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How the NSA Is Harming America's Economy 330

Posted by Soulskill
from the surveillance-industrial-complex dept.
anagama writes "According to an article at Medium, 'Cisco has seen a huge drop-off in demand for its hardware in emerging markets, which the company blames on fears about the NSA using American hardware to spy on the rest of the world. ... Cisco saw orders in Brazil drop 25% and Russia drop 30%. ... Analysts had expected Cisco's business in emerging markets to increase 6%, but instead it dropped 12%, sending shares of Cisco plunging 10% in after-hours trading.' This is in addition to the harm caused to remote services that may cost $35 billion over the next three years. Then, of course, there are the ways the NSA has made ID theft easier. ID theft cost Americans $1.52 billion in 2011, to say nothing of the time wasted in solving ID theft issues — some of that figure is certainly attributable to holes the NSA helped build. The NSA, its policies, and the politicians who support the same are directly responsible for massive losses of money and jobs."
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How the NSA Is Harming America's Economy

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  • tough love (Score:5, Interesting)

    by TheGratefulNet (143330) on Friday November 15, 2013 @12:45PM (#45434171)

    #include "grumpycat"
    printf("good!\n");

    seriously, I would not trust US hardware and software, either.

    but then again, those routers are already at every choke-point on the internet. the US owns the internet (public one, anyway) in all practical ways.

    but for private networks when you can pick which routers and switches you want to deploy, picking a US based vendor would not be wise. I would not do it if I was in charge of a private network.

    maybe its time we consider going back to software (oss) based networking gear. it will be much slower than hardware based ones but we can't verify hardware designs like we can software ones.

    there is also no way to put this genie back into the bottle. once your cred is gone, its gone. and the US has lost ALL cred when it comes to safeguarding your privacy.

    sad but true. as a US citizen, I am sorry for how badly we have botched the world's trust.

    • Re:tough love (Score:5, Informative)

      by Kjella (173770) on Friday November 15, 2013 @01:13PM (#45434509) Homepage

      maybe its time we consider going back to software (oss) based networking gear. it will be much slower than hardware based ones but we can't verify hardware designs like we can software ones.

      That software has to run on hardware and if you can't trust the hardware you are screwed anyway, it's like trusting your software (oss) encryption when there's a hardware keylogger installed. Send the right magic numbers and the hardware could start doing anything it wants like mirroring traffic, dumping memory, whatever the attacker needs to completely compromise the box. The only advantage would be that it could run on more generic hardware that you hopefully could buy from a more trusted supplier.

    • Re:tough love (Score:5, Insightful)

      by fustakrakich (1673220) on Friday November 15, 2013 @01:15PM (#45434533) Journal

      In today's multi/transnational corporate world the USA does not exist. The famous Authur Jensen speech from 1976 comes to mind. There is nobody that's going to protect us from this anywhere in the world. Anybody who tries will be 'liberated'. And the biggest part of the problem is that people keep on blaming policy and politicians for this, and nobody will look in the mirror and admit that they voted for it, To them I say, *you asked for it, thankyouverymuch.* The ball is in our court.

    • Re:tough love (Score:4, Insightful)

      by Nemyst (1383049) on Friday November 15, 2013 @01:20PM (#45434597) Homepage
      I wouldn't trust US hardware, Chinese hardware, Russian hardware, European hardware, Australian/NZ hardware.... Where does that leave us really?
    • Re:tough love (Score:4, Insightful)

      by Anonymous Coward on Friday November 15, 2013 @01:22PM (#45434625)

      It's not a about 'cred'... dude.

      When your government puts its own institutional interests above those the people from which it derives its democratic legitimacy, it's no longer acting democratically. So, technically, once the US began operating imperially, back in the 19th century, the slow withering rot of oligarchy began to emerge as the driving farce behind the facade of electoral chaos.

      Take the case of Teddy Roosevelt who believed that the US naval superiority should be used offensively to increase domestic political power by use of force or the ease by which Truman chose to drop not one but two weapons of mass destruction on the Japanese. These actions were neither expressions of democracy of altruism. They were imperial. Not that we should overlook the covert actions of the Dulles brothers when they used the Dept of State and CIA to prosecute the interest of US corporate business around world in the 50s.

      The players have changed but the song remains the same, and now that the world is largely developed and includes 7 billion people who tend to get in the way, either legally or by their mere presence, there's nothing left to do but degrade the wealth of those who share the same nationality. So get ready for the 21st Century. It's going to be a bumpy ride if you still believe in the fairy tale of Democracy for all or self determination for anyone.

      • Re:tough love (Score:4, Insightful)

        by SternisheFan (2529412) on Friday November 15, 2013 @01:51PM (#45435019)

        or the ease by which Truman chose to drop not one but two weapons of mass destruction on the Japanese.

        Truman was trying to end the war between Japan and the U.S. before it could become a long, drawn out ground war costing millions more lives. AFAIK, the U.S. only had enough material for the 2 bombs (after testing), which of course was not made public. Japan did not immediately surrender after the first A-Bomb attack, and that's when the 2nd bomb was used, and only then did Japan surrender. Thank God that Japan did not know that Truman was bluffing his poker hand, or the war could have gone on far longer.

        • Re: (Score:3, Informative)

          by 0123456 (636235)

          AFAIK, the U.S. only had enough material for the 2 bombs (after testing), which of course was not made public.

          Uh, not true. They were pumping out new bombs on a production line, and the third bomb would have been ready to go soon after the second was dropped; Truman vetoed any further use. If I remember correctly, they were up to about one bomb a month by that point, and accelerating.

          • AFAIK, the U.S. only had enough material for the 2 bombs (after testing), which of course was not made public.

            Uh, not true. They were pumping out new bombs on a production line, and the third bomb would have been ready to go soon after the second was dropped; Truman vetoed any further use. If I remember correctly, they were up to about one bomb a month by that point, and accelerating.

            Correct, but the U.S. had used up it's inventory...

            " Charles Sweeney published his memoirs as War's End: An Eyewitness Account of America's Last Atomic Mission (Avon, 1997). During the party following the successful Hiroshima drop, he recalled that Paul Tibbets took him aside and told him that he was to command the second atomic mission, with Kokura as the primary and Nagasaki as the secondary target. Timing was important, Tibbets said: "It was vital that [the Japanese] believed we had an unlimited supply

            • Re: (Score:2, Interesting)

              by Anonymous Coward
              The notion that the United States had but two atomic bombs to use against Japan at the end of WWII is false. By August 1945, both the plutonium bomb complex at Handford, Washington and the uranium bomb works at Oak Ridge, Tennessee were in full production mode. According to Captain Don Albury, who flew in both atomic missions, a third atomic bomb was already in the pipeline---I believe at Wendover, Utah---soon after Nagasaki. He told me personally in July 2002 that Kokura was the target of the third atomic
          • all not true (Score:3, Informative)

            by schlachter (862210)

            I've personally seen the declassified war documents written by the leaders of the DoD at the time.

            Japan was on the verge of surrender before we bombed them. The USA knew this. It was a conditional surrender to USSR. The USA demanded an unconditional surrender to the USA, for strategic and practical reasons. The cold war was already ramping up. The USA President and War Secretary decided to drop the bombs to force this surrender.

            You can read about all of the above in these docs. Copies of them are located at

        • Re:tough love (Score:4, Insightful)

          by odigity (266563) on Friday November 15, 2013 @02:54PM (#45435815)

          Truman was trying to end the war between Japan and the U.S. before it could become a long, drawn out ground war costing millions more lives. AFAIK, the U.S. only had enough material for the 2 bombs (after testing), which of course was not made public. Japan did not immediately surrender after the first A-Bomb attack, and that's when the 2nd bomb was used, and only then did Japan surrender. Thank God that Japan did not know that Truman was bluffing his poker hand, or the war could have gone on far longer.

          Oh yes, please continue to to repeat that mass-murder-justifying state propaganda. It does wonders for our society's ability to think clearly about moral issues.

        • Re:tough love (Score:5, Interesting)

          by Mprx (82435) on Friday November 15, 2013 @03:18PM (#45436105)
          There's a strong argument that the real reason for Japan's surrender was the Soviet invasion of Manchuria, which happened at the same time. You'll note that the Allies did a lot of damage to Japanese cities with conventional weapons without forcing surrender. The firebombing of Tokyo caused similar damage to the bombs. The bombs however were a convenient excuse to avoid losing face, because unlike the Manchuria campaign they couldn't be blamed on Japanese military incompetance.
    • And so one thinks that these back doors only exist in U.S. products? Maybe Cisco, et.al. would be more "open" to their protocols? Maybe more profit could be made by approaching solutions were simplicity is illuminated?
    • Re: (Score:3, Insightful)

      by marcello_dl (667940)

      > sad but true. as a US citizen, I am sorry for how badly we have botched the world's trust.

      Don't worry, you never have been trusted as a nation. Individual Americans, sure, I am likely to trust them more than my countrymen, but collectively all political entities behave the same. Our interests first.

    • You CAN build your own routers....it may not be 1U but it will be secure.

    • by AmiMoJo (196126) *

      Fortunately most secure internet protocols are designed on the assumption that you can only trust the end points, not anything in-between them. As such replacing the end-point routers with non-US hardware/software will improve security.

  • by Anonymous Coward on Friday November 15, 2013 @12:47PM (#45434199)

    Let Brasil and Russia buy Chinese then. They deserve only the best.

    • Re:Buy Chinese... (Score:5, Insightful)

      by elloGov (1217998) on Friday November 15, 2013 @12:55PM (#45434299)
      Had you any business acumen, you'd realize that your short-sighted vision will bite you in the bum long-term. "Yes, we suck, but the other guys suck worse" Eventually, someone will come along/transform to provide a better solution and eat your lunch.
    • by Lisias (447563)

      Yeah, right.

      And exactly from where do you think all that "good and cheap" goodies you buy around you there in America comes from? Or do you think that Cisco have any manufacturing on EUA?

      Speaking frankly, buying stuff directly from China will just cut off the man-in-the-middle money sucker on the manufacturing chain, also known as U.S.A.

      *OF COURSE* that most of these devices are *INVENTED* by americans on America, and on the long run these same goodies will be deprecated without a proper (modern) replacemen

  • by Sean (422) on Friday November 15, 2013 @12:50PM (#45434225)

    As soon as software catches up and makes it practical, the rest of the world is going to dump the US cloud forever.

  • by Krneki (1192201) on Friday November 15, 2013 @12:50PM (#45434231)

    How much taxes is Cisco paying to the US government? Because if they pay like every other corporation (1%), then the fact that they now sell less won't have any repercussion on the tax income.

    I still hate NSA, but this looks like two ass-holes pointing fingers at each other.

    • by fredrated (639554)

      Employees pay taxes, if they sell less gear they will employ fewer people that will collectively pay less in taxes.

    • by compro01 (777531)

      Cisco sales go in the toilet -> Employees laid off -> no income/FICA tax from them.

    • by PPH (736903)

      Stop measuring the economic contribution of an event solely in terms of tax revenue. Cisco pays salaries, purchases goods and services from subcontractors, pays dividends, etc. All contributions to the economy before the gov't takes its cut.

  • by elloGov (1217998) on Friday November 15, 2013 @12:50PM (#45434233)
    Quoting Bob Marley, economy is the bloodline of any society. It's where the buck stops. I hope that our "patriotic"(nationalist) Orwellian ways can play a second fiddle to our economy. If not, we are paving our path to our own demise.
    • by Kjella (173770)

      Quoting Bob Marley, economy is the bloodline of any society. It's where the buck stops. I hope that our "patriotic"(nationalist) Orwellian ways can play a second fiddle to our economy. If not, we are paving our path to our own demise.

      As long as it doesn't backfire in the public opinion, a lot of Americans might be sympathetic to exposing the extensive spying on others but when it starts hurting their own wallet is that anger going to be directed at Snowden or the NSA? I mean in the whole "Snowden - hero or traitor?" debate tanking the US economy is probably not a plus. Personally I think you'll get a lot of first-order reaction and the second-order reaction "But should we really have been spying in the first place?" will be much weaker,

  • by jodido (1052890) on Friday November 15, 2013 @12:56PM (#45434303)
    These are the people who invented the phrase "destroy the village in order to save it"--do you think they give a shit about Cisco stock?
  • by thoth (7907) on Friday November 15, 2013 @12:58PM (#45434329) Journal

    Harming America's economy? This is more about affecting Cisco's profits. And color me unsympathetic, as they are an "American" corporation (in scare quotes since it shifts as it suits them) when it comes time to complain about something, but they are apparently Swiss http://www.bloomberg.com/news/2011-06-28/biggest-tax-avoiders-win-most-gaming-1-trillion-u-s-tax-break.html [bloomberg.com] when its time to pay taxes.

    • Re:Misleading Title (Score:5, Interesting)

      by 0123456 (636235) on Friday November 15, 2013 @01:02PM (#45434379)

      This isn't just Cisco. No-one can trust US technology any more; they've got from the most trusted on the planet to, at best, no better than the Chinese, in the space of a few months.

      • That's to be expected. Security of data is critically important to all businesses, even the American ones who are also affected by the NSA scandals. I would expect politicians to be in an uproar and call for the dismantling of the NSA and for all their secret projects to be disclosed and security holes patched up so America can once again be trusted.

        Lol, who am i kidding. I expect people to be silenced, jailed, tortured and publicly humiliated if they dare speak the truth again, and for the NSA's budget

    • by larry bagina (561269) on Friday November 15, 2013 @01:05PM (#45434431) Journal

      And they're Greek when it comes to sex, if you know what I'm saying.

      Edit: for those that don't know what I'm saying, Cisco likes to fuck you in the ass.

  • No shit ... (Score:5, Insightful)

    by Anonymous Coward on Friday November 15, 2013 @01:02PM (#45434371)

    If the American security infrastructure is going to turn American corporations into de-facto arms of the intelligence process, then nobody has any choice but to not trust them.

    Anything involved in the security of the internet that's been tainted by being complicit with the NSA et al can't be trusted. So Cisco is going to feel the pinch.

    Anything in 'the cloud' ran by a US company is subject to PATRIOT Act demands. So Oracle, Microsoft, Amazon ... they're all going to feel the pinch. And Google's hosted solutions for email is also something you can't trust.

    When the NSA undermines security for their own ends, then anything they've had a hand in can't be trusted.

    So the end result is most governments and companies in other countries more or less have to look at any US player as not trustworthy, or actively hostile to your goals.

    As long as you keep acting like your security trumps the sovereignty of everyone else ... well, the only answer is to say "OK, fuck you" and cut you out of the picture entirely.

    All of your big corporations are more or less presumed to be lying (because they can't admit to participating in this), complicit with collecting data to send back to Big Brother, and violating local privacy and data access laws.

    And since 'Murica has been railing about how the Chinese are infiltrating their stuff (while doing the same thing), and complaining about countries which restrict a free internet ... they've lost a position of having the moral high ground. The US is doing everything they accuse other countries of doing, only they're apparently doing it on a massive scale.

    So, yes, this should have an impact on the US economy. And you can choose to stay the course and see it keep happening, or you can fix the problem. And so far, we've seen no evidence whatsoever there's any contrition or accepting that what they did was going to piss off everyone else.

    But when all of those orders start getting cancelled, and new ones stop coming, don't stand around wailing about how unfair it is that people have decided they can't trust you and don't want your stuff.

    But in a country which is actively ignoring its own Constitution and freedoms, I'm not expecting any meaningful introspection on behalf of the US. I'm expecting more bluster, claims about how everyone else is doing it, and continuing with the status quo.

  • I'm out! (Score:4, Interesting)

    by snarfies (115214) on Friday November 15, 2013 @01:05PM (#45434415) Homepage

    When SOPA was a looming thing, I was in the market to move from shared hosting to a VPS, and so I made it a point to chose a VPS that was in another country.

    Sadly, I chose the Netherlands, who are NSA collaborators. I'm just waiting for a specific piece of software to be released, and I'm out of there and on to a new server in a new country - I'm thinking Switzerland right now. Iceland is too expensive.

  • ...and wake up muddy. Or something like that.

  • So they are countering this bad press by open sourcing the system and inviting everyone to verify that their hardware is ait-tight secure, right? Right?

    *crickets*

  • its policies, and the politicians who support the same are directly responsible for massive losses of money and jobs

    How does that compare to, say, the policies that have made offshoring lucrative, or the changes to depression-era rules that allowed the 2008 global economic meltdown?

  • by Dega704 (1454673) on Friday November 15, 2013 @01:26PM (#45434693)
    You could make the argument that this is overblown, but you cannot deny that it is true at least to some significant degree. The ironic part is how the U.S. government has been warning us about the coming cyber-apocalypse, and it turns out that they have done more to stoke those flames than anybody else.
  • If these other Countries don't want to buy All-American products with Freedom® and Democracy® built-in, then they stand against us in our Global War of Terror

  • Encrypt everything (Score:5, Insightful)

    by jones_supa (887896) on Friday November 15, 2013 @01:36PM (#45434823)
    We have found that we cannot trust the networks of ISPs anymore: there can be an NSA tap anywhere. A good and practical move would be to start using more and more robust end-to-end encryption. Things like SSL are possibly out of question as NSA has corrupted the root certs.
    • by Jawnn (445279)

      Things like SSL are possibly out of question as NSA has corrupted the root certs.

      [citation needed]

  • by cardpuncher (713057) on Friday November 15, 2013 @01:42PM (#45434903)
    Listen up. Any news that casts an unfavourable light on the economy is a risk to your economic security. It must therefore be kept strictly secret. Anyone found spreading this unpatriotic propaganda is going to find themselves in a re-education camp.

    Yours sincerely,

    The government of North Korea^W^Wthe USA.

  • by openthomas (2759671) on Friday November 15, 2013 @01:49PM (#45434989)
    These leaks have cost America the trust of an entire generation. In the last few months I deleted my gmail, linkedin, facebook, twitter, ebay and amazon accounts, and when my cellphone dies I won't buy another. If US companies deny their customers the basic human right that is dignity through privacy then it will be to their extreme financial loss. Personally I want no part of what these services have to offer because they do not respect me as a individual. I don't trust the hardware, the software, the services, the network, the companies or the government. And google can stick glass up their ass.
    • by SirGarlon (845873)

      If US companies deny their customers the basic human right that is dignity through privacy then it will be to their extreme financial loss.

      Unfortunately, current trends suggest there are not enough people who give a damn about their privacy to make a dent in the bottom line.

      It's corporations who buy Cisco's routers, and they do care, because they have trade secrets and business plans to protect. But regular consumers? They *want* to be spied on by Google and Facebook.

  • Isn't this the same US government who's been slagging off Huawei hardware because the chinese might be sneaking backdoors into Huawei hardware...?

    What goes around, comes around...
  • by Emetophobe (878584) on Friday November 15, 2013 @02:13PM (#45435321)

    Not just the NSA, but the TSA aswell. Myself and many other Canadians that I know refuse to vacation in the States anymore because of the invasive border checks.

  • When it comes to hardware in terms of company and/or country, who can *anyone* trust?

    And evoking Reagan 's speech writer, how the hell would you verify anyway?
  • "HAHAHAHAHAHA (Score:4, Insightful)

    by GameboyRMH (1153867) <{moc.liamg} {ta} {hmryobemag}> on Friday November 15, 2013 @03:04PM (#45435941) Journal

    HAHAHAHAHA Yes this is so perfect! It just keeps getting better and better!" - Bin Laden's ghost

Simplicity does not precede complexity, but follows it.

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