GIOVANNI BIRINDELLI, 26.11.2019
(Italian version here)
While reading Edward Snowden’s Permanent Record, I was astonished by the qualities of the author. Notwithstanding his understatement, these qualities clearly emerged from the details of his story: his courage, above all. His intelligence. His computing abilities, which to me seem almost supernatural. His rectitude. His profound kindness that is revealed in every line of his book. His great humaneness.
While each one of these qualities in itself would have already been extraordinary because of its intensity, the contemporary presence of all of them in the same person at the same time made me rethink the limits of what I once considered to be humanly possible.
In this article I will not discuss these qualities. I think that the best way to appreciate them is to buy the book and read it.
I’m so much humbled by them and by Snowden’s purely heroic gesture that I’m instinctively inclined to censor my own criticism of some aspects of his thought that I believe are logically inconsistent. In fact, in relation to the choices, the capabilities, the actions and the qualities of a hero of this magnitude, these inconsistencies have such little importance that they appear to be almost negligible. However, they are about the very ideas on which his gesture was based: namely, the very concept of privacy and the difference between what is legal and what is right. Therefore, perhaps a discussion of these inconsistencies may be not entirely useless. In addition, I do not believe that self-censorship would be the best way to homage the person who, at the beginning all alone, has defied the most powerful nation in the world (and its allies) to denounce its mass surveillance programs and start a debate on these issues.
Criticizing from the comfort of one’s desk, on a theoretical level, the ideas of someone who risked his own life to defend them (and who’s living in exile for having defended them), is not usually an aesthetically beautiful thing to do, I believe. However, in this particular case, I consider this criticism a tribute to the man who has risked his own life to start a much-needed debate on privacy and on the difference between what is legal and what is right. This criticism is for me a way to acknowledge the debt that I, together with my family, have with Edward Snowden and that I know I will hardly ever manage to pay back.
1. What is privacy?
Snowden writes: «The word “privacy” itself is somewhat empty, because it is essentially indefinable, or over-definable. Each of us has our own idea of what it is» (p. 208).
I don’t think this is true.
Of course, because every individual is different from another, he will have different preferences and needs is relation to privacy. John may choose to send Claire a postcard while Paul may prefer sending her a letter in a sealed envelope.
However, this subjective nature of preferences and needs in relation to privacy does not mean that privacy cannot be objectively defined. Claiming that it cannot be defined because each individual has his own idea of what privacy is and/or because he has his own individual needs in relation to privacy, is not different, mutatis mutandis, from claiming that the economic law of demand cannot be defined because when different individuals dinner out at a restaurant they order different things from the menu. Of course they do. However, this does not alter in the least the fact none of these individuals would order more dishes or would go to that restaurant more often if, other things being equal, its prices were higher (economic law of demand).
In the fact that each person has her own idea of what privacy is and/or has her own individual preferences/needs in relation to privacy, there is nothing that can lead us to conclude that privacy cannot be objectively defined.
In fact, I believe that a person’s privacy can be defined as her ability to exercise her property rights by excluding other people from the knowledge of this exercise (or of some of its aspects); and by excluding them in such a way that they cannot acquire this knowledge without violating her property rights.
Privacy is therefore, as the name itself suggests, an aspect of private property.
This fact is recognized by Snowden himself when he rightly claims that «Ultimately, the privacy of our data depends on the ownership of our data » (p. 194).
2. Privacy, property and liberty (1)
The fact that privacy is an aspect of private property has systemic logical implications that go far beyond privacy and are directly relevant for the concept of liberty.
Snowden sees a link between privacy and liberty. However, the link that he suggests has some problems.
Snowden writes: «The freedom of a country can only be measured by its respect for the rights of its citizens, and it’s my conviction that these rights are in fact limitations of state power that define exactly where and when a government may not infringe into that domain of personal or individual freedoms that during the American Revolution was called “liberty” and during the Internet Revolution is called “privacy” » (pp. 6-7).
To start, this is a circular reasoning because it defines “freedom” in terms of “liberty” (apart from very particular linguistic subtleties, which anyway are not addressed here, the two terms are interchangeable). Therefore, this reasoning does not say much.
In addition, Snowden seems to be doing an equivalence between liberty (which he did not define) and privacy (which he wrongly thinks is undefinable). Such equivalence is incorrect because, as we’ll see later, once privacy and liberty are defined in a logical sense, one discovers that privacy is only one aspect of freedom.
This equivalence makes Snowden consider other aspects of freedom (namely economic property rights) somehow less inviolable than the right to privacy or, more in general, to “civil liberties”. These, as we shall see, are natural rights only because they are property rights. The very use of the term “freedoms” (plural) suggests an approach to liberty which is not scientific but political.
Last but not least, while on the one hand Snowden in this passage refers to the limitations of state power, on the other hand he does not consider the logical fact that no coercive power can be limited in a non-arbitrary way (and therefore limited tout court) when it is founded on an arbitrary idea of equality before the law. And the very existence of state privileges (and therefore the very existence of the state itself) presupposes an arbitrary idea of equality before the law: an idea of ‘equality before the law’ which is political and not logical (or scientific).
Equality before the law intended in a logical sense simply means that the same (non-arbitrary) rules apply to all, without exception, in the same way. This is the only abstract idea of equality before the law that, to the extent it is recognized and respected, limits the coercive power of anyone over anyone else.
Vice-versa, we have equality before the law intended in a political (arbitrary) sense when an authority forms different categories of individuals on the ground of specific criteria (e.g. race, wealth, chaste, ecc.) and then applies the same rules to individuals or organizations (including its own) it has grouped into the same category, but it applies different rules to individuals and organizations it has grouped into different categories. This is the abstract idea of ‘equality before the law’ that the state needs to have its privileges, and therefore to exist.
If a private individual did what the government does when it taxes, for example, he would be charged with extortion. If he did what the central bank does when it creates legal-tender fiat money out of thin air and thus artificially reduces its purchasing power to the benefit of the greatest debtor of all (the state itself, which by legally forbidding the free market in the money sector forces people to use its own money), would be charged with different serious crimes.
This political idea of ‘equality before the law’ is compatible with arbitrary limitations of state power. However, an arbitrary limitation of state power is just another way to say that that state power is unlimited.
Snowden mentions the problem of equality before the law and its connection to liberty. However, again, he does it in a logically inconsistent way. He writes: «democracy is the one form of governance that most fully enables people of different backgrounds to live together, equal before the law» (p. 207). The legality of state privileges by itself logically implies an abstract idea of ‘equality before the law’ that is arbitrary. And these privileges (starting from taxation) characterize a democratic state as much as any other kind of state. Liberty is not a matter of governance, but of absence of it.
In the introduction, Snowden rightly observes that «The attempts by elected officials to delegitimize journalism have been aided and abetted by a full-on assault on the principle of truth. What is real is being purposefully conflated with what is false» (p. 7). What distinguishes what is true from what is false is an objective factor. In the case of empirical reality (i.e. to what can be journalistically documented), which Snowden refers to in this passage, such objective factor are facts. Truth, however, does not concern only empirical reality but also abstract concepts. And in the case of abstract concepts such objective factor is logic. The claim that racial ‘laws’ did not violate the principle of equality before the law is not less objectively false than the claim that the NSA did not create a permanent record of nearly all communications between individuals, including American citizens.
When equality before the law is intended in a political sense rather than in a logical sense, claiming that there can be limitations of state power is therefore a violation of what Snowden rightly calls the «principle of truth».
3. Privacy, property and liberty (2)
The logical relation between privacy and liberty does exist, but it isn’t the one described by Snowden.
Because privacy is an aspect of private property, its violation is a form of aggression.
Now, the non-aggression principle (NAP) is the only rule of just conduct (i.e. the only rule of conduct whose violation justifies the use of physical coercion) that is compatible with the principle of equality before the law intended in a logical sense. In other words, it’s the only law which is scientific, i.e. which: is non-arbitrary; is valid for everyone, every time, everywhere, without exception; is valid independently from the consequences that its respect (or lack thereof) produces; exists independently from whether it is defended or not, whether it is recognized or not, and by how many people. As such, the NAP is objectively and universally valid. In this specific sense, it is a natural law. Different people may have different ideas about the essence of human nature: about what is natural for man and what isn’t. However, the NAP’s absolute and exclusive compatibility with the principle of equality before the law intended in a logical sense does not depend on anyone’s opinion, least of all on the opinion of whatever majority.
Liberty is nothing less than the rule of law intended in a scientific (non-arbitrary) sense: that is, the rule of the non-aggression principle. As such, liberty is incompatible with the rule of men; including, of course, the rule of whatever majority or of the “people”. When the law is made or decided by men, and as such is arbitrary, the “rule of law” is nothing else than absolutism.
Snowden is therefore wrong, I believe, when he writes that «In an authoritarian state, rights derive from the state and are granted to the people. In a free state, rights derive from the people and are granted to the state» (p. 206). First of all, given that the NAP is a natural law, even though it can be discovered by the people (usually through a spontaneous process of cultural selection of the strongest rules: i.e. of the rules which prove to be more capable than others to reduce conflict and foster prosperity), it cannot derive from the people, but only from logic. Even if 100% of people were in favour of legalizing rape this wouldn’t have even the slightest effect on the illegitimacy of this action. Secondly, I have never granted the state the right to tax me, for example. Most importantly, even if I had wanted to grant such “right” to the state, I couldn’t have done it. In fact, there’s no such “right” as to take other people’s property by force. In fact, such “right” would violate the natural law, i.e. the NAP.
Elsewhere in his book Snowden seems to agree with the idea of natural rights: «[After my gesture] For the first time since the end of World War II, liberal democratic governments throughout the world were discussing privacy as the natural, inborn right of every man, woman, and child. In doing so they were harking back to the 1948 UN Universal Declaration of Human Rights, whose article 12 states: “No one shall be subjected to arbitrary interference with his privacy, family, home or correspondence … Everyone has the right to the protection of the law against such interference or attacks» (p. 330, emphasis mine).
However, the right to privacy (which does not derive from a UN Universal Declaration but from logic) is natural only because, being privacy an aspect of private property, the right to privacy is an aspect of the NAP. And it is the NAP that is a natural law. In fact, as we have seen, the NAP is a natural law because it is the only possible rule of just conduct which is absolutely compatible with the principle of equality before the law intended in a logical sense, without exceptions. There cannot exist any natural right to privacy or any “civil liberty” separately from the NAP. Privacy is a natural right only because private property (whatever its form) is a natural right. And private property as natural right implies the illegitimacy of all those privileges (starting from taxation) which are the presupposition of every state (weather it is democratic or not). The existence of the UN itself, being funded by taxation, implies the violation of the same natural right that article 12 defends in one of its aspects. The very concept of natural right has some implications on state action in and of itself. However, while on the one hand Snowden seems to support the idea that individuals have a natural right to privacy, on the other he does not question state action as such, but only some of its “degenerations”.
However, not only is privacy, as we have seen, an aspect of private property but also, on a practical level, privacy and property (and specifically economic property) are linked. In fact, on the one hand, the legal violation of privacy demands the legal violation of property (the NSA is financed through taxation). On the other hand, the legal violation of property often leads to the legal violation of privacy. In Italy, for example, in order to violate more easily the private property of individuals and businesses through taxation, the right to privacy has been simply, totally and officially abolished in this field.
4. What is legal and what is right, the state, and democracy
Snowden said that «what is legal is not always what is right». This is very true. However, the difference between what is legal and what is right can make sense only to the extent that the meaning of “what is right” is not arbitrary. Otherwise, one could ask: «and who are you to establish what is right?».
Let’s use the word legality to describe the obedience to authority’s arbitrary commands (or positive ‘laws’). Vice-versa, let’s use the phrase “what is right” (or the word legitimacy) to describe the respect of the law intended in a scientific sense (the NAP). In this case, the distinction between what is legal and what is right is not arbitrary and makes sense. However, an implication of this is that such distinction has a non-arbitrary meaning only if the state (including of course the democratic state) is considered in and of itself to be illegitimate.
Snowden seems to identify democracy with the rule of law, and authoritarianism with the rule of a leader (p. 207). In doing so, however, he seems to make a confusion between democracy and liberty. If the “law” is a decision of an authority (e.g. of a representative majority), then the “rule of law” is an expression of the “rule of men” (even if that decision-making process is subject to “checks and balances”). Vice-versa, if the “law” is the natural right, then democracy, being the rule of the majority, is opposite to the rule of law. Because he uses the concept of natural law in an arbitrarily selective way, Snowden seems unable to see that democracy and liberty not only are two different concepts but opposite ones, as the rule of men and the rule of law are.
5. Reality, imperfection, direction
A perfectly free society has never existed and never will. Unfortunately, the state is here to stay (which neither means that it is necessary nor that there are no ways to go around it, especially technological ways: see later). Liberty is not a realistic possibility, not only in the short term but also in the long run. The systematic and, what is worse, legal violation of liberty by the state is an aspect of reality we and our children must continue to live with.
However, this does not imply that we must distort the scientific idea of liberty in favour of one which, being logically inconsistent, is better suited to a reality in which there is the state, and there will continue being for the foreseeable future. Not only would this be theoretically wrong, but also counterproductive from a strictly practical point of view.
In fact, even though a scientific idea of liberty cannot by itself produce a perfectly free society, in the long run it can contribute to create a progressive and continuous movement in that direction (i.e. in the direction opposite to the one the modern state is moving today, also in the West). Actually, this movement can happen only if the generally accepted idea of law is the scientific, logically consistent one. It is not because the Northern Star can never be reached that it can stop pointing to the North. And if rough see prevents you from sailing in the North direction, this is not a good reason to say that the North star does not point to the North. If you say so, you simply loose your bearings.
For example, if taxation was explicitly considered to be equal to plunder even by those who are responsible for it, it will probably continue to exist but there would be a possibility that it would be progressively reduced in the long run and therefore that liberty would be less violated in time. Or at least that the growth-rate of its legal violation would diminish. Vice-versa, if taxation is absurdly considered not only necessary but even legitimate, there will necessarily be ever more.
In other words, the practical importance of the scientific idea of liberty does not lie in its power to produce a situation of perfect freedom (it does not have this power) but in its power to produce a sustainable movement in its direction. A generally recognized scientific idea of liberty will produce a movement towards perfect liberty, without ever reaching it. Vice-versa, a generally recognized anti-scientific idea of liberty (i.e. one which is arbitrary, or arbitrarily selective, or logically inconsistent), will produce, as it is producing, a movement in the opposite direction. Using a slogan, in relation to liberty, from a practical point of view, one can say that movement is everything and the particular situation is nothing.
6. Technology and bitcoin
Above all, the scientific idea of liberty can inspire (it is already inspiring) a new generation of individuals who have extraordinary technical skills and creativity. These individuals are developing new technological tools (open-source, decentralized and censorship resistant) to protect more and more aspects of our life from government interference. In a very beautiful passage of his book, Snowden writes: «In a perfect world, which is to say in a world that doesn’t exist, just laws would make these tools obsolete. But in the only world we have, they have never been more necessary. A change in the law is infinitely more difficult to achieve than a change in a technological standard, and as long as legal innovation lags behind technological innovation institutions will seek to abuse that disparity in the furtherance of their interests. It falls to independent, open-source hardware and software developers to close that gap by providing the vital civil liberties protections that the law may be unable, or unwilling, to guarantee. In my current situation, I’m constantly reminded of the fact that the law is country-specific, whereas technology is not. Every nation has its own legal code but the same computer code. Technology crosses borders and carries almost every passport. As the years go by, it has become increasingly apparent to me that legislatively reforming the surveillance regime of the country of my birth won’t necessarily help a journalist or dissident in the country of my exile, but an encrypted smartphone might» (p. 329).
In this passage Snowden seems to refer only to the technology that today allows individuals to protect their privacy from government attacks. However, in 2009 bitcoin was invented: a technology which, even thought is still wanting in terms of privacy (but it is improving also in this respect), is proving extraordinarily effective in protecting economic property (and thus a different aspect of liberty) from state aggression.
Strangely enough, in his book Snowden does not mention bitcoin even once (though, if I’m not mistaken, he showed his support for zCash, an altcoin, in the past). On the one hand, this sounds strange because today bitcoin is perhaps the most important example of the “tecnological liberation” he refers to in this beautiful passage of his book. On the other hand, however, given that in the rest of the book Snowden seems to identify liberty with “civil liberties” (in other words, given that he does not seem to consider economic property on an equal foot with “civil liberties”, themselves a property right), then one should not be surprised that when he writes about technology and independent developers he does not mention bitcoin.
7. 2008 and those who “profited from the pain”
Bitcoin was created right after (and somehow in direct response to) the 2008 financial and economic crisis, which unlike bitcoin Snowden discusses in his book. In discussing it, Snowden seems to make a U-turn in relation to privacy. In particular, if I’m not mistaken, he seems to be taking position against privacy when this is relative to the economic aspects of property. In particular, he seems to criticize the Swiss banks because they guaranteed a good level of privacy also to their foreign customers, and he seems to criticize the latter because they took advantage of this privacy: «while the Swiss banks didn’t engage in many of the types of risky trades that caused the crash, they gladly hid the money of those who’d profited from the pain and were never held accountable. The 2008 crisis, which laid so much of the foundation for the crises of populism that a decade later would sweep across Europe and America, helped me realize that something that is devastating for the public can be, and often is, beneficial to the elites» (p. 161).
First of all, what is the crime in engaging in risky trades? Rather, isn’t it a crime to use taxation/inflation/public debt to save those who engaged in such trades and failed? Would they have engaged in such risky trades if they had known that no one could have come to save them with other people’s money and/or with legal-tender money created out of thin air from a monopolistic institution? Would they have engaged in such trades in a situation of liberty (and thus also of free market in the money sector)?
Above all, what is the crime in profiting from a crisis produced by others, and specifically by the state and the central bank? It is not unreasonable to assume that, during the next crisis, the price of bitcoin will increase significantly. Are those who invested in bitcoin bad guys because they profited from the crisis?
It is important to remember that the 2008 crisis, as much as all the cyclical crises that preceded it and those that will follow it, was (and still is) the result of artificial expansion of money and credit by the central bank. Such expansion was (and still is) made possible by the privileges that the state granted the central bank. In other words, it is made possible by the systematic violation of freedom in the money and banking sector by the state and the central bank. It was in response to these privileges that bitcoin was invented.
The reasons why the 2008 crisis was produced by such artificial expansion of money and credit (and thus by the state) are explained in any text dealing with the Austrian School of economics and the Business Cycle. In a nutshell and very much superficially, these reasons can be summed up as follows.
The interest rate is the price of time preference. Higher time preferences (i.e. higher consumption and thus lower savings) mean less economic resources available for investments (resources which, in absence of manipulation of money and credit, can come only through savings). Therefore, they mean that investors will have to pay a higher price to adjudicate these resources (the free market interest rate). The free market interest rate is therefore the price of time preference; the “compass” that coordinates savings and investments in time.
Now, artificial expansion of money and credit by the central bank (and by the fractional-reserve banking based on it) produces artificially low interest rates. That is, interest rates which are low not because people save more (i.e. because they have lower time preferences than before: which would produce a sustainable structural growth) but following an arbitrary and coercive command of an authority (the central bank): a command that the central bank can give because the state defends at gun-point its legal monopoly in the money sector.
These artificially low interest rates convey to the market the information that there are plenty of resources available for investments. However, these resources do not exist. On the grounds of this false information and of the distortion of relative prices that it produces, the economic agents will be incentivized to engage in ambitious, long term projects which are not economically sustainable. In other words, to make all together the same mistake at the same time. This false information conveyed by the artificially low interest rate thus distorts the productive structure by orienting it towards an economically unsustainable path.
At the beginning, there will be an economic expansion (boom). However, when the fact the economic resources needed to complete the projects started are simply inexistent becomes evident (and it can become evident in various ways, e.g. via upward pressures on the interest rates), the house of cards falls down and the crisis starts (bust).
The 2008 crisis, like all cyclical crises that preceded it and those that will follow it, was then produced by artificial expansion of money and credit by the central bank and by the fractional-reserve banking based on it. In other words, by the state that granted the central bank and the banking system specific privileges.
Now, while Snowden does discuss the 2008 crisis, there’s no mention of the fact that it was the central bank (and thus the state) that produced it. On the contrary, he gives the impression that the crisis was the result of reckless and greedy investments by an “elite” (the bad Wall Street guys?). More specifically, he suggests that there is an opposition of interests between the “elites” and the “public”. This claim is logically false, and very dangerous, especially for the economically weakest ones.
There is no opposition between the interests of the “elites” and those of the public, as Snowden suggests. The only actual opposition is between those who obtain resources in a political way, that is in a coercive way (the state-central bank system) and those who obtain them peacefully through free exchange (the free market). Until this scientific fact will be generally recognized, much energy and resources will continue being wasted in the destruction of wealth rather than in its creation.
Fortunately, Snowden did not express in his book ideas which are similar to those expressed in this article. Fortunately, in his defence of privacy and of what is right against what is legal, he was inconsistent.
The phrase “the world needs…” in one that, as a rule, I never use. The world is made of individuals and economic science is founded precisely on the fact that no one except, to some extent, the individual himself can know what, in every different moment, he needs. This is a large part of what Friedrich A. von Hayek meant by writing that «The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design». However, if one day I had to make an exception to this general rule, it would be in Snowden’s case. In fact, even though in so doing I’m making a scientific mistake, I’m inclined to think that the world needs Edward Snowden. It needs his courage. His integrity. His intelligence. His capabilities. On the other hand, Snowden today needs the so-called “public opinion”. And today, speaking in favour of liberty with a scientific approach is the fastest way and the most effective one to have the entire “public opinion” against you.
 By “aggression” I mean an initial violation of private property by means of physical violence, physical coercion, threat thereof, intrusion, fraud, violation of a voluntary contract, failure to refund the damaged party after faulty action.