Company payments to employee benefit insurance brokers has become a focus of the Attorney General of New York, as his investigation expands to include subpoenae to Aetna, Cigna, MetLife and Hartford Life, according to the New York Times. "Contingency payments" reward commercial insurance brokers for achieving sales goals, but not all brokers disclose details of the payments to their customers. Several major brokers received subpoenae this spring as part of A.G. Eliot Spitzer's investigation. "Spitzer Inquiry Expands to Employee-Benefit Insurers" (New York Times, June 12, 2004).
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A related story mentioning similar inquiries by California Attorney General John Garamendi and indicating that the inquiry was prompted by the nonprofit Washington Legal Foundation was in the June 11 Times: "3 Insurers Say New York State Is Investigating Fees to Brokers" (New York Times, June 11, 2004).
A May 2004 backgrounder by the Insurance Information Institute (III) is available at: "Contingent Compensation and Service Agreements Between Insurance Brokers and Insurers"
Reflecting on President Ronald Reagan's legacy, students of political science may examine his choices between negotiation and escalation and in favor of building communication links to other nations and leaders. As world leaders gather today to lay to rest the 40th President, one may look back on his decisions to negotiate with adversaries to end conflicts, despite those who urged uncompromising escalation to win them.
In an opinion piece in today's New York Times, C.U.N.Y. Prof. John Diggins reminds us that back in 1985, "neoconservatives" like Richard Perle, Paul Wolfowitz and Donald Rumsfeld were counselling Reagon to escalate rather than negotiate with the Soviet Union over its military involvement in Afghanistan. He points to George Shultz's memoir, "Turmoil and Triumph," for evidence of the disconnect between President Reagan and the hawks in his administration, and notes the insistence of then Defense Secretary Dick Cheney that perestroika and glasnost were deceptive traps, intended to mislead the West, and would be followed by even greater Soviet militancy.
In the end, Mikhail Gorbachev did "tear down this wall," and led the "Evil Empire" into its self-transformation. In Washington today, he pays his respects to his former adversary.
History may have already shown us the relative wisdom of Ronald Reagan and his neoconservative counsellors. World leaders could do worse than learn from the instincts of "The Great Communicator."
See: The New York Times > Opinion > Op-Ed Contributor: How Reagan Beat the Neocons
Results from the 2004 Computer Crime and Security Survey indicate that theft of intellectual property was the second most expensive computer crime, with denial of service (DOS) being number one. The survey found a "noticeable downturn" in the percentage of companies reporting intrusions to law enforcement, with companies citing concern over negative publicity as a reason. The study noted the availability of cybersecurity insurance despite the shortage of actuarial data, but found that 72% of respondents did not have cybersecurity insurance. The results include data from 494 survey participants and are available at the Computer Security Institute (CSI). Now in its ninth year, The Survey is conducted by CSI with the participation of the San Francisco Federal Bureau of Investigation's (FBI) Computer Intrusion Squad. The survey results are free in PDF format with registration.
Thanks to beSpacific for the tip about this cybercrime resource.
European researchers explored the potential for self-regulation on peer-to-peer (P2P) networks. Their empirical studies revealed a lower incidence of exchange of unlawful content (e.g. child porn and pirated music) in those networks in which users had an ongoing relationship and were identifiable to each others and system administrators. Some notes on their paper, published free online at First Monday.org, follow.
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They review sociological and anecdotal literature, including writings of Rheingold, Hornsby, Castells and Van Dijk. They examined two distinct networks, one an "open," public network in which users had a substantial expectation of anonymity, the second a "private" network with access limited to those in one organization, in which anonymity was not assured. They obtained information about what types of content were available on each network, examined online discussion forum messages between users, and also polled users regarding attitudes toward mores and content.
They report on data in both networks as to user attitudes and mores regarding file sharing. However, the validity of their questionnaire data is cast into doubt by the poor response rate (less than 9%) obtained from the "open" network users, with whom a Web-based instrument was used. A greater rate of response came from the "private" network (78%), in which users were provided questionnaires in person. The data derived from reading discussion forum threads may also be of debatable statistical significance, but was mostly offered in interpretation of other data.
From this data, they saw similarities in attitudes and mores, including a general "laissez faire" attitude to all but the most extreme forms of content (e.g. child porn and bestiality content), with some greater conservatism among the members of the "private" network. The analysts reported evidence that a norm that promoted sharing was strong, and that any norms favoring restraint and peer control were weaker.
They reported a greater tendency among users of the "private" network to accept and conform to social pressure from other users. From the study report: "One reason for this was that anonymity was limited and sanctions could consequently be direct. Users had to be very brave or very foolish to ignore serious warnings from their peers. In fact one respondent reported an incident in which a user had discovered child pornography on the network. This incident was dealt with through collective action by a number of users and system administrators who found out the owner of the computer and posted his identity on the mailing list. After this incident child pornography was no longer encountered."
They contrasted this with their interpretation of online interviews of users of the "open" network who were contacted online: "when we interviewed users of the open WinMX network who seemed to be breaching existing norms, either by downloading while not sharing or by offering offending material. Their reactions * * * , combined with the data about material shared * * *, strongly suggest that in open networks the effects of informal social sanctions are far more limited."
They concluded that "Although there were not many examples of explicit sanctioning in the closed network, extreme forms of deviant behaviour, such as child pornography, were suppressed quite effectively through informal social control."
They did not find the same suppression effect in the "open" network, citing several explanations. First, the practical limitations on real sanctions in a "virtual" world, a lack of use of messaging and blocking and also the observation that "worldwide p2p systems provide anonymity and thus prevent even the naming and shaming of deviants."
The authors cite to several recent studies, but I was disappointed to see no reference to Robert Axelrod's 1984 book on his seminal studies of cooperation through empirical research using the durable, iterated prisoner's dilemma, "The Evolution of Cooperation," a context that seems directly comparable to a "private" network such as that studied by Svennson and Bannister. See an earlier note on Axelrod, the Evolution of Cooperation (1984).
Axelrod's findings were that "the shadow of the future" was a powerful motivation for individuals (both human and non-human) to develop collaborative behavior that may conflict with their immediate self-interest. If those in an encounter (such as a P2P network) expect to meet again, they are more likely to cooperate than when dealing with a "one time only" counterpart. "The future can therefore cast a shadow back upon the present," wrote Axelrod, "and thereby affect the current strategic situation." Because it is founded on the mathematics of game theory, Axelrod's theories are not dependent upon the affinity or consciousness of the collaborating parties.
Axelrod based his work in part upon Richard Dawkin's Kinship Theory presented in "The Selfish Gene" (1976) that looks upon the evolution of co-adaptive behavior among animals.
Among the suggested ways Axelrod suggested for fostering the emergence of cooperation were to enlarge the "shadow of the future" by making interactions between players more frequent and more durable. This can be done by keeping others away (exclusive clubs are one example), by establishing hierarchy and bureaucracy that concentrates interaction between specialists, and by decomposing issues into smaller, more frequent encounters rather than a few large ones. Another way is by improving recognition capabilities with reliable identification of players that enables them to verify which have cooperated or defected in the past and to act accordingly.
These characteristics appear to be likely features of the "private" network (and appear to be absent from the "open" network) examined by Svennson and Bannister. The absence of a reference to either Axelrod or to Dawkins is puzzling, and one upon which the authors may choose to comment if they read this note.
The full paper is available free online at: Pirates, sharks and moral crusaders: Social control in peer–to–peer networks by Jörgen S. Svensson and Frank Bannister
First Monday, volume 9, number 6 (June 2004),
URL: http://firstmonday.org/issues/issue9_6/svensson/index.html
AT this year's Connecticut XPO (a regional trade show focused on resources for small businesses) I met Dr. Karl Prewo of the Connecticut Center for Advanced Technology (CCAT.us), a federally-funded nonprofit organized to assist small technology businesses. In addition to helping arrange professional support and training for technology start-ups, CCAT supports tech education at the K-12 and community college level and is offering incubator space in their location at United Technologies' Research Center near Rentschler Field in East Hartford, Connecticut.
We also stopped to meet folks from Beacon Alliance, a biomedical engineering trade association of private and public institutions based in Hartford that has been around since 1997. See "Public, Private Institutions Unite in Biomedical Alliance," Connecticut Academy of Science and Engineering (CASE) Reports 1999. Beacon will host a Bionanotechnology Symposium and Technology Fair intended to attract bionanotechnology faculty, researchers, entrepreneurs and industrialists. The event is scheduled for October 28, 2004 at Hartford Hospital.
"Beacon" is a service mark of Beacon Alliance, a Biomedical Engineering Alliance and Consortium.
On June 13, 1971, the New York Times began publishing the top secret history of the Vietnam war commissioned by Robert McNamara that came to be known as the Pentagon Papers. The documents had been secretly copied and provided to the Times by Daniel Ellsberg, a former intelligence analyst with the State Department and RAND Corporation who obtained them under authority of his "Top Secret" clearance. Efforts by the administration of President Richard Nixon to halt the publication and to discredit Ellsberg were part of a pattern of activity that ended in a constitutional crisis and Nixon's resignation.
"Secrets: A Memoir of Vietnam and the Pentagon Papers" is Ellsberg's personal story of his years studying the war in Vietnam, including his time travelling "in-country" with civilian advisors and embedded with active combat units, and why he believed publication of the history was essential. The narrative is often overweighted with personal details and colored by his political opinions. It is still an insight into the mind of an insider who starts as a "team player" and becomes an active dissident exposing government secrets.
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Ellsberg opens his book with an anecdotal memoir of his early years, which included service as a Marine infantry officer, and post graduate studies of game theory at Harvard. His involvement with Vietnam began in 1964, when he joined a team analyzing information about the United States support of the government of South Vietnam. He tells of his review of highly confidential assessments for the President of the United States (POTUS) from senior advisors concluding that the Vietnam war could not be won by the United States, that escalation would lead to massive U.S. casualties and that it would be unable to withdraw without national humiliation. The assessments were surrounded with supersecrecy that Ellsberg attributes to the desire to preserve a fiction that POTUS had few real alternatives to escalation.
Ellsberg provides anecdotes of his travels in the countryside around Saigon with John Vann, the civilian affairs advisor to the commander of III Corps, and his anecdotes of a "pacification" effort in the VC-controlled district around the village of Rach Kien. At the time, Rach Kien was described as an area in which U.S. forces had never before tried to operate. Ellsberg patrolled with infantrymen up to their necks in the fetid rice paddies, and described the guerrilla "hit and run" tactics by which a handful of VC could impede U.S. progress. The U.S. eventually abandoned efforts to "pacify" Rach Kien. Years later, Ellsberg saw a report about a new attempt to "pacify" Rach Kien. At the time, it was described as an area in which U.S. forces had never tried to operate.
The story of Rach Kien illustrates a recurring theme of Ellsberg's story: his theory that the mistakes in Vietnam resulted from the inability or unwillingness of those making the decisions to learn from history or critical analysis. He points to the political fate of Robert McNamara, whose advocacy of a negotiated exit strategy within the White House "marked the beginning of the end of his influence with the president and of his tenure." Secrets, p. 182.
Ellsberg describes the major "lesson of Vietnam" as: "the impact on policy failures of internal practices of lying to superiors, tacitly encouraged by those superiors, but resulting in a cognitive failure at the presidential level to recognize realities. This was part of a broader cognitive failure of the bureaucracy I had come to suspect. There were situations -- Vietnam was an example -- in which the U.S. government, starting ignorant, did not, would not learn. There was in Vietnam a whole set of what amounted to institutional 'antilearning' mechanisms working to preserve and guarantee unadaptive and unsuccessful behavior. There was the fast turnover in personnel and the lack of institutional memory at any level. * * * There was a general failure to study history or to analyze or even to record operational experience, especially mistakes. Above all, effective pressures for optimistically false reporting at every level, for describing 'progress' rather than problems or failure, concealed the very need for change in approach or for learning." Ibid at 185-186.
In the history of the earliest years of the Vietnam conflict, Ellsberg saw "realistic internal pessimism, deliberately concealed from the public." In the administrations of both Kennedy and Johnson, Ellsberg concluded, "it was the president who was deceiving the public, not his subordinates who were deceiving him." Id. at 193.
In 1968, after the surprise Tet Offensive, Ellsberg first leaked confidential documents, the top secret "Wheeler Report," which found its way to Senator Fulbright. The Wheeler Report, according to Ellsberg, indicated secret plans to escalate and dramatically expand troop forces in Vietnam. Following the leak, Sen. Fulbright publicly warned the White House against further escalation of the war without express approval from the Congress.
From this incident, Ellsberg concluded that "the president's ability to escalate, his entire strategy throughout the war, had depended on secrecy and lying and thus on his ability to deter unauthorized disclosures -- truth telling -- by officials." Id. at 204. Ellsberg also decided that disclosures that diminished that ability could be "patriotic and constructive." Id. at 206.
In 1968, Richard Nixon had just been elected president on a promise to end the war "with honor," but Ellsberg's insider contacts led him to conclude that Nixon intended to continue support of the war indefinitely. Ellsberg had reached the deep seated personal belief that the continuation and escalation of the Vietnam war was not only a political mistake and strategically destructive but also profoundly immoral, even criminal. He and others at the State Department were concerned that the secret McNamara study (the Pentagon Papers), which was ended in 1969, might become an embarrassment and a target for quiet destruction. To preserve the history, Ellsberg took a complete copy to his new job at RAND.
As the war continued, he leaked more of the Papers to senators, hoping that public knowledge of the history would diminish or eliminate the ability of the White House to continue and expand the war. They were reluctant to publish them, and Senator Fulbright asked Ellsberg, "isn't it after all only history?"
Ellsberg next went to the New York Times, which began publishing the Papers on June 13, 1971. The Oval Office Tapes for June 14, 1971, writes Ellsberg, revealed H.R. Haldeman's concern with publishing the history: they suggested that (in Haldeman's words): "you can't trust the government, you can't believe what they say, and you can't rely on their judgment; and the -- the implicit infallibility of presidents, which has been an accepted thing in America, is badly hurt by this, because it shows that people do things the president wants to do even though it's wrong, and the president can be wrong." Id. at 413. An attempt to enjoin publication ended on June 30 with the Supreme Court decision in New York Times v. United States, 403 U.S. 713 (1971).
Ellsberg was charged with violation of the Espionage act (18 U.S.C. §793) and for theft and conspiracy. President Nixon wanted to also destroy Ellsberg's credibility in the press, which led to the June 1971 burglarization of his psychiatrist's office by "White House Plumbers" Howard Hunt and J. Gordon Liddy. That the Plumbers were working for the White House was revealed in 1973, as part of the Watergate investigation triggered by the Plumbers' botched 1972 break-in at the Democratic National Committee offices at the Watergate. As more information emerged, the judge in Ellsberg's case ruled that the overall pattern of the government's conduct offended a sense of justice and precluded a fair trial for Ellsberg. He dismissed all criminal charges against Ellsberg, with prejudice, on May 11, 1973.
As the trial ended, the Oval Office Tapes later revealed Richard Nixon's personal reaction to the fact that the "sonofabitching thief is made a national hero and is going to get off on a mistrial. And the New York Times gets a Pulitzer Prize for stealing documents. * * * They are trying to get at us with thieves. What in the name of God have we come to?" Id. at 457.
On August 8, 1974, Richard M. Nixon resigned the office of President of the United States in the wake of revelations of his personal involvement in the Watergate cover-up.
See also, from the National Security Archive at George Washington University: The Pentagon Papers: Secrets, Lies and Audiotapes (The Nixon Tapes and the Supreme Court Tape).
And, at Mount Holyoke College, Pentagon Papers, Gravel Edition, Summary and Chapter I.
And also, David Rudenstine, "The Day the Presses Stopped: A History of the Pentagon Papers Case" (1998)
And, Neil Sheehan's Pulitzer Prize winner: "A Bright Shining Lie : John Paul Vann and America in Vietnam" (1989)
Reading: Ellsberg, "Secrets: A Memoir of Vietnam and the Pentagon Papers" (2002)
At Harvard, Nieman Watchdog Project provides an online connection for journalists, academics, independent experts and gadflies to pose informed questions for the press to ask those who should know. The project is a new offering from the Nieman Foundation for Journalism at Harvard University.
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Barry Sussman is the Editor of Nieman Watchdog and explains its goals in an introductory message at: Nieman Watchdog > About Us > Why Watchdog? And why questions?. Sussman is one of the former Washington Post editors who guided the paper through the Watergate scandal.
Sussman explains that "the goal of watchdog journalism is to see that people in power provide information the public should have. * * * NiemanWatchdog.org seeks to encourage more informed reporting by putting journalists in contact with authorities who can suggest appropriate, probing questions and who can serve as resources."
NiemanWatchdog.org will support those who are posing questions for journalists with a weblog, links and additional resources. It encourages comments on its site by registered users.
Attorneys are not "financial institutions" within the meaning of Title V of the Gramm-Leach-Bliley Act (GLBA) 15 U.S.C. §§6801-6809, despite the Federal Trade Commission's position otherwise, says the U.S. District Court.
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After press reports indicated that the FTC regarded attorneys doing real estate settlements, tax planning and tax preparation as subject to GLBA's privacy protection rules, the New York State Bar Association wrote to the FTC, formally requesting recognition that attorneys were exempt. The FTC declined in an April 3, 2003 letter and the Bar Association sought a declaratory judgment. The American Bar Association joined in a parallel suit decided at the same time.
In April, 2004, the District Court for the District of Columbia granted summary judgment to the Bar Association. In its opinion, it concluded that the FTC acted beyond its statutory authority and in a manner that was "arbitrary and capricious."
GLBA places on each "financial institution" an obligation to respect the privacy of its customers and to secure the confidentiality of those customers' "nonpublic personal information" or "NPPI". Title V of GLBA imposes requirements of written disclosure of privacy policies at specified times in the relationship and an "opt out" option before disclosing such "NPPI" to third parties.
Decided April 30, 2004, New York State Bar Ass'n v. Federal Trade Commission, 2004 U.S. Dist. LEXIS 7698 (D.D.C. 2004). For an extended discussion of the goals and legislative history of GLBA and the tradition of state regulation of attorneys and the practice of law, see the earlier decision denying the FTC's motion to dismiss the suit at: New York State Bar Ass'n v. FTC, 276 F.Supp.2d 110 (D.D.C. 2003).
DougSimpson.com/blog
Wharton has a continuing focus on insurance and terrorism reflected in the research of its faculty. A February 2004 working paper by Prof. Kent Smetters, "Insuring Against Terrorism: The Policy Challenge" is at his listing of Working Papers.
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In it, Prof. Smetters compares the increasing government role in providing back-stop insurance against natural catastrophes such as massive hurricanes or earthquakes to the developing government role in insurance against terrorist acts. He argues that government must take some blame for the challenges facing private insurers considering another catastrophic terrrorist event such as that of September 11, 2001.
His paper includes:
The New York Times reports that CIA Director George J. Tenet's surprise resignation for "personal reasons" came on the same day he had been scheduled to appear before the U.S. Senate to rebut criticism of the CIA's performance in a 400-page report from the Senate Intelligence Committee. He cancelled that appearance earlier this week, says the Times. A declassified version of the critical report is expected to soon become public, according to the Times.
Some sources close to Tenet said the report was one factor leading to his decision, according to the Times. The New York Times > Washington > Report Blames Agencies Over Prewar Intelligence
An editorial in the Times critical of Tenet's service calls the timing "terrible." The New York Times > Opinion > George Tenet Resigns
Increasing access to online resources and pre-written papers has increased the temptation for students, journalists, even university presidents, to pass off others' writing as their own. Sharon Stoerger, MLS, MBA, created materials for the Office of the Vice Chancellor for Research at the University of Illinois at Urbana-Champaign and adapted them in a valuable listing of resources on the topic at: Plagiarism. This includes links to scholarly papers, to comparisons of plagarism detection software and services, and to some of the hundreds of sites where term papers are bought and sold online.
An updated tabular presentation of representative criminal case outcomes in Computer Intrusion Cases, from the U.S. Dept. of Justice Computer Crime and Intellectual Property Section (CCIPS).
CSO Magazine published results of its "2004 E-Crime Watch" survey that shows a rise in cybercrime and data intrusions. The survey was conducted in cooperation with the United States Secret Service and the Carnegie Mellon University Software Engineering Institute’s CERT® Coordination Center.
Thanks to Sabrina Pacifica of beSpacific.com for links to these resources.