Edward Snowden and the Political West

Germany is the theatre in which the consequences of Edward Snowden’s disclosures are being played out. Why is this?

Obviously, privacy and data protection are especially sensitive in Germany. After the Stasi, the centrality of big databases to the West German state’s response to the left-wing terrorists of the 1970s, and the extensive Nazi use of telephone intercepts during the seizure of power, it couldn’t really be otherwise. Privacy and digital activism is older and better established in Germany than anywhere else – in the US, for example, I consider the founding text of the movement to be the FBI vs. Steve Jackson Games case from 1990 or thereabouts, while the key text in Germany is the court judgment on the national census from ten years earlier. But the UK has a (strong) data protection act and no-one seems anywhere near as exercised, although they probably should be.

So here’s an important German word, which we could well import into English: Deutungshoheit. This translates literally as “interpretative superiority” and is analogous to “air superiority”. Deutungshoheit is what politicians and their spin doctors attempt to win by putting forward their interpretations and framings of the semirandom events that constitute the “news”. In this case, the key event was Snowden’s disclosure of the BOUNDLESS INFORMANT slides, which show that the NSA’s Internet surveillance operations collect large amounts of information from sources in Germany.

The slides don’t say anything about how, whether this was information on German customers handed over by US cloud companies under PRISM orders, tapped from cables elsewhere, somehow collected inside Germany, or perhaps shared with the NSA by German intelligence. This last option is by far the most controversial and the most illegal in Germany. The battle for Deutungshoheit, therefore, consisted in denying any German involvement and projecting the German government, like the people in question, as passive victims of US intrusion.

On the other hand, Snowden’s support-network in the Berlin digital activist world, centred around Jacob “ioerror” Applebaum, strove to imply that in fact German agencies had been active participants, and Snowden’s own choice of further disclosures seems to have been guided by an intent to influence German politicians. Der Spiegel, rather than the Guardian, has been getting documents first and their content is mostly about Germany.

In this second phase, the German political elite has shifted its feet; rather than trying to deny any involvement whatsoever, they have instead tried to interpret the possibility of something really outrageous as being necessary for your security, and part of fundamental alliance commitments which cannot be questioned within the limits of respectable discourse. The ur-text here is Die Zeit‘s interview with Angela Merkel, in which Merkel argues that she knew nothing, further that there was a balance to strike between freedom and security, that although some kinds of spying were unacceptable, the alliance came first. The effectiveness of this, at least in the context of the interview, can be measured by astonishingly uncritical questions like the one in which she was asked “what additional efforts were necessary from the Germans to maintain their competitiveness”.

So what’s going on? British intelligence historian Richard Aldrich’s history of the UK signals intelligence agency, GCHQ, is illuminating. He argues that since the 1980s, the (West-) German government has had a long-term policy of building up the BND intelligence agency’s SIGINT capability. This was explicitly encouraged by the NSA, specifically its then director William Odom, who wished to get less European intelligence from the British. Obviously, this implies German intelligence sharing with the NSA.

At the same time, the (West-) Germans wanted to get more of their own information on subjects that interested them, notably operational-level (corps and above) military intelligence on the Soviet forces. The British were also concerned about this, for different reasons. The intelligence alliance between the UK and US, and the so-called Tier 2 partners (Canada, New Zealand, and Australia), predates NATO and was often sceptical about the security of NATO and West German institutions. As a result, signals intelligence reaching NATO commanders in Germany was often marked CAN/US/UK EYES ONLY and therefore too secret to show the Bundeswehr, who were providing 500,000 soldiers in 12 armoured and mechanised divisions with 24 hours’ notice. The absurdity of this can be seen from the fact that NATO multinational HQs often had a German general as one of the three posts of commander, deputy commander, or chief of staff. The British were, for their part, concerned that the US system was not going to get usable reports forward into the field in time to be any use. Both the UK, with the Nimrod R1 program, and the Germans spent serious money to solve this.

Another factor in the 80s was that France was encouraging other European countries to contribute to its own intelligence collaboration. Joining this would only add a further degree of dependence, on France, if Germany didn’t bring something to the table. Building up the BND and sharing information therefore served several different motives.

There was a patron-client motive, in which the Germans sought greater independence from the US (and its allies). There was an alliance-integration motive, in which the Germans (and the UK, and the US) sought to strengthen the alliance’s (or alliances?) technical capability and to deepen the partners’ commitment to it (them?). And there was also a bargaining or marketlike motive, in which the Germans were seeking to have more intelligence on hand that could be traded for advantages, whether with the French, the US, or whoever. I think this is also true of the other participants in the intelligence alliances – the UK, for example, didn’t build its own satellite capability, partly because there was a feeling that the Americans would do it better, but also because participating more deeply in the US satellite program, by having part of the take from the satellites downlinked at Menwith Hill and analysed at GCHQ, created a stronger bargaining position with the Americans (and others) in terms of the final intelligence product.

We now know, thanks to the latest Snowden event, that the BND and the federal version of the Verfassungschutz were offered the use of the X-KEYSCORE system, which seems to be an analytics tool for working with a wide variety of Internet surveillance data sets. Interestingly, the Verfassungsschutzer were offered training by BND officers, implying that they already had the system.

The US motive can also be analysed in the same terms as above. As an ally, they may have wished to strengthen German antiterrorist efforts (this happened shortly after the discovery of a terrorist plot in Germany). As a patron, they may have wished to reward their client, and also discourage them from developing their own technology or cooperating with some other party (like China!, following Britain’s lead). This was fairly common in the cold war era, according to Aldrich, when there was both a will to improve NATO communications security and a will to maintain some advantage over the other NATO partners. And as a bargaining actor, they may have acted because they were offered a good deal in return. So, what was the deal?

(If you want a clue, you might wonder what the large company operating in both the US and Germany mentioned in some of the PRISM documents is.)

In general, I think the BND is likely to have shifted from being closer to the “patron/client” model, towards “bargaining/market”, while still being very much “alliance/integration”. After all, the last sections of the NSA facility in Germany were handed back in May last year. It is very telling, though, that one of the first reactions to the Snowden disclosures from German politicians was outrage that Germany wasn’t considered even a “Tier-2″ partner – probably fake outrage from those in the know. (As we have seen, this term has a definition.) This isn’t the reaction of people who are horrified at the thought of spying, though, rather that of people shocked that their investment in spying is not paying off as well as they hoped.

So, to round off, the point of the battle for Deutungshoheit is to maintain the primacy of Atlanticism in German public debate on foreign policy. This is, in many ways, the mirror image of the primacy of ECB-ism in debate on economic policy. Those who accept the consensus are respectable, those who aren’t, aren’t. If you doubt, the same issue of Die Zeit would tell you that the EU-US trade agreement must be signed for the sake of the “political West”. Everything going on here is touching on German privacy fear, but also on profound questions of geopolitics, and just politics. It is therefore very interesting that Der Spiegel, usually very, very NATO-minded, is being so difficult and un-biddable.

It is also probable that Edward Snowden’s best chance to get out of Russia is to disrupt the politics of SIGINT in Europe as much as possible.

We still owe it to them, and blaming private companies will not do.

Back in 2007, the Danish army withdrew from Iraq. The government originally tried to avoid accepting Iraqis who had worked for the Danes as refugees, despite the fact that they were in grave danger of reprisals. Eventually, after a protest campaign and a protest by senior army officers, the Danish government gave in. In the UK, this example was followed – the government tried to wriggle out of it, this blog among many other people protested as part of Dan Hardie‘s campaign, and eventually some action was taken.

History is repeating itself, as Le Monde reports. The story is paywalled, but the essential point is that the NATO deployment to Afghanistan will only shrink from here to 2015, the Danes will be off very soon, and again the government is trying to wriggle out of its obligations to Afghans who they relied on in a variety of roles and who are now faced with Taliban vengeance.

This time, though, the cowardice and moral abasement has reached a new low. The official argument is apparently that the interpreters (and others) were employed by a private company, and therefore it is nothing to do with Denmark! This is repellent. It is not just that a moral obligation exists, or that a norm of common decency is involved. This attempt to hide behind privatisation is undignified, dishonest, dishonourable. Everyone involved ought to be deeply ashamed.

Now I strongly suspect that history will repeat itself in the UK as well, and no doubt in the other European contributors to ISAF. So it is important to get angry early, in order to make an example to the others. To lead off, I will ask a question.

The story above refers to a supposed private company, says that it is a British company, and then names it as LSU or Labour Support Unit. But there is no such company registered in Britain. “Labour Support Unit”, in general, is a British military organisation, a staff attached to a large formation or garrison that is responsible for employing civilians.

So either Le Monde is confused, perhaps because “company” can be a business, a social group, or a military unit in English, or else the Danish government is bullshitting to its own public that it’s all the problem of the private sector, while hoping that the British government sorts out the problem and spends the money. This is a sorry, sordid business.

Of fish, flowers, AKs, offshore banking, and now horsemeat

The horsemeat scandal has taken an unexpected, and possibly very significant, turn. So the Cyprus company controlled by Dutch meat merchant Jan Fasen, who was caught last year passing off South American horsemeat, and which is accused of doing the same with horses from Romania and the British Isles, turns out to have a single director, which is itself a company. (Fasen’s firm, if you haven’t heard, is named Draap, or the Dutch word for “horse” spelled backwards.)

This second company, Guardstand, also controls something called Ilex Ventures, which was used by…ahem…the international arms dealer Viktor Bout to buy some aeroplanes. Oh. Guardstand, for its part, is controlled by something called Trident Trust, which is a company-formation agent in Cyprus, which mostly serves Russian customers.

Now, it would probably be wrong to assume that Bout was behind the horsemeat racket or that some huger interest controlled both. It is probably more useful to look at this from a horizontal, functional perspective. Both Bout and the horsemeat guy made use of Cyprus’s role as a Russian-speaking offshore financial services centre with access to the eurozone.

There’s quite a lot more information at Reporting Project, which speaks to this point. The corporate structure is more complicated than the Guardian piece suggests. Draap’s sole shareholder is Hermes Guardian Ltd. in the British Virgin Islands, its sole director is Guardstand, and the company secretary is Trident Trust. Hermes Guardian is a shareholder in numerous other Cypriot companies, and one of its directors is the head of the Cypriot Fiduciary Association. And both Guardstand and Trident were also used during a half billion dollar acquisition of a steel mill in Donetsk.

All this originated because of the existence of a tax treaty between the Soviet Union and Cyprus. Russians and Russian money have been very obvious in Cyprus in the euro era.

It is often suggested that this treaty, like the similar one with Iceland, was intended by the Soviet side to help finance their intelligence agents in the West. If true, it’s possible that Bout would have been aware of it, having worked for the GRU (Soviet/Russian Military Intelligence) in Africa in the 1980s. As he used the Sharjah Airport free-trade zone as the trading and aviation centre of his business, he may have used Cyprus as the financial centre. These are the places where the rubber meets the road of globalisation, and they tend to build up a layer of secrets over time.

This immediately reminds me that his alleged financial manager, Richard Chichakli, has recently surrendered to Australian police after eight years on the run. He’s been extradited to the United States, where Bout is serving his sentence, still protesting to Russia Today that he only ever dealt in fish and flowers.

Now, for the other significant bit. Cyprus has a lot of the same economic problems as, say, Greece. Notably, its banks are in trouble and the sovereign may have to bail them out and the sovereign itself will end up bust, so on and so forth, we all know the story by now. One of the reasons the Cypriot sovereign is on the hook for quite so much money is that Cyprus has surprisingly big banks. Of course, they’re linked up to the rest of Europe via TARGET 2, so if the big depositors spook*, it’s an instant run on the bank.

Big depositors, you say? And who might they be? I think it is fair to say that nobody is particularly keen to bail out Viktor Bout or Horsemeat Guy. As a result, it’s politically very possible that the whole idea of a bail-in might get tested. And whether it does, and the exact terms, are increasingly linked to things like “how far into the maze the journalists get” and “whether Richard Chichakli starts singing in jail”.

And we may be going to see what happens when an offshore financial centre goes bust.

*surely the right word here…

Kurds

A serious Iraqi newspaper is saying openly that it may be time to give up the Shia-Kurdish alliance that has run Iraq since Saddam, and let the Kurds move on to independence.

Shots fired at an Iraqi army helicopter to keep it from reconnoitoring Kurdish positions, while Jalal Talabani is seriously ill.

Exxon Mobil is giving up on its contracts with Iraq to concentrate on Kurdistan.

Old story, but good: the Turks have a backchannel from their secret service to the Kurds. This caused a major demo round the corner from here today.

The Kurds have, of course, staked out a big chunk of Syria after the government withdrew to fight more worrying rebels. What if this was the year they got what they wanted? I remember blogging years ago that putting a tough and well organised mountain guerrilla army between Turkey and Iraq seemed a fine idea from a Turkish point of view.

Some French links

Here’s a really interesting piece about French interior minister Manuel Valls and the network of friends around him from his days as a student activist. They include Alain Bauer, Nicolas Sarkozy’s security adviser and the man who got the contract to install Vitrolles’ CCTV surveillance network for its FN mayor.

Hubert Vedrine, former minister, was asked to prepare a report on NATO and France’s return to the integrated command structure. Olivier Kempf blogs it. The recommendations are that NATO stays very much in its classical form, a military alliance with a nuclear dimension centred in Europe and the North Atlantic, that France assert itself in the alliance more, and that the European Defence Agency and NATO Supreme Allied Command-Transformation, which are both headed by French officers, should coordinate more closely on industrial and scientific issues.

He seems to be more suspicious of the UK than of NATO as such, and is very critical of the EU defence initiatives as mostly creating duplication, committees, and complexity.

History is made at night records the moment when “discotheque” became a word in English.

ECB board member: Euro-bashing is Anglophone overload

Germany’s man at the ECB, Jörg Asmussen, in a speech about monetary policy communication today:

For the euro area and the ECB, the situation is even more peculiar, because the influential “commentariat” comes predominantly from outside the euro area. The big English-language newspapers, the news agencies and wire services that shape opinions in the economic and financial sphere on the Continent are all writing from outside the euro area. There is, of course, nothing wrong with friendly outside advice. And I certainly do not wish to come across as whining and complaining.

But it simply remains a fact: the analysis, discourse and policy prescriptions that are propagated come from the outside. Maybe inevitably, they come with a certain disinterested detachment. As if the outside “spectators” are not affected by what is happening.

And they come with a dangerously narrow and exclusive perspective on the economics of the monetary union. But if the profound political commitment of Eurozone countries to the historical project of “ever closer union” is neglected, the assessment remains superficial and partial. And the suggested policy responses may be biased or naïve.

Why does it matter? Because the discourse influences some of the most important financial markets for the Eurozone. If expectations that have been built up are not fulfilled, if alleged certainties do not materialise, if actions from politicians or central bankers are not forthcoming as anticipated by the “market consensus”, the reaction can be grave: volatility, contagion, all the way to complete market dysfunction. The systemic impact can be major, driving financial institutions, as well as sovereign borrowers into real difficulties.

It doesn’t take much extrapolation of what he says to envisage that at least in the ECB’s mind, there is a SPECTRE-like entity of cackling pundits consisting of Paul Krugman, Martin Wolf, Simon Johnson and others, though who exactly has the white cat sitting in their lap as they press “Publish” is not specified. More substantively. there is a strange symmetry between this view and the pre-crisis gloating of the European Commission that the single currency’s American critics had been all wrong.

NHS in “worse than unlimited budget for single patient” shock

The Wall Street Journal Europe uncorks an instant classic in explaining the longevity of Lockerbie bomber Abdel Baset al-Megrahi:

Karol Sikora, a leading cancer specialist who examined Megrahi shortly before his release, explains that predicting how long a patient with end-stage prostate cancer has to live is “a value judgment of probability,” not an exact science. But Dr. Sikora also writes that his initial three-month prognosis was “based on his treatment as an NHS patient in Glasgow at the time, when not even standard docetaxel chemotherapy was offered.” By contrast, “Mr. Megrahi almost certainly had excellent care in Tripoli.” Think about that one: Get treated for cancer by the U.K.’s National Health Service, and you’ll be dead by Christmas. But get treated for the same cancer in Libya, and you may have years to live. No wonder Americans are terrified of government-run medicine and rationing boards.

It’s painfully obvious but apparently nonetheless necessary to point that Mr al-Megrahi was in this case receiving care as a political trophy in a petro-state with an open-ended government budget available to embarrass his former hosts. So Yes, his care was probably better than  the NHS standard available to him in Glasgow, but as Dr Sikora also explains, there was a lot of variability around the now-notorious “3 months to live” prognosis even at the time it was issued. His care was also a lot better than someone without health insurance in the USA would receive, but who wants to descend to cheap health system point scoring based on a single case. Besides the Wall Street Journal.

My own view is that there’s no big conspiracy theory or undiscovered files behind Mr al-Megrahi’s release. Instead, the issue played into the self-righteousness of the SNP government. Up against that, geopolitics didn’t stand a chance.

Can This Really Be Europe We Are Talking About?

In recent days I have been think a lot, and reading a lot, about the implications of Greece’s recent election results.

At the end of the day the only difference this whole process makes to the ultimate outcome may turn out to be one of timing. If  Alexis Tsipras of the anti bailout, anti Troika, party Syriza won and started to form a government then the second bailout money would undoubtedly be immediately stopped. On the other hand if the centre right New Democracy wins and is able to form a government, as the latest polls tend to suggest, then the country would quite possibly try to conform to the bailout conditions, but in trying it would almost certainly fail, and then the money would be stopped. Before the last election results, it will be remembered, this was the main scenario prevailing. Continue reading