Be very afraid, please

Reuters

AMERICA and Israel often hint at military action to stop Iran’s suspected nuclear-weapons programme. The latest rumblings, however, may be more serious. The atmosphere has been charged by a combination of factors: Iran’s expanding uranium-enrichment programme, faltering diplomatic efforts to halt it, a dying American administration and a nervous Israel. Throw in the latest war games by Israel, America and Iran—and Iran’s apparent rejection of the latest international incentives to halt its nuclear work—and some reckon the sparks could soon fly.

On July 9th Iranian television showed the test-firing of nine missiles (see picture), a day after an aide to the supreme leader, Ayatollah Ali Khamenei, threatened to “burn” Tel Aviv and American ships in the Gulf, and strike at America’s “vital interests around the globe”, if it were attacked. More tests took place on July 10th.

This was a response to Israel’s demonstration of its own long arm in June, when about 100 Israeli jets took part in exercises that appeared to rehearse the bombing of distant targets. Western officials were struck by helicopter sorties of more than 800 miles (1,290km), about the distance from Israel to Iran, to simulate the rescue of downed pilots. Israel conducted the exercise with Greece, rather than its traditional partner, Turkey, maybe because Greece has some of the Russian SA-20 anti-aircraft missiles Iran recently bought.

In the Gulf, meanwhile, American, British and Bahraini ships are involved in a joint exercise to protect gas and oil installations. This seems to be a reaction to Iran’s threats to retaliate against any attack by closing the Strait of Hormuz, the passage for roughly 40% of the world’s traded oil, and striking at neighbouring countries.

Does this public bellicosity really make military action more likely? Mahmoud Ahmadinejad, Iran’s president, dismissed the idea this week as a “funny joke”. And, yes, Israel could well be bluffing, waving its big stick in order to make the rewards the Europeans, Americans, Russians and Chinese are offering Iran in return for an end to uranium enrichment look more tempting. But whether or not Israel has frightened Iran, it has clearly rattled others.

France’s Total, an energy giant, said this week it was giving up plans to invest in Iran because of the risk. A top British government official puts the chance of an Israeli strike at 30%. Admiral Mike Mullen, chairman of America’s Joint Chiefs of Staff, was worried enough to say publicly that a third war (after Afghanistan and Iraq) would be “extremely stressful, very challenging, with consequences that would be difficult to predict”. As to whether Israel might act alone, he said: “This is a very unstable part of the world, and I don’t need it to become more unstable.”

One uncertainty is how close Iran is to being able to make a nuclear weapon (an aspiration it vehemently denies). America’s controversial National Intelligence Estimate, made public in December, said that Iran had indeed run a weaponisation programme but seemed to stop it in 2003. The Iranians continue (despite UN sanctions) to enrich uranium, but most Western experts think they have much to learn before being able to make the high-enriched variety for a bomb. America’s estimate is that the soonest Iran could make enough for one device would be the end of 2009, but that it could take five or more years longer.

Israeli officials are less sanguine. So far Iran has produced only a small amount of low-enriched uranium, but this could eventually be converted to the bomb-making sort. For all its sabre-rattling, Israel still says that diplomacy is preferable to war. But a number of political and military considerations may yet convince Israel to act alone—sooner rather than later.

One of these is the departure of the friendly Bush administration and the possible advent of a President Obama, who has promised to do “everything” to stop Iran getting a bomb but who is distrusted by many Israelis. Another is that Iran’s Russian-built reactor at Bushehr is due to start working in October. This is less worrying than the underground enrichment facility at Natanz. But if Israel intends to bomb it, it would be best to do so before it is loaded with nuclear fuel. Finally, it would be easier for Israel to act before Iran deploys its SA-20s, which may happen in early 2009.

That said, an effective attack against Iran’s buried and dispersed nuclear facilities would not be easy, even if Israel knew where all of them were. There will be no element of surprise, as when Israel bombed Iraq’s nuclear reactor in 1981, and a Syrian facility which America said afterwards was a secret reactor last September.

Another unknown is whether Israel would dare to strike Iran without a green or at least an amber light from the Americans. Without one, flying to Iran the direct way—through American-controlled Iraqi airspace—would be fraught with danger. An unauthorised Israeli strike that added to America’s miscellaneous woes in the Middle East would test even the closest alliance, jeopardising Israel’s relationship with its vital patron and armourer.

Against this must be weighed Israel’s visceral sense of vulnerability, sharpened not only by the Jewish state’s history but also by the implacability of Iran, whose government rules out any accommodation with the “Zionist regime” and repeatedly predicts its disappearance. Nobody can be quite sure that in a corner, confronting what it believed to be existential peril, Israel will not act—alone if necessary.

Your morning medicine?

Coffee drinkers will tell you that their brains don’t really work until they’ve had their morning cups. Well, this week, neuroscientists announced that those caffeinated cups may actually protect drinkers’ brains–by shoring up a remarkable bit of anatomy known as the blood-brain barrier.

Marvelous Membrane

First noticed by doctors more than 100 years ago, the blood-brain barrier is a sort of physiological filtering system inside the tiny capillaries (blood vessels) inside your head. It helps to protect your brain from chemicals and other “foreign bodies” that may be floating in your blood, including things that do you no harm as long as they don’t invade your brain.

By allowing only certain tiny molecules to squeeze between protective cells, the blood-brain barrier protects your mental machinery from infection–even as it enables essential communication between your brain and your blood.

“Great,” you say, “but what does that have to do with my coffee?” Maybe a lot, especially if your diet isn’t perfect. A new study by U.S. researchers suggests that a daily caffeine supplement, equivalent to a single cup of joe, could help keep your blood-brain barrier hale and hearty.

Caffeine vs. Cholesterol

Previous research has shown that high cholesterol can lead to “leaks” in the blood-brain barrier (and may play a role in the development of Alzheimer’s disease). Meanwhile, other previous research has pointed to a possible connection between brain health and coffee drinking.

So, for 12 weeks, the researchers fed lab rabbits high-cholesterol diets. They also gave some of their rabbits daily caffeine supplements. Then they tested the rabbits’ blood-brain barriers for damage. Result: the caffeinated rabbits had significantly less blood-brain barrier leakage.

Of course, that doesn’t mean your doctor is about to start prescribing coffee. But it certainly is food for thought. As the study’s lead researcher notes, “caffeine is a safe and readily available drug, and its ability to stabilize the blood-brain barrier means it could have an important part to play in therapies against neurological disorders.” Plus, it’s one medicine many would find easy to swallow.

–Steve Sampson

Terror Fight Blurs

Line Over Domain;
Tracking Email

By SIOBHAN GORMAN
March 10, 2008; Page A1

WASHINGTON, D.C. — Five years ago, Congress killed an experimental Pentagon antiterrorism program meant to vacuum up electronic data about people in the U.S. to search for suspicious patterns. Opponents called it too broad an intrusion on Americans’ privacy, even after the Sept. 11 terrorist attacks.

But the data-sifting effort didn’t disappear. The National Security Agency, once confined to foreign surveillance, has been building essentially the same system.

The central role the NSA has come to occupy in domestic intelligence gathering has never been publicly disclosed. But an inquiry reveals that its efforts have evolved to reach more broadly into data about people’s communications, travel and finances in the U.S. than the domestic surveillance programs brought to light since the 2001 terrorist attacks.

Congress now is hotly debating domestic spying powers under the main law governing U.S. surveillance aimed at foreign threats. An expansion of those powers expired last month and awaits renewal, which could be voted on in the House of Representatives this week. The biggest point of contention over the law, the Foreign Intelligence Surveillance Act, is whether telecommunications and other companies should be made immune from liability for assisting government surveillance.

Largely missing from the public discussion is the role of the highly secretive NSA in analyzing that data, collected through little-known arrangements that can blur the lines between domestic and foreign intelligence gathering. Supporters say the NSA is serving as a key bulwark against foreign terrorists and that it would be reckless to constrain the agency’s mission. The NSA says it is scrupulously following all applicable laws and that it keeps Congress fully informed of its activities.

According to current and former intelligence officials, the spy agency now monitors huge volumes of records of domestic emails and Internet searches as well as bank transfers, credit-card transactions, travel and telephone records. The NSA receives this so-called “transactional” data from other agencies or private companies, and its sophisticated software programs analyze the various transactions for suspicious patterns. Then they spit out leads to be explored by counterterrorism programs across the U.S. government, such as the NSA’s own Terrorist Surveillance Program, formed to intercept phone calls and emails between the U.S. and overseas without a judge’s approval when a link to al Qaeda is suspected.

The NSA’s enterprise involves a cluster of powerful intelligence-gathering programs, all of which sparked civil-liberties complaints when they came to light. They include a Federal Bureau of Investigation program to track telecommunications data once known as Carnivore, now called the Digital Collection System, and a U.S. arrangement with the world’s main international banking clearinghouse to track money movements.

The effort also ties into data from an ad-hoc collection of so-called “black programs” whose existence is undisclosed, the current and former officials say. Many of the programs in various agencies began years before the 9/11 attacks but have since been given greater reach. Among them, current and former intelligence officials say, is a longstanding Treasury Department program to collect individual financial data including wire transfers and credit-card transactions.

It isn’t clear how many of the different kinds of data are combined and analyzed together in one database by the NSA. An intelligence official said the agency’s work links to about a dozen antiterror programs in all.

A number of NSA employees have expressed concerns that the agency may be overstepping its authority by veering into domestic surveillance. And the constitutional question of whether the government can examine such a large array of information without violating an individual’s reasonable expectation of privacy “has never really been resolved,” said Suzanne Spaulding, a national-security lawyer who has worked for both parties on Capitol Hill.

NSA officials say the agency’s own investigations remain focused only on foreign threats, but it’s increasingly difficult to distinguish between domestic and international communications in a digital era, so they need to sweep up more information.

The Fourth Amendment

In response to the Sept. 11 attacks, then NSA-chief Gen. Michael Hayden has said he used his authority to expand the NSA’s capabilities under a 1981 executive order governing the agency. Another presidential order issued shortly after the attacks, the text of which is classified, opened the door for the NSA to incorporate more domestic data in its searches, one senior intelligence official said.

The NSA “strictly follows laws and regulations designed to preserve every American’s privacy rights under the Fourth Amendment to the U.S. Constitution,” agency spokeswoman Judith Emmel said in a statement, referring to the protection against unreasonable searches and seizures. The Office of the Director of National Intelligence, which oversees the NSA in conjunction with the Pentagon, added in a statement that intelligence agencies operate “within an extensive legal and policy framework” and inform Congress of their activities “as required by the law.” It pointed out that the 9/11 Commission recommended in 2004 that intelligence agencies analyze “all relevant sources of information” and share their databases.

Two former officials familiar with the data-sifting efforts said they work by starting with some sort of lead, like a phone number or Internet address. In partnership with the FBI, the systems then can track all domestic and foreign transactions of people associated with that item — and then the people who associated with them, and so on, casting a gradually wider net. An intelligence official described more of a rapid-response effect: If a person suspected of terrorist connections is believed to be in a U.S. city — for instance, Detroit, a community with a high concentration of Muslim Americans — the government’s spy systems may be directed to collect and analyze all electronic communications into and out of the city.

The haul can include records of phone calls, email headers and destinations, data on financial transactions and records of Internet browsing. The system also would collect information about other people, including those in the U.S., who communicated with people in Detroit.

The information doesn’t generally include the contents of conversations or emails. But it can give such transactional information as a cellphone’s location, whom a person is calling, and what Web sites he or she is visiting. For an email, the data haul can include the identities of the sender and recipient and the subject line, but not the content of the message.

Intelligence agencies have used administrative subpoenas issued by the FBI — which don’t need a judge’s signature — to collect and analyze such data, current and former intelligence officials said. If that data provided “reasonable suspicion” that a person, whether foreign or from the U.S., was linked to al Qaeda, intelligence officers could eavesdrop under the NSA’s Terrorist Surveillance Program.

The White House wants to give companies that assist government surveillance immunity from lawsuits alleging an invasion of privacy, but Democrats in Congress have been blocking it. The Terrorist Surveillance Program has spurred 38 lawsuits against companies. Current and former intelligence officials say telecom companies’ concern comes chiefly because they are giving the government unlimited access to a copy of the flow of communications, through a network of switches at U.S. telecommunications hubs that duplicate all the data running through it. It isn’t clear whether the government or telecom companies control the switches, but companies process some of the data for the NSA, the current and former officials say.

On Friday, the House Energy and Commerce Committee released a letter warning colleagues to look more deeply into how telecommunications data are being accessed, citing an allegation by the head of a New York-based computer security firm that a wireless carrier that hired him was giving unfettered access to data to an entity called “Quantico Circuit.” Quantico is a Marine base that houses the FBI Academy; senior FBI official Anthony DiClemente said the bureau “does not have ‘unfettered access’ to any communication provider’s network.”

The political debate over the telecom information comes as intelligence agencies seek to change traditional definitions of how to balance privacy rights against investigative needs. Donald Kerr, the deputy director of national intelligence, told a conference of intelligence officials in October that the government needs new rules. Since many people routinely post details of their lives on social-networking sites such as MySpace, he said, their identity shouldn’t need the same protection as in the past. Instead, only their “essential privacy,” or “what they would wish to protect about their lives and affairs,” should be veiled, he said, without providing examples.

Social-Network Analysis

The NSA uses its own high-powered version of social-network analysis to search for possible new patterns and links to terrorism. The Pentagon’s experimental Total Information Awareness program, later renamed Terrorism Information Awareness, was an early research effort on the same concept, designed to bring together and analyze as much and as many varied kinds of data as possible. Congress eliminated funding for the program in 2003 before it began operating. But it permitted some of the research to continue and TIA technology to be used for foreign surveillance.

Some of it was shifted to the NSA — which also is funded by the Pentagon — and put in the so-called black budget, where it would receive less scrutiny and bolster other data-sifting efforts, current and former intelligence officials said. “When it got taken apart, it didn’t get thrown away,” says a former top government official familiar with the TIA program.

Two current officials also said the NSA’s current combination of programs now largely mirrors the former TIA project. But the NSA offers less privacy protection. TIA developers researched ways to limit the use of the system for broad searches of individuals’ data, such as requiring intelligence officers to get leads from other sources first. The NSA effort lacks those controls, as well as controls that it developed in the 1990s for an earlier data-sweeping attempt.

Sen. Ron Wyden, an Oregon Democrat and member of the Senate Intelligence Committee who led the charge to kill TIA, says “the administration is trying to bring as much of the philosophy of operation Total Information Awareness as it can into the programs they’re using today.” The issue has been overshadowed by the fight over telecoms’ immunity, he said. “There’s not been as much discussion in the Congress as there ought to be.”

Opportunity for Debate

But Sen. Kit Bond of Missouri, the ranking Republican on the committee, said by email his committee colleagues have had “ample opportunity for debate” behind closed doors and that each intelligence program has specific legal authorization and oversight. He cautioned against seeing a group of intelligence programs as “a mythical ‘big brother’ program,” adding, “that’s not what is happening today.”

READ THE RULING

While the Fourth Amendment guarantees “[t]he right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures,” the legality of data-sweeping relies on the government’s interpretation of a 1979 Supreme Court ruling allowing records of phone calls — but not actual conversations — to be collected without a warrant. Read the ruling.¹

The legality of data-sweeping relies largely on the government’s interpretation of a 1979 Supreme Court ruling allowing records of phone calls — but not actual conversations — to be collected without a judge issuing a warrant. Multiple laws require a court order for so-called “transactional’” records of electronic communications, but the 2001 Patriot Act lowered the standard for such an order in some cases, and in others made records accessible using FBI administrative subpoenas called “national security letters.” (Read the ruling.²)

A debate is brewing among legal and technology scholars over whether there should be privacy protections when a wide variety of transactional data are brought together to paint what is essentially a profile of an individual’s behavior. “You know everything I’m doing, you know what happened, and you haven’t listened to any of the contents” of the communications, said Susan Landau, co-author of a book on electronic privacy and a senior engineer at Sun Microsystems Laboratories. “Transactional information is remarkably revelatory.”

Ms. Spaulding, the national-security lawyer, said it’s “extremely questionable” to assume Americans don’t have a reasonable expectation of privacy for data such as the subject-header of an email or a Web address from an Internet search, because those are more like the content of a communication than a phone number. “These are questions that require discussion and debate,” she said. “This is one of the problems with doing it all in secret.”

Gen. Hayden, the former NSA chief and now Central Intelligence Agency director, in January 2006 publicly defended the activities of the Terrorist Surveillance Program after it was disclosed by the New York Times. He said it was “not a driftnet over Lackawanna or Fremont or Dearborn, grabbing all communications and then sifting them out.” Rather, he said, it was carefully targeted at terrorists. However, some intelligence officials now say the broader NSA effort amounts to a driftnet. A portion of the activity, the NSA’s access to domestic phone records, was disclosed by a USA Today article in 2006.

The NSA, which President Truman created in 1952 through a classified presidential order to be America’s ears abroad, has for decades been the country’s largest and most secretive intelligence agency. The order confined NSA spying to “foreign governments,” and during the Cold War the NSA developed a reputation as the world’s premier code-breaking operation. But in the 1970s, the NSA and other intelligence agencies were found to be using their spy tools to monitor Americans for political purposes. That led to the original FISA legislation in 1978, which included an explicit ban on the NSA eavesdropping in the U.S. without a warrant.

Big advances in telecommunications and database technology led to unprecedented data-collection efforts in the 1990s. One was the FBI’s Carnivore program, which raised fears when it was in disclosed in 2000 that it might collect telecommunications information about law-abiding individuals. But the ground shifted after 9/11. Requests for analysis of any data that might hint at terrorist activity flooded from the White House and other agencies into NSA’s Fort Meade, Md., headquarters outside Washington, D.C., one former NSA official recalls. At the time, “We’re scrambling, trying to find any piece of data we can to find the answers,” the official said.

The 2002 congressional inquiry into the 9/11 attacks criticized the NSA for holding back information, which NSA officials said they were doing to protect the privacy of U.S. citizens. “NSA did not want to be perceived as targeting individuals in the United States” and considered such surveillance the FBI’s job, the inquiry concluded.

FBI-NSA Projects

The NSA quietly redefined its role. Joint FBI-NSA projects “expanded exponentially,” said Jack Cloonan, a longtime FBI veteran who investigated al Qaeda. He pointed to national-security letter requests: They rose from 8,500 in 2000 to 47,000 in 2005, according to a Justice Department inspector general’s report last year. It also said the letters permitted the potentially illegal collection of thousands of records of people in the U.S. from 2003-05. Last Wednesday, FBI Director Robert Mueller said the bureau had found additional instances in 2006.

It isn’t known how many Americans’ data have been swept into the NSA’s systems. The Treasury, for instance, built its database “to look at all the world’s financial transactions” and gave the NSA access to it about 15 years ago, said a former NSA official. The data include domestic and international money flows between bank accounts and credit-card information, according to current and former intelligence officials.

The NSA receives from Treasury weekly batches of this data and adds it to a database at its headquarters. Prior to 9/11, the database was used to pursue specific leads, but afterward, the effort was expanded to hunt for suspicious patterns.

Through the Treasury, the NSA also can access the database of the Society for Worldwide Interbank Financial Telecommunication, or Swift, the Belgium-based clearinghouse for records of international transactions between financial institutions, current and former officials said. The U.S. acknowledged in 2006 that the CIA and Treasury had access to Swift’s database, but said the NSA’s Terrorism Surveillance Program was separate and that the NSA provided only “technical assistance.” A Treasury spokesman said the agency had no comment.

Through the Department of Homeland Security, airline passenger data also are accessed and analyzed for suspicious patterns, such as five unrelated people who repeatedly fly together, current and former intelligence officials said. Homeland Security shares information with other agencies only “on a limited basis,” spokesman Russ Knocke said.

NSA gets access to the flow of data from telecommunications switches through the FBI, according to current and former officials. It also has a partnership with FBI’s Digital Collection system, providing access to Internet providers and other companies. The existence of a shadow hub to copy information about AT&T Corp. telecommunications in San Francisco is alleged in a lawsuit against AT&T filed by the civil-liberties group Electronic Frontier Foundation, based on documents provided by a former AT&T official. In that lawsuit, a former technology adviser to the Federal Communications Commission says in a sworn declaration that there could be 15 to 20 such operations around the country. Current and former intelligence officials confirmed a domestic network of hubs, but didn’t know the number. “As a matter of policy and law, we can not discuss matters that are classified,” said FBI spokesman John Miller.

The budget for the NSA’s data-sifting effort is classified, but one official estimated it surpasses $1 billion. The FBI is requesting to nearly double the budget for the Digital Collection System in 2009, compared with last year, requesting $42 million. “Not only do demands for information continue to increase, but also the requirement to facilitate information sharing does,” says a budget justification document, noting an “expansion of electronic surveillance activity in frequency, sophistication, and linguistic needs.”

And the winner isn’t . . .

Hollywood’s hottest will gather for the 80th Annual Academy Awards on Sunday. Whoever gets the Oscars, you can bet that fans of unrewarded flicks will argue that Academy voters ignored a classic work of art. And it won’t be the first time.

Arguments over Oscar-winning movies are endless (Patton: modern masterpiece or inconsequential piece of fluff?). But it is inarguable that many enduring classics were sadly overlooked by the Academy voters of their day. So today, KnowledgeNews honors the dishonored with our list of the Top 5 Most Snubbed Motion Pictures, Oscars Edition.

1. Citizen Kane (1941)

The Academy Awards celebrate artistry in motion pictures, but you’d never have guessed that on Oscar Night 1942, when How Green Was My Valley beat Citizen Kane for best picture. Orson Welles’s difficult masterpiece garnered nominations aplenty: best picture, best actor, best director, and more. But at the end of the day, the only award the film received was for best original screenplay. Welles’s consolation was that later generations would celebrate Kane as perhaps the greatest motion picture of all time.

2. Chinatown (1974)

If you think that being nominated for an Oscar is what’s important, then Roman Polanski’s seminal detective drama–starring Jack Nicholson with a band-aid on his schnoz–did just fine. It was nominated for 11 awards, including best picture, best actor and actress, and best director. Luckily, it was also nominated for best screenplay, because that was the only award it won. The Godfather Part II was also in the running that year, and Chinatown couldn’t keep pace.

3. Double Indemnity (1944)

Billy Wilder would have been happy to share Polanski’s fate. His film–which many call the greatest of all film noirs–was also nominated for many awards, including best picture, best actress, and best director. But it didn’t win even one. The alleged best picture this time out was Going My Way, a feel-good musical starring Bing Crosby as the new priest in a troubled Catholic parish. Perhaps wartime America found it easier to celebrate sentiment over cynicism. A month after the awards ceremony, Allied forces took Berlin.

4. Singin’ in the Rain (1952)

Jealousy is an ugly emotion, but you could probably forgive co-directors Gene Kelly and Stanley Donen if they were a touch bitter after seeing their picture–arguably the best musical of all time–receive just two nominations (for best supporting actress and best musical score) and no awards. A Cecil B. DeMille circus extravaganza, The Greatest Show on Earth, somehow managed to bag the award for best picture that year, while classics like Singin’ in the Rain, High Noon, and The Quiet Man went down to defeat. Perhaps the sight of Charlton Heston in tights addled the voters’ minds.

5. Some Like It Hot (1959)

Is winning that much better than losing if all you can win is a relatively trivial award? Billy Wilder’s manic comedy garnered some respectable nominations (like best actor, best director, and best screenplay), but all it won was the award for best costume design. Apparently, Jack Lemmon really looked good in that dress. The big winner that year was Ben-Hur, meaning that the Academy thought a costume drama was better than Some Like It Hot in everything except costumes.

Special Lifetime Snub Award

And the special Lifetime Snub Award goes to . . .

Alfred Hitchcock.

In his day, Hitchcock was dismissed as an intellectual lightweight, pandering to the public in a series of shallow suspense films. The Academy was at the forefront of the anti-Hitch movement and bestowed a grand total of zero awards on three of his best films: Rear Window (1954), North By Northwest (1959), and Psycho (1960).

It’s true: Hitchcock gave the people what they wanted–and what they wanted were stylish, intelligent, well-made movies with strong characters and an absorbing story. Not surprisingly, Hitchcock’s movies have survived the test of time, while his more-honored contemporaries have fallen into obscurity. So when you watch this year’s Academy Awards, keep one thing in mind: today’s Oscar also-rans might prove to be tomorrow’s timeless classics.

–Mark Diller

Economists’ two cents on economic stimulation

“Economic stimulation” is the phrase of the day. Last week, President Bush outlined a $150 billion program to boost the U.S. economy. This weekend, leaders from both parties promised a bipartisan effort to pass stimulating legislation. Meanwhile, stock markets worldwide plunged–thanks partly to fears of a U.S. recession.

When the economy starts to slide, it’s natural to look for ways to stimulate it. The trick is coming up with the right strategy. Fortunately, the world is full of economists ready to give you advice. Unfortunately, they rarely agree with each other, so you’ll have to choose from their competing theories. Here a quick review of three fiscal policy ideas you could adopt–if you decide to run for office.

Idea #1: Create Jobs

That’s what British economist John Maynard Keynes thought. Keynes learned classical economics, which held that market forces alone could produce full employment and a robust economy. Yet he worked during the Great Depression, when it looked like high unemployment might never go away.

It was a vicious circle. High unemployment meant low demand, since fewer consumers were drawing a good salary. And once production outstripped demand, businesses cut costs by laying off even more workers.

Keynes’s solution: create jobs. Governments can spend revenue on public works projects, artificially creating jobs for the unemployed. That will increase their buying power and lift consumer demand. Once businesses see this increase in demand, they will ramp up production, hire new workers, and eliminate the need for the government spending.

Idea #2: Cut Taxes

The economic rationale for cutting taxes is straightforward: tax cuts can put more money in people’s pockets. Like government spending to create jobs, they can increase consumers’ buying power and lift consumer demand.

“Supply-siders” go further, arguing that it’s not just about increasing consumer demand. They point out that high taxes can reduce people’s incentive to work and invest–that you’re less likely to try to make a buck if the IRS takes 70 cents than if the IRS takes 35.

So, they say, cutting taxes–especially high taxes that distort people’s choices–can make markets work more efficiently and spur overall economic growth. Some even argue that cutting taxes can increase tax revenues, as the tax cuts will have such a stimulating effect on the economy that tax revenues will actually rise despite the lower rates.

Idea #3: Go on Vacation

Economists like to talk about “three lags” that hamstring efforts to stimulate the economy: the time it takes for policymakers to realize there are problems, the time it takes for them to do something about it, and the time it takes for their efforts to have a measurable effect.

By the time these three lags have run their course, the economy might well have changed direction–and your stimulus policy could do more harm than good. So, some economists think that the best stimulus is no stimulus at all: take a break, leave the economy alone, and you can be sure at least that you won’t make things worse.

Extra! Extra!
What’s the Fed Got to Do with It?

“Okay,” you say, “but you haven’t even mentioned the Fed. Its rate cut this morning made big news. How does that work?” To find out, review what the Fed does.

What would Ben Franklin think?

//

Friends, America’s Federal Communications Commission voted on Tuesday to let media companies own both a newspaper and a television or radio station in the nation’s 20 largest media markets. The controversial decision reverses a longstanding ban on such cross-media conglomeration.

Opponents of the change say the old rule helped prevent major media companies from becoming too dominant. Supporters say the new rule simply recognizes a changing media landscape, in which newspapers are struggling to find readers and more folks find the information they need online.

Either way, we say it’s a good time to look back at American media’s roots–to a time when local voices like Ben Franklin’s dominated. After all, before he messed around with lightning or charmed French royalty, old Ben was a newspaperman.

An Ink-Stained Wretch

Back then, printers did it all–interviewing recently arrived ship captains for out-of-town news, writing articles, plagiarizing stories from other newspapers, selling ads, printing the pages, and distributing the final product. In fact, most colonial newspapers sprang from small printshops that employed just the owner and his teenage apprentice.

Ben Franklin started in the printing trade as an apprentice to his older brother, James, who ran a small printshop in Boston. Working there exposed the young Franklin to different kinds of writing and gave him a chance to borrow books on the sly from booksellers’ apprentices.

In those days, printers had to be smart and strong. Composing the pages was a mental feat–type was set letter by letter, using little blocks of metal, and for the page to appear correctly when printed, every line had to be composed in reverse. (Many printers were as adept at reading backward as forward.) After the pages were made, the printer personally pulled the lever on the heavy wooden press to stamp the image–one page at a time. No wonder few colonial newspapers had a press run of more than 300.

The Life and Times of Silence Dogood

James Franklin wanted his publication, the New-England Courant, to be more than the usual collection of 6-month-old news that appeared in other colonial newspapers. So he solicited articles. In 1722, 14 letters appeared in the New-England Courant signed by “Silence Dogood.” The middle-aged widow had a lot to say about the clergy, fashion, and political matters, and people loved it–even if they didn’t know who the Widow Dogood really was.

Using a pen name was common at the time, so everyone knew “Dogood” wasn’t her real name. But no one knew that 16-year-old Ben had actually written the letters, sliding them under the printshop’s door at night.

A year after the Silence Dogood letters were published, Ben ran away from his brother’s employ. (Things got rough for James after he was thrown in jail for suggesting the local authorities were in cahoots with pirates.) Still in his teens, Ben apprenticed with a Philadelphia printer before sailing for London and working there for two years. By 1729, he was back in Philadelphia and publishing his own newspaper, the Pennsylvania Gazette.

All the News Ben Could Print

The Gazette was like most newspapers of its day–no headlines, few illustrations, and it ran only four pages. What set it apart was Franklin’s lively version of local news. He filled the columns with anecdotes like this one: “And sometime last Week, we are informed, that one Piles a Fidler, with his Wife, were overset in a Canoo near Newtown Creek. The good Man, ’tis said, prudently secur’d his Fiddle, and let his Wife go to the Bottom.” The Pennsylvania Gazette became one of the most successful newspapers of its time.

Colonial newspapers had no separate editorial pages, but they were packed with opinions. Just as he had done in his Silence Dogood days, Franklin often wrote an article in the voice of a fictional citizen. In 1735, he printed a letter purportedly written by an elderly gentleman, who encouraged his fellow Philadelphians to establish a volunteer fire department. The imaginary old man described leaping out the window of a burning house. By the end of the year, the Union Fire Company of Philadelphia had formed.

“Poor Richard” Makes Ben Wealthy

Franklin’s most successful editorial alter ego was “Poor Richard” Saunders, the pen name Franklin used for the 25 years he published Poor Richard’s Almanack. In the colonies, practically every printer published an annual almanac. These thick pamphlets, showing the phases of the moon and predicting the weather, were moneymakers because most literate households purchased one every year.

In 1732, Franklin threw together a 24-page publication with a first-person preface signed by Richard Saunders. The “author,” a destitute stargazer whose shrewish wife threatened to burn all his books and astronomy instruments if he didn’t “make some profitable use of them,” admitted the reason he wrote the almanac was to make a little money and get her off his back.

From 1732 to 1757, Poor Richard’s grew in popularity as readers found more than the usual astronomical charts and tidal tables. Tucked into this almanac were proverbs such as “Early to Bed, and early to rise, makes a Man healthy, wealthy and wise.” Franklin said he saw the almanac as a way to educate folks who might not buy any other books and so “filled all the little spaces that occurred between the Remarkable Days in the Calendar, with Proverbial Sentences, chiefly such as inculcated Industry and Frugality.”

Some years Franklin sold 10,000 copies. Combined with good investments and lucrative printing contracts, the profits from the almanac allowed him to retire from printing at the ripe old age of 42. Of course, Franklin’s “retirement” was more active than many a person’s working life. And though he was hailed as a scientist, diplomat, patriot, and philosopher, at the end of his days, Franklin was still proud of his printshop roots. When he wrote his will at the age of 82, he began: “I, Benjamin Franklin, printer, . . . “

Americana

Yesterday, while snooping around America’s Central Intelligence Agency (CIA), we noticed something important. Though the CIA gets more press, the National Security Agency (NSA) actually “employs more people and consumes more cash.” Several readers wrote in to ask if that could possibly be true. It is.

So why does the CIA get all the attention? Because that’s exactly the way the NSA likes it. For decades, the U.S. government didn’t even admit that the NSA existed. It did its work secretly, governed only by executive order. The joke for those in the know was that NSA stood for “No Such Agency.” Today, let’s snoop around this cryptic intelligence group.

Civilian vs. Military Intelligence

The NSA got its start in 1952, when President Harry Truman created it with a secret stroke of his executive pen. Congress had already created the CIA five years earlier, with the National Security Act of 1947. But the civilian CIA didn’t eliminate the various military intelligence services, nor did it focus on doing what the military services did best: intercepting and reading an enemy’s mail, overhearing its private conversations, and cracking its secret codes.

To consolidate the military’s intelligence gathering for the Cold War, the NSA put all the military’s eavesdroppers and codebreakers under one general or admiral, who reported directly to the Secretary of Defense. It’s been that way ever since. While the NSA employs tens of thousands of civilians–including more math PhDs than anyone else–it remains inside the Defense Department. It even has its own troops, in a special branch called the Central Security Service.

HUMINT vs. SIGINT

To avoid superfluous spying, the civilian CIA sticks to what spymasters call HUMINT, or human intelligence. When James Bond makes contact with a double agent inside enemy territory, or gives a bad guy the back of his hand, that’s HUMINT. The NSA’s bailiwick is SIGINT, or signals intelligence, and while it doesn’t sound nearly as glamorous, many think it’s far more powerful.

The NSA uses a worldwide web of state-of-the-art satellites, listening posts, and intercept stations to capture and record huge volumes of the world’s communications. It then runs these communications through some of the world’s most powerful computers, scanning for keywords or patterns that require an analyst’s attention. An unofficial agency motto: “In God we trust. All others we monitor.”

Domestic vs. Foreign SIGINT

Officially, the NSA performs its SIGINT sweeps only “against foreign powers or agents of foreign powers.” But that doesn’t mean the communications of U.S. citizens aren’t sucked into NSA computers. NSA officials point out that, in today’s world, there is no clear and easy distinction between domestic and foreign communications.

“The networks have collapsed into one another,” said one official, “and many of our targets are on the same network that we use. It is now just ‘the network’–the global telecommunications infrastructure.” So, when U.S. citizens do appear in NSA data, analysts withhold their names from intelligence reports. But the information remains in the files, and there are exceptions that allow for its release.

–Michael Himick

From New York Times, September 12, 2007

By Matt Richtel

Older people are sticky.

That is the latest view from Silicon Valley. Technology investors and entrepreneurs, long obsessed with connecting to teenagers and 20-somethings, are starting a host of new social networking sites aimed at baby boomers and graying computer users.

The sites have names like Eons, Rezoom, Multiply, Maya’s Mom, Boomj, and Boomertown. They look like Facebook — with wrinkles.

And they are seeking to capitalize on what investors say may be a profitable characteristic of older Internet users: they are less likely than youngsters to flit from one trendy site to the next.

“Teens are tire kickers — they hang around, cost you money and then leave,” said Paul Kedrosky, a venture capitalist and author of the blog “Infectious Greed.” Where Friendster was once the hot spot, Facebook and MySpace now draw the crowds of young people online.

“The older demographic has a bunch of interesting characteristics,” Mr. Kedrosky added, “not the least of which is that they hang around.”

This prospective and relative stickiness is helping drive a wave of new investment into boomer and older-oriented social networking sites that offer like-minded (and like-aged) individuals discussion and dating forums, photo-sharing, news and commentary, and chatter about diet, fitness and health care.

Last week, VantagePoint Ventures, an early investor in MySpace, announced that it had led a $16.5 million round of financing for Multiply, a social networking site aimed at people who are settled.

In August, Shasta Ventures led a $4.8 million financing round for TeeBeeDee, a site coming out of its test stage this month. The name is short for “To Be Determined” (as in: just because you’re not trolling for a mate on MySpace doesn’t mean your life is over.)

Also in August, Johnson & Johnson spent $10 million to $20 million to acquire Maya’s Mom, a social networking site for parents, according to a person briefed on the deal. The site has been in existence about a year.

Social networking has so far focused mainly on businesspeople and young people because they are tech-savvy and are treasured by Madison Avenue.

But there are 78 million boomers — roughly three times the number of teenagers — and most of them are Internet users who learned computer skills in the workplace. Indeed, the number of Internet users who are older than 55 is roughly the same as those who are aged 18 to 34, according to Nielsen/NetRatings, a market research firm.

TeeBeeDee’s founder is Robin Wolaner, who in 1987 created Parenting magazine. That year, at least seven magazines focused on being a parent were started, and Ms. Wolaner said she was seeing the same sudden recognition of a need for Internet publishers to respond to the demands of older Americans.

She came up with the idea for the site, she said, “when I was sitting around with friends and we said, ‘We’re not going to hang out at the AARP site. What is there for us?’ ” (Plus, she said, she wanted to find a community where she could discuss her interest in getting an eye lift).

“There’s a recognition that this generation now uses the Internet just like younger people,” she said. “The one thing this generation hasn’t done yet is network online.”

The question is whether they’ll want to network in large enough numbers to justify the tens of millions of dollars going into the space. Indeed, the interest from entrepreneurs and venture capitalists has led to a mini-boom in sites that cater to baby boomers, creating what they say is both critical mass and a likely falling out.

Some of the older users of the sites say the experience feels more comfortable to them than when they tried MySpace, Facebook or Friendster.

“I’ve discussed my divorce, my medical issues, and when do I dare go dating again,” said Martha Starks, 52, a retired optician in Tucson, who spends an hour or two each evening on a site called Eons. “I sure wouldn’t discuss that stuff with a 20-year-old.”

She says she talks about lighter things, too, like movies and music, with an audience that gets what she is saying.

“They don’t even know who Aretha is — she’s the queen of soul!” she said.

Meg Dunn, 38, who is raising three children in Fort Collins, Colo., said she had tried MySpace and Facebook but had found that the short attention span of users didn’t suit her either. She now uses Multiply, where she shares family photos with her relatives, and gets into discussions on substantive topics, like health issues and illnesses affecting elderly people.

“I feel like I’m putting down roots, building relationships,” she said. “My feeling on MySpace is that people give you a poke, and then they’re gone and you never see them again.”

Peter Pezaris, president and chief executive of Multiply.com Inc., based in Boca Raton, Fla., said he believed that older customers were stickier than younger ones, but said the evidence so far was anecdotal. He said 96 percent of the company’s active users returned each month, a statistic that he said impressed the venture capitalists who considered investing in the site.

David Carlick, a managing director with VantagePoint, which led the latest investment round in Multiply, said he believed that social networking sites in general had a bright business future as advertisers start to gravitate to them. He also said he believed that targeted sites, like those focused on an age demographic, could be particularly effective.

He said he had some concern that sites focusing on younger users could be vulnerable to the whims and caprice of fashion.

“That was on our minds when Murdoch came in with an offer,” he said of the decision to sell MySpace to the publishing tycoon Rupert Murdoch for around $550 million.

But venture capitalists and entrepreneurs have been slow to embrace the interests of older Internet users, said Susan Ayers Walker, a freelance technology journalist for AARP and founder of SmartSilvers Alliance, which offers consultant services to businesses looking to connect with older consumers.

She said that Silicon Valley investors have seen themselves as eternally youthful, and identified with ever-new gadgets. But they are starting to accept their age — and to invest in it.

“They’ve all got high blood pressure,” she said. “They’re starting to understand their age group — they’re living it.”

Peter Ziebelman, a partner at Palo Alto Venture Partners, joked that the interest in sites aimed at aging Americans represented the end of a state of denial for venture capitalists.

“Perhaps there aren’t many V.C.’s who want to be in the newspaper saying they’re backing the 5o-and-over population,” he said. “They’d rather say they’re attending the next keg party.”

(Mr. Ziebelman is an investor in www.agis.com, which is not a social networking site, but focuses on delivering information and services to people who need help with elder care.)

Ms. Ayers said that the investors are learning that social networks aimed at older users are a big draw for investors, consumer products and services companies. “Not only do we have a lot more money, we pay a lot more attention to advertisers,” she said.

The advertisers on Eons include Humana health care insurance, Fidelity Investments and the pharmacy chain CVS. Lee Goss, president and chief operating officer of Eons Inc., which received backing from the venture capital firms Sequoia Capital and General Catalyst, said that the sites aimed at an older audience may not grow as quickly as MySpace, but could have longevity.

“Our audience, while it is harder to attract, is more durable and sticky over time,” he said.