[Plura-list] Rabbits: PK Dick meets Qanon; Apple's manorial security; Billionaires don't pay tax; Google and France agree on ad-tech interop

Cory Doctorow doctorow at craphound.com
Tue Jun 8 13:23:37 EDT 2021

Today's links

* Rabbits: PK Dick meets Qanon: Terry Miles's debut novel of
conspiratorial madness.

* Apple's manorial security: Works well, fails badly - think different?

* Billionaires don't pay tax: Leona Helmsley was an unrecognized genius.

* Google and France agree on ad-tech interop: Not the kind of
competition we want.

* This day in history: 2011, 2016, 2020

* Colophon: Recent publications, upcoming/recent appearances, current
writing projects, current reading


👨🏾‍🔬 Rabbits: PK Dick meets Qanon

RABBITS is Terry Miles's debut novel - a taut, conspiratorial thriller
with overtones of PK Dick by way of Qanon and Dark City.


"Rabbits" is the secret name for a mysterious game (AKA "The Game") that
is shrouded in secrecy and is played by deciphering impossible clues,
like extra tracks appearing on a beloved vinyl record or hidden levels
on floppies of old games with references to modern events.

K's sidehustle is teaching curious people about the game and the handful
of "winners" - known only by aliases that appear in impossible
leaderboards, like glitched out reports from the Tokyo Stock Exchange -
after hours at a Seattle retro video arcade.

But K's life is upended one night when a reclusive billionaire attends
one of his lecture sessions, tangles some tantalyzing information about
changes to Rabbits, and then vanishes utterly.

A new round of the game is now on, and K and his friends are in the
thick of it - and yes, there's *definitely* something wrong with this
iteration of the game, as players start to disappear or turn up
mysteriously, horribly dead.

K's life is unraveling at the same time, as he suffers blackouts and
false memories: a restaurant that closed six years ago being open and
none of his friends recalling the closure, then a new album by David
Bowie drops.

The conspiracies and coincidences in K's life are definitely part of the
game, except maybe they aren't, and K and his friends are drawn deeper
and deeper into an end-of-the-world scenario where violence and murder
are increasingly common.

It's a fantastic and beautifully plotted, paranoid and mystical book,
part pop-culture scavenger hunt (a la Ready Player One), part
image-board conspiracism.


👨🏾‍🔬 Apple's manorial security

While digital feudalism is practiced by many Big Tech companies, Apple
pioneered it and is its standard-bearer. The company rightly points out
that the world is full of bandits who will steal your data and money and
ruin your life, and it holds itself out as your protector.

Apple is a warlord whose fortress has thick walls and battlements
bristling with the most ferocious infosec mercs money can buy.

Surrender your autonomy by moving to Apple's fortress - where they
choose your which apps and where you get repairs - and they'll defend you.

This arrangement (which should really be called "digital manorialism"
because feudalism involved providing men-at-arms to the monarch) has the
same problem as all benevolent dictatorships: it works well, but fails


When Apple has the same interests as you - when they work against the
bandits, rather than colluding with them - this is great. But when Apple
sides with the bandits, the walls that once protected you now make you
easy prey.

One place where Apple sides with the bandits is China. Access to Chinese
sweatshop labor and the vast Chinese middle-class are key to Apple's
ongoing business interests. So when the Chinese state threatens to take
these away unless Apple turns on its users, Apple folds.

It's been four years since Apple colluded with the Chinese state to
remove working VPNs from its App Store, exposing Chinese users to
pervasive state surveillance.


The benefits of retaining access to China clearly outweighed the
reputational damage from colluding with state oppression, because Apple
did it again, backdooring the encryption for its Chinese cloud servers.


But the problems of benevolent dictatorship go beyond secret
malevolence. A dictator can be benevolent, but incompetent.

This week, the Washington Post published an expose under the admirably
self-explanatory headline, " Apple’s tightly controlled App Store is
teeming with scams."


That hed really says it all: if you think that a "curated" app store is
immune to fraudulent apps that steal your money and you're data, you're

Then there's this equally well-chosen hed from Motherboard over Matthew
Gault's byline: "She Sent Her iPhone to Apple. Repair Techs Uploaded Her
Nudes to Facebook."


Again, this is pretty much exactly what it sounds like: two Apple
service technicians - you know, those guys Apple says you should use
instead of a third-party repairer who might steal your data - extracted
a customer's nudes and posted them to Facebook.

It's not the only time this happened:


nor is it the second:


It might be rampant.

This only came to light because Apple paid the victim a
multi-million-dollar settlement (that came with a gag order so other
people wouldn't learn that Apple's safety claims were lies), and Apple's
insurer refused to pay, triggering a legal dispute.

An app store "teeming" with fraudware, service techs who go spelunking
for nudes to download and share on devices submitted for repair - these
illustrate the core problem with benevolent dictatorships, namely, that
the dictator has to be *infallible* as well as benevolent.

Because Apple has spent millions defeating dozens of state Right to
Repair bills that would let customers decide for themselves whether to
trust Apple's repair technicians.

Because Apple does everything it can to make it illegal to develop a
third-party app store for Ios that would let users decide whether to
trust Apple's "curation."

Any time this level of control is questioned - any time someone asks
whether an Iphone owner should have the final say over whose apps they
use and whose repairs they choose - the answer is that Apple can't
protect them if they get to treat its products as their property.

(I'm leaving aside for now the idiotic no-true-Scotsman argument that
"real" Apple users all like deferring to Apple on these matters, because
of the obvious rebuttal that Apple wouldn't spend millions blocking
these activities if its customers didn't want to engage in them)

Lock in and switching costs don't make companies better defenders of
users' interests - it assures them  that they can sell users out,
underinvest in oversight of their employees, tolerate a certain amount
of predation - and their users will be stuck inside that fortress.

The deal in the warlord's fortress, after all, is that you have to use a
warlord-specified "ecosystem" of proprietary peripherals, media files,
and apps for which the warlord is the sole vendor of runtimes. Leave the
fortress and all this stuff becomes useless.

Business, after all, is business. Companies know that high switching
costs allow them to treat their users worse, because users will weigh
all they surrender when they defect to a rival against the costs imposed
by staying in a corrupt warlord's demesne.

There's another way: technological self-determination, of the sort that
comes with interoperability, right to repair, and an end to the laws
protecting terms-of-service, DRM and other forms of lock in.

If warlords are forced to allow us to leave their fortresses without
being able to punish us for our disloyalty, then we'll truly learn
whether the people who stay within the walls prefer the warlords, or
merely endure them.


👨🏾‍🔬 Billionaires don't pay tax

When Clinton accused Trump of paying no federal taxes, he didn't deny it
- rather, he said, "That makes me smart."

He wasn't the first rich sociopath to make that claim. Remember when
Leona Helmsley told the press "only little people pay taxes?"


Today, Propublica published the first in a series of blockbuster
analyses of leaked tax data from America's richest billionaires - some
of whom have lobbies for higher taxes on the rich! - showing that the
true tax rate for billionaires is 3.4%.


These records - which include tax data for Elon Musk, Warren Buffett,
Jeff Bezos, Michael Bloomberg, George Soros, Carl Icahn and others -
reveal that it's not just sneering boasters like Trump and Helmsley who
avoid the tax the rest of us pay - it's the whole cohort.

Much has been made of the "K-shaped" recovery from the pandemic-driven
economic collapse, where the rich got richer and the poor got poorer,
but when it comes to the 0.001%, this is far more pronounced. America's
billionaires got *$1.2 trillion* richer during the pandemic.

Much of this wealth accumulation is due to the fact that poor people pay
high taxes, while rich people pay low taxes. A household earning $70k
pays about 14% in federal tax; In 2019, Michael Bloomberg made $2B and
paid 1.3% of it in federal tax.

All this wealth-accumulation creates family dynasties, meaning that the
rich stay rich, and the poor stay poor, and the only real social
mobility is downward, as the middle class loses ground and slips down
the ladder.


A quarter of America's richest people owe their fortune to the orifice
they emerged from, not the work they did. These heirs - Waltons, Mars
candy scions, Estee Lauder's kid - are the new permanent aristocracy,
uplifted by the invisible hand by virtue of their "good blood."

The Propublica report - from Jesse Eisenger, Jeff Ernsthausen and Paul
Kiel - is valuable not just for the names it names, but for the
tax-evasion tactics it explains and the historical context it provides.

Whenever someone points out that Jeff Bezos is so rich that he could
afford to give a living wage to his vast, precarious,
food-stamp-dependent blue-collar workforce, someone inevitably points
out that Bezos's wealth is in shares, not cash and is thus illusory.

This is only partly true, and it obscures more than it illuminates. It's
true that CEOs habitually draw nominal salaries - often $1/year - and
are only "rich on paper," but this doesn't mean they're not immensely
wealthy - rather, this is how they amass immense wealth.

Here's how that works: the US only taxes capital gains (money you make
from owning things, as opposed to doing things) when they are "realized"
- that is, when you sell the asset that has appreciated in value. If you
*never* sell your asset, you never pay tax on it.

So when an exec takes compensation in stock rather than cash, the exec
pays no tax unless they sell the shares. But execs don't have to sell
*any* shares in order to get millions or billions of dollars to play
with. Rather, they can stake those shares as collateral on loans.

If an exec sells their shares, they'll pay a 20% capital gains tax. If
they borrow against the shares, they'll pay single-digit interest rates.
What's more, loans aren't treated as income, so *no* tax is paid on the

Even better, the *interest* on the loan can be treated as an *expense*,
which you can apply to any money that comes in the door that you can't
help but declare as income.

Working people borrow money because they can't afford to buy cars or
houses or just close the gap between payday and an empty fridge. Rich
people borrow because it lets them launder their income into tax-free

Here's the thing: this is *exactly* what critics of this system
predicted would happen. In 1920, Rep Cordell Hull ("the father of income
tax") warned that the Supreme Court's ruling in Macomber would let rich
people "live upon the value" of stock "without ever paying" tax.

Congress could have fixed the tax law, but it left this loophole open,
along with other loopholes, like the "step-up in basis" rule that allows
billionaires to pass on vast fortunes without ever paying capital gains
taxes on them (the true origin of "good blood").

When Propublica called billionaires for comment, they either got
stonewalled (Elon Musk sent them a single "?" then ghosted), or heard
bluster about "privacy invasions" or got responses like Warren
Buffett's, about his plan to give away all his money.

That's more "good blood" nonsense: the idea that we should let people
amass vast fortunes through monopoly and exploitation, so long as they -
and not democratically accountable governments - then use it for social

Elite philanthropy is no substitute for democratic programs. It's
primarily a means for the ultra-wealthy to launder their reputations.

Take the Sacklers - made richer than the Rockefellers through the opioid
epidemic's corporate mass murders:


What's more, elite philanthropy is a vehicle for pushing "good blood"
ideology. Bill Gates's foundation didn't just set out to eradicate
malaria, but also public education.


It recycled the materials it used to lobby against letting South Africa
make its own HIV medicine to lobby against a covid vaccine waiver:


This report is the first in a series based on the anonymous leaked data.
Propublica says its source was motivated by their stellar reporting on
the IRS, which revealed the intense lobbying to weaken the agency's
power to audit the wealthy.


Instead, the IRS was perverted so that it primarily targeted poor people
for audits, because they alone were weak enough not to resist the IRS's
starved, resource-poor auditing division.

Propublica still has a lot of data to report out, but they're interested
in hearing from other sources. In this supplemental article, they
explain how IRS whistleblowers and others can securely leak more
documents to them.


And if you don't have time to digest the excellent story with its great
explainers and graphics, Propublica's got a 7-minute read version:


All of this leaves us with a question, though: what should we do about
it? There's a Biden tax plan to raise taxes on the rich, but as
Propublica points out, it will have virtually no effect on the
"buy-borrow-die" mode of wealth accumulation.

Two other proposals *would* have an impact, though: Ron Wyden has
proposed a capital gains tax on unrealized gains:


And both Bernie Sanders and Elizabeth Warren have proposed wealth taxes:



👨🏾‍🔬 Google and France agree on ad-tech interop

It's (mostly) great that Big Tech monopolies are *finally* facing

There are two bad things about monopolies:

I. They cheat their customers and suppliers because they know they're
the only game in town, and

II. They use their money to legalize harmful practices.

Here's a Type I example of how Google uses its monopoly power to cheat:
Google controls the ad-tech market they rig it in their favor - they
represent both buyers and sellers, and they compete with them, and they
advantage themselves.


But Google's ad-tech stack also has a Type II monopoly abuse: the
ad-targeting systems Google sells are extraordinarily, harmfully
invasive. They get away with this privacy abuse because they convert the
money they get from rigging the market to lobby against privacy laws.

There's a real danger that competition authorities seeking to blunt
Google's monopoly will get Type I and Type II abuses mixed up. It's
great to force Google to run a clean ad marketplace, preferably by
forcing it to divest of the units that compete with its own customers.

After all, it's nearly impossible to detect "self-preferencing" in
complex markets - like, did Google place its own ad rather than a
higher-bidding third-party because it was cheating, or because its
algorithm assessed the third-party ad as fraudulent?

And if so, was the algorithm itself designed to overblock third-party
ads as potentially fraudulent while applying a more lax standard to the
ads that Google sells - and makes more money from?

The entity that runs the market is the referee. Referees shouldn't also
be members of one of the teams. Period. Obviously. I mean, come on.

The problem is that breaking up a monopolist is really hard. It can take
decades and cost billions.

So regulators, out of ignorance or desperation, continue to allow
referees to have a stake in the outcome, and instead seek to improve
competition in other domains, especially Type II domains - those bad
actions that monopolists get away with because they're too big to stop.

That's what's going on in France right now. The French competition
regulator just fined Google $268M for anticompetitive ad-tech abuses.
Included in the settlement - which Google says it won't fight - is a
mandate for interoperability in ad-tech.


Interop is a *great* remedy for anticompetitive markets, and indeed, it
makes tech a prime target for competition enforcement. When companies
are forced to interoperate, their "network effect" advantages can be
obliterated, by lowering switching costs.


Interop is a great solution to Type I problems, problems caused by a
lack of competition. But it's a *terrible* solution to Type II problems.
If a monopolist got away with doing something horrible and abusive, we
shouldn't fix that by improving competition.

The last thing we want is competition in practices that harm the public
- we don't want companies to see who can commit the most extensive human
rights abuses at the lowest costs. That's not something we want to
render more efficient.


Unfortunately, that's what the French interop remedy for Google does.
Rather than abolishing or curbing targeting (substituting noninvasive
content-based targeting, reliant on the content of a page rather than
the identity of the user), they're helping *everyone* target users.

As Google wrote in its corporate comms about the ruling, it will improve
interop by creating a way to share ad-tech data with third party
competitors. This is such a fucking monkey's paw.


There's going to be more of this. In the UK, the Competition and Market
Authority's otherwise excellent report on ad-tech calls for widespread
access to "attribution," where ad-tech follows you around forever to see
if an ad leads to a sale.


There are two kinds of entities agitating for more tech competition and
interop. On the one side, you have smaller ad-tech firms and telecoms
monopolists who want competition in commercial surveillance.

On the other side, you have public interest groups like EFF, calling for
interop as a way to help people escape high-surveillance digital
environments by allowing them to take their data with them and maintain
their social ties.


Interop can be fully privacy-compatible - indeed, interop can be a way
to weaken tech and open space to enact and enforce strong privacy rules.

But there's some forms of competition - competition to invade your
privacy - that we should reject altogether, not enhance.


👨🏾‍🔬 This day in history

#10yrsago Richard Dreyfuss reads the iTunes EULA

#10yrsago Top universities a ‘breeding ground’ for Tories, warn Islamic

#10yrsago Copyright extremist RIAA lawyer confirmed as America’s
Solicitor General https://www.wired.com/2011/06/senate-confirms-verrilli/

#5yrsago Password hashing demystified

#1yrsago Big mail providers block indie mailing lists

#1yrago Private equity's coming for your pension

#1yrsago Cops are legally entitled to reject "high IQ" candidates


👨🏾‍🔬 Colophon

Today's top sources: Boing Boing (https://boingboing.net/), Slashdot
(https://slashdot.org/), Gizmodo (https://gizmodo.com/).

Currently writing:

* Spill, a Little Brother short story about pipeline protests.
Yesterday's progress: 253 words (4451 words total).

* A Little Brother short story about remote invigilation.  PLANNING

* A nonfiction book about excessive buyer-power in the arts, co-written
with Rebecca Giblin, "The Shakedown."  FINAL EDITS

* A post-GND utopian novel, "The Lost Cause."  FINISHED

* A cyberpunk noir thriller novel, "Red Team Blues."  FINISHED

Currently reading: Analogia by George Dyson.

Latest podcast: How To Destroy Surveillance Capitalism (Part 06)

Upcoming appearances:

Recent appearances:

* Fireside Chat with Beatriz Busaniche (Rightscon)

* Genre Talk:

* Get Your News On With Ron/Ron Placone:

Latest book:

* "Attack Surface": The third Little Brother novel, a standalone
technothriller for adults. The *Washington Post* called it "a political
cyberthriller, vigorous, bold and savvy about the limits of revolution
and resistance." Order signed, personalized copies from Dark Delicacies

* "How to Destroy Surveillance Capitalism": an anti-monopoly pamphlet
analyzing the true harms of surveillance capitalism and proposing a
(print edition:
(signed copies:

* "Little Brother/Homeland": A reissue omnibus edition with a new
introduction by Edward Snowden:
https://us.macmillan.com/books/9781250774583; personalized/signed copies

* "Poesy the Monster Slayer" a picture book about monsters, bedtime,
gender, and kicking ass. Order here:
https://us.macmillan.com/books/9781626723627. Get a personalized, signed
copy here:

Upcoming books:

* The Shakedown, with Rebecca Giblin, nonfiction/business/politics,
Beacon Press 2022

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