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Author Topic: Privacy legislation: time has come  (Read 2950 times)
isthisthingon
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« on: August 08, 2010, 12:41:28 PM »

http://www.pcworld.com/article/202862/privacy_legislation_time_has_come.html?tk=nl_dnx_h_crawl

Great article on privacy concerns that deals with the fallacy of self-regulation.
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If the Internet really wants to self regulate, content providers and advertisers need to make privacy brain-dead simple. The first time I log onto a Web site that tracks my surfing habits and/or location, show me a splash screen with five bullet points summarizing what information it's collecting what happens to it. Give me a link to a plain-English description of the site's privacy policies and the option to click "no thanks" right there.

Is that so friggin' difficult? Do we really need another ten years of discussion for this to happen?

In the libertarian world view, a company would come along and offer that kind of service. The handful of privacy services that have arisen in the past ten years have all failed, however. The reason? There's not enough profit in protecting privacy, and way too much money to be made by violating it.

I'm really not a fan of government regulation, but sometimes it's necessary for the wellbeing of everyone. You can't force people to care about their personal privacy enough to jump through hoops to protect it. But you can force companies to care about it. That's what laws are for.
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« Reply #1 on: August 08, 2010, 12:57:49 PM »

The article is comparing smoking,driving regulations, factory safety to "privacy regulation".
The big difference is that lack of privacy from cookie trackers does not physically kill or harm you.

So if there is gov't regulation we see how well it worked with banking regulation.
Gov't will have to set up all sorts of offices, all sorts of infrastructure, to fund this they will have an "internet tax".
Then the big companies will pay off the agency, and the only one who will have to follow the rules is small guys.

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isthisthingon
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« Reply #2 on: August 08, 2010, 06:01:02 PM »

So if there is gov't regulation we see how well it worked with banking regulation.

From the left and from the right, it's very much accepted that deregulation, not regulation, caused the bank crisis. 

Of course they still have some regulation, as does the Internet, but what we need is intelligent regulation  Smiley
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isthisthingon
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« Reply #3 on: August 08, 2010, 06:21:28 PM »

Additionally: http://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%932010

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Deregulation
Further information: Government policies and the subprime mortgage crisis

Critics have argued that the regulatory framework did not keep pace with financial innovation, such as the increasing importance of the shadow banking system, derivatives and off-balance sheet financing. In other cases, laws were changed or enforcement weakened in parts of the financial system. Key examples include:

    * Jimmy Carter's Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA) phased out a number of restrictions on banks' financial practices, broadened their lending powers, and raised the deposit insurance limit from $40,000 to $100,000 (raising the problem of moral hazard).[61] Banks rushed into real estate lending, speculative lending, and other ventures just as the economy soured.
    * In October 1982, U.S. President Ronald Reagan signed into Law the Garn–St. Germain Depository Institutions Act, which provided for adjustable-rate mortgage loans, began the process of banking deregulation,[citation needed] and contributed to the savings and loan crisis of the late 1980s/early 1990s.[62]
    * In November 1999, U.S. President Bill Clinton signed into Law the Gramm-Leach-Bliley Act, which repealed part of the Glass-Steagall Act of 1933. This repeal has been criticized for reducing the separation between commercial banks (which traditionally had a conservative culture) and investment banks (which had a more risk-taking culture).[63][64]
    * In 2004, the U.S. Securities and Exchange Commission relaxed the net capital rule, which enabled investment banks to substantially increase the level of debt they were taking on, fueling the growth in mortgage-backed securities supporting subprime mortgages. The SEC has conceded that self-regulation of investment banks contributed to the crisis.[65][66]
    * Financial institutions in the shadow banking system are not subject to the same regulation as depository banks, allowing them to assume additional debt obligations relative to their financial cushion or capital base.[67] This was the case despite the Long-Term Capital Management debacle in 1998, where a highly-leveraged shadow institution failed with systemic implications.
    * Regulators and accounting standard-setters allowed depository banks such as Citigroup to move significant amounts of assets and liabilities off-balance sheet into complex legal entities called structured investment vehicles, masking the weakness of the capital base of the firm or degree of leverage or risk taken. One news agency estimated that the top four U.S. banks will have to return between $500 billion and $1 trillion to their balance sheets during 2009.[68] This increased uncertainty during the crisis regarding the financial position of the major banks.[69] Off-balance sheet entities were also used by Enron as part of the scandal that brought down that company in 2001.[70]
    * As early as 1997, Federal Reserve Chairman Alan Greenspan fought to keep the derivatives market unregulated.[71] With the advice of the President's Working Group on Financial Markets,[72] the U.S. Congress and President allowed the self-regulation of the over-the-counter derivatives market when they enacted the Commodity Futures Modernization Act of 2000. Derivatives such as credit default swaps (CDS) can be used to hedge or speculate against particular credit risks. The volume of CDS outstanding increased 100-fold from 1998 to 2008, with estimates of the debt covered by CDS contracts, as of November 2008, ranging from US$33 to $47 trillion. Total over-the-counter (OTC) derivative notional value rose to $683 trillion by June 2008.[73] Warren Buffett famously referred to derivatives as "financial weapons of mass destruction" in early 2003.[74][75]

So in a sense, we were responsible for bailing out the system which we failed to regulate properly. 
« Last Edit: August 08, 2010, 06:33:31 PM by isthisthingon » Logged

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« Reply #4 on: August 08, 2010, 08:39:19 PM »

It is slightly more complex then that.
In a nutshell the banks created morgaged backed bonds.
But for them to get A rating so they could sell them easier they divided them into tranches.
http://en.wikipedia.org/wiki/Tranche
The lowest level tranches where hardest to sell, so the took the lowest level tranche of each series they could not sell.
Combined it together again and repeated.

But the big banks knew that they where backed by US govt etc.
So basically if u knew that the rules of the game are tails u win, heads the gov't bails you out .......
Well it is a win win game.

In PH the bank will not lend more then 60% of appraised value on a property.
These are rules the bank set. Not federal rules.

So you could argue that gov't meddling caused the mess.
What generally speaking happens gov't agency is set up for a good purpose.
Then big business corrupts it, and the gov't agency becomes welfare for the rich and powerful.
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isthisthingon
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« Reply #5 on: August 08, 2010, 10:12:20 PM »

But the big banks knew that they where backed by US govt etc.
So basically if u knew that the rules of the game are tails u win, heads the gov't bails you out .......
Well it is a win win game.

That's true, and having FDIC insurance is a form of regulation in itself.  But they realize that changes are and have been necessary:

"Today represents a significant milestone in the history of financial regulation in the United States. With the Dodd-Frank Wall Street Reform and Consumer Protection Act signed into law, a meaningful framework is now in place that addresses many of the weaknesses in our financial system that led to the financial crisis.”

Of course, you need to be cautious with any form of regulation since abuse is a huge problem.  But we don't need a return to the gilded age to remember what happens when we fail to maintain a sensible regulatory framework such that business can thrive without becoming a ponzi scheme for the fortunate few  Police

Currency itself is extremely regulated.  And once you bring referees into the ballgame you'd better call foul on all players - not just one Wink 
« Last Edit: August 08, 2010, 10:15:00 PM by isthisthingon » Logged

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« Reply #6 on: August 09, 2010, 01:50:05 PM »

Currency itself is extremely regulated.  And once you bring referees into the ballgame you'd better call foul on all players - not just one Wink 
You just want to wind me up and get me started  ROFLMAO
Modern currency is the biggest scam in the book.

With the US since under the Bretton Woods scam, USA was made the reserve currency and was on a gold standard of sorts.
But then in 1970 under pressure from Banks the gold standard was yanked. Mainly because there where more $$$ then gold.
That the US currency is the reserve currency is the only thing that is stopping the dollar from dropping like the mexican peso.
Of course China the emerging economic powerhouse is pissed that US is the reserve currency, mainly because they think it is wrong for US to screw the world and they would rather they screw the world. Maybe yellow dick is better then white dick  ROFLMAO

By adjusting the amount of $$$ gov't can create hidden increased taxes on the poor.
Tax brackets are on levels. Create inflation, so the person's income appears to increase. But all that happens is he ends up paying a greater percentage of his income to taxes.

Since all currencies are fiat, heya what would get me sent to jail is perfectly legal for gov't. Short of $$$ just go into the little room in the back and crank out a few more trillion.

Of course, you need to be cautious with any form of regulation since abuse is a huge problem.  But we don't need a return to the gilded age to remember what happens when we fail to maintain a sensible regulatory framework such that business can thrive without becoming a ponzi scheme for the fortunate few  Police
I presume you are talking about the gilded age of the 1990s when the Subprime mortgage crisis was started, and which is the biggest ponzi scheme the world has ever know Smiley. The figures keep on getting bigger and bigger of how much the gov't bailout is. The percentage of GDP is mind blowing. It makes the south sea bubble look like something invented by an bumbling amature con artist.
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« Reply #7 on: August 09, 2010, 02:56:36 PM »

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Modern currency is the biggest scam in the book.

Touché  ROFLMAO

I realize you were kidding about the gilded age, but here's more food for thought (from: http://www.apstudynotes.org/us-history/topics/gilded-age-scandal-and-corruption/)

Quote
In the decades between the end of the Civil War and the turn of the twentieth century, new technologies, cheap immigrant labor, maturing methods of industrialization, and a mechanized, streamlined transportation system of railroads and steam-powered ships proved a formula for astoundingly rapid growth in the business sector. Government, however, could not keep pace with these changes. Governments were naïve about business and the ways that individuals and companies made money, both legally and illegally. They were not able to deal with many cutthroat business practices, so these were allowed to continue. Competition was intense and business managers often had to adopt practices they disliked or be forced out of business.

America was founded on a philosophy of “hands off” of business, an approach known as “laissez-faire,” which is French for “leave to do.” Even when it became clear that some regulation was necessary, especially of credit and corporate practices, government did not know where or how to apply controls. Americans disliked many of the abuses they saw in business, but were reluctant to advocate government interference for fear of doing anything to cool the remarkable engines of progress and production.

...

Another unscrupulous practice sometimes employed was to have a company form another company with the same board of directors running both companies. This duplicated board was called an interlocking directorate. Again, in itself this was not bad unless the intent of the directors was to build both companies, transfer all the benefits to one company and bankrupt the other, again at the expense of the stock and bondholders. This practice was so blatantly harmful that the government had to step in to outlaw it.

The worst scandal involving an interlocking directorate occurred when the American government decided to underwrite a transcontinental railroad. The western half was built by the Union Pacific Railroad Company with substantial federal subsidies. The Union Pacific directors created a company called Crédit Mobilier that was to supply materials and labor. Though they were also the directors of Crédit Mobilier, they kept their involvement with that company quiet.

The Union Pacific built its half of the transcontinental railroad, but within a few years of operating the railroad, the company was bankrupt in spite of heavy infusions of government money. A New York newspaper exposed the scandalous co-ownership of the companies in 1872, and charges were confirmed by congressional investigation. Crédit Mobilier tried to divert attention by giving congressmen shares of its valuable stock that paid dividends of as much as 348%. Two congressmen and Grant’s Vice President were censured for accepting these bribes.

Investigators discovered that Union Pacific paid Crédit Mobilier hugely inflated prices for all its services and materials. In this way the directors transferred the assets of the railroad to the supply company. The losers were not only the thousands of Union Pacific shareholders who had invested millions in the railroad and lost their money, but also the American public that had supported Union Pacific through tax dollars. The Crédit Mobilier scandal broke during Grant’s presidency, tarnishing his reputation even though most of the corruption occurred during previous administrations.

So a question for you.  Would you recommend preventing the practice of having the same people on the boards of two "competing" companies where at any given time they can cannibalize one for the easy profits of the other?  Even without government subsidy involved, the money provided by the public in a publicly traded company can be completely abused without some regulation in place, no? 

Or since even money is a scam, which is true in many ways, then are you of the mindset that the fewer regulations there are, the better everyone will be?  In any case, I guess I have little faith in self-regulating markets since there's a historical record in the US of relaxed regulations resulting in widespread corruption, financial crises and subsequent recessions/depressions.  Then we remember the lessons, again, and patch up our sinking ship that we assumed would fix itself.  I'm certainly no economist, but the challenges seem far greater than simply removing all regulation or simply adding more.  And yes, the gold standard was an anchor we no longer have yet with globalization we can all hold each other hostage, as it were, because a complete failure of any of the major players will have a catastrophic domino effect on all the others 
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« Reply #8 on: August 09, 2010, 03:48:10 PM »

Touché  ROFLMAO

I realize you were kidding about the gilded age, but here's more food for thought (from: http://www.apstudynotes.org/us-history/topics/gilded-age-scandal-and-corruption/)
http://en.wikipedia.org/wiki/Bre-X
The salting of crushed core samples with placer or supergene gold constitutes the most elaborate fraud in the history of mining. In 1997, Bre-X collapsed and its shares became worthless in one of the biggest stock scandals in Canadian history, and the biggest mining scandal of all time.

Quote
In any case, I guess I have little faith in self-regulating markets since there's a historical record in the US of relaxed regulations resulting in widespread corruption, financial crises and subsequent recessions/depressions.  Then we remember the lessons, again, and patch up our sinking ship that we assumed would fix itself.  I'm certainly no economist, but the challenges seem far greater than simply removing all regulation or simply adding more.  And yes, the gold standard was an anchor we no longer have yet with globalization we can all hold each other hostage, as it were, because a complete failure of any of the major players will have a catastrophic domino effect on all the others
I have little faith in anything  ROFLMAO
The so called "fixing" is working very well with the current recession/depression. The pesky middle class in USA is being eliminated.

There was an article on reddit about how the origional Animal Farm had its preface removed.
Animal Farm was not anti-communist, it was anti-system. In the end the pigs sold out and became humans Smiley



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« Reply #9 on: August 09, 2010, 04:13:05 PM »

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The pesky middle class in USA is being eliminated.

Yes it is, though I think our opinions differ as to why this is the case.  But it's hard to deny that this dissolving of the middle class comes right alongside the dissolving of regulations in general - at the very least in an undeniable parallel of timing.  In any case, it's pretty logical to conclude at least some level of cause and effect with regards to a lack of regulation leading up to one crisis or another.

IMO, deregulation is a chief contributor to gradually eroding the foundation that supported the middle class.  Historically, during times of the lowest levels of regulation (the gilded age being one of them) you see predictably the lowest levels of middle class as well.  This is why I believe that a completely unregulated free market is a threat to the middle class.  Again, I'm no economist Smiley  But I'm sure it's easy to see why some believe that intelligent regulation is better than none.  I'm certainly one of them 
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« Reply #10 on: August 09, 2010, 08:13:38 PM »

Yes it is, though I think our opinions differ as to why this is the case.  But it's hard to deny that this dissolving of the middle class comes right alongside the dissolving of regulations in general - at the very least in an undeniable parallel of timing.  In any case, it's pretty logical to conclude at least some level of cause and effect with regards to a lack of regulation leading up to one crisis or another.
Regulation without teeth is useless.
My 2 cents is that labor unions in the past where responsible for getting proper regulation passed and ensuring it was enforced.
But the labor unions where destroyed by propaganda, thier own ineptitude etc.
The great peace is always when there are 2 great powers that balance each other out.

The http://en.wikipedia.org/wiki/Battle_of_Agincourt marked the end of the feudal system in Europe.
In the hands of the common man was a method which could be used to take down the most powerful knight.


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« Reply #11 on: August 09, 2010, 11:06:34 PM »

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The great peace is always when there are 2 great powers that balance each other out.

 Ditto 

And barring the fears of global nuclear destruction and the senseless spending on an arms race worth little more than winning a pissing contest, and otherwise in all seriousness, having the Soviet Union to balance out the US was a good thing in many ways 
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