Cloud Advantage Neg
Uniqueness
Squo Solves
Companies resolve perception link in the status quo
Kendrick 15 (Katharine Kendrick is a policy associate for Internet communications technologies at the
NYU Stern Center for Business and Human Rights., 2.19.15, “Risky Business: Data Localization”
http://www.forbes.com/sites/realspin/2015/02/19/risky-business-data-localization/, ekr)
U.S. companies’ eagerness to please the EU affects their leverage in a place like Russia or China, and undermines their principled calls for a global Internet. Just as
we’ve seen the emergence of company best practices to minimize how information is censored, we need best practices to minimize risks in where it is stored.
Companies should take the following steps: Avoid localizing in a repressive country whenever possible. When Yahoo! entered Vietnam, to meet performance needs
without enabling the government’s Internet repression, it based its servers in Singapore. Explore global solutions. Companies
like Apple and
Google have started encrypting more data by default to minimize inappropriate access by any
government. This doesn’t solve everything, but it’s a step forward for user privacy. Minimize exposure. If you
must have an in-country presence, take steps to minimize risk by being strategic in what staff and services you locate there. Embrace transparency. A
growing number of companies have increased transparency by issuing reports on the number of
government requests they receive. They should also publish legal requirements like localization, so that people understand the underlying risks
to their data. Work together. Companies should coordinate advocacy in difficult markets through organizations like the Global Network Initiative. Tech
companies can take a proactive, collective approach, rather than responding reactively when their
case hits the headlines. We can only expect localization demands to increase—and business pressures to pull in the opposite direction. While
the political dynamics have shifted, companies should still have respect for human rights—and the
strength of the global Internet—at the forefront of decisions over where to store their data.
Freedom Act Solves
Status Quo Freedom Act sufficient
CEA 15 (June 2, 2015, “Washington: CEA Praises Senate Passage of USA FREEDOM Act”
http://www.ce.org/News/News-Releases/Press-Releases/2015-Press-Releases/CEA-Praises-SenatePassage-of-USA-FREEDOM-Act.aspx, ekr)
The Consumer Electronics Association has issued the following news release: The following statement is attributed to Michael Petricone, senior vice
president of government and regulatory affairs, Consumer Electronics Association (CEA)®, regarding the U.S. Senate’s passage of H.R.
2048, the Uniting and Strengthening America by Fulfilling Rights and Ensuring Effective Discipline Over Monitoring (USA FREEDOM) Act of 2015: “We
welcome this important reform to U.S. intelligence gathering which takes critical steps to increase
transparency and restore trust in American businesses, all while maintaining our commitment to
preserving our national security. The bipartisan USA FREEDOM Act is common-sense reform to our nation’s intelligence gathering
programs, which will preserve American businesses’ competitiveness worldwide, while continuing to protect our national
security. “Following the Senate passage, the legislation now heads to the White House, where we anticipate swift action by President Obama to sign this legislation
into law.”
New Freedom Act is sufficient to solve US’s global credibility gap.
HRW ‘15
Human Rights Watch is an independent, international organization that works as part of a vibrant movement to uphold human
dignity and advance the cause of human rights for all. “Strengthen the USA Freedom Act” - May 19, 2015 http://www.hrw.org/news/2015/05/19/strengthen-usa-freedom-act
As the Senate considers the USA Freedom Act this week, policymakers should strengthen it by limiting large-scale collection of records and reinforcing transparency
and carrying court reforms further. The
Senate should also take care not to weaken the bill, and should reject any
amendments that would require companies to retain personal data for longer than is necessary for business purposes. It has been two years since the
National Security Agency (NSA) whistleblower Edward Snowden unleashed a steady stream of documents that exposed the intention by the United States and the
United Kingdom to “collect it all” in the digital age. These revelations demonstrate how unchecked surveillance can metastasize and undermine democratic
institutions if intelligence agencies are allowed to operate in the shadows, without robust legal limits and oversight.
Representatives approved
On May 13, the US House of
the USA Freedom Act of 2015 by a substantial margin. The bill represents the latest attempt by Congress to rein in
one of the surveillance programs Snowden disclosed—the NSA’s domestic bulk phone metadata collection under Section 215 of the USA Patriot Act. The House vote
followed a major rebuke to the US government by the US Court of Appeals for the Second Circuit, which ruled on May 7 that the NSA’s potentially nationwide
dragnet collection of phone records under Section 215 was unlawful. Section 215 is set to expire on June 1 unless Congress acts to extend it or to preserve specific
powers authorized under the provision, which go beyond collection of phone records. Surveillance reforms are long overdue and can be accomplished while
protecting US citizens from serious security threats. Congress and the Obama administration should end all mass surveillance programs, which unnecessarily and
disproportionately intrude on the privacy of hundreds of millions of people who are not linked to wrongdoing. But reforming US laws and reversing an increasingly
global tide of mass surveillance will not be easy. Many of the programs Snowden revealed are already deeply entrenched, with billions of dollars of infrastructure,
contracts, and personnel invested. Technological capacity to vacuum up the world’s communications has outpaced existing legal frameworks meant to protect
privacy. The Second Circuit opinion represents an improvement over current law because it establishes that domestic bulk collection of phone metadata under
Section 215 of the Patriot Act cannot continue. Section 215 allows the government to collect business records, including phone records, that are “relevant” to an
authorized investigation. The court ruled that the notion of “relevance” could not be stretched to allow intelligence agencies to gather all phone records in the US.
However, the opinion could be overturned and two other appeals courts are also considering the legality of the NSA’s bulk phone records program. The opinion also
does not address US surveillance of people not in the US. Nor does it question the underlying assumption that the US owes no privacy obligations to people outside
its territory, which makes no sense in the digital age and is inconsistent with human rights law requirements. Even if the Second Circuit opinion remains good law,
congressional action will be necessary to address surveillance programs other than Section 215—both domestic and those affecting people outside the US—and to
create more robust institutional safeguards to prevent future abuses. The courts cannot bring about reforms to increase oversight and improve institutional
oversight on their own. Human
Rights Watch has supported the USA Freedom Act because it is a modest, if
incomplete, first step down the long road to reining in the NSA excesses. Beyond ending bulk records collection, the bill would begin to reform the
secret Foreign Intelligence Surveillance Act (FISA) Court, which oversees NSA surveillance, and would introduce new transparency measures to improve oversight. In
passing the bill, the House of Representatives also clarified that it intends the bill to be consistent with the Second Circuit’s ruling, so as to not weaken its findings.
The bill is no panacea and, as detailed below, would not ensure comprehensive reform. It still leaves open the possibility of
large-scale data collection practices in the US under the Patriot Act. It does not constrain surveillance under Section 702 of the FISA Amendments Act nor Executive
Order 12333, the primary legal authorities the government has used to justify mass surveillance of people outside US borders. And the bill does not address many
modern surveillance capabilities, from mass cable tapping to use of malware, intercepting all mobile calls in a country, and compromising the security of mobile SIM
cards and other equipment and services.
Nonetheless, passing a strong USA Freedom Act would be a long-overdue step in the
right direction. It would show that Congress is willing and able to act to protect privacy and impose oversight
over intelligence agencies in an age when technology makes ubiquitous surveillance possible. Passing this bill would also help shift
the debate in the US and globally and would distance the United States from other countries that
seek to make mass surveillance the norm. On a global level, other governments may already be
emulating the NSA’s approach, fueling an environment of impunity for mass violations of privacy. In the last year,
France, Turkey, Russia, and other countries have passed legislation to facilitate or expand large-scale
surveillance. If the USA Freedom Act passes, it would be the first time Congress has affirmatively
restrained NSA activities since the attacks of September 11. Key supporters of the bill have vowed to take up reforms to
other laws next, including Section 702 of the FISA Amendments Act.
Cloud Growth Now
Cloud computing growing now, multiple projections and predictive evidence prove
Columbus ’15 – Louis Columbus, Forbes journalist specializing in CRM, Cloud Computing,
ERP and Enterprise Software, Vice President Worldwide Marketing at iBASEt, Adjunct
Professor Webster University, (“Roundup Of Cloud Computing Forecasts And Market
Estimates, 2015” Jan 24 2015, Forbes, Available Online at
http://www.forbes.com/sites/louiscolumbus/2015/01/24/roundup-of-cloud-computingforecasts-and-market-estimates-2015/) N.H
Global SaaS software revenues are forecasted to reach $106B in 2016, increasing 21% over projected 2015 spending levels.
A Goldman
Sachs study published this month projects that spending on cloud computing infrastructure and
platforms will grow at a 30% CAGR from 2013 through 2018 compared with 5% growth for the overall
enterprise IT.
Centaur Partners and other firms mentioned in this roundup are seeing more enterprise-size deals for
cloud computing infrastructure and applications. While each of these consultancies and research firms
have varying forecasts for the next few years, all agree that cloud computing adoption is accelerating
in enterprises on a global scale.
Key take-aways from the roundup are provided below:
By 2018, 59% of the total cloud workloads will be Software-as-a-Service (SaaS) workloads, up from 41% in
2013. Cisco is predicting that by 2018, 28% of the total cloud workloads will be Infrastructure-as-a-Service
(IaaS) workloads down from 44% in 2013. 13% of the total cloud workloads will be Platform-as-a-Service (PaaS) workloads in 2018, down from
15% in 2013. The following graphic provides a comparative analysis of IaaS, PaaS and SaaS forecasts from 2013 to 2018. Source: Cisco Global
Cloud Index: Forecast and Methodology, 2013–2018. (PDF, free, no opt-in).
Centaur Partners’ analysis of SaaS & cloud-based business application services revenue forecasts the market growing from $13.5B in 2011 to
$32.8B in 2016, attaining a 19.5% CAGR. Centaur provides a useful overview of current market conditions including M&A activity in their latest
market overview published this month, Introduction to Centaur Partners: SaaS Market Overview, (PDF, free, no opt-in). 42% of IT decision
makers are planning to increase spending on cloud computing in 2015, with the greatest growth in enterprises with over 1,000 employees
(52%). The top five tech spending increases in 2015 are shown in the following graphic. Source: Computerworld’s 2015 Forecast Predicts
Security, Cloud Computing And Analytics Will Lead IT Spending.
Global SaaS software revenues are forecasted to reach $106B in 2016, increasing 21% over projected 2015 spending levels.
Spending on
integration, storage management, and database management systems are projected to experience
the greatest growth in 2015. These and other key insights are from Forrester’s SaaS software subscription revenue by category show
below. Source: Enterprise software spend to reach $620 billion in 2015: Forrester.
$78.43B in SaaS revenue will be generated in 2015, increasing to $132.57 in 2020, attaining a compound annual growth rate (CAGR) of 9.14%.
The following graphic and table provides an overview of Forrester’s Global Public Cloud Computing market size analysis and forecast for the
years 2011 to 2020. Source: Institut Sage.
Spending on cloud computing infrastructure and platforms is expected to grow at a 30% CAGR from 2013 through 2018 compared with 5%
growth for the overall enterprise IT. Goldman Sachs estimates that Amazon has taken in $4B in revenue, or 26% of the IaaS and PaaS markets,
in the past 12 months. These and other insights and the graphics below are from an analysis of the recent Goldman Sachs cloud computing
report. Thank you Michael Coté, Research Director, Infrastructure Software at 451 Research for freely sharing your latest presentation, Cloud
State of the Union, 2015. Additional interesting links regarding Goldman Sachs’ recent cloud computing study include Battle Of Cloud Titans Has
Just Begun, Goldman Says and Red Hat: Goldman Cuts to Sell Amidst Bullish Cloud View.
Security (36%), cloud computing (31%) and mobile devices (28%) are the top 3 initiatives IT executives
are planning to have their organizations focus on over the next 12 months. Source: 2015 State of the Network
Study, Technology Adoption Trends & Their Impact on the Network (free PDF, no opt in). A summary of the study can be found here: State of
the Network 2015.
IDC predicts that by 2016, there will be an 11% shift of IT budget away from traditional in-house IT
delivery, toward various versions of cloud computing as a new delivery model. By 2017, 35% of new
applications will use cloud-enabled, continuous delivery and enabled by faster DevOps life cycles to streamline rollout
of new features and business innovation. Source: 2015-2017 Forecast: Cloud Computing to Skyrocket, Rule IT Delivery.
By 2018, IDC forecasts that public cloud spending will more than double to $127.5 billion. This forecast is
broken down as follows: $82.7 billion in SaaS spending, $24.6 billion for IaaS and $20.3 billion in PaaS expenditures. Source: Forecasts Call For
Cloud Burst Through 2018.
27.8% of the worldwide enterprise applications market will be SaaS-based, generating $50.8B in revenue up from $22.6B or
16.6% of the market in 2013. IDC also estimates the overall enterprise applications market in 2013 was $135.9B. Source: IDC
Predicts SaaS Enterprise Applications Will Be A $50.8B Market By 2018.
By
2016 over 80% of enterprises globally will using IaaS, with investments in private cloud computing
showing the greater growth. Ovum forecasts that by 2016, 75% of EMEA-based enterprises will be using IaaS. These and other
insights are from the presentation, The Role of Cloud in IT Modernisation: The DevOps Challenge (free PDF, no opt in). The graphic below
provides an analysis of cloud computing adoption in EMEA and globally.
Cloud computing growing in squo
McCue 14 –[TJ McCue, Forbes Technology contributor/journalist, (“Cloud Computing:
United States Businesses Will Spend $13 Billion On It” JAN 29, 2014, Forbes Tech,
Available Online at http://www.forbes.com/sites/tjmccue/2014/01/29/cloudcomputing-united-states-businesses-will-spend-13-billion-on-it/) N.H
Instead of a slow-moving fluffy white cloud image, the cloud computing industry should use a tornado
– that might be a better way to visualize how fast cloud computing is growing today. Amazon is
dominating, but is followed by the usual suspects: IBM IBM +2.40%, Apple AAPL +2.44%, Cisco, Google
GOOG +1.80%, Microsoft MSFT +0.00%, Salesforce, and Rackspace, to name a few. (Disclosure: I am on
the paid blogger team for IBM Midsize Insider, which covers technology pertinent to midsize companies,
including the cloud, among other topics.)
“The cloud” is frequently in the news, but there is also a fair amount of confusion, outside of technology
teams. What is cloud computing and why do businesses need to care? IBM published this handy
infographic: 5 Reasons Businesses Use The Cloud. Among the reasons: Collaboration, better access to
analytics, increasing productivity, reducing costs, and speeding up development cycles.
By 2015, end-user spending on cloud services could be more than $180 billion.
It is predicted that the global market for cloud equipment will reach $79.1 billion by 2018
If given the choice of only being able to move one application to the cloud, 25% of respondents would
choose storage
By 2014, businesses in the United States will spend more than $13 billion on cloud computing and
managed hosting services.
According to Jack Woods at Silicon Angle, there’s some serious growth forecasted and he lists 20 recent
cloud computing statistics you can use to make your case for why you need the cloud or to understand
why you should consider it for your business. The above bullet points come from his post.
Massive growth of cloud computing in squo- especially true in the American context
Woods 14 – Jack Woods, cloud market contributor and journalist at siliconeangle, (“20
cloud computing statistics every CIO should know” Jan 27 14, available online at
http://siliconangle.com/blog/2014/01/27/20-cloud-computing-statistics-tc0114/) N.H
20 Cloud Computing Stats Every CIO Should Know . 1. By 2015, end-user spending on cloud
services could be more than $180 billion (Tweet this) . 2. It is predicted that the global market for
cloud equipment will reach $79.1 billion by 2018 (Tweet this) . 3. If given the choice of only being
able to move one application to the cloud, 25% of respondents would choose storage
(Tweet this) . 4. By 2014, businesses in the United States will spend more than $13 billion on cloud
computing and managed hosting services (Tweet this) . 5. Throughout the next five years, a 44%
annual growth in workloads for the public cloud versus an 8.9% growth for “on-premise” computing
workloads is expected (Tweet this) . 6. 82% of companies reportedly saved money by moving to the
cloud (Tweet this) . 7. More than 60% of businesses utilize cloud for performing IT-
related operations (Tweet this) . 8. 14% of companies downsized their IT after cloud
adoption (Tweet this) . 9. 80% of cloud adopters saw improvements within 6 months of
moving to the cloud (Tweet this) . 10. 32% of Americans believe cloud computing is a
thing of the future (Tweet this) . 11. There’s an estimated 1 exabyte of data stored in
the cloud (Tweet this) . 12. More than half of survey respondents say their organization
currently transfers sensitive or confidential data to the cloud (Tweet this) . 13. Cisco
forecasts that global data center traffic will triple from 2.6 zettabytes in 2012 to 7.7
zettabytes annually in 2017, representing a 25 percent CAGR (Tweet this) . 14. Global data
center traffic will grow threefold (a 25 percent CAGR) from 2012 to 2017, while global cloud traffic will
grow 4.5-fold (a 35 percent CAGR) over the same period (Tweet this) . 15. From 2012 to 2017, data
center workloads will grow 2.3-fold; cloud workloads will grow 3.7-fold (Tweet this) . 16. 2014 is
the first year the majority of workloads will be on the cloud as 51% will be processed in
the cloud versus 49% in the traditional IT space (Tweet this) . 17. 545 cloud services are
in use by an organization on average (Tweet this) . 18. 56% of survey respondents trust
the ability of cloud providers to protect the sensitive and confidential data entrusted to
them (Tweet this) . 19. 59% of all new spending on cloud computing services originates from North
American enterprises, a trend projected to accelerate through 2016 (Tweet this)
Internal Links
Big Data Doesn’t Solve HC
Big data doesn’t solve disease—predictions are too difficult and the bar for entry is
too low
White 15 - Michael White is a systems biologist at the Department of Genetics and the Center for Genome Sciences and Systems Biology at the Washington
University School of Medicine in St. Louis, where he studies how DNA encodes information for gene regulation. (“The Ethical Risks of Detecting Disease Outbreaks
With Big Data,” http://www.psmag.com/health-and-behavior/ethical-risks-of-detecting-disease-outbreaks-with-big-data 2/24/2015) STRYKER
One of the most urgent ethical issues that the researchers identify lies at what they call "the nexus of ethics and methodology." The
ethical issue can
be reduced to one question: Do these methods actually work? Ensuring that the methods work "is an
ethical, not just a scientific, requirement," the researchers note. Unlike some other social media experiments, a flawed public
health monitoring program can cause serious physical and economic harm to large numbers of people.
Digital disease detection programs are relatively easy to set up compared to traditional disease monitoring systems, which
means there is a risk that the bar for entering this field might be dangerously low. An underprediction of a disease outbreak can result in complacency and lack of preparedness by health
officials or the public. An over-prediction could cause panic, misallocation of limited supplies of
vaccines or medical resources, and, as some reactions to the recent Ebola outbreak demonstrated,
damaging stigmatization of people or communities who don't pose a risk. As the physicist Niels Bohr once noted,
prediction is hard—especially about the future. Big data programs and algorithms often perform well
when they’re used to “predict” the existing data that was used to help build them, but then do poorly
when confronted with new data. That's where digital disease detection tools that use social media
data often run into trouble. Google Flu Trends looked impressive in its initial report in 2009, where it was used to retroactively predict
flu activity of previous years. But it largely missed the two waves of H1N1 swine flu that hit later in 2009 . As the Google Flu
researchers wrote, "Internet search behavior changed during pH1N1, particularly in the categories 'influenza complications' and 'term for influenza'"—two search
terms that are particularly important in the algorithm. The
program also over-predicted the severity of the 2011-12 flu
season by 50 percent .
Big data doesn’t solve healthcare – multiple barriers and empirics prove
**predictive analytics/comparative data are referring to the same idea of large databases with patient
information i.e. big data in general
Crockett 14 (David, Ph.D. from University of Colorado in medicine, Senior Director of Research and
Predictive Analytics at Health Catalyst, “3 Reasons Why Comparative Analytics, Predictive Analytics, and
NLP Won’t Solve Healthcare’s Problems”, https://www.healthcatalyst.com/3-reasons-why-comparativeanalytics-predictive-analytics-and-nlp-wont-solve-healthcares-problems/)
Comparative Data Doesn’t Drive Improvement We’ve had comparative data for years in the U.S.
healthcare system and it hasn’t moved the needle towards better, at all. In fact, the latest OECD data ranks
the U.S. even worse than we’ve ever been on healthcare quality and cost. Comparative data, like the
OECD, is interesting and certainly worth looking at, but it’s far from enough to drive improvements in an organization
down to the individual patient. To drive that sort of change, you have to get your head and hands dirty in your own data
ecosystem, not somebody else’s that is at best a rough facsimile of your organization. There are too many variables and
variations in healthcare delivery right now that add too much noise to the data to make comparative
analytics as valuable as some pundits advocate. We don’t even have an industry standard and clinically
precise definition of patients that should be included (and excluded from routine management) in a diabetes registry,
much less the other 15 chronic diseases and syndromes we should be managing. Predictive Analytics Fails to Include Outcomes We’ve also
had predictive analytics supporting risk stratification for years in healthcare, particularly in case management, but
without outcomes data, what are we left to predict ? Readmissions. That’s a sad state of affairs. Before we start believing
that predictive analytics is going to change the healthcare world, we need to understand how it works, technically and programmatically.
Without protocol and patient-specific outcomes data,
predictive analytics is largely vendor smoke and mirrors in all but
a very small number of use cases.
Big data doesn’t work for disease—only works as well as actual data collection
Swift 14 - Janet Swift is a spreadsheets and statistics specialist for I-Programmer. (“Google Flu Trends Adopts New Model,” http://www.iprogrammer.info/news/197-data-mining/7939-google-flu-trends-new-model.html 11/3/2014) STRYKER
Google Flu Trends is launching a new model in the United States for the coming 2014/2015 flu season.
The important difference is that it is going to incorporate CDC flu data - which rather ruins its original idea. Google Flu Trends (GFT) was launched
in 2008 to predict how many cases of flu are likely to occur based on "aggregate search data". The
premise used by the model was that there is a correlation between the number of cases of flu and the
number of searches on the topic of flu. So rather than collect data from doctors and hospitals about people showing symptoms you can
instead look for searches using terms associated with flu such as "cough" or "fever". Initially the model worked well. Not only did it provide
accurate estimates of the number of cases of flu, it did so ahead of those from the CDC (Centers for Disease Control and Prevention). But over time
Google's model started to overpredict the incidence of flu, due to what could be interpreted as a
positive feedback effect . Heightened media attention to flu when the incidence of flu rises leads to
more people googling flu related terms. For the 2012/2013 flu season the GFT prediction exceeded the
number of "real" flu cases by 95%. Responding to the research that revealed this anomaly Google adjusted the model for
the 2013/2014 flu season (see the details in Google Updates Flu Model but it continued to overpredict. So a more drastic
remedy was sought. According to Christian Stefansen, Senior Software Engineer, in a post on the Google Research blog
announcing "brand new engine" for GFT, for the coming flu season in the US, Google is substituting a:
"more robust model that learns continuously from official flu data". While this may well improve the
model's accuracy, the fact that it uses actual data defeats the idea that flu could be predicted solely
on the basis of Internet users search behavior. If the new model works well, it won't be nearly as interesting a finding as the success of
the old model.
Big data analysis is ineffective—
A. Selection bias
Hoffman and Podgurski 13 - Sharona Hoffman is a Edgar A. Hahn Professor of Law and Professor of Bioethics and Co-Director of LawMedicine Center at Case Western Reserve University School of Law. Andy Podgurski is a Professor of Electrical Engineering and Computer Science at Case Western
Reserve University. (“The Use and Misuse of Biomedical Data: Is Bigger Really Better?” American Journal of Law & Medicine, 39 Am. J. L. and Med. 497, 2013)
STRYKER
If data subjects have the opportunity to opt out of inclusion in a database or if certain individuals' records are otherwise
excluded, a class of problems often called [*522] "selection bias" may arise. n227 Selection bias may occur
when the subset of individuals studied is not representative of the patient population of interest . n228
This kind of selection bias could manifest, for example, if a disproportionate number of people of one
ancestry or economic class opt out of participating in a database. n229 It can likewise exist if individuals
with certain behavior traits that might be important in some studies--such as diet, exercise, smoking status, and alcohol or
drug consumption--choose not to participate or cannot access medical facilities in which studies take place .
n230 Selection bias can distort assessments of measures such as disease prevalence or exposure risk
because study estimates will differ systematically from the true values of these measures for the
target population. n231 That is, the estimates will not be generalizable from the research subjects to the larger population about
which analysts wish to draw conclusions. n232 Another, more subtle kind of selection bias, which is also called " collider-stratification bias ," n233
"collider-bias," n234 or "M-bias," n235 is specific to causal-effect studies. n236 These studies typically seek to measure
the average beneficial effect on patients of a particular treatment or the average harmful effect on
individuals of a particular exposure. n237 Collider-stratification bias occurs in analyzing study data when
the analysis is conditioned on (e.g., stratified by) one or more levels of a variable that is a common effect (a
"collider") of both the treatment/exposure variable and the outcome variable or that is a common effect
of a cause of the treatment/exposure and a cause of the outcome. n238 Consider the following classic example.
Commonly, some patients are lost to follow-up, and thus outcome measurements that would be
essential for research purposes are unavailable. The data from these patients cannot be included in
studies. Both the treatment and outcome at issue may influence which patients stop seeking medical
care. Patients may fail to return for follow-up both because the treatment is unpleasant (treatment factor) and
because they actually feel better and don't see a need to return to their doctors (an outcome factor). The loss of these study subjects can
create a spurious statistical association between the treatment/exposure variable and the outcome
variable that becomes mixed with and distorts the true causal effect of the former on the latter. n239
Because collider-stratification bias is associated with [*523] the exclusion of some patients from a study, it is categorized as a type of selection bias. n240
B. Confounding bias
Hoffman and Podgurski 13 - Sharona Hoffman is a Edgar A. Hahn Professor of Law and Professor of Bioethics and Co-Director of LawMedicine Center at Case Western Reserve University School of Law. Andy Podgurski is a Professor of Electrical Engineering and Computer Science at Case Western
Reserve University. (“The Use and Misuse of Biomedical Data: Is Bigger Really Better?” American Journal of Law & Medicine, 39 Am. J. L. and Med. 497, 2013)
STRYKER
In observational causal-effect studies, confounding bias (confounding) may be an even greater concern
than selection bias . n241 "Classical" confounding occurs because of the presence of a common cause of
the treatment/exposure variable and the outcome variable. n242 Confounding is different from collider-stratification bias
because it involves a common cause of the treatment/exposure and outcome variables rather than a
common effect of the variables. n243 The following hypothetical illustrates classical confounding. Suppose a physician's treatment choices are
influenced by the severity or duration of a patient's disease, which also influence the outcome of treatment. n244 Thus, patients at a later stage of a disease may
receive one treatment (treatment A) and those who are at an earlier stage may receive a different therapy (treatment B). At the same time, sicker patients may
have worse treatment outcomes than healthier individuals. Unless
such a common cause, which is called a "confounding
variable" or "confounder," is adjusted for appropriately during statistical data analysis, it may induce
a spurious association between the treatment variable and the outcome variable, which distorts
estimation of the true causal effects of treatments. n245 In other words, researchers may reach incorrect
conclusions regarding the efficacy of the two treatments because of the confounding variable: the
degree of sickness suffered by patients receiving the different therapies. Treatment A may appear to
be less effective than treatment B not because it is in fact an inferior therapy but because so many of
the patients receiving treatment A are in a late stage of the disease and would not do well no matter
what treatment they received. This particular form of confounding, called "confounding by indication," is especially challenging to adjust for,
because it may involve multiple factors that influence physicians' treatment decisions. n246 Socioeconomic factors and patient lifestyle
choices may also be confounders. Those who lack financial resources or adequate health coverage
may select less expensive treatments not because those are the best choices for them but because
those are the only affordable options. n247 Low income may also separately lead to poor health for reasons such as poor nutrition or
financial stress. In the case of preventive care, a treatment's perceived benefits may be amplified because health-oriented
individuals interested in the intervention also pursue exercise, low-fat diets, and other healthpromoting behaviors. These patients' impressive outcomes thus would not be associated solely with
the preventive measure. n248
C. Measurement bias
Hoffman and Podgurski 13 - Sharona Hoffman is a Edgar A. Hahn Professor of Law and Professor of Bioethics and Co-Director of LawMedicine Center at Case Western Reserve University School of Law. Andy Podgurski is a Professor of Electrical Engineering and Computer Science at Case Western
Reserve University. (“The Use and Misuse of Biomedical Data: Is Bigger Really Better?” American Journal of Law & Medicine, 39 Am. J. L. and Med. 497, 2013)
STRYKER
Measurement biases arise from errors in measurement and data collection . n262 Observational study
results may be compromised if the biomedical records that are analyzed contain such errors. Measurement
errors occur for a variety of reasons. Measurement instruments might not be calibrated properly or might lack
sufficient sensitivity to detect differences in relevant variables. n263 Storage time or conditions for biological samples
might be different and might affect study results. n264 To the extent that researchers solicit and record patients' own accounts and
memories, the subjects' ability to recall details may be influenced by the questioner's competence, patience, and apparent
sympathy or by the degree to which the patient perceives the topic to be important and relevant to her life. n265 In addition, patients may have
impaired memories or may lie in response to questions if they are embarrassed about the truth. n266 Accurate measurement
may be further hindered by incomplete, erroneous, or miscoded EHR data that obfuscates true
values . n267 In causal-effect studies, errors in measurement of the treatment/exposure and the
outcome are most problematic when they are associated (dependent) and when they are differential, that
is, when the treatment affects the measurement error for the outcome or the outcome affects the
measurement error for the treatment. n268 For example, differential measurement error could occur in a study of the effect of treatment A
on dementia, if the use of A was determined only by interviewing study participants, because dementia affects subjects' ability to recall whether and how they were
Mismeasurement of confounding variables also impedes adjustments intended to eliminate
confounding bias. n270
treated. n269
Healthcare prediction can’t be scaled up – no motivation and structural problems
Crockett 13 (David, Ph.D. from University of Colorado in medicine, Senior Director of Research and
Predictive Analytics at Health Catalyst, “Using Predictive Analytics in Healthcare: Technology Hype vs.
Reality”, https://www.healthcatalyst.com/predictive-analytics-healthcare-technology)
The buzzword fever around predictive analytics will likely continue to rise and fall. Unfortunately,
lacking the proper infrastructure, staffing and resource to act when something is predicted with high
certainty to happen, we fall short of the full potential of harnessing historic trends and patterns in
patient data. In other words, without the willpower for clinical intervention, any predictor – no
matter how good – is not fully utilized.
Skepticism
You should be generally skeptical of their evidence – it overstates the value of big data –
studies prove data is mostly irrelevant now
Aslett 13 (Matt, research director for 451 research, formerly the Deputy Editor of monthly magazine
Computer Business Review and ComputerWire's daily news service, “Big data reconsidered: it's the
economics, stupid”, https://451research.com/report-short?entityId=79479&referrer=marketing)
For the past few years the data management industry has been in the grip of a fever related to 'big data' – a
loosely defined term that has been used to describe analysis of large volumes of data, or analysis of unstructured data, or high-velocity data, or
social data, or predictive analytics, or exploratory analytics or all of the above – and more besides. The
expectations for the
potential of big data to revolutionize the data management and analytics industry are great and
inflated , to the extent that it is easy to become disillusioned. A quick check of recent news headlines
suggests that big data has the potential to solve world hunger, defeat terrorism, close the gender gap,
bring about world peace, cure cancer and identify life on Mars. We don't doubt that data management and analytics
will have a critical role to play in efforts related to all those issues, but there is clearly a gap between the potential of big data and the extent to
which related technologies have been adopted to date. For example, interviews from
TheInfoPro, a service of 451 Research, with
storage professionals indicate that big data accounted for just 3% of the total data storage footprint in 2012
– and the exact same percentage in 2013 . While we believe that the big data trend has the potential to revolutionize the IT
industry by enabling new business insight based on previously ignored and underutilized data, it is clear that
massively over-hyped .
big data is also
Impact Defense
Disease Defense
1. No zoonotic disease impact – multiple warrants
A. Empirics Prove
Ridley 12 (Matt Ridley, columnist for The Wall Street Journal and author of The Rational Optimist: How
Prosperity Evolves, “Apocalypse Not: Here’s Why You Shouldn’t Worry About End Times,”
http://www.wired.com/wiredscience/2012/08/ff_apocalypsenot/all/)
The emergence of AIDS led to a theory that other viruses would spring from tropical rain forests to wreak
revenge on humankind for its ecological sins. That, at least, was the implication of Laurie Garrett’s 1994 book, The Coming Plague:
Newly Emerging Diseases in a World Out of Balance. The most prominent candidate was Ebola, the hemorrhagic fever that
starred in Richard Preston’s The Hot Zone, published the same year. Writer Stephen King called the book “one of the most horrifying things I’ve
ever read.” Right on cue, Ebola appeared again in the Congo in 1995, but it soon disappeared. Far from being a harbinger, HIV
was the
only new tropical virus to go pandemic in 50 years.¶ In the 1980s British cattle began dying from mad cow
disease, caused by an infectious agent in feed that was derived from the remains of other cows. When people, too, began to catch this
disease, predictions of the scale of the epidemic quickly turned terrifying: Up to 136,000 would die,
according to one study. A pathologist warned that the British “have to prepare for perhaps thousands, tens of thousands, hundreds of
thousands, of cases of vCJD [new variant Creutzfeldt-Jakob disease, the human manifestation of mad cow] coming down the line.” Yet the
total number of deaths so far in the UK has been 176 , with just five occurring in 2011 and none so far in
In 2003 it was SARS , a virus from civet cats, that ineffectively but inconveniently led to quarantines in Beijing and
Toronto amid predictions of global Armageddon. SARS subsided within a year , after killing just 774
people. In 2005 it was bird flu, described at the time by a United Nations official as being “like a combination of
global warming and HIV/AIDS 10 times faster than it’s running at the moment.” The World Health
Organization’s official forecast was 2 million to 7.4 million dead. In fact, by late 2007, when the disease petered out, the death toll was
roughly 200. In 2009 it was Mexican swine flu. WHO director general Margaret Chan said: “It really is all of humanity that is under threat
during a pandemic.” The outbreak proved to be a normal flu episode.¶The truth is, a new global pandemic is growing less
likely, not more. Mass migration to cities means the opportunity for viruses to jump from wildlife to
the human species has not risen and has possibly even declined, despite media hype to the contrary. Water- and
insect-borne infections—generally the most lethal—are declining as living standards slowly improve.
2012.¶
It’s true that casual-contact infections
such as colds are thriving—but only by being mild enough that their
victims can soldier on with work and social engagements, thereby allowing the virus to spread. Even if a lethal virus does go
global, the ability of medical science to sequence its genome and devise a vaccine or cure is getting
better all the time.
B. Burnout and variation check
York 14 (Ian, head of the Influenza Molecular Virology and Vaccines team in the Immunology and
Pathogenesis Branch of the Influenza Division at the CDC, PhD in Molecular Virology and Immunology
from McMaster University, M.Sc. in Veterinary Microbiology and Immunology from the University of
Guelph, former Assistant Prof of Microbiology & Molecular Genetics at Michigan State, “Why Don't
Diseases Completely Wipe Out Species?” 6/4/2014, http://www.quora.com/Why-dont-diseasescompletely-wipe-out-species)
But mostly diseases don't drive species extinct. There are several reasons for that. For one, the most dangerous
diseases are those that spread from one individual to another. If the disease is highly lethal , then the
population drops, and it becomes less likely that individuals will contact each other during the infectious phase.
Highly contagious diseases tend to burn themselves out that way.¶ Probably the main reason is variation. Within the
host and the pathogen population there will be a wide range of variants. Some
hosts may be naturally resistant. Some pathogens
will be less virulent . And either alone or in combination, you end up with infected individuals who survive .¶ We see this in
HIV, for example. There is a small fraction of humans who are naturally resistant or altogether immune to HIV, either because of their CCR5 allele or their MHC Class
I type. And there are a handful of people who were infected with defective versions of HIV that didn't progress to disease. ¶ We can see indications of this sort of
thing happening in the past, because our genomes contain many instances of
pathogen resistance genes that have spread through
the whole population. Those all started off as rare mutations that conferred a strong selection advantage to the
carriers, meaning that the specific infectious diseases were serious threats to the species.
Innovation Defense
Innovation high and inevitable
Vivek Wadhwa 14, fellow at the Rock Center for Corporate Governance at Stanford University,
director of research at the Center for Entrepreneurship and Research Commercialization at Duke’s
engineering school and distinguished scholar at Singularity and Emory universities, “How the United
States is reinventing itself yet again”, 1/2/14,
http://www.washingtonpost.com/blogs/innovations/wp/2014/01/02/how-the-united-states-isreinventing-itself-yet-again/
And that’s not all the pessimists say. They also argue that while the United States continues to dominate in the emergence of new
technology powerhouses, the biggest IPO of the decade belongs to Facebook, a social network that is more media company than technology
innovator. Stifling red tape and regulations has driven costs of testing new medicines and medical devices so high that many drug
companies have shifted testing regimes and market focus to Europe and Asia. Despite mounting evidence that
skilled immigrant entrepreneurs have delivered a wildly disproportionate share of the country’s technology innovation and technology job
growth, the powers that be in Washington, D.C. have, even with broad bipartisan support, not mustered up the votes to reform the country’s
regressive and punitive immigration policies. Add to all of this an aging populace requiring more and more support from younger workers,
ballooning health costs and a tax structure that beggars the young to underwrite benefits for the aged, and
the United States looks
more and more like a historical footnote than a superpower.¶ Peel back the layers of the onion, and
the reality appears quite different. In fact, the United States stands on the cusp of a dramatic revival and
rejuvenation, propelled by an amazing wave of technological innovation . A slew of breakthroughs will
deliver the enormous productivity gains and the societal dramatic cost savings needed to sustain
economic growth and prosperity. These breakthroughs, mostly digital in nature, will complete the shift
begun by the Internet away to a new era where the precepts of Moore’s Law can be applied to
virtually any field.¶ Computer-assisted design and fabrication will reshape manufacturing forever. These
technologies will slash waste and replace nearly all conventional manufacturing with more environmentally friendly and cost-effective additive
manufacturing run with robots and computer programs. Complex systems resistant to modeling will succumb to advances in big data that allow
mankind to finally make sense and improve upon the most intricate multi-faceted interactions. Where big data fails, ubiquitous
crowd
sourcing will harness untapped brain cycles to train systems and solve problems, one small activity at
a time — on a global scale.¶ In this massively digital world, A/B testing or parallelization of R&D processes will become
commonplace for just about everything from airline design simulations to online advertising to artificial organ construction. This
will, in turn, allow for far more rigorous testing of products and processes. Dirt-cheap digital delivery platforms for
educational content and improvements in the understanding of the way the brain learns will yield a sea
change in how we gain knowledge. This will result in more open, flexible educational systems and structures — and a
smarter, more learned, constantly learning populace. While the world will benefit from these changes, the United
States is uniquely positioned to lead this sea change.
A2: Addons
Ebola
Containment solves
Katie Jennings 14, Business Insider, citing Dr. Amesh Adalja, an infectious disease specialist from the
University of Pittsburgh Medical Center and the Center for Health Security, Aug 4 2014, “Here's Why
Your Panic Over Ebola Patients In The US Is Overblown,” http://www.businessinsider.com/why-ebolapanic-is-overblown-2014-8
A quick scan of recent headlines — "Ebola outbreak moving faster than efforts to contain it" or "Nigeria death shows Ebola can spread by air travel "— makes
it easy to jump to the conclusion that bringing Ebola patients to the United States is risky and could
cause a similar outbreak here. However, U.S. government officials and health experts say this is simply not true: Ebola will not
spread through the United States like it has in West Africa. "[T]he plain truth is that we can stop Ebola," Dr. Tom Frieden, director of the U.S. Centers for Disease
Control and Prevention told ABC's "This Week." "We know how to control it." Don't Believe Everything You See In The Movies Part of the fear about an Ebola outbreak in the U.S. stems from
how the virus has been treated by Hollywood and the media. "Ebola has a mystique about it because the way that it has been treated in fiction," Dr. Amesh Adalja, an infectious disease
specialist from the University of Pittsburgh Medical Center and the Center for Health Security, told Business Insider. He specifically referenced the 1995 movie "Outbreak," starring Cuba
Gooding, Jr., which features a fictional Ebola-like virus. Richard Preston's book The Hot Zone, a terrifying nonfiction thriller that inspired the movie, is another well-known reference. While
fictional stories just aren't true-to-life, there are a few legitimately scary things about Ebola. The symptoms are viscerally horrifying, and
treatments and vaccines
against the disease don't exist at this time. And because scientists aren't totally sure how the virus outbreaks jump to humans, there is also the fear of the unknown.
"The outbreaks are mysterious, they appear out of nowhere, they're explosive and then they disappear," says Adalja. All of these factors work to fuel a panic mentality. But in the
United States, Canada, Europe, and most countries with well-developed health care systems, Ebola
poses almost no real risk, because patients can be isolated and treated without spreading the virus.
Don't Panic: The Virus Doesn't Spread Very Efficiently Ebola "doesn't spread very efficiently through humans," says Adalja. While the virus is
deadly, it's not very contagious. Unlike the common cold or the flu, which spreads through airborne droplets, Ebola can only spread through contact with bodily
fluids, like blood, vomit, and diarrhea. Adalja also points out that Ebola is less contagious than Middle East Respiratory Syndrome, or MERS, which recently
arrived in the United States but was contained . No secondary cases, meaning new cases spread by the individuals who had arrived to the country
already infected, were reported. "
Ebola is a very rare disease that infects a very small number of people ," says Adalja. "It doesn't have that same type of
burden of illness of other diseases like malaria, tuberculosis, HIV."
No risk and alt cause — bodily fluids are necessary and poor living condition increase
the risk.
Forbes 14 — Robert Glatter, 2014 (“Could Ebola Virus Become A Threat In The U.S.?,” July 29th,
Available Online at http://www.forbes.com/sites/robertglatter/2014/07/29/could-ebola-virus-becomea-threat-in-the-u-s/, Accessed on 07-10-15)
Media reports on the death of a Liberian traveler in Lagos, Nigeria, due to the deadly Ebola virus have
caught the world’s attention–and for good reason. As we live in an interconnected world we have to
come to grips with the fact that hopping on a plane may potentially spread any virus–not just Ebola–to
another country. Thus, the importance of enforcing proper infectious screening procedures of departing
air travelers in an endemic area such as West Africa becomes critical to containing the spread of the
Ebola virus. Enforcing a “Do Not Board List” is critical to preventing the spread of such a virus. While
the Ebola virus could potentially be transported by travelers to another country by a plane ride,
according to officials at the CDC, the actual chance of it developing into a serious public health risk in
the U.S. is small. Poor and crowded living conditions, along with improper sanitation, seem to be an
important element in the spread of the virus. These are not the living conditions, in general,
throughout most modernized countries in the Western world. Ebola, comprised of 5 strains, was first
identified in 1976 in the Western Democratic Congo along the Ebola river. Four of the strains can be
spread to humans. The fifth resides only in primates. The fruit bat, considered a delicacy in West Africa,
is typically considered a natural reservoir of the Ebola virus. Ebola is spread directly, human-to-human,
by secretions such as saliva and sweat, but also by blood and feces. It can be spread directly by a
break in the skin or mucous membranes or indirectly after touching your nose, mouth or eyes after
having contact with the virus. It is not transmitted by coughing or sneezing (droplet spread), as would
be the case for someone with influenza or measles.
No extinction or epidemic
Science Alert 10/9/2014, citing Lauren Anciel Meyers, Professor of Integrative Biology at The
University of Texas at Austin, PhD in Biological Sciences from Stanford, and Tom Frieden, Director of the
CDC, “How infectious is Ebola?,” http://www.sciencealert.com.au/news/20140910-26305.html
So there’s a case of Ebola in the US, and the disease has already killed 70 percent of those it infected in
West Africa. Is this the beginning of the end for humanity? Not even close , and here’s why.¶ The US case of Ebola
is the first to be identified outside of Africa. The patient, who has now died from the disease, didn’t know that he was infected straight away, so wasn’t
quarantined by the Texas Health Presbyterian Hospital in Dallas for four days. This sounds like a long time to be walking around being contagious, but medical authorities have assured the
public not to panic.¶ In fact, officials seem pretty sure that
this particular case would not lead to an outbreak in the US. "I have no doubt that we
will control this importation, or case, of Ebola so that it does not spread widely in this country ," director of the Centers for Disease
Control and Prevention (CDC) Tom Frieden told the press earlier this week. ¶ Professor of integrative biology Lauren Ancel Meyers from the University of
Texas agreed, telling The Huffington Post science editor David Freeman, "I think they are striking a good note in saying that most of you out there don’t have to worry. There
doesn’t seem to be a real threat of a large epidemic in the United States."¶ The reason for Frieden’s and Meyers's
confidence is a simple mathematical term known as R0. This is a 'reproduction number' used by epidemiologists to indicate
how infectious a specific disease is. It tells you how many people, on average, will be infected by one
patient. ¶ "The reproduction number provides a lot of information," Meyers told The Huffington Post. "It gives us a baseline for projecting the growth of outbreaks in the absence of
intervention, and it tells us how hard and how effective do our interventions have to be in order to stop an epidemic."¶ Measles, for example, is the most contagious
disease we have, and its R0 is about 18. This means that if no one is vaccinated, an incredible 18 people can be infected by every one person who has the disease. Of course,
this number drops to zero if everyone is vaccinated. For HIV/AIDS and SARS, the R0 number is between 2 and 5, and for Ebola, it’s just 2 . ¶ According to Michaeleen Doucleff
at NPR, while many factors influence a disease’s reproduction number, the fact that Ebola’s is transmitted via bodily fluids, rather than the air, is probably why it’s rated so low. And
because Ebola isn't contagious until the patient starts showing symptoms - at which point the Dallas patient had checked
himself in to the hospital - all that needed to be done to contain the spread of the disease in the US is to isolate anyone
at the hospital who might have been infected .¶ CNBC reports that as of yesterday, none of the 48 people who potentially came in contact with Dallas
patient have developed any definite symptoms.¶ "
Then R0 drops to zero . And Texas is free of Ebola,” says Doucleff.
Ebola doesn’t cause extinction — too hard to catch and it’s danger is ramped up by
fearmongering.
The Washington Post 14 — Abby Ohlheiser, writer for the Post, 2014 (“It’s highly unlikely that
you’ll become infected with Ebola. So what are you so afraid of?,” October 5th, Available Online at
http://www.washingtonpost.com/news/to-your-health/wp/2014/10/05/nothing-to-fear-but-ebolaitself/, Accessed on 07-10-15)
This is how to get Ebola: Come into direct contact with the bodily fluids of a person who is infected
with the virus and already symptomatic. Ebola doesn't travel through the air. A person in Washington,
D.C., can't catch Ebola from an Ebola-infected person in Dallas without going there and coming into
direct contact with the patient's bodily fluids. Still, amid the deadliest Ebola outbreak in history, in
West Africa, the news of the first case diagnosed in the United States has prompted people to act as if
they're a half-breath away from catching the virus anyway. America's Patient Zero is in Texas. He's in
isolation, and the people who were in an apartment with him when he became sick are under
quarantine. None of the people who potentially came into contact with the man while he was
symptomatic have yet become sick with Ebola. Multiple potential U.S. cases elsewhere — from New
York to Washington — have come up negative. The virus has not ravaged the United States. But the
word — Ebola! — is ubiquitous, and so is the fear that comes with it. As The Post noted today in a
front-page story about the global health disaster: "This is both a biological plague and a psychological
one, and fear can spread even faster than the virus." An example, from Wednesday: Mehmet Oz — aka
Dr. Oz — went on television to pronounce that the epidemic could alter the world "as much as any
plague in history." Dr. Oz's apocalyptic statement depended not on the realities of the disease as it
exists now, but, he said, on "the question no one wants to ask, but everyone fears": Will the Ebola virus
mutate and go airborne? Cue a terrifying segment during which little blips on a spinning globe turned
the world red with disease. The doomsday potential is "a question that keeps [experts] up at night,"
Dr. Oz said, adding: "It should keep you up as well." But should it? "People are feeling out of control.
They had no control about whether Ebola comes to the United States," David Kaplan of the American
Counseling Association said last week. For Americans, Kaplan said, there's a cultural imperative to gain
and maintain control of one's own health and safety — an imperative that something like Ebola
confounds. "We always like to feel in control of what we do," he said. "That's why people are often
much more afraid of flying than of driving, even though it is much safer." Even if the threat of
something like Ebola is minuscule or remote, hysterical media coverage, Kaplan argued, can lead us to
"develop a cognitive bias that things occur more frequently than they actually do."
No Impact to an Ebola outbreak — we’re more prepared, it’s dying down, and it’s very
difficult to transmit.
Walsh 14 — Bryan Walsh, foreign editor at TIME, 2014 (“Why Ebola Isn’t Really a Threat to the U.S.,”
Time Magazine, October 21st, Available Online at http://time.com/3525385/ebola-threat-us-cdc/,
Accessed on 07-10-15)
Give us this—when Americans overreact, we do it all the way. Over the past week, in response to fears
of Ebola, parents in Mississippi pulled their children out of a middle school after finding out that its
principal had traveled to Zambia—a nation that is in Africa, but one that hasn’t recorded a single
Ebola case. A college sent rejection notices to some applicants from Nigeria because the school
wouldn’t accept “international students from countries with confirmed Ebola cases”—even though
Nigeria has had less than 20 confirmed cases and the outbreak is effectively over. The American public
is following its leaders, who’ve come down with a bad case of Ebola hysteria. That’s how you get eventempered politicians like New York Governor Andrew Cuomo musing that the U.S. should “seriously
consider” a travel ban on West African countries hit by Ebola, while some of his less restrained
colleagues raise the incredibly far-fetched possibility of a terrorist group intentionally sending Ebolainfected refugees into the U.S. It’s little surprise that a Washington Post/ABC News poll found that
two-thirds of Americans are concerned about an Ebola outbreak in the U.S. They shouldn’t be—and
two events that happened on Monday show why. WHO officials declared Nigeria officially “Ebola-free.”
And in Dallas, the first wave of people being monitored because they had direct contact with Thomas
Eric Duncan, the first Ebola patient diagnosed in the U.S., were declared free of the diseases. Nigeria
matters because the nation’s is Africa’s most populous, with 160 million people. Its main city, Lagos, is a
sprawling, densely populated metropolis of more than 20 million. Nigeria’s public health system is far
from the best in the world. Epidemiologists have nightmares about Ebola spreading unchecked in a city
like Lagos, where there’s enough human tinder to burn indefinitely. Yet after a few cases connected to
Sawyer, Nigeria managed to stop Ebola’s spread thanks to solid preparation before the first case, a quick
move to declare an emergency, and good management of public anxiety. A country with a per-capita
GDP of $2,700—19 times less than the U.S.—proved it could handle Ebola. As Dr. Faisal Shuaib of
Nigeria’s Ebola Emergency Operation Center told TIME: “ There is no alternative to preparedness.” But
Nigeria’s success was also a reminder of this basic fact: If caught in time, Ebola is not that difficult to
control, largely because it remains very difficult to transmit outside a hospital. For all the panic in the
U.S. over Ebola, there has yet to be a case transmitted in the community. The fact that two health
workers who cared for Duncan contracted the disease demonstrates that something was wrong with the
treatment protocol put out by the Centers for Disease Control and Prevention (CDC)—something CDC
Director Dr. Tom Frieden has essentially admitted—and may indicate that the way an Ebola patient is
cared for in a developed world hospital may actually put doctors and nurses at greater risk.
Small Business
Cloud computing is inefficient hurts small business.
Wilson 14 — Dean Wilson, writer for TechRadar, 2014 (“Cloud 'sprawl' causing business
inefficiencies,” March 18th, Available Online at http://www.techradar.com/us/news/internet/cloudservices/cloud-sprawl-causing-business-inefficiencies-1234913, Accessed on 07-10-15)
The growing use of a wide variety of unsanctioned cloud services, the so-called "cloud sprawl," is
causing significant problems for businesses, according to a new survey. Avanade, an Accenture and
Microsoft joint IT consultancy firm, released a report that shows 61 per cent of companies across the
globe blame cloud sprawl for causing inefficiencies in their business. That number falls to 52 per cent
in the UK, but it rises to 71 per cent among those using both public and private clouds. The survey
involved 750 IT decision makers in United States, United Kingdom, Germany, China, France, Sweden,
Brazil, Japan and Australia. The problem is that employees are signing up to cloud services that are
different to the ones provided by their own IT department, so instead of homogenisation there is
growing disparity between what each individual employee is using. 66 per cent of IT decision markers
across the globe have noticed this problem. The number climbs to 69 per cent in the UK. "The study
reinforces what we're seeing in the UK market about the challenges of cloud computing. Whilst the
cloud can deliver significant benefits, some of its advantages also introduce risk. Unmanaged cloud
sprawl in Shadow IT (Dark Cloud) is introducing risk with threats from unmanaged sources," said Mark
Corley, CTO at Avanade UK. "Cloud services are becoming available in increasing variety and ease of
access, and many IT departments simply can't keep up."
Warming
Cloud computing isn’t fast enough to solve for climate change
Foster 11, (Pete, "Cloud computing – a green opportunity or climate change risk?", Guardian, 8-12011, http://www.theguardian.com/sustainable-business/cloud-computing-climate-change)
But cloud computing comes with its own issues of security and reliability. Companies are often
reluctant to trust their data and computing to a remote supplier and climate change itself may make
cloud computing less attractive. The Foresight Programme from the UK's Government Office for
Science produces in-depth studies looking at major issues 20-80 years in the future. It recently published a
report on the International Dimensions of Climate Change that identifies a significant vulnerability from cloud computing. As more data
centres are needed, and with the UK a relatively expensive location, more will be going offshore, but
that makes them potentially more vulnerable to climate change impacts. The report points out that data
storage facilities have already suffered from flooding and cites the Vodafone data centre in Ikitelli, Turkey, which was
putting a quarter of the local network at risk . Similarly, in August 2009 the rainfall from
led to several submarine
landslides which broke at least nine communications cables 4000m down. It disrupted the Internet
and telecommunications between Taiwan, China, Hong Kong and other parts of Southeast Asia. The
study also makes the point that over 95% of global communications traffic is handled by just one million
kilometres of undersea fibre-optic cable. Rising sea levels increase the risk of flooding of coastal cable
facilities and may also affect the stability of the seabed, making cables more vulnerable. It makes worrying
reading. While we are all fighting to try and minimise climate change, we're already too far down the
affected by flash flooding in 2009,
Typhoon Morakot caused rivers to flood in Taiwan flushing large volumes of sediment into the ocean. This
road to stop some of the inevitable impacts . It's ironic that one IT trend that could help reduce
greenhouse gas emissions – cloud computing – may well itself be a victim of the impact.
Warming doesn't cause extinction
Bjørn Lomborg, an adjunct professor at the Copenhagen Business School, founded and directs the
Copenhagen Consensus Center, Project Syndicate, February 14, 2014, "The Davos Apocalypse",
http://www.project-syndicate.org/commentary/bj-rn-lomborg-criticizes-global-leaders-for-creating-anatmosphere-of-panic-about-climate-change
The apocalyptic bombast is even more disturbing. According to Angel Gurría, Secretary-General of the
OECD, “our planet is warming dangerously,” and we need to act now “to avoid catastrophe”; the United
Nations climate chief, Christiana Figueres, maintains that global warming means that “the world
economy is at risk.” Former UN Secretary-General Kofi Annan takes the prize for the most extreme
rhetoric, claiming that not curbing global warming is “a terrible gamble with the future of the planet and
with life itself.” Yet, the rhetoric is unconvincing. Yes, global warming is real and man-made. But
creating panic and proposing unrealistic policies will not help in tackling the problem. Both Annan and
Gurría cited Typhoon Haiyan in the Philippines last November as evidence of increased climate-changerelated damage. Never mind that the latest report by the UN Intergovernmental Panel on Climate
Change (IPCC) found that “current datasets indicate no significant observed trends in global tropical
cyclone frequency over the past century” and reported “low confidence” that any changes in hurricanes
in recent (or future) decades had anything to do with global warming. Annan and Gurría also neglected
to note that global Accumulated Cyclone Energy, an index for total hurricane activity, is hovering at the
lowest values seen since the 1970’s. Indeed, the trend for strong hurricanes around the Philippines has
declined since 1951. Similarly, Gurría tells us that Hurricane Sandy, which slammed into New York City in
2012, is an example of inaction on climate change, costing the United States “the equivalent of 0.5% of
its GDP” each year. In fact, the US currently is experiencing the longest absence of intense landfall
hurricanes since records began in 1900, while the adjusted damage cost for the US during this period,
including Hurricane Sandy, has fallen slightly. Figueres claims “that current annual losses worldwide due
to extreme weather and disasters could be a staggering 12% of annual global GDP.” But the study she
cites shows only a possible loss of 1-12% of GDP in the future, and this is estimated not globally but
within just eight carefully selected, climate-vulnerable regions or cities. By contrast, according to the
IPCC, “long-term trends in economic disaster losses adjusted for wealth and population increases have
not been attributed to climate change.” On the contrary, the bulk of peer-reviewed economic evidence
indicates that, up to around 2050-2070, the net global economic impact of rising temperatures is likely
to be positive. Although global warming will create costs stemming from more heat-related deaths and
water stress, they will be outweighed by the benefits from many fewer cold-related deaths and higher
agricultural productivity from higher levels of CO2. Global warming is a long-term problem. Most models
indicate that the cost toward the end of the century will be 1-5% of world GDP. This is not a trivial loss;
but nor does it put “the world economy at risk.” For comparison, the IPCC expects that by the end of the
century, the average person in the developing world will be 1,400-1,800% richer than today. Such
incorrect statements by leading officials reinforce wasteful policies based on wishful thinking. Figueres
sees “momentum growing toward” climate policies as countries like China “reduce coal use.” In the real
world, China accounts for almost 60% of the global increase in coal consumption from 2012 to 2014,
according to the International Energy Agency. While Figueres lauds China for dramatically increasing its
solar-power capacity in 2013, the increase in China’s reliance on coal power was 27 times greater.
Figueres’s weak grasp on the facts has led her not only to conclude that China is “doing it right” on
climate change, but also to speculate that China has succeeded because its “political system avoids
some of the legislative hurdles seen in countries including the US.” In other words, the UN’s top climate
official seems to be suggesting that an authoritarian political system is better for the planet. The fact
remains that global wind and solar power usage in 2012 cut, at most, 275 million tons of CO2, while
soaking up $60 billion in subsidies. With the electricity worth possibly $10 billion, the average cost of
cutting a ton of CO2 is about $180. The biggest peer-reviewed estimate of the damage cost of CO2 is
about $5 per ton. This means that solar and wind power avoid about $0.03 of climate damage for every
dollar spent. Compare this to smarter technological solutions. In the short run, the US shale-energy
revolution has replaced high-polluting coal with cheaper, cleaner natural gas. This has cut about 300
million tons of US emissions – more than all the world’s solar and wind power combined – and at the
same time has profited Americans by saving them $100 billion in energy costs. In the long run, current
investment in green research and development will help drive the price of future renewable energy
below that of fossil fuels, enabling a choice that is both environmentally and economically sound. In the
meantime, even dramatic cuts in CO2 emissions will have very little impact on hurricanes 50-100 years
from now. Lifting billions of people out of poverty, however, would not only be intrinsically good; it
would also make societies much more resilient in the face of extreme weather, whether caused by
global warming or not.
No impact to warming—recent studies
Condie 4/23, (Bill, editor, journalist for more than 30 years, working as a writer and editor in Europe,
Asia and Australia for newspapers including The Guardian, The Observer and The Times, "Warming
'slowdown' has no impact on longer term climate trends", Cosmos Newsblog, 4-23-2015,
http://blog.cosmosmagazine.com/blog/2015/4/23/warming-slowdown-has-no-impact-on-longer-termclimate-trends)
The recent slowdown in the rise of global average air temperatures will make no difference to how
much the planet will warm by 2100, a new study has found. " The slowdown in global warming has no
bearing on long-term projections – it is simply due to decadal variability. Greenhouse gases will
eventually overwhelm this natural fluctuation,” said lead author and Chief Investigator with the ARC
Centre of Excellence for Climate System Science, Prof Matthew England. The study, published today in Nature
Climate Change,
compared climate models that capture the current slowdown in warming to those that do
not. The study found that long-term warming projections up to 2100 were effectively unchanged
across the two groups of models. “Our research shows that while there may be short-term fluctuations in
global average temperatures, long-term warming of the planet is an inevitable consequence of
increasing greenhouse gas concentrations,” Prof England said. “This much hyped global warming
slowdown is just a distraction to the task at hand”. The models were analysed using one of two IPCC carbon emission
projections. The first was a scenario where greenhouse gas concentrations continue to rise unabated through the
21st Century. The second assumes emissions are reduced to address global warming, peaking by 2040
before declining sharply. Under the high emissions scenario, the difference in average projected endof-century warming between the two groups of models is less than 0.1°C . Warming of this magnitude
is well beyond the 2°C threshold that is considered a target by the
IPCC.
Australian Government and a safe limit by the
Some lobby groups have tried to argue that the recent slowdown in the rise of global average temperatures is a reason to abandon
international and national efforts to curb carbon emissions. Cosmos has reported on several reasons for the apparent slowdown, including the
behaviour of winds in the Pacific Ocean. See Has global warming paused.
6 degree warming inevitable---massively outweighs aff solvency
AP 9 (Associated Press, Six Degree Temperature Rise by 2100 is Inevitable: UNEP, September 24,
http://www.speedy-fit.co.uk/index2.php?option=com_content&do_pdf=1&id=168)
Earth's temperature is likely to jump six degrees between now and the end of the century even if
every country cuts greenhouse gas emissions as proposed, according to a United Nations update. Scientists looked at
emission plans from 192 nations and calculated what would happen to global warming. The projections take into account 80
percent emission cuts from the U.S. and Europe by 2050, which are not sure things. The U.S. figure is based on
a bill that passed the House of Representatives but is running into resistance in the Senate, where debate has been delayed by health care
reform efforts. Carbon dioxide, mostly from the burning of fossil fuels such as coal and oil, is the main cause of global warming, trapping the
sun's energy in the atmosphere. The world's average temperature has already risen 1.4 degrees since the 19th century. Much
of
projected rise in temperature is because of developing nations, which aren't talking much about
cutting their emissions, scientists said at a United Nations press conference Thursday. China alone adds nearly 2 degrees to
the projections. "We are headed toward very serious changes in our planet," said Achim Steiner, head of the U.N.'s environment
program, which issued the update on Thursday. The review looked at some 400 peer-reviewed papers on climate over the last three years.
Even if the developed world cuts its emissions by 80 percent and the developing world cuts theirs in
half by 2050, as some experts propose, the world is still facing a 3-degree increase by the end of the century,
said Robert Corell, a prominent U.S. climate scientist who helped oversee the update. Corell said the most likely agreement out of the
international climate negotiations in Copenhagen in December still translates into a nearly 5-degree increase in world temperature by the end
of the century. European leaders and the Obama White House have set a goal to limit warming to just a couple degrees. The U.N.'s
environment program unveiled the update on peer-reviewed climate change science to tell diplomats how hot the planet is getting. The last big
report from the Nobel Prize-winning Intergovernmental Panel on Climate Change came out more than two years ago and is based on science
Global warming is speeding up, especially in the Arctic, and that means
science projections from 2007 are already out of date and overly optimistic . Corell, who
headed an assessment of warming in the Arctic, said global warming "is accelerating in ways that we are not anticipating." Because
Greenland and West Antarctic ice sheets are melting far faster than thought, it looks like the seas will rise
twice as fast as projected just three years ago, Corell said. He said seas should rise about a foot every 20 to 25
years.
that is at least three to four years old, Steiner said.
that some top-level
Mosaic Theory Advantage
Impact Answers
Privacy (Also See Freedom Act Neg)
Counter-bias – their epistemology’s more flawed. Excess fear of surveillance means Aff
scholarship’s MORE of an exaggeration than ours.
McDonough ’15 (Shannon McDonough – Instructor in Social Sciences at Allen University. The author holds a B.A. in
Sociology from Miami University, Ohio and an M.A. Sociology from The University of South Carolina. This article is co-authored
by Mathieu Deflem – a Professor at the University of South Carolina in the Department of Sociology. His research areas include
law, policing, terrorism, popular culture, and sociological theory. “The Fear of Counterterrorism: Surveillance and Civil Liberties
Since 9/11” – From the Journal: Society - February 2015, Volume 52, Issue 1, pp 70-79 – obtained via the Springer database
collection).
Civil liberties organizations as well as a number of academic scholars have routinely criticized post-9/11
counterterrorism initiatives as unconstitutional and major threats to civil liberties and privacy. Harmonizing with the claims from civil
liberties groups are contributions in the popular and scholarly discourse on surveillance and counterterrorism that lament the
purported negative impact of government al policies and related surveillance and intelligence activities on personal rights and
liberties. The revelations by former security contractor Edward Snowden in June 2013 concerning alleged spying practices by the
National Security Agency (NSA) greatly reinvigorated these debates. We investigate here if there is any counterevidence to the alarmist statements that are often made in the popular and scholarly discourse on civil
liberties and surveillance. Against the background of academic scholarship on surveillance and criticisms from civil liberty and privacy groups, we
rely on archival sources, government documents, and media reports to examine a variety of claims made concerning civil
liberties violations by security
agencies. Our analysis reveals that at least a sizeable number of claims raised
against counterterrorism practices are without objective foundation in terms of any actual violations. As
an explanation for this marked discrepancy, we suggest that, as
not entirely stable,
various survey data show, there is a relatively distinct , albeit it uneven and
culture of privacy and civil liberties in contemporary American society which
independently contributes to a fear of counterterror ism, rather than of terrorism . These specific cultural
sensitivities bring about an increase in the amount of civil rights allegations independent of actual violations
thereof.
Rights can’t be absolute – as they sometimes conflict with other “rights”. If some
rights were absolute, privacy wouldn’t be one of them.
Himma ‘7 (Kenneth - Associate Professor of Philosophy, Seattle Pacific University. The author holds JD
and PhD and was formerly a Lecturer at the University of Washington in Department of Philosophy, the
Information School, and the Law School. “Privacy vs. Security: Why Privacy is Not an Absolute Value or
Right”. San Diego Law Review, Vol. 44, p. 859, 2007. Available at SSRN:
http://ssrn.com/abstract=994458)
It is perhaps worth noting that absolutist conceptions are not limited to privacy rights. Some people take the position that the
moral right to life is absolute; on an absolutist conception of the right to life, it is never justified to take the life of a person—and this rules out not only the death
penalty, but the use of deadly force in defense of the lives of innocent others from a culpable attack. Many people take an absolutist view with respect to something
they call a “right to information,” holding that there should be no restrictions of any kind, including legal protection of intellectual property rights, on the free flow
of information. As this view has most famously, and idiosyncratically, been put by John Perry Barlow, “information wants to be free.”5 When it comes to rights,
absolutist talk among theorists, lawyers, and ordinary folk is not at all uncommon these days. Indeed,
nature, absolute and hence that it is a conceptual truth that
some people seem to think that rights are, by
all rights are absolute. Consider the following quote from Patrick Murphy, a Democrat
who ran for Congress in 2006: I am also very concerned about the erosion of constitutional rights and civil liberties over the past few years. I taught Constitutional
Law at West Point, and it makes me so angry to see our elected leaders in Washington—specifically the White House and the Republican leadership in Congress—
pushing policies that erode the foundation of this country. The equal protection clause of the constitution is absolute. The right to privacy is absolute. The right to
assemble is absolute. Yet time and time again, the administration has supported, and the Congressional leadership has supported nominees and policies that do not
follow the constitution. With my background, I can add to this debate. And I’m not afraid to take a stand for what’s right.6 As Murphy explains it, every right in the
Constitution is absolute and hence utterly without exception. As there is nothing in the Constitution or any legal instrument or norm that suggests or entails that
constitutional rights are absolute, it is reasonable to think that Murphy believes, as many people do, that it is part of the very meaning of having a right that it can
never justifiably be infringed. This is why debates about political issues are frequently framed in terms of whether there is some right that protects the relevant
interests; rights provide the strongest level of moral or legal protection of the relevant interests. It is certainly true that rights provide a higher level of protection
than any other considerations that are morally relevant, but it is not because rights are, by nature, absolute. Rights provide robust protection of the relevant
interests because it is a conceptual truth that the infringement of any right cannot be justified by an appeal of the desirable consequences of doing so. No matter
how many people it might make happy, it would be wrong to intentionally kill an innocent person because her right to life takes precedence over the interests of
other people in their own happiness. As Ronald Dworkin famously puts this conceptual point, rights trump consequences.7 But this conceptual truth about rights
does not imply rights are, by nature, absolute. The claim that rights trump consequences implies only that some stronger consideration than the desirable
there is some such consideration that
would justify infringing some rights. One such candidate, of course, is the existence of other more
important rights. It is commonly thought that at least some rights are commensurable and can be ranked in a hierarchy that expresses the relative weight
each right in the hierarchy has with respect to other rights. For example, one might think that the right to life is at the top of the
hierarchy of commensurable rights, and that property rights are in this hierarchy also. This would explain the common intuition
that one may use deadly force when necessary to defend innocent lives from culpable attack, but not when
consequences of infringing a right can justify doing so. This latter claim leaves open the possibility that
necessary only to defend property rights from violation. If, as seems clear from this example, it is possible for two rights to conflict and for one to outweigh the
other, it follows that rights are not, by nature, absolute. What may explain the mistaken view that rights are necessarily absolute is confusion about the relationship
of various terms that flesh out the status, origin, and contours of moral rights and obligations. For example, rights
are frequently described as
“inviolable,” meaning that a right can never be justifiably violated. This, of course, is a conceptual truth; to say that a right is violated is to say that its
infringement is without justification. But this does not imply that rights can never be justifiably infringed; a person’s
right to life can be justifiably infringed if he (they) culpably shoots at an innocent person and there is no
other way to save that person’s life except through use of lethal force in defense of his life. Rights are also thought, by
nature, to be supreme, relative to some system of norms—moral, social, or legal—in the sense that they cannot be defeated by other kinds of protections; moral
rights are thought to be supreme over all other kinds of considerations, including social and legal rights. But
this does not imply that rights
are absolute because it says nothing about the relative importance of one right to another ; it simply
asserts that, by nature, rights outweigh all other relevant considerations. Supremacy and inviolability are part of the very nature of a
right, but these properties do not entail that rights are, by nature, absolute. Of course, the negation of the claim that all rights are absolute does not imply that no
rights are absolute. The possibility of conflicts between any two rights does not preclude there being one right that wins every conflict because it is absolute, and
hence, without exception. A moral pacifist, for example, takes this view of the moral right to life and holds that intentional killing of a human being is always wrong.
Moreover, if there are two rights that do not come into conflict with each other and win in conflicts with all other rights, those two rights might be absolute. One
might think, for example, that the rights to privacy and life can never conflict and that both are absolute. I
absolute in this strong sense, but if there are any, it will not be privacy.
am somewhat skeptical that any right is
As we will see in more detail, privacy is commensurable with
other rights, like the right to life, which figures into the right to security. It seems clear that privacy rights and the right to life can come into conflict. For
example, a psychologist might be justified in protecting a patient’s privacy interests even though
doing so includes information that might prevent that person from committing a minor property
crime of some kind, but she would not be justified in protecting that information if the psychologist knows its
disclosure is necessary to prevent a murder. In any event, I will discuss these kinds of examples in more detail below.
Why does the Debate community treat security interests as callous or mean ?Security
interests are competing rights claims that impact serous moral questions.
Himma ‘7 (Kenneth - Associate Professor of Philosophy, Seattle Pacific University. The author holds JD and PhD and was
formerly a Lecturer at the University of Washington in Department of Philosophy, the Information School, and the Law School.
“Privacy vs. Security: Why Privacy is Not an Absolute Value or Right”. San Diego Law Review, Vol. 44, p. 859, 2007. Available at
SSRN: http://ssrn.com/abstract=994458)
At the outset, it is important to stress that security interests do not embrace interests not immediately
related to the survival and minimal physiological well-being of the individual. My interest in security encompasses my
interest in continuing life, my interest in being free from the kind of physical injury that threatens my ability to provide for
myself, my interest in being free from the kind of financial injury that puts me in conditions of health- or life-threatening poverty, and my interest in
being free from psychological trauma inflicted by others that renders me unable to care for myself. My interest in
security is a negative one in the sense that it is protected by a moral right constituted, in part, by moral obligations owed to me by other
people to refrain from committing acts of violence or theft capable of causing serious threats to my health, well-
being, and life. While it is difficult to draw the line between a serious harm and a nonserious harm, it will have to suffice for my purposes to say that a
serious harm is one that interferes significantly with the daily activities that not only give my life meaning, but make it possible for me to continue to survive.
Significant trauma to the brain not only interferes with many activities that constitute what Don Marquis calls the “goodness of life,”19 but also
interferes with my ability to make a living teaching and writing philosophy—while a mildly bruised arm does not. Where
exactly to draw the line is not entirely clear, but for my purposes I do not think much turns on it as long as it is understood that security interests do not include
minor injuries of any kind. I imagine the boundaries of the relevant notion of seriousness are likely to be contested in any event, but all would agree that the
interest in security, by nature, protects only against threats of serious injuries.
It should be abundantly clear that morality protects
these interests in the strongest terms available to it. Unless one is a complete skeptic about morality and moral objectivity, little
argument is needed to show that we have a moral right to be free from acts that pose a high risk of
causing either our death or grievous injuries to our bodies. Moreover, I would hazard that non-skeptics about morality would also accept that
the moral right to physical security is sufficiently important that a state is, as a matter of political morality, obligated to protect it, by criminalizing attacks on it, as a
condition of its legitimacy. No state authority
that failed to protect this right could be morally legitimate; at the very least
interests are not, however,
just about our own well-being; they encompass the well-being of other persons whose activities conduce to our own
no state authority that failed to do so could be justified in claiming a legitimate monopoly over the use of force. Security
physical security. We are social beings who live in societies in which there is a pronounced division of labor that makes the security of one person dependent upon
the security of other persons in a variety of ways—some more abstract, some less abstract.
Assessing Utilitarian consequences are good. Putting ethics in a vacuum is morally
irresponsible.
Issac, ‘2 (Jeffery, Professor of Political Science at Indiana University, Dissent, Vol. 49 No. 2, Spring)
Politics, in large part, involves contests over the distribution and use of power. To accomplish anything in the political world one must attend to
the means that are necessary to bring it about. And to develop such means is to develop, and to exercise, power. To say this is not to say that
power is beyond morality. It is to say that power is not reducible to morality. As writers such as Niccolo Machiavelli, Max Weber, Reinhold
Niebuhr, Hannah Arendt have taught, an unyielding
concern with moral goodness undercuts political responsibility.
The concern may be morally laudable, reflecting a kind of personal integrity, but it suffers from three fatal flaws: (1) It fails to see that
the purity of one’s intentions does not ensure the achievement of what one intends. Abjuring violence or
refusing to make common cause with morally comprised parties may seem like the right thing, but if such tactics entail impotence,
then it is hard to view them as serving any moral good beyond the clean conscience of their supporters;
(2) it fails to see that in a world of real violence and injustice, moral purity is not simply a form of powerlessness, it
is often a form of complicity in injustice. This is why, from the standpoint of politics-as opposed to religion-pacifism is always a
potentially immoral stand. In categorically repudiating violence, it refuses in principle to oppose certain violent injustices with any effect; and
(3)
it fails to see that politics is as much about unintended consequences as it is about intentions; it is the
effects of action, rather than the motives of action, that is most significant. Just as the alignment with “good” may
engender impotence, it is often the pursuit of “good” that generates evil. This is the lesson of communism in
the twentieth century: it is not enough that one’s goals be sincere or idealistic; it is equally important,
always, to ask about the effects of pursuing these goals and to judge these effects in pragmatic and
historically contextualized ways. Moral absolutism inhibits this judgment. It alienates those who are not true believers. It
promotes arrogance. And it undermines political effectiveness.
Alt cause – corporate privacy infringements are far worse and the public readily
accepts it.
Lewis ’14 (James Andrew Lewis is a senior fellow and director of the Strategic Technologies Program at
the Center for Strategic and International Studies in Washington, D.C., where he writes on technology,
security, and the international economy. Before joining CSIS, he worked at the US Departments of State
and Commerce as a Foreign Service officer and as a member of the Senior Executive Service. His
diplomatic experience included negotiations on military basing in Asia, the Cambodia peace process, and
the five-power talks on arms transfer restraint. Lewis received his Ph.D. from the University of Chicago.
“Underestimating Risk in the Surveillance Debate” - CENTER FOR STRATEGIC & INTERNATIONAL STUDIES
- STRATEGIC TECHNOLOGIES PROGRAM – December - http://csis.org/publication/underestimating-risksurveillance-debate)
Some of the unhappiness created by the Edward Snowden leaks reflects the unspoken recognition that online privacy has changed
irrevocably. The precipitous decline in privacy since the Internet was commercialized is the elephant in the
room we ignore in the surveillance debate. America’s privacy laws are both limited in scope and out of date. Although a majority of
Americans believe privacy laws are inadequate, the surveillance debate has not led to a useful discussion of privacy in
the context of changed technologies and consumer preferences. Technology is more intrusive as companies pursue
revenue growth by harvesting user data. Tracking online behavior is a preferred business model. On average, there are 16 hidden
tracking programs on every website. The growing market for “big data” to predict consumer behavior and
target advertising will further change privacy. Judging by their behavior, Internet users are willing to
exchange private data for online services. A survey in a major European country found a majority of Internet users disapproved of Google
out of privacy concerns, but more than 80 percent used Google as their search engine. The disconnect between consumer statements
and behavior reduces the chances of legislating better protections.
Solvency
Congress Can’t Solve
Congress can’t keep up with speed of technology
Gatewood, 2014 (Jace C., Associate Professor of Law at Atlanta's John Marshall Law School, “District
of Columbia Jones and the Mosaic Theory - In Search of a Public Right of Privacy: The Equilibrium Effect
of the Mosaic Theory” Nebraska Law Review Lexis)
Nevertheless, the question that still remains is why the onus should be on the government, rather
than the courts or legislature, to determine the scope of the mosaic theory's reach. In other words,
why should not the courts or legislature provide specific guidance to law enforcement on the degree
of permissible intrusion that will be permitted by the use of specific technology? The simple answer is
that the courts and legislature cannot keep up with the speed of technology. n223 There is no fix-all
law that will address all current and future technological advances. By not articulating specific
standards in terms of how much information is too much or how long is too long to conduct
surveillance, the courts are free to address each new technological advance on a case-by-case basis to
determine if the necessary mosaic has been created. Law enforcement and privacy will best be served
and preserved if the government is forced to make critical decisions regarding the use and abuse of
advanced technology.
Expansion of Mosaic Theory Bad DA
Uniqueness – Court against Mosaic Now
Courts are not ruling on the Mosaic theory now
Bellovin et al, 2014 (Steven M., Prof of Computer Science @ Columbia, Renee M. Hutchins, Associate
Prof. of Law @ Maryland Francis King Carey School of Law, Tony Jebara, Associate Prof. of Computer
Science @ Columbia, and Sebastian Zimmeck, Ph D. Candidate in Computer Science @ Columbia, “When
Enough is Enough: Location Tracking, Mosaic Theory, and Machine Learning” New York University
Journal of Law & Liberty Lexis)
In the context of location tracking, the Court has previously suggested that the Fourth Amendment may (at some
theoretical threshold) be concerned with the accumulated information revealed by surveillance.3 Similarly,
in the Court’s recent decision in United States v. Jones, a majority of concurring justices indicated
willingness to explore such an approach.4 However, in general, the Court has rejected any notion that
technological enhancement matters to the constitutional treatment of location tracking.5 Rather, it has
decided that such surveillance in public spaces, which does not require physical trespass, is equivalent to a human tail and thus not regu-lated
by the Fourth Amendment. In this way, the Court has avoided a quantitative analysis of the amendment’s protections. The
Court’s
reticence is built on the enticingly direct assertion that objectivity under the mosaic theory is
impossible. This is true in large part because there has been no rationale yet offered to objectively
distinguish relatively short-term monitoring from its counterpart of greater duration.6 This article suggests
that by combining the lessons of machine learning with the mosaic theory and apply-ing the pairing to the Fourth Amendment we can see the
contours of a response. Machine learning makes clear that mosaics can be created. Moreover, there are important lessons to be learned on
when this is the case.c
Uniqueness – Sequential Approach
There is a sequential approach to the Fourth Amendment now
Kerr, 2012 (Orin S., Professor of Law @ George Washington University Law School “THE MOSAIC
THEORY OF THE FOURTH AMENDMENT” Michigan Law Review Lexis)
The five votes in favor of a mosaic approach in United States v. Jones do not establish the theory as a
matter of law. The majority opinion in Jones failed to adopt the mosaic approach, and it only touched on the mosaic method in passing to
express skepticism of it.187 Even if five votes of the current court are ready to embrace the theory, lower courts must adhere to Supreme Court
holdings even when subsequent developments suggest that the Supreme Court would reject those holdings if it reviewed them.188 For
now, then, the sequential approach remains good law. At the same time, the concurring opinions in
Jones invite lower courts to consider embracing some form of the mosaic approach. Our attention therefore
must turn to the normative question: Should courts embrace the mosaic theory? Is the mosaic approach a promising new method of Fourth
Amendment interpretation, or is it a mistake that should be avoided? This section argues that courts
should reject the mosaic
theory. The better course is to retain the traditional sequential approach to Fourth Amendment
analysis. The mosaic theory aims at a reasonable goal. Changing technology can outpace the assumptions of existing precedents, and courts
may need to tweak prior doctrine to restore the balance of privacy protection from an earlier age. I have called this process “equilibrium
adjustment,”189 and it is a longstanding method of interpreting the Fourth Amendment. But the mosaic theory aims to achieve this goal in a
very peculiar way.
Hurts Police (General)
Expansion of the Mosaic theory kills investigations – there are no limits, retroactivity,
and ensures court clog.
Ostrander, 2011 (Benjamin M. Candidate for JD @ Notre Dame Law School, “THE “MOSAIC THEORY”
AND FOURTH AMENDMENT LAW” Notre Dame Law Review Lexis)
Maynard left little guidance as to what durational threshold must to be crossed in order for the use of pattern-detecting
technology to be sufficiently prolonged as to render it a search.93 Without a clearly demarcated line, law enforcement
agents, judges, and individuals cannot know when an aggregate of information will receive Fourth
Amendment protection. Law enforcement agents are left to speculate as to how much is too much.94
This lack of clarity will deter law enforcement agents from utilizing the full extent of their
investigatory power . This is even more problematic with respect to the “mosaic theory’s” creation of
retroactive unconstitutionality.95 As soon as a pattern is created, previously permissible individual law
enforcement steps become unconstitutional. Because the “mosaic theory” retroactively renders the
entire mosaic unconstitutional and subject to suppression, law enforcement agents will be even more
hesitant in exercising the full extent of their investigatory power. Further, if the “mosaic theory” in the Fourth
Amendment is premised on the idea that “prolonged GPS monitoring reveals an intimate picture of the subject’s life that he expects no one to
have— short perhaps of his spouse,”96 who has the burden of proof with respect to whether the prolonged surveillance has in fact revealed an
intimate picture of an individual’s life and thus created a mosaic? Unless the location of a “stash-house” is an intimate detail, Maynard can be
read to stand for the proposition that warrantless prolonged GPS surveillance is per se unconstitutional. Such an approach would be overinclusive in that prolonged location monitoring that does not result in a pattern, or a pattern that does not reveal intimate details, would be
rendered a search within the meaning of the Fourth Amendment and therefore subject to suppression. Once the mosaic threshold is crossed
and a mosaic is created, the question that arises is to how to define the scope of the mosaic. If law enforcement officials engage in a number of
sustained investigatory techniques—as they often do—it is likely that whole investigations will be called into question. That is, if a pattern is
detected only through the use of multiple investigatory techniques, and the theory is applied consistently, the investigation in its entirety will
be rendered a search.97 In this respect, the retroactive effect of the “mosaic theory” takes on greater significance. Rather than having the
entire investigation held inadmissible and subject to suppression, law enforcement agents will be overly cautious as to the amount of
surveillance conducted. The
lack of clarity as to how prolonged the surveillance must be to render it a search,
whether intimate details need in fact emerge, and what the proper scope of the mosaic is will provide
defendants with an arsenal to attack every police investigation.
Mosaic theory kills effective law enforcement.
Bedi, 2014 (Monu, Assistant Professor, DePaul University College of Law, “SOCIAL NETWORKS,
GOVERNMENT SURVEILLANCE, AND THE FOURTH AMENDMENT MOSAIC THEORY” Boston University
Law Review Lexis)
The most troubling part of adopting the mosaic theory is that it requires the abandonment of, or dramatic
alterations to, the Doctrines. The basic problem is the inherent conflict between the first and second models of reasonable
expectation. While the Doctrines embrace a per se rule focusing solely on disclosure and why this vitiates privacy, the mosaic
theory rests on society’s opinion and what it deems reasonable.223 Consider the Public Disclosure
Doctrine. The fact that public movements are not protected under the Fourth Amendment is critical
to law enforcement investigations .224 Visual warrantless surveillance remains a central part of police
surveillance.225 It is not clear to what extent these practices will remain constitutional with the
introduction of the mosaic theory. For instance, it is common for officers to track vehicles and
aggregate information from various sources over a period of time.226 As Gray and Citron point out, the “mosaic
theory puts these practices and the line of doctrine endorsing them in obvious jeopardy, particularly
when officers are too successful and their investigations produce too much information.”227 This
danger is compounded by the fact that law enforcement may use a combination of visual and
technology-based surveillance (a la Knotts) when investigating a suspect. “How, after all,” ask Gray and Citron, “are we to
distinguish ‘between the supposed invasion of aggregation of data between GPS-augmented surveillance and a purely visual surveillance of
substantial length’?”228 It won’t do here to simply say that a specific duration of technology-dependent surveillance violates the expectation of
privacy. The
problem is that the Public Disclosure Doctrine treats all public movements the same,
regardless of how much information is disclosed or how long it is observed.229 To carve out exceptions
based on what society thinks is unreasonable leaves vulnerable investigative techniques that are
essential to effective law enforcement.
Using the mosaic theory hampers numerous investigative techniques.
Ostrander, 2011 (Benjamin M. Candidate for JD @ Notre Dame Law School, “THE “MOSAIC THEORY”
AND FOURTH AMENDMENT LAW” Notre Dame Law Review Lexis)
One of the most serious implications of the “mosaic theory” in Fourth Amendment law is that it calls into
question the validity of previously accepted forms of surveillance. GPS surveillance is not the only form of
surveillance that provides law enforcement with a comprehensive and detailed record of someone’s
movements or affairs when it is sustained on a prolonged basis. Thus, the “mosaic theory,” which focuses on the resulting
patterns created by individual law enforcement acts that in and of themselves are not searches, naturally calls into question other
accepted investigative techniques that are performed on a sufficiently prolonged basis.98 For instance, the
“mosaic theory” calls into question the use of pen registers99 and trap and trace devices,100 which have
been held to not implicate the Fourth Amendment.101 The “mosaic theory” would also seemingly implicate the prolonged use of a mail
cover 102 as an investigatory technique. 103 Although the Supreme Court has yet to address the issue, courts have held that the
warrantless use of a mail cover does not violate the Fourth Amendment.104 Another accepted investigatory technique that
can reveal very intimate details of an individual’s life— particularly if sustained for a prolonged
basis—is garbage inspections. 105 It could plausibly be argued that the patterns that result from the prolonged use of garbage
inspections are much more intrusive than any pattern resulting from the use of a GPS device.106 The same could be said about
prolonged video surveillance.107 It is well settled that video surveillance in public areas does not give
rise to a Fourth Amendment issue.108 Thus, video cameras may be placed outside of an individual’s residence, and so long as the
cameras are incapable of viewing the interior of the residence, no Fourth Amendment right is infringed upon.109 Since Maynard, the
“mosaic theory” has in fact been used as the basis for holding a previously accepted investigatory
technique a search. In In re Application of the United States of America for an Order Authorizing the Release of Historical Cell-Site
Information,110 Magistrate Judge Orenstein denied the government’s application for an order under the Stored Communications Act111
directing a service provider to disclose two months worth of historical cell-site location information. 112 According to Magistrate Judge
Orenstein: The Maynard court’s concern with sustained GPS tracking over the course of a month was not its formally continuous nature, but
rather the fact that it results in a vast collection of specific data points that, viewed together, convey the “intimate picture” of a subject’s life. It
is the ability to amass a collection of such points, and not the ability to trace the route from each one to the next, that carries with it the ability
to resolve those points into a comprehensible picture.113 Applying the “mosaic theory” to historical cell-site information, Magistrate Judge
Orenstein concluded that the Fourth Amendment required the government to obtain a warrant based on a showing of probable cause.114
The most significant implication of the “mosaic theory,” however, is that it calls into question the
governmental use of prolonged visual surveillance in criminal investigations.115 In Maynard, the court
addressed the issue of the possible extension of the “mosaic theory” to prolonged visual surveillance.116 Although the court ultimately
declined to decide whether such a situation would constitute a search under the new theory, it suggested that visual surveillance would not be
implicated.117 The
court noted that practically, law enforcement agents do not have the capability to
sustain visual monitoring for a duration that exposes information not revealed to the public.118 This
argument is unpersuasive to the extent that it suggests that a mosaic is only created if the whole of
one’s movements is captured. A pattern can be created, and thus intimate details revealed, by the
aggregation of individual law enforcement steps not necessarily constituting the whole of the
investigatory techniques employed. The court implicitly recognizes this, as even continuous GPS tracking of a vehicle does not
reveal the entirety of one’s movements, but rather only the movements of a particular vehicle. Further, the dismissal of the
implication of visual surveillance is problematic to the extent that it relies on the probability of law
enforcement success. Such probability, however, must be viewed in relation to the factual context in which the investigation is
conducted, and not in the abstract. To be sure, it is not beyond the realm of possibility that a properly equipped
and resourced law enforcement unit would be capable of monitoring an unsuspecting individual for a
continuous period of time sufficient to create a mosaic. As a theoretical matter, the court reasoned that in contrast to
prolonged GPS monitoring, the extension of the “mosaic theory” to visual surveillance would fail as the means used to uncover private
information would not defeat one’s expectation of privacy.119 The
court’s analogy to the distinction between the
placement of undercover agents and wiretapping120 overlooks the fact that here, warrantless GPS
tracking and visual surveillance are constitutional in the first instance. In fact, the “mosaic theory”
focuses on the nature of the information revealed —a pattern exposing intimate details— and does not focus on
the investigatory method used to attain such information. Beyond prolonged visual and video surveillance, Maynard
does not express a view as to whether other investigatory techniques would be called into question by the “mosaic theory.” This analysis
suggests that the
“mosaic theory,” if consistently applied, would implicate the cumulative effect of
previously accepted surveillance methods.121 It is in this capacity that the “mosaic theory” has the potential to revolutionize
the Fourth Amendment.
Court application of the mosaic theory is impractical and hurts police investigations.
Ostrander, 2011 (Benjamin M. Candidate for JD @ Notre Dame Law School, “THE “MOSAIC THEORY”
AND FOURTH AMENDMENT LAW” Notre Dame Law Review Lexis)
The use of emerging and existing intrusive technologies in criminal investigations certainly has the potential to have a substantial effect on
privacy. In an effort to combat the threat of such use, Maynard introduced the “mosaic theory” into Fourth Amendment law. The
“mosaic
theory” holds that individual law enforcement acts that are not “searches” become a “search” when
aggregated, as the whole reveals more than the individual acts it comprises. This Note suggests that despite the
intuitive appeal of a “mosaic theory,” the use of the theory in Fourth Amendment law is misguided. The “mosaic
theory” is inconsistent with the Supreme Court’s voluntary exposure analysis, which has often classified theoretical or limited disclosures of
information as complete exposures warranting no Fourth Amendment protection. 176 It is also inconsistent with the Supreme Court’s implicit
rejection of the proposition that the Fourth Amendment analysis is altered when an investigatory technique is prolonged to the point where
information may be accumulated.177 Not
only is the theory inconsistent with existing Fourth Amendment
jurisprudence, it is also impractical in application. A problematic question arises as to what durational
threshold must be crossed in order for the use of a pattern-detecting technology to be sufficiently
prolonged as to render it a search. Once this illusive threshold is crossed and a mosaic is created, the
question that then arises is how to define the scope of the mosaic. If a pattern is created only through
the use of multiple investigatory techniques, the entire investigation will be rendered a search. Also left
unanswered is the appropriate standard of review for the use of pattern-detecting investigatory techniques in criminal investigations. The
most serious implication of the theory, however, is that it calls into question a number of previously
accepted investigatory techniques.
Removal of the third party doctrine hurts law enforcement’s ability to investigate
Thompson 14 – Richard M Thompson II, is a Legislative Attorney for –––– 2014. (“The Fourth
Amendment Third-Party Doctrine,” Congressional Research Service, June 5, 2014. Available at
https://www.fas.org/sgp/crs/misc/R43586.pdf, Accessed on 07-06-2015)
As a more practical matter, assistance from third parties is utilized by law enforcement in almost every
investigation. When investigating a murder, robbery, or any other crime committed in the real world,
police officers will usually interview witnesses to obtain facts about the crime. To conduct these
interviews, the officers generally need not obtain a warrant, and witnesses who refuse to cooperate
can be compelled to testify with a grand jury subpoena.119 It could be argued that this process of fact
finding is very similar to requesting documentary evidence held by third parties and the same standard
should be applied to each.
In this same vein, Professor Orin Kerr has defended the third-party doctrine on the ground that it
maintains the appropriate balance of privacy and security in the face of technological change.120
Without the ability to use third parties such as telephone or Internet companies, Kerr posits, the
criminal would traditionally have to go out into the public to commit his crime where the Fourth
Amendment offers more limited protection. He argues that a criminal can use the services of these
third parties to commit crimes without having to expose these activities to areas open to public
surveillance.121 This, he posits, upsets the privacy-security balance that undergirds the Fourth
Amendment because it would require police to have probable cause to obtain any evidence of the
crime: “The effect would be a Catch-22: The police would need probable cause to observe evidence of
the crime, but they would need to observe evidence of the crime first to get probable cause.”122 Kerr
contends that the third-party doctrine responds to this imbalance by providing the same amount of
protection regardless of whether the defendant commits the crime on his own or through the use of a
third-party service.
Hurts Undercover Informants
Mosaic theory undermines the ability of undercover agents to work in law
enforcement.
Bedi, 2014 (Monu, Assistant Professor, DePaul University College of Law, “SOCIAL NETWORKS,
GOVERNMENT SURVEILLANCE, AND THE FOURTH AMENDMENT MOSAIC THEORY” Boston University
Law Review Lexis)
Scholars have questioned the viability of the mosaic theory, particularly as it relates to the status of
government investigative practices.11 Accepting this theory puts routine government surveillance in jeopardy of Fourth
Amendment restrictions.12 It seems that even the brief surveillance of an individual could reveal private information. For instance, a single trip
to a particular religious gathering or political function could reveal compromising or otherwise personal information that an individual would
like to keep secret. More generally, people may disagree as to what society thinks is reasonable or unreasonable surveillance.13 Perhaps even
short-term monitoring of a person’s public movements in a remote area where police are not likely to find themselves would also qualify as an
unreasonable intrusion.14 To make matters worse, this
theory also severely curtails the application of the Third
Party Doctrine, the corollary to the Public Disclosure Doctrine (collectively the “Doctrines”).15 The Third Party Doctrine
states that any information disclosed to another person or entity—much like the public generally—
loses any Fourth Amendment protection.16 This doctrine allows law enforcement to use undercover
agents and surreptitiously gather information without a warrant.17 However, under the mosaic approach,
one could also argue that these communications, taken in the aggregate, can reveal private
information about this person (e.g., disclosures about religious or privately held beliefs) and thus should be protected,
particularly if the agent goes to great lengths in gaining the confidence of the suspect. 1
Hurts Third Party Doctrine
Mosaic theory kills the third party doctrine and law enforcement
Bedi, 2014 (Monu, Assistant Professor, DePaul University College of Law, “SOCIAL NETWORKS,
GOVERNMENT SURVEILLANCE, AND THE FOURTH AMENDMENT MOSAIC THEORY” Boston University
Law Review Lexis)
The Third Party Doctrine would also be on shaky ground. Here, too, the mosaic theory would upset
the voluntary disclosure principle that stands at the heart of this doctrine.230 Shifting the focus to
what society or an individual deems reasonable (the first model of reasonable expectation of privacy) would surely
frustrate the use of undercover informants or other surreptitious data collection techniques that do not require a warrant.
Imagine a scenario where an informant is deep undercover for a significant period of time gaining the
trust of a Or imagine an informant who dupes a suspect into allowing her into her home and
disclosing private and incriminating information. suspect. Or perhaps the government simply acquires a wealth of
financial records from a suspect’s bank. Currently, all of these types of law enforcement tools do not trigger Fourth Amendment protection
because the individual voluntarily discloses the information to another person or entity.231 However, under
the mosaic theory,
none of these tactics are secure.232 Societal expectations may find that these methods, too, impinge
on Fourth Amendment rights as they involve unreasonable duplicity and reveal private information.
Police would thus find themselves in the new position of having to secure a warrant based on probable cause before engaging in these
practices. For some, this conclusion may be welcomed, particularly in today’s technological world where disclosures to various entities and
individuals have become ubiquitous.233 Justice Sotomayor, in fact, raises this possibility in her concurrence.234 This Article does not take such
a drastic approach, nor would such a course be desirable. Any
such rejection would come at the cost of jettisoning or
severely curtailing essential law enforcement investigative techniques that have historically not been subject to
warrant and probable cause requirements.235
Child Porn Impact
Police effectiveness and internet surveillance strategies are key to stopping atrocities
such as child pornography
Wortley and Smallbone 12 – Richard Wortley has a PhD in psychology, and worked as a prison
psychologist for ten years, and is a past national Chair of the Australian Psychological Society’s College of
Forensic Psychologists; Stephen Smallbone is a psychologist and Professor in the School of Criminology
and Criminal Justice and an Australian Research Council ‘Future’ Fellow, 2012 (“Child Pornography on
the Internet,” Problem-Oriented Guides for Police Problem-Specific Guides Series No. 41, 5/2012,
Avaliable Online at http://www.hawaii.edu/hivandaids/Child_Pornography_on_the_Internet.pdf,
accessed on 7/3/15)//CM
General Considerations for an Effective Response Strategy As noted, Internet child pornography presents some unique
challenges for law enforcement agencies. However, despite the difficulties involved in controlling the
problem, local police have an important role to play. To maximize their contribution, local police departments
need to: Acquire technical knowledge and expertise in Internet pornography. If your department does not have a
specialized Internet crime unit, then find out where you can obtain assistance or training. Appendix B lists online resources that can provide
information on national and international initiatives, tips and leads, technical assistance, and staff training. Establish links with
other
agencies and jurisdictions. It is important that local police departments share information and
coordinate their activities with other jurisdictions. Appendix B also lists agencies that have specific programs or sections
designed to provide a coordinated response to Internet child pornography. Establish links with ISPs. ISPs can be crucial
partners for police. As has been noted, there is often a lack of specific legislation setting out ISPs’
obligations. This makes it especially important for police to establish good working relations with ISPs
to elicit their cooperation in the fight against Internet child pornography. Prioritize their efforts. Because of the
volume of Internet child pornography crime, police forces need to prioritize their efforts and concentrate on the
most serious offenders, particularly those actually involved in abusing children and producing
pornographic images.60 For example, one strategy may be to cross reference lists of Internet child pornography users with sex
offender registries to increase the chance of targeting hands-on offenders (see Appendix B). It has been noted that success in combating child
pornography is too often judged in terms of the number of images recovered, rather than by the more significant criterion of whether the
crimes the images portray have been prevented. Specific Responses to Reduce Internet Child Pornography It is generally acknowledged that it is
impossible to totally eliminate child pornography from the Internet. However, it is possible to reduce the volume of child pornography on the
Internet, to make it more difficult or risky to access, and to identify and arrest the more serious perpetrators. Since 1996, ISPs have removed
some 20,000 pornographic images of children from the web.62 Around 1,000 people are arrested annually in the United States for Internet
child pornography offenses.63 The following strategies have been used or suggested to reduce the problem of child pornography on the
Internet. Computer Industry Self Regulation ISPs
have a central role to play in combating Internet child
pornography. The more responsibility ISPs take in tackling the availability of child pornography images
on the Internet, the more resources police can devote to addressing the production side of the
problem. However, there are two competing commercial forces acting on ISPs with respect to self regulation. On the one hand, if an ISP
restricts access to child pornography on its server, it may lose out financially to other ISPs who do not. Therefore, it will always be possible for
offenders to find ISPs who will store or provide access to child pornography sites. On the other hand, ISPs also have their commercial reputation
to protect, and it is often in their best interests to cooperate with law enforcement agencies.
Most major ISPs have shown a
commitment to tackling the problem of child pornography. By establishing working relationships with
ISPs, and publicizing those ISPs who take self regulation seriously, police may be able to encourage
greater levels of self regulation. Current self-regulatory strategies include:1. Removing illegal sites. A number of ISP
associations have drafted formal codes of practice that explicitly bind members to not knowingly
accept illegal content on their sites, and to removing such sites when they become aware of their
existence. Service agreement contracts with clients will often set out expected standards that apply to site content. Large ISPs may have
active cyber patrols that search for illegal sites.64 2. Establishing complaint sites/hotlines. Some ISP associations have set up Internet sites or
hotlines that allow users to report illegal practices.65 These associations either deal directly with the complaint (e.g., by contacting the
webmaster, the relevant ISP, or the police) or refer the complainant to the appropriate authorities. 3. Filtering browsers/search engines.
ISPs
can apply filters to the browsers and search engines their customers use to locate websites. There are
numerous filtering methods. For example, filters can effectively treat certain key words as if they do
not exist, so that using these words in a search will be fruitless.66 Software that can identify
pornographic images is also being developed. Legislative Regulation Not everyone is satisfied with the current reliance on
self regulation, and there have been calls for increased legislation to compel the computer industry to play
a greater role in controlling Internet child pornography. Police may be an important force in lobbying
for tighter restrictions. Among the proposals for tighter regulation are: 4. Making ISPs legally
responsible for site content. ISPs’ legal responsibilities to report child pornography vary among jurisdictions. In the United
States, ISPs are legally required to report known illegal activity on their sites, but they are not
required to actively search for such sites.68 It has been argued that ISPs’ legal responsibilities should be
strengthened to require a more proactive role in blocking illegal sites.69 5. Requiring the preservation
of ISP records. Police may apply for a court order to seize ISP accounts.70 However, to assist in the prosecution of
offenders, ISPs need to maintain good records of IP logging, caller ID, web hostings, and so forth.71 6. Requiring user verification.
ISPs often exercise little control over verifying the identities of people who open Internet accounts.
Accounts may be opened using false names and addresses, making it difficult to trace individuals who
engage in illegal Internet activity. In addition, without verifying users’ ages, there is no way of knowing if children are operating
Internet accounts without adult supervision. This problem of Internet anonymity is likely to increase as the
potential to access the Internet via mobile phones becomes more common. It has been argued that both ISPs
and mobile phone networks need to strengthen procedures for user verification.72 7. Regulating anonymous remailers.
Remailers are servers that forward emails after stripping them of sender identification. It has been
argued that much tighter regulation of remailers is necessary. Some have advocated making remailer administrators
legally responsible for knowingly forwarding illegal material, while others have called for a complete ban on remailers.73 8. Using key escrowed
encryption. Encryption of pornographic images is shaping to be the biggest technological problem facing law enforcement agencies. Key
escrowed encryption would require anyone selling encryption software to supply a trusted third party with a key to the code.74 This has been
strongly resisted by the computer industry. In the meantime, work continues on developing code-breaking software.
Surv. Key To Solve
Law enforcement responses to child pornographers rely on effectiveness and
surveillance
Wortley and Smallbone 12 – Richard Wortley has a PhD in psychology, and worked as a prison
psychologist for ten years, and is a past national Chair of the Australian Psychological Society’s College of
Forensic Psychologists; Stephen Smallbone is a psychologist and Professor in the School of Criminology
and Criminal Justice and an Australian Research Council ‘Future’ Fellow, 2012 (“Child Pornography on
the Internet,” Problem-Oriented Guides for Police Problem-Specific Guides Series No. 41, 5/2012,
Avaliable Online at http://www.hawaii.edu/hivandaids/Child_Pornography_on_the_Internet.pdf,
accessed on 7/3/15)//CM
Law Enforcement Responses In the strategies discussed so far the police role has largely involved
working in cooperation with other groups or acting as educators. A number of strategies are the
primary responsibility of police. As a rule, local police will not carry out major operations. Most major
operations require specialized expertise and inter-agency and inter-jurisdictional cooperation. (See
Appendix C for a summary of major coordinated law enforcement operations in recent years.) However,
local police will almost certainly encounter cases of Internet child pornography in the course of their
daily policing activities. Law enforcement responses include: 19. Locating child pornography sites.
Police agencies may scan the Internet to locate and remove illegal child pornography sites. Many areas
of the Internet are not accessible via the usual commercial search engines, and investigators need to be
skilled at conducting sophisticated searches of the ‘hidden net.’ Police may issue warnings to ISPs that
are carrying illegal content. 20. Conducting undercover sting operations. Law enforcement agents may
enter pedophile newsgroups, chat rooms, or P2P networks posing as pedophiles and request emailed
child pornography images from others in the group.82 Alternatively, they may enter child or teen
groups posing as children and engage predatory pedophiles lurking in the group who may send
pornography or suggest a meeting. A variation of the sting operation is to place ads on the Internet
offering child pornography for sale and wait for replies.83 Recently, Microsoft announced the
development of the Child Exploitation Tracking System to help link information such as credit card
purchases, Internet chat room messages, and conviction histories.84 21. Setting up honey trap sites.
These sites purport to contain child pornography but in fact are designed to capture the IP or credit
card details of visitors trying to download images. These can be considered a type of sting operation
and have resulted in numerous arrests. However, their primary purpose is to create uncertainty in the
minds of those seeking child pornography on the Internet, and, therefore, reduce the sense of freedom
and anonymity they feel (see Operation Pin in Appendix C). 22. Publicizing crackdowns. Many police
departments have learned to use the media to good effect to publicize crackdowns on Internet child
pornography.85 Coverage of crackdowns in the mass media increases the perception among potential
offenders that the Internet is an unsafe environment in which to access child pornography. 23.
Conducting traditional criminal investigations. Although most media attention is often given to
technological aspects of controlling Internet child pornography, in fact many arrests in this area arise
from traditional investigative police work. Investigations may involve information from: The public:
The public may contact police directly, or information may be received on one of the various child
pornography hotlines. Computer repairers/technicians: Some states mandate computer personnel to
report illegal images.86 There are cases where computer repairers have found child pornography
images on an offender’s hard drive and notified police.87 Police may establish relationships with local
computer repairers/ technicians to encourage reporting. Victims: A point of vulnerability for producers
of child pornography is the child who appears in the pornographic image. If the child informs others of
his/her victimization, then the offender’s activities may be exposed.88 Known traders: The arrest of one
offender can lead to the arrest of other offenders with whom he has had dealings, producing a
cascading effect. In some cases the arrested offender’s computer and Internet logs may provide
evidence of associates. (See Operation Cathedral in Appendix C.) Unrelated investigations: There is
increasing evidence that many sex offenders are criminally versatile and may commit a variety of other
offenses.89 Police may find evidence of Internet child pornography while investigating unrelated crimes
such as drug offenses.
Cyber Harassment Impact
Cyberharassment is a growing problem - mosaic theory hinders apprehension.
Gray, Keats Citron, and Rinehart, 2013 (David, Associate Professor, University of Maryland
Francis King Carey School of Law, Danielle, Lois K. Macht Research Professor of Law, University of
Maryland Francis King Carey School of Law, and Liz Clark, University of Maryland Francis King Carey
School of Law, “SYMPOSIUM ON CYBERCRIME: FIGHTING CYBERCRIME AFTER UNITED STATES V. JONES”
Journal of Criminal Law & Criminology Lexis)
Cyberharassment is a widespread and growing challenge for law enforcement in the United States.
These online attacks feature threats of violence, privacy invasions, reputation-harming falsehoods,
impersonation, computer hacking, and extortion. They often appear in e-mails, instant messages, blog
entries, message boards, or sites devoted to tormenting individuals. As the executive director of the National Center
for Victims of Crime explained in her congressional testimony supporting the 2006 cyberstalking amendment to the Violence Against Women
Act: Stalkers
are using very sophisticated technology ... - installing spyware on your computer so that they can track
all of your interactions on the Internet, your purchases, your e-mails and so forth, and then using that against you, forwarding e-mails
to people at your job, broadcasting your whereabouts, your purchases, your reading habits and so on, or installing GPS in your car so that you
will show up at the grocery store, at your local church, wherever and there is the stalker and you can't imagine how the stalker knew that you
were going to be there... . I am happy that this legislation amends the statute so that prosecutors have more effective tools, I think, to address
technology through VAWA 2005. n257 Although some attackers confine their harassment to networked technologies, others use all available
tools to harass victims, including real-space contact. Offline harassment or stalking often includes abusive phone calls, vandalism, threatening
mail, and physical assault. n258 According to the Bureau of Justice Statistics, 850,000
adults experienced stalking with an
online component in 2006, including threats in e-mails, text messages, chat rooms, and blogs. n259
Young people are even more likely to experience some form of cyberharassment. The National Center
for Education Statistics reports that, during the 2008-2009 school year, 1.5 million young people in the
United States were victims of some form of cyberharassment. n260 Already a significant problem, [*789]
cyberharassment is on the rise. College students now report more sexually harassing speech in online
interactions than in face-to-face ones. As the National Institute of Justice explains, the "ubiquity of the Internet and the ease
with which it allows others unusual access to personal information" make individuals more accessible and vulnerable to online abuse. n261
Harassing someone online is far cheaper and less personally risky than confronting them in space. n262
Cyberharassment and the identity of its victims follow the well-worn pathways of bias crimes. The most recent Bureau of Justice
Statistics findings report that 74% of online stalking victims are female. n263 Perpetrators are far more
likely to be men. n264 Unsurprisingly, the content of these attacks are often sexually explicit and
demeaning, drawing predominantly on gender stereotypes. As one blogger observed, "the fact is, to be a
woman online is to eventually be threatened with rape and death. On a long enough timeline, the
chances of this not occurring
drop to [*790] zero." n265 Cyberharassment
also follows racial lines. A study
to this study,
nonwhite females faced cyberharassment more than any other group, with 53% reporting having been harassed
online. Next were white females, with 45% reporting having been targeted online, with nonwhite males right behind
them at 40%. The group least likely to have been harassed was white males, at 31%. n266 Across race, being lesbian,
transgender, or bisexual also raised the risk of being harassed. real n267 Another disturbing feature of
cyberharassment is that it tends to be perpetrated by groups rather than individuals. Those who
engage in abusive online conduct often move in packs. n268 Cyberharassers frequently engage proxies to help torment
conducted in 2009 asked 992 undergraduate students about their experience with cyberharassment. According
their victims. n269 These group attacks bear all of the hallmarks of violent mob behavior. So much so, in fact, that one of us has dubbed them
"cyber mobs." n270 As with sole practitioners, online mob harassment is more likely to be perpetrated by members of dominant demographics,
and to draw on popular stigmas for the purpose of shaming and degrading their targets. n271 Of course, cold statistics and
general
description tell at best part of the story of legitimate government and law enforcement interests in
preventing, detecting, and prosecuting cyberharassment. Recent efforts to highlight the privacy
interests that compel recognition of the mosaic theory of Fourth Amendment privacy make liberal use of
individual stories, in part to pluck [*791] empathetic strings in the audience. n272 In weighing the competing interests at
stake in regulating access to and use of digital surveillance technologies, it is therefore fair to consider
the impact of crimes like cyberharassment in individual cases. Take the publicly reported case of D.C. v. R.R. n273 D.C. was a
high school student who was actively pursuing a career in the entertainment industry as a singer and actor. n274 He used a pseudonym in his
professional career, n275 under which he maintained a fan site that, among other features, allowed visitors to post comments to a
"guestbook." Several students at D.C.'s school, who were later identified in a civil suit, engaged in a pattern of targeted harassment of D.C. by
posting comments to his website. Some were simply offensive - one student told D.C. that he was "the biggest fag in the [high school] class."
n276 Others, however, went much further, threatening physical and sexual violence in graphic detail. One person posted on D.C.'s website, "I
want to rip out your fucking heart and feed it to you... . If I ever see you I'm ... going to pound your head in with an ice pick. Fuck you, you dickriding penis lover. I hope you burn in hell." n277 Another post told D.C. that he was "now officially wanted dead or alive," and a third promised
to "unleash my manseed in those golden brown eyes." n278 According to a California appellate court, the contents of these posts suggested
that "the students ... sought to destroy D.C.'s life, threatened to murder him, and wanted to drive him out of [his high school] and the
community in which he lived." n279 In that goal they were successful. On [*792] advice of law enforcement, who consulted the Federal Bureau
of Investigation, D.C. withdrew from his school and moved with his family to the other end of the state. n280 Despite these efforts, the student
newspaper at his former school reported his new location and the name of his new institution. n281 As a consequence of this harassment, D.C.
developed a persistent anxiety disorder. n282 Cyberharassment
has also spawned a new brand of extortion labeled
"sextortion." n283 This is a form of blackmail in which the extortionist threatens to publicize images or
information that his target might find embarrassing unless the victim provides sexually explicit
pictures and videos or agrees to participate in live sex shows via Skype or other direct video
communications. n284 One infamous perpetrator of sextortion schemes invaded his targets' computers using malicious software that
allowed him to mine his victims' hard drives for compromising images or to capture images using their own computer cameras. n285 He then
used those images and access to his targets' computers and e-mail accounts to terrorize them until they agreed to produce sexually explicit
pictures or videos for him. Young
people are particularly vulnerable. n286 Teenagers who are extorted into
engaging in explicit sex acts under threat and at such a formative stage of their development are also
more likely to suffer scarring emotional and psychological harm. n287 As United States Attorney Joseph Hogsett put
the [*793] point when commenting on a successful prosecution, "This defendant may not remember his alleged victims, but the true tragedy is
that not one of them will ever forget." n288 Cyberharassers engage in telephone harassment as well. For example, in
September 2010, Daniel Leonard pleaded guilty to a pattern of harassment that involved over 4,000 threatening and sexually explicit phone
calls made to over 1,200 phone numbers using an Internet "spoofing" service that masked his phone number from the call recipients. n289
Others go further still by using the Internet to incite others to rape and stalk victims. Federal
prosecutors recently brought a
cyberstalking indictment against a man who impersonated his ex-girlfriend online over a four-year
period, inciting others to stalk her in person. The man posted online advertisements with the victim's contact information and
her alleged desire for sex with strangers. On porn sites, he uploaded videos of her having sex (which he filmed while they were dating)
alongside her contact information. n290 Because strange men began appearing at her home demanding sex, the woman changed her name and
moved to another state. Her ex-boyfriend discovered her new personal information and again posted her name, address, and an invitation to
have sex on pornography sites next to her picture. The cycle repeated itself, with strange men coming to her house at night demanding sex.
Although this victim was never physically assaulted, others are not so lucky. In December 2009, Ty McDowell broke into the home of a woman
in Casper, Wyoming, tied her up, and raped her. During the course of the [*794] attack, he told her: "You want an aggressive man, bitch, I'll
show you aggressive." n291 Although McDowell did not know his victim, his crime was not random. Rather, he had responded to an online
advertisement posted on Craigslist that purported to be from a woman seeking to fulfill her own rape fantasies. After a lengthy correspondence
with the ad's poster, McDowell believed that he was fulfilling his victim's desires. n292 He was not. As a subsequent investigation would reveal,
McDowell was in communication with Jebediah Stipe, who posted the ad and arranged the attack on his ex-girlfriend. n293 Stipe and McDowell
were sentenced to sixty-year prison terms after pleading guilty to charges of aggravated kidnapping, rape, and burglary. n294
Cyberharassment can also be more general. Sites that encourage sexualized online abuse are all too
common. The website IsAnyoneUp.com provides a notorious example. For a time, it was one of the most popular forums on the Internet for
"revenge porn," which entails spurned former lovers posting sexualized pictures of their ex-wives and ex-girlfriends on a public forum so that
others can leer at and demean them. n295 Although IsAnyoneUp.com eventually shut down amidst protests and outcry, its operator, Hunter
Moore, started a similar site under a different name, HunterMoore.TV, which may eventually include not only pictures of women, but also an
overlaid map to the homes of those featured in the pictures. n296 Consider too "Violentacrez," a notorious Reddit administrator [*795] who
oversaw forums like "Jailbait," "Creepshots," "Rapebait," "Incest," "Beatingwomen," and "Picsofdeadjailbait," each of which featured pictures
and commentary from his followers that celebrated the interests described by the forums' titles. n297 There
is, of course, much
more to be written about the incidents and dynamics of cyberharassment crimes. For present
purposes, however, the foregoing is sufficient to show that there are significant and legitimate
governmental interests at stake in preventing, detecting, and prosecuting various forms of
cyberharassment. Although cyberharassment is relatively new, executives and legislatures have
manifested these interests by setting up dedicated enforcement units and passing tailored criminal
statutes. n298 As we argue in the next section, adopting a mosaic theory of the Fourth Amendment
likely will implicate these law enforcement concerns by limiting access to both existing and future
digital surveillance techniques and technologies. n299
Online harassment and the lack of response from institutions allows for threats,
violence, and discrimination against women to continue unabated
Hess 14 – Amanda Hess is a Slate staff writer and popular Gender & Sexuality reporter, 2014 (“Why
Women Aren't Welcome on the Internet,” Pacific Standard, 1/6/14, http://www.psmag.com/healthand-behavior/women-arent-welcome-internet-72170, 7/3/15)//CM
A woman doesn’t even need to occupy a professional writing perch at a prominent platform to become a target. According to a 2005 report by
women and men have
been logging on in equal numbers since 2000, but the vilest communications are still
disproportionately lobbed at women. We are more likely to report being stalked and harassed on the
Internet—of the 3,787 people who reported harassing incidents from 2000 to 2012 to the volunteer organization
Working to Halt Online Abuse, 72.5 percent were female. Sometimes, the abuse can get physical: A Pew survey reported
that five percent of women who used the Internet said “something happened online” that led them into
“physical danger.” And it starts young: Teenage girls are significantly more likely to be cyberbullied than boys. Just appearing as
a woman online, it seems, can be enough to inspire abuse. In 2006, researchers from the University of Maryland set up a
the Pew Research Center, which has been tracking the online lives of Americans for more than a decade,
bunch of fake online accounts and then dispatched them into chat rooms. Accounts with feminine usernames incurred an average of 100
sexually explicit or threatening messages a day. Masculine names received 3.7. There are three federal laws that apply to cyberstalking cases;
the first was passed in 1934 to address harassment through the mail, via telegram, and over the telephone, six decades after Alexander Graham
Bell’s invention. Since the initial passage of the Violence Against Women Act, in 1994, amendments to the law have gradually updated it to
apply to new technologies and to stiffen penalties against those who use them to abuse. Thirty-four states have cyberstalking laws on the
But making
quick and sick threats has become so easy that many say the abuse has proliferated to the point of
meaninglessness, and that expressing alarm is foolish. Reporters who take death threats seriously “often give the
books; most have expanded long-standing laws against stalking and criminal threats to prosecute crimes carried out online.
impression that this is some kind of shocking event for which we should pity the ‘victims,’” my colleague Jim Pagels wrote in Slate this fall, “but
anyone who’s spent 10 minutes online knows that these assertions are entirely toothless.” On Twitter, he added, “When there’s no precedent
for physical harm, it’s only baseless fear mongering.” My friend Jen Doll wrote, at The Atlantic Wire, “It seems like that old ‘ignoring’ tactic your
mom taught you could work out to everyone’s benefit.... These people are bullying, or hope to bully. Which means we shouldn’t take the bait.”
In the epilogue to her book The End of Men, Hanna Rosin—an editor at Slate—argued that harassment of women online could be seen as a
cause for celebration. It shows just how far we’ve come. Many women on the Internet “are in positions of influence, widely published and
widely read; if they sniff out misogyny, I have no doubt they will gleefully skewer the responsible sexist in one of many available online outlets,
and get results.” "Twitter is the place where I laugh, whine, work, schmooze, procrastinate, and flirt. It sits in my back pocket wherever I go and
lies next to me when I fall asleep. And since I first started writing in 2007, it's become just one of the many online spaces where men come to
women who are harassed online are expected to either get over ourselves or feel
flattered in response to the threats made against us. We have the choice to keep quiet or respond “gleefully.” But no
matter how hard we attempt to ignore it, this type of gendered harassment—and the sheer volume of it—has
severe implications for women’s status on the Internet. Threats of rape, death, and stalking can
overpower our emotional bandwidth, take up our time, and cost us money through legal fees, online
protection services, and missed wages. I’ve spent countless hours over the past four years logging the online activity of one
particularly committed cyberstalker, just in case. And as the Internet becomes increasingly central to the human
experience, the ability of women to live and work freely online will be shaped, and too often limited,
tell me to get out." So
by the technology companies that host these threats, the constellation of local and federal law
enforcement officers who investigate them, and the popular commentators who dismiss them—all
arenas that remain dominated by men, many of whom have little personal understanding of what
women face online every day. This Summer, Caroline Criado-Perez became the English-speaking Internet’s most famous recipient
of online threats after she petitioned the British government to put more female faces on its bank notes. (When the Bank of England
announced its intentions to replace social reformer Elizabeth Fry with Winston Churchill on the £5 note, Criado-Perez made the modest
suggestion that the bank make an effort to feature at least one woman who is not the Queen on any of its currency.) Rape and death threats
amassed on her Twitter feed too quickly to count, bearing messages like “I will rape you tomorrow at 9 p.m ... Shall we meet near your house?”
Then, something interesting happened. Instead of logging off, Criado-Perez retweeted the threats, blasting them out to her Twitter followers.
She called up police and hounded Twitter for a response. Journalists around the world started writing about the threats. As more and more
people heard the story, Criado-Perez’s follower count skyrocketed to near 25,000. Her supporters joined in urging British police and Twitter
executives to respond. Under the glare of international criticism, the police and the company spent the next few weeks passing the buck back
and forth. Andy Trotter, a communications adviser for the British police, announced that it was Twitter’s responsibility to crack down on the
messages. Though Britain criminalizes a broader category of offensive speech than the U.S. does, the sheer volume of threats would be too
difficult for “a hard-pressed police service” to investigate, Trotter said. Police “don’t want to be in this arena.” It diverts their attention from
“dealing with something else.” Feminine usernames incurred an average of 100 sexually explicit or threatening messages a day. Masculine
names received 3.7. Meanwhile, Twitter issued a blanket statement saying that victims like Criado-Perez could fill out an online form for each
abusive tweet; when Criado-Perez supporters hounded Mark Luckie, the company’s manager of journalism and news, for a response, he briefly
shielded his account, saying that the attention had become “abusive.” Twitter’s official recommendation to victims of abuse puts the ball
squarely in law enforcement’s court: “If an interaction has gone beyond the point of name calling and you feel as though you may be in
danger,” it says, “contact your local authorities so they can accurately assess the validity of the threat and help you resolve the issue offline.” In
the weeks after the flare-up, Scotland Yard confirmed the arrest of three men. Twitter—in response to several online petitions calling for
action—hastened the rollout of a “report abuse” button that allows users to flag offensive material. And Criado-Perez went on receiving
The Internet is a
global network, but when you pick up the phone to report an online threat, whether you are in London or Palm
Springs, you end up face-to-face with a cop who patrols a comparatively puny jurisdiction. And your cop
will probably be a man: According to the U.S. Bureau of Justice Statistics, in 2008, only 6.5 percent of state police
officers and 19 percent of FBI agents were women. The numbers get smaller in smaller agencies. And in many locales,
threats. Some real person out there—or rather, hundreds of them—still liked the idea of seeing her raped and killed.
police work is still a largely analog affair: 911 calls are immediately routed to the local police force; the closest officer is dispatched to respond;
he takes notes with pen and paper. After Criado-Perez received her hundreds of threats, she says she got conflicting instructions from police on
how to report the crimes, and was forced to repeatedly “trawl” through the vile messages to preserve the evidence. “I can just about cope with
threats,” she wrote on Twitter. “What I can’t cope with after that is the victim-blaming, the patronising, and the police record-keeping.” Last
year, the American atheist blogger Rebecca Watson wrote about her experience calling a series of local and national law enforcement agencies
after a man launched a website threatening to kill her. “Because I knew what town [he] lived in, I called his local police department. They told
me there was nothing they could do and that I’d have to make a report with my local police department,” Watson wrote later. “[I] finally got
through to someone who told me that there was nothing they could do but take a report in case one day [he] followed through on his threats,
at which point they’d have a pretty good lead.” The first time I reported an online rape threat to police, in 2009, the officer dispatched to my
home asked, “Why would anyone bother to do something like that?” and declined to file a report. In Palm Springs, the officer who came to my
room said, “This guy could be sitting in a basement in Nebraska for all we know.” That my stalker had said that he lived in my state, and had
plans to seek me out at home, was dismissed as just another online ruse. Of course, some people are investigated and prosecuted for
cyberstalking. In 2009, a Florida college student named Patrick Macchione met a girl at school, then threatened to kill her on Twitter, terrorized
her with lewd videos posted to YouTube, and made hundreds of calls to her phone. Though his victim filed a restraining order, cops only sprung
into action after a county sheriff stopped him for loitering, then reportedly found a video camera in his backpack containing disturbing
recordings about his victim. The sheriff’s department later worked with the state attorney’s office to convict Macchione on 19 counts, one of
which was cyberstalking (he successfully appealed that count on grounds that the law hadn’t been enacted when he was arrested); Macchione
was sentenced to four years in prison. Consider also a recent high-profile case of cyberstalking investigated by the FBI. In the midst of her affair
with General David Petraeus, biographer Paula Broadwell allegedly created an anonymous email account for the purpose of sending harassing
notes to Florida socialite Jill Kelley. Kelley reported them to the FBI, which sniffed out Broadwell’s identity via the account’s location-based
metadata and obtained a warrant to monitor her email activity. In theory, appealing to a higher jurisdiction can yield better results. “Local law
enforcement will often look the other way,” says Dr. Sameer Hinduja, a criminology professor at Florida Atlantic University and co-director of
the Cyberbullying Research Center. “They don’t have the resources or the personnel to investigate those crimes.” County, state, or federal
agencies at least have the support to be more responsive: “Usually they have a computer crimes unit, savvy personnel who are familiar with
these cases, and established relationships with social media companies so they can quickly send a subpoena to help with the investigation,”
Hinduja says. But in my experience and those of my colleagues, these larger
law enforcement agencies have little capacity
or drive to investigate threats as well. Despite his pattern of abusive online behavior, Macchione was ultimately arrested for an
unrelated physical crime. When I called the FBI over headlessfemalepig’s threats, a representative told me an agent would get in touch if the
bureau was interested in pursuing the case; nobody did. And when Rebecca Watson reported the threats targeted at her to the FBI, she initially
connected with a sympathetic agent—but the agent later expressed trouble opening Watson’s file of screenshots of the threats, and soon
stopped replying to her emails. The Broadwell investigation was an uncommon, and possibly unprecedented, exercise for the agency. As
University of Wisconsin-Eau Claire criminal justice professor Justin Patchin told Wired at the time:
“I’m not aware of any case
when the FBI has gotten involved in a case of online harassment.” After I received my most recent round of threats, I
asked Jessica Valenti, a prominent feminist writer (and the founder of the blog Feministing), who’s been repeatedly targeted with online
threats, for her advice, and then I asked her to share her story. “It’s not really one story. This has happened a number of times over the past
seven years,” she told me. When
rape and death threats first started pouring into her inbox, she vacated her
apartment for a week, changed her bank accounts, and got a new cell number. When the next wave of
threats came, she got in touch with law enforcement officials, who warned her that though the men
emailing her were unlikely to follow through on their threats, the level of vitriol indicated that she
should be vigilant for a far less identifiable threat: silent “hunters” who lurk behind the tweeting
“hollerers.” The FBI advised Valenti to leave her home until the threats blew over, to never walk
outside of her apartment alone, and to keep aware of any cars or men who might show up repeatedly
outside her door. “It was totally impossible advice,” she says. “You have to be paranoid about
everything. You can’t just not be in a public place.” And we can’t simply be offline either. When Time journalist Catherine
Mayer reported the bomb threat lodged against her, the officers she spoke to—who thought usernames were secret codes and didn’t seem to
know what an IP address was—advised her to unplug. “Not one of the officers I’ve encountered uses Twitter or understands why anyone would
wish to do so,” she later wrote. “The officers were unanimous in advising me to take a break from Twitter, assuming, as many people do, that
Twitter is at best a time-wasting narcotic.” All of these online offenses are enough to make a woman want to click away from Twitter, shut her
laptop, and power down her phone. Sometimes, we do withdraw: Pew found that from 2000 to 2005, the percentage of Internet users who
participate in online chats and discussion groups dropped from 28 percent to 17 percent, “entirely because of women’s fall off in participation.”
But for many women, steering clear of the Internet isn’t an option. We use our devices to find supportive communities, make a living, and
construct safety nets. For a woman like me, who lives alone, the Internet isn’t a fun diversion—it is a necessary resource for work and
interfacing with friends, family, and, sometimes, law enforcement officers in an effort to feel safer from both online and offline violence. The
Internet is a global network, but when you pick up the phone to report an online threat, you end up
face-to-face with a cop who patrols a comparatively puny jurisdiction. The Polish sociologist Zygmunt
Bauman draws a distinction between “tourists” and “vagabonds” in the modern economy. Privileged
tourists move about the world “on purpose,” to seek “new experience” as “the joys of the familiar
wear off.” Disempowered vagabonds relocate because they have to, pushed and pulled through mean
streets where they could never hope to settle down. On the Internet, men are tourists and women are
vagabonds. “Telling a woman to shut her laptop is like saying, ‘Eh! Just stop seeing your family,’” says Nathan Jurgenson, a social media
sociologist (and a friend) at the University of Maryland. What does a tourist look like? In 2012, Gawker unmasked “Violentacrez,” an
anonymous member of the online community Reddit who was infamous for posting creepy photographs of underage women and creating or
moderating subcommunities on the site with names like “chokeabitch” and “rapebait.” Violentacrez turned out to be a Texas computer
programmer named Michael Brusch, who displayed an exceedingly casual attitude toward his online hobbies. “I do my job, go home, watch TV,
and go on the Internet. I just like riling people up in my spare time,” he told Adrian Chen, the Gawker reporter who outed him. “People take
Abusers tend to operate anonymously, or under pseudonyms. But the
women they target often write on professional platforms, under their given names, and in the context
of their real lives. Victims don’t have the luxury of separating themselves from the crime. When it
comes to online threats, “one person is feeling the reality of the Internet very viscerally: the person
who is being threatened,” says Jurgenson. “It’s a lot easier for the person who made the threat—and the person who is investigating
things way too seriously around here.”
the threat—to believe that what’s happening on the Internet isn’t real.” When authorities treat the Internet as a fantasyland, it has profound
effects on the investigation and prosecution of online threats. Criminal threat laws largely require that victims feel tangible, immediate, and
sustained fear. In my home state of California, a threat must be “unequivocal, unconditional, immediate, and specific” and convey a “gravity of
If police don’t know whether the
harasser lives next door or out in Nebraska, it’s easier for them to categorize the threat as nonimmediate. When they treat a threat as a boyish hoax, the implication is that the threat ceases to be a
criminal offense. So the victim faces a psychological dilemma: How should she understand her own
fear? Should she, as many advise, dismiss an online threat as a silly game, and not bother to inform
the cops that someone may want to—ha, ha—rape and kill her? Or should she dutifully report every
purpose and an immediate prospect of execution of the threat” to be considered a crime.
threat to police, who may well dismiss her concerns? When I received my most recent rape and death threats, one friend
told me that I should rest assured that the anonymous tweeter was unlikely to take any physical action against me in real life; another noted
that my stalker seemed like the type of person who would fashion a coat from my skin, and urged me to take any action necessary to land the
stalker in jail. Danielle Citron, a University of Maryland law professor who focuses on Internet threats, charted the popular response to Internet
death and rape threats in a 2009 paper published in the Michigan Law Review. She found that Internet harassment is routinely dismissed as
“harmless locker-room talk,” perpetrators as “juvenile pranksters,” and victims as “overly sensitive complainers.” Weighing in on one online
harassment case, in an interview on National Public Radio, journalist David Margolick called the threats “juvenile, immature, and obnoxious,
but that is all they are ... frivolous frat-boy rants.” When
police treat a threat as a boyish hoax, the implication is that
the threat ceases to be a criminal offense. Of course, the frat house has never been a particularly safe space for women. I’ve
been threatened online, but I have also been harassed on the street, groped on the subway, followed home from the 7-Eleven, pinned down on
a bed by a drunk boyfriend, and raped on a date. Even if I sign off Twitter, a threat could still be waiting on my stoop. Today,
a legion of
anonymous harassers are free to play their “games” and “pranks” under pseudonymous screen
names, but for the women they target, the attacks only compound the real fear, discomfort, and
stress we experience in our daily lives.
Ext. MT Hurts CH
Adopting the mosaic theory limits investigators ability to solve cyber harassment.
Gray, Keats Citron, and Rinehart, 2013 (David, Associate Professor, University of Maryland
Francis King Carey School of Law, Danielle, Lois K. Macht Research Professor of Law, University of
Maryland Francis King Carey School of Law, and Liz Clark, University of Maryland Francis King Carey
School of Law, “SYMPOSIUM ON CYBERCRIME: FIGHTING CYBERCRIME AFTER UNITED STATES V. JONES”
Journal of Criminal Law & Criminology Lexis)
Despite these complications, tracing an IP address is a common and effective way for authorities to identify
perpetrators of cyberharassment crimes. At present, the public-observation and third-party doctrines
grant law enforcement unfettered discretion to track IP addresses across the Internet. Most
cyberharassment is, to one degree or another, public. Furthermore, the third-party doctrine means that law
enforcement officers need a subpoena, at most, to secure user information associated with an IP
address from ISPs and other third parties, including social-networking sites. n307 A mosaic theory of
Fourth Amendment privacy might well change [*798] all of this. Tracking someone's online activities
using an IP address over a period of time is akin to tracking a person through physical space using GPSenabled tracking devices. By aggregating information about a user and his online activities, law enforcement officers
using these fairly basic digital surveillance techniques can therefore assemble precisely the sorts of
revealing informational mosaics that worried the concurring Justices in Jones. Digital surveillance
technology that offends mosaic sensibilities promises even more benefits than IP traces to law
enforcement officers interested in detecting cybercrimes. Take, for example, forums such as those organized and
moderated by Violentacrez. n308 v c Although under current law and free speech doctrine it is perfectly legal to
view and comment on pictures of young women in public, law enforcement officers might have
reason to worry that habitues of forums like "Jailbait" and "Creepshots" are more likely than most to
produce or possess actual child pornography. It is, of course, impossible to conduct even cursory investigations of the tens
and hundreds of thousands of those who visit these sites, much less to distinguish between casual curiosity seekers and practicing pedophiles.
Here, broad-scale
aggregation technology, in combination with ever more sophisticated data analytics
designed to identify and track those patterns of online conduct that correlate with higher risks of
illegal on-and offline activities, would be tremendously valuable to law enforcement. Once officers
have identified a smaller universe of potential offenders, they can then further narrow their
investigative fields by using passive techniques like online honey traps to more definitively identify
those who are trafficking in or actively seeking to possess child pornography. n309 Again, although
these digital surveillance techniques and technologies are not presently subject to Fourth Amendment
review, either individually or in the aggregate, the situation would likely change under a mosaic
theory . In fact, officers might find themselves assembling informational mosaics sufficient to trigger
Fourth Amendment concerns quite by accident. n310 Regardless, law enforcement's legitimate interests in
using digital surveillance technology would be affected. n311 Fusion centers also hold significant
potential for law enforcement's efforts to detect and prosecute cyberharassment. The Department of Justice,
in conjunction with the National Center for Missing and Exploited [*799] Children, maintains a substantial database of known images of child
pornography, each of which has a unique digital fingerprint called a "hash value." n312 Fusion centers, which have access to most Internet
traffic, provide a unique - although as yet unexploited - resource that law enforcement agents can use to screen for the transmission of known
images of child exploitation. Outside
the relatively narrow field of child pornography cases, those who engage
in cyberharassment and cyberstalking still tend to use a fairly predictable pattern of words, phrases,
and images. The software used by most malicious stalkers also tends to come from a stable of online resources, which again bear an
identifiable digital signature. Although the true technical capacities of fusion centers are largely unknown to the public, they appear to have the
ability to monitor Internet and communications traffic for precisely these sorts of markers. That same capacity is, of course, precisely what
raises concerns about fusion centers from a mosaic theory point of view. Here again, the
prospect of adopting a mosaic theory
of Fourth Amendment privacy raises serious concerns that the legitimate and important law
enforcement goals of detecting and prosecuting cybercrimes may be compromised.
Harassment Turns Privacy
Cyberharrassment leads to violations of privacy and violence in the name of “Free
Speech” – this is especially true for oppressed groups
Schroder 13 - Jared C. Schroeder, doctoral candidate at the Gaylord College of Journalism & Mass
Communication at the University of Oklahoma. His research focuses on free speech and free press issues
as they apply to the emerging network society. Before moving to academia, he was a professional
journalist for several years, 2013 (“Electronically Transmitted Threats and Higher Education: Oppression,
Free Speech, and Jake Baker,” Review of Higher Education 36.3, Spring 2013, Project Muse, 7/3/15)//CM
Numerous conflicts arise when the theories of the First Amendment and concepts regarding oppression
are placed beside one another. This article does not seek to condemn one area of literature or the other. Instead, this section seeks
to illuminate areas of conflict between the two theoretical approaches. The Baker case is particularly relevant because it
captures the challenges involved in the network society, the higher education setting, and conflicts
between oppression and freedom of speech. It is not the only incident that raises questions regarding the impact of emerging
online technology on providing a safe learning atmosphere. Rutgers University student Tyler Clementi committed suicide
after his roommate filmed him having sex with another man and posted the video online (Starkman, 2010).
The roommate and another student face criminal charges for invasion of privacy. Clearly, Clementi’s
privacy was invaded in an insensitive and, likely, ignorant way. In other words, the technological abilities
of his tormentors outpaced their ethical understanding of the power of the new media. The scenario, though
even more tragic, is similar to the Baker case. New technologies allowed a person to be oppressed and tormented,
and the universities were left wondering what they could have done differently. Using Young’s (2010) definition, the young woman who was
named and described in Baker’s story, as well as others on campus, can be viewed as oppressed. While
oppression does not
automatically cross the Supreme Court’s threshold of true threats, it certainly raises questions about
the safety and viability of the learning environment. In the Baker case, oppression comes in the form of
structural norms and values; his actions can be seen as structurally accepted, to some extent, because he followed the rules created
by the dominant culture. This rule-following can be seen in the court’s reasoning for siding with Baker. While his behavior was viewed as
deviant (United States v. Alkhabaz, 1997), the
structural protections for free speech shielded him, while leaving
the young woman vulnerable. This section addresses these ideas by examining the case through the violence and cultural
imperialism concepts discussed by Young (2010). No physical violence occurred toward the female classmate Baker described in his story; but
Young (2010) noted that oppressive
violence includes [End Page 305] harassment, humiliation, and intimidation.
Young (2010) explained: “The oppression of violence consists not only in direct victimization, but in the daily
knowledge shared by all members of oppressed groups that they are liable to violation, solely on
account of their group identitiy” (p. 43). After hearing about the violent, explicit, and deadly story she
was cast in by one of her classmates, the young woman felt the effects of violent oppression. In his
dissent, Judge Krupansky wrote: “Jane Doe’s reaction to those threats when brought to her attention evinces a contrary conclusion of a
shattering traumatic reaction that resulted in recommended psychological counseling” (United States v. Alkhabaz, 1997, p. 1507). Other women
students chose not to attend class when they heard about the story. Their fear-based
response is also evidence of
oppressive violence. Members of the oppressed group were forced to alter the way they live because they felt vulnerable to violence.
Finally, the violence was made possible and somewhat acceptable by the decision of the court. Baker did not
have to stop writing and communicating his stories about the young woman. He did not have to take down his posts. The court said what he did
was legal. The
structures in place made the oppression possible.
A2 No Impact to CH
The timeframe is now. The damage that the aff does to cyber harassment has lasting
implications for future abusers and victims
Citron 09 Danielle Keats Citron is the Lois K. Macht Research Professor of Law, University of Maryland
Francis King Carey School of Law; Affiliate Scholar, Stanford Center on Internet and Society; Affiliate
Fellow, Yale Information Society Project. 2009. (“Law’s Expressive Value in Combating Cyber Gender
Harassment” Michigan Law Review, December. Available via LexisNexis. Accessed on 07-08-2015)
Due to the internet's relative youth, this is an auspicious time to combat the trivialization of cyber
gender harassment before it becomes too entrenched. If it continues unabated, cyber harassment could
very well be the central front of struggles against sexual harassment in the coming decades given our
increasing dependence on the net. More people make friends, apply for jobs, and discuss policy online
than ever before, shifting their social and professional interactions to the net and with it the risk of
sexual harassment. n18 As the market leans toward more realistic sensory experiences in virtual worlds
and as these sites become more popular, cyber gender harassment may more closely approximate
conventional notions of sexual violence. For instance, Second Life users' avatars have reportedly been
forced to perform sexually explicit acts after being given malicious code. n19 These developments, and
others like them, would further threaten gender equality in our digital age.
Wrestling with the marginalization of cyber sexual harassment is a crucial step in combating its genderspecific harms. Law has a crucial role to play in this effort. Law serves different functions here. It can
deter online [*377] harassment's harms by raising the costs of noncompliance beyond its expected
benefits. Law can also remedy such harm with monetary damages, injunctions, and criminal
convictions. My article Cyber Civil Rights explored antidiscrimination, criminal, and tort law's role in
preventing, punishing, and redressing cyber harassment. n20 In this piece, I explore law's other crucial
role: educating the public about women's unique suffering in the wake of cyber harassment and
potentially changing societal responses to it. Because law is expressive, it constructs our understanding
of harms that are not trivial. The application of a cyber civil rights legal agenda would reveal online
harassment for what it truly is - harmful gender discrimination. It would recognize the distinct suffering
of women, suffering that men ordinarily do not experience or appreciate as harmful.
Don’t let them lesson the blow to cyber harassment. The impact is real and should be
acknowledged
Citron 09 Danielle Keats Citron is the Lois K. Macht Research Professor of Law, University of Maryland
Francis King Carey School of Law; Affiliate Scholar, Stanford Center on Internet and Society; Affiliate
Fellow, Yale Information Society Project. 2009. (“Law’s Expressive Value in Combating Cyber Gender
Harassment” Michigan Law Review, December. Available via LexisNexis. Accessed on 07-08-2015)
Such harassment has a profound effect on targeted women. It discourages them from writing and
earning a living online. n5 It interferes with their professional lives. It raises their vulnerability to
offline sexual violence. It brands them as incompetent workers and inferior sexual objects. The
harassment causes considerable emotional distress. n6 Some women have committed suicide. n7
To avoid future abuse, women assume gender-neutral pseudonyms or go offline, even if it costs them
work opportunities. n8 Others curtail their online activities. n9 For the "digital native" n10 generation,
forsaking aspects of the internet means missing innumerable social connections. Although online
harassment inflicts the most direct costs on targeted individuals, it harms society as well by
entrenching male hierarchy online.
But no matter how serious the harm that cyber gender harassment inflicts, the public tends to trivialize
it. Commentators dismiss it as harmless locker-room talk, characterizing perpetrators as juvenile
pranksters and targeted individuals as overly sensitive complainers. n11 Others consider cyber gender
harassment as an inconvenience that victims can ignore or defeat with counterspeech. n12 Some
argue that women who benefit from the internet have assumed the risks of its Wild West norms. n13
Although the arguments [*376] differ, their message is the same - women need to tolerate these
cyber "pranks" or opt out of life online. This message has the unfortunate consequence of discouraging
women from reporting cyber gender harassment and preventing law enforcement from pursuing cyberharassment complaints. n14
Terrorism Impact
A strong law enforcement is key to preventing terrorist attacks
Kris 11 David S. Kris, Assistant Attorney General for National Security at the U.S. Department of Justice
from March 2009 to March 2011. 2011. (“Law enforcement as a Counterterrorism Tool,” Journal of
National Security Law & Policy
Today, law enforcement efforts against terrorism continue. In 2009, as outside observers have remarked,
the DOJ charged more individuals with significant terrorism-related offenses than in any year since
9/11. n49 That trend continued in 2010. Here are a few examples of recent terrorism charges or convictions: In June and August
2009, Syed Ahmed Harris and Ehsanul Islam Sadequee were each convicted in the Northern District of Georgia for providing material support to
al Qaeda, including videotaping potential U.S. targets. They were sentenced to 13 and 17 years in prison, respectively. In September 2009,
Michael C. Finton was arrested and charged with terrorism offenses after he attempted to detonate an explosive device outside a federal
building in Springfield, Illinois. That same month, Hosam Maher Husein Smadi was arrested and charged with attempting to detonate an
explosive device outside an office building in Dallas, Texas. Smadi pleaded guilty in May 2010 to attempting to use a weapon of mass
destruction, and he was sentenced in October 2010 to 24 years in prison. Finton is awaiting trial. Also
in September 2009,
Najibullah Zazi was arrested just before carrying out a very serious plot to bomb the New York subway
system; he pleaded guilty in February 2010 and is awaiting sentencing in the Eastern District of New
York. In October and December 2009, David Coleman Headley and Tahawwur Hussain Rana were
charged in the Northern District of Illinois with conspiracy to attack a Dutch cartoonist overseas, and
with assisting the terror attack in Mumbai, India that killed 164 people. Headley pleaded guilty in March
2010 to a dozen federal terrorism charges, admitting that he participated in planning both attacks, and
he is awaiting sentencing; Rana is awaiting trial. In May 2010, Faisal Shahzad was arrested in the
Southern District of New York in connection with an attempted car bombing in Times Square; he
pleaded guilty in June 2010 to all counts of the 10-count indictment against him, including conspiring
and attempting to use a weapon of mass destruction, conspiring and attempting to commit an act of
terrorism transcending national boundaries, attempting to use a destructive device during and in
relation to a conspiracy to commit an act of terrorism [*17] transcending national boundaries, and
transporting an explosive, among other charges. In October 2010, Shahzad was sentenced to life
imprisonment. In October 2010, James Cromitie, David Williams, Onta Williams, and LaGuerre Pen were
convicted in the Southern District of New York after a jury trial for their participation in a plot to bomb a
synagogue and Jewish community center and to shoot military planes with Stinger surface-to-air guided
missiles. Each faces a mandatory minimum sentence of 25 years and maximum of life imprisonment.
The examples go on to include Mohammed Warsame, the Minnesota al-Shabaab cases, n50 and Colleen
LaRose ("Jihad Jane"), among others. n51 [*18] Not all of these cases made the headlines and not all of
the defendants were hard-core terrorists or key terrorist operatives. The results of the cases vary
according to several factors. First, as in traditional intelligence or criminal investigations, aggressive
and wide-ranging counterterrorism efforts may net many small fish along with the big ones. Those
small fish need to be dealt with, but - if they are indeed small fish - the charges will not necessarily
yield the heavy penalties that accompany more serious offenses. n52 In some of these cases,
moreover, a conviction will support [*19] deportation (and a plea agreement may support rapid
deportation), which can mitigate threats posed to the homeland. n53 Alternatively, there are cases in
which a seemingly small fish may in fact be a big one, yet it may not be feasible either to prove that he
is, or to establish an alternative basis for detaining him, even under the law of war. These cases pose
the traditional tension between the intelligence benefit of continued surveillance and the risk to public
safety from leaving a suspected terrorist at large (in other words, a tension between the values of shortterm disruption and long-term incapacitation). In some of these cases, the risk-benefit equation will
demand immediate action, disrupting a terrorist plot through arrest and prosecution for whatever
criminal conduct can be established. Sometimes, a sentence of even a few months or years can shatter
a terrorist cell and cripple its operational ability. Finally, of course, disruptive arrests may also generate
valuable intelligence. Some small fish may be ripe for recruitment precisely because they are not fully
radicalized. Such persons may be persuaded to cooperate, either before or after they are released.
Moreover, arrests and other disruptive efforts may provoke statements or actions from others that
provide an understanding of a terrorist network - such cases effectively "shake the tree" and show
how suspects still at large respond to the arrest. Since 2001, in fact, the criminal justice system has
collected valuable intelligence about a host of terrorist activities. In effect, it has worked as what the
Intelligence Community would call a HUMINT collection platform. n54 I will first explain how the
system works as an intelligence collection platform - beginning with pre-arrest activity and ending with
sentencing and beyond - and then turn to a few illustrative examples.
Ext. Hurts Terror
The third party doctrine is key to maintaining law enforcement capabilities to combat
terrorists
Sales 14 – Nathan Alexander Sales, Associate Professor of Law, Syracuse University College of Law. This Essay
is based on testimony presented at a July 9, 2013 hearing of the Privacy and Civil Liberties Oversight Board. 2014.
(“NSA SURVEILLANCE: ISSUES OF SECURITY, PRIVACY AND CIVIL LIBERTY: ARTICLE: Domesticating
Programmatic Surveillance: Some Thoughts on the NSA Controversy” I/S: A Journal of Law and Policy for the
Information Society. Summer. Available via LexisNexis. Accessed on 07-08-2015)
The FISA court repeatedly has upheld the section 215 program on both constitutional grounds
(concluding that the acquisition of bulk telephony metadata was not a "search" within the meaning of
the Fourth Amendment, largely on the strength of the third-party doctrine recognized in Smith v.
Maryland n14 and other cases) and statutory ones (concluding that troves of data sought were tangible
things that are relevant to an authorized investigation, as required by section 215). n15 By 2013, 15
different FISA court judges had approved the program in 35 separate rulings since its inception. n16
Other judges are more divided; in a pair of dueling rulings issued late last year, a federal judge in
Washington, DC invalidated the program while another in Manhattan affirmed its legality. n17
The second program--known as PRISM or section 702--uses court orders issued under section 702 of
FISA n18 to collect the content of certain international communications. In particular, the NSA targets
specific non-Americans who are reasonably believed to be located outside the country, and also engages
in bulk collection of some foreign-to-foreign communications that happen to be passing through
telecommunications infrastructure in the United States. n19 The FISA [*527] court does not approve
individual surveillance applications each time the NSA wishes to intercept these communications;
instead, it issues once-a-year blanket authorizations. n20 As detailed below, in 2011 the FISA court
struck down the program on constitutional and statutory grounds after the government disclosed that it
was inadvertently intercepting a significant number of communications involving Americans; n21 the
court later upheld the program when the NSA devised a technical solution that prevented such overcollection. n22
Programmatic surveillance initiatives like these differ in simple yet fundamental ways from the
traditional forms of monitoring with which many people are familiar--i.e., individualized or particularized
surveillance. Individualized surveillance takes place when authorities have some reason to think that a
specific, known person is breaking the law. Investigators will then obtain a court order authorizing
them to collect information about the target, with the goal of assembling evidence that can be used to
establish guilt in subsequent criminal proceedings. Individualized surveillance is common in the world
of law enforcement, as under Title III of the Omnibus Crime Control and Safe Streets Act of 1968. n23 It
is also used in national security investigations. FISA allows authorities to obtain a court order to engage
in wiretapping if they demonstrate, among other things, probable cause to believe that the target is "a
foreign power or an agent of a foreign power." n24
By contrast, programmatic surveillance has very different objectives and is conducted in a very
different manner. It usually involves the government collecting bulk data and then examining it to
identify previously unknown terrorists, spies, and other national security threats. A good example of
the practice is link analysis, in [*528] which authorities compile large amounts of information, use it
to map the social networks of known terrorists--has anyone else used the same credit card as
Mohamed Atta?--and thus identify associates with whom they may be conspiring. n25 (It is also
possible, at least in theory, to subject these large databases to pattern analysis, in which automated
systems search for patterns of behavior that are thought to be indicative of terrorist activity, but it's not
clear that the NSA is doing so here.) Suspects who have been so identified can then be subjected to
further forms of monitoring to determine their intentions and capabilities, such as wiretaps under FISA
or other authorities. In a sense, programmatic surveillance is the mirror image of individualized
surveillance. With individualized monitoring, authorities begin by identifying a suspect and go on to
collect information; with programmatic monitoring, authorities begin by collecting information and go
on to identify a suspect.
Programmatic surveillance is a potentially powerful counterterrorism tool. The Ra'ed al-Banna
incident is a useful illustration of how the technique, when coupled with old-fashioned police work, can
identify possible threats who otherwise might escape detection. Another example comes from a 2002
Markle Foundation study, which found that authorities could have identified the ties among all 19 of
the 9/11 hijackers if they had assembled a large database of airline reservation information and
subjected it to link analysis. n26 In particular, two of the terrorists--Nawaf al-Hamzi and Khalid alMihdhar--were on a government watchlist after attending a January 2000 al-Qaeda summit in Malaysia.
So they could have been flagged when they bought their tickets. Querying the database to see if any
other passengers had used the pair's mailing addresses would have led investigators to three more
hijackers, including Mohamed Atta, the plot's operational leader. Six others could have been found by
searching for passengers who used the same frequent-flyer and telephone numbers as these suspects.
And so on. Again, the Markle study concerns airline reservation data, not the communications data that
are the NSA's focus. But it is still a useful illustration of the technique's potential.
The government claims that programmatic surveillance has been responsible for concrete and actual
counterterrorism benefits, not just hypothetical ones. Officials report that PRISM has helped detect
and [*529] disrupt about 50 terrorist plots worldwide, including ten in the United States. n27 Those
numbers include Najibullah Zazi, who attempted to bomb New York City's subway system in 2009,
and Khalid Ouazzani, who plotted to blow up the New York Stock Exchange. n28 Authorities further
report that PRISM played an important role in tracking down David Headley, an American who aided the
2008 terrorist atrocities in Bombay, and later planned to attack the offices of a Danish newspaper that
printed cartoons of Mohamed. n29 The government also claims at least one success from the telephony
metadata program, though it has been coy about the specifics: "The NSA, using the business record FISA,
tipped [the FBI] off that [an] individual had indirect contacts with a known terrorist overseas. . . . We
were able to reopen this investigation, identify additional individuals through a legal process and were
able to disrupt this terrorist activity." n30 Quite apart from foiling attacks, the government also argues
that the NSA programs can conserve scarce investigative resources by helping officials quickly spot or
rule out any foreign involvement in a domestic plot, as after the 2013 Boston Marathon bombing. n31
SEC DA
Shell
1nc
SEC enforcement works in the squo – it’s strong and aggresive
Wiggin and Dana 2014, (A full service law firm -- clients are publicly traded companies,
entrepreneurs and emerging growth companies, real estate developers, financial institutions,
“TIME TO FOCUS ON COMPLIANCE PROGRAMS AGAIN: SEC ENFORCEMENT ACTIONS AND SANCTIONS
ARE ON THE RISE”, 10/31/2014, http://www.wiggin.com/15507) BBer
Probably to no one's surprise, given the SEC's much publicized enforcement efforts, the Commission has announced that it
filed a record number of enforcement actions over the last three fiscal years and secured record
payouts in penalties and disgorgements.[1] Over this period, the SEC has taken aim at a broad
spectrum of conduct in the securities markets and targeted a diverse range of market actors. Although
the SEC has divided its focus across a range of different areas, three themes have emerged from its
increased enforcement activity . First, the SEC has aggressively targeted lapses in regulatory
compliance and risk controls over a broad spectrum of conduct and industries. Second, the SEC has
increasingly relied on technology to detect such misconduct. And third, the SEC has made substantial
awards to whistleblowers for providing information that has led to successful enforcement actions.
Considering this increase in enforcement activity, companies and individuals engaged in business
relating to the financial industry need to be prepared to meet the SEC's heightened scrutiny. With this in
it is a good time to revisit compliance programs, policies and procedures to assure they are up-todate and focus on the concerns of the SEC and requirements of the securities laws. According to a recent press release, the
Commission reported that it had filed a record high of 755 enforcement actions in Fiscal Year ("FY") 2014.
Along with those actions was another high mark: orders for penalties and disgorgement in the amount of
$4.16 billion. That reflects a 22% increase in penalties and disgorgement as a result of SEC
enforcement actions over last year. In FY 2013, the Commission filed 686 enforcement actions and obtained orders totaling $3.4
mind,
billion in disgorgement and penalties. In FY 2012, the Commission filed 734 enforcement actions and obtained orders totaling $3.1 billion in
disgorgement and penalties. The
SEC continued to crack down on traditional financial fraud, charging more
than 135 parties with violations relating to reporting and disclosure. At the same time, it continued its
focus on misconduct relating to complex financial instruments such as mortgage-backed securities and
collateralized debt obligations, and it brought several novel actions targeting deficient compliance and
control practices. For example, the SEC successfully held global investment bank and brokerage firm Jefferies LLC responsible for its
failure to properly supervise trading on its mortgage-backed securities desk. The SEC also brought actions, for the first time,
under a rule requiring firms to establish adequate risk controls before providing customers with
market access. It imposed the largest penalty ever for net capital rule violations in a case against a
high frequency trading firm and a former senior executive. And it also filed enforcement actions
against the New York Stock Exchange and brokerage subsidiaries for their failure to comply with
exchange rules, and Wells Fargo Advisors LLC in the Commission's first case against a broker-dealer for failing to protect a customer's
material nonpublic information. The compliance and control practices and procedures of private equity firms, investment advisers and
investment companies were also in the SEC's line of sight. According to the Commission, it brought its first-ever action under the investment
adviser "pay-to-play" rule. The SEC also filed its first action arising from a focus on fees and expenses charged by private equity firms. It also
instituted an action against a private equity firm and its president, alleging fraud in the allocation of
expenses to the firm's funds. Finally, the Commission charged three investment advisory firms with failure to maintain adequate
controls on the custody of customer accounts. Accountants, attorneys and compliance professionals also found themselves contending with
SEC enforcement actions this past year. In one matter, the SEC filed an action against Ernst & Young LLP relating to auditor independence rules.
In another, the SEC filed an action against an audit firm and four of its auditors for their roles in the failed audits of three China-based
companies. The Commission charged two Florida-based attorneys, a transfer agent and its CEO for their roles in an offering fraud involving
improper distributions of billions of shares of unregistered stock. Finally, in a fraud case, the Commission charged a company's audit committee
chair, who learned of the misconduct in question and failed to take meaningful action to investigate it or disclose it to investors. The SEC also
touted its success in using new technologies to detect market misconduct over the last three years. SEC Chair Mary Jo White stated that "[t]he
innovative use of technology – enhanced use of data and quantitative analysis – was instrumental in detecting misconduct and contributed to
the Enforcement Division's success in bringing quality actions that resulted in stiff monetary sanctions." The SEC successfully used quantitative
analytics to identify especially high rates of filing deficiencies and brought coordinated charges against 34 individuals and companies for
violating laws requiring them to promptly report information about their holdings and transactions in company stock. The SEC pursued
wrongdoing by asset managers through proprietary analytics that identify hedge funds with suspicious returns. It also employed "next
generation analytical tools to help identify patterns of suspicious trading" in its continued efforts to eliminate trading on the basis of inside
information. Over the last three years, the SEC charged 80 people in connection with insider trading and, among those charged are a former
hedge fund trader, a portfolio manager, the co-chairman of a board, an investment banker, an investor relations executive, an accountant,
husbands who traded on information they learned from their wives, and a group of golf buddies and other friends. There is every reason to
expect that the continued use of these techniques will lead to more enforcement actions across a broad spectrum of market conduct. Lastly,
the SEC's record payout of awards to whistleblowers is bound to incentivize whistleblowers to come
forward and may lead to more prosecutions of individuals . In FY 2014, nine whistleblowers received awards totaling
approximately $35 million, including one that was more than $30 million for a whistleblower who provided key original information that led to
a successful enforcement action. That award was the largest-ever whistleblower award. The
Commission also demonstrated its
commitment to protect whistleblowers in that it brought its first charges under new authority to bring
anti-retaliation enforcement actions. In that case, the SEC charged a hedge fund advisory firm with engaging in prohibited
principal transactions and then retaliating against the employee who reported the trading activity to the Commission. It also charged the firm's
owner in connection with the principal transactions. In terms of actions against individuals in addition to companies, as U.S. Attorney General
Eric Holder recently remarked, cases against individuals are more easily brought when there is a witness who is able to provide evidence of a
corporate executive's knowledge of and intent to participate in wrongdoing.[2] Those witnesses are more incentivized to come forward when
there is a robust whistleblower program. Undoubtedly, the recent provision of substantial awards to whistleblowers will provide such incentive
for people to come forward when they are aware of possible illegal conduct and may lead to increasingly vigorous investigation and
enforcement activity against not only companies but also individuals. According to Chair White over the last three years,
"aggressive
enforcement against wrongdoers who harm investors and threaten our financial markets remains a
top priority, and we brought and will continue to bring creative and important enforcement actions
across a broad range of the securities markets. " As Chair White's and the Commission's statements reflect, the SEC is
committed to using modern data analytics and investigative techniques to monitor the securities
markets and enforce the securities laws. Further, whistleblower awards and legal mechanisms designed to protect
whistleblowers from retaliation by their employers have made it more likely that people in possession of information relating to possible
wrongdoing will report it to law enforcement authorities and both corporations and individuals will be prosecuted on the basis of that
information. Moreover, the SEC continues to hone in on firms' deficient compliance and control practices through bringing novel actions
charging companies with violating various laws and rules. Thus,
companies and individuals engaged in business relating
to the financial industry should expect to encounter even more aggressive enforcement of the
securities laws from the SEC. Going forward, a company's compliance programs, policies and
procedures will likely be subject to heightened scrutiny by the SEC. With this in mind, now is a good time to reevaluate compliance programs and internal controls to assure that they are up-to-date, that best practices have been adopted and are being
followed, and that, importantly, they adequately address the SEC's concerns.
Requiring a probable cause warrant would obliterate routine investigations — no
authority to require a warrant and lack of evidence to receive one.
Baker 11 — James A. Baker, Associate Deputy Attorney General, Statement before the Committee on
Judiciary United States Senate, 2011 ("The Electronic Communications Privacy Act: Government
Perspectives on Protecting Privacy in the Digital Age," American Civil Liberties Union, April 6th, Available
Online at https://www.aclu.org/files/pdfs/email-content-foia/DOJ%20Crim%20Div%20docs/CRM231.pdf, Accessed on 07-08-15)
Finally, the eighth and last potentially appropriate topic for legislation is the standard for compelling
disclosure of the contents of stored communications. As noted above, we appreciate that there are
concerns regarding ECPA's treatment of stored communications - in particular, the rule that the
government may use lawful process short of a warrant to obtain the content of emails that are stored
for more than 180 days. Indeed, some have argued recently in favor of a probable cause standard for
compelling disclosure of all such content under all circumstances. Because communication services are
provided in a wide range of situations, any simple rule for compelled disclosure of contents raises a
number of serious public safety questions. In considering whether or not there is a need to change
existing standards, several issues are worthy of attention. First, current law allows for the acquisition
of certain stored communications using a subpoena where the account holder receives prior notice.
This procedure is similar to that for paper records. If a person stores documents in her home, the
government may use a subpoena to compel production of those documents. Congress should
consider carefully whether it is appropriate to afford a higher evidentiary standard for compelled
production of electronically stored records than paper records. Second, it is important to note that
not all federal agencies have authority to obtain search warrants. For example, the Securities and
Exchange Commission (SEC) and Federal Trade Commission (FTC) conduct investigations in which they
need access to information stored as the content of email. Although those entities have authority to
issue subpoenas, they lack the ability to obtain search warrants. Raising the standard for obtaining
stored email or other stored communications to a search warrant could substantially impair their
investigations. Third, Congress should recognize the collateral consequences to criminal law
enforcement and the national security of the United States if ECPA were to provide only one means —
a probable cause warrant — for compelling disclosure of all stored content. For example, in order to
obtain a search warrant for a particular email account, law enforcement has to establish probable
cause to believe that evidence will be found in that particular account. In some cases, this link can be
hard to establish. In one recent case, for example, law enforcement officers knew that a child
exploitation subject had used one account to send and receive child pornography, and officers
discovered that he had another email account, but they lacked evidence about his use of the second
account. Thus, Congress should consider carefully the adverse impact on criminal as well as national
security investigations if a probable cause warrant were the only means to obtain such stored
communications.
Insider Trading will lead to the collapse of the stock market and SEC regulation
prevents that
Dent ‘12, George W. Dent JR,Professor of Law at Case Western University, 2012 (“Why Legalized
Insider Trading Would Be a Disaster”, November 2012, Available Online at
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2169975,Accessed 07/08/15)
The ban on insider trading probably has something to do with this:100 Stock traders are more sophisticated now than in the 1920s. Most
traders then were individuals, many of whom were buying stock for the first time and knew little of the risks, including insider trading, until
they were rudely educated by the 1929 stock market crash.102 Today, most trading is done by institutions that are keenly aware of such
risks.103 Furthermore, in the 1920s, no foreign stock markets barred insider trading, so investors had no better alternative than the American
markets.104 Today, all
developed countries ban insider trading.105 If America were to legalize insider
trading, investors would simply go elsewhere.106 Legalizing insider trading could effectively destroy public
stock markets.107 Defenders of insider trading claim that it does not harm outsiders.108 Although it is virtually impossible to identify the
victims of any particular act of insider trading, it is easy to see that it must hurt outside investors collectively.109
Imagine two publicly traded companies with identical operations. In one there is some significant amount of insider trading; in the other there
is none. In the former, insiders siphon
off some of the profits from the stock. Accordingly, outsiders must value
its stock lower than the stock of the latter company.110 Nonetheless, as long as the level of insider trading
stays low, the potential profits to outsiders are still high enough to attract them to purchase the stock
at some price.111 This all changes once insider trading is permitted, as it is hard to see how there could be
any other trading.112 Insiders will trade whenever no higher returns are attainable from other investments (e.g., real estate).113
Imagine being asked to bid on a bag whose contents you do not know, but that are known to another bidder. The informed bidder
will raise her bid unless and until you bid more than the bag's fair value. No reasonable person would
enter such a contest.114 It is suggested that insider trading will not scare off outsiders because they "already disregard a large body of
evidence indicating that even the most sophisticated institutions have difficulty outperforming the stock market averages. . . . These investors
may be convinced that certain stocks will make them money; the occurrence of insider trading may have little effect on investment so
motivated."115 Not all "uninformed" traders, however, are so naive.116 Even investors
familiar with the efficient market
hypothesis buy and sell stock when they want to make additional investments, disinvest, or better
diversify their portfolios.117 As already noted, the public market in a stock can survive some level of insider trading.118 To
compensate for the gains siphoned off by insiders, the market will discount a stock's price to allow rational trading
by outsiders.119 In an efficient market, uninformed investors cannot beat the market, but neither will they underperform other outsiders,
"even the most sophisticated institutions."120 They will invest in stocks if the stock market outperforms other
available investments.121 In the long run, it does.122 If insider trading becomes rampant, however, the only
trades left on the table for outsiders will be those that insiders have spurned because they offer a
lower return than is available elsewhere.123 Not even the most sophisticated mutual fund could match
the performance of even a minimally skilled insider. In such a world only a fool would utilize anything but
an insider trading equity fund to trade stock.124 Not even through examining foreign experience can we adequately tell how
stock markets would fare under legalized insider trading because "all countries with developed capital markets limit insider trading to some
extent."125 However, the breadth and enforcement of the prohibitions vary, and stricter
insider trading bans are associated
with wider stock ownership, better stock price accuracy, and deeper market liquidity. 126 The corporate cost
of equity declines significantly when a country forbids insider trading and actually enforces the law. Countries that more effectively
bar insider trading have less volatile stock markets.128 So it is no surprise that whenever the SEC announces
enforcement actions involving insider trading, the price of the affected stock declines.129 All this
evidence contradicts the market efficiency arguments for insider trading. Although less of the pie remains for
outsiders if more of it is taken by inside traders, outsiders might still be better off if insider trading spurs innovation, thereby causing the pie to
expand.130 In that case however, companies in markets that allow insider trading should have a lower cost of capital, and revelations of
possible insider trading in a company's stock should cause its stock price to rise.131 The evidence just discussed demonstrates that the opposite
is true. Outsiders might be able to share in superior profits by investing in insider trading equity funds. However, as already suggested, insiders
will probably have little need to create such funds because they will be able to finance most or all of their trading with (cheaper) debt.132 Thus,
everyone but insiders would abandon the stock market.133 As an obvious consequence, public trading in stocks
would essentially cease.134 Insiders can trade only if there are outsiders (including market makers)135 with whom
to trade. If outsiders pull out, that is associated with a reduction in the cost of equity in a country trading
, there would be no stock market; there would be no publicly traded companies.136 It would not, however, be
tenable to have all the equity of large firms owned by just a few insiders; that is why public ownership originally evolved. If public
ownership were destroyed by insider trading, large firms would have to seek investment from private
equity companies.137 In most cases, private equity owners demand control.138 As part of that control,
they also insist on full disclosure when executives buy or sell the firm's stock.139 In other words, they
do not tolerate insider trading. Thus, ironically, legalizing insider trading would lead to the extinction of
public stock markets and of insider trading itself. Although unrestricted insider trading would destroy the stock markets and
thus preclude insider trading, could market forces somehow react so as to prevent this destruction? It is true that individual insiders
would have no incentive to restrain their trading,140 but, as a response, individual companies could try to
curb insider trading.141
Stock Market Key to the Global Economy
Naes ’11, Writer for the Journal of Finance, Randi Naes, 2011 (“Stock Market Liquidity and the
Business Cycle”, Journal of Finance, February 2011, Available Online at
http://onlinelibrary.wiley.com/doi/10.1111/j.1540-6261.2010.01628.x/pdf, Accessed 07/10/2015)
IN DISCUSSIONS OF THE CURRENT financial crisis, much is made of the apparent causality between a decline
in the liquidity of financial assets and the economic crisis. In this paper we show that such effects are not new;
changes in the liquidity of the U.S. stock market have been coinciding with changes in the real
economy at least since the Second World War. In fact, stock market liquidity is a very good “leading indicator” of
the real economy. Using data for the United States over the period 1947 to 2008, we document that
measures of stock market liquidity contain leading information about the real economy, even after
controlling for other asset price predictors. Figure 1 provides a time-series plot of one measure of market liquidity, the Amihud
(2002) measure, together with the National Bureau of Economic Research (NBER) recession periods (gray bars). This figure illustrates the
relationship found between stock market liquidity and the business cycle. As can be seen from the figure, liquidity clearly worsens (illiquidity
increases) well ahead of the onset of the NBER recessions. Our results are relevant for several strands of the literature. One important strand is
the literature on forecasting economic growth using different asset prices, including interest rates, term spreads, stock returns, and exchange
rates. The forward-looking nature of asset markets makes the use ∗Randi Næs is at the Norwegian Ministry of Trade and Industry. Johannes A.
Skjeltorp is at Norges Bank (the Central Bank of Norway). Bernt Arne Ødegaard is at the University of Stavanger, Norges Bank, and Norwegian
School of Management. We are grateful for comments from an anonymous referee, an associate editor, and our Editor (Campbell Harvey). We
also thank Kristian Miltersen, Luis Viceira, and seminar participants at the fourth Annual Central Bank Workshop on the Microstructure of
Financial Markets in Hong Kong, Norges Bank, the Norwegian School of Economics and Business Administration, Statistics Norway (SSB), Center
for Research in Economics and Statistics, and the Universities of Oslo, Stavanger, and Aarhus for comments. Ødegaard acknowledges funding
from “Finansmarkedfondet” (The Finance Market Fund). The views expressed are those of the authors and should not be interpreted as
reflecting those of Norges Bank or the Ministry of Trade and Industry. 139 140 The Journal of FinanceR -1.2 -0.8 -0.4 0.0 0.4 0.8 1.2 1950 1960
1970 1980 1990 2000 NBER recessions ILR detrended Figure 1. Liquidity and the business cycle. The figure shows time-series plots of the
detrended Amihud (2002) illiquidity ratio (ILR) for the United States over the period 1947 to 2008. The gray bars indicate the NBER recession
periods. ILR is an elasticity (price impact) measure of liquidity and reflects how much prices move in response to trading volume. ILR is first
calculated for each stock for each year. Then the equally weighted cross-sectional average for each year is calculated. A more precise definition
is found in equation (2) in the paper. Note that ILR reflects illiquidity, so a high value reflects a high price impact of trades (i.e., low liquidity). ILR
is detrended using a Hodrick–Prescott filter. of these prices as predictors of the real economy intuitive. If a stock price equals the expected
discounted value of future earnings, it seems natural that it should contain information about future earnings growth. Theoretically, a link
between asset prices and the real economy can be established from a consumption–smoothing argument. If investors
are willing to
pay more for an asset that pays off when the economy is thought to be in a bad state than for an asset
that pays off when the economy is thought to be in a good state, then current asset prices should
contain information about investors’ expectations about the future real economy. In their survey article,
however, Stock and Watson (2003) conclude that there is considerable instability in the predictive power of asset prices. We shift focus to a
different aspect of asset markets: the liquidity of the stock market (i.e., the costs of trading equities). It is a common observation that stock
market liquidity tends to dry up during economic downturns. However, we show that the relationship
between trading costs and the real economy is much more pervasive than previously thought. A link from
trading costs to the real economy is not as intuitive as the link from asset prices, although several possible explanations are suggested in the
literature.
Economic decline triggers lash-out and global war---no checks
Harold James 14, Professor of history at Princeton University’s Woodrow Wilson School who
specializes in European economic history, 7/2/14, “Debate: Is 2014, like 1914, a prelude to world war?,”
http://www.theglobeandmail.com/globe-debate/read-and-vote-is-2014-like-1914-a-prelude-to-worldwar/article19325504/
As we get closer to the centenary of Gavrilo Princip’s act of terrorism in Sarajevo, there is an ever more vivid fear: it could happen
again . The approach of the hundredth anniversary of 1914 has put a spotlight on the fragility of the world’s
political and economic security systems . At the beginning of 2013, Luxembourg’s Prime Minister Jean-Claude Juncker was widely
ridiculed for evoking the shades of 1913. By now he is looking like a prophet. By 2014, as the security situation in the South
China Sea deteriorated, Japanese Prime Minister Shinzo Abe cast China as the equivalent to Kaiser Wilhelm’s Germany; and the
fighting in Ukraine and in Iraq is a sharp reminder of the dangers of escalation. Lessons of 1914 are about more
than simply the dangers of national and sectarian animosities. The main story of today as then is the precariousness of
financial globalization , and the consequences that political leaders draw from it. In the influential view of Norman Angell in his 1910
book The Great Illusion, the interdependency of the increasingly complex global economy made war
impossible. But a quite opposite conclusion was possible and equally plausible – and proved to be the
case . Given the extent of fragility, a clever twist to the control levers might make war easily winnable
by the economic hegemon. In the wake of an epochal financial crisis that almost brought a complete
global collapse, in 1907, several countries started to think of finance as primarily an instrument of raw
power, one that could and should be turned to national advantage. The 1907 panic emanated from the United States but affected the rest of
the world and demonstrated the fragility of the whole international financial order. The aftermath of the 1907 crash drove the then hegemonic
power – Great Britain - to reflect on how it could use its financial power. Between 1905 and 1908, the British Admiralty evolved the broad
outlines of a plan for financial and economic warfare that would wreck the financial system of its major European rival, Germany, and destroy
its fighting capacity. Britain used its extensive networks to gather information about opponents. London banks financed most of the world’s
trade. Lloyds provided insurance for the shipping not just of Britain, but of the world. Financial networks provided the information that allowed
the British government to find the sensitive strategic vulnerabilities of the opposing alliance. What pre-1914 Britain did anticipated the privatepublic partnership that today links technology giants such as Google, Apple or Verizon to U.S. intelligence gathering. Since last year, the Edward
Snowden leaks about the NSA have shed a light on the way that global networks are used as a source of intelligence and power. For Britain’s
rivals, the financial panic of 1907 showed the necessity of mobilizing financial powers themselves. The United States realized that it needed a
central bank analogous to the Bank of England. American financiers thought that New York needed to develop its own commercial trading
system that could handle bills of exchange in the same way as the London market. Some of the
dynamics of the pre-1914
financial world are now re-emerging. Then an economically declining power, Britain, wanted to use
finance as a weapon against its larger and faster growing competitors, Germany and the United States. Now America is in turn
obsessed by being overtaken by China – according to some calculations, set to become the world’s largest economy in 2014. In
the aftermath of the 2008 financial crisis, financial institutions appear both as dangerous weapons of
mass destruction , but also as potential instruments for the application of national power. In managing the 2008 crisis, the dependence
of foreign banks on U.S. dollar funding constituted a major weakness, and required the provision of large swap lines by the Federal Reserve. The
United States provided that support to some countries, but not others, on the basis of an explicitly political logic, as Eswar Prasad demonstrates
in his new book on the “Dollar Trap.” Geo-politics is intruding into banking practice elsewhere. Before the Ukraine crisis, Russian banks were
trying to acquire assets in Central and Eastern Europe. European and U.S. banks are playing a much reduced role in Asian trade finance. Chinese
banks are being pushed to expand their role in global commerce. After the financial crisis, China started to build up the renminbi as a major
international currency. Russia and China have just proposed to create a new credit rating agency to avoid what they regard as the political bias
of the existing (American-based) agencies. The next stage in this logic is to think about how financial power can be directed to national
advantage in the case of a diplomatic tussle. Sanctions are a routine (and not terribly successful) part of the pressure applied to rogue states
such as Iran and North Korea. But financial pressure can be much more powerfully applied to countries that are deeply embedded in the world
economy. The test is in the Western imposition of sanctions after the Russian annexation of Crimea. President Vladimir Putin’s calculation in
response is that the European Union and the United States cannot possibly be serious about the financial war. It would turn into a boomerang:
Russia would be less affected than the more developed and complex financial markets of Europe and America. The
threat of systemic
disruption generates a new sort of uncertainty, one that mirrors the decisive feature of the crisis of the
summer of 1914. At that time, no one could really know whether clashes would escalate or not. That
feature contrasts remarkably with almost the entirety of the Cold War, especially since the 1960s, when the strategic doctrine of
Mutually Assured Destruction left no doubt that any superpower conflict would inevitably escalate .
The idea of network disruption relies on the ability to achieve advantage by surprise, and to win at no or low cost. But it is inevitably a gamble,
and raises prospect that others might, but also might not be able to, mount the same sort of operation. Just as in 1914, there is an
enhanced temptation to roll the dice, even though the game may be fatal.
Uniqueness
Insider Trading Low
Insider activity low – SEC enforcement
Wiggin and Dana 10/31, (A full service law firm -- clients are publicly traded companies,
entrepreneurs and emerging growth companies, real estate developers, financial institutions,
“TIME TO FOCUS ON COMPLIANCE PROGRAMS AGAIN: SEC ENFORCEMENT ACTIONS AND SANCTIONS
ARE ON THE RISE”, 10/31/2014, http://www.wiggin.com/15507) BBer
The SEC successfully used quantitative analytics to identify especially high rates of filing deficiencies and
brought coordinated charges against 34 individuals and companies for violating laws requiring them to
promptly report information about their holdings and transactions in company stock. The SEC pursued
wrongdoing by asset managers through proprietary analytics that identify hedge funds with
suspicious returns. It also employed "next generation analytical tools to help identify patterns of
suspicious trading" in its continued efforts to eliminate trading on the basis of inside information.
Over the last three years, the SEC charged 80 people in connection with insider trading and, among
those charged are a former hedge fund trader, a portfolio manager, the co-chairman of a board, an
investment banker, an investor relations executive, an accountant, husbands who traded on
information they learned from their wives, and a group of golf buddies and other friends. There is every
reason to expect that the continued use of these techniques will lead to more enforcement actions
across a broad spectrum of market conduct. Lastly, the SEC's record payout of awards to
whistleblowers is bound to incentivize whistleblowers to come forward and may lead to more
prosecutions of individuals. In FY 2014, nine whistleblowers received awards totaling approximately
$35 million, including one that was more than $30 million for a whistleblower who provided key original
information that led to a successful enforcement action. That award was the largest-ever
whistleblower award
Inside trading is on a decline
Nili 3/18, (Yaron, Co-Editor on the Harvard law school forum on Corporate Governance and Financial
Regulation – Went to The Hebrew University: M.B.A., Finance - LL.B., Law --- Activities and Societies:
Teaching assistant, "Mishpatim" Law review editor-in-chief, “SEC Enforcement Developments in 2014,
and a Look Forward", Harvard Law School, 3-18-2015, http://corpgov.law.harvard.edu/2015/03/18/secenforcement-developments-in-2014-and-a-look-forward/) BBer
Substantive Developments Insider Trading Law The year 2014 may have seen the rolling back of the
tide of successful insider trading cases brought both by the Manhattan US Attorney’s Office and the SEC. Last year saw
the SEC bring 52 insider trading actions, charging 80 people, an increase over the 44 cases brought in
2013. Already, the US Attorney’s Office has filed a brief in another insider trading case, United States v. Durant,
arguing that the Second Circuit decision should be construed narrowly. The government argued that, while “[t]he Newman decision
dramatically (and, in our view, wrongly) departs from thirty years of controlling Supreme Court authority,” the decision does not apply in
Durant. Newman applies to insider trading cases brought under the classical theory of liability the government argued, while Durant was
brought under the misappropriation theory.
Insider trading is low – increase in prosecutions and SEC enforcement
Morrison and Foerster 2/21, (Law firm – includes prominent attorneys with decades of experience,
former prosecutors, former SEC enforcement attorneys, former senior officials of the CFTC and FINRA,
and in-house forensic accounting experts, “2014 Insider Trading: Annual Review”, 2/21/2015,
http://www.mofo.com/~/media/Files/ClientAlert/2015/02/150211InsiderTradingAnnualReview.pdf)
BBer
2014 will be remembered as the year that the Department of Justice’s (“DOJ”) winning streak in
insider trading cases came to an end. The last few years have been punctuated by the government’s
aggressive – and highly successful – enforcement of criminal insider trading laws.
Attorney’s Office for the Southern District of New York
(“S.D.N.Y.”)
Since 2009,
the U.S.
had enjoyed a perfect trial record in
insider trading cases. With the high-profile trial conviction of Mathew Martoma, 2014 was poised to be another banner year.
However, in July 2014 the perfect record came to an end when a jury acquitted Rajarengan (Rengan) Rajaratnam of insider trading charges.
Rengan’s acquittal not only ended the government’s seemingly endless winning streak, but also signified the end of the longrunning “Perfect
Hedge” investigation that initially ensnarled his brother, Raj Rajaratnam, and brought down most of the insider trading defendants over the last
few years. To close out 2014, the United States Court of Appeals for the Second Circuit issued the highly anticipated decision overturning the
insider trading convictions of Todd Newman and Anthony Chiasson. The blockbuster opinion cast doubt on countless other convictions and
guilty pleas secured over the past several years. The early effects of the decision have already been felt in the first few weeks of 2015, with a
number of associated guilty pleas by downstream tippees having been vacated. The U.S. Attorney’s Office for the S.D.N.Y. is not going quietly;
instead, it filed a blistering petition for rehearing and suggestion for rehearing en banc, arguing that the panel not only got it wrong, but also
“threaten[ed] the integrity of the securities markets.” The viability of the panel opinion and its ripple effects are among the central events to
watch in insider trading law in 2015. The
consequences of being found liable for insider trading can be severe.
Individuals convicted of criminal insider trading can face up to 20 years imprisonment per violation,
criminal forfeiture, and fines of up to $5,000,000 or twice the gain from the offense. A successful civil
action by the SEC may lead to disgorgement of profits and a penalty not to exceed the greater of
$1,000,000, or three times the amount of the profit gained or loss avoided. In addition, individuals can be
barred from serving as an officer or director of a public company, acting as a securities broker or investment adviser, or in the
case of licensed professionals, such as attorneys and accountants, from serving in their professional capacity before the SEC. In 2014, the
SEC filed insider trading actions against 111 individuals or entities, naming 44 of them in
administrative proceedings, while DOJ brought criminal charges involving insider trading against 20
individuals or entities.
Last year in our Review, we included in our tally for the first time administrative proceedings filed by the SEC.
With the increasing preference by the SEC Staff to bring actions as administrative proceedings instead of federal court cases, reporting only on
the number of SEC enforcement actions would give an incomplete picture of enforcement activity.
As we predicted last year, the
trend towards filing administrative proceedings continued in 2014 . 2014 saw DOJ and the SEC
continue to aggressively pursue insider trading actions. The total number of actions brought
demonstrates that neither agency has lost its interest in enforcing insider trading laws. While 2014
certainly brought some high-profile victories for the government, 2014 will likely be better
remembered for the significant set-backs suffered by both DOJ and the SEC. There are a number of potential
explanations for the disparity in sentences inside and outside the S.D.N.Y. In recent years, prosecutors in the S.D.N.Y . compiled an
impressive win record , largely with the benefit of cooperating witnesses in a series of related actions. The success
of that approach may have provided additional incentive for prosecutors to encourage cooperation by
recommending sentences of probation for cooperators. In addition, because there are more insider trading cases
brought in the S.D.N.Y. than in all other districts combined, judges in the S.D.N.Y. may be less likely to impose as harsh a sentence on a
cooperator as might a judge for which insider trading cases are more novel.
2014 was another big year for insider trading
cases.
Insider trading prosecution on the rise – cooperation
Morrison and Foerster 2/21, (Law firm – includes prominent attorneys with decades of experience,
former prosecutors, former SEC enforcement attorneys, former senior officials of the CFTC and FINRA,
and in-house forensic accounting experts, “2014 Insider Trading: Annual Review”, 2/21/2015,
http://www.mofo.com/~/media/Files/ClientAlert/2015/02/150211InsiderTradingAnnualReview.pdf)
BBer
The 2014 sentencing data stands out in a number of ways. First, ten cooperators received prison time in
2014, more than had been sentenced to prison in the prior four years combined, even though the
number of cooperators sentenced in 2014 was less than in 2013 and equal to 2012. Second, the gap in
expected outcomes between cooperators and those who go to trial has narrowed substantially if one
factors in the reversal of the Newman and Chiasson convictions, the doubt that ruling casts upon the Steinberg and Martoma convictions, and
DOJ’s loss in the Rengan Rajaratnam trial. In short, defendants can now factor in a real chance of acquittal if they go to trial, whereas conviction
seemed all but inevitable just one year ago. If the Newman holding remains undisturbed and is followed in other circuits,
we may well
see a reduction in the absolute number of insider trading criminal cases (and SEC enforcement
actions), as prosecutors forgo hard-to-win remote tippee cases. Despite these developments, however, it
remains true that cooperators receive lower prison sentences (on average 25% of the minimum guidelines in 2014), as
compared to settling defendants who do not cooperate (35% of the minimum guidelines in 2014), and those who go to trial (35% of the
minimum guideline in 2014). In total over the last five years, the numbers are more stark: cooperators
received prison
sentences of approximately 11% of the minimum guidelines on average, as compared to 43% for
settling non-cooperators, and 45% for those who went to trial. The benefits of cooperation in 2014
also remained the most pronounced in the S.D.N.Y. The one cooperator sentenced in the S.D.N.Y. in 2014, Reemah Shah,
received no prison time, whereas numerous non-cooperators received substantial prison time. In contrast, seven cooperators outside the
S.D.N.Y. were sentenced to prison for more than one year, and non-cooperators’ prison sentences were generally not as high outside the
S.D.N.Y.
The aggregate sentencing data from 2010 through 2014 shows a clear trend.
SEC investigations work
SEC investigations successful
Eaglesham 14, (Jean, writes about law enforcement by the Securities and Exchange Commission and
other financial agencies, working from the Wall Street Journal's New York bureau, "As SEC Enforcement
Cases Rise, Big Actions Are Sparse", WSJ, 9-29-2014, http://www.wsj.com/articles/as-sec-enforcementcases-rise-big-actions-are-sparse-1412028262) BBer
Mary Jo White will end her first full fiscal year running the Securities and Exchange Commission able
to claim an increase in its annual tally of cases, the first year-over-year rise since 2011, according to people
close to the agency. It is an important benchmark for the SEC chairman, a former federal prosecutor who promised "aggressive and
creative" enforcement soon after taking office last year. But some SEC watchers said the heightened activity masks
a scarcity of the blockbuster actions that should be a feature of an effective Wall Street cop. "When the
chairman testifies before Congress…she will have nice numbers to cite," said Thomas Gorman, a partner at law firm Dorsey & Whitney LLP. "But
she's not going to have the really good cases that the SEC made its reputation on." Ms. White said
the SEC's enforcement division
has been highly successful in the past year, and aggressive enforcement will continue . " What is most
impressive is that the cases span the spectrum of the securities markets and that we demanded tough
remedies ," she said in a statement. The SEC is still completing its official tally of enforcement actions for the
fiscal year ending Tuesday. But a recent flurry of activity has boosted total enforcement actions, one
of the agency's measures of success, to well over the 686 reached in the previous 12-month period, the
people close to the agency said. Ms. White can also point to recent progress on two of her priorities. Her policy of requiring
admissions of wrongdoing to settle SEC allegations in some cases has produced 12 such pacts, the most
recent last week, according to an analysis by The Wall Street Journal. And her "broken windows" strategy of pursuing even
small legal violations led to 54 new cases this month, a handy addition to the annual tally, according
to the analysis. Senior SEC officials said the agency under Ms. White is moving on from its effort to punish
misconduct related to the financial crisis, which dominated the five years after 2008 . But such actions still
accounted for more than half of its biggest-penalties cases in this fiscal year, according to the analysis by the Journal. Four of seven cases with
settlements of more than $100 million brought by the SEC in the past 12 months, including the three biggest fines, involve conduct dating back
to the financial crisis, the analysis found. Three of these seven
$100 million-plus cases included admissions of
wrongdoing by the firm involved, reflecting the agency's determination to require admissions in some
of its most important cases. But the 12 pacts with admissions reached under the new policy also
include alleged misconduct that resulted in much smaller penalties, in which fraud wasn't alleged,
such as a computer-coding error that resulted in a discount brokerage giving incorrect data to the SEC .
"When you look at the [admissions] cases they've brought so far, it's hard to understand why those have been selected and not others," said
Stephen Crimmins, a partner at law firm K&L Gates LLP. Andrew Ceresney, SEC enforcement chief, said all 12 admissions "are important cases
that warranted admissions, which enhanced the defendants' acceptance of responsibility for their actions." The SEC has chalked up some
notable firsts under Ms. White. This month alone, the agency made a record $30 million payout to a whistleblower and filed its first
enforcement action against a high-frequency trading firm, as well as its first case against a brokerage firm for failing to protect customers'
nonpublic information. Senior SEC officials said the agency's postcrisis strategy is to pursue wrongdoing on a broad range of fronts, on both
"Now that we have completed nearly all of our
financial crisis cases, we will increase our focus in a range of different areas," said Mr. Ceresney. The types
Wall Street and Main Street, rather than target any particular area.
of cases being targeted include insider trading, market structure, microcap-stock fraud, pyramid
schemes, municipal securities, complex financial instruments, and investment-adviser fraud, he said. Mr.
Ceresney highlighted financial-reporting fraud as another area in which the SEC is ramping up efforts.
The numbers of these bread-and-butter, fiddling-the-books cases fell sharply in the aftermath of the
crisis. That trend is now reversing: The SEC will this fiscal year be able to report an increase for this
type of case for the first time since 2008, said a person close to the agency. Accounting and financialreporting fraud numbers are up at least 25% on the 68 total for the year
through September 2013, the person
said. But these cases are mostly on a fairly modest scale, in terms of the sanctions imposed. "We're not seeing many really big actions; there is
nothing to match the accounting fraud cases of the late 1990s," said Thomas Sporkin, a former SEC attorney who is now a partner at law firm
BuckleySandler LLP. Some lawyers question the seeming pressure on the SEC to bring ever-bigger cases. Bradley Bondi, a former counsel to two
former SEC Republican commissioners, said the agency has touted its enforcement statistics as a gauge of its effectiveness for the past decade.
But police chiefs often rate success in terms of falling crime rates, said Mr. Bondi, now a partner at law firm Cadwalader, Wickersham & Taft
LLP. The SEC's increasing numbers of cases and "ever-growing penalty amounts" could show a need to re-evaluate how well it is deterring
future misconduct, he said. Arthur Levitt, the SEC's chairman from 1993 to 2001, said Ms. White has "got off to a good start" on enforcement.
But it is probably too early to judge the effectiveness of her drive to make the SEC a tougher agency. "I don't think we'll really know for a few
years," he said.
SEC investigations will continue to be successful – multiple warrants
Nili 3/18, (Yaron, Co-Editor on the Harvard law school forum on Corporate Governance and Financial
Regulation – Went to The Hebrew University: M.B.A., Finance - LL.B., Law --- Activities and Societies:
Teaching assistant, "Mishpatim" Law review editor-in-chief, “SEC Enforcement Developments in 2014,
and a Look Forward", Harvard Law School, 3-18-2015, http://corpgov.law.harvard.edu/2015/03/18/secenforcement-developments-in-2014-and-a-look-forward/) BBer
As we noted last year in our memorandum focused on 2013 developments, Securities and Exchange Commission Chair Mary
Jo White has called for the SEC to be more aggressive in its enforcement program. By all accounts, the
Enforcement Division has responded to that call . The past year saw the SEC continue the trend, started
under Enforcement Director Robert Khuzami in 2009,
of transforming the SEC’s civil enforcement arm into an
aggressive law enforcement agency modeled on a federal prosecutor’s office. This should not come as a
surprise since both Andrew Ceresney, the current Director, and George Cannellos, Ceresney’s Co-Director for a brief period of time, like
Khuzami, spent many years as federal prosecutors in the Southern District of New York. And the Commission itself is now led for the first time
by a former federal prosecutor, Mary Jo White, the US Attorney for the Southern District of New York from 1993 to 2002. Given the events of
the past decade involving the Madoff fraud and the fallout from the 2008 financial crisis, we believe both
positions the SEC has taken in recent years will continue.
the aggressive tone and
In this post, we outline some of the developments in the SEC’s
enforcement program and the remedies it has pursued over the past year. We also discuss important developments in areas where we expect
to see continued enforcement attention during 2015, including insider trading law, the private equity industry, and accounting and financial
Enforcement Program Focus Adopting a “Broken Windows” Approach to Enforcement
One of the significant and over-arching approaches to the enforcement agenda under Chair White’s
leadership is the so-called “broken windows” style of enforcement. Emulating tactics introduced by
the New York City Police Department in the mid-1990s, the Commission has pledged to crack down on even minor
reporting matters.
securities law infractions in an effort to deter more significant violations.
Chair White has explained that
the
purpose of the “broken windows” approach is twofold: to ensure that the SEC is punishing “even the
smallest infractions” while still pursuing the larger violations, and to make “you feel like we are
everywhere.” Extending the policing analogy further, she has said that “[i]t is important because investors in our markets want to know
that there is a strong cop on the beat—not just someone sitting in the station house waiting for a call, but patrolling the streets and checking on
things.” To the extent the
approach is designed to make clear that the Commission will attempt to have a
presence in virtually every sector of the markets and that it will enforce all of the agency’s rules, the
program should be neither controversial nor unique. The concern in the corporate sector, however, has focused on the
extent to which the “broken windows” policy means that disproportionately harsh sanctions, adverse
publicity, and reputational harm will be the consequence of transgressions that may indeed be minor.
In announcing the program, Chair White suggested that a group of actions in 2013 relating to violations of Rule 105 of Regulation M (prohibiting
certain short sales of a security in advance of a public offering of the same security) were an early example of this approach. Since then,
however, the only matter explicitly described as a “broken windows” effort was a group of actions announced in September 2014 against 28
corporate insiders (officers, directors, and major shareholders) for failure to timely and properly file reports of securities ownership.
It is
noteworthy that these actions do not seem to have been the result of a significant time investment by
the Enforcement staff. Rather, as described by the Commission, the actions were an example of the
SEC’s recent investments in new technology—the deficient filers were identified using sophisticated
computer analysis. This may ultimately be a key feature of this initiative—that more powerful computer-based analysis will expose
technical violations of filing or other requirements that may previously have gone unnoticed, allowing the Commission to bring
such message cases without distracting significantly from other enforcement priorities. The debate over this
enforcement policy will continue. Each Chairman and each Enforcement Director over the past several decades has worried about both the
breadth and reach of the enforcement program, attempting to have a presence throughout the markets and attempting to identify all manner
of violative behavior, whether delinquent filings or even very technical violations. The Chair’s public articulation of a policy, analogized to the
“broken windows” approach, was perhaps the lightning rod here, and the SEC may now be trying to ratchet back that rhetoric. Enforcement
Director Ceresney has recently said that the
“broken windows” approach is not about turning every violation into
an enforcement action but, rather, is about targeting rules where “we have seen a pattern of a lack of
compliance” and bringing cases that “send a strong message” to the market. Increasing Use of the
Administrative Forum The SEC has said that it will increasingly use the authority it gained through the
Dodd-Frank Act to bring more actions administratively. Previously, the Commission was limited in the types of actions it could
bring and the relief it could obtain in administrative proceedings. Dodd-Frank significantly expanded the relief the SEC can obtain
administratively. The
SEC is now authorized to bring actions against non-regulated entities and individuals
and to impose significant penalties in administrative actions. The remedies available to the SEC in the different fora are
now effectively the same. In preparing to both bring and likely litigate more administrative actions, the SEC recently increased the
number of its Administrative Law Judges from three to five and increased the ALJs’ staff. The SEC has
also expanded the types of cases that it will consider bringing administratively . In June 2014, shortly after two
well-publicized trial losses, Director Ceresney noted that, although it had been rare in the past, the SEC would likely bring insider
trading cases as administrative proceedings going forward. The SEC has since filed several insider
trading cases administratively, and the Staff has said that it expects to bring more FCPA cases in the
administrative forum as well. After judicial challenges to a number of negotiated settlements and losses in court over the past
several years, many observers have suggested that the increased use of administrative proceedings is an
effort by the SEC to secure a “home-court advantage” and avoid the scrutiny of federal judges and
juries. In fiscal year 2014, the SEC won all six of its litigated administrative proceedings, but only 11 of its 18
federal court trials. While lauding the agency’s trial record on the one hand, Ceresney has not been shy about highlighting the
advantageous features of the administrative forum, including prompt decisions, specialized fact-finders, and less stringent rules of evidence.
Not surprisingly, the SEC’s decision to use its administrative forum in more cases has come under criticism. For example, Judge Rakoff of the
Southern District of New York has discussed the dangers of bringing more cases administratively, including concerns about the securities laws
being interpreted in a non-judicial forum and the fairness of the administrative proceedings due to the inapplicability of the federal rules of
evidence, the lack of a jury trial, and the deference the decisions are entitled to on appellate review. James Cox, a professor at Duke University
School of Law, has similarly commented that the SEC must be “sensitive to the benefits” of developing precedent in the federal courts. While
there is no basis to believe that the ALJs in these proceedings are not fair and, indeed, that this forum may be more advantageous to
respondents in some cases, the process concerns (absence of clear discovery rules, appeal to the Commission itself if one loses) and
appearance issues (an in-house forum) should concern the Commission and the Staff. A number of respondents in SEC administrative actions
have filed suit in recent months challenging the actions on constitutional and procedural grounds. Thus far, none of these challenges has been
successful, though several remain pending. In the first action to be decided, the District Court for the District of Columbia held that it lacked
subject matter jurisdiction over the action because no final decision had been rendered by the Commission. Even then, the court noted, the
Exchange Act provided for initial judicial review in the Court of Appeals, not the District Court. That case is now on appeal to the DC Circuit. In
December, Judge Lewis Kaplan of the SDNY similarly held that the district court lacked jurisdiction to consider an action seeking to enjoin the
SEC from proceeding with an administrative action against an investment adviser and his firm. Several other cases remain pending. Recently, a
former Standard & Poor’s executive filed a pre-emptive declaratory judgment action against the SEC after being notified that the Staff intended
to recommend that the Commission bring an administrative proceeding against her. She is asking the court to enjoin the SEC proceeding and to
find that, because the SEC’s Administrative Law Judges are officers of the executive branch who cannot be removed from office directly by the
President, the SEC’s adjudicatory system violates Article II of the Constitution. The SEC itself has been dismissive of complaints that its
administrative proceedings are unfair. In the face of criticism regarding the Commission’s increased use of administrative proceedings and the
argument that it is unfair or unconstitutional, Director Ceresney defended the practice, noting that the Commission is still bringing a
“significant” number of cases in district court and arguing that the SEC’s use of its administrative forum is “eminently proper, appropriate, and
fair to respondents.” In seeking to impose individual liability, the
Staff is also increasingly focused on those in so-called
“gatekeeper” roles, including compliance officers, accountants, and attorneys. This focus, which harkens back to
the Stanley Sporkin era in the 1970s, was, if anything, sharpened in 2014 with the Commission introducing an initiative it
refers to as “Operation Broken Gate.” This is an effort to look even more closely at the role of such
gatekeepers—those who are “obviously central to our system”—in enforcement actions. This focus
appears designed to achieve at least two goals: (1) sending a message to the public that the SEC is
getting tough on individuals in positions of authority within public companies who may have
benefited from improper conduct; and (2) incentivizing those in the private sector who can prevent
violations because they hold the keys to disclosure and investor protection by pushing them “to
actively look for red flags, ask the tough questions, and demand answers.” We expect this focus on
“gatekeepers” to continue into 2015 and beyond. Remedial Developments Eroding the “No Admit/No
Deny” Settlement Model
As we noted in last year’s memo, in 2013, the Commission announced a change to its long-standing policy
of concluding nearly all settled enforcement cases without an admission from the respondent. Previously, the SEC had required admissions only
in cases where the respondent had already pled guilty to criminal charges stemming from the same conduct. SEC
settlements
generally included language stating that the respondent neither admitted nor denied the factual
allegations set forth in the Commission’s complaint or order. The policy change comes after the SEC has been subject to
significant criticism from federal judges and others for submitting such “no admit/no deny” settlements to the courts for approval. Over the
past few years, several proposed SEC settlements have been delayed and scrutinized as a result of concerns raised by the presiding judge. Judge
Rakoff started the trend of federal judges refusing to “rubber-stamp” SEC settlements and has been the most vocal critic of the Commission’s
no admit/no deny settlement policy. He initially refused to approve the Commission’s proposed $285 million settlement with Citigroup over its
role in structuring and marketing a package of mortgage bonds to investors. Other courts have followed Judge Rakoff’s lead. For example, Judge
Kane of the District of Colorado issued an opinion rejecting a proposed settlement, stating that “‘[l]ike Judge Rakoff, I will not be a mere
handmaiden to a settlement negotiated on unknown facts, while the public is deprived of ever knowing the truth in a matter of obvious public
importance.’” Although Judge Rakoff’s refusal to approve the Citigroup settlement was overturned by the Second Circuit, the Commission has
nonetheless said it will continue to demand admissions in certain cases. The
new policy reflects the Commission’s view
that admissions increase accountability and boost investor confidence in the SEC and the markets. The
SEC has since sought and obtained admissions in a number of cases. Under the new policy, the SEC will potentially
seek admissions where: a large number of investors were harmed or the conduct was “egregious”; the conduct posed “significant risk” of harm
to the markets or investors; the admissions would “aid investors deciding whether to deal with a particular party in the future”; and reciting the
facts of the case would “send an important message” to the market. Significantly, according to Director Ceresney, admissions are not
negotiable. Once the SEC determines there should be an admission in a particular case, there is no room for negotiation. For example,
according to Ceresney, the SEC will not accept a larger penalty in lieu of an admission. The respondent must either admit or litigate.
Declining to Relieve Collateral Consequences of Settlements When public companies or regulated
entities settle enforcement actions with government regulators, including the SEC, there are often
automatic consequences that apply. These collateral consequences can be quite dramatic and have
significant negative impacts on the settling entity. In the SEC context, for example, a public company that settles to
violations of the anti-fraud provisions of the securities laws automatically loses its status as a Well-Known Seasoned Issuer, or WKSI. WKSI
status allows a company to issue new securities without going through the SEC’s typical review process, allowing for faster capital raising.
Similarly, Dodd-Frank required the
SEC to implement a so-called “bad actor” rule that disqualifies brokerdealers with “a relevant criminal conviction, regulatory or court order, or other disqualifying event”
from relying on a Rule 506 exemption to sell certain private investments, like interests in hedge funds and private-equity funds. Challenges to
the routine granting of waivers seems likely to continue into 2015. Recently, the Department of Labor, which oversees a similar disqualification
regime, took the unusual step of holding an open meeting on a waiver request from Credit Suisse in connection with a disqualification from
managing pension funds as a result of its resolution of a tax evasion case with federal prosecutors. Historically, the DOL staff had routinely
granted such waivers. In Credit Suisse’s case, however, consumer advocates and members of Congress objected to the waiver, prompting the
DOL to hold public hearings on the question in early January 2015. Consumer advocate Ralph Nader testified against granting the waiver. While
the DOL decision-making process seems to be more protracted than the SEC’s, allowing interested parties more opportunity to participate in
the process, it seems likely that activists will eventually turn their attention to the SEC waiver process, increasing the political pressure on the
Commissioners in considering such requests.
Tying Penalties to the Respondent’s Financial Position, Not the
Underlying Activity We expect that the SEC will continue to push for ever-larger penalties in 2015,
especially in cases, as with the examples cited above, where the respondent is not a public company and the impact of the penalties will not be
passed on to shareholders. Under
the discretion the securities laws give the Staff and the Commission to set
penalties, and citing “deterrence” as the key consideration, the Commission will continue to take into account the size
and financial wherewithal of an individual or an enterprise in setting the amount of any penalties sought or assessed. Substantive
Developments Insider Trading Law The year 2014 may have seen the rolling back of the tide of
successful insider trading cases brought both by the Manhattan US Attorney’s Office and the SEC. Last year saw the SEC
bring 52 insider trading actions, charging 80 people, an increase over the 44 cases brought in 2013 .
Already, the US Attorney’s Office has filed a brief in another insider trading case, United States v. Durant, arguing that the Second Circuit
decision should be construed narrowly. The government argued that, while “[t]he Newman decision dramatically (and, in our view, wrongly)
departs from thirty years of controlling Supreme Court authority,” the decision does not apply in Durant. Newman applies to insider trading
cases brought under the classical theory of liability the government argued, while Durant was brought under the misappropriation theory. On
January 23, the US Attorney’s Office asked the three-judge panel that decided the case to reconsider its ruling. If the court elects not to
reconsider its decision, the government may request that the entire Second Circuit hear the case en banc or petition the Supreme Court to hear
the appeal. That said, the decision is already having an effect. On January 29, Southern District prosecutors indicated that, as a result of
Newman, the Office would drop charges against five men who had been indicted on insider trading charges relating to IBM’s acquisition of a
software company in 2009.
Asset Management Industry The SEC has been focused on the private equity
sector for several years. In 2014, the Office of Compliance Inspections and Examinations began
completing a series of “presence exams” it had been conducting of a large number of industry
participants since 2012. The results of the exams were sufficiently troubling to the SEC that, in April 2014, the Commission
announced that it was launching a new unit within OCIE dedicated to the examination of private
equity and hedge funds. In addition to this new unit, two other groups within the SEC continue to focus on
private equity: the Asset Management Unit, established in 2010, and the Financial Reporting and Audit
Task Force. Andrew Bowden, the Director of OCIE, has said that over half of the private equity advisers that have been examined under the
presence exam initiative appear to be violating laws or have material weaknesses around how they assess fees and expenses to clients. The
SEC has filed several enforcement actions arising out of those exams. The actions brought include the
Commission’s first-ever action against a private equity firm for violating the pay-to-play rules. Those rules
prohibit investment advisers from providing advisory services to a government entity for two years following a campaign contribution to an
elected official of that entity.
The SEC also brought an action relating to the fees and expenses charged by a
private equity firm. The SEC alleged that the firm and its president violated the anti-fraud and other provisions of the securities laws by
misallocating assets from the funds to pay expenses of the management company, including rent, salaries, and other employee benefits. The
SEC also alleged that after depleting the funds’ assets, the management company made loans to the funds at “excessive” interest rates. Finally,
the SEC brought fraud charges against a private equity fund manager for breaching its fiduciary duty
by inappropriately allocating expenses between two of its funds. Given the breadth of the presence exams and the
establishment of a new unit focused specifically on this industry, we expect to see more actions against private equity firms in 2015.
Accounting and Financial Reporting Another area where we expect to see increased SEC enforcement
activity in 2015 is in accounting and financial reporting cases.
Although this has not been much of a focus area since
the financial crisis, that is beginning to change. After several years of seeing the number of such actions decline year over year, the
number
of financial reporting and disclosure cases brought by the SEC shot up 45% in fiscal 2014. The SEC has
said it expects to “continue the momentum in pursuing financial reporting and accounting fraud” in
2015. The Financial Reporting and Audit Task Force mentioned above was established by the
Commission to identify and develop potential cases that can then be referred to the Enforcement
Division for investigation. While the Task Force has begun issuing information requests to public companies, it remains to be seen
how active or effective it will be in generating enforcement recommendations. * * * This remains a challenging environment for individuals and
enterprises who find themselves involved in regulatory investigations.
The SEC has demonstrated its increasing willingness
to push traditional boundaries—including bringing more actions administratively, naming individuals,
and seeking admissions in settled matters—suggesting that is not likely to either change course or
become less demanding anytime soon.
Links
Subpoena Key
The SCA impedes federal investigations — they’d need prior approval.
Thompson and Cole 15 — Richard M. Thompson II and Jared P. Cole, Legislative Attorneys for the
Congressional Research Service, 2015 (“Stored Communications Act: Reform of the Electronic
Communications Privacy Act (ECPA),” Federation of American Scientists, May 19th, Available Online at
http://fas.org/sgp/crs/misc/R44036.pdf, Accessed on 07-06-15)
While the various ECPA reform bills discussed above appear to enjoy broad support among technology,
civil liberty, and government constituencies, some federal agencies have argued that passage of these
bills would significantly curtail their ability to conduct investigations. In an apparent effort to assuage
these concerns, the Email Privacy Act, the ECPA Amendments Act, and the LEADS Act include a “rule of
construction” noting that these agencies could still seek electronic communications directly from the
target of their investigation.
Currently, many federal agencies possess subpoena authority which allows them to compel the
production of documents from providers without prior approval of a court. Pursuant to Section
2703(b), federal agencies have issued subpoenas to service providers to obtain subscriber information
about individuals, including their names, telephone numbers, email addresses, and physical
addresses, and have indicated that they have used this authority to obtain the content of emails held
by service providers for more than 180 days.
The plan would prevent agencies from using subpoenas – requires DOJ intervention.
Thompson and Cole 15 — Richard M. Thompson II and Jared P. Cole, Legislative Attorneys for the
Congressional Research Service, 2015 (“Stored Communications Act: Reform of the Electronic
Communications Privacy Act (ECPA),” Federation of American Scientists, May 19th, Available Online at
http://fas.org/sgp/crs/misc/R44036.pdf, Accessed on 07-06-15)
All of the major ECPA reform bills would require a warrant to obtain the contents of electronic
communications held by service providers, whether held for more or less than 180 days. One result of
this provision would be that administrative subpoenas—subject to a lower standard of proof than
warrants—would no longer be sufficient to compel service providers to produce the contents of
electronic communications. However, because most federal agencies—other than the Department of
Justice (DOJ)—do not possess independent authority to seek a warrant from a magistrate judge, such
legislation would appear to preclude agencies conducting an investigation to obtain the contents of
electronic communications held by service providers directly from the provider itself. Instead, in order
to do so, agencies would presumably need to rely on the DOJ to seek a warrant, whose authority is
limited to doing so in criminal investigations.
Probable Cause Link
Requiring higher probable cause makes hampers investigations.
Baker 11 — James A. Baker, Associate Deputy Attorney General, Statement before the Committee on
Judiciary United States Senate, 2011 ("The Electronic Communications Privacy Act: Government
Perspectives on Protecting Privacy in the Digital Age," American Civil Liberties Union, April 6th, Available
Online at https://www.aclu.org/files/pdfs/email-content-foia/DOJ%20Crim%20Div%20docs/CRM231.pdf, Accessed on 07-07-15)
A third potentially appropriate topic for legislation is to clarify the standard for issuance of a court order under § 2703(d) of ECPA. ECPA
provides that the government can use a court order under § 2703(d) to compel the production of noncontent data, such as email addresses, IP addresses, or historical location information stored by
providers. These orders can also compel production of some stored content of communications, although
compelling content generally requires notice to the subscriber. According to the statute, "[a] court order for disclosure...
may be issued by any court that is a court of competent jurisdiction and shall issue only if the governmental entity
offers specific and articulable facts showing that there are reasonable grounds to believe that the contents of a
wire or electronic communication, or the records or other information sought, are relevant and
material to an ongoing criminal investigation." 18 U.S.C. § 2703(d). Until recently, no court had questioned that the United
States was entitled to a 2703(d) order when it made the "specific and articulable facts" showing specified by § 2703(d). However, the
Third Circuit recently held that because the statute says that a 2703(d) order "may" be issued if the
government makes the necessary showing, judges may choose not to sign an application even if it
provides the statutory showing. See In re Application of the United States, 620 F.3d 304 (3d Cir. 2010). The Third Circuit's
approach thus makes the issuance of § 2703(d) orders unpredictable and potentially inconsistent; some
judges may impose additional requirements, while others may not . For example, some judges will issue these orders
based on the statutory "reasonable grounds" standard, while others will devise higher burdens. In considering the standard for issuing 2703(d)
orders, it
is important to consider the role they play in early stages of criminal and national security
investigations. In the Wikileaks investigation, for example, this point was recently emphasized by
Magistrate Judge Buchanan in the Eastern District of Virginia. In denying a motion to vacate a 2703(d)
order directed to Twitter, Judge Buchanan explained that "at an early stage, the requirement of a
higher probable cause standard for non-content information voluntarily released to a third party
would needlessly hamper an investigation."
Kills SEC
The SEC is specifically effected — no guarantee targets will provide their e-mails.
Thompson and Cole 15 — Richard M. Thompson II and Jared P. Cole, Legislative Attorneys for the
Congressional Research Service, 2015 (“Stored Communications Act: Reform of the Electronic
Communications Privacy Act (ECPA),” Federation of American Scientists, May 19th, Available Online at
http://fas.org/sgp/crs/misc/R44036.pdf, Accessed on 07-06-15)
Nevertheless, at least one federal agency has claimed that the new warrant requirement contained in
the reform bills would unduly restrict its investigative authority. The Securities and Exchange
Commission (SEC), in a letter to the Senate Judiciary Committee, noted that the targets of agency
investigations do not always “retain copies of their incriminating communications or may choose not
to provide the e-mails in response to Commission subpoenas.”96 Accordingly, the letter argued, the
SEC has historically relied on authority under Section 2703(b) to obtain the contents of electronic
communications from service providers during its investigations. The legislation would foreclose the
SEC from doing so in the future, thereby weakening its investigative authority. The letter argued that if
the individuals under investigation knew that the SEC cannot go directly to the service providers to
obtain the contents of emails, then those individuals would be less likely to be forthcoming in
response to subpoenas issued directly to them. The letter concluded by suggesting that the legislation
be amended by inserting a provision that would allow a federal civil agency to seek the contents of
electronic communications from service providers subject to a standard similar to that governing the
issuance of criminal search warrants.
General Impact to Be Investigated Latter
The ability to access easily access communications data is crucial to law enforcement.
Baker 11 — James A. Baker, Associate Deputy Attorney General, Statement before the Committee on
Judiciary United States Senate, 2011 ("The Electronic Communications Privacy Act: Government
Perspectives on Protecting Privacy in the Digital Age," American Civil Liberties Union, April 6th, Available
Online at https://www.aclu.org/files/pdfs/email-content-foia/DOJ%20Crim%20Div%20docs/CRM231.pdf, Accessed on 07-07-15)
Mr. Chairman, the Department of Justice is charged with the responsibility of enforcing the laws,
safeguarding the constitutional rights of Americans, and protecting the national security of the United
States. As such, we welcome these hearings on this important topic. We appreciate the concerns that
some in Congress, the courts, and the public have expressed about ECPA. We know that some believe
that ECPA has not kept pace with technological changes or the way that people today communicate and
store records, notwithstanding the fact that ECPA has been amended several times for just that purpose.
We respect those concerns, and we appreciate the opportunity to discuss them here today. We also
applaud your efforts to undertake a renewed examination of whether the current statutory scheme
appropriately accommodates such concerns and adequately protects privacy while at the same time
fostering innovation and economic development. It is legitimate to have a discussion about our present
conceptions of privacy, about judicially-supervised tools the government needs to conduct vital law
enforcement and national security investigations, and how our statutes should accommodate both.
For example, we appreciate that there are concerns regarding ECPA's treatment of stored
communications - in particular, the rule that the government may use lawful process short of a warrant
to obtain the content of emails that are stored for more than 180 days. We are ready and willing to
engage in a robust discussion of these matters to ensure that the law continues to provide appropriate
protections for the privacy and civil liberties of Americans as technology develops. As we engage in that
discussion, what we must not do - either intentionally or unintentionally - is unnecessarily hinder the
government's ability to effectively and efficiently enforce the criminal law and protect national
security. The government's ability to access, review, analyze, and act promptly upon the
communications of criminals that we acquire lawfully, as well as data pertaining to such
communications, is vital to our mission to protect the public from terrorists, spies, organized
criminals, kidnappers, and other malicious actors. We are prepared to consider reasonable proposals
to update the statute - and indeed, as set forth below, we have a few of our own to suggest — provided
that they do not compromise our ability to protect the public from the real threats we face.
Significantly, ECPA protects privacy in another way as well: by authorizing law enforcement officers to
obtain evidence from communications providers, ECPA enables the government to investigate and
prosecute hackers, identity thieves, and other online criminals. Pursuant to ECPA, the government
obtains evidence critical to prosecuting these privacy-related crimes.
National security investigations are effected by ECPA standards.
Baker 11 — James A. Baker, Associate Deputy Attorney General, Statement before the Committee on
Judiciary United States Senate, 2011 ("The Electronic Communications Privacy Act: Government
Perspectives on Protecting Privacy in the Digital Age," American Civil Liberties Union, April 6th, Available
Online at https://www.aclu.org/files/pdfs/email-content-foia/DOJ%20Crim%20Div%20docs/CRM231.pdf, Accessed on 07-07-15)
ECPA has never been more important than it is now. Because many criminals, terrorists and spies use
telephones or the Internet, electronic evidence obtained pursuant to ECPA is now critical in
prosecuting cases involving terrorism, espionage, violent crime, drug trafficking, kidnappings,
computer hacking, sexual exploitation of children, organized crime, gangs, and white collar offenses.
In addition, because of the inherent overlap between criminal and national security investigations,
ECPA's standards affect critical national security investigations and cyber security programs.
Internal Link
Ext. Stock Market Key
Wall Street key to the Global Economy
Picardo ’13 Elvis Picardo, CFA and Portfolio manager at Global Securities Corporation,
2013 (“Why Wall Street Is A Key Player In The World's Economy”, Investopedia, No
Month Provided, Available Online at
http://www.investopedia.com/articles/investing/100814/wall-streets-enduring-impacteconomy.asp, Accessed 07/10/15)
The most important financial center in the world? A fabled place of silver spoons and golden parachutes? A hub of cut-throat capitalism? Or all
of the above. Wall Street is many things to many people, and the perception of what it really is depends on who you ask.
Although
people’s views of Wall Street may differ widely, what is beyond dispute is its enduring impact not just
on the American economy, but on the global one. What is Wall Street anyway? Wall Street physically takes up only a few
blocks that amount to less than a mile in the borough of Manhattan in New York City; however, its clout extends worldwide. The
term “Wall Street” was initially used to refer to the select group of large independent brokerage firms that dominated the U.S. investment
industry. But with the lines between investment banks and commercial banks having been blurred since 2008, Wall
Street in current
financial parlance is the collective term for the numerous parties involved in the U.S. investment and
financial industry. This includes the biggest investment banks, commercial banks, hedge funds, mutual funds, asset management firms,
insurance companies, broker-dealers, currency and commodity traders, financial institutions and so on. Although many of these entities may
have their headquarters in other cities such as Chicago, Boston, and San Francisco, the media still refers to the U.S. investment and financial
industry as Wall Street or simply “The Street.” Interestingly, the popularity of the term “Wall Street” as a proxy for the U.S. investment industry
has led to similar “Streets” in certain cities where the investment industry is clustered being used to refer to that nation’s financial sector, such
as Bay Street in Canada and Dalal Street in India. Why Wall Street has such an impact The U.S. is the world’s biggest economy, with 2013 gross
domestic product (GDP) of $16.80 trillion, comprising 22.4% of global economic output. It is almost twice the size of the second-biggest
economy, China (2013 GDP = $9.24 trillion).
In terms of market capitalization, the U.S. is the world’s biggest by
some distance, with a market value of $23.6 trillion dollars (as of September 23, 2014) that comprises
36.3% of global market capitalization. Japan’s $4.6-trillion market is a distant second, with just over 7% of global market cap.
Wall Street has such a significant impact on the economy because it is the trading hub of the biggest
financial markets in the world’s richest nation. Wall Street is home to the venerable New York Stock
Exchange (now called NYSE Euronext), which is the undisputed leader worldwide in terms of average daily share trading volume and total
market capitalization of its listed companies. Nasdaq OMX, the second-largest exchange globally, also has its headquarters on
Wall Street. Street firms together control trillions of dollars in financial assets, while New York is the second-largest trading center in the
foreign exchange market, where daily trading volumes exceed $5 trillion. How does Wall Street have an impact? Wall Street affects the U.S.
economy in a number of ways, the most important of which are – Wealth Effect: Buoyant
stock markets induce a “wealth
effect” in consumers, although some prominent economists assert that this is more pronounced during a real estate boom than it is
during an equity bull market. But it does seem logical that consumers may be more inclined to splurge on big-ticket
items when stock markets are hot and their portfolios have racked up sizeable gains. Consumer Confidence:
Bull markets generally exist when economic conditions are conducive to growth and consumers and businesses are confident about the outlook
for the future. When
their confidence is riding high, consumers tend to spend more, which boosts the U.S.
economy since consumer spending accounts for an estimated 70% of it. Business investment: During bull markets,
companies can use their pricey stock to raise capital, which can then be deployed to acquire assets or
competitors. Increased business investment leads to higher economic output and generates more
employment. Global bellwether The stock market and the economy have a symbiotic relationship, and during good times, one drives the
other in a positive feedback loop. But during uncertain times, the interdependence of the stock market and the
broad economy can have a severely negative effect. A substantial downturn in the stock market is
regarded as a harbinger of a recession, but this is by no means an infallible indicator. For example, the Wall Street crash of 1929
led to the Great Depression of the 1930s, but the crash of 1987 did not trigger a recession. This inconsistency led Nobel laureate Paul
Samuelson to famously remark that the stock market had predicted nine of the last four recessions.
Wall Street drives the U.S.
equity market, which in turn is a bellwether for the global economy. The 2000-02 and 2008-09 global recessions
both had their genesis in the U.S., with the bursting of the technology bubble and housing collapse respectively. But Wall Street can also be the
catalyst for a global expansion, as is evident from two examples in the current millennium. The 2003-07 global economic expansion commenced
with a huge rally on Wall Street in March 2003. Six years later, amid the biggest recession since the 1930s depression, the climb back from the
economic abyss started with a massive Wall Street rally in March 2009. Why Wall Street reacts to economic indicators Prices of stocks and
other financial assets are based on current information, which is used to make certain assumptions about the future that in turn form the basis
for estimating an asset’s fair value. When
an economic indicator is released, it would usually have little impact
on Wall Street if it comes in as per expectations (or what’s called the “consensus forecast” or “analysts’ average estimate”).
But if it comes in much better than expected, it could have a positive impact on Wall Street; conversely, if it is worse than expectations, it would
have a negative impact on Wall Street. This positive or negative impact can be measured by changes in equity indices like the Dow Jones
Industrial Average or S&P 500, for instance. For example, let’s say that the U.S. economy is coasting along and payroll numbers to be released
on the first Friday of next month are expected to show that the economy created 250,000 jobs. But when the payrolls report is released, it
shows that the economy only created 100,000 jobs. Although one data point does not make a trend, the weak payroll numbers may lead some
economists and market-watchers on Wall Street to rethink their assumptions about U.S. economic growth going forward. Some Street firms
may lower their forecasts for U.S. growth, and strategists at these firms may also reduce their targets for the S&P 500. Large institutional
investors who are clients of these Street firms may choose to exit some long positions upon receiving their lowered forecasts. This cascade of
selling on Wall Street may result in equity indices closing significantly lower on the day. Why Wall Street reacts to company results Most
medium to large-sized companies are covered by several research analysts who are employed by Wall Street firms. These analysts have indepth knowledge of the companies they cover, and are sought after by institutional “buy side” investors (pension funds, mutual funds etc.) for
their analysis and insights. Part of analysts’ research efforts are devoted to developing financial models of the companies they cover, and using
these models to generate quarterly (and annual) revenue and earnings per share forecasts for each company. The average of analysts’ quarterly
revenue and EPS forecasts for a specific company is called the “Street estimate” or “Street expectations.” Thus, when a company reports its
quarterly results, if its reported revenue and EPS numbers match the Street estimate, the company is said to have met Street estimates or
expectations. But if
the company exceeds or misses Street expectations, the reaction in its stock price can
be substantial. A company that exceeds Street expectations will generally see its stock price rise, and one that disappoints may see its
stock price plunge.
Insider Trading Enforcement Solves
SEC’s management of Insider trading is effective and evolving
Hohenstein, ’06 -- Kurt Hohenstein, Ph D in History from the University of Virginia, 2006 (“Old Debate
and New Rules: SEC Regulation of Insider Trading in the Global Marketplace”, SEC Historical, November
1, Available online at http://www.sechistorical.org/museum/galleries/it/index.php, Accessed 07/08/15)
Part of the reason for the SEC's success in enforcing its rules against insider trading is how the SEC,
which in its early years battled with the stock exchanges, developed a cooperative relationship with the stock
exchanges, particularly on disclosure and investor confidence issues. Officials of the New York Stock Exchange tightened their
own rules in response to the major insider trading scandals , designed to monitor and flag suspicious trading. While there
is still disagreement on how far the stock exchanges must go to regulate their own traders, SEC officials and NYSE officers have
worked together to create a more transparent system to identify and disclose transactions that
appear to violate the law. Both organizations have agreed that wide-spread investor confidence is a
priority.(55) The SEC's ability to adapt played a prominent role in the agency's success in regulating
insider trading. In 2000, the SEC adopted Rules 10b5-1 and 10b5-2 to deal with new devices for automatic and computer- programmed
securities purchases and sales. In addition, Rule 10b5-2 was intended to provide a guide to investors as to what constituted the kinds of duties
which would make the misappropriation theory applicable. Regulation FD was yet another response by the SEC to concerns by investment
managers, who often shared confidential information with clients, as to how they might avoid insider trading liability yet continue to perform
their duties. The Sarbanes-Oxley Act of 2002 extended the SEC concerns about insider trading by requiring "real time disclosure", increasing
penalties and lengthening the statute of limitations for fraud, requiring prompter reporting for trades by insiders, and prohibiting trading by
insiders during a pension fund blackout.(56) The
SEC continues to respond to new situations with rules meant to
provide additional instruction to investors and securities professionals as to how the SEC would apply
the misappropriation theory to new and changing securities practices. Even as the 21st century
revealed new insider trading scandals involving Enron, Martha Stewart and Imclone, the SEC has
continued its steady push for more disclosure, more fiscal transparency, and more regularity in
financial reporting and accounting in order to ensure that every investor has access to equal
information about regulated companies.(57) But the path of insider trading enforcement becomes increasingly complicated as
SEC regulations are applied to the global market. The story of insider trading regulation to the present has involved
the SEC's use of administrative and common law and institutional competence to react to challenges,
and to reshape legal theories in order to promote fair markets and investor confidence. Whether those
methods can successfully work to regulate insider trading in the global marketplace will prove to be the challenge for SEC officials as the future
history of insider trading unfolds.
SEC regulation deters Insider Trading; multiple warrants
Del Guercio, Odders-White, and Ready ’13 Diane Del Guercio, Professor at University of Oregon, Elizabeth R.
Odders-White, Professor at Wisconsion School of Business, and Mark J. Ready, Professor at Wisconsin School of Business, 2013 (“The
Deterrence Effect of SEC Enforcement Intensity on Illegal Insider Trading”, September 2013, Availabe Online at
http://poseidon01.ssrn.com/delivery.php?ID=218125068102112120114082024088108010103082061020005063086101094127013119113102
1190781231181001200501041121130750841260170021040200590050390770901250971021220800230370120930701151120900080010680
23085114068127031075113003122068092021073100110003&EXT=pdf&TYPE=2, Accessed 07/08/15)
The effects of enforcing insider trading laws have been debated in the law, economics, and finance literature for decades. Early arguments
proposed by Manne (1966) and Carlton and Fischel (1983) predict that price efficiency improves when trading by insiders with superior
information quickly and accurately impounds information into stock prices. An opposing view is that price efficiency is harmed when investors
believe that privileged insiders have an unfair informational advantage because it reduces the incentive of outside investors to gather
information or even participate in the stock market (Fishman and Hagerty (1992) and Khanna, Slezak, and Bradley (1994)). Under this view,
unchecked insider trading crowds out trading by other potential participants, such as institutional
investors, who would otherwise compete for profits under a more level playing field. Although we do not
attempt to settle this debate, we recognize that both arguments assume that enforcement deters insider trading, a largely
untested premise, at least in the United States. We fill this gap by providing direct evidence of the link between
resource-based measures of the U.S. Securities and Exchange Commission’s (SEC’s) enforcement
intensity and the level of insider trading. Despite the fact that the U.S. has a longer history of insider trading
enforcement and devotes more resources toward it than any other country, we have limited empirical evidence
of whether these efforts deter insider trading or affect price efficiency.1 Previous studies have measured the effect of U.S. enforcement by
comparing days on which prosecuted insider trades took place with days when they did not. Most studies in this strand of the literature analyze
detailed transaction-level data from a single court case (Cornell and Sirri (1992), Chakravarty and McConnell (1999), and Fishe and Robe
(2004)), and not surprisingly find mixed evidence. Only Meulbroek (1992) examines a comprehensive sample of Insider trading laws were first
enforced in the U.S. in 1961. In 2012, the SEC dedicated $467 million and 1300 staff to the Enforcement Division. This does not count resources
devoted to other divisions within the SEC or to enforcement by the U. S. Attorney’s Offices of the Department of Justice. See Bhattacharya and
Daouk (2002), Beny (2007), and Coffee (2007) for cross-country comparisons. all prosecuted insider trading cases, although her sample ends
over two decades ago in 1989. In addition, studies
of prosecuted trades suffer from the well-known concern that
the results may not generalize if successfully prosecuted trades systematically differ from the
population of all illegally informed trades. Most empirical evidence on the effects of enforcement comes from cross-country
analysis either comparing countries with different enforcement regimes (Bhattacharya et al. (2000) and Griffin et al. (2011)), or testing for the
impact of the first-time enactment or enforcement of insider trading laws (Bhattacharya and Daouk (2002), Bushman et al. (2005), DeFond et
al. (2007), Fernandes and Ferreira (2009)). The consensus in this literature is that the enforcement
of insider trading laws
matters, rather than just the law on the books, and that more aggressive enforcement is associated
with improvements in liquidity and stock price informativeness, and lower costs of capital, generally
supporting the crowding out view. In this paper, we argue that dramatic changes in insider trading enforcement since the 1980s
enable us to empirically identify the effects of more aggressive enforcement on trader behavior and stock price discovery. First, the types
of trades that expose individuals to legal liability has broadened in scope since the 1980s, extending
far beyond the original principles of those with a fiduciary duty to the stock traded (Nagy, 2009; Bainbridge,
2012). Second, punishments for successfully prosecuted traders have become more severe, while at the
same time the amount of resources devoted to enforcement has increased dramatically. For example, the
SEC’s budget in real terms is over four-times larger today than it was in the 1980s. Finally, high-profile insider trading cases
(e.g., Galleon) and recent developments in SEC enforcement have both received extensive press
coverage, suggesting that regulators have been actively signaling their increased enforcement
aggressiveness. We posit that traders are aware of these developments and test whether more aggressive
SEC enforcement effort deters illegal insider trading and affects price discovery. To measure variation in the
intensity of SEC enforcement over time, we follow recent studies that use resource-based measures to test for the effects of enforcement on
capital market outcomes. For example, Christensen, Hail, and Leuz (2011) show that stock market liquidity increases by 15% after European
reforms to enforce insider trading and market manipulation laws, but only in the countries with the highest regulatory staff and the highest
growth in staff from before to after the reforms. In the spirit of Jackson and Roe (2009), we argue that both the level of the SEC’s budget in
constant 2011 dollars and the number of staff positions available in SEC annual reports are useful proxies for investors’ perceived enforcement
intensity of insider trading laws. We show that SEC resources vary substantially over time, and more importantly, that annual increases and
decreases are often driven by the idiosyncrasies of the federal budgeting process and are arguably exogenous to the level of illegal insider
trading. We also show that the years following the high-profile Galleon insider trading case in October 2009 represent a structural break in SEC
enforcement, and an opportunity for further identification of the effect of enforcement. This date marks the beginning of a transformative
restructuring of the SEC’s Enforcement Division, including the introduction of more effective detection technologies, new legal tools (e.g.,
cooperation agreements), and a commitment to target more sophisticated serial Wall Street offenders. Most legal experts agree that the
SEC’s aggressiveness in detecting and prosecuting insider trading in the post-Galleon era is
unprecedented. For example, former SEC Commissioner and current Stanford Law Professor Joseph Grundfest stated in the Wall Street
Journal that the SEC has “declared war on insider trading” and is taking “a zero-tolerance approach.”2 We use data on a comprehensive sample
of SEC prosecuted cases from fiscal years 2003 through 2007 and 2010 through 2011 to document that the typical prosecuted trader is more
likely to be a sophisticated Wall Street professional in the post-Galleon era, consistent with a structural break. Recent data on SEC prosecuted
cases also allow for a comparison to Meulbroek’s (1992) results from the 1980s, a period with both fewer enforcement budget and staff
resources and less effective tools for detecting and prosecuting insider trading. Under
more aggressive enforcement, traders
with access to inside information before its public announcement should fear detection and
punishment, and thus less illegal trading will occur. As long recognized in the literature, deterrence should also manifest in
the pattern of price discovery around news events. With less illegally-informed trading, the stock price reaction to news should
be more concentrated at the public announcement, with less anticipatory run-up of prices in the pre-
announcement period.3 Market makers and other liquidity providers would also view trading by insiders as a less serious threat under
aggressive enforcement, suggesting that insiders’ trades would result in smaller price changes. We find that the price impact on days
with prosecuted insider trades is in fact much smaller in the last decade than in the 1980s, consistent
with a deterrent effect. Meulbroek reports an average abnormal return of 3.1% on insider trading
days, whereas the average from our more recent sample is 0.5%. Moreover, inflation-adjusted insider
dollar volume is surprisingly similar in the two sample periods despite a roughly eight-fold increase in
total trading volume, suggesting that insiders did not scale up their volume in the later period,
perhaps reflective of an increased fear of prosecution. The pronounced decrease in relative insider trading volume is only
partially responsible for the smaller price impacts. In a subsample representing the top quintile of insider volume, the abnormal insider
trading day return is still only about 1.5%, significantly different from 3.1% at the 1% level, consistent with
more muted reactions to informed trading by liquidity providers. To tie these findings more directly to enforcement intensity, we show that
variation in insider volume is significantly related to variation in SEC enforcement intensity. Specifically, we show that while illegal
insiders trade more in higher-volume stocks, this sensitivity to stock volume is smaller when SEC
budgets and staffing are higher and during the post-Galleon period. This is consistent with the predictions of a
modified Kyle model in which insiders facing greater fear of prosecution scale up their trading less aggressively in response to increases in
uninformed volume.
In light of the potential lack of generalizability of results obtained from any sample of
only prosecuted cases, we also test whether pre-announcement run-up is negatively related to our
proxies for SEC enforcement intensity using two additional samples that are free of selection bias.
Specifically, we analyze patterns of price discovery for all annual earnings announcements and all
takeover bid announcements for publicly-traded target firms from the early 1980s through 2011.
Earnings and takeover news are especially relevant because they represent the most common type of information on which prosecuted insiders
trade. For general samples of both types of informational events, we find significant negative relations between the pre-announcement price
run-ups and both resource-based measures of SEC enforcement intensity after controlling for a time trend and other factors related to the
increased SEC effort reduces insider trading in advance of
these events. Even after controlling for these continuous measures, we find that pre-announcement price runups are
significantly lower for earnings announcements during the 2010 and 2011 fiscal years, indicating that
the change in SEC tools and increased severity of punishment had an additional dampening effect on
insider trading, beyond what would have been expected given the level of SEC budget or staff. Our
information content of the announcement. This suggests that
resource-based, U.S. enforcement intensity measures allow us to exploit thirty years of time-series variation to explain patterns of price
discovery and pre-announcement price run-up, and improve our understanding of the deterrence effects of public enforcement.
Insider Trading Hurts Econ
Insider trading erodes the economy
Stefano 11 — Theodore F. di Stefano is a founder and managing partner at Capital Source Partners,
which provides a wide range of investment banking services to the small and medium-sized business
and is also a frequent speaker to business groups on financial and corporate governance matters,
2011 (“Who's Hurt by Insider Trading”, 11/4/11, available at
http://www.ecommercetimes.com/story/73674.html date accessed 7/10/15 // K.K)
What's Wrong With Insider Trading? I have no doubt that there are still people who wonder what the
big deal is about insider trading. It seems to be a victimless crime, right? The fact is that such trading
erodes our very economic foundation. Why is that? Because such trading creates a trading field that is
not level -- meaning only certain "special" people on this trading field possess valuable information
about specific securities. Such information has the effect of oversized gains for a certain few and
losses to the masses. This is patently unfair on its face. Our economic system and stock exchanges need
to be efficient and honest. This means that everyone involved in trading securities has access to the
same information as everyone else. It doesn't necessarily mean that someone involved in the stock
market will take advantage of the available information. It does mean, however, that no information
is hidden from any participants in our markets. Rajaratnam has paid dearly for his moral lapses.
Besides being sentenced to 11 years in prison, he must pay a US$10 million fine and forfeit $53.8
million of his illegal profits from insider trading. The interesting (and wonderful) thing about this
sentence is that the profits Rajaratnam made from information that wasn't available to the entire
market must be returned. This sentence specifically quantifies the illegal gains derived by a person
who had information that the general market did not. It clearly shows that nature abhors a vacuum -the vacuum created by all of the information possessed by Rajaratnam and not possessed by the rest
of the market.
Insider Trading causes economic decline and prevents growth
Beny 2 — Laura Nyantung Beny is a John M. Olin Fellow in Law and Economics, Harvard Law School,
2000-2001; Assistant Professor of Law, University of Michigan Law School, beginning 2003, 2002, (“The
Political Economy of Insider Trading Legislation and Enforcement: International Evidence”, Harvard Law
Review, 01/2, available at http://www.law.harvard.edu/programs/olin_center/papers/pdf/348.pdf date
accessed 7/10/15 // K.K)
1. Price Informativeness and Capital Allocation Arbitrage (informed) traders play a positive role in
price formation, both in the extent and kind of information that is impounded in stock prices (Morck,
Yeung and Yu, 2000; Goshen and Parchomovsky, 2000). Risk arbitrageurs invest resources in
discovering firm-specific information. Their reward is the profit that they earn by trading with their
superior information against less informed investors. Risk arbitrageurs gather proprietary information
about firms until the marginal cost of doing so is greater than the marginal benefit. The collective
trading of many risk arbitrageurs leads to more efficient capitalization of information into stock prices
(Grossman, 1976; Shleifer and Vishny, 1997). In particular, more firm-specific arbitrage by informed
traders leads to more firmspecific price variation, making stock prices more informative (French and
Roll, 1986; Roll, 1988). Wurgler (2000) shows that capital is more efficiently allocated in the economy
the greater the amount of firm-specific information that is capitalized into stock prices. Therefore, if
insider trading discourages informed/arbritrage traders, it imposes a negative externality on the
economy by reducing the informativeness of stock prices. 2. Capital Constraints and the Cost of
Capital Capital constraints limit the range of feasible investments in the economy, in turn limiting
economic growth (Bekaert, Harvey, and Lundblad, 2001). A lower cost of capital makes investments
more profitable and encourages the entry of new entrepreneurs into the capital market. Using
international time series data, Bhattacharya and Daouk (2001) demonstrate that enforcing insider
trading legislation is followed by a 5% decrease in the cost of capital (measured by stock returns
relative to an international benchmark).18 Their finding suggests that the market’s perception of
unregulated insider trading makes capital more expensive, while serious enforcement of insider
trading laws significantly relaxes capital constraints. Hence enforcing an insider trading ban could lead
ultimately to increased economic growth. 3. Transaction Costs and Liquidity Liquid markets are
socially valuable because greater liquidity makes purchasing and disposing of shares on short notice,
at the appropriate price, easier for investors. The more liquid the market, the more willing investors are
to participate in it. This is true for both primary and secondary markets. Amihud and Mendelson (1986)
confirm that investors value liquidity by showing that companies whose shares are more liquid must
pay investors a lower expected rate of return than companies with less liquid shares. That is,
companies whose shares are more liquid have a lower cost of equity capital. Liquid markets might also
mitigate agency costs, by lowering the opportunity cost of monitoring and facilitating the market for
corporate control (Maug, 2000; Berndt, 2000).19 As noted above, however, insider trading increases
transaction costs and thus reduces stock market liquidity.
Insider trading kills the economy.
Breslow and Yglesias 14 – Jason M. Breslow, degree in communication from American
University, Political and Economic reporter. Matthew Yglesias, business and economics
correspondent for Slate and the author of The Rent Is Too Damn High, (“Should Insider
Trading Be Legal?” Jan 7 2014, PBS, Available online at
http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/to-catcha-trader/should-insider-trading-be-legal/) N.H
On the other hand, I don’t think the argument that allowing insider trading would improve market
efficiency by putting more information to work makes much sense. As Jie Hue and Thomas Noe write
in their analysis of the issue for the Atlanta Federal Reserve, the existence of a sophisticated securities
analysis industry in the United States means we don’t really face the problem of a major
informational gap. Just look at this year’s Nobel Prize winners in economics. Eugene Fama has shown
that U.S. equities markets are essentially “efficient” in an informational sense as is. His co-winner,
Robert Shiller, has done an enormous amount to demonstrate that this kind of efficiency hardly
precludes periodic manias and panics and that asset prices fluctuate much more dramatically than the
fundamentals. But the substantial holes poked in the theory of the stock market as efficient point to
herd psychology as the key flaw, not hidden information that insider trading would reveal.
The real impact of legalizing insider trading, in this instance, would be twofold. On the one hand, firms
that don’t want their insiders to trade on inside information would need to invest in their own
monitoring and enforcement mechanisms of firm-level rules. On the other hand, firms that didn’t
bother to invest in halting insider trading could construe permissive insider trading rules as a form of
additional compensation to employees.
The first impact hardly seems desirable. Since firms couldn’t level the same kind of sanctions as the
government, the monitoring would need to be much more intensive and expensive to produce
equivalent deterrence, leading to a huge waste of social resources. And the second impact seems
potentially disastrous. The last thing the American economy needs is a dynamic in which managers of
major corporations have even more financial incentive to spend their time thinking about ways to
game the stock market rather than manage their enterprises for the long term.
There are some good questions to be asked about the overall role of surveillance in American law
enforcement that would, of course, have important implications for insider trading cases as well as
other kinds of criminal activity. But the fundamental social goal of securities law is to have wellmanaged, well-capitalized enterprises and the ban on insider trading serves those goals perfectly well
as it stands.
Trillions of dollars are at stake enforcing insider trading rules are key.
Breslow and Yglesias 14 – Jason M. Breslow, degree in communication from American
University, Political and Economic reporter. Matthew Yglesias, business and economics
correspondent for Slate and the author of The Rent Is Too Damn High, (“Should Insider
Trading Be Legal?” Jan 7 2014, PBS, Available online at
http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/to-catcha-trader/should-insider-trading-be-legal/) N.H
This is perhaps a good way of thinking about the fundamental issue that divides us. When I look at the
contemporary United States, I’m much more inclined to worry that we are seeing systematically too
little capital investment than to worry that owners of corporate stock have too little cash in their
pockets. Business investment could create jobs and raise productivity, while stock ownership is
overwhelmingly concentrated in the hands of the most prosperous Americans.
Weakening insider trading protections will shift us into a lower-trust equilibrium in corporate
governance where we see less investment and more cash flushing out to people who don’t really need
it. A bad recipe.
Your suggestion that vigorous enforcement of insider trading laws is crowding out more worthy
investigations is an intriguing one. Certainly even in my role as designated basher of insider trading, I
wouldn’t try to make the case that this should be our absolute top priority. That said, there are an awful
lot of questions one can raise about priority-setting in the federal law enforcement context. We have
federal resources dedicated to hassling medical marijuana dispensaries in California, to policing the size
of shampoo bottles that people bring onto airplanes, and into deporting otherwise law-abiding people
for the “crime” of moving here from Mexico to roll burritos at Chipotle. Obviously, to debate marijuana
legalization or airport security or immigration reform would take us far outside the scope of this
exercise.
But my point is that to the extent that we’re really worried about resource constraints here, insider
trading enforcement is hardly the only place to look. More broadly, when you look at the scale of the
economic losses associated with the financial crisis and the ensuing recession — literally trillions of
dollars in unrecoverable lost output — it’s obvious that any genuinely useful regulatory efforts would
more than “pay for themselves.” Where I think we can agree is that as a purely political matter the
Obama administration has developed a bad habit of acting as if vigorous insider trading enforcement is a
way of striking at the heart of the issues that led to the crisis. That’s at best political theater aimed at
garnering a little undeserved populist credibility. It’s bad, and the press shouldn’t let them get away with
it. But it’s not a reason to legalize insider trading any more than the existence of unsolved murders
would be a reason for a state to legalize car theft. America’s market regulators and federal
prosecutors likewise need to be able to walk and chew gum at the same time.
Impacts
War
Economic decline triggers multiple impacts such as war and terrorism
Royal 10 - Jedediah Royal, Director of Cooperative Threat Reduction at the U.S.
Department of Defense, (“Economics of War and Peace: Economic, Legal and Political
Perspectives” 2010 pg 213-215 Accessed 7/6/15)
Less intuitive is how periods of economic decline may increase the likelihood of external conflict.
Political science literature has contributed a moderate degree of attention to the impact of economic
decline and the security and defence behavior of interdependent states. Research in this vein has
been considered at systemic, dyadic and national levels. Several notable contributions follow. First, on
the systemic level, Pollins (2008) advances Modelski and Thompson’s (1996) work on leadership cycle
theory, finding that rhythms in the global economy are associated with the rise and fall of a pre-eminent
power and the often bloody transition from one pre-eminent leader to the next. As such, exogenous
shocks such as economic crises could usher in a redistribution of relative power (see also Gilpin, 1981)
that leads to uncertainty about power balances, increasing the risk of miscalculation (Fearon, 1995).
Alternatively, even a relatively certain redistribution of power could lead to a permissive environment
for conflict as a rising power may seek to challenge a declining power (Werner, 1999). Separately,
Pollins (1996) also shows that global economic cycles combined with parallel leadership cycles impact
the likelihood of conflict among major, medium and small powers, although he suggests that the
causes and connections between global economic conditions and security conditions remain unknown.
Second, on a dyadic level, Copeland’s (1996, 2000) theory of trade expectations suggests that ‘future
expectations of trade’ is a significant variable in understanding economic conditions and security
behavior of states. He argues that interdependent states are likely to gain pacific benefits from trade
so long as they have an optimistic view of future trade relations. However, if the expectations of
future trade decline, particularly for difficult to replace items such as energy resources, the likelihood
for conflict increases, as states will be inclined to use force to gain access to those resources. Crises
could potentially be the trigger for decreased trade expectations either on its own or because it
triggers protectionist moves by interdependent states. Third, others have considered the link between
economic decline and external armed conflict at a national level. Blomberg and Hess (2002) find a
strong correlation between internal conflict and external conflict, particularly during periods of
economic downturn. They write, the linkages between internal and external conflict and prosperity
are strong and mutually reinforcing. Economic conflict tends to spawn internal conflict, which in turn
returns the flavor. Moreover, the presence of a recession tends to amplify the extent to which
international and external conflicts self-reinforce each other. (Blomberg & Hess, 2002, p. 89) Economic
decline has also been linked with an increase in the likelihood of terrorism (Blomberg, Hess, &
Weerapana, 2004), which has the capacity to spill across borders and lead to external tensions.
Furthermore, crises generally reduce the popularity of a sitting government . ‘Diversionary theory’
suggests that, when facing unpopularity arising from economic decline, sitting governments have
increased incentives to fabricate external military conflicts to create a ‘rally around the flag’ effect.
Wang (1996), DeRouen (1995), and Blomberg, Hess, and Thacker (2006) find supporting evidence
showing that economic decline and use of force are at least indirectly correlated. Gelpi (1997), Miller
(1999), and Kisangani and Pickering (2009) suggest that the tendency towards diversionary tactics are
greater for democratic states than autocratic states, due to the fact that democratic leaders are
generally more susceptible to being removed from office due to lack of domestic support. DeRouen
(2000) has provided evidence showing that periods of weak economic performance in the United
States, and thus weak Presidential popularity, are statistically linked to an increase in the use of force.
In summary, recent economic scholarship positively correlates economic integration with an increase in
the frequency of economic crises, whereas political science scholarship links economic decline with
external conflict at systemic, dyadic and national levels. This implied connection between integration,
crises, and armed conflict has not featured prominently in the economic-security debate and deserves
more attention.
Economic decline causes conflict, resource competition, terrorism and war
Kemp, 10 - Director of Regional Strategic Programs at The Nixon Center, served in the White House
under Ronald Reagan, special assistant to the president for national security affairs and senior director
for Near East and South Asian affairs on the National Security Council Staff, Former Director, Middle East
Arms Control Project at the Carnegie Endowment for International Peace, Geoffrey The East Moves
West: India, China, and Asia’s Growing Presence in the Middle East”, p. 233-4)
The second scenario, called Mayhem and Chaos, is the opposite of the first scenario; everything that can
go wrong does go wrong. The world economic situation weakens rather than strengthens, and India,
China, and Japan suffer a major reduction in their growth rates, further weakening the global
economy. As a result, energy demand falls and the price of fossil fuels plummets, leading to a financial
crisis for the energy-producing states, which are forced to cut back dramatically on expansion
programs and social welfare. That in turn leads to political unrest: and nurtures different radical
groups, including, but not limited to, Islamic extremists. The internal stability of some countries is
challenged, and there are more “failed states.” Most serious is the collapse of the democratic
government in Pakistan and its takeover by Muslim extremists, who then take possession of a large
number of nuclear weapons. The danger of war between India and Pakistan increases significantly.
Iran, always worried about an extremist Pakistan, expands and weaponizes its nuclear program. That
further enhances nuclear proliferation in the Middle East, with Saudi Arabia, Turkey, and Egypt joining
Israel and Iran as nuclear states. Under these circumstances, the potential for nuclear terrorism
increases, and the possibility of a nuclear terrorist attack in either the Western world or in the oilproducing states may lead to a further devastating collapse of the world economic market, with a
tsunami-like impact on stability. In this scenario, major disruptions can be expected, with dire
consequences for two-thirds of the planet’s population.
Heg
The economy is key to national security
Flournoy and Fontaine ’15 - Michèle Flournoy is chief executive of the Center for a New American
Security and former undersecretary of defense for policy in the Obama administration. Mr. Fontaine is
president of the center and former foreign-policy adviser. Richard Fontaine is President of the Center for
a New American Security (CNAS). He served as a Senior Advisor and Senior Fellow at CNAS from 20092012 and previously as foreign policy advisor. Worked at the State Department, the National Security
Council and on the staff of the Senate Foreign Relations Committee. 2015 (“Economic Growth Is a
National Security Issue” Available Online at http://www.wsj.com/articles/economic-growth-is-anational-security-issue-1432683397, May 26, 2015, Accessed 7/7/15) N.H
The truth is that national security and economic strength are inextricably linked, and Washington
needs to pursue both. In siloed government agencies, though, they are too often considered in isolation.
America’s economy is the foundation of its military and political power, and boosting growth helps
relieve the downward pressure on defense and foreign-affairs budgets that reduces Washington’s
ability to shape international events. With the world aflame from Syria to Ukraine, and tensions with
China rising, the demand for U.S. power is higher than it has been in decades. The challenge today is
supplying it.
Perceptions of American retrenchment in recent years stem partly from Obama administration policies
and congressional dysfunction—the sequester cuts, remember, were supposed to be so onerous that
lawmakers would never let them take effect. But equally important is that in the wake of the financial
crisis, the country turned inward to focus on creating jobs and reducing income inequality at home
rather than sending aid and personnel abroad.
Until the rise of Islamic State in the Middle East and aggression from Russia in Ukraine, the percentage
of Americans saying that the country should mind its own business internationally was 52%. This figure,
from a December 2013 poll, was the highest ever recorded. The sentiment was driven by pervasive warweariness and the middle class’s increased focus on its pocketbook. Indeed, throughout U.S. history,
periods of economic strife have coincided with America’s trimming its national sails overseas. An
internationally engaged U.S. must be an economically prosperous and confident one.
A bright economic outlook is a powerful counter to the narrative of American decline. It boosts
perceptions of U.S. leadership and thus Washington’s ability to shape and enforce the international
rules of the road, in domains as diverse as trade, maritime security and cyberspace.
U.S. security decline triggers a laundry list of impacts and transition wars
1. Transition wars 2. Asian nuclear war 3. Middle East conflicts 4. Nuclear prolif 5. Nuclear miscalc 6.
Terrorism 7. Piracy 8. Organized Crime 9. Climate Change 10. Disease
Brooks 13 – Stephen Brooks, Associate Professor of Government at Dartmouth College, John Ikenberry,
Albert G. Milbank Professor of Politics and International Affairs at Princeton University and Global
Eminence Scholar at Kyung Hee University in Seoul, John Wohlforth, Daniel Webster Professor of
Government at Dartmouth College (“Lean Forward” Foreign Affairs, Available Online at
https://www.foreignaffairs.com/articles/united-states/2012-11-30/lean-forward, January/February
2013) N.H
Of course, even if it is true that the costs of deep engagement fall far below what advocates of
retrenchment claim, they would not be worth bearing unless they yielded greater benefits. In fact, they
do. The most obvious benefit of the current strategy is that it reduces the risk of a dangerous conflict.
The United States' security commitments deter states with aspirations to regional hegemony from
contemplating expansion and dissuade U.S. partners from trying to solve security problems on their
own in ways that would end up threatening other states. Skeptics discount this benefit by arguing that
U.S. security guarantees aren't necessary to prevent dangerous rivalries from erupting. They maintain
that the high costs of territorial conquest and the many tools countries can use to signal their benign
intentions are enough to prevent conflict. In other words, major powers could peacefully manage
regional multipolarity without the American pacifier. But that outlook is too sanguine. If Washington
got out of East Asia, Japan and South Korea would likely expand their military capabilities and go
nuclear, which could provoke a destabilizing reaction from China. It's worth noting that during the
Cold War, both South Korea and Taiwan tried to obtain nuclear weapons; the only thing that stopped
them was the United States, which used its security commitments to restrain their nuclear
temptations. Similarly, were the United States to leave the Middle East, the countries currently
backed by Washington--notably, Israel, Egypt, and Saudi Arabia--might act in ways that would
intensify the region's security dilemmas. There would even be reason to worry about Europe.
Although it's hard to imagine the return of great-power military competition in a post-American Europe,
it's not difficult to foresee governments there refusing to pay the budgetary costs of higher military
outlays and the political costs of increasing EU defense cooperation. The result might be a continent
incapable of securing itself from threats on its periphery, unable to join foreign interventions on which
U.S. leaders might want European help, and vulnerable to the influence of outside rising powers. Given
how easily a U.S. withdrawal from key regions could lead to dangerous competition, advocates of
retrenchment tend to put forth another argument: that such rivalries wouldn't actually hurt the United
States. To be sure, few doubt that the United States could survive the return of conflict among powers
in Asia or the Middle East--but at what cost? Were states in one or both of these regions to start
competing against one another, they would likely boost their military budgets, arm client states, and
perhaps even start regional proxy wars, all of which should concern the United States, in part because
its lead in military capabilities would narrow. Greater regional insecurity could also produce cascades of
nuclear proliferation as powers such as Egypt, Saudi Arabia, Japan, South Korea, and Taiwan built
nuclear forces of their own. Those countries' regional competitors might then also seek nuclear
arsenals. Although nuclear deterrence can promote stability between two states with the kinds of
nuclear forces that the Soviet Union and the United States possessed, things get shakier when there
are multiple nuclear rivals with less robust arsenals. As the number of nuclear powers increases, the
probability of illicit transfers, irrational decisions, accidents, and unforeseen crises goes up. The case
for abandoning the United States' global role misses the underlying security logic of the current
approach. By reassuring allies and actively managing regional relations, Washington dampens
competition in the world s key areas, thereby preventing the emergence of a hothouse in which
countries would grow new military capabilities. For proof that this strategy is working, one need look no
further than the defense budgets of the current great powers: on average, since 1991 they have kept
their military expenditures as A percentage of GDP to historic lows, and they have not attempted to
match the United States' top-end military capabilities. Moreover, all of the world's most modern
militaries are U.S. allies, and the United States' military lead over its potential rivals .is by many
measures growing. On top of all this, the current grand strategy acts as a hedge against the emergence
regional hegemons. Some supporters of retrenchment argue that the U.S. military should keep its forces
over the horizon and pass the buck to local powers to do the dangerous work of counterbalancing rising
regional powers. Washington, they contend, should deploy forces abroad only when a truly credible
contender for regional hegemony arises, as in the cases of Germany and Japan during World War II and
the Soviet Union during the Cold War. Yet there is already a potential contender for regional hegemony-China--and to balance it, the United States will need to maintain its key alliances in Asia and the military
capacity to intervene there. The implication is that the United States should get out of Afghanistan and
Iraq, reduce its military presence in Europe, and pivot to Asia. Yet that is exactly what the Obama
administration is doing. MILITARY DOMINANCE, ECONOMIC PREEMINENCE Preoccupied with security
issues, critics of the current grand strategy miss one of its most important benefits: sustaining an open
global economy and a favorable place for the United States within it. To be sure, the sheer size of its
output would guarantee the United States a major role in the global economy whatever grand strategy
it adopted. Yet the country's military dominance undergirds its economic leadership. In addition to
protecting the world economy from instability, its military commitments and naval superiority help
secure the sea-lanes and other shipping corridors that allow trade to flow freely and cheaply. Were
the United States to pull back from the world, the task of securing the global commons would get
much harder. Washington would have less leverage with which it could convince countries to
cooperate on economic matters and less access to the military bases throughout the world needed to
keep the seas open. A global role also lets the United States structure the world economy in ways that
serve its particular economic interests. During the Cold War, Washington used its overseas security
commitments to get allies to embrace the economic policies it preferred--convincing West Germany in
the 1960s, for example, to take costly steps to support the U.S. dollar as a reserve currency. U.S. defense
agreements work the same way today. For example, when negotiating the 2011 free-trade agreement
with South Korea, U.S. officials took advantage of Seoul's desire to use the agreement as a means of
tightening its security relations with Washington. As one diplomat explained to us privately, "We asked
for changes in labor and environment clauses, in auto clauses, and the Koreans took it all." Why?
Because they feared a failed agreement would be "a setback to the political and security relationship."
More broadly, the United States wields its security leverage to shape the overall structure of the
global economy. Much of what the United States wants from the economic order is more of the same:
for instance, it likes the current structure of the World Trade Organization and the International
Monetary Fund and prefers that free trade continue. Washington wins when U.S. allies favor this status
quo, and one reason they are inclined to support the existing system is because they value their military
alliances. Japan, to name one example, has shown interest in the Trans-Pacific Partnership, the Obama
administration's most important free-trade initiative in the region, less because its economic interests
compel it to do so than because Prime Minister Yoshihiko Noda believes that his support will strengthen
Japan's security ties with the United States. The United States' geopolitical dominance also helps keep
the U.S. dollar in place as the world's reserve currency, which confers enormous benefits on the country,
such as a greater ability to borrow money. This is perhaps clearest with Europe: the EU'S dependence on
the United States for its security precludes the EU from having the kind of political leverage to support
the euro that the United States has with the dollar. As with other aspects of the global economy, the
United States does not provide its leadership for free: it extracts disproportionate gains. Shirking that
responsibility would place those benefits at risk. CREATING COOPERATION What goes for the global
economy goes for other forms of international cooperation. Here, too, American leadership benefits
many countries but disproportionately helps the United States. In order to counter transnational
threats, such as terrorism, piracy, organized crime, climate change, and pandemics, states have to
work together and take collective action. But cooperation does not come about effortlessly, especially
when national interests diverge. The United States' military efforts to promote stability and its broader
leadership make it easier for Washington to launch joint initiatives and shape them in ways that reflect
U.S. interests. After all, cooperation is hard to come by in regions where chaos reigns, and it flourishes
where leaders can anticipate lasting stability. U.S. alliances are about security first, but they also
provide the political framework and channels of communication for cooperation on nonmilitary
issues. NATO, for example, has spawned new institutions, such as the Atlantic Council, a think tank,
that make it easier for Americans and Europeans to talk to one another and do business. Likewise,
consultations with allies in East Asia spill over into other policy issues; for example, when American
diplomats travel to Seoul to manage the military alliance, they also end up discussing the Trans-Pacific
Partnership. Thanks to conduits such as this, the United States can use bargaining chips in one issue
area to make progress in others. The benefits of these communication channels are especially
pronounced when it comes to fighting the kinds of threats that require new forms of cooperation,
such as terrorism and pandemics. With its alliance system in place, the United States is in a stronger
position than it would otherwise be to advance cooperation and share burdens. For example, the
intelligence-sharing network within NATO, which was originally designed to gather information on the
Soviet Union, has been adapted to deal with terrorism. Similarly, after a tsunami in the Indian Ocean
devastated surrounding countries in 2004, Washington had a much easier time orchestrating a fast
humanitarian response with Australia, India, and Japan, since their militaries were already comfortable
working with one another. The operation did wonders for the United States' image in the region. The
United States' global role also has the more direct effect of facilitating the bargains among governments
that get cooperation going in the first place. As the scholar Joseph Nye has written, "The American
military role in deterring threats to allies, or of assuring access to a crucial resource such as oil in the
Persian Gulf, means that the provision of protective force can be used in bargaining situations.
Sometimes the linkage may be direct; more often it is a factor not mentioned openly but present in the
back of statesmen's minds." THE DEVIL WE KNOW Should America come home? For many prominent
scholars of international relations, the answer is yes--a view that seems even wiser in the wake of the
disaster in Iraq and the Great Recession. Yet their arguments simply don't hold up. There is little
evidence that the United States would save much money switching to a smaller global posture. Nor is
the current strategy self-defeating: it has not provoked the formation of counterbalancing coalitions or
caused the country to spend itself into economic decline. Nor will it condemn the United States to
foolhardy wars in the future. What the strategy does do is help prevent the outbreak of conflict in the
world's most important regions, keep the global economy humming, and make international
cooperation easier. Charting a different course would threaten all these benefits. This is not to say that
the United States' current foreign policy can't be adapted to new circumstances and challenges.
Washington does not need to retain every commitment at all costs, and there is nothing wrong with
rejiggering its strategy in response to new opportunities or setbacks. That is what the Nixon
administration did by winding down the Vietnam War and increasing the United States' reliance on
regional partners to contain Soviet power, and it is what the Obama administration has been doing after
the Iraq war by pivoting to Asia. These episodes of rebalancing belie the argument that a powerful and
internationally engaged America cannot tailor its policies to a changing world. A grand strategy of
actively managing global security and promoting the liberal economic order has served the United
States exceptionally well for the past six decades, and there is no reason to give it up now. The
country's globe-spanning posture is the devil we know, and a world with a disengaged America is the
devil we don't know. Were American leaders to choose retrenchment, they would in essence be running
a massive experiment to test how the world would work without an engaged and liberal leading power.
The results could well be disastrous.
Offcase Links
Politics Links
No political support for the plan
Robinson, 2010 (William Jeremy, Georgetown Law, J.D., “Free at What Cost?: Cloud Computing
Privacy Under the Stored Communications Act” Georgetown Law Journal Vol. 98)
Although Congress has historically favored the enlargement of privacy protections, it is unlikely to
lead the fight to expand online privacy. Congressional inertia can be overcome when the right combination of variables
intersect, including political momentum and societal demand.239 Two main obstacles currently prevent these variables from aligning for online
privacy issues. First, the
SCA itself impedes the adoption of new privacy measures by shrinking the gap
between the existing and ideal degree of privacy protections that Congress might want. Second,
recent congressional actions are reducing the sphere of individual privacy, especially after the
September 11, 2001 terrorist attacks, rather than seeking its expansion.240 The SCA limits the political
value of tackling online privacy issues and, therefore, obstructs efforts to adopt stronger protections.
Congress has a limited capacity to pursue new legislation and it is hard to get its finite attention
focused on a particular issue. Consequently, seeking incremental change in a previously legislated
subject area is particularly difficult.241 The SCA already provides some quantum of privacy in online communications and
content, but as society embraces new technologies, including cloud computing, the balance that the Act struck more than two decades ago may
no longer be appropriate. But aligning the SCA’s provisions with current mainstream views about online privacy would not require dramatic
changes that would generate substantial public attention. Instead, such an effort would likely involve making incremental enhancements to the
Act’s structure, clarifying issues of judicial dispute, or modernizing statutory language.242 Because of
the limited political return
such modest changes would offer, politicians have few incentives to advocate for them.
No Turns – impossible to build support for the plan.
Robinson, 2010 (William Jeremy, Georgetown Law, J.D., “Free at What Cost?: Cloud Computing
Privacy Under the Stored Communications Act” Georgetown Law Journal Vol. 98)
The SCA also influences societal expectations about online privacy and thus minimizes the political
pressure for change. Societal forces can cause both Congress and the courts to revisit privacy protections. Within the judicial realm, the
Court held in Katz v. United States that privacy issues under the Fourth Amendment focus on whether society is prepared to recognize an
expectation of privacy under certain circumstances as being reasonable.243 This approach makes it difficult for privacy advocates to advance
their interests because of the circularity in using societal expectations to define new legal protections for individual privacy when those
expectations are influenced by existing legal protections.244 In
the same circular manner, the SCA’s privacy standards
subtly influence societal norms when they are reflected in media reports, judicial decisions, and terms
of service agreements.245 In the legislative realm, the lack of a significant disparity between societal
privacy expectations and the SCA’s existing protections minimizes the political pressure to bring about
change. Political action is motivated when constituencies expand and engage their members to
generate enough momentum to attract attention.246 Yet, privacy issues attract a limited natural
constituency and building a large coalition of interested online users to generate political change is
difficult247—particularly when the SCA’s existing statutory scheme continues to define and reinforce societal norms about online privacy.
Even if there is societal demand for greater online privacy protections, elected officials and judges
need to recognize that a shift in expectations has happened. However, the demographics of Congress
and the Judiciary make it unlikely that their members are well-positioned to determine society’s
expectations, especially about emerging technologies. Younger people are much more likely to
embrace cloud computing services,248 but the average age of senators249 and House members250—
as well as the Justices251 on the Court—reflects a notable generational gap from this core user
population. Advocates for enhanced online privacy measures will have to bridge this divide and ensure that elected officials and judges
understand the technology and its implications for individual privacy before they can secure their assistance in changing the status quo.
SEC opposition makes any reform to ECPA a huge fight — empirics prove the SEC can
block reform
Fulton 14 — Sandra Fulton, 2014 ("SEC Blocking Update to Electronic Privacy Laws," American Civil
Liberties Union, April 11th, Available Online at https://www.aclu.org/blog/sec-blocking-updateelectronic-privacy-laws, Accessed 7-16-2015)
During the long, hard fight to bring the outdated Electronic Communications Privacy Act (ECPA) into
the 21st century, advocates have run into the most unlikely of opponents: the Securities and Exchange
Commission (SEC). Yes, the SEC—the agency charged with regulating the securities industry—has
brought the ECPA update to a screeching halt. Yesterday the ACLU, along with the Heritage
Foundation, Americans for Tax Reform and the Center for Democracy and Technology, sent the agency a
letter calling them out on their opposition.
ECPA, enacted in 1986, is the main statute protecting our online communications from unauthorized
government access. Unfortunately, as our lives have moved online the law has remained stagnant,
leaving dangerous loopholes in our privacy protections. A broad coalition including privacy and
consumer advocates, civil rights organizations, tech companies, and members of Congress from both
parties has been pushing for an update. Strong bipartisan legislation to update the law has over 200
sponsors and is making serious headway in Congress. Even the Department of Justice—the law
enforcement agency with arguably the most to lose in such an update—testified that some ECPA
loopholes need to be closed.
But the SEC is pushing back—essentially arguing that they should get to keep one of the loopholes
that have developed as the law has aged. When ECPA was passed in 1986, Congress developed an
elaborate framework aimed at mirroring existing constitutional protections. Newer email, less than 180
days old, was accessible only with a warrant. Based on the technology of the time, older email was
assumed to be “abandoned” and was made accessible with a mere subpoena. Similarly, another
category of digital records, “remote computing services,” was created for information you outsourced to
another company for data processing. Seen as similar to business records, it could also be collected
with a subpoena under the law.
Fast forward to the 21st Century. Now we keep a decade of email in our inboxes and "remote
computing services” has morphed into Facebook keeping all our photos or Microsoft storing our Word
documents in their cloud. Suddenly the SEC can access content in way it never could before.
But in 2010 the 6th Circuit, in United States v Warshak, ruled that email was protected by the Fourth
Amendment. Since the SEC doesn’t have the power to get a search warrant, they lost the benefit of the
loophole that they had been exploiting.. Up until now this hasn’t seemed like a big deal. They have never
legally challenged this prohibition or been able to identify a case, pre- or post-Warshak, where they
have really needed this authority; they already have a wide range of tools at their disposal.
So while the SEC is trying to frame the issue as a loss of authority, it is really a power grab—one that
would apply not just to the SEC but all federal and state agencies, including the IRS, DEA, and even
state health boards.
Even if the plan has some support, the SEC blocks passage — regardless of the truth of
the SEC’s claims, congress is buying it
Rottman and Mcauliffe 15 — Gabe Rottman and Katie Mcauliffe, 2015 ("How Congress Can Protect
Americans' Email Privacy," Roll Call, January 27th, Available Online at
http://www.rollcall.com/news/how_congress_can_protect_americans_email_privacy_commentary239611-1.html?pg=1&dczone=opinion, Accessed 7-14-2015)
Congress should have passed the bipartisan ECPA reform bills last year. But one federal agency, the
Securities and Exchange Commission, essentially blocked its passage. As a civil regulatory agency, the
SEC doesn’t have warrant authority. It only has subpoena power. By holding up ECPA reform, it’s
trying to obtain the power of a warrant with the lower standards of proof required to issue a
subpoena. In short, the SEC wants indiscriminate power to investigate American businesses and their
employees and customers by gaining access to private records and property stored online, without
convincing a judge a crime is likely being committed. That is an unprecedented, unnecessary and unjust
power grab, and rather than acquiescing to it, members of Congress should regard it as a cause to
rebuke the agency that attempted it.
Terror Links
Even privacy advocates support keeping the SCA to stop threats
Wyden et al. 14 — Ron Wyden, senator from Oregon since 1996, member of Senate Select
Committee on Intelligence with access to classified meta-date program information, Mark Udall, Senator
from Colorado from 2009 to 2015, also a member of the Senate Select Committee on Intelligence, and
Martin Heinrich, senator from New Mexico, 2014 (. “BRIEF FOR AMICI CURIAE SENATOR RON WYDEN,
SENATOR MARK UDALL, AND SENATOR MARTIN HEINRICH IN SUPPORT OF PLAINTIFF-APPELLANT,
URGING REVERSAL OF THE DISTRICT COURT,” Electronic Frontier Foundation, submitted to Smith v.
Obama, September 9th, Available online at https://www.eff.org/document/wyden-udall-heinrich-smithamicus, Accessed 7-16-15)
For example, the Stored Communications Act permits the government to obtain precisely the same
call records that are now acquired through bulk collection under section 215 when they are “relevant
and material to an ongoing criminal investigation.” 18 U.S.C. §2703 (d). Individualized orders for phone
records, as opposed to orders authorizing bulk collection, can also be obtained under section 215. 50
U.S.C. §1861.7National security letters, which do not require a court order, can also be used by the
government to obtain call records for intelligence purposes. See18 U.S.C. §2709. The government can
also acquire telephony metadata on a real-time basis by obtaining orders from either regular federal
courts or the FISC for the installation of pen registers or trap-and-trace devices. See18 U.S.C. §§3122,
3125; 50 U.S.C. §1842. And the government may also seek call records using standard criminal warrants
based on probable cause. See 18 U.S.C. §2703 (c)(A); Fed. R. Crim. P. 17(c). The government can use
many of these authorities without any more evidence than what is currently required to use the bulk
phone-records database, with less impact on the privacy interests of innocent Americans.
SCA is used for tracking in tens of thousands of cases
Witmer-Rich 14 — Jonathan Witmer-Rich, Assistant Professor of Law at Cleveland-Marshall College of
Law of Cleveland State University, JD from University of Michigan School of Law B.A. from Goshen
College 2014 (“The Rapid Rise of Delayed Notice Searches, and the Fourth Amendment "Rule Requiring
Notice,” Pepperdine Law Review, Available to subscribing institutions via Lexis-Nexis, Accessed 7-16-15)
The volume of cell phone location tracking is huge, with one federal judge estimating in 2011 that
"federal courts alone approve 20,000-30,000 tracking requests annually, and the number is rising."
n187 These different cell phone tracking technologies are governed by a variety of different legal
regimes, and there is considerable uncertainty about which legal regimes govern which types of
tracking. n188 In many cases, investigators have been able to covertly track cell phone locations
without using a search warrant, for example through court orders under 18 U.S.C. § 2703(d) (the
Stored Communications Act) or pen/trap orders under 18 U.S.C. § 3123. n189
In recent years, a number of federal magistrate judges have begun demanding that police obtain search
warrants for various categories of cell phone tracking data, while other courts continue to permit
investigators to use less stringent forms of statutory authority. n190 Amidst this uncertainty, it is clear
that investigators are increasingly (though not uniformly) using Fourth Amendment search warrants to
conduct various kinds of cell phone location tracking, and that those warrants are always delayed notice
[*544] warrants. n191 Some courts have been requiring search warrants for at least some types of cell
phone location data (such as prospective, real-time tracking) since at least 2005. n192
To the extent investigators engage in covert cell phone location tracking using statutory orders that are
not search warrants, that practice will not be reported in the Delayed Notice Reports (which reports on
"warrants" issued under § 3103a). But to the extent investigators conduct the exact same covert
tracking using search warrants, that tracking will be reported in the Delayed Notice Reports. It is
impossible to determine precisely what percentage of the delayed notice search warrants in the covered
years (2006-2012) are warrants for cell phone location tracking. Some investigators likely continue to
perform this tracking without using reported search warrants. n193 But given the judicial pressure to
use search warrants, it is quite likely that investigators are increasingly using reported search warrants
to conduct cell phone location tracking. n194 This shift--from conducting covert cell location tracking
searches with court orders, to conducting that same covert tracking with delayed notice search
warrants--would result in a steady increase in the reported number of "delayed notice search warrants"
in the Delayed Notice Reports. This increase would appear even if the total number of covert cell phone
location tracking remained constant.
E-mail messages. A similar trend may be occurring with covert searches of e-mail messages, although
the time frame here is somewhat more recent. At least since 2010, however, and arguably since 2007 or
earlier, investigators have been under increasing pressure to use delayed notice search warrants
(reported in the Delayed Notice Reports) for any [*545] covert searching of e-mail messages, instead of
using other (unreported) legal mechanisms to do so. n195
Access to e-mail messages is governed by the Stored Communications Act (SCA), passed by Congress in
1986. n196 Under the SCA, investigators can obtain e-mail messages in several ways, some of which
do not require a search warrant. Depending on the circumstances, investigators can obtain e-mail
messages by using a subpoena, with a court order under § 2703(d), or with a search warrant. n197 In
some cases, investigators want to access e-mail records without notifying the owner of the account,
and the SCA expressly authorizes that practice in specified circumstances. n198 Indeed, recall that it is
precisely this list, from the SCA, that Congress chose to cross-reference in section 3103a for delayed
notice search warrants. n199
In short, investigators in past years have been able to obtain e-mail messages without using search
warrants (at least in some circumstances), and often have been able to obtain those e-mails covertly,
without giving notice to the account holder until some later date. n200 These covert e-mail searches-if conducted without search warrants--would not have been reported in the annual Delayed Notice
Reports