution As A Pesky Obstruction’
NSA Spying on All Americans Part 1
NSA spying on All Americans Part 2
Dershowitz: Don’t overreact to NSA acts
NSA Secretly Collected Millions of Phone Records
he National Security Agency has secretly collected data about millions of domestic and international calls by Verizon customers. Jeffrey Brown gets debate on the privacy and civil liberty concerns from Kate Martin of the Center for National Security Studies and former NSA official Col. Cedric Leighton.
NSA Whistleblowers: “All U.S. Citizens” Targeted By Surveillance Program, Not Just Verizon Customers
Chocking Revelation!!! – Chaos In The Federal Government – NSA, Can You Hear Me Now? – O’Reilly
Government Data Mining: Impossible to Escape?
Big Brother & Your Money – Obama Admin Plans To Give Full Access To Intel, To American’s Finance
NSA Secretly Storing Verizon Calls: Report – White House Calls Program ‘Critcal’
Complete News – NSA Collects Phone Records on Millions
NSA Spying: Sweeping US data-mining program revealed
NSA Spying On Americans Verizon – Obama House Scandals- Newt Gingrich – Hannity
Shep Smith And Judge Napolitano Rail Against NSA Abuse: ‘We’re Not Letting This Go.’
Obama Orders Verizon to Spy on Americans
BREAKING! Obama’s NSA Collecting Phone Records Of Millions Of Americans Daily
“The NSA Is Lying”: U.S. Government Has Copies of Most of Your Emails Says NSA Whistleblower
Inside NSA – The National Security Agency – Documentary
James Bamford: Inside the NSA’s Largest Secret Domestic Spy Center
Whistle Blower Threatened with 35 Years in Prison, Warns of Developing Tyranny
NSA Whistleblower Thomas Drake speaks at National Press Club – March 15, 2013
Jon Stewart Tears Apart Obama, DOJ For Prosecuting Whistleblowers And Potheads But Not Bankers
National Security Agency Whistleblower William Binney on Growing State Surveillance
NSA whistleblower William Binney Keynote at HOPE Number Nine
NSA whistleblower exposes Obama’s secrets
NSA Whistleblower Thomas Drake Prevails in Unprecedented Obama Admin Crackdown
Obama’s NSA: Close to Knowing All About Us
What You Should Know About The New NSA Utah Data Center
The Utah Data Center
NSA Building Colossal New Data Center: Spying on Americans
NSA Utah Data Spy Center Revealed
DEA pushes for warrantless access to your medical records.
Glenn Greenwald on the High Cost of Government Secrecy
Glenn Greenwald on Domestic Surveillance: NSA Warrantless Wiretapping Controversy (2006)
Glenn Greenwald (born March 6, 1967) is an American political journalist, lawyer, columnist, blogger, and author. In August 2012, he left Salon.com, where he was a columnist, to become a columnist at the US edition of The Guardian newspaper, to which he has contributed since June 2011. Politically, Greenwald described himself as independent when he first began writing about politics in 2005,[6] though others now see him as a liberal or progressive.
Greenwald worked as a constitutional and civil rights litigator before becoming a contributor (columnist and blogger) to Salon.com, where he focused on political and legal topics.[12] He has also contributed to other newspapers and political news magazines, including The New York Times,[13][14][15] the Los Angeles Times,[16] The American Conservative,[17] The National Interest,[18] and In These Times.[19][20]
Greenwald has written four books, three of which have been New York Times bestsellers: How Would a Patriot Act? (2006); A Tragic Legacy (2007), and With Liberty and Justice for Some: How the Law Is Used to Destroy Equality and Protect the Powerful, released in October 2011. He also wrote Great American Hypocrites (2008).
Greenwald has received awards including the first Izzy Award for independent journalism, in 2009,[21] and the 2010 Online Journalism Award for Best Commentary.[22] Greenwald is a frequent speaker on college campuses, including Harvard Law School, Yale Law School, the University of Pennsylvania, Brown University, UCLA School of Law, the University of Wisconsin, the University of Maryland and others. He also appears on various radio and television programs as a guest political pundit.
Challenging the Surveillance State – Glenn Greenwald
122712 – Sen. Rand Paul Discusses FISA Amendment
Rand Paul: ‘Appalled’ At NSA’s Violation Of The Bill Of Rights – Yahoo News 6/6/2013
NSA taps in to internet giants’ systems to mine user data, secret files reveal
• Top secret PRISM program claims direct access to servers of firms including Google, Facebook and Apple
• Companies deny any knowledge of program in operation since 2007
Glenn Greenwald and Ewen MacAskill
The National Security Agency has obtained direct access to the systems of Google, Facebook, Apple and other US internet giants, according to a top secret document obtained by the Guardian.
The NSA access is part of a previously undisclosed program called PRISM, which allows officials to collect material including search history, the content of emails, file transfers and live chats, the document says.
The Guardian has verified the authenticity of the document, a 41-slide PowerPoint presentation – classified as top secret with no distribution to foreign allies – which was apparently used to train intelligence operatives on the capabilities of the program. The document claims “collection directly from the servers” of major US service providers.
Although the presentation claims the program is run with the assistance of the companies, all those who responded to a Guardian request for comment on Thursday denied knowledge of any such program.
In a statement, Google said: “Google cares deeply about the security of our users’ data. We disclose user data to government in accordance with the law, and we review all such requests carefully. From time to time, people allege that we have created a government ‘back door’ into our systems, but Google does not have a back door for the government to access private user data.”
Several senior tech executives insisted that they had no knowledge of PRISM or of any similar scheme. They said they would never have been involved in such a program. “If they are doing this, they are doing it without our knowledge,” one said.
An Apple spokesman said it had “never heard” of PRISM.
The NSA access was enabled by changes to US surveillance law introduced under President Bush and renewed under Obama in December 2012.
The program facilitates extensive, in-depth surveillance on live communications and stored information. The law allows for the targeting of any customers of participating firms who live outside the US, or those Americans whose communications include people outside the US.
It also opens the possibility of communications made entirely within the US being collected without warrants.
Disclosure of the PRISM program follows a leak to the Guardian on Wednesday of a top-secret court order compelling telecoms provider Verizon to turn over the telephone records of millions of US customers.
The participation of the internet companies in PRISM will add to the debate, ignited by the Verizon revelation, about the scale of surveillance by the intelligence services. Unlike the collection of those call records, this surveillance can include the content of communications and not just the metadata.
Some of the world’s largest internet brands are claimed to be part of the information-sharing program since its introduction in 2007. Microsoft – which is currently running an advertising campaign with the slogan “Your privacy is our priority” – was the first, with collection beginning in December 2007.
It was followed by Yahoo in 2008; Google, Facebook and PalTalk in 2009; YouTube in 2010; Skype and AOL in 2011; and finally Apple, which joined the program in 2012. The program is continuing to expand, with other providers due to come online.
Collectively, the companies cover the vast majority of online email, search, video and communications networks.
The extent and nature of the data collected from each company varies.
Companies are legally obliged to comply with requests for users’ communications under US law, but the PRISM program allows the intelligence services direct access to the companies’ servers. The NSA document notes the operations have “assistance of communications providers in the US”.
The revelation also supports concerns raised by several US senators during the renewal of the Fisa Amendments Act in December 2012, who warned about the scale of surveillance the law might enable, and shortcomings in the safeguards it introduces.
When the FAA was first enacted, defenders of the statute argued that a significant check on abuse would be the NSA’s inability to obtain electronic communications without the consent of the telecom and internet companies that control the data. But the PRISM program renders that consent unnecessary, as it allows the agency to directly and unilaterally seize the communications off the companies’ servers.
A chart prepared by the NSA, contained within the top-secret document obtained by the Guardian, underscores the breadth of the data it is able to obtain: email, video and voice chat, videos, photos, voice-over-IP (Skype, for example) chats, file transfers, social networking details, and more.
The document is recent, dating to April 2013. Such a leak is extremely rare in the history of the NSA, which prides itself on maintaining a high level of secrecy.
The PRISM program allows the NSA, the world’s largest surveillance organisation, to obtain targeted communications without having to request them from the service providers and without having to obtain individual court orders.
With this program, the NSA is able to reach directly into the servers of the participating companies and obtain both stored communications as well as perform real-time collection on targeted users.
The presentation claims PRISM was introduced to overcome what the NSA regarded as shortcomings of Fisa warrants in tracking suspected foreign terrorists. It noted that the US has a “home-field advantage” due to housing much of the internet’s architecture. But the presentation claimed “Fisa constraints restricted our home-field advantage” because Fisa required individual warrants and confirmations that both the sender and receiver of a communication were outside the US.
“Fisa was broken because it provided privacy protections to people who were not entitled to them,” the presentation claimed. “It took a Fisa court order to collect on foreigners overseas who were communicating with other foreigners overseas simply because the government was collecting off a wire in the United States. There were too many email accounts to be practical to seek Fisas for all.”
The new measures introduced in the FAA redefines “electronic surveillance” to exclude anyone “reasonably believed” to be outside the USA – a technical change which reduces the bar to initiating surveillance.
The act also gives the director of national intelligence and the attorney general power to permit obtaining intelligence information, and indemnifies internet companies against any actions arising as a result of co-operating with authorities’ requests.
In short, where previously the NSA needed individual authorisations, and confirmation that all parties were outside the USA, they now need only reasonable suspicion that one of the parties was outside the country at the time of the records were collected by the NSA.
The document also shows the FBI acts as an intermediary between other agencies and the tech companies, and stresses its reliance on the participation of US internet firms, claiming “access is 100% dependent on ISP provisioning”.
In the document, the NSA hails the PRISM program as “one of the most valuable, unique and productive accesses for NSA”.
It boasts of what it calls “strong growth” in its use of the PRISM program to obtain communications. The document highlights the number of obtained communications increased in 2012 by 248% for Skype – leading the notes to remark there was “exponential growth in Skype reporting; looks like the word is getting out about our capability against Skype”. There was also a 131% increase in requests for Facebook data, and 63% for Google.
The NSA document indicates that it is planning to add Dropbox as a PRISM provider. The agency also seeks, in its words, to “expand collection services from existing providers”.
The revelations echo fears raised on the Senate floor last year during the expedited debate on the renewal of the FAA powers which underpin the PRISM program, which occurred just days before the act expired.
Senator Christopher Coons of Delaware specifically warned that the secrecy surrounding the various surveillance programs meant there was no way to know if safeguards within the act were working.
“The problem is: we here in the Senate and the citizens we represent don’t know how well any of these safeguards actually work,” he said.
“The law doesn’t forbid purely domestic information from being collected. We know that at least one Fisa court has ruled that the surveillance program violated the law. Why? Those who know can’t say and average Americans can’t know.”
Other senators also raised concerns. Senator Ron Wyden of Oregon attempted, without success, to find out any information on how many phone calls or emails had been intercepted under the program.
When the law was enacted, defenders of the FAA argued that a significant check on abuse would be the NSA’s inability to obtain electronic communications without the consent of the telecom and internet companies that control the data. But the PRISM program renders that consent unnecessary, as it allows the agency to directly and unilaterally seize the communications off the companies’ servers.
When the NSA reviews a communication it believes merits further investigation, it issues what it calls a “report”. According to the NSA, “over 2,000 PRISM-based reports” are now issued every month. There were 24,005 in 2012, a 27% increase on the previous year.
In total, more than 77,000 intelligence reports have cited the PRISM program.
Jameel Jaffer, director of the ACLU’s Center for Democracy, that it was astonishing the NSA would even ask technology companies to grant direct access to user data.
“It’s shocking enough just that the NSA is asking companies to do this,” he said. “The NSA is part of the military. The military has been granted unprecedented access to civilian communications.
“This is unprecedented militarisation of domestic communications infrastructure. That’s profoundly troubling to anyone who is concerned about that separation.”
A senior administration official said in a statement: “The Guardian and Washington Post articles refer to collection of communications pursuant to Section 702 of the Foreign Intelligence Surveillance Act. This law does not allow the targeting of any US citizen or of any person located within the United States.
“The program is subject to oversight by the Foreign Intelligence Surveillance Court, the Executive Branch, and Congress. It involves extensive procedures, specifically approved by the court, to ensure that only non-US persons outside the US are targeted, and that minimize the acquisition, retention and dissemination of incidentally acquired information about US persons.
“This program was recently reauthorized by Congress after extensive hearings and debate.
“Information collected under this program is among the most important and valuable intelligence information we collect, and is used to protect our nation from a wide variety of threats.
“The Government may only use Section 702 to acquire foreign intelligence information, which is specifically, and narrowly, defined in the Foreign Intelligence Surveillance Act. This requirement applies across the board, regardless of the nationality of the target.”
Additional reporting by James Ball and Dominic Rushe
NSA collecting phone records of millions of Verizon customers daily
Glenn Greenwald
Exclusive: Top secret court order requiring Verizon to hand over all call data shows scale of domestic surveillance under Obama
The National Security Agency is currently collecting the telephone records of millions of US customers of Verizon, one of America’s largest telecoms providers, under a top secret court order issued in April.
The document shows for the first time that under the Obama administration the communication records of millions of US citizens are being collected indiscriminately and in bulk – regardless of whether they are suspected of any wrongdoing.
The secret Foreign Intelligence Surveillance Court (Fisa) granted the order to the FBI on April 25, giving the government unlimited authority to obtain the data for a specified three-month period ending on July 19.
Under the terms of the blanket order, the numbers of both parties on a call are handed over, as is location data, call duration, unique identifiers, and the time and duration of all calls. The contents of the conversation itself are not covered.
The disclosure is likely to reignite longstanding debates in the US over the proper extent of the government’s domestic spying powers.
Under the Bush administration, officials in security agencies had disclosed to reporters the large-scale collection of call records data by the NSA, but this is the first time significant and top-secret documents have revealed the continuation of the practice on a massive scale under President Obama.
The unlimited nature of the records being handed over to the NSA is extremely unusual. Fisa court orders typically direct the production of records pertaining to a specific named target who is suspected of being an agent of a terrorist group or foreign state, or a finite set of individually named targets.
The Guardian approached the National Security Agency, the White House and the Department of Justice for comment in advance of publication on Wednesday. All declined. The agencies were also offered the opportunity to raise specific security concerns regarding the publication of the court order.
The court order expressly bars Verizon from disclosing to the public either the existence of the FBI’s request for its customers’ records, or the court order itself.
“We decline comment,” said Ed McFadden, a Washington-based Verizon spokesman.
The order, signed by Judge Roger Vinson, compels Verizon to produce to the NSA electronic copies of “all call detail records or ‘telephony metadata’ created by Verizon for communications between the United States and abroad” or “wholly within the United States, including local telephone calls”.
The order directs Verizon to “continue production on an ongoing daily basis thereafter for the duration of this order”. It specifies that the records to be produced include “session identifying information”, such as “originating and terminating number”, the duration of each call, telephone calling card numbers, trunk identifiers, International Mobile Subscriber Identity (IMSI) number, and “comprehensive communication routing information”.
The information is classed as “metadata”, or transactional information, rather than communications, and so does not require individual warrants to access. The document also specifies that such “metadata” is not limited to the aforementioned items. A 2005 court ruling judged that cell site location data – the nearest cell tower a phone was connected to – was also transactional data, and so could potentially fall under the scope of the order.
While the order itself does not include either the contents of messages or the personal information of the subscriber of any particular cell number, its collection would allow the NSA to build easily a comprehensive picture of who any individual contacted, how and when, and possibly from where, retrospectively.
It is not known whether Verizon is the only cell-phone provider to be targeted with such an order, although previous reporting has suggested the NSA has collected cell records from all major mobile networks. It is also unclear from the leaked document whether the three-month order was a one-off, or the latest in a series of similar orders.
The court order appears to explain the numerous cryptic public warnings by two US senators, Ron Wyden and Mark Udall, about the scope of the Obama administration’s surveillance activities.
For roughly two years, the two Democrats have been stridently advising the public that the US government is relying on “secret legal interpretations” to claim surveillance powers so broad that the American public would be “stunned” to learn of the kind of domestic spying being conducted.
Because those activities are classified, the senators, both members of the Senate intelligence committee, have been prevented from specifying which domestic surveillance programs they find so alarming. But the information they have been able to disclose in their public warnings perfectly tracks both the specific law cited by the April 25 court order as well as the vast scope of record-gathering it authorized.
Julian Sanchez, a surveillance expert with the Cato Institute, explained: “We’ve certainly seen the government increasingly strain the bounds of ‘relevance’ to collect large numbers of records at once — everyone at one or two degrees of separation from a target — but vacuuming all metadata up indiscriminately would be an extraordinary repudiation of any pretence of constraint or particularized suspicion.” The April order requested by the FBI and NSA does precisely that.
The law on which the order explicitly relies is the so-called “business records” provision of the Patriot Act, 50 USC section 1861. That is the provision which Wyden and Udall have repeatedly cited when warning the public of what they believe is the Obama administration’s extreme interpretation of the law to engage in excessive domestic surveillance.
In a letter to attorney general Eric Holder last year, they argued that “there is now a significant gap between what most Americans think the law allows and what the government secretly claims the law allows.”
“We believe,” they wrote, “that most Americans would be stunned to learn the details of how these secret court opinions have interpreted” the “business records” provision of the Patriot Act.
Privacy advocates have long warned that allowing the government to collect and store unlimited “metadata” is a highly invasive form of surveillance of citizens’ communications activities. Those records enable the government to know the identity of every person with whom an individual communicates electronically, how long they spoke, and their location at the time of the communication.
Such metadata is what the US government has long attempted to obtain in order to discover an individual’s network of associations and communication patterns. The request for the bulk collection of all Verizon domestic telephone records indicates that the agency is continuing some version of the data-mining program begun by the Bush administration in the immediate aftermath of the 9/11 attack.
The NSA, as part of a program secretly authorized by President Bush on 4 October 2001, implemented a bulk collection program of domestic telephone, internet and email records. A furore erupted in 2006 when USA Today reported that the NSA had “been secretly collecting the phone call records of tens of millions of Americans, using data provided by AT&T, Verizon and BellSouth” and was “using the data to analyze calling patterns in an effort to detect terrorist activity.” Until now, there has been no indication that the Obama administration implemented a similar program.
These recent events reflect how profoundly the NSA’s mission has transformed from an agency exclusively devoted to foreign intelligence gathering, into one that focuses increasingly on domestic communications. A 30-year employee of the NSA, William Binney, resigned from the agency shortly after 9/11 in protest at the agency’s focus on domestic activities.
In the mid-1970s, Congress, for the first time, investigated the surveillance activities of the US government. Back then, the mandate of the NSA was that it would never direct its surveillance apparatus domestically.
At the conclusion of that investigation, Frank Church, the Democratic senator from Idaho who chaired the investigative committee, warned: “The NSA’s capability at any time could be turned around on the American people, and no American would have any privacy left, such is the capability to monitor everything: telephone conversations, telegrams, it doesn’t matter.”
Additional reporting by Ewen MacAskill and Spencer Ackerman
Verizon forced to hand over telephone data – full court ruling
The US government is collecting the phone records of millions of US customers of Verizon under a top secret court order. Read the Foreign Intelligence Surveillance Court order
DNI Statement on Recent Unauthorized Disclosures of Classified Information
Thursday, June 06, 2013
June 6, 2013
DNI Statement on Recent Unauthorized Disclosures of Classified Information
The highest priority of the Intelligence Community is to work within the constraints of law to collect, analyze and understand information related to potential threats to our national security.
The unauthorized disclosure of a top secret U.S. court document threatens potentially long-lasting and irreversible harm to our ability to identify and respond to the many threats facing our nation.
The article omits key information regarding how a classified intelligence collection program is used to prevent terrorist attacks and the numerous safeguards that protect privacy and civil liberties.
I believe it is important for the American people to understand the limits of this targeted counterterrorism program and the principles that govern its use. In order to provide a more thorough understanding of the program, I have directed that certain information related to the “business records” provision of the Foreign Intelligence Surveillance Act be declassified and immediately released to the public.
The following important facts explain the purpose and limitations of the program:
The judicial order that was disclosed in the press is used to support a sensitive intelligence collection operation, on which members of Congress have been fully and repeatedly briefed. The classified program has been authorized by all three branches of the Government.
Although this program has been properly classified, the leak of one order, without any context, has created a misleading impression of how it operates. Accordingly, we have determined to declassify certain limited information about this program.
The program does not allow the Government to listen in on anyone’s phone calls. The information acquired does not include the content of any communications or the identity of any subscriber. The only type of information acquired under the Court’s order is telephony metadata, such as telephone numbers dialed and length of calls.
The collection is broad in scope because more narrow collection would limit our ability to screen for and identify terrorism-related communications. Acquiring this information allows us to make connections related to terrorist activities over time. The FISA Court specifically approved this method of collection as lawful, subject to stringent restrictions.
The information acquired has been part of an overall strategy to protect the nation from terrorist threats to the United States, as it may assist counterterrorism personnel to discover whether known or suspected terrorists have been in contact with other persons who may be engaged in terrorist activities.
There is a robust legal regime in place governing all activities conducted pursuant to the Foreign Intelligence Surveillance Act, which ensures that those activities comply with the Constitution and laws and appropriately protect privacy and civil liberties. The program at issue here is conducted under authority granted by Congress and is authorized by the Foreign Intelligence Surveillance Court (FISC). By statute, the Court is empowered to determine the legality of the program.
By order of the FISC, the Government is prohibited from indiscriminately sifting through the telephony metadata acquired under the program. All information that is acquired under this program is subject to strict, court-imposed restrictions on review and handling. The court only allows the data to be queried when there is a reasonable suspicion, based on specific facts, that the particular basis for the query is associated with a foreign terrorist organization. Only specially cleared counterterrorism personnel specifically trained in the Court-approved procedures may even access the records.
All information that is acquired under this order is subject to strict restrictions on handling and is overseen by the Department of Justice and the FISA Court. Only a very small fraction of the records are ever reviewed because the vast majority of the data is not responsive to any terrorism-related query.
The Court reviews the program approximately every 90 days. DOJ conducts rigorous oversight of the handling of the data received to ensure the applicable restrictions are followed. In addition, DOJ and ODNI regularly review the program implementation to ensure it continues to comply with the law.
The Patriot Act was signed into law in October 2001 and included authority to compel production of business records and other tangible things relevant to an authorized national security investigation with the approval of the FISC. This provision has subsequently been reauthorized over the course of two Administrations – in 2006 and in 2011. It has been an important investigative tool that has been used over the course of two Administrations, with the authorization and oversight of the FISC and the Congress.
Discussing programs like this publicly will have an impact on the behavior of our adversaries and make it more difficult for us to understand their intentions. Surveillance programs like this one are consistently subject to safeguards that are designed to strike the appropriate balance between national security interests and civil liberties and privacy concerns. I believe it is important to address the misleading impression left by the article and to reassure the American people that the Intelligence Community is committed to respecting the civil liberties and privacy of all American citizens.
James R. Clapper, Director of National Intelligence
US intelligence chief denounces release of information
Spencer Ackerman
Revealing huge surveillance programme risks damaging US national security, James Clapper says
Disclosure of the massive surveillance of phone records and internet communications risks “long-lasting and irreversible harm” to US national security, the director of national intelligence says.
Late on Thursday night US time James Clapper issued a bullet-point defence of the surveillance programs disclosed by the Guardian and the Washington Post, saying they contained “numerous safeguards that protect privacy and civil liberties”. To correct the “misleading impression left in the article” – apparently a reference to the Guardian’s original story – Clapper said he approved the declassification of his defence of the National Security Agency’s collection of every phone record from millions of Verizon customers.
“There is a robust legal regime in place governing all activities conducted pursuant to the Foreign Intelligence Surveillance Act,” Clapper wrote, “which ensures that those activities comply with the Constitution and laws and appropriately protect privacy and civil liberties. The program at issue here is conducted under authority granted by Congress and is authorized by the Foreign Intelligence Surveillance Court (FISC). By statute, the Court is empowered to determine the legality of the program.”
Clapper attacked the disclosures by the Guardian and the Washington Post as “reprehensible” for risking “important protections for the security of Americans”.
A judge for Fisa Court, as the surveillance body is known, reviewed and approved the surveillance. But critics have pointed out that the Fisa Court has almost never, in its 35-year history, rejected a US surveillance request – a perception of docility that prompted its presiding judge, Reggie Walton, to defend the court’s integrity in a statement to the Guardian on Thursday.
Clapper said the Fisa Court had established procedures preventing the government “indiscriminately sifting” through the collected phone records. “The court only allows the data to be queried when there is a reasonable suspicion, based on specific facts, that the particular basis for the query is associated with a foreign terrorist organisation,” Clapper said. “Only a small fraction of the records are ever reviewed” by “specifically cleared counterterrorism personnel”.
At the same time, Clapper said national security required the NSA to collect all the Verizon subscriber data, even if not all the data would be analysed, and regardless of any evidence to link the phone records to crime, foreign espionage or terrorism. On Thursday, the Wall Street Journal reported that other telecoms received similar orders from the government for the subscriber data.
“The collection is broad in scope,” Clapper wrote, “because more narrow collection would limit our ability to protect the nation from terrorist threats to the United States, as it may assist counterterrorism personnel to discover whether known or suspected terrorists have been in contact with other persons who may be engaged in terrorist activities.”
Yet the collection does not need to be tied to terrorism to occur – something that alarmed one Democrat senator, Jeff Merkley. He told the Guardian on Thursday that the sweeping “barn-door” collection appeared to violate the provision of the Patriot Act purportedly authorising it.
“We can’t really propose changes to the law unless we know what the words mean as interpreted by the court,” Merkley said.
Clapper reiterated a point the Obama administration made on Thursday in its response to the Guardian’s story: the NSA’s dragnet of Verizon phone records, which the Fisa Court authorised until 19 July, does not include the “content of any communications or the identity of any subscriber”. Yet the so-called “metadata” – phone numbers, duration of calls – can be combined with publicly available information to easily determine subscriber identity. And a second NSA surveillance effort, disclosed by the Guardian on Thursday and codenamed PRISM, collects the content of communications provided through Google, Facebook, Microsoft, Apple and five other large internet companies.
Clapper came under criticism on Thursday for statements to Democrat senator Ron Wyden that appeared to be contradicted by the revelations of the surveillance programs. Asked in March whether “millions” of Americans had “any kind of [their] data” collected by the US government, Clapper replied: “Not wittingly. There are cases where they could inadvertently perhaps collect, but not wittingly.”
He has denied misleading Congress, but Clapper’s statement on Thursday suggested the collection of Americans’ phone records was deliberate, methodical and institutionalised.
“Discussing programs like this publicly,” Clapper concluded, “will have an impact on the behavior of our adversaries and make it more difficult for us to understand their intentions.”
Within hours of the disclosure that federal authorities routinely collect data on phone calls Americans make, regardless of whether they have any bearing on a counterterrorism investigation, the Obama administration issued the same platitude it has offered every time President Obama has been caught overreaching in the use of his powers: Terrorists are a real menace and you should just trust us to deal with them because we have internal mechanisms (that we are not going to tell you about) to make sure we do not violate your rights.
Those reassurances have never been persuasive — whether on secret warrants to scoop up a news agency’s phone records or secret orders to kill an American suspected of terrorism — especially coming from a president who once promised transparency and accountability.
The administration has now lost all credibility on this issue. Mr. Obama is proving the truism that the executive branch will use any power it is given and very likely abuse it. That is one reason we have long argued that the Patriot Act, enacted in the heat of fear after the Sept. 11, 2001, attacks by members of Congress who mostly had not even read it, was reckless in its assignment of unnecessary and overbroad surveillance powers.
Based on an article in The Guardian published Wednesday night, we now know that the Federal Bureau of Investigation and the National Security Agency used the Patriot Act to obtain a secret warrant to compel Verizon’s business services division to turn over data on every single call that went through its system. We know that this particular order was a routine extension of surveillance that has been going on for years, and it seems very likely that it extends beyond Verizon’s business division. There is every reason to believe the federal government has been collecting every bit of information about every American’s phone calls except the words actually exchanged in those calls.
Articles in The Washington Post and The Guardian described a process by which the N.S.A. is also able to capture Internet communications directly from the servers of nine leading American companies. The articles raised questions about whether the N.S.A. separated foreign communications from domestic ones.
A senior administration official quoted in The Times online Thursday afternoon about the Verizon order offered the lame observation that the information does not include the name of any caller, as though there would be the slightest difficulty in matching numbers to names. He said the information “has been a critical tool in protecting the nation from terrorist threats,” because it allows the government “to discover whether known or suspected terrorists have been in contact with other persons who may be engaged in terrorist activities, particularly people located inside the United States.”
That is a vital goal, but how is it served by collecting everyone’s call data? The government can easily collect phone records (including the actual content of those calls) on “known or suspected terrorists” without logging every call made. In fact, the Foreign Intelligence Surveillance Act was expanded in 2008 for that very purpose.
Essentially, the administration is saying that without any individual suspicion of wrongdoing, the government is allowed to know whom Americans are calling every time they make a phone call, for how long they talk and from where.
This sort of tracking can reveal a lot of personal and intimate information about an individual. To casually permit this surveillance — with the American public having no idea that the executive branch is now exercising this power — fundamentally shifts power between the individual and the state, and it repudiates constitutional principles governing search, seizure and privacy.
The defense of this practice offered by Senator Dianne Feinstein of California, who as chairwoman of the Senate Intelligence Committee is supposed to be preventing this sort of overreaching, was absurd. She said on Thursday that the authorities need this information in case someone might become a terrorist in the future. Senator Saxby Chambliss of Georgia, the vice chairman of the committee, said the surveillance has “proved meritorious, because we have gathered significant information on bad guys and only on bad guys over the years.”But what assurance do we have of that, especially since Ms. Feinstein went on to say that she actually did not know how the data being collected was used?
The senior administration official quoted in The Times said the executive branch internally reviews surveillance programs to ensure that they “comply with the Constitution and laws of the United States and appropriately protect privacy and civil liberties.”
That’s no longer good enough. Mr. Obama clearly had no intention of revealing this eavesdropping, just as he would not have acknowledged the killing of Anwar al-Awlaki, an American citizen, had it not been reported in the press. Even then, it took him more than a year and a half to acknowledge the killing, and he is still keeping secret the protocol by which he makes such decisions.
We are not questioning the legality under the Patriot Act of the court order disclosed by The Guardian. But we strongly object to using that power in this manner. It is the very sort of thing against which Mr. Obama once railed, when he said in 2007 that the surveillance policy of the George W. Bush administration “puts forward a false choice between the liberties we cherish and the security we provide.”
Two Democrats on the Senate Intelligence Committee, Ron Wyden of Oregon and Mark Udall of Colorado, have raised warnings about the government’s overbroad interpretation of its surveillance powers. “We believe most Americans would be stunned to learn the details of how these secret court opinions have interpreted Section 215 of the Patriot Act,” they wrote last year in a letter to Attorney General Eric Holder Jr. “As we see it, there is now a significant gap between what most Americans think the law allows and what the government secretly claims the law allows. This is a problem, because it is impossible to have an informed public debate about what the law should say when the public doesn’t know what its government thinks the law says.”
On Thursday, Representative Jim Sensenbrenner, Republican of Wisconsin, who introduced the Patriot Act in 2001, said that the National Security Agency overstepped its bounds by obtaining a secret order to collect phone log records from millions of Americans.
“As the author of the Patriot Act, I am extremely troubled by the F.B.I.’s interpretation of this legislation,” he said in a statement. “While I believe the Patriot Act appropriately balanced national security concerns and civil rights, I have always worried about potential abuses.” He added: “Seizing phone records of millions of innocent people is excessive and un-American.”
Stunning use of the act shows, once again, why it needs to be sharply curtailed if not repealed.
To find the legal authority underpinning the top-secret Prism surveillance program, we once again turn to the Foreign Intelligence Surveillance Act.
Law Blog on Thursday wrote about the statute allowing the government to compel the production of “business records” relevant to a foreign intelligence probe.
Another statute, Section 702 of FISA, provides procedures for spying on the online communication of foreigners or groups located outside our borders.
In a statement Thursday, Director of National Intelligence James R. Clapper said Section 702 “cannot be used to intentionally target any U.S. citizen, any other U.S. person, or anyone located within the United States.”
But the statute passed by Congress in 2008 leaves quite a bit of wiggle room, according to legal experts. Here are some potential loopholes:
‘Reasonably believed’: The Attorney General and the intelligence director must certify to a special surveillance judge that targets are “reasonably believed to be located outside the United States.” How certain is that? According to the Washington Post, that means a 51% confidence, similar to the preponderance of evidence standard.
“Given the scale of collection here, even if [the error rate] were only a few percent, we’d still be talking about a huge number of American communications,” Julian Sanchez, a research fellow at the Cato Institute, told Law Blog.
Also, the government doesn’t have to be 51% sure that the target isn’t an American citizen nor a legal resident. The government just has to assert that it’s not intentionally targeting a citizen or legal resident.
Who’s the target? There’s another ambiguity around the notion of a target. It’s unclear whether NSA interprets the law to allow the government to tap into accounts belonging to Americans as long as the surveillance is broadly directed at a foreign group, like Al Qaeda, according to Mr. Sanchez.
Optional verifying: The targeting procedures are subject to judicial review by the Foreign Intelligence Surveillance Court, but “the court is not required to look behind the assertions made in the certifications” submitted by the attorney and the national intelligence director, according to an analysis of the law prepared by the Congressional Research Service, a nonpartisan and independent group that advises Congress on legal matters.
Exigent circumstances: In the absence of a court order, the attorney general and intelligence director may also authorize targeting if they determine that “exigent circumstances exist which would cause the loss or delay of important national security intelligence, according to the Congressional Research Service. The government has seven days to submit the “certification” paperwork to the court, but it can move forward with the spying during that week.
“They’re assuring us that there are secret procedures in place to protect privacy, but there’s never been a public evaluation of them,” Michelle Richardson, legislative counsel for the American Civil Liberties Union’s Washington Legislative Office, told Law Blog. “We’re disinclined to take their word for it knowing that they are doing things like collecting everybody’s telephone records.”
Mr. Clapper in his statement said that information collected under Prism “is among the most important and valuable foreign intelligence information we collect, and is used to protect our nation from a wide variety of threats.”
Mr. Clapper also said in his statement that “activities authorized” by the law “involve extensive procedures . . . to ensure that only non-U.S. persons outside the U.S. are targeted . . . ”
A spokesperson for Mr. Clapper’s office did not immediately respond to a request seeking comment.
The Foreign Intelligence Surveillance Act of 1978 (“FISA” Pub.L. 95–511, 92 Stat. 1783, 50 U.S.C.ch. 36) is a United States law which prescribes procedures for the physical and electronic surveillance and collection of “foreign intelligence information” between “foreign powers” and “agents of foreign powers” (which may include American citizens and permanent residents suspected of espionage or terrorism).[1] The law does not apply outside the United States. The law has been repeatedly amended since the September 11 attacks.
Subsequent amendments
The Act was amended in 2001 by the USA PATRIOT Act, primarily to include terrorism on behalf of groups that are not specifically backed by a foreign government.
An overhaul of the bill, the Protect America Act of 2007 was signed into law on August 5, 2007.[2] It expired on February 17, 2008.
The FISA resulted from extensive investigations by Senate Committees into the legality of domestic intelligence activities. These investigations were led separately by Sam Ervin and Frank Church in 1978 as a response to President Richard Nixon’s usage of federal resources to spy on political and activist groups, which violates the Fourth Amendment.[4] The act was created to provide Judicial and congressional oversight of the government’s covert surveillance activities of foreign entities and individuals in the United States, while maintaining the secrecy needed to protect national security. It allowed surveillance, without court order, within the United States for up to one year unless the “surveillance will acquire the contents of any communication to which a United States person is a party”. If a United States person is involved, judicial authorization was required within 72 hours after surveillance begins.
Bush administration warrantless domestic wiretapping program
The Act came into public prominence in December 2005 following publication by the New York Times of an article[5] that described a program of warrantless domestic wiretapping ordered by the Bush administration and carried out by the National Security Agency since 2002; a subsequent Bloomberg article[6] suggested that this may have already begun by June 2000.
Scope and limits
For most purposes, including electronic surveillance and physical searches, “foreign powers” means a foreign government, any faction(s) or foreign governments not substantially composed of U.S. persons, and any entity directed or controlled by a foreign government. §§1801(a)(1)-(3) The definition also includes groups engaged in international terrorism and foreign political organizations. §§1801(a)(4) and (5). The sections of FISA authorizing electronic surveillance and physical searches without a court order specifically exclude their application to groups engaged in international terrorism. See §1802(a)(1) (referring specifically to §1801(a)(1), (2), and (3)).
The statute includes limits on how it may be applied to U.S. persons. A “U.S. person” includes citizens, lawfully admitted permanent resident aliens, and corporations incorporated in the United States.
The code defines “foreign intelligence information” to mean information necessary to protect the United States against actual or potential grave attack, sabotage or international terrorism.[7]
In sum, a significant purpose of the electronic surveillance must be to obtain intelligence in the United States on foreign powers (such as enemy agents or spies) or individuals connected to international terrorist groups. To use FISA, the government must show probable cause that the “target of the surveillance is a foreign power or agent of a foreign power.”[4][8]
The act created a court which meets in secret, and approves or denies requests for search warrants. Only the number of warrants applied for, issued and denied, is reported. In 1980 (the first full year after its inception), it approved 322 warrants.[9] This number has steadily grown to 2,224 warrants in 2006.[10] In the period 1979-2006 a total of 22,990 applications for warrants were made to the Court of which 22,985 were approved (sometimes with modifications; or with the splitting up, or combining together, of warrants for legal purposes), and only 5 were definitively rejected.[11]
Electronic surveillance
Generally, the statute permits electronic surveillance in two scenarios.
Without a court order
The President may authorize, through the Attorney General, electronic surveillance without a court order for the period of one year provided it is only for foreign intelligence information;[7] targeting foreign powers as defined by 50 U.S.C.§ 1801(a)(1),(2),(3)[12] or their agents; and there is no substantial likelihood that the surveillance will acquire the contents of any communication to which a United States person is a party.[13]
Since 50 U.S.C.§ 1802(a)(1)(A) of this act specifically limits warrantless surveillance to foreign powers as defined by 50 U.S.C. §1801(a) (1),(2), (3) and omits the definitions contained in 50 U.S.C. §1801(a) (4),(5),(6) the act does not authorize the use of warrantless surveillance on: groups engaged in international terrorism or activities in preparation therefore; foreign-based political organizations, not substantially composed of United States persons; or entities that are directed and controlled by a foreign government or governments.[16] Under the FISA act, anyone who engages in electronic surveillance except as authorized by statute is subject to both criminal penalties[17] and civil liabilities.[18]
Under 50 U.S.C. § 1811, the President may also authorize warrantless surveillance at the beginning of a war. Specifically, he may authorize such surveillance “for a period not to exceed fifteen calendar days following a declaration of war by the Congress”.[19]
With a court order
Alternatively, the government may seek a court order permitting the surveillance using the FISA court.[20] Approval of a FISA application requires the court find probable cause that the target of the surveillance be a “foreign power” or an “agent of a foreign power”, and that the places at which surveillance is requested is used or will be used by that foreign power or its agent. In addition, the court must find that the proposed surveillance meet certain “minimization requirements” for information pertaining to U.S. persons.[21]
Physical searches
In addition to electronic surveillance, FISA permits the “physical search” of the “premises, information, material, or property used exclusively by” a foreign power. The requirements and procedures are nearly identical to those for electronic surveillance.
The Act created the Foreign Intelligence Surveillance Court (FISC) and enabled it to oversee requests for surveillance warrants by federal police agencies (primarily the F.B.I.) against suspected foreign intelligence agents inside the U.S. The court is located within the Department of Justice headquarters building. The court is staffed by eleven judges appointed by the Chief Justice of the United States to serve seven year terms.
Proceedings before the FISA court are ex parte and non-adversarial. The court hears evidence presented solely by the Department of Justice. There is no provision for a release of information regarding such hearings, or for the record of information actually collected.
Denials of FISA applications by the FISC may be appealed to the Foreign Intelligence Surveillance Court of Review. The Court of Review is a three judge panel. Since its creation, the court has come into session twice: in 2002 and 2008.
Remedies for violations
Both the subchapters covering physical searches and electronic surveillance provide for criminal and civil liability for violations of FISA.
Criminal sanctions follows violations of electronic surveillance by intentionally engaging in electronic surveillance under the color of law or through disclosing information known to have been obtained through unauthorized surveillance. The penalties for either act are fines up to $10,000, up to five years in jail, or both.[17]
In addition, the statute creates a cause of action for private individuals whose communications were unlawfully monitored. The statute permits actual damages of not less than $1,000 or $100 per day. In addition, that statute authorizes punitive damages and an award of attorney’s fees.[18] Similar liability is found under the subchapter pertaining to physical searches. In both cases, the statute creates an affirmative defense for a law enforcement agent acting within their official duties and pursuant to a valid court order. Presumably, such a defense is not available to those operating exclusively under presidential authorization.
Lone wolf amendment
In 2004 FISA was amended to include a “lone wolf” provision. 50 U.S.C.§ 1801(b)(1)(C). A “lone wolf” is a non-U.S. person who engages in or prepares for international terrorism. The provision amended the definition of “foreign power” to permit the FISA courts to issue surveillance and physical search orders without having to find a connection between the “lone wolf” and a foreign government or terrorist group. However, “if the court authorizes such a surveillance or physical search using this new definition of ‘agent of a foreign power’, the FISC judge has to find, in pertinent part, that, based upon the information provided by the applicant for the order, the target had engaged in or was engaging in international terrorism or activities in preparation therefor”.[22]
Constitutionality
Before FISA
In 1967 the Supreme Court of the United States held that the requirements of the Fourth Amendment applied equally to electronic surveillance and to physical searches. Katz v. United States, 389 U.S. 347 (1967). The Court did not address whether such requirements apply to issues of national security. Shortly after, in 1972, the Court took up the issue again in United States v. United States District Court, Plamondon, where the court held that court approval was required in order for the domestic surveillance to satisfy the Fourth Amendment. 407 U.S. 297 (1972). Justice Powell wrote that the decision did not address this issue that “may be involved with respect to activities of foreign powers or their agents”.
In the time immediately preceding FISA, a number of courts squarely addressed the issue of “warrantless wiretaps”. In both United States v. Brown, 484 F.2d 418 (5th Cir. 1973), and United States v. Butenko, 494 F.2d 593 (3rd Cir. 1974), the courts upheld warrantless wiretaps. In Brown, a U.S. citizen’s conversation was captured by a wiretap authorized by the Attorney General for foreign intelligence purposes. In Butenko, the court held a wiretap valid if the primary purpose was for gathering foreign intelligence information.
A plurality opinion in Zweibon v. Mitchell, 516 F.2d 594 (D.C. Cir. 1975), held that a warrant was required for the domestic surveillance of a domestic organization. In this case, the court found that the domestic organization was not a “foreign power or their agent”, and “absent exigent circumstances, all warrantless electronic surveillance is unreasonable and therefore unconstitutional.”
Post-FISA
There have been very few cases involving the constitutionality of FISA. In two lower court decisions, the courts found FISA constitutional. In the United States v. Duggan, the defendants were members of the Irish Republican Army. 743 F.2d 59 (2nd Cir., 1984). They were convicted for various violations regarding the shipment of explosives and firearms. The court held that there were compelling considerations of national security in the distinction between the treatment of U.S. citizens and non-resident aliens.
However, in a third case, the special review court for FISA, the equivalent of a Circuit Court Of Appeals, opined differently should FISA limit the President’s inherent authority for warrantless searches in the foreign intelligence area. In In re Sealed Case, 310 F.3d 717, 742 (Foreign Intel. Surv. Ct. of Rev. 2002) the special court stated “[A]ll the other courts to have decided the issue [have] held that the President did have inherent authority to conduct warrantless searches to obtain foreign intelligence information . . . . We take for granted that the President does have that authority and, assuming that is so, FISA could not encroach on the President’s constitutional power.”
Criticisms
K. A. Taipale of the World Policy Institute, James Jay Carafano of the Heritage Foundation,[23] and Philip Bobbitt of Columbia Law School,[24] among others,[25] have argued that FISA may need to be amended (to include, among other things, procedures for programmatic approvals) as it may no longer be adequate to address certain foreign intelligence needs and technology developments, including: the transition from circuit-based communications to packet-based communications; the globalization of communications infrastructure; and the development of automated monitoring techniques, including data mining and traffic analysis.[26]
The need for programmatic approval of technology-enabled surveillance programs is particularly crucial in foreign intelligence. See, for example, John R. Schmidt, the associate attorney general (1994–1997) in the Justice Department under President Bill Clinton,[27] recalling early arguments made by then-Attorney General Edward Levi to the Church Committee that foreign intelligence surveillance legislation should include provisions for programmatically authorizing surveillance programs because of the particular needs of foreign intelligence where “virtually continuous surveillance, which by its nature does not have specifically predetermined targets” may be required. In these situations, “the efficiency of a warrant requirement would be minimal.”
And, in a recent essay, Judge Richard A. Posner opined that FISA “retains value as a framework for monitoring the communications of known terrorists, but it is hopeless as a framework for detecting terrorists. [FISA] requires that surveillance be conducted pursuant to warrants based on probable cause to believe that the target of surveillance is a terrorist, when the desperate need is to find out who is a terrorist.”[28]
Amendments
Terrorist Surveillance Act of 2006
On March 16, 2006, Senators Mike DeWine (R-OH), Lindsey Graham (R-SC), Chuck Hagel (R-NE), and Olympia Snowe (R-ME) introduced the Terrorist Surveillance Act of 2006 (S.2455),[29][30] under which the President would be given certain additional limited statutory authority to conduct electronic surveillance of suspected terrorists in the United States subject to enhanced Congressional oversight. Also on March 16, 2006, Senator Arlen Specter (R-PA) introduced the National Security Surveillance Act of 2006 (S. 2453),[31][32] which would amend FISA to grant retroactive amnesty[33] for warrantless surveillance conducted under presidential authority and provide FISA court (FISC) jurisdiction to review, authorize, and oversight “electronic surveillance programs”. On May 24, 2006, Senator Specter and Senator Dianne Feinstein (D-CA) introduced the Foreign Intelligence Surveillance Improvement and Enhancement Act of 2006 (S. 3001) asserting FISA as the exclusive means to conduct foreign intelligence surveillance.
All three competing bills were the subject of Judiciary Committee hearings throughout the summer.[34] On September 13, 2006, the Senate Judiciary Committee voted to approve all three mutually exclusive bills, thus, leaving it to the full Senate to resolve.[35]
On July 18, 2006, U.S. Representative Heather Wilson (R-NM) introduced the Electronic Surveillance Modernization Act (H.R. 5825). Wilson’s bill would give the President the authority to authorize electronic surveillance of international phone calls and e-mail linked specifically to identified terrorist groups immediately following or in anticipation of an armed or terrorist attack on the United States. Surveillance beyond the initial authorized period would require a FISA warrant or a presidential certification to Congress. On September 28, 2006 the House of Representatives passed Wilson’s bill and it was referred to the Senate.[36]
Protect America Act of 2007
On July 28, 2007, President Bush called on Congress to pass legislation to reform the FISA in order to ease restrictions on surveillance of terrorist suspects where one party (or both parties) to the communication are located overseas. He asked that Congress pass the legislation before its August 2007 recess. On August 3, 2007, the Senate passed a Republican-sponsored version of FISA (S. 1927) in a vote of 60 to 28. The House followed by passing the bill, 227–183. The Protect America Act of 2007 (Pub.L. 110–55, S. 1927) was then signed into law by George W. Bush on 2007-08-05.[37]
Under the Protect America Act of 2007, communications that begin or end in a foreign country may be wiretapped by the U.S. government without supervision by the FISA Court. The Act removes from the definition of “electronic surveillance” in FISA any surveillance directed at a person reasonably believed to be located outside the United States. As such, surveillance of these communications no longer requires a government application to, and order issuing from, the FISA Court.
The Act provides procedures for the government to “certify” the legality of an acquisition program, for the government to issue directives to providers to provide data or assistance under a particular program, and for the government and recipient of a directive to seek from the FISA Court, respectively, an order to compel provider compliance or relief from an unlawful directive. Providers receive costs and full immunity from civil suits for compliance with any directives issued pursuant to the Act.
A summary of key provisions follows. The Act empowers the Attorney General or Director of National Intelligence (“DNI”) to authorize, for up to one year, the acquisition of communications concerning “persons reasonably believed to be outside the United States” if the Attorney General and DNI determine that each of five criteria has been met:
There are reasonable procedures in place for determining that the acquisition concerns persons reasonably believed to be located outside the United States;
The acquisition does not constitute electronic surveillance (meaning it does not involve solely domestic communications);
The acquisition involves obtaining the communications data from or with the assistance of a communications service provider who has access to communications;
A significant purpose of the acquisition is to obtain foreign intelligence information; and
Minimization procedures outlined in the FISA will be used.
This determination by the Attorney General and DNI must be certified in writing, under oath, and supported by appropriate affidavit(s). If immediate action by the government is required and time does not permit the preparation of a certification, the Attorney General or DNI can direct the acquisition orally, with a certification to follow within 72 hours. The certification is then filed with the FISA Court.
Once the certification is filed with the FISA Court, the Attorney General or DNI can direct a provider to undertake or assist in the undertaking of the acquisition.
If a provider fails to comply with a directive issued by the Attorney General or DNI, the Attorney General may seek an order from the FISA Court compelling compliance with the directive. Failure to obey an order of the FISA Court may be punished as a contempt of court.
Likewise, a person receiving a directive may challenge the legality of that directive by filing a petition with the FISA Court. An initial review must be conducted within 48 hours of the filing to determine whether the petition is frivolous, and a final determination concerning any non-frivolous petitions must be made – in writing – within 72 hours of receipt of the petition.
Determinations of the FISA Court may be appealed to the Foreign Intelligence Court of Appeals, and a petition for a writ of certiorari of a decision from the FICA can be made to the U.S. Supreme Court.
All petitions must be filed under seal.
The Act allows providers to be compensated, at the prevailing rate, for providing assistance as directed by the Attorney General or DNI.
The Act provides explicit immunity from civil suit in any federal or state court for providing any information, facilities, or assistance in accordance with a directive under the Act.
Within 120 days, the Attorney General must submit to the FISA Court for its approval the procedures by which the government will determine that acquisitions authorized by the Act conform with the Act and do not involve purely domestic communications. The FISA Court then will determine whether the procedures comply with the Act. The FISA Court thereafter will enter an order either approving the procedures or directing the government to submit new procedures within 30 days or cease any acquisitions under the government procedures. The government may appeal a ruling of the FISA Court to the FICA and ultimately the Supreme Court.
On a semiannual basis, the Attorney General shall inform the Intelligence and Judiciary Committees of the House and Senate of incidents of noncompliance with a directive issued by the Attorney General or the DNI, incidents of noncompliance with FISA Court-approved procedures by the Intelligence Community, and the number of certifications and directives issued during the reporting period.
The amendments to FISA made by the Act expire 180 days after enactment, except that any order in effect on the date of enactment remains in effect until the date of expiration of such order and such orders can be reauthorized by the FISA Court.”[38] The Act expired on February 17, 2008.
Subsequent developments
Legal experts experienced in national security issues are divided on how broadly the new law could be interpreted or applied. Some believe that due to subtle changes in the definitions of terms such as “electronic surveillance”, it could empower the government to conduct warrantless physical searches and even seizures of communications and computer devices and their data which belong to U.S. citizens while they are in the United States, if the government contended that those searches and potential seizures were related to its surveillance of parties outside the United States. Intelligence officials, while declining to comment directly on such possibilities, respond that such interpretations are overly broad readings of the act, and unlikely to actually occur. Democratic lawmakers have nonetheless indicated that they are planning to introduce a revised version of the legislation for consideration as early as September 2007.[39]
Also on September 10, DNI Mike McConnell testified before the Senate Committee on Homeland Security and Governmental Affairs that the Protect America Act had helped foil a major terror plot in Germany. U.S. intelligence-community officials questioned the accuracy of McConnell’s testimony and urged his office to correct it, which he did in a statement issued September 12, 2007. Critics cited the incident as an example of the Bush administration’s exaggerated claims and contradictory statements about surveillance activities. Counterterrorism officials familiar with the background of McConnell’s testimony said they did not believe he made inaccurate statements intentionally as part of any strategy by the administration to persuade Congress to make the new eavesdropping law permanent. Those officials said they believed McConnell gave the wrong answer because he was overwhelmed with information and merely mixed up his facts.[41]
Speaking at National Security Agency headquarters in Fort Meade, Maryland on September 19, 2007, President George W. Bush urged Congress to make the provisions of the Protect America Act permanent. Bush also called for retroactive immunity for telecommunications companies who had cooperated with government surveillance efforts, saying, “It’s particularly important for Congress to provide meaningful liability protection to those companies now facing multibillion-dollar lawsuits only because they are believed to have assisted in efforts to defend our nation, following the 9/11 attacks”.[42]
On October 4, 2007, the bipartisan Liberty and Security Committee of the Constitution Project, co-chaired by David Keene and David D. Cole, issued its “Statement on the Protect America Act”.[43] The Statement urged Congress not to reauthorize the PAA, saying the language of the bill “runs contrary to the tripartite balance of power the Framers envisioned for our constitutional democracy, and poses a serious threat to the very notion of government of the people, by the people and for the people”. Some in the legal community have questioned the constitutionality of any legislation that would retroactively immunize telecommunications firms alleged to have cooperated with the government from civil liability for having potentially violated their customers’ privacy rights.[44]
In an article appearing in the January/February 2008 issue of the Institute of Electrical and Electronics Engineers journal of Security and Privacy, noted technology experts from academia and the computing industry found significant flaws in the technical implementation of the Protect America Act which they said created serious security risks, including the danger that such a surveillance system could be exploited by unauthorized users, criminally misused by trusted insiders, or abused by the government.[45]
On October 7, 2007, the Washington Post reported that House Democrats planned to introduce alternative legislation which would provide for one-year “umbrella” warrants, and would require the Justice Department inspector general to audit the use of those warrants and issue quarterly reports to a special FISA court and to Congress. The proposed bill would not include immunity for telecommunications firms facing lawsuits in connection with the administration’s NSA warrantless surveillance program. House Democrats said that as long as the administration withholds requested documents explaining the basis for the program that they cannot consider immunity for firms alleged to have facilitated it.[46] On October 10, 2007 comments on the White House South Lawn, President Bush said he would not sign any bill that did not provide retroactive immunity for telecommunications corporations.[47]
On October 18, 2007, the House Democratic leadership put off a vote on the proposed legislation by the full chamber to avoid consideration of a Republican measure that made specific references to Osama bin Laden. At the same time, the Senate Intelligence Committee reportedly reached a compromise with the White House on a different proposal that would give telephone carriers legal immunity for any role they played in the National Security Agency’s domestic eavesdropping program approved by President Bush after the Sept. 11 terrorist attacks.[48]
On November 15, 2007, the Senate Judiciary Committee voted 10-9 along party lines to send an alternative measure to the full Senate other than the one the intelligence committee had crafted with the White House. The proposal would leave to the full Senate whether or not to provide retroactive immunity to telecommunications firms that cooperated with the NSA. Judiciary Committee chairman Patrick Leahy said that granting such immunity would give the Bush administration a “blank check” to do what it wants without regard to the law. Arlen Specter of Pennsylvania, the top Republican on the committee, said that court cases may be the only way Congress can learn exactly how far outside the law the administration has gone in eavesdropping in the United States. When the full Senate takes up the bill, Specter is expected to offer a compromise that would shield the companies from financial ruin but allow lawsuits to go forward by having the federal government stand in for the companies at trial.[49]
On the same day, the House of Representatives voted 227-189 to approve a Democratic bill that would expand court oversight of government surveillance inside the United States while denying immunity to telecom companies. House Judiciary Committee chairman John Conyers left the door open to an immunity deal in the future, but said that the White House must first give Congress access to classified documents specifying what the companies did that requires legal immunity.[50]
Wikisource has original text related to this article:
In February 2008, the Senate passed the version of the new FISA that would allow telecom companies immunity. On March 13, 2008, the U.S. House of Representatives held a secret session to discuss related information. On March 14, the House voted 213-197 to approve a bill that would not grant telecom immunity — far short of the 2/3 majority required to override a Presidential veto.[51] The Senate and House bills are compared and contrasted in a June 12, 2008 report from the Congressional Research Service.[52]
On March 13, 2008, the House of Representatives held a secret, closed door meeting to debate changes to the FISA bill.[53][54]
Glenn Greenwald (born March 6, 1967) is an American political journalist, lawyer, columnist, blogger, and author. In August 2012, he left Salon.com, where he was a columnist, to become a columnist at the US edition of The Guardian newspaper,[1][2] to which he has contributed since June 2011.[3][4][5]
Greenwald practiced law in the Litigation Department at Wachtell, Lipton, Rosen & Katz (1994–1995); in 1996 he co-founded his own litigation firm, called Greenwald Christoph & Holland (later renamed Greenwald Christoph PC), where he litigated cases concerning issues of U.S. constitutional law and civil rights.[6][18] According to Greenwald, “I decided voluntarily to wind down my practice in 2005 because I could, and because, after ten years, I was bored with litigating full-time and wanted to do other things which I thought were more engaging and could make more of an impact, including political writing.”[18]
In February 2007, Greenwald became a contributing writer at Salon.com, and the new column and blog superseded Unclaimed Territory, though Salon.com prominently features hyperlinks to it in Greenwald’s dedicated biographical section.[19][20]
Greenwald’s criticism of the conditions in which U.S. Army Private Bradley Manning, the accused WikiLeaks leaker, was being held ultimately led to a formal investigation by the U.N. high official on torture,[26][27] denunciations by Amnesty International,[28] and the resignation of State Department spokesman Philip J. Crowley after he publicly criticized Manning’s detention conditions.[29] Since then, Greenwald has been a strong supporter of Manning. He calls Manning “a whistle-blower acting with the noblest of motives”, and “a national hero similar to Daniel Ellsberg.”[30]
The Guardian
Greenwald left Salon.com on August 20, 2012 for The Guardian, citing “the opportunity to reach a new audience, to further internationalize my readership, and to be re-invigorated by a different environment” as reasons for the move.[31]
Greenwald has been placed on numerous ‘top 50′ and ‘top 25′ lists of columnists in the United States.[37][38][39][40][41][42][43][44][45] In June, 2012, Newsweek magazine named him one of America’s Top 10 Opinionists, saying that “a righteous, controlled, and razor-sharp fury runs through a great deal” of his writing, and: “His independent persuasion can make him a danger or an asset to both sides of the aisle.”[46]
Personal life
Greenwald is gay, and lives most of the time in Rio de Janeiro, the hometown of his Brazilian partner, David Michael Miranda.[18][47][48][49][50] In a profile in Out magazine, Greenwald explained that his residence in Brazil is due to the fact that American law, the Defense of Marriage Act (DOMA), bars the federal recognition of same-sex marriages and thus prevents his partner from obtaining immigration rights in the US.[51]
Greenwald and his partner have 11 dogs, all rescued from the street,[52][53], and he frequently picks up dogs from the street and uses his platforms to find homes for them.[54][55][56]
Books
Greenwald’s first book, How Would a Patriot Act? Defending American Values From a President Run Amok, was published by Working Assets in 2006. It was a New York Times bestseller,[57] and ranked #1 on Amazon.com both before its publication (due to pre-orders based on attention from ‘UT’ readers and other bloggers) and for several days after its release, ending its first week at #293.[58]
A Tragic Legacy, his second book, examines the presidency of George W. Bush “with an emphasis on his personality traits and beliefs that drove the presidency (along with an emphasis on how and why those personality traits have led to a presidency that has failed to historic proportions).”[59] Published in hardback by Crown (a division of Random House) on June 26, 2007 and reprinted in a paperback edition by Three Rivers Press on April 8, 2008, it too was a New York Times Best Seller, also ranking #1 for a day on Amazon.com’s Non-Fiction Best Seller List and #2 the next day (also due to heavy “discussions and promotions by blogs – a campaign catalyzed by Jane Hamsher [at FireDogLake]“, according to Greenwald).[60]
His third book, entitled Great American Hypocrites: Toppling the Big Myths of Republican Politics, was published by Random House in April 2008, the same month that Three Rivers Press reissued A Tragic Legacy in paperback.[61][62]
His fourth book, With Liberty and Justice for Some: How the Law Is Used to Destroy Equality and Protect the Powerful, was released by Metropolitan Books (of Henry Holt and Company) in October 2011.
Political views
Greenwald is critical of actions jointly supported by Democrats and Republicans, writing: “the worst and most tyrannical government actions in Washington are equally supported on a fully bipartisan basis.”[63] In the preface to his first book, How Would a Patriot Act? (2006), Greenwald opens with some of his own personal political history, describing his ‘pre-political’ self as neither liberal nor conservative as a whole, voting neither for George W. Bush nor for any of his rivals (indeed, not voting at all).[64]
Bush’s ascendancy to the U.S. Presidency “changed” Greenwald’s previous uninvolved political attitude toward the electoral process “completely”:
Over the past five years, a creeping extremism has taken hold of our federal government, and it is threatening to radically alter our system of government and who we are as a nation. This extremism is neither conservative nor liberal in nature, but is instead driven by theories of unlimited presidential power that are wholly alien, and antithetical, to the core political values that have governed this country since its founding”; for, “the fact that this seizure of ever-expanding presidential power is largely justified through endless, rank fear-mongering—fear of terrorists, specifically—means that not only our system of government is radically changing, but so, too, are our national character, our national identity, and what it means to be American.”[64]
Believing that “It is incumbent upon all Americans who believe in that system, bequeathed to us by the founders, to defend it when it is under assault and in jeopardy. And today it is”, he stresses: “I did not arrive at these conclusions eagerly or because I was predisposed by any previous partisan viewpoint. Quite the contrary.”[64]
Resistant to applying ideological labels to himself, he emphasizes repeatedly that he is a strong advocate for U.S. constitutional “balance of powers”[14] and for constitutionally-protected civil and political rights in his writings and public appearances.[6]
Throughout his work he has relentlessly criticized the policies of the George W. Bushadministration and those who support or enable it, arguing that most of the American “Corporate News Media” excuse Bush’s policies and echo administration talking points rather than asking hard questions.[49][32]
Regarding civil liberties in the age of Obama, he elaborated on his conception of change when he said, “I think the only means of true political change will come from people working outside of that [two-party electoral] system to undermine it, and subvert it, and weaken it, and destroy it; not try to work within it to change it.”[65] He did, however, raise money for Russ Feingold’s 2010 Senate re-election bid,[66] Bill Halter’s 2010 primary challenge to Democratic Sen. Blanche Lincoln [67] as well as several Congressional candidates in 2012 he described as “unique”.[68]
Greenwald has been criticized regarding his positions which are critical of Israel’s foreign policy and influence on U.S. politics.[69][70][71][72][73]
“There is also concern about the possibility of a breakout of inflation, although current inflation risk is not considered unmanageable, and of an unsustainable bubble in equity and fixed-income markets given current prices.”
“Uncertainty exists about how markets will reestablish normal valuations when the Fed withdraws from the market. It will likely be difficult to unwind policy accommodation, and the end of monetary easing may be painful for consumers and businesses.”
“Uncertainty about fiscal and monetary policy is deterring business investment that would spur growth.”
Simon & Garfunkel, Bridge Over Troubled Water, Central Park
When you’re weary, feeling small,
When tears are in your eyes, I will dry them all;
I’m on your side. when times get rough
And friends just cant be found,
Like a bridge over troubled water
I will lay me down.
Like a bridge over troubled water
I will lay me down.
When you’re down and out,
When you’re on the street,
When evening falls so hard
I will comfort you.
Ill take your part.
When darkness comes
And pains is all around,
Like a bridge over troubled water
I will lay me down.
Like a bridge over troubled water
I will lay me down.
Sail on silver girl,
Sail on by.
Your time has come to shine.
All your dreams are on their way.
See how they shine.
If you need a friend
Im sailing right behind.
Like a bridge over troubled water
I will ease your mind.
Like a bridge over troubled water
I will ease your mind.
Federal Advisory Council (FAC) May 17, 2013 Report
Fed’s Advisory Council Admits We’re Screwed
Jim Rogers: Fed’s ‘Artificial’ Inflation of Economy Will End Badly
Marc Faber Sees Bubble in Safest Government Bonds
Dr Marc Faber – US is in 50 100 trillion worth of debt!
Bernanke Has Losing Control Over The Economy – Bill Gross
James Grant (September 2012)
A rare interview with an influential Financial Thought Leader and financial historian. James Grant, founder and editor of Grant’s Interest Rate Observer, will discuss why the Federal Reserve’s policies of zero interest rates and massive purchases of U.S. Treasury and mortgage-backed bonds are dangerous to the economy and damaging to savers.
WealthTrack Episode 914, 09-28-12
“The Fed is treading water…”
“We’re experiencing the worst economic recovery since WWII.”
Joint Economic Committee Chairman Kevin Brady presents his opening statement to the committee and witness Federal Reserve Chairman Ben Bernanke. The Fed Chairman agreed that monetary analysis alone can’t boost longterm employment during the May 22nd JEC hearing “The Economic Outlook”
“What is the Fed’s exit strategy?”
JEC Chairman Kevin Brady asks for Federal Reserve Chairman Ben Bernanke’s exit strategy for ending quantitative easing this summer. Chairman Brady is pushing to return the Fed to a single mandate of maintaining the sound purchasing power of the dollar
Rep. Campbell Questions Fed Chairman on Economic Outlook
May 22nd 2013 CNBC Stock Market (Ben Bernanke testifies on Capitol Hill; Stocks hit record highs)
A Conversation with Federal Reserve Chairman Ben Bernanke
Ron Paul: This is Price Fixing at Its Worst – Fox Business 3/20/2013
Quantitative Easing Explained
The Treasury and the Fed are Robbing Savers – James Rickards
Ron Paul to Ben Bernanke: Price Fixing Doesn’t Work, So Why Does The Fed Do It?
The Collapse of The American Dream Animation
The Creature from Jekyll Island | G. Edward Griffin
The Money Masters ~ Full Movie
The Ascent of Money: A Financial History of The World by Niall Ferguson Epsd. 1-5 (Full Documentary)
Money, Banking and the Federal Reserve
Lew Rockwell explains how the Federal Reserve Enables War, Empire, and Destroys the Middle Class
Members of the Federal Reserve’s advisory council, which includes the Board of Governors, have expressed strong concerns over the Fed’s low-interest rate policies and its bond-purchase program, which they say could trigger unmanageable inflation and an “unsustainable bubble” in the stock and bond markets.
Minutes of the Federal Advisory Council meeting held on May 17 were published Friday on the Fed’s website and reveal concerns among its officials over the long-term ramifications of its quantitative easing policies.
“There is also concern about the possibility of a breakout of inflation, although current inflation risk is not considered unmanageable, and of an unsustainable bubble in equity and fixed-income markets given current prices,” according to the minutes of the council meeting.
Federal Reserve Advisory Committee Worries About Inflation, “Unsustainable Bubble” In Stocks And Bonds
Members of the Federal Reserve’s advisory council, which includes the Board of Governors, have expressed strong concerns over the Fed’s low-interest rate policies and its bond-purchase program, which they say could trigger unmanageable inflation and an “unsustainable bubble” in the stock and bond markets.
Minutes of the Federal Advisory Council meeting held on May 17 were published Friday on the Fed’s website and reveal concerns among its officials over the long-term ramifications of its quantitative easing policies.
“There is also concern about the possibility of a breakout of inflation, although current inflation risk is not considered unmanageable, and of an unsustainable bubble in equity and fixed-income markets given current prices,” according to the minutes of the council meeting.
Some of the members of the advisory council, consisting of private bankers from each of the Fed’s 12 banking districts, pointed out that near-zero interest rates could not be sustained in the long run.
A spike in inflation could force the Fed to hike interest rates, hurting business confidence and consumer spending, and prove disastrous to the U.S economy, which is still clawing its way back from the debilitating effects of the 2008 financial crisis.
Although the council’s members acknowledged that the Fed’s current policies have aided a slow recovery, its effectiveness on employment generation is not clear, they noted. ”Uncertainty about fiscal and monetary policy is deterring business investment that would spur growth,” the Council noted.
Unemployment in the United States dipped marginally to 7.50 percent in April 2013 from 7.60 percent in March.
The advisory council echoed the concerns of some economists that the Fed’s massive bond-buying exercise could potentially expose the banks to systemic financial risks and structural problems.
“Net interest margins are very compressed, making favorable earnings trends difficult and encouraging banks to take on more risk. The Fed’s aggressive purchases of 15-year and 30-year MBS have depressed yields for the “bread and butter” investment in most bank portfolios; banks seeking additional yield have had to turn to investment options with longer durations, lower liquidity, and/or higher credit risk,” the minutes said.
Some members also expressed anxiety over the recent surge in markets stating that the equity and fixed-income markets are bloated. On May 28, consumer confidence and higher home prices help the Dow Jones Industrial Average scale another record high to end the day up 106 points, or 0.7 percent to 15,409.
The strongly worded sentiments expressed in the minutes clearly suggest that overvalued markets could come down to more realistic levels when the Fed stops its quantitative easing program.
“Uncertainty exists about how markets will reestablish normal valuations when the Fed withdraws from the market. It will likely be difficult to unwind policy accommodation, and the end of monetary easing may be painful for consumers and businesses,” the minutes stated.
The Federal Advisory Council (FAC), which is composed of twelve representatives of the banking industry, consults with and advises the Board on all matters within the Board’s jurisdiction. The council ordinarily meets four times a year, the minimum number of meetings required by the Federal Reserve Act. These meetings are always held in Washington, D.C., customarily on the first Friday of February, May, September, and December, although occasionally the meetings are set for different times to suit the convenience of either the council or the Board. Each year, each Reserve Bank chooses one person to represent its District on the FAC, and members customarily serve three one-year terms. The members elect their own officers.
Members
Joseph L. Hooley, First District
James P. Gorman, Second District
Bharat B. Masrani, Third District
James E. Rohr, Fourth District
Kelly S. King, Fifth District
Daryl G. Byrd, Sixth District
David W. Nelms, Seventh District
D. Bryan Jordan, Eighth District
Patrick J. Donovan, Ninth District
Jonathan M. Kemper, Tenth District
Richard W. Evans, Jr., Eleventh District
J. Michael Shepherd, Twelfth District
James E. Annable, Secretary
Why The Fed Balance Sheet Matters
On March 12, the Wall Street Journal published an opinion piece by Professor Alan Blinder, currently a Princeton faculty member in economics, the former Vice Chairman of the Federal Reserve from 1994 to 1996, and rumored to be on the short list to replace Ben Bernanke in 2014. In his column, “Easing Angst about Fed Easing,” Blinder downplays widespread concern in financial circles (including this small one) that the Fed is painting itself into a corner via its ongoing efforts to stimulate the U.S. job growth quantitative easing.
With its balance sheet now having grown to $3.1 trillion, or about 20% of U.S. GDP, the Fed has vowed to keep up its $85 billion per month of bond purchases (or, $1 trillion per annum) “until the outlook for the labor market has improved substantially,” with 6.5% being the magic number mentioned by several key members of the FOMC. In the face of these staggering numbers, Blinder counsels one and all to adopt the stance of Mad Magazine’s Alfred E. Newman: “What, me worry?”
Critics of the Fed’s QE program worry that as trillions in monetary stimulus accumulate it becomes increasingly difficult for the Fed to reverse its easing policy and shrink its balance sheet from its current size back down to its pre-2008 level of about 6% the size of U.S. GDP. With the current unemployment rate at 7.6%, Morgan Stanley estimates that it will take between 5 and 6 years at a monthly job creation rate of 150,000 new jobs per month. In dollar terms, if the Morgan Stanley analysis is to be believed, the Fed balance sheet will have grown from $3 trillion to $9 trillion, about 50% of annual estimated U.S. GDP in 2019, assuming a minimally satisfactory 2.5% annual GDP growth rate over the next 6 years, though we note that the current rate of GDP growth is in the 2.0% range.
Would the Fed really hold its course on monthly bond purchases for years beyond its estimated “exit date” from QE in the middle of 2015? We doubt it: the Fed is mostly likely looking for the earliest possible time to declare victory and stop the bond purchases. Vice Chairman Yellen has indicated that two consecutive quarters of employment growth resulting in a drop in unemployment of 0.5% or more is probably enough to for the Fed to declare that the economy has reached “escape velocity” (their phrase) and thus begin to wind down QE.
Of course, a reduction in unemployment does not mean an increase in jobs. We have seen a disturbing number of able-bodied jobseekers simply give up looking for work over the past 4 years. The U.S. Labor Participation Rate (LPR) has gone from 65.6% in March 2009 to 63.3% in March 2013, meaning about 3.5 million workers have dropped out of the labor force. Real, sustainable economic growth can’t be achieved by increasing the number of permanently unemployed depending upon welfare programs.
The H.4.1 statistical release, “Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks,” is typically published on Thursday afternoon around 4:30 p.m.
The release presents a balance sheet for each Federal Reserve Bank, a consolidated balance sheet for all 12 Reserve Banks, an associated statement that lists the factors affecting reserve balances of depository institutions, and several other tables presenting information on the assets, liabilities, and commitments of the Federal Reserve Banks.
Open Market Operations
Open market operations (OMOs)–the purchase and sale of securities in the open market by a central bank–are a key tool used by the Federal Reserve in the implementation of monetary policy. The short-term objective for open market operations is specified by the Federal Open Market Committee (FOMC). Historically, the Federal Reserve has used OMOs to adjust the supply of reserve balances so as to keep the federal funds rate–the interest rate at which depository institutions lend reserve balances to other depository institutions overnight–around the target established by the FOMC.
The Federal Reserve’s approach to the implementation of monetary policy has evolved considerably since the financial crisis, and particularly so since late 2008 when the FOMC established a near-zero target range for the federal funds rate. Since the end of 2008, the Federal Reserve has greatly expanded its holding of longer-term securities through open market purchases with the goal of putting downward pressure on longer-term interest rates and thus supporting economic activity and job creation by making financial conditions more accommodative.
FEDERAL RESERVE statistical release
H.4.1
Factors Affecting Reserve Balances of Depository Institutions and
Condition Statement of Federal Reserve Banks May 30, 2013
1. Factors Affecting Reserve Balances of Depository Institutions
Millions of dollars
Reserve Bank credit, related items, and Averages of daily figures Wednesday
reserve balances of depository institutions at Week ended Change from week ended May 29, 2013
Federal Reserve Banks May 29, 2013 May 22, 2013 May 30, 2012
Reserve Bank credit 3,352,693 + 16,034 + 545,682 3,342,060
Securities held outright (1) 3,128,758 + 19,241 + 518,071 3,119,382
U.S. Treasury securities 1,881,778 + 11,849 + 218,001 1,883,559
Bills (2) 0 0 - 18,423 0
Notes and bonds, nominal (2) 1,787,525 + 11,790 + 219,439 1,789,288
Notes and bonds, inflation-indexed (2) 81,646 0 + 13,992 81,646
Inflation compensation (3) 12,607 + 59 + 2,992 12,624
Federal agency debt securities (2) 71,887 - 166 - 21,365 70,890
Mortgage-backed securities (4) 1,175,093 + 7,558 + 321,436 1,164,934
Unamortized premiums on securities held outright (5) 201,010 + 778 + 68,831 200,824
Unamortized discounts on securities held outright (5) -1,722 - 46 + 572 -1,724
Repurchase agreements (6) 0 0 0 0
Loans 382 - 56 - 5,280 418
Primary credit 10 - 13 - 9 47
Secondary credit 0 0 0 0
Seasonal credit 51 + 5 + 20 49
Term Asset-Backed Securities Loan Facility (7) 321 - 48 - 5,291 321
Other credit extensions 0 0 0 0
Net portfolio holdings of Maiden Lane LLC (8) 1,428 - 1 - 2,444 1,424
Net portfolio holdings of Maiden Lane II LLC (9) 64 0 + 45 64
Net portfolio holdings of Maiden Lane III LLC (10) 22 0 - 15,145 22
Net portfolio holdings of TALF LLC (11) 388 0 - 453 388
Float -663 + 56 - 10 -1,112
Central bank liquidity swaps (12) 1,771 - 5,506 - 20,397 1,771
Other Federal Reserve assets (13) 21,254 + 1,567 + 1,892 20,603
Foreign currency denominated assets (14) 23,183 + 212 - 1,958 23,238
Gold stock 11,041 0 0 11,041
Special drawing rights certificate account 5,200 0 0 5,200
Treasury currency outstanding (15) 45,080 + 14 + 606 45,080
Total factors supplying reserve funds 3,437,196 + 16,260 + 544,330 3,426,619
Note: Components may not sum to totals because of rounding. Footnotes appear at the end of the table.
1. Factors Affecting Reserve Balances of Depository Institutions (continued)
Millions of dollars
Reserve Bank credit, related items, and Averages of daily figures Wednesday
reserve balances of depository institutions at Week ended Change from week ended May 29, 2013
Federal Reserve Banks May 29, 2013 May 22, 2013 May 30, 2012
Currency in circulation (15) 1,190,732 + 4,929 + 82,209 1,192,301
Reverse repurchase agreements (16) 86,575 - 3,595 - 3,745 88,177
Foreign official and international accounts 86,575 - 3,595 - 3,745 88,177
Others 0 0 0 0
Treasury cash holdings 152 - 8 + 10 152
Deposits with F.R. Banks, other than reserve balances 116,132 - 1,920 + 18,392 60,744
Term deposits held by depository institutions 10,496 + 10,496 + 7,443 10,496
U.S. Treasury, General Account 13,502 - 19,731 - 54,302 14,298
Foreign official 11,031 + 82 + 10,901 11,024
Service-related 0 0 - 1,903 0
Required clearing balances 0 0 - 1,903 0
Adjustments to compensate for float 0 0 0 0
Other 81,102 + 7,232 + 56,251 24,925
Other liabilities and capital (17) 64,405 - 656 - 8,826 62,656
Total factors, other than reserve balances,
absorbing reserve funds 1,457,996 - 1,250 + 88,040 1,404,030
Reserve balances with Federal Reserve Banks 1,979,200 + 17,510 + 456,290 2,022,589
Note: Components may not sum to totals because of rounding.
1. Includes securities lent to dealers under the overnight securities lending facility; refer to table
1A.
2. Face value of the securities.
3. Compensation that adjusts for the effect of inflation on the original face value of
inflation-indexed securities.
4. Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. Current face value of the securities, which
is the remaining principal balance of the underlying mortgages.
5. Reflects the premium or discount, which is the difference between the purchase price and the face
value of the securities that has not been amortized. For U.S. Treasury and Federal agency debt
securities, amortization is on a straight-line basis. For mortgage-backed securities, amortization is on an
effective-interest basis.
6. Cash value of agreements.
7. Includes credit extended by the Federal Reserve Bank of New York to eligible borrowers through the
Term Asset-Backed Securities Loan Facility.
8. Refer to table 4 and the note on consolidation accompanying table 9.
9. Refer to table 5 and the note on consolidation accompanying table 9.
10. Refer to table 6 and the note on consolidation accompanying table 9.
11. Refer to table 7 and the note on consolidation accompanying table 9.
12. Dollar value of foreign currency held under these agreements valued at the exchange rate to be used
when the foreign currency is returned to the foreign central bank. This exchange rate equals the
market exchange rate used when the foreign currency was acquired from the foreign central bank.
13. Includes accrued interest, which represents the daily accumulation of interest earned, and other
accounts receivable. Also, includes Reserve Bank premises and equipment net of allowances for
depreciation.
14. Revalued daily at current foreign currency exchange rates.
15. Estimated.
16. Cash value of agreements, which are collateralized by U.S. Treasury securities, federal agency debt
securities, and mortgage-backed securities.
17. Includes the liabilities of Maiden Lane LLC, Maiden Lane II LLC, Maiden Lane III LLC, and TALF LLC
to entities other than the Federal Reserve Bank of New York, including liabilities that have recourse
only to the portfolio holdings of these LLCs. Refer to table 4 through table 7 and the note on
consolidation accompanying table 9. Also includes the liability for interest on Federal Reserve notes due
to U.S. Treasury. Refer to table 8 and table 9.
Sources: Federal Reserve Banks and the U.S. Department of the Treasury.
1A. Memorandum Items
Millions of dollars
Memorandum item Averages of daily figures Wednesday
Week ended Change from week ended May 29, 2013
May 29, 2013 May 22, 2013 May 30, 2012
Securities held in custody for foreign official and
international accounts 3,314,859 + 3,153 + 200,827 3,317,119
Marketable U.S. Treasury securities (1) 2,972,117 + 8,765 + 265,056 2,976,377
Federal agency debt and mortgage-backed securities (2) 304,519 - 5,389 - 65,005 302,659
Other securities (3) 38,223 - 223 + 775 38,083
Securities lent to dealers 21,242 + 829 + 3,988 22,411
Overnight facility (4) 21,242 + 829 + 3,988 22,411
U.S. Treasury securities 20,111 + 692 + 3,390 21,302
Federal agency debt securities 1,131 + 136 + 598 1,109
Note: Components may not sum to totals because of rounding.
1. Includes securities and U.S. Treasury STRIPS at face value, and inflation compensation on TIPS.
Does not include securities pledged as collateral to foreign official and international account holders
against reverse repurchase agreements with the Federal Reserve presented in tables 1, 8, and 9.
2. Face value of federal agency securities and current face value of mortgage-backed securities, which
is the remaining principal balance of the underlying mortgages.
3. Includes non-marketable U.S. Treasury securities, supranationals, corporate bonds, asset-backed
securities, and commercial paper at face value.
4. Face value. Fully collateralized by U.S. Treasury securities.
2. Maturity Distribution of Securities, Loans, and Selected Other Assets and Liabilities, May 29, 2013
Millions of dollars
Remaining Maturity Within 15 16 days to 91 days to Over 1 year Over 5 year Over 10 All
days 90 days 1 year to 5 years to 10 years years
Loans (1) 92 4 0 321 0 ... 418
U.S. Treasury securities (2)
Holdings 1 4 308 520,574 875,579 487,094 1,883,559
Weekly changes 0 0 0 + 7 + 3,661 + 2,737 + 6,405
Federal agency debt securities (3)
Holdings 0 5,177 21,631 39,691 2,044 2,347 70,890
Weekly changes - 1,163 0 0 0 0 0 - 1,163
Mortgage-backed securities (4)
Holdings 0 0 1 1 2,692 1,162,240 1,164,934
Weekly changes 0 0 0 0 - 56 - 13,796 - 13,851
Asset-backed securities held by
TALF LLC (5) 0 0 0 0 0 0 0
Repurchase agreements (6) 0 0 ... ... ... ... 0
Central bank liquidity swaps (7) 0 1,771 0 0 0 0 1,771
Reverse repurchase agreements (6) 88,177 0 ... ... ... ... 88,177
Term deposits 0 10,496 0 ... ... ... 10,496
Note: Components may not sum to totals because of rounding.
...Not applicable.
1. Excludes the loans from the Federal Reserve Bank of New York (FRBNY) to Maiden Lane LLC, Maiden
Lane II LLC, Maiden Lane III LLC, and TALF LLC. The loans were eliminated when preparing the FRBNY's
statement of condition consistent with consolidation under generally accepted accounting principles.
2. Face value. For inflation-indexed securities, includes the original face value and compensation
that adjusts for the effect of inflation on the original face value of such securities.
3. Face value.
4. Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. Current face value of the securities, which
is the remaining principal balance of the underlying mortgages.
5. Face value of asset-backed securities held by TALF LLC, which is the remaining principal balance of
the underlying assets.
6. Cash value of agreements.
7. Dollar value of foreign currency held under these agreements valued at the exchange rate to be used
when the foreign currency is returned to the foreign central bank. This exchange rate equals the
market exchange rate used when the foreign currency was acquired from the foreign central bank.
3. Supplemental Information on Mortgage-Backed Securities
Millions of dollars
Account name Wednesday
May 29, 2013
Mortgage-backed securities held outright (1) 1,164,934
Commitments to buy mortgage-backed securities (2) 80,845
Commitments to sell mortgage-backed securities (2) 0
Cash and cash equivalents (3) 141
1. Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. Current face value of the securities, which
is the remaining principal balance of the underlying mortgages.
2. Current face value. Generally settle within 180 days and include commitments associated with
outright transactions, dollar rolls, and coupon swaps.
3. This amount is included in other Federal Reserve assets in table 1 and in other assets in table 8
and table 9.
4. Information on Principal Accounts of Maiden Lane LLC
Millions of dollars
Account name Wednesday
May 29, 2013
Net portfolio holdings of Maiden Lane LLC (1) 1,424
Outstanding principal amount of loan extended by the Federal Reserve Bank of New York (2) 0
Accrued interest payable to the Federal Reserve Bank of New York (2) 0
Outstanding principal amount and accrued interest on loan payable to JPMorgan Chase & Co. (3) 0
1. Fair value. Fair value reflects an estimate of the price that would be received upon selling an
asset if the transaction were to be conducted in an orderly market on the measurement date. Revalued
quarterly. This table reflects valuations as of March 31, 2013. Any assets purchased after this
valuation date are initially recorded at cost until their estimated fair value as of the purchase date
becomes available.
2. Book value. This amount was eliminated when preparing the Federal Reserve Bank of New York's
statement of condition consistent with consolidation under generally accepted accounting principles. Refer
to the note on consolidation accompanying table 9.
3. Book value. The fair value of these obligations is included in other liabilities and capital in
table 1 and in other liabilities and accrued dividends in table 8 and table 9.
Note: On June 26, 2008, the Federal Reserve Bank of New York (FRBNY) extended credit to Maiden Lane LLC
under the authority of section 13(3) of the Federal Reserve Act. This limited liability company was formed to
acquire certain assets of Bear Stearns and to manage those assets through time to maximize repayment of the credit
extended and to minimize disruption to financial markets. Payments by Maiden Lane LLC from the proceeds of
the net portfolio holdings will be made in the following order: operating expenses of the LLC, principal due to
the FRBNY, interest due to the FRBNY, principal due to JPMorgan Chase & Co., and interest due to JPMorgan
Chase & Co. Any remaining funds will be paid to the FRBNY.
5. Information on Principal Accounts of Maiden Lane II LLC
Millions of dollars
Account name Wednesday
May 29, 2013
Net portfolio holdings of Maiden Lane II LLC (1) 64
Outstanding principal amount of loan extended by the Federal Reserve Bank of New York (2) 0
Accrued interest payable to the Federal Reserve Bank of New York (2) 0
Deferred payment and accrued interest payable to subsidiaries of American International Group, Inc. (3) 0
1. Fair value. Fair value reflects an estimate of the price that would be received upon selling an
asset if the transaction were to be conducted in an orderly market on the measurement date. Revalued
quarterly. This table reflects valuations as of March 31, 2013. Any assets purchased after this
valuation date are initially recorded at cost until their estimated fair value as of the purchase date
becomes available.
2. Book value. This amount was eliminated when preparing the Federal Reserve Bank of New York's
statement of condition consistent with consolidation under generally accepted accounting principles. Refer
to the note on consolidation accompanying table 9.
3. Book value. The deferred payment represents the portion of the proceeds of the net portfolio
holdings due to subsidiaries of American International Group, Inc. in accordance with the asset purchase
agreement. The fair value of this payment and accrued interest payable are included in other
liabilities and capital in table 1 and in other liabilities and accrued dividends in table 8 and table 9.
Note: On December 12, 2008, the Federal Reserve Bank of New York (FRBNY) began extending credit to Maiden
Lane II LLC under the authority of section 13(3) of the Federal Reserve Act. This limited liability company was
formed to purchase residential mortgage-backed securities from the U.S. securities lending reinvestment
portfolio of subsidiaries of American International Group, Inc. (AIG subsidiaries). Payments by Maiden Lane II LLC
from the proceeds of the net portfolio holdings will be made in the following order: operating expenses of
Maiden Lane II LLC, principal due to the FRBNY, interest due to the FRBNY, and deferred payment and interest due
to AIG subsidiaries. Any remaining funds will be shared by the FRBNY and AIG subsidiaries.
6. Information on Principal Accounts of Maiden Lane III LLC
Millions of dollars
Account name Wednesday
May 29, 2013
Net portfolio holdings of Maiden Lane III LLC (1) 22
Outstanding principal amount of loan extended by the Federal Reserve Bank of New York (2) 0
Accrued interest payable to the Federal Reserve Bank of New York (2) 0
Outstanding principal amount and accrued interest on loan payable to American International Group, Inc. (3) 0
1. Fair value. Fair value reflects an estimate of the price that would be received upon selling an
asset if the transaction were to be conducted in an orderly market on the measurement date. Revalued
quarterly. This table reflects valuations as of March 31, 2013. Any assets purchased after this
valuation date are initially recorded at cost until their estimated fair value as of the purchase date
becomes available.
2. Book value. This amount was eliminated when preparing the Federal Reserve Bank of New York's
statement of condition consistent with consolidation under generally accepted accounting principles. Refer
to the note on consolidation accompanying table 9.
3. Book value. The fair value of these obligations is included in other liabilities and capital in
table 1 and in other liabilities and accrued dividends in table 8 and table 9.
Note: On November 25, 2008, the Federal Reserve Bank of New York (FRBNY) began extending credit to Maiden
Lane III LLC under the authority of section 13(3) of the Federal Reserve Act. This limited liability company was
formed to purchase multi-sector collateralized debt obligations (CDOs) on which the Financial Products group
of American International Group, Inc. (AIG) has written credit default swap (CDS) contracts. In connection
with the purchase of CDOs, the CDS counterparties will concurrently unwind the related CDS transactions. Payments
by Maiden Lane III LLC from the proceeds of the net portfolio holdings will be made in the following order:
operating expenses of Maiden Lane III LLC, principal due to the FRBNY, interest due to the FRBNY, principal due
to AIG, and interest due to AIG. Any remaining funds will be shared by the FRBNY and AIG.
7. Information on Principal Accounts of TALF LLC
Millions of dollars
Account name Wednesday
May 29, 2013
Asset-backed securities holdings (1) 0
Other investments, net 388
Net portfolio holdings of TALF LLC 388
Outstanding principal amount of loan extended by the Federal Reserve Bank of New York (2) 0
Accrued interest payable to the Federal Reserve Bank of New York (2) 0
Funding provided by U.S. Treasury to TALF LLC, including accrued interest payable (3) 0
1. Fair value. Fair value reflects an estimate of the price that would be received upon selling an
asset if the transaction were to be conducted in an orderly market on the measurement date.
2. Book value. This amount was eliminated when preparing the Federal Reserve Bank of New York's
statement of condition consistent with consolidation under generally accepted accounting principles. Refer
to the note on consolidation accompanying table 9.
3. Book value. The fair value of these obligations is included in other liabilities and capital in
table 1 and in other liabilities and accrued dividends in table 8 and table 9.
Note: On November 25, 2008, the Federal Reserve announced the creation of the Term Asset-Backed Securities
Loan Facility (TALF) under the authority of section 13(3) of the Federal Reserve Act. The TALF is a facility
under which the Federal Reserve Bank of New York (FRBNY) extends loans with a term of up to five years to
holders of eligible asset-backed securities. The TALF is intended to assist financial markets in accommodating the
credit needs of consumers and businesses by facilitating the issuance of asset-backed securities collateralized
by a variety of consumer and business loans. The loans provided through the TALF to eligible borrowers are
non-recourse, meaning that the obligation of the borrower can be discharged by surrendering the collateral to
the FRBNY. The loans are extended for the market value of the security less an amount known as a haircut. As a
result, the borrower bears the initial risk of a decline in the value of the security.
TALF LLC is a limited liability company formed to purchase and manage any asset-backed securities received
by the FRBNY in connection with the decision of a borrower not to repay a TALF loan. TALF LLC has committed,
for a fee, to purchase all asset-backed securities received by the FRBNY in conjunction with a TALF loan at a
price equal to the TALF loan plus accrued but unpaid interest. Losses on asset-backed securities held by TALF
LLC will be offset in the following order: by the commitment fees collected by TALF LLC then by the interest
received on investments of TALF LLC. Payments by TALF LLC from the proceeds of its net portfolio holdings will be
made in the following order: operating expenses of TALF LLC, principal due to the FRBNY, principal due to the
U.S. Treasury, interest due to the FRBNY, and interest due to the U.S. Treasury. Any remaining funds will be
shared by the FRBNY and the U.S. Treasury.
8. Consolidated Statement of Condition of All Federal Reserve Banks
Millions of dollars
Assets, liabilities, and capital Eliminations Wednesday Change since
from May 29, 2013 Wednesday Wednesday
consolidation May 22, 2013 May 30, 2012
Assets
Gold certificate account 11,037 0 0
Special drawing rights certificate account 5,200 0 0
Coin 1,966 - 35 - 176
Securities, unamortized premiums and discounts,
repurchase agreements, and loans 3,318,900 - 8,887 + 581,992
Securities held outright (1) 3,119,382 - 8,610 + 517,706
U.S. Treasury securities 1,883,559 + 6,405 + 226,884
Bills (2) 0 0 - 18,423
Notes and bonds, nominal (2) 1,789,288 + 6,349 + 228,345
Notes and bonds, inflation-indexed (2) 81,646 0 + 13,992
Inflation compensation (3) 12,624 + 55 + 2,969
Federal agency debt securities (2) 70,890 - 1,163 - 22,362
Mortgage-backed securities (4) 1,164,934 - 13,851 + 313,184
Unamortized premiums on securities held outright
(5) 200,824 - 276 + 68,816
Unamortized discounts on securities held outright
(5) -1,724 - 30 + 562
Repurchase agreements (6) 0 0 0
Loans 418 + 29 - 5,091
Net portfolio holdings of Maiden Lane LLC (7) 1,424 - 5 - 2,454
Net portfolio holdings of Maiden Lane II LLC (8) 64 0 + 45
Net portfolio holdings of Maiden Lane III LLC (9) 22 0 - 15,235
Net portfolio holdings of TALF LLC (10) 388 0 - 453
Items in process of collection (0) 515 + 80 + 273
Bank premises 2,304 + 2 - 65
Central bank liquidity swaps (11) 1,771 - 5,506 - 20,397
Foreign currency denominated assets (12) 23,238 + 321 - 1,887
Other assets (13) 18,299 + 445 + 831
Total assets (0) 3,385,128 - 13,585 + 542,474
Note: Components may not sum to totals because of rounding. Footnotes appear at the end of the table.
8. Consolidated Statement of Condition of All Federal Reserve Banks (continued)
Millions of dollars
Assets, liabilities, and capital Eliminations Wednesday Change since
from May 29, 2013 Wednesday Wednesday
consolidation May 22, 2013 May 30, 2012
Liabilities
Federal Reserve notes, net of F.R. Bank holdings 1,149,335 + 4,079 + 81,185
Reverse repurchase agreements (14) 88,177 + 1,484 - 5,349
Deposits (0) 2,083,333 - 17,903 + 476,016
Term deposits held by depository institutions 10,496 + 10,496 + 7,443
Other deposits held by depository institutions 2,022,589 + 47,411 + 496,501
U.S. Treasury, General Account 14,298 - 10,908 - 53,297
Foreign official 11,024 + 65 + 10,889
Other (0) 24,925 - 64,968 + 14,479
Deferred availability cash items (0) 1,627 + 460 + 293
Other liabilities and accrued dividends (15) 7,451 - 1,706 - 10,218
Total liabilities (0) 3,329,923 - 13,587 + 541,926
Capital accounts
Capital paid in 27,602 0 + 273
Surplus 27,602 0 + 273
Other capital accounts 0 0 0
Total capital 55,205 + 2 + 548
Note: Components may not sum to totals because of rounding.
1. Includes securities lent to dealers under the overnight securities lending facility; refer to table
1A.
2. Face value of the securities.
3. Compensation that adjusts for the effect of inflation on the original face value of
inflation-indexed securities.
4. Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. Current face value of the securities, which
is the remaining principal balance of the underlying mortgages.
5. Reflects the premium or discount, which is the difference between the purchase price and the face
value of the securities that has not been amortized. For U.S. Treasury and Federal agency debt
securities, amortization is on a straight-line basis. For mortgage-backed securities, amortization is on an
effective-interest basis.
6. Cash value of agreements, which are collateralized by U.S. Treasury and federal agency securities.
7. Refer to table 4 and the note on consolidation accompanying table 9.
8. Refer to table 5 and the note on consolidation accompanying table 9.
9. Refer to table 6 and the note on consolidation accompanying table 9.
10. Refer to table 7 and the note on consolidation accompanying table 9.
11. Dollar value of foreign currency held under these agreements valued at the exchange rate to be used
when the foreign currency is returned to the foreign central bank. This exchange rate equals the
market exchange rate used when the foreign currency was acquired from the foreign central bank.
12. Revalued daily at current foreign currency exchange rates.
13. Includes accrued interest, which represents the daily accumulation of interest earned, and other
accounts receivable.
14. Cash value of agreements, which are collateralized by U.S. Treasury securities, federal agency debt
securities, and mortgage-backed securities.
15. Includes the liabilities of Maiden Lane LLC, Maiden Lane II LLC, Maiden Lane III LLC, and TALF LLC
to entities other than the Federal Reserve Bank of New York, including liabilities that have recourse
only to the portfolio holdings of these LLCs. Refer to table 4 through table 7 and the note on
consolidation accompanying table 9. Also includes the liability for interest on Federal Reserve notes due
to U.S. Treasury.
9. Statement of Condition of Each Federal Reserve Bank, May 29, 2013
Millions of dollars
Assets, liabilities, and capital Total Boston New York Philadelphia Cleveland Richmond Atlanta Chicago St. Louis Minneapolis Kansas Dallas San
City Francisco
Assets
Gold certificate account 11,037 391 3,925 397 512 856 1,421 792 310 190 309 728 1,206
Special drawing rights certificate acct. 5,200 196 1,818 210 237 412 654 424 150 90 153 282 574
Coin 1,966 36 92 123 133 347 182 291 25 49 158 191 339
Securities, unamortized premiums and
discounts, repurchase agreements,
and loans 3,318,900 86,777 1,840,556 96,151 84,751 206,346 220,446 179,376 53,404 31,503 62,791 128,867 327,932
Securities held outright (1) 3,119,382 81,569 1,729,825 90,382 79,666 193,966 207,216 168,560 50,192 29,600 59,015 121,133 308,257
U.S. Treasury securities 1,883,559 49,253 1,044,510 54,575 48,104 117,121 125,122 101,781 30,307 17,873 35,635 73,143 186,133
Bills (2) 0 0 0 0 0 0 0 0 0 0 0 0 0
Notes and bonds (3) 1,883,559 49,253 1,044,510 54,575 48,104 117,121 125,122 101,781 30,307 17,873 35,635 73,143 186,133
Federal agency debt securities (2) 70,890 1,854 39,311 2,054 1,810 4,408 4,709 3,831 1,141 673 1,341 2,753 7,005
Mortgage-backed securities (4) 1,164,934 30,462 646,004 33,753 29,751 72,437 77,385 62,949 18,744 11,054 22,039 45,237 115,119
Unamortized premiums on securities held
outright (5) 200,824 5,251 111,365 5,819 5,129 12,487 13,340 10,852 3,231 1,906 3,799 7,798 19,845
Unamortized discounts on securities
held outright (5) -1,724 -45 -956 -50 -44 -107 -115 -93 -28 -16 -33 -67 -170
Repurchase agreements (6) 0 0 0 0 0 0 0 0 0 0 0 0 0
Loans 418 2 321 0 0 0 4 56 9 13 9 2 0
Net portfolio holdings of Maiden
Lane LLC (7) 1,424 0 1,424 0 0 0 0 0 0 0 0 0 0
Net portfolio holdings of Maiden
Lane II LLC (8) 64 0 64 0 0 0 0 0 0 0 0 0 0
Net portfolio holdings of Maiden
Lane III LLC (9) 22 0 22 0 0 0 0 0 0 0 0 0 0
Net portfolio holdings of TALF LLC (10) 388 0 388 0 0 0 0 0 0 0 0 0 0
Items in process of collection 515 0 0 0 0 0 514 0 0 0 0 0 0
Bank premises 2,304 120 432 72 114 229 213 202 129 102 250 236 207
Central bank liquidity swaps (11) 1,771 87 566 137 138 372 101 50 15 7 18 28 251
Foreign currency denominated assets (12) 23,238 1,142 7,431 1,797 1,812 4,879 1,324 663 194 97 235 369 3,296
Other assets (13) 18,299 507 9,645 671 477 1,300 1,227 975 316 229 362 816 1,774
Interdistrict settlement account 0 - 14,291 + 194,909 - 18,132 - 13,772 - 8,165 - 31,731 - 33,084 - 9,733 - 10,425 - 18,788 - 31,094 - 5,693
Total assets 3,385,128 74,964 2,061,272 81,426 74,401 206,577 194,350 149,689 44,809 21,842 45,489 100,423 329,886
Note: Components may not sum to totals because of rounding. Footnotes appear at the end of the table.
9. Statement of Condition of Each Federal Reserve Bank, May 29, 2013 (continued)
Millions of dollars
Assets, liabilities, and capital Total Boston New York Philadelphia Cleveland Richmond Atlanta Chicago St. Louis Minneapolis Kansas Dallas San
City Francisco
Liabilities
Federal Reserve notes outstanding 1,429,218 46,091 549,095 46,076 60,135 107,365 173,141 94,194 36,336 23,246 38,431 99,322 155,784
Less: Notes held by F.R. Banks 279,883 11,982 88,742 6,038 8,601 11,273 31,402 15,657 3,677 9,584 12,362 49,178 31,386
Federal Reserve notes, net 1,149,335 34,109 460,353 40,038 51,534 96,091 141,740 78,538 32,659 13,662 26,069 50,144 124,398
Reverse repurchase agreements (14) 88,177 2,306 48,898 2,555 2,252 5,483 5,858 4,765 1,419 837 1,668 3,424 8,714
Deposits 2,083,333 35,666 1,531,671 34,195 15,927 92,461 41,513 64,387 10,072 6,768 16,995 45,586 188,092
Term deposits held by depository
institutions 10,496 95 6,891 850 0 40 705 255 0 95 210 105 1,250
Other deposits held by depository
institutions 2,022,589 35,538 1,474,818 33,306 15,923 92,279 40,797 64,097 10,072 6,673 16,784 45,476 186,827
U.S. Treasury, General Account 14,298 0 14,298 0 0 0 0 0 0 0 0 0 0
Foreign official 11,024 2 10,997 3 3 8 2 1 0 0 0 1 6
Other 24,925 31 24,667 36 0 134 9 34 0 0 1 4 9
Deferred availability cash items 1,627 0 0 0 0 0 1,452 0 0 175 0 0 0
Interest on Federal Reserve notes due
to U.S. Treasury (15) 1,551 48 782 43 59 142 110 78 23 13 28 56 170
Other liabilities and accrued
dividends (16) 5,900 239 2,039 306 284 734 501 409 172 153 165 295 602
Total liabilities 3,329,923 72,368 2,043,743 77,136 70,055 194,912 191,174 148,176 44,346 21,608 44,925 99,505 321,975
Capital
Capital paid in 27,602 1,298 8,764 2,145 2,173 5,833 1,588 756 232 117 282 459 3,956
Surplus 27,602 1,298 8,764 2,145 2,173 5,833 1,588 756 232 117 282 459 3,956
Other capital 0 0 0 0 0 0 0 0 0 0 0 0 0
Total liabilities and capital 3,385,128 74,964 2,061,272 81,426 74,401 206,577 194,350 149,689 44,809 21,842 45,489 100,423 329,886
Note: Components may not sum to totals because of rounding. Footnotes appear at the end of the table.
9. Statement of Condition of Each Federal Reserve Bank, May 29, 2013 (continued)
1. Includes securities lent to dealers under the overnight securities lending facility; refer to table 1A.
2. Face value of the securities.
3. Includes the original face value of inflation-indexed securities and compensation that adjusts for the effect of inflation on the original face value of such securities.
4. Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. Current face value of the securities, which is the remaining principal balance of the underlying mortgages.
5. Reflects the premium or discount, which is the difference between the purchase price and the face value of the securities that has not been amortized. For U.S. Treasury and Federal agency debt
securities, amortization is on a straight-line basis. For mortgage-backed securities, amortization is on an effective-interest basis.
6. Cash value of agreements, which are collateralized by U.S. Treasury and federal agency securities.
7. Refer to table 4 and the note on consolidation below.
8. Refer to table 5 and the note on consolidation below.
9. Refer to table 6 and the note on consolidation below.
10. Refer to table 7 and the note on consolidation below.
11. Dollar value of foreign currency held under these agreements valued at the exchange rate to be used when the foreign currency is returned to the foreign central bank. This exchange rate equals
the market exchange rate used when the foreign currency was acquired from the foreign central bank.
12. Revalued daily at current foreign currency exchange rates.
13. Includes accrued interest, which represents the daily accumulation of interest earned, and other accounts receivable.
14. Cash value of agreements, which are collateralized by U.S. Treasury securities, federal agency debt securities, and mortgage-backed securities.
15. Represents the estimated weekly remittances to U.S. Treasury as interest on Federal Reserve notes or, in those cases where the Reserve Bank's net earnings are not sufficient to equate surplus to
capital paid-in, the deferred asset for interest on Federal Reserve notes. The amount of any deferred asset, which is presented as a negative amount in this line, represents the amount of the
Federal Reserve Bank's earnings that must be retained before remittances to the U.S. Treasury resume. The amounts on this line are calculated in accordance with Board of Governors policy, which requires
the Federal Reserve Banks to remit residual earnings to the U.S. Treasury as interest on Federal Reserve notes after providing for the costs of operations, payment of dividends, and the amount
necessary to equate surplus with capital paid-in.
16. Includes the liabilities of Maiden Lane LLC, Maiden Lane II LLC, Maiden Lane III LLC, and TALF LLC to entities other than the Federal Reserve Bank of New York, including liabilities that have
recourse only to the portfolio holdings of these LLCs. Refer to table 4 through table 7 and the note on consolidation below.
Note on consolidation:
The Federal Reserve Bank of New York (FRBNY) has extended loans to several limited liability companies under the authority of section 13(3) of the Federal Reserve Act. On June 26, 2008, a
loan was extended to Maiden Lane LLC, which was formed to acquire certain assets of Bear Stearns. On November 25, 2008, a loan was extended to Maiden Lane III LLC, which was formed to purchase
multi-sector collateralized debt obligations on which the Financial Products group of the American International Group, Inc. has written credit default swap contracts. On December 12, 2008, a
loan was extended to Maiden Lane II LLC, which was formed to purchase residential mortgage-backed securities from the U.S. securities lending reinvestment portfolio of subsidiaries of American
International Group, Inc. On November 25, 2008, the Federal Reserve Board authorized the FRBNY to extend credit to TALF LLC, which was formed to purchase and manage any asset-backed securities
received by the FRBNY in connection with the decision of a borrower not to repay a loan extended under the Term Asset-Backed Securities Loan Facility.
The FRBNY is the primary beneficiary of TALF LLC, because of the two beneficiaries of the LLC, the FRBNY and the U.S. Treasury, the FRBNY is primarily responsible for directing the financial
activities of TALF LLC. The FRBNY is the primary beneficiary of the other LLCs cited above because it will receive a majority of any residual returns of the LLCs and absorb a majority of any
residual losses of the LLCs. Consistent with generally accepted accounting principles, the assets and liabilities of these LLCs have been consolidated with the assets and liabilities of the
FRBNY in the preparation of the statements of condition shown on this release. As a consequence of the consolidation, the extensions of credit from the FRBNY to the LLCs are eliminated, the net
assets of the LLCs appear as assets on the previous page (and in table 1 and table 8), and the liabilities of the LLCs to entities other than the FRBNY, including those with recourse only to
the portfolio holdings of the LLCs, are included in other liabilities in this table (and table 1 and table 8).
10. Collateral Held against Federal Reserve Notes: Federal Reserve Agents' Accounts
Millions of dollars
Federal Reserve notes and collateral Wednesday
May 29, 2013
Federal Reserve notes outstanding 1,429,218
Less: Notes held by F.R. Banks not subject to collateralization 279,883
Federal Reserve notes to be collateralized 1,149,335
Collateral held against Federal Reserve notes 1,149,335
Gold certificate account 11,037
Special drawing rights certificate account 5,200
U.S. Treasury, agency debt, and mortgage-backed securities pledged (1,2) 1,133,098
Other assets pledged 0
Memo:
Total U.S. Treasury, agency debt, and mortgage-backed securities (1,2) 3,119,382
Less: Face value of securities under reverse repurchase agreements 78,204
U.S. Treasury, agency debt, and mortgage-backed securities eligible to be pledged 3,041,178
Note: Components may not sum to totals because of rounding.
1. Includes face value of U.S. Treasury, agency debt, and mortgage-backed securities held outright,
compensation to adjust for the effect of inflation on the original face value of inflation-indexed
securities, and cash value of repurchase agreements.
2. Includes securities lent to dealers under the overnight securities lending facility; refer to table
1A.
Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product
[Percent] Seasonally adjusted at annual rates
Last Revised on: May 30, 2013 – Next Release Date June 26, 2013
Line
2011
2012
2013
I
II
III
IV
I
II
III
IV
I
1
Gross domestic product
0.1
2.5
1.3
4.1
2.0
1.3
3.1
0.4
2.4
2
Personal consumption expenditures
3.1
1.0
1.7
2.0
2.4
1.5
1.6
1.8
3.4
3
Goods
5.4
-1.0
1.4
5.4
4.7
0.3
3.6
4.3
4.1
4
Durable goods
7.3
-2.3
5.4
13.9
11.5
-0.2
8.9
13.6
8.2
5
Nondurable goods
4.6
-0.3
-0.4
1.8
1.6
0.6
1.2
0.1
2.2
6
Services
2.0
1.9
1.8
0.3
1.3
2.1
0.6
0.6
3.1
7
Gross private domestic investment
-5.3
12.5
5.9
33.9
6.1
0.7
6.6
1.3
9.0
8
Fixed investment
-1.3
12.4
15.5
10.0
9.8
4.5
0.9
14.0
4.1
9
Nonresidential
-1.3
14.5
19.0
9.5
7.5
3.6
-1.8
13.2
2.2
10
Structures
-28.2
35.2
20.7
11.5
12.9
0.6
0.0
16.7
-3.5
11
Equipment and software
11.1
7.8
18.3
8.8
5.4
4.8
-2.6
11.8
4.6
12
Residential
-1.4
4.1
1.4
12.1
20.5
8.5
13.5
17.6
12.1
13
Change in private inventories
—
—
—
—
—
—
—
—
—
14
Net exports of goods and services
—
—
—
—
—
—
—
—
—
15
Exports
5.7
4.1
6.1
1.4
4.4
5.3
1.9
-2.8
0.8
16
Goods
5.7
3.7
6.2
6.0
4.0
7.0
1.1
-5.0
0.3
17
Services
5.8
5.1
6.1
-8.8
5.2
1.1
4.0
2.5
2.0
18
Imports
4.3
0.1
4.7
4.9
3.1
2.8
-0.6
-4.2
1.9
19
Goods
5.2
-0.7
2.9
6.3
2.0
2.9
-1.2
-3.9
1.1
20
Services
-0.6
4.2
13.8
-1.7
9.0
2.3
2.6
-5.6
5.8
21
Government consumption expenditures and gross investment
-7.0
-0.8
-2.9
-2.2
-3.0
-0.7
3.9
-7.0
-4.9
22
Federal
-10.3
2.8
-4.3
-4.4
-4.2
-0.2
9.5
-14.8
-8.7
23
National defense
-14.3
8.3
2.6
-10.6
-7.1
-0.2
12.9
-22.1
-12.1
24
Nondefense
-1.7
-7.5
-17.4
10.2
1.8
-0.4
3.0
1.7
-2.1
25
State and local
-4.7
-3.2
-2.0
-0.7
-2.2
-1.0
0.3
-1.5
-2.4
Addendum:
26
Gross domestic product, current dollars
2.2
5.2
4.3
4.2
4.2
2.8
5.9
1.3
3.6
Fed’s Advisory Council Admits We’re Screwed
Even more amazing than the admission is how long it took them to figure it out. However the most amazing aspect of all is the lack of reaction. The mainstream media, including the financial media, has completely ignored the warning. It’s as if the report doesn’t even exit. Perhaps it’s part of a psychological defense mechanism whereby any information that casts doubt on the recovery myth, no matter how credible the source, is conveniently ignored.
US ECONOMY GROWS 2 4% IN Q1
U.S. GDP In Q1 Revised Lower As Austerity Measures Bite
Peter Schiff US Economy Living On Borrowed Time..
Peter Schiff predicts another economic crash
EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, THURSDAY, MAY 30, 2013
BEA 13-21
* See the navigation bar at the right side of the news release text for links to data tables,
contact personnel and their telephone numbers, and supplementary materials.
National Income and Product Accounts
Gross Domestic Product, 1st quarter 2013 (second estimate);
Corporate Profits, 1st quarter 2013 (preliminary estimate)
Real gross domestic product -- the output of goods and services produced by labor and property
located in the United States -- increased at an annual rate of 2.4 percent in the first quarter of 2013 (that
is, from the fourth quarter to the first quarter), according to the "second" estimate released by the Bureau
of Economic Analysis. In the fourth quarter, real GDP increased 0.4 percent.
The GDP estimate released today is based on more complete source data than were available for
the "advance" estimate issued last month. In the advance estimate, real GDP increased 2.5 percent.
With the second estimate for the first quarter, increases in private inventory investment, in exports, and
in imports were less than previously estimated, but the general picture of overall economic activity is not
greatly changed (for more information, see "Revisions" on page 4).
BOX.______
Comprehensive Revision of the National Income and Product Accounts
BEA plans to release the results of the 14th comprehensive (or benchmark) revision of the national
income and product accounts (NIPAs) in conjunction with the second quarter 2013 "advance" estimate
on July 31, 2013. More information on the revision is available on BEA’s Web site at
www.bea.gov/gdp-revisions. An article in the March 2013 issue of the Survey of Current Business
discusses the upcoming changes in definitions and presentations, and an article in the May Survey
describes the changes in statistical methods. An article in the September Survey will describe the
estimates in detail. Revised NIPA table stubs and news release stubs will be available in June.
FOOTNOTE.______
Quarterly estimates are expressed at seasonally adjusted annual rates, unless otherwise specified.
Quarter-to-quarter dollar changes are differences between these published estimates. Percent changes are
calculated from unrounded data and are annualized. "Real" estimates are in chained (2005) dollars. Price
indexes are chain-type measures.
This news release is available on BEA's Web site along with the Technical Note
and Highlights related to this release. For information on revisions, see
"Revisions to GDP, GDI, and Their Major Components".
________________
The increase in real GDP in the first quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), private inventory investment, residential fixed investment,
nonresidential fixed investment, and exports that were partly offset by negative contributions from
federal government spending and state and local government spending. Imports, which are a subtraction
in the calculation of GDP, increased.
The acceleration in real GDP in the first quarter primarily reflected an upturn in private
inventory investment, an acceleration in PCE, a smaller decrease in federal government spending, and
an upturn in exports that were partly offset by an upturn in imports and a deceleration in nonresidential
fixed investment.
Motor vehicle output added 0.28 percentage point to the first-quarter change in real GDP after
adding 0.18 percentage point to the fourth-quarter change. Final sales of computers added 0.02
percentage point to the first-quarter change in real GDP after adding 0.10 percentage point to the fourth-
quarter change.
The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 1.2 percent in the first quarter, 0.1 percentage point more than in the advance estimate; this
index increased 1.6 percent in the fourth quarter. Excluding food and energy prices, the price index for
gross domestic purchases increased 1.4 percent in the first quarter, compared with an increase of 1.2
percent in the fourth.
Real personal consumption expenditures increased 3.4 percent in the first quarter, compared with
an increase of 1.8 percent in the fourth. Durable goods increased 8.2 percent, compared with an increase
of 13.6 percent. Nondurable goods increased 2.2 percent, compared with an increase of 0.1 percent.
Services increased 3.1 percent, compared with an increase of 0.6 percent.
Real nonresidential fixed investment increased 2.2 percent in the first quarter, compared with an
increase of 13.2 percent in the fourth. Nonresidential structures decreased 3.5 percent, in contrast to an
increase of 16.7 percent. Equipment and software increased 4.6 percent, compared with an increase of
11.8 percent. Real residential fixed investment increased 12.1 percent, compared with an increase of
17.6 percent.
Real exports of goods and services increased 0.8 percent in the first quarter, in contrast to a
decrease of 2.8 percent in the fourth. Real imports of goods and services increased 1.9 percent, in
contrast to a decrease of 4.2 percent.
Real federal government consumption expenditures and gross investment decreased 8.7 percent
in the first quarter, compared with a decrease of 14.8 percent in the fourth. National defense decreased
12.1 percent, compared with a decrease of 22.1 percent. Nondefense decreased 2.1 percent, in contrast
to an increase of 1.7 percent. Real state and local government consumption expenditures and gross
investment decreased 2.4 percent, compared with a decrease of 1.5 percent.
The change in real private inventories added 0.63 percentage point to the first-quarter change in
real GDP, after subtracting 1.52 percentage points from the fourth-quarter change. Private businesses
increased inventories $38.3 billion in the first quarter, following an increases of $13.3 billion in the
fourth quarter and $60.3 billion in the third.
Real final sales of domestic product -- GDP less change in private inventories -- increased 1.8
percent in the first quarter, compared with an increase of 1.9 percent in the fourth.
Gross domestic purchases
Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 2.5 percent in the first quarter; it was unchanged in the fourth quarter.
Gross national product
Real gross national product -- the goods and services produced by the labor and property
supplied by U.S. residents -- increased 1.5 percent in the first quarter, compared with an increase of 0.9
percent in the fourth. GNP includes, and GDP excludes, net receipts of income from the rest of the
world, which decreased $30.3 billion in the first quarter after increasing $19.2 billion in the fourth; in
the first quarter, receipts decreased $20.8 billion, and payments increased $9.5 billion.
Current-dollar GDP
Current-dollar GDP -- the market value of the nation's output of goods and services -- increased
3.6 percent, or $140.4 billion, in the first quarter to a level of $16,004.5 billion. In the fourth quarter,
current-dollar GDP increased 1.3 percent, or $53.1 billion.
Gross domestic income
Real gross domestic income (GDI), which measures the output of the economy as the costs
incurred and the incomes earned in the production of GDP, increased 2.5 percent in the first quarter,
compared with an increase of 5.5 percent (revised) in the fourth. For a given quarter, the estimates of
GDP and GDI may differ for a variety of reasons, including the incorporation of largely independent
source data. However, over longer time spans, the estimates of GDP and GDI tend to follow similar
patterns of change.
Revisions
The "second" estimate of the third-quarter percent change in GDP is 0.1 percentage point, or
$3.9 billion, less than the advance estimate issued last month, primarily reflecting downward revisions
to private inventory investment, to exports, and to state and local government spending that were partly
offset by a downward revision to imports and an upward revision to personal consumption expenditures.
Advance Estimate Second Estimate
(Percent change from preceding quarter)
Real GDP.......................................... 2.5 2.4
Current-dollar GDP................................ 3.7 3.6
Gross domestic purchases price index.............. 1.1 1.2
Corporate Profits
Profits from current production (corporate profits with inventory valuation and capital
consumption adjustments) decreased $43.8 billion in the first quarter, in contrast to an increase of $45.4
billion in the fourth. Current-production cash flow (net cash flow with inventory valuation adjustment) -
- the internal funds available to corporations for investment -- increased $110.9 billion in the first
quarter, in contrast to a decrease of $89.8 billion in the fourth.
Taxes on corporate income decreased $13.6 billion in the first quarter, compared with a decrease
of $4.4 billion in the fourth. Profits after tax with inventory valuation and capital consumption
adjustments decreased $30.2 billion in the first quarter, in contrast to an increase of $49.8 billion in the
fourth. Dividends decreased $101.7 billion in contrast to an increase of $124.3 billion. The large fourth-
quarter increase reflected accelerated and special dividends paid by corporations at the end of 2012 in
anticipation of changes to individual income tax rates. Current-production undistributed profits
increased $71.4 billion, in contrast to a decrease of $74.3 billion.
Domestic profits of financial corporations decreased $2.0 billion in the first quarter, compared
with a decrease of $3.5 billion in the fourth. Domestic profits of nonfinancial corporations decreased
$8.8 billion in the first quarter, in contrast to an increase of $24.8 billion in the fourth. In the first
quarter, real gross value added of nonfinancial corporations increased, and profits per unit of real value
added decreased. The decrease in unit profits reflected an increase in the unit nonlabor costs incurred by
corporations that was partly offset by a decrease in unit labor costs; unit prices were unchanged.
The rest-of-the-world component of profits decreased $33.0 billion in the first quarter, in contrast
to an increase of $24.1 billion in the fourth. This measure is calculated as (1) receipts by U.S. residents
of earnings from their foreign affiliates plus dividends received by U.S. residents from unaffiliated
foreign corporations minus (2) payments by U.S. affiliates of earnings to their foreign parents plus
dividends paid by U.S. corporations to unaffiliated foreign residents. The first-quarter decrease was
accounted for by a decrease in receipts and an increase in payments.
Profits before tax decreased $49.8 billion in the first quarter, in contrast to an increase of $27.3
billion in the fourth. The before-tax measure of profits does not reflect, as does profits from current
production, the capital consumption and inventory valuation adjustments. These adjustments convert
depreciation of fixed assets and inventory withdrawals reported on a tax-return, historical-cost basis to
the current-cost measures used in the national income and product accounts. The capital consumption
adjustment increased $12.9 billion in the first quarter (from -$199.5 billion to -$186.6 billion), compared
with an increase of $0.5 billion in the fourth. The inventory valuation adjustment decreased $6.9 billion
(from -$9.2 billion to -$16.1 billion), in contrast to an increase of $17.6 billion.
The first-quarter changes in taxes on corporate income and in the capital consumption
adjustment mainly reflect the expiration of bonus depreciation claimed under the American Taxpayer
Relief Act of 2012. For detailed data, see the table "Net Effects of the Tax Acts of 2002, 2003, 2008,
2009, 2010, and 2012 on Selected Measures of Corporate Profits" at
www.bea.gov/national/xls/technote_tax_acts.xls. Profits from current production are not affected
because they do not depend on the depreciation-accounting practices used for federal income tax returns;
rather, they are based on depreciation of fixed assets valued at current cost using consistent depreciation
profiles based on used-asset prices. For more details on the effect of tax act provisions on the capital
consumption adjustment, see FAQ #999 on the BEA Web site, "Why does the capital consumption
adjustment for domestic business decline so much in the first quarter of 2012?".
* * *
BEA's national, international, regional, and industry estimates; the Survey of Current Business;
and BEA news releases are available without charge on BEA's Web site at www.bea.gov. By visiting
the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.
* * *
Next release -- June 26, 2013, at 8:30 A.M. EDT for:
Gross Domestic Product: First Quarter 2013 (Third Estimate)
Corporate Profits: First Quarter (Revised Estimate)
Surprise Manufacturing Downturn Holds Back U.S. Growth: Economy
By Shobhana Chandra
the U.S. unexpectedly shrank in May at the fastest pace in four years, showing slowdowns in business and government spending are holding back the world’s largest economy.
The Institute for Supply Management’s factory index fell to 49, the lowest reading since June 2009, from the prior month’s 50.7, the Tempe, Arizona-based group’s report showed today. Fifty is the dividing line between growth and contraction. The median forecast of 81 economists surveyed by Bloomberg was 51.
Across-the-board federal budget cuts and overseas markets that are struggling to rebound will probably continue to curb manufacturing, which accounts for about 12 percent of the economy. At the same time, demand for automobiles, gains in residential construction and lean inventories may spark a pickup in orders and production in the second half of the year.
“Manufacturing is really stymied by slow corporate spending and government spending cutbacks,” said Guy LeBas, chief fixed-income strategist at Janney Montgomery Scott LLC in Philadelphia, who was the only analyst in the Bloomberg survey to correctly project the drop in the index. “Manufacturing will grow at a modest pace this year” although it “is unlikely to accelerate in coming months,” LeBas said. “This is part of the slower expansion we’ll have in the second quarter.”
Estimates in the Bloomberg survey ranged from 49 to 54.
Stocks fluctuated between gains and losses after the report. The Standard & Poor’s 500 Index fell 0.3 percent to 1,626.19 at 12:39 p.m. in New York. The gauge had posted its first consecutive weekly losses since November.
Manufacturing activity contracted in May for the first time in six months as new orders slipped and there was less demand for exports, an industry report showed on Monday.
The Institute for Supply Management (ISM) said its index of national factory activity in May fell to 49.0 from 50.7 in April, short of expectations for 50.7.
A reading below 50 indicates contraction in the manufacturing sector. The last time the ISM manufacturing index fell below 50 was November 2012, shortly after the U.S. east coast was hit by a massive storm.
The gauge for new orders dropped to 48.8 from 52.3, while a measure of employment edged down to 50.1 from 50.2. Production fell to 48.6 from 53.5.
The exports index fell to 51.0 from 54.0, while imports held up relatively better, slipping slightly to 54.5 from 55.0.
Though growth has cooled in recent months, before May the national reading had managed to stay in expansion territory, unlike some regional reports that have shown shrinkage.
Economic growth overall in the second quarter is expected to slow from the first quarter’s 2.4 percent pace.
Fed’s Advisory Council of bankers warns of risks posed by QE3
A Federal Reserve advisory panel of bankers issued a stark warning to the U.S. central bank earlier this month over the dangers of its massive bond purchases, according to documents released on Friday.
“Current policy has created systemic financial risks and potential structural problems for banks,” the Federal Advisory Council noted, according to minutes of its meeting on May 17, which the Fed posted on its public website.
In February, the council, made up of 12 representatives from the banking industry who meet four times a year, stated that it continued to support the Fed’s accommodative monetary policy.
In May, there was an acknowledgment that the policies had provided support for a slow recovery, but no explicit backing.
“However, the effectiveness of the policies in producing healthy economic and employment growth is not clear. Uncertainty about fiscal and monetary policy is deterring business investment that would spur growth,” the Council noted.
Fed officials say they are mindful of the potential costs of a campaign of their massive bond purchases, aimed at spurring growth by holding down borrowing costs, and have signaled that they may scale back buying if the economy continues to improve over the next few months.
The program, currently running at an $85 billon monthly pace, has harsh critics. The Advisory Council echoed some of these concerns in its May meeting, including a trend of low rates pushing investors into riskier assets to make up for lost yield.
The Advisory Council also noted that the Fed’s campaign of so called quantitative easing, which entered a third stage – dubbed QE3 – in September, has tripled the Fed’s balance sheet to around $3.3 trillion, and could be disruptive to exit.
“Uncertainty exists about how markets will reestablish normal valuations when the Fed withdraws from the market. It will likely be difficult to unwind policy accommodation.”
Each of the Fed’s 12 regional branches chooses a banker from its district to sit on the council, whose members include Joseph Hooley, head of Boston’s State Street Corp ; James Gorman, boss of Morgan Stanley in New York; and Kelly King, head of BB&T Corp in Winston-Salem, North Carolina. (Reporting By Alister Bull; Editing by Nick Zieminski)
Defeat The Gang of 8 Amensty For Illegal Immigation Bill
Gang Of Eight Senators Kill Amendment Requiring Border Fence
Rep. Steve King: Immigration Legislation is ‘Breathtaking, Outrageous Form of Amnesty’
Heritage Foundation Report on the cost of legalizing 11 mn illegal immigrants
Legalizing Illegals Will Cost $6.3 Trillion!
Wood Says Immigration Amnesty to Cost $6.3 Trillion
Schumer Refuses To Estimate Future Immigration Flow Under Gang Of Eight Proposal
Cruz Offers Amendments to ‘Gang of Eight’ Bill
Congressman Steve King leads House opposition to Senate’s Gang of Eight immigration bill
Law Officers Plead With Congress To Hear Their Concerns Over Proposed Amnesty Bill
Sessions: Gang Of Eight Sticking Together To Defeat Improvements To Their Bill
Top ICE Agent: ‘Zero Confidence In This Administration’ To Deliver On Immigration Enforcement
The Gang Of 8′s Opposition Cost $6.3 Trillion – Sessions: 35 million Illegals New Citizen – Dobbs
Sessions: Gang Of Eight Bill Would Surge Low-Skill Immigration, Hurt Working Americans
Sessions: Senate Rushing Immigration Bill Lawmakers Haven’t Read
US. & Mexican Government Working Together To Provide Legal & illegal Aliens Food Stamp – O’Reilly
Border Patrol Official: Illegal Immigrants To Get ‘A Free Pass’ Under President’s New Policy
Sen. Sessions: Senate immigration bill will ‘hammer working Americans’
By Bernie Becker
Sen. Jeff Sessions (R-Ala.) said Friday that the Senate immigration reform bill would “hammer working Americans.”
Sessions, one of the immigration overhaul’s most strident critics, suggested the measure would prioritize foreign-born workers over people already in the U.S. struggling to find a job.
“This is far, far too many low-skilled workers that are going to take jobs and pull down wages of people unemployed and underemployed right now,” Sessions, a senior member of the Senate Judiciary Committee, said on Fox Business. “It’s really, really dangerous.”
The Senate Judiciary panel cleared the immigration bill crafted by the so-called “Gang of Eight” this week by a bipartisan 13-5 vote, and its supporters hope to rack up 70 votes in the chamber.
But Sen. Robert Menendez (D-N.J.), one of the Gang of Eight, said Friday that the vote doesn’t yet have 60 votes in the chamber. Sen. Orrin Hatch (Utah), another senior Republican on the Judiciary panel, voted for the measure in committee, but has said he might not back it on the Senate floor.
Segment 0: The Dirty Dozen aka Soros, Obama, Jarrett, Shulman, Kelley, Hall, Lerner, Paz, Thomas, Seck, IRS Agents: White House–IRS Collectivist Conspiracy Targets Pro Israel, Pro Life, Tea Party and Conservative Movement Groups To Suppress Voter Turnout! — Videos
IRS Subject Matter Expert
Holly Paz
Manager
Exempt Organizations Guidance
Holly is a manager in Exempt Organizations’ Guidance office, which is responsible for drafting notices, announcements, revenue procedures, and other guidance on exempt organization matters. Holly’s work often involves coordination with the Office of Chief Counsel and the Treasury Department on legislative and technical issues, as well as providing information to the tax writing committees of Congress.
Before coming to Exempt Organizations, Holly served as an attorney-advisor in the Taxpayer Advocate Service, an independent organization within the Internal Revenue Service that helps taxpayers resolve problems with the IRS. She also worked for eight years as an attorney in private practice focusing on exempt organizations issues. She earned her juris doctor from the University of Pennsylvania Law School.
The Dirty Dozen Movie Trailer
Dirty Dozen (1967) – General Inspection
Movie of the Week: Dirty Dozen – Lee Marvin Review by Best Movies By Farr
George Soros Exposed – Puppet master Glenn Beck
Obama Admin Evolution Of A Scandal – IRS Enemies List – Hannity
Targeted By The Taxman – He Made Us Do It! RPT: IRS Worker Names ATT”Y Carter Hull
Reality Check: IRS Scandal Exclusive
Heads are starting to roll at the IRS. Ben is following a story that is going in many directions. With many who are distancing themselves. In fact, He first told
you on March 1, 2012 that Tea Party and Liberty Groups in seven states claimed they were being targeted by the IRS: https://www.youtube.com/watch?v=9Sit-….
In this Reality Check compilation, Ben goes in-depth on the IRS vs. Tea Party, Liberty groups, and religious organizations.
The IRS apologized. The white House decries the unacceptable actions and any connection to the current administration.
Ben has tracked the chain of command through the Cincinnati office and is going to show you how this situation transitions into the Washington D.C. office, and possibly beyond.
Obama Admin IRS Scandal & Congress Dealing With Scandals – Krauthammer On O’Reilly
IRS Worker At Center Of Targeting Scandal Gets Promoted -RPT – Cavuto – Wake Up America
Goldberg on IRS Scandal on IRS
Stein on IRS Scandal
IRS – May 6th Letter To Conservative Group Suggest Targeting Is Not Over Cavuto
Tea Party Groups Protests The IRS
The Blaze TV “The IRS Tax Scandal” Matt Kibbe & Adam Brandon 5/29/13
Part II – The Blaze TV “The IRS Tax Scandal” Matt Kibbe & Adam Brandon 5/29/13
Tea Party Groups To Sue IRS Over Targeting Of Conservatives – Megyn Kelly -Wake Up America
Katie Pavlich on Shulman’s 159 Visits to WH – IRS Scandal with Neil Cavuto – Fox Business – 5-30-13
IRS Scandal, How High Does It Go? Catastrophic Failure! – Greta On The Record
FreedomWorks VP: IRS Scandal Just Beginning [The Christian Broadcasting Network]
IRS Scandal – New Information On IRS Chain Of Command – Missing Link Cindy Thomas? – Megyn Kelly
IRS Targeting Scandal Sarah Hall Inram Now Running Obamacare Office & Benghazi Update
Glenn Beck » IRS, ObamaCare, And The White House
You are a conspiracy theorist if you blame Obama
Peakaboo Politics: The IRS Scandal — A Timeline of Confusing Statements
IRS Lois Lerner Pleads The Fifth, Dismissed From Scandal Hearing
IRS 5-22-2013 House Oversight Committee 4
TRIFECTA — Targeting Tea: Obama’s IRS Singles Out Conservative Groups
Mark Levin on Hannity: Obama Said Only Learned About IRS Story on Friday
The IRS and Sarah Hall Ingram
The IRS And ObamaCare
Former IRS Commish Shulman cites Easter Egg Roll for visiting White House 118 times
U.S. Treasury Knew About I.R.S. Partisanship
Why IRS Scandal Could Haunt Obama
FTN: NTEU urges political contributions
Why I Serve: Colleen Kelley, National Treasury Employees Union (NTEU)
Fall of America: G. Edward Griffin on Conspiracy Theories
G. Edward Griffin – The Collectivist Conspiracy
PJTV: Obama IRS Scandal Uncovers the Ugly Side of Income Taxes
IRS scandal: GOP looks to seize election opportunity, CBS News Video 5-30-2013
FreedomWorks On Tap “The IRS Tax Terror” 5-16-13
Another 30 Mins w/ Glenn Beck & Richard Poe @ GBTV Regarding “The ShadowParty” Book, George Soros
Former IRS Chief’s Wife Works for Leftist Campaign Finance Reform Group
On Friday, reports broke that Former IRS chief Doug Shulman’s wife works with a liberal lobbying group, Public Campaign, where she is the senior program advisor. Public Campaign is an “organization dedicated to sweeping campaign reform that aims to dramatically reduce the role of big special interest money in American politics.”
The goal of Public Campaign is to target political groups like the conservative non-profits at issue in the IRS scandal. The Campaign says it “is laying the foundation for reform by working with a broad range of organizations, including local community groups, around the country that are fighting for change and national organizations whose members are not fairly represented under the current campaign finance system.”
CEO of Public Campaign Nick Nyhart has offered words of support for the IRS’ targeting: “There are legitimate questions to be asked about political groups that are hiding behind a 501(c)4 status. It’s unfortunate a few bad apples at the IRS will make it harder for those questions to be asked without claims of bias.”
Public Campaign gets its cash from labor unions like AFL-CIO, AFSCME, SEIU, and Move On.
George Soros Gives $1 Million To Barack Obama Super PAC
The Huffington Post | By Paul Blumenthal
The Democrats heavy-hitters are finally coming out of the dugout to play ball in the brave new world of unlimited contributions and super PACs.
A spokesperson for Priorities USA Action, the super PAC backing President Barack Obama’s reelection, confirmed to The Huffington Post Thursday that billionaire investor George Soros has committed $1 million to the PAC. A spokesman for House Majority PAC also confirmed to HuffPost that Soros had given a combined $500,000 to House Majority PAC and the Senate Majority PAC in September.
The New York Times’ Nick Confessore was first to publish the news about the Soros donations. According to Confessore, Soros’ political adviser Michael Vachon announced the contributions at a meeting of the liberal donor group, Democracy Alliance where former President Bill Clinton, Minority Leader Nancy Pelosi and Sen. Chuck Schumer (D-N.Y.) were urging donors — most of whom have refused until now — to give to super PACs. Aside from the Soros donations, another $10 million was promised by donors attending the meeting.
Confessore writes that Soros, who did not attend the meeting, sent an email to Democracy Alliance members explaining his contributions:
“I fully support the re-election of President Obama,” Mr. Soros said in the email. He had not contributed until now, he wrote, because he opposed the Supreme Court’s Citizens United decision in 2010, which paved the way for super PACs and unlimited money in politics. But since then, Mr. Soros wrote, he had become “appalled by the Romney campaign which is openly soliciting the money of the rich to starve the state of the money it needs to provide social services.”
It’s a sharp contrast to where Soros stood shortly after the 2010 midterm elections, when he expressed criticism of the Obama administration before a group of donors at a private meeting and suggested they pledge their money elsewhere.
Soros already has given $1.275 million to super PACs, the majority of which went to the Democratic opposition research hub American Bridge. His announced contributions this election still come nowhere near the amount that he gave to try to unseat President George W. Bush in 2004. Soros donated more than $30 million in that election — a record sum until international casino billionaire Sheldon Adelson dropped more than $70 million this year into a host of super PACs and non-disclosing non-profits.
George Soros: His Influence on the Media and the IRS Scandal
Soros’ Hand in the IRS Scandal
By Russ Jones
New details regarding the IRS scandal that found the nation’s top tax office intentionally targeting conservative groups are surfacing. Like, for example, the fact that George Soros-funded organizations sent letters encouraging the IRS to investigate conservative organizations.
According to findings reported by the Media Research Center (MRC), Soros gave $6.1 million to liberal groups who urged the Internal Revenue Service to investigate conservative non-profit organizations, including various tea party and Christian groups.
Dan Gainor, vice president of business and culture for MRC, says the scandal could be traced to a series of letters that two liberal groups — Campaign Legal Center (CLC) and Democracy 21 — sent to the IRS in 2010 and 2011 asking for an “investigation” of political consultant Karl Rove’s Crossroads GPS.
“What they need to focus on is this timeline,” Gainor suggests. “We actually carry the timeline here, and the timeline is when these lefty operations sent their letters to the IRS and what the IRS did soon after.”
Pro Publica,The Huffington Post and Mother Jones were just a few of the accomplices that helped instigate IRS investigations. But as of 2010, Pro Publica received a two-year contribution of $125,000 each year from George Soros’ Open Society Foundations.
“It is a who’s who of far-left organizations,” the MRC spokesman offers. “Remember — this is George Soros, who has given $8.5 billion to charity. Of that … that we could track, $550 million has gone to liberal operations here in the United States.”
Applications of nine organizations applying for tax-exempt status that had yet to be approved were sent to Pro Publica. Unapproved applications are not supposed to be made public.
Soros Gave $6.1 Million to Groups Linked to Pressure on IRS to Target Conservative Nonprofits
By Mike Ciandella (CNS News), May 15, 2013 •
As IRS efforts targeting politically-conservative groups gained momentum, George Soros-funded liberal groups repeatedly called on the IRS to investigate conservative nonprofit organizations.
While the first reported instances of extra IRS scrutiny for conservative groups began in Cincinnati in March of 2010, the attacks began to pick up steam on a national level soon after Soros-funded groups began firing off letters to the IRS in October of that year – following the Supreme Court’s Citizens United ruling.
The talking points of these groups then bounced around a carefully created progressive “echo chamber,” until they eventually made their way into established media outlets. Key IRS policy changes about how it investigated conservative groups took place soon after it received three separate letters sent by Soros-funded liberal organizations.
Several Soros-funded groups including the Campaign Legal Center, Democracy 21, the Center for Public Integrity, Mother Jones and Alternet have worked to pressure the IRS to target conservative nonprofit groups. The subsequent IRS investigation flagged more than 100 tea party-related applications for higher scrutiny, including applications that included the words “Tea Party” and “patriot.”
The IRS scandal can be traced back to a series of letters that the liberal groups Campaign Legal Center (CLC) and Democracy 21 sent to the IRS back in 2010 and 2011. Both groups were funded by George’s Soros’s Open Society Foundations. The CLC received $677,000 and Democracy 21 got $365,000 from the Soros-backed foundation, according to the Foundation’s 990 tax forms.
The letters specifically targeted conservative Super PACs like Karl Rove’s Crossroads GPS, asking the IRS to scrutinize them more thoroughly to determine whether or not they should retain their tax-exempt status.
On Oct. 5, 2010, when the first letter was sent to the IRS, calling specifically for the agency to “investigate” Crossroads GPS. The letter claimed Crossroads was “impermissibly using its tax status to spend tens of millions of dollars in the 2010 congressional races while hiding the donors funding these expenditures from the American people.” Democracy 21 President Fred Wertheimer wrote a blog post for the liberal Huffington Post to promote it, and the effort to get the media to notice the anti-conservative campaign began.
On June 27, 2011, a second letter by the CLC and Democracy 21 complained about enforcement of 501(c)(4) tax regulations, asking “that the IRS issue new regulations that better enforce the law.” Two days later, an IRS senior agency official was briefed on a new policy targeting groups which “criticize how the country is being run,” according to a Washington Post story. According to the Post, this policy was later revised.
A third letter by the CLC and Democracy 21, on Sept 28, 2011, got media traction. The letter showed the escalation of the left’s complaint about 501(c)(4) groups. It challenged “the eligibility of four organizations engaged in campaign activity to be treated as 501(c)(4) tax exempt organizations.” The four organizations included Crossroads GPS, Priorities USA, American Action Network and Americans Elect.
The Soros-funded Center for Public Integrity ($2,716,328) published a “study” on 501(c)(4) groups, on October 31, which drew heavily from, and referenced, the CLC and Democracy 21. The Center for Public Integrity has strong media connections and boasts an advisory board that includes Ben Sherwood, president of ABC News, and Michele Norris, an NPR host, as well as a board of directors with such prominent names as Huffington Post CEO Arianna Huffington, Steve Kroft of CBS News’s 60 Minutes and Craig Newmark (founder of Craigslist).
This study then led to a Mother Jones article about a month later, on November 18, which was reposted on the left-wing blog Alternet on November 21. By December of 2011, the topic had been picked up in a New York Times editorial, and then began receiving other media coverage. That editorial called for “the Internal Revenue Service to crack down on the secret political money already flooding the 2012 campaign from partisan operatives ludicrously claiming to be ‘social welfare’ activists.”
On Jan. 15, 2012, the IRS targeted groups focused on limiting government or educating people about the Constitution and Bill of Rights
Alternet and Mother Jones are both members of The Media Consortium, which is designed to do exactly what happened here. The Media Consortium was created to be a progressive “echo chamber,” where 63 separate left-wing media outlets can network and share ideas, as well as cross-promote stories. Other members of the Consortium include such liberal outlets as The Nation,Democracy Now! and The American Prospect. The consortium has also received $675,000 in Soros funds since 2000. Alternet ($285,000) and Mother Jones ($485,000) have both also received individual funding from Soros’s Open Society Foundations.
This isn’t the only time the IRS has targeted conservative groups recently, nor is it the only connection between the IRS and Soros-funded groups. The IRS gave the left-wing journalism site ProPublica the applications for nine conservative groups pending tax-exempt status.
The IRS also released the confidential donor lists of the National Organization for Marriage to the liberal Human Rights Campaign. Both the Human Rights Campaign ($2,716,328) and ProPublica ($300,000) are also Soros-funded. Despite its blatant liberal leanings, ProPublica boasts a staff of well-known journalists, including veterans of The New York Times and The Wall Street journal, as well as of liberal operations like the Center for American Progress and The Nation, and has even won two Pulitzer Prizes.
Timeline Shows Influence of Soros-Funded Groups:
March 1-17, 2010: First ten reported cases of targeting by the IRS against groups that had ties to the “tea party or similar organizations.”
Sept. 16, 2010: TIME article “The New GOP Money Stampede” quotes Wertheimer;
Sept. 23, 2010: DISCLOSE act, a campaign finance disclosure act specifically targeting a Tea Party group, in the writing of which the CLC participated, fails in the Senate;
Sept. 28, 2010: Democrat Senator Max Baucus writes a letter to the IRS, citing the TIME article;
Oct. 5, 2010: Democracy 21 and Campaign Legal Center petition IRS, Wertheimer writes HuffPo article;
Oct. 7, 2010: Legal brief from HoltzmanVogel PLLC against the Democracy 21 petition;
Oct. 14, 2010: Dick Durbin asks IRS to investigate American Crossroads, HuffPo coverage;
June 27, 2011: Second petition to the IRS by CLC and Democracy 21;
June 29, 2011: IRS senior agency official Lois Lerner briefed on efforts to target groups which “criticize how the country is being run”;
Sept. 28, 2011: CLC and Democracy 21 petition IRS again, this time about four conservative groups;
Oct. 31, 2011: CPI “investigation”;
Nov. 18, 2011: Mother Jones article;
Nov. 21, 2011: Alternet repost of Mother Jones Article;
Dec. 29, 2011: New York Times oped;
Jan. 15, 2012: IRS targeted groups focusing on limiting government or educating on the Constitution and Bill of Rights;
February 2012: First articles promoting this issue appear in New York Times, Washington Post and LA Times.
IRS Chain of Command Suggests Scandal Not Limited to ‘Low-Level Employees’
By MARK HEMINGWAY
After the IRS revealed it had wrongly targeted hundreds of conservative and Tea Party groups, the agency claimed that the misconduct was limited to “low-level employees” in its Cincinnati office. Yesterday, the attorney for Lois Lerner, the head of the IRS’s tax-exempt organizations division, told the House Oversight Committee she would invoke her Fifth Amendment rights, making that explanation much less credible.
Now the local Cincinnati Fox affiliate, FOX19, has done some digging and uncovered information suggesting that top officials at the IRS weren’t too far removed from the six low-level employees identified as making unjustified inquiries. Fox19 has not only identified all six IRS agents in question, it turns out that they all have only one supervisor in common:
When an application for tax exempt status comes into the IRS, agents have 270 days to work through that application. If the application is not processed within those 270 days it automatically triggers flags in the system. When that happens, individual agents are required to input a status update on that individual case once a month, every month until the case is resolved. …
So who in the chain of command would have received all these flags? The answer, according to the IRS directory, one woman in Cincinnati, Cindy Thomas, the Program Manager of the Tax Exempt Division. Because all six of our IRS workers have different individual and territory managers, Cindy Thomas is one manager they all have common.
Cindy Thomas’s name is significant, because Thomas is the woman who leaked nine tax documents to the journalism outlet ProPublica last year. The leaking of pending tax documents is a clear violation of the law. After having uncovered the nature of Thomas’s involvement, FOX19 looks at her place in the IRS chain of command:
Former Acting IRS Commissioner Steven Miller… retires
Joseph Grant, Commissioner of Tax Exempt and Government Entities… retires.
Lois Lerner, Head of Exempt Organization…says she will invoke her 5th amendment right to not incriminate herself when called before Congress on Wednesday.
Holly Paz, Director of Exempt Organizations, subpoenaed to Washington to be interviewed by members of Congress.
All of this IRS leadership, in Washington D.C.
Then one level down is Cindy Thomas, the highest ranking employee in Cincinnati in this Tax Exempt and Government Entities Department that no one in Congress is talking to… yet.
Scandal Watch: New evidence makes it clear that the Internal Revenue Service campaign against conservatives wasn’t the result of two “rogue” agents, but was directed from higher up. The question is, how high up?
The claim that a couple of workers in the bowels of an IRS office in Cincinnati managed to block tax-exempt applications from conservative groups for more than two years, while subjecting them to outrageous, intrusive and improper requests for information, started falling apart days ago.
Last weekend, the Washington Post quoted a staffer saying that “everything comes from the top” at the IRS.
As Colleen Kelley, president of the union that represents IRS agents, told the Associated Press, “No processes or procedures or anything like that would ever be done just by frontline employees without any management involvement.”
And the New York Times reported that IRS accountants got a “directive from their manager” in early 2010 to “be on the lookout” for Tea Party-type groups.
This week, NBC News quoted a former manager of that Cincinnati office who explained how various internal checks and balances would have prevented workers from carrying out such a scheme on their own.
And Cincinnati’s Fox 19 News, which has done more solid reporting on this story than most of the major news outlets, looks to have put the final nail in the “rogue agent” story.
The local news station found that there were six agents — not two as former IRS head Steven Miller insisted just last week — who worked on these tax-exempt applications. These agents, Fox 19 learned, all had different direct managers, who in turn had different territory managers.
That means any directive applying to all these workers would had to have come from at least three levels up the management chain.
That manager turns out to be Cindy Thomas — who the IRS says oversees “exempt organization determinations” nationwide. She also happens to be the same person who ProPublica said signed off on releasing nine confidential tax-exempt applications from conservative groups to that liberal-leaning news website.
So if Thomas ordered the targeting, why? And if someone told her to get it done, who was that?
Fox 19 also learned all these managers would have known that Tea Party applications were being blocked long ago. IRS agents must handle tax-exempt applications within 270 days, after which the system automatically sends out an alert, making the agent provide a status update each month until the case is resolved.
Since the IRS started blocking Tea Party-type applications in April 2010 and didn’t approve a single one for more than two years, “thousands of red flags would have been generated.” Given the 270-day schedule, the first alerts would have hit back in December 2010.
Given all this, it’s not surprising that one top IRS official is now pleading the Fifth, and that the IRS is stonewalling congressional requests for communications relating to the targeting, including crucial emails.
Every new tidbit of information only makes the scandal look worse.
Yesterday I asked in this space, among other questions about the IRS scandal, this:
What was the subject of the Obama-Kelley March 31, 2010 meeting?
I received the following response to my question from the National Treasury Employees Union (NTEU) — the union for IRS employees headed by ex-14 year agent Colleen Kelley. The response came from union spokesperson Dina Long. It reads, in its entirety, this:
Statement of NTEU
On March 31, 2010, NTEU President Colleen M. Kelley attended the White House Forum on Workplace Flexibility at the Old Executive Office Building. The forum was attended by approximately 200 attendees including business leaders, workers, policy experts and labor representatives discussing telework and worklife balance issues. Attendees were broken into five groups to discuss workplace issues. The president made opening remarks. President Kelley did not have any direct contact with the president or the first lady. President Kelley has never discussed the tea party with the president.
Below is a description of the March 2010 forum from the White House web site:
On March 31, 2010, President Barack Obama, First Lady Michelle Obama and the White House Council on Women and Girls hosted the White House Forum on Workplace Flexibility. The Forum brought together small business owners, corporate leaders, workers, policy experts, and labor leaders to explore the importance of creating workplace practices that allow America’s working men and women to meet the demands of their jobs without sacrificing the needs of their families. Building on the momentum coming out of that forum, the Administration is hosting follow-up forums around the country and encourages others to convene events in their communities to engage in dialogue and take action on this important issue.”
Sounds reasonable, yes?
Read again. Let’s see how the Washington game is played.
Over here, in a story by the Daily Caller’s Caroline May, the NTEU responded to Ms. May with the exact same statement that was sent to me.
With one difference. This interesting sentence:
President Kelley has never discussed the tea party with the president.
The folks over at the Daily Caller, Tucker Carlson’s site, are no dummies. If that sentence had been included in the otherwise identical response they received from the NTEU, they would have reported it.
So why was that one particular sentence tacked on to the otherwise identical statement from the NTEU? In a response to me?
Because in fact it is an answer — a disturbingly partial answer — to but one question of eight questions that I asked of Ms. Kelley. Let me share with you the exact email I sent to the NTEU for Colleen Kelley:
US News reports today the March 31, 2010 meeting mentioned in the article was a ” ‘Workplace Flexibility Forum,’ a March 2010 event that was about the state of flexible work arrangements.” I realize there are a number of questions here, but under the circumstances of this IRS controversy I want to make sure that Ms. Kelley has the opportunity to answer. I will be happy to publish her answers verbatim in The American Spectator.
Thanks,
Jeff Lord
The American Spectator
US News mentions that it has received no comment from Ms. Kelley. I would like to get a response from Ms. Kelley to the following questions:
• Did the President himself ever, at any time, discuss the Tea Party with Ms. Kelley?
• Did the President ever communicate his thoughts on the Tea Party to Kelley – in any fashion other than a face-to-face conversation such as e-mail, text or by phone?
• Was the Tea Party or any other group opposing the President’s agenda discussed at the March 31st meeting, or before or after that meeting?
• Will Ms. Kelley be asking the White House to release any e-mails, text or phone records that detail Kelley’s contacts with not only Mr. Obama but his staff? Will Ms. Kelley release any of these communications that are in the files of NTEU?
• Will Ms. Kelley ask the IRS to release all e-mail, text or phone records between Kelley or any other leader of the NTEU with IRS employees? With the Oversight Board? IRS employees are federal employees paid with taxpayer dollars.
• Has Ms. Kelley ever been given access to IRS records of Tea Party cases? Has she ever discussed the Tea Party or any conservative organization with IRS employees at any level?
• What did Ms. Kelley discuss with the President or any White House or government official at the December 3, 2009 White House Christmas Party that she attended?
• What role did Executive Order 13522 play in the IRS investigations of the Tea Party and all these other conservative groups?
That would be eight questions for “President Kelley,” as she was called in the NTEU response.
The very first question was:
Did the President himself ever, at any time, discuss the Tea Party with Ms. Kelley?
To which the NTEU responded by simply tacking on the following single sentence to their boilerplate reply to the media:
President Kelley has never discussed the tea party with the president.
But the rest of it? The answers to questions two through eight?
Silence.
Silence from the official NTEU spokesperson Dina Long. Silence from Colleen Kelley herself.
There was no “I’ll get back to you further.” There was no “Give us some time, what’s your deadline?” There was just….silence.
Note as well that when contacted by the Washington Post last week, the NTEU’s Kelley was, in the words of the Post headline, “mum.” Wrote the Post:
So far, the National Treasury Employees Union, which generally is not shy with public comment, has next to nothing to say about that or anything else.
NTEU is working to get the facts but does not have any specifics at this time. Moreover, IRS employees are not permitted to discuss taxpayer cases. We cannot comment further at this time,” NTEU President Colleen M. Kelley said via e-mail.
A call to the NTEU office in Cincinnati resulted in a similar response: “We’ve been directed by national office. We have no comment.”
So what do we have here?
This.
A powerful labor union — the union that represents IRS employees — is displaying a pattern of refusing to answer questions. Other than the solitary statement to The American Spectator that “President Kelley has never discussed the tea party with the president.”
Beyond a generic, boilerplate answer to media inquiries, there is silence.
No answers about releasing union e-mails or phone records to or from the White House, the IRS or the IRS Oversight Board (on which board sits a former NTEU president) and no answers on all the rest.
But over here at the Washington Post, we have, buried in a story about the Cincinnati office of the IRS, this key phrase:
“Everything comes from the top. We don’t have any authority to make those decisions without someone signing off on them. There has to be a directive.”
Got that?
“Everything comes from the top.”
The top is where Colleen Kelley, the head of all those unionized IRS workers in Cincinnati, operates.
The top is the White House, the IRS offices in Washington, D.C., and the IRS Oversight Board.
The top is what makes it possible for the IRS union to have the run of the IRS, to get an Executive Order (# 13522) from the President to “allow employee and unions to have pre-decisional involvement in all workplace matters….”
The top is where Colleen Kelley goes to a White House Christmas party as the guest of President and Mrs. Obama — six days before that Executive Order 13522 is issued.
The top is where Colleen Kelley can be the head of the IRS union that gets its dues, its very survival money, from employees being paid by taxpayer dollars — and not have to answer questions about the details of her “collaboration” with the White House, the Obama-run IRS and the IRS Oversight Board.
And being at the top is what gives Ms. Kelley the belief that she can head an IRS public employees union — and do the old Nixon stonewall.
She isn’t the only one at the top busy stonewalling right now.
And as with Watergate, the place to get to the bottom of the top is Congress.
Where a new version of an old question should be asked:
What did the IRS union president know — and when did she know it?
“My question is who is going to jail?” — House Speaker John Boehner on the IRS Scandal
The President couldn’t even bring himself to breathe a word of the truth.
He could fire some hapless Acting Commissioner, but last night Mr. Obama never came close to discussing that which must never be discussed.
The IRS?
It’s about a union: the National Treasury Employees Union. The NTEU. A left-wing union representing 150,000 employees in 31 separate government agencies, including the IRS. A union that not only endorsed President Obama for election and re-election, but a union whose current president, Colleen Kelly, was a 14-year IRS agent and now is both union president and Obama administration appointee (of which more in a moment).
It’s about 94% of NTEU union contributions going to Democrats in the Senate and House in 2012 — candidates who campaigned as vociferous opponents of the Tea Party.
And the recently released report from the Treasury Inspector General? You will not find a single reference to the NTEU. Whose members are both player and referee in the exploding controversy over the IRS targeting of conservative groups.
Which raises the obvious question: how many NTEU members were involved in the writing of the Inspector General’s report?
Even more to the point, what contact — what coordination — has the Obama White House had with their allies in the NTEU leadership as both the White House and the NTEU race to get on top of a scandal that is rapidly engulfing both?
Did I mention that the NTEU has no comment on all of this? And that when President Obama went in front of cameras to make his statement on the IRS scandal — he never once mentioned his very powerful union buddies that have the run of the IRS? Right down to the control of who gets a Blackberry? Literally.
Let’s first see how the IRS/NTEU game with the Tea Party and conservatives is played, shall we?
In the 2012 election cycle, the IRS union gave its money this way:
For the U.S. Senate: Total to Democrats: $156,750 Total to Republicans: $1,000
For the U.S. House: Total to Democrats: $391,062 Total to Republicans: $23,000
And the candidates on the receiving end of those IRS employee dollars? Yes indeed. They were candidates who were running flat out against the Tea Party, depicting Tea Party-supported candidates as dangerous, extremists, and crazies. Exhibiting exactly the anti-Tea Party antipathy on the campaign trail that has been revealed to be permeating the IRS.
No wonder. These Senate and House races were fueled in part by money donated by IRS employees.
Let’s take a look at specific races where the IRS employee money was involved.
• Wisconsin: One of those IRS employee-backed Senate candidates was Democrat Tammy Baldwin of Wisconsin, who in fact won her Senate race over ex-Republican Governor Tommy Thompson.
The NTEU, the union representing IRS employees, gave Baldwin $8,500. And what was Baldwin’s view of the Tea Party? If you check over here at the Midwest Values PAC, a left-wing political action committee set up by liberal Senator Al Franken of Minnesota, you will find this headline:
National Memo: Tammy Baldwin Runs Straight At The Tea Party
The story begins this way, and I have put the key sentence in bold print:
Wisconsin Democratic Rep. Tammy Baldwin wants to be the first openly gay candidate elected to the United States Senate. In an exclusive interview with The National Memo over the weekend, she made clear how she means to go about doing it: running straight at the Tea Party.
• Indiana: In the Indiana Senate race, the Democrats’ candidate was Joe Donnelly, who used his $5,000 contribution to run a winning anti-Tea Party race against Republican Richard Mourdock. Donnelly’s campaign website, presumably financed in part with the money contributed by IRS employees, has this headline attacking the Tea Party:
FACT CHECK: Mourdock Trying to Change Subject from Extreme TEA Party Views
The text of the Donnelly press release begins this way, with a direct attack on the Tea Party:
Indianapolis, Ind.—Today, Joe Donnelly’s campaign responded to Richard Mourdock’s latest ad trying to change the subject from his pattern of extreme TEA Party views.
“Hoosier voters are rejecting Richard Mourdock’s pattern of TEA Party extreme positions, so he is desperate to change the subject,” said Paul Tencher, campaign manager. “In fact, Indiana voters are responding to Joe’s message of working with both parties to get things done for middle class families. The only person playing politics in this race is Mr. Mourdock, as he tries to distract voters from his extreme views that are out of the mainstream.”
• Missouri: Over in the Missouri Senate race between Democrat Claire McCaskill and Republican Todd Akin, the IRS employee money — in the form of a $10,000 contribution to McCaskill — was used by the McCaskill campaign to help send this e-mail to supporters that bluntly attacked the Tea Party as “dangerous”:
Akin’s Rap Sheet Makes It Clear: Tea Party Congressman’s Outside Of The Mainstream Views, Dangerous Policies Are Wrong for Missouri, From his record to his rhetoric, everything about Todd Akin’s Tea Party policies are outside of the mainstream and dangerous for Missouri families.
When Missouri Republicans nominated him last night, they pinned their Senate hopes on a far right, Tea Party Congressman whose candidacy diminishes the party’s prospects for November.
And over in House races? At the very top of the high dollar list were two vividly anti-Tea Party candidates who each received a $10,000 contribution of IRS employee dollars.
• House Minority Leader Nancy Pelosi: Pelosi’s strategy was made plain in this interview with liberal columnist Eleanor Clift of the Daily Beast:
Stung by the debt-deal loss, the minority leader plans to get Democrats back on their jobs message and hammer Tea Party lawmakers as extremists who want to destroy government.
• House Minority Whip Steny Hoyer: Hoyer famously attacked the Tea Party this way, as seen with this headline:
Hoyer: Tea Party People Come From Unhappy Families
“There are a whole lot of people in the Tea Party that I see in these polls who don’t want any compromise.My presumption is they have unhappy families.”
Understanding all of this — that IRS employees themselves are paying, through their union the NTEU, for the election of anti-Tea Party candidates — the absence of any mention whatsoever of the connection between the IRS and the NTEU puts the IG report in a very different light.
For example.
The IG report says — and I will bold print the key phrases — the following:
The IRS used inappropriate criteria that identified for review Tea Party and other organizations applying for tax-exempt status based upon their names or policy positions instead of indications of potential political campaign intervention. Ineffective management: 1) allowed inappropriate criteria to be developed and stay in place for more than 18 months, 2) resulted in substantial delays in processing certain applications, and 3) allowed unnecessary potentially involving information requests to be issued.
Although the processing of some applications with potential significant political campaign
intervention was started soon after receipt, no work was completed on the majority of these
applications for 13 months. This was due to delays in receiving assistance from the Exempt Organizations function Headquarters office. For the 296 total political campaign intervention applications TIGTA reviewed as of December 17, 2012, 108 had been approved, 28 were withdrawn by the applicant, none had been denied, and 160 were open from 206 to1,138 calendar days (some for more than three years and crossing two election cycles).
More than 20 months after the initial case was identified, processing the cases began in earnest. ….IRS officials stated that any donor information received in response to a request from its Determinations Unit was later destroyed.
Just in these opening statements of the IG report there is one very significant and glaring omission.
Where is the NTEU?
Note the phrases in bold print:
“The IRS”
“identified for review Tea Party and other organizations”
“Ineffective management”
“the processing”
“delays in receiving assistance from”
“approved”
“IRS officials stated”
“request from its Determinations Unit”
In each and every case these phrases identify actions taken by people — by IRS employees. IRS employees are members of the NTEU. The NTEU that is using money from these very same IRS employees to fund the campaigns of anti-Tea Party candidates like Baldwin, Donnelly, McCaskill, Pelosi and Hoyer. Not to mention all the rest of the Democrats who got a piece of the IRS employee money action.
As one would suspect, given the enormous clout of the liberal IRS union, it’s all about the politics. Liberal politics and the financing of the liberal welfare state. A federal version, if you will, of the recent famous struggle between Wisconsin Governor Scott Walker and state employee unions.
How powerful is the NTEU within the IRS?
Look no further than this IG report from back in January of this year that discusses the role the union has inside the IRS bureaucracy in the minutia of which IRS employees get to carry a Blackberry. The report notes:
In June 2010, the IRS and the NTEU signed an agreement to standardize IRS policy regarding which IRS employees would be allowed (referred to as a “profiled” position in the agreement) to receive certain information technology equipment, including aircards and BlackBerry® smartphones.
Notice: the NTEU, which gave 94% of its campaign money to anti-Tea Party candidates, has the clout within the IRS to demand a say in who can and cannot carry a Blackberry and receive other high tech communications equipment. The report goes on to say:
Initially, IRS policy limited the assignment of BlackBerry® smartphones to executives and senior/departmental managers. However, the agreement between the IRS and the NTEU expanded availability to employees below the executive and senior/departmental level.
This doesn’t even mention the power the NTEU has inside the IRS to decide everything from promotion rules to size of employee workspaces and on and on.
So the obvious.
If you are working in the IRS, and you are an NTEU member, and you know your union leadership is funneling your union dues to anti-Tea Party candidates, and your union has so much raw power within the IRS that they even control whether you, an IRS employee, can get even such mundane tech gear as a Blackberry — what attitude are you going to display as you review Tea Party applications that must, by law, come in to the IRS for approval?
You already know what to do. And inside the IRS, that’s exactly what was done. The Tea Party, in the vernacular, was screwed. By IRS bureaucrats whose union money is being used to attack the Tea Party. Of course these IRS employees know what to do — most probably without even being asked. There is no need to ask. And if they don’t follow the union program — and want a Blackberry — tough luck.
And what of the NTEU president, Ms. Kelly? The one-time IRS agent also doubles as an Obama appointee (announced here by the Obama White House) to the Federal Salary Council. Identified in the Washington Post as:
…a panel obscure to most Washingtonians but one that performs a vital role in recommending raises for most federal employees.
Got that? The President of the NTEU — a union that has gone out of its way to use IRS employee money to defeat the Tea Party — has a “vital role in recommending raises for most federal employees” — which includes, of course, IRS employees.
As if IRS employees don’t have enough incentive to go after the Tea Party, their anti-Tea Party president has a say in whether they get not just a Blackberry but a raise as well.
Can you say: “conflict of interest”?
Let’s stop here and take a look at a famous incident with the IRS that has made news in the last few days: the Articles of Impeachment filed against President Richard Nixon.
By now, all manner of people have been reminded that President Nixon’s resignation was prompted by the House Judiciary Committee passing Articles of Impeachment, with Article 2, Section One specifically saying:
He has, acting personally and through his subordinates and agents, endeavored to obtain from the Internal Revenue Service, in violation of the constitutional rights of citizens, confidential information contained in income tax returns for purposed not authorized by law, and to cause, in violation of the constitutional rights of citizens, income tax audits or other income tax investigations to be initiated or conducted in a discriminatory manner.
But there’s something missing in this recall of the tale of Nixon and the IRS.
In the early 1970s, President Nixon bypassed Congress and postponed salary increases for General Schedule federal employees. This included, of course, the IRS. The NTEU was furious with Nixon and took the President to court in a case called NTEU v. Nixon. The union won, and the federal government was forced to pay $533 million in back pay to federal employees.
So far, so normal in the world of Washington and relationships between a president and federal employees. Right?
Wrong.
Two years later, in 1974, the year the Watergate scandal reached high tide and Nixon was forced to resign, his abuse of the IRS cited in Article 2 as one of the reasons, there was another story out there involving the IRS and Richard Nixon.
As the liberal drive to get Nixon increased to the force of a political hurricane, reporter Jack White of Rhode Island’s Providence Journal-Evening Bulletin received an illegal leak — from the IRS. Specifically, an illegal leak from someone inside the IRS — an IRS employee — that leaked Richard Nixon’s 1970 and 1971 taxes. There was an immediate uproar — not about the leak or the identity of the leaker — but over the accusation that Nixon had underpaid his taxes. The House Judiciary Committee took the information and ran with it, opening an entire line of inquiry about Nixon’s tax deductions. So public was this it resulted in Nixon famously answering a question at a press conference this way:
People have got to know whether or not their President is a crook. Well, I’m not a crook. I’ve earned everything I’ve got.
And while people are remembering Nixon in the current furor over the IRS because of his own abuse of the IRS and Article 2, there was another Article —Article 4 — that was based on the leaked information from the still-unknown IRS employee to reporter Jack White. Read Article 4:
He knowingly and fraudulently failed to report certain income and claimed deductions in the year 1969, 1970, 1971, and 1972 on his Federal income tax returns which were not authorized by law, including deductions for a gift of papers to the United States valued at approximately $576,000.
Nixon vigorously disputed this, of course. But it didn’t matter. He was out the door, forced to resign. A leak from the IRS to the media about Nixon’s taxes one big no-never-mind.
And what happened to reporter Jack White? The man who received the illegal leak of Nixon’s tax returns — a violation of law — and published them?
Jack White was rewarded by his liberal media peers with the 1974 Pulitzer Prize in Journalism for National Reporting.
So.
What’s really going on with the IRS?
The Internal Revenue Service , with all of its mighty taxing and police powers, is in the hands of anti-Tea Party, anti-conservative, political activists. Liberal political activists from the NTEU masquerading as neutral career bureaucrats. The money of IRS employees used to fuel the National Treasury Employees Union’s open and expensive assault on the Tea Party and conservatives.
And comment on all this from the NTEU? Here’s this from the Washington Post:
So far, the National Treasury Employees Union, which generally is not shy with public comment, has next to nothing to say about that or anything else.
“NTEU is working to get the facts but does not have any specifics at this time. Moreover, IRS employees are not permitted to discuss taxpayer cases. We cannot comment further at this time,” NTEU President Colleen M. Kelley said via e-mail.
A call to the NTEU office in Cincinnati resulted in a similar response: “We’ve been directed by national office. We have no comment.”
No comment? No wonder.
“IRS employees are not permitted to discuss taxpayer cases”??!! What a joke.
Here in the Wall Street Journal is author James Bovard with a short history of the political manipulation of the IRS by various presidents, and Bovard notes that: “With the current IRS scandal, we may have seen only the tip of the iceberg.”
Aside from Nixon they include FDR, JFK, and Bill Clinton. The difference is the latter three weren’t forced to resign because of it — and Clinton’s abuse of the IRS was not include in the Articles of Impeachment that focused on his lying to a grand jury over that liberal favorite — sexual harassment.
The real question now?
With the IRS assuming serious police powers of Obamacare, in effect the members of one left-wing labor union will have access to the private health care records of every single American.
And notes the Wall Street Journal, again the bold print for emphasis:
This March the IRS Inspector General reiterated that ObamaCare’s 47 major changes to the revenue code “represent the largest set of tax law changes the IRS has had to implement in more than 20 years.” Thus the IRS is playing Thelma to the Health and Human Service Department’s Louise. The tax agency has requested funding for 1,954 full-time equivalent employees for its Affordable Care Act office in 2014.
Got that? The real meaning here is that the NTEU is asking for 1,954 more union members whose union dues will be put to use to “hammer the Tea Party” in the words of Nancy Pelosi.
As James Taranto also noted over in the Wall Street Journal yesterday:
The Internal Revenue Service last year supplied a left-leaning nonprofit charity with confidential information about conservative organizations, which the charity disseminated to the public, ProPublica reported yesterday.
Once again, IRS employees — they of the anti-Tea Party union NTEU — were caught leaking private information.
Did I mention they were targeting Billy Graham — 95 year old Billy Graham??!!! Why? Because the Billy Graham Evangelistic Association was urging “voters to back ‘candidates who base their decisions on biblical principles….’”
You know what terrifies every liberal in America right now? You want to know the real reason President Obama abruptly felt the need to go on national television last night and fire the Acting Commissioner of the IRS last night as Americans were having their dinner?
The distinct possibility that the IRS and the whole confection of Big Government liberalism built around the federal taxing power is about to implode in scandal.
Big scandal. The kind of scandal that will make Watergate look like a piker.
And the irony?
That in seeking to destroy the credibility of the Tea Party, the Obama administration and its allies have destroyed not just the credibility of the IRS and one very seriously powerful union.
IRS’s Shulman had more public White House visits than any Cabinet member
Publicly released records show that embattled former IRS Commissioner Douglas Shulman visited the White House at least 157 times during the Obama administration, more recorded visits than even the most trusted members of the president’s Cabinet.
Obama officials who’ve visited the White House (As prepared by The Daily Caller)
Shulman’s extensive access to the White House first came to light during his testimony last week before the House Oversight and Government Reform Committee. Shulman gave assorted answers when asked why he had visited the White House 118 times during the period that the IRS was targeting tea party and conservative nonprofits for extra scrutiny and delays on their tax-exempt applications.
By contrast, Shulman’s predecessor Mark Everson only visited the White House once during four years of service in the George W. Bush administration and compared the IRS’s remoteness from the president to “Siberia.” But the scope of Shulman’s White House visits — which strongly suggests coordination by White House officials in the campaign against the president’s political opponents — is even more striking in comparison to the publicly recorded access of Cabinet members.
An analysis by The Daily Caller of the White House’s public “visitor access records” showed that every current and former member of President Obama’s Cabinet would have had to rack up at least 60 more public visits to the president’s home to catch up with “Douglas Shulman.”
The visitor logs do not give a complete picture of White House access. Some high-level officials get cleared for access and do not have to sign in during visits. A Washington Post database of visitor log records cautions, “The log may include some scheduled visits that did not take place and exclude visits by members of Congress, top officials and others who are not required to sign in at security gates.”
The White House press office declined to comment on which visits by high-ranking officials do and do not get recorded in the visitor log, but it is probable that the vast majority of visits by major Cabinet members do not end up in the public record.
Nevertheless, many visits by current and former Cabinet members are in the logs, and the record depicts an IRS chief uniquely at home in the White House.
Attorney General Eric Holder, President Obama’s friend and loyal lieutenant, logged 62 publicly known White House visits, not even half as many as Shulman’s 157.
Former Treasury Secretary Tim Geithner, to whom Shulman reported, clocked in at just 48 publicly known visits.
Former Secretary of State Hillary Clinton earned a cool 43 public visits, and current Secretary of State John Kerry logged 49 known White House visits in the same timeframe, when he was still a U.S. senator.
Shulman has more recorded visits to the White House than HHS Secretary Kathleen Sebelius (48), DHS Secretary Janet Napolitano (34), Education Secretary Arne Duncan (31), former Energy Secretary Steven Chu (22) and former Defense Secretary Robert Gates (17) combined.
The Daily Caller’s analysis includes current, former and presently-nominated members of Obama’s Cabinet.
After Shulman, Acting Secretary of Commerce Rebecca Blank (86), Asst. Attorney General Thomas Perez (83) and Penny Pritzker (76) — Obama’s nominee for Commerce Secretary — have the most publicly known White House visits.
Pro-Israel groups felt wrath of Obama IRS, WFB investigation reveals
BY: Alana Goodman
A Washington Free Beacon investigation has identified at least five pro-Israel organizations that have been audited by the IRS in the wake of a coordinated campaign by White House-allied activist groups in 2009 and 2010.
These organizations, some of which are too afraid of government reprisals to speak publicly, say in interviews with the Free Beacon thatthey now believe the IRS actions may have been coordinated by the Obama administration.
Many of the charities openly clashed with the Obama administration’s policy of opposing Israeli settlement construction over the so-called “Green Line,” which marks the pre-1967 boundary between Israel and the West Bank and West and East Jerusalem.
After the Obama administration took up the Israeli-Palestinian peace process as one of its most prominent foreign policy priorities in early 2009, and made a cessation of Israeli settlement construction the cornerstone of its approach, the nonprofits were subjected to a string of unflattering media reports.
White House-allied lobbying groups joined the media criticism by challenged the nonprofits’ tax-exempt status, arguing that they undercut President Barack Obama’s Middle East policies.
“Our concern at that time was that these articles weren’t just appearing by happenstance, but may have reflected an evolving policy shift in the Obama administration to scrutinize charitable giving by organizations on behalf of Jewish communities and institutions over the Green Line,” said Jerusalem-based attorney Marc Zell, who convened a private meeting of pro-Israel groups in August 2009 to discuss these concerns.
Tax-exempt charities that support Israeli settlements have been the subject of controversy for years. But the issue came to a head after Obama made opposition to settlement construction a focus of his Middle East policy in 2009 and demanded Israeli Prime Minister Bibi Netanyahu halt all construction beyond the Green Line, including in the Israeli capital of Jerusalem.
While it is not illegal for these charities to contribute to groups and individuals across the Green Line, critics say that they should not receive tax-exempt status because they support communities the administration views as antagonistic to administration policy.
The media scrutiny began as early as March 26, 2009, when the Washington Post’s David Ignatius published a column questioning the groups’ tax-exempt status.
The American-Arab Anti-Discrimination Committee (ADC) announced the next day that it would begin a campaign of filing legal complaints with the IRS and the Treasury Department to investigate groups “allegedly raising funds for the development of illegal settlements in the occupied West Bank.”
ADC is closely tied to the Obama White House. The president recorded a video greeting to the group’s annual conference and sent two senior administration officials to attend.
The ADC announced in October 2009 that it had expanded its legal campaign against pro-Israel charities and was “working with a number of coalition partners, both nationally and internationally, in conducting this ongoing campaign.”
The chief negotiator for the Palestinian Authority raised the issue two days later during a meeting with U.S. Consul General Daniel Rubenstein, according to a State Department cable revealed by Wikileaks.
“[Palestinian negotiator Ahmad Quraya] gave the Consul General a copy of an article by Uri Blau and Nir Hasson, published in Israeli daily Haaretz newspaper on August 17, entitled ‘American Non-profit Organization Raises Funds for Settlement,’ and asked the USG to review the situation with an eye toward eliminating organizations’ tax exempt status if they are funding settlement activity,” said the cable.
On July 5, 2010, the New York Times published its 5,000-word cover story on the groups, following up with a Room for Debate series two days later. The article quoted an unnamed senior State Department administration official calling such groups “a problem” and “unhelpful to the efforts that we’re trying to make.” The story also quoted a senior Obama Middle East adviser, Daniel Kurtzer, saying the groups “drove us crazy.”
J Street, a pro-Palestinian lobbying group that was closely aligned with the White House in 2009 and 2010, called the following week for an investigation into U.S. charities that contribute to settlements.
One pro-Israel targets was HaYovel, which was featured prominently in the New York Times article. Six months after the article was published, the IRS audited the Nashville-based charity, which sends volunteers to work in vineyards across the Green Line.
“We bookend that [New York Times] story. We were the first [group mentioned]. They really kind of focused on us,” said HaYovel’s founder Tommy Waller. “Then six months later we had an audit.”
Shari Waller, who cofounded HaYovel with her husband, said the couple received a phone call from the IRS in December 2010. She said she was not aware of anything in their tax documents that may have prompted the audit, and added that the additional scrutiny came during the group’s first five years of existence when audits tend to be rare.
“They contacted us the week of Christmas and told us they wanted to audit us, right now,” she said. “The most unusual thing to me was they contacted us at a time [that] for most people is a very hectic time, and we had just returned from Israel. To think about taking calls for an audit on the telephone—official business is usually conducted through the mail.”
Tommy Waller said he found the timing of the audit “suspicious” and believes it may have been politically motivated.
“We 100-percent support Judea and Samaria, and Jewish sovereignty in that area, and the current administration is 100 percent opposed to Jewish sovereignty in that area of Israel,” he said. “That’s why we suspected that we would have to deal with [an audit].”
Two other organizations—the American arm of an educational institution that operates across the Green Line and the American arm of a well-known Israeli charity that was mentioned in the New York Times article—say they were also audited.
Another organization that was criticized in multiple articles during 2009 and 2010 was audited last year. The organization, like many of the groups with whom the Free Beacon spoke, asked to remain anonymous out of fear of political retaliation and concern that exposure would harm fundraising efforts.
“The IRS carried out an examination of our organization, reviewing all of our accounting records, tax returns, bylaws, bank records, grant awards, etc, for the relevant period,” said a senior official of this organization.
“There was no vindictiveness in the audit itself and it was completed within a matter of months. Our feeling at the time was that this order must have come from above. The IRS seemed to be responding to a request or a complaint from higher up.”
Concerns that the IRS was targeting pro-Israel groups were first raised publicly by Z Street, a pro-Israel organization run by Lori Lowenthal Marcus.
Z Street filed a lawsuit against the IRS in 2010, alleging its application for tax-exempt status was delayed because it disagreed with the Obama administration’s Israel policy.
According to the suit, Marcus’s attorney was informed by IRS official Diane Gentry that Z Street’s “application for tax-exempt status has been at least delayed, and may be denied because of a special IRS policy in place regarding organizations in any way connected with Israel, and further that the applications of many such Israel-related organizations have been assigned to “a special unit in the D.C. office.”
Neither the IRS nor Gentry responded to a request for comment.
Marcus said Z Street has not funded anyone or any groups in the settlements. But, she added, the problems her organization faced could be related to the administration’s concerns over settlement-supporting groups.
Z Street’s application for tax-exempt status first ran into trouble with the IRS on July 19, 2010, two weeks after the lengthy New York Times article was published.
“Even if that is the case, that’s an explanation, but it’s not an answer. It’s not an adequate reason,” said Marcus. “It’s totally inappropriate.”
Zell told the Free Beacon he has not personally witnessed a shift in IRS policy since the 2009 meeting suggesting settlement-supporting nonprofits have been targeted.
However, he said it is a “yellow flag” that at least five of these organizations have been audited since 2009, considering the recent finding by the IRS inspector general that the agency targeted conservative groups.
“Now with the revelations of the IRS abuses vis-a-vis U.S. right-wing organizations, that have been published of late, there is renewed concerned that these kinds of policies, same kinds of policies and procedures, may have been targeted at these organizations [that support settlements],” he said.
Valerie B. Jarrett is a Senior Advisor to President Barack Obama. She oversees the Offices of Public Engagement and Intergovernmental Affairs and chairs the White House Council on Women and Girls.
Prior to joining the Obama Administration, she was the Chief Executive Officer of The Habitat Company. She also served as Co-Chair of the Obama-Biden Presidential Transition Team, and Senior Advisor to Obama’s presidential campaign.
Ms. Jarrett has held positions in both the public and private sector, including the Chairman of the Chicago Transit Board, the Commissioner of Planning and Development for the City of Chicago, and Deputy Chief of Staff for Mayor Richard M. Daley. She also practiced law with two private law firms.
Jarrett also served as a director of corporate and not for profit boards, including Chairman of the Board of the Chicago Stock Exchange, Director of the Federal Reserve Bank of Chicago, and Chairman of the University of Chicago Medical Center Board of Trustees.
Jarrett received her B.A. from Stanford University in 1978 and her J.D. from the University of Michigan Law School in 1981.
Holly Paz
