HP and The Privacy Erosion

[posted on corp-focus, September 29, 2006]

HP and The Privacy Erosion

By Russell Mokhiber and Robert Weissman

It’s hard not to be mesmerized by the bubbling scandal at Hewlett-Packard.

Former chair of the board Patricia Dunn had the company hire private detectives to track down who on the company’s board was leaking information. Those detectives used “pretexting” — employing a false identity — to obtain board member phone records, as well as those of journalists covering the company. They also sifted through garbage and considered sending undercover agents into newsrooms. In the wake of the scandal, Dunn and other executives have resigned, and criminal investigations are underway.

While the Senate was busy yesterday shredding the Constitution, a subcommittee of the House of Representatives focused its attention on HP. Dunn faced a withering examination. Ten witnesses asserted their Fifth Amendment right to refuse to answer questions.

It would be wrong to say this was a waste of the committee’s time. The HP tactics were outrageous, and high-profile cases can properly focus Congressional minds on important issues.

In the wake of the HP scandal, Congress may well pass legislation outlawing pretexting. This is not a trivial issue. The Electronic Privacy Information Center (EPIC) has earlier petitioned the Federal Trade Commission and Federal Communications Commission to take remedial action to stop pretexting. EPIC said in an FTC filing that it had identified 40 websites offering to sell phone records to anyone.

However, in a world where privacy rights are fast slipping away, there’s a lot more that lawmakers should be looking at than pretexting. Digitalization, corporate consolidation, corporate marketers’ effort to microtarget potential customers and the expanding demands of the national security state are combining to enable the creation of a Big Brother corporate-state nexus.

A few examples:

– Phone companies handed over millions of customers’ records to the National Security Agency, without being presented with a warrant. “The actions of Hewlett Packard executives, although egregious, pale in comparison to the violation of the privacy rights of tens of millions of American consumers that should be safeguarded by federal law,” noted 40 organizations including the ACLU, the American Library Association, the Arab American Institute, EPIC, Greenpeace and the Republican Liberty Caucus, in a letter sent yesterday to the House Commerce Committee. “The history of covert government surveillance of citizens,” the groups noted, “has included unjustified spying on civil rights, civil liberty, and peace organizations engaged in First Amendment protected activity.”

– Thanks to the financial services deregulation bill, giant financial conglomerates are now able to share consumer information between affiliates, and they can even share the information with non-affiliated corporations (unless a consumer affirmatively opts out of such arrangements).

– Corporate (and governmental) database managers don’t provide adequate security for their own databases. Stolen computers, misplaced disks and lost files make vast troves of personal data potential available to identity thieves — and those at risk may not even be notified that the data theft has occurred, nor given rights to block access to their consumer credit files. According to the Privacy Rights Clearinghouse, just since February 2005, more than 93 million data records in the United States have been compromised due to security breaches.

– The first corporations are now requiring employees to have RFID chips –- mini radio transmitter chips — embedded in their bodies. The theory is they work as a perfect identity card in high-security situations. The worry is that they may give employers the ability to track employees wherever they go, at any time.

Finally, there is the phenomenon that Robert Harrow chronicles in his chilling book, No Place to Hide: While there are restrictions on the kinds of information U.S. government agencies may collect on citizens, they are increasingly circumventing these restrictions simply by purchasing data collected by corporations such as ChoicePoint, and many others.

“More than ever before,” Harrow concludes, “The details about our lives are no longer our own. They belong to the companies that collect them, and the government agencies that buy or demand them in the name of keeping us safe.”

It’s like our lives are being recorded, one activist told Harrow, with an array of corporations maintaining electronic diaries relating to virtually everything we do.

“Only we have no control over the diaries,” Harrow writes, “and we can’t even know what they say about us. And there’s no place to hide.”

It doesn’t have to be this way. But it will be, unless people demand restraints on how corporations manage the bits and bytes that record who we are and what we do.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter, . Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, . Mokhiber and Weissman are co-authors of On the Rampage: Corporate Predators and the Destruction of Democracy (Monroe, Maine: Common Courage Press).

(c) Russell Mokhiber and Robert Weissman

Elmo Will Not Absolve You

[posted on corp-focus, September 27, 2006]

Elmo Will Not Absolve You

By Russell Mokhiber and Robert Weissman

Just returned from a run around the National Mall.

Party tents are going up.

Getting ready for the National Book Festival on Saturday.

Hosted by the Library of Congress.

Sponsored by Target and AT&T.

And starring Laura Bush.

You will be seeing a lot of Laura Bush in the next couple of days.

Talking with authors.


Hanging out with kids.

It’s just a nice cover for the killing.

We wanted to know more about the National Book Festival.

So, we went to the Library of Congress web site.

And we registered in the press area.

And we got a call back from —

Susie Schoenberger.

She’s not with the Library of Congress.

She’s with the public relations firm — Fleishman Hillard.

Since when is the Library of Congress outsourcing press duties?

Anyway, we want to know — whose paying for this?

How much is Target putting up?

How much is AT&T?

Can’t answer that, Schoenberger says.

You’ll have to speak with Sheryl Cannady.

She’s with the Library of Congress.

So, we call Cannady.

And she sends us an e-mail saying that the one-day National Book Festival costs $1.5 million.

But we can’t tell you who pays for it.


In any event, you get the message.

The web site is the Library of Congress.

But the book festival itself is a corporate/Laura Bush affair.

And no doubt the 70 authors who will appear at the book festival are wonderful people — people like Kai Bird, Douglas Brinkley and Andrew Carroll — and on the whole a book festival is a much better deal for the country than a military festival.

But we also have little doubt that the corporate funding — and Laura Bush’s presence — helped define the types of authors who appear at the Festival.

Please don’t tell us that it’s just about getting kids to read.

The question is not only reading — but reading what?

So, this year there has been a slew of books written about the war in Iraq and corporate power and the military-industrial complex that President Eisenhower warned us against.

But the authors of these books will not appear at the National Book Festival on the Mall sponsored by Target and AT&T — and hosted by Mrs. Laura Bush.

Will Cindy Sheehan appear to read from her new book — Peace Mom?


Will Elizabeth Holtzman appear to read from her new book — The Impeachment of George W. Bush?


Will Thom Hartmann appear to read from Screwed: The Undeclared War Against the Middle Class?


Will Diane Wilson appear to read from her new book — An Unreasonable Woman?

No. (She’d probably be unreasonable enough to confront our First Lady of Bloodshed.)

Will Edwin Black appear to read from his new book — Internal Combustion: How Corporations and Governments Addicted the World to Oil and Derailed The Alternatives?


Will Dr. Helen Caldicott appear to read from her new book — Nuclear Power is Not the Answer?


Will Noam Chomsky appear to read from his bestseller — Hegemony or Survival: America’s Quest for Global Domination?


Will Amy and David Goodman appear to read from their new book — Static: Government Liars, Media Cheerleaders, and the People Who Fight Back?


Will Jeff Goodell appear to read from his new book Big Coal: The Dirty Secret Behind America’s Energy Future?


Will David Callahan appear to read from The Moral Center: How We Can Reclaim Our Country from Die-Hard Extremists, Rogue Corporations, Hollywood Hacks and Pretend Patriots?


Will Gore Vidal appear to read from Imperial America: Reflections on the United States of Amnesia?


Will Stephen Kinzer appear to read from his most recent book, Overthrow: America’s Century of Regime Change from Hawaii to Iraq, or from his previous classic — All the Shah’s Men: An American Coup and the Roots of Middle East Terror?


Will David Cortright appear to read from his masterful Gandhi And Beyond: Nonviolence for an Age of Terrorism?


You get the idea.

The National Book Festival is a public/private partnership — read — corporate controlled.

And therefore, none of these authors will appear.

Laura Bush will appear with kids and NBA players and community relations representatives from Target.

She’ll spend time with the Kevin Clash, an African-American man who is the voice of Elmo, and who has written a book titled My Life As a Furry Red Monster.

Meanwhile, open today’s Washington Post and go to pages A16 to A19.

See the faces of the fallen.

2,693 Americans dead in Iraq.

So far.

Hanging out with Elmo will not absolve you, Mrs. Laura Bush.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter, . Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, . Mokhiber and Weissman are co-authors of On the Rampage: Corporate Predators and the Destruction of Democracy (Monroe, Maine: Common Courage Press).

(c) Russell Mokhiber and Robert Weissman

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The Corporate Subsidiary Ruse

A remarkable story in today’s New York Times reports on a campaign contribution scheme innovated by the insurance giant AIG. Under New York law, corporations are permitted to give up to $5,000 to a candidate. AIG skirted this limitation by having over a dozen of its subsidiaries make contributions — drawn from the same bank account, using sequential checks.

AIG acknowledges that the parent company directed the subsidiaries to act, but the practice may well be legal under New York law, the Times reports, so long as the contributions are allocated to the balance sheets of the subsidiaries.

This is, plainly, yet another argument for public financing of public elections, and a reminder of how important public financing arrangements are at all levels of government.

It should also be a reminder of how the legal rules that govern how corporations are structured help enable corporations to dominate their human creators.

In the AIG case, the parent company explicitly gets it both ways: it is able to direct the subsidiaries, and also able to treat the subs’ actions as independent for the purpose of measuring compliance with campaign finance laws.

Abuse of the corporate form is commonplace. Corporations routinely use parent-subsidiary relationships to avoid taxes (as Enron did to an extreme, and as drug giant GlaxoSmithKline has allegedly done to avoid paying billions in U.S. taxes) and to escape liability in lawsuits (as Philip Morris and BAT are scheming to do in the U.S. litigation against them, and as many multinationals have sought to do to avoid responsibility for their overseas activities).

This is a problem deeply engrained in our legal and regulatory systems, and in our consciousness of what is possible when it comes to controlling corporations. Fixing the problem won’t be easy (though admittedly the AIG case calls for a simple fix), but that doesn’t mean it isn’t necessary, or can’t be done.