Will the US election matter to the IT sector?

Only slightly if at all

Analysis Comparing the candidates, President George W. Bush and Senator John Kerry, in terms of their likely impact on the IT sector, is difficult. Bush has no relevant legislative record to speak of, and Kerry no relevant administrative one.

We have a known administrator in Bush, and a known legislator in Kerry, competing for the same administrative job. It's obviously a good deal easier to predict the impact of another Bush presidency on the IT sector; but inescapable ambiguity has never stopped The Register from taking a stab at things, so let's proceed.

Surveillance and control

The Bush Administration has shown reasonable restraint in most areas of tech regulation, with certain, notable exceptions. First, since 9/11, the Bushies have grown surveillance and wiretap happy, demanding increasing access to private data sources and electronic communications, with decreasing judicial oversight. It has pushed laws like the CALEA, Patriot Act, FISA, and DMCA to the hilt.

The FCC has ruled that VoIP must be made wiretap-friendly, but the administration is not offering any of the financial support that Congress allocated to other communications providers to ease CALEA compliance in the past. This is the sort of regulatory burden on a developing technology that Republicans claim to abhor, but rarely do in fact. If the rule becomes final, it will favor big, well-heeled communications outfits over smaller ones, and thwart competition in the growing VoIP field.

The Bush Administration has encouraged numerous data mining schemes, such as the controversial CAPPS-II system, and its replacement, "Secure Flight". There is also DARPA's dreaded Total Information Awareness system, remnants of which are secretly being pursued even today, and a state-level database scheme ominously called the MATRIX, funded in part by the Administration, through the FBI.

It can be argued that such schemes are good for the small segment of the IT ecosystem that's poised to exploit them and win government contracts, but in general they make it difficult for most tech outfits to assure their customers and business partners of privacy, confidentiality, and security in transactions and communications. And they impose an expensive burden on telecomms and ISPs, essentially deputizing them at considerable inconvenience and expense, and dictating what they may and may not do with their own property.

Would a Kerry Administration be better? As a Senator, John Kerry has been contradictory on privacy and surveillance. He's never been a fan of the private use of strong encryption, and has flirted with such loathsome ideas as key escrow. He has voted to ease government wiretap restrictions, but he has also voted to prohibit recording phone conversations without consent, unless as part of a criminal investigation (although that bill failed).

He voted for the Patriot Act, as everyone had to do in the immediate aftermath of 9/11, but has since criticized it publicly, and is sponsoring legislation to ease some of its more draconian elements. During his speech at the Democratic National Convention, he vowed to "implement all of the recommendations of the 9/11 Commission." One hopes that this was a slip of the tongue, and that he meant to say that he would implement all of the Commission's sensible recommendations, but this is not clear.

Given Kerry's voting record in the Senate, and a number of his campaign pronouncements on national security, homeland defense, and counterterrorism, a Kerry Administration might well be as nosey and authoritarian as the Bushies have been.

Guns, guns, guns Bush's military spending has been nothing short of incontinent. This is important, because many tech outfits are major defense contractors that are enjoying quite a windfall these days. While it may seem that the pork banquet will never end, it is clearly not sustainable at current levels of taxation. Bush will have to raise taxes or cut spending, although he won't be talking about either sacrilege until after the election.

Kerry says he intends to raise taxes on the very rich, but he also promises increased social and homeland defense spending. Like Bush, he's a bit vague on how he intends to pay for all the wonderful things he's promising, but it's hard to imagine Kerry succeeding without easing the military budget. The tech sector might to lose a bit on defense sales during a Kerry Administration, but should gain at least as much in domestic pork programs, assuming that Kerry follows through on his promise to boost homeland security, and assuming that Congress decides to cooperate with him.

One should not expect much real difference between the two administrations on defense and homeland security. They have somewhat different priorities, but the reality of what needs to be spent and done militarily to prevent Iraq from descending into civil war and anarchy won't change according to either candidate's preferences. Uncontrollable external realities are going to have a major impact on Washington policy for the foreseeable future, regardless of who occupies the Oval Office.

Currently, opinion polls suggest that the public prefers Bush to Kerry by a narrow margin, but it also wants significant changes in the direction the country is headed. The fiction that war in Iraq has enhanced US security has finally worn thin. And Congress is far from pleased, with even Republican members expressing doubts in public.

Meanwhile, Bush's options have been falling away with incredible speed since he cakewalked smugly into Iraq, and the quality of his few remaining options has been deteriorating just as fast. But this cuts both ways; Kerry will be unable to escape the consequences of Bush's blunders. Either candidate could end up a lame duck, buckling under overwhelming pressures from Iraq, from an impatient Congress, and from an increasingly skeptical populace.

Ecommerce, fun, and sex

The Internet is, if nothing else, the greatest porn delivery mechanism ever conceived, and Bush's Cromwellian Attorney General, John Ashcroft, has got this very profitable industry in his crosshairs. Ashcroft fully intends to prosecute online porn purveyors under the obscenity laws, and is seeking severe penalties. A second term for Bush will only embolden him further.

His current test case is against Rob Zicari and Janet Romano of Extreme Associates, an outfit that specializes in heavy-duty porn. After being found not guilty according to the defendants' local community standards, the pair came under fire from Ashcroft for distributing porn to other communities via the Internet. The US is prosecuting them in Pennsylvania, where 'community standards' are likely to be less tolerant. The defendants face up to 50 years in prison if convicted on all counts. If Ashcroft succeeds in getting a severe sentence in this case, it will undoubtedly send a chilling message to others in the online porn trade. And the precedent of allowing DoJ to prosecute Internet obscenity cases in the jurisdiction of its choice will lead to scores of other criminal cases.

The FCC, under Republican Chairman Michael Powell, went on the prudery warpath over the recent, and putatively accidental, momentary exposure of Janet Jackson's breast on national television. Powell and company fined CBS, which had the misfortune of broadcasting the incident, an incredible $550,000. The message is clear: 'indecency' is a serious matter to this Administration, even when it takes the form of a momentary gaffe, and the entertainment, broadcasting, and communications industries had better start erring on the side of overcautious self-censorship.

But would a Kerry Administration be any better? Kerry has voted to ban Internet gambling, and voted in favor of mandatory Internet filtering in schools and libraries.

He voted for the Communications Decency Act, which the US Supreme Court later ruled unconstitutional. He later supported legislation to exempt from the Internet tax moratorium any online business that offers content deemed 'harmful to minors,' so that they might be targeted with punitive tax audits. This amendment later merged with House legislation to morph into the Child's Online Protection Act (COPA), which the US Supreme Court has since ruled unconstitutional.

So Kerry has positioned himself as an opponent of free expression and online fun. He clearly has a prudish streak, although it pales in comparison with Bush Administration fanaticism.

Kerry has been a longtime opponent of taxes for both ecommerce and Net access, but so is Bush. He's been a friend of copy protection, but there again, so is Bush. Kerry voted for the DMCA, and would likely sustain the Ashcroft policy of using the FBI to enforce piracy and copyright laws.

He voted for an industry-friendly measure to increase the number of H-1B visas from 115,000 to 195,000. He voted against an industry-friendly measure shielding tech companies from lawsuits related to the Y2K bug, which Republicans supported.

Tech jobs

Kerry has spoken loudly against outsourcing jobs, which often means outsourcing tech jobs. But he is not proposing a direct regulatory approach to the issue. He would deal with it by closing certain tax loopholes allowing US companies to defer tax payments on foreign subsidiaries. The idea is to discourage outsourcing by making foreign operations a bit more expensive.

This might not necessarily be a bad thing - if it works, that is. No one likes to hear about costs rising, but creating more, and better, jobs at home can serve as an economic stimulant by creating more consumers with greater disposable incomes, hence more demand for products and services, and better profit margins. Outsourcing does lighten labor costs, certainly, but sometimes it literally takes money to make money. The problem with outsourcing is that low-wage workers overseas will not be buying American. It's actually an autolytic process.

Bush's strategy is mere denial embroidered with fatuities. The economy "is strong and is getting stronger," he is fond of saying - that, and "we're turning the corner." Unfortunately, wishing won't make it so. Bush is fond of pithy slogans, and, as one-time gubernatorial opponent Ann Richards has noted, absolutely "tireless in repeating them." But in truth, he has no plan to stimulate the US economy, much less the tech sector - unless borrowing gargantuan heaps of money abroad while cutting taxes at home can be considered a strategy.

In short, there are only superficial differences between the candidates in terms of tech policy. Kerry has an edge in economic strategy, although, if he is to succeed, there will have to be some short-term pain in service of long-term improvement, and he has not been entirely forthcoming about this unpleasant fact.

Whether America elects Bush or Kerry, the President will be stuck with the unfortunate consequences of Bush's decision to bet the farm on Iraq. A President Kerry will have no choice but deal with it; there are few options, and many, growing liabilities that will drain the United States of blood and treasure for years to come. Anyone expecting Kerry to worm the US out from under these burdens is deluding himself.

Bush is admired by many Americans. He is also intensely despised. He has a solid support base, but also 'high negatives,' as pollsters like to say. Kerry is neither much liked nor much despised, but is instead barely noticeable to many, and embraced by Bush haters with the impersonal urgency of a drowning man clinging to a flotation device.

Considering the mounting security and military pressures and deteriorating economic conditions now threatening the USA - and, by extension, the world - no US President is going to have an easy time in the next four to six years. The wind up is that it hardly matters which poor bugger ends up occupying the White House. Americans, and, sadly, many others in the world, are going to pay a terrible price for Bush's first-term blunders, any way you slice it. ®

Thomas C Greene is the author of Computer Security for the Home and Small Office, a comprehensive guide to system hardening, malware protection, online anonymity, encryption, and data hygiene for Windows and Linux.

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