Wednesday, 6 April 2016

A Private Matter

In response to questions about whether he or his family had benefited from an offshore fund set up by his deceased father, David Cameron stated that this was "a private matter". In saying this he was claiming the right of privacy for wealth, which is a notable non sequitor as the question being asked concerned the transparency of taxation, i.e. the right of the citizenry to hold its members to account. In a democratic society, tax is a public matter. If total tax revenues are reduced by the actions of a minority, the shortfall must be made up either by an increase in the effective rate of tax on the majority or by a reduction in public services. People who dodge tax are fee-riders, so there is a moral obligation to show that you contribute your fair share (that "we're all in it together"), not just that you obey the letter of the law. The pedantry of avoidance versus evasion is neither here nor there, nor is your own limited use of public services.

Ethical objections to how public funds are spent, whether on supporting abortion or Trident, are also irrelevant, assuming these choices fairly reflect the democratic will. Tax is a matter for the polis not the oikos, in Aristotle's terms, which means collective decision-making is paramount (demands for a system in which the individual chooses what their income tax is spent on, creating a virtual government machine in every household and thus blurring the boundary between public and private, are as unrealistic as the "nightwatchman state"). While indirect taxes reflect struggles over the interests that the state should serve (Boston tea, Indian salt, British spare bedrooms etc), arguments over income tax reflect differences of opinion on the role and extent of government. They're existential. A reluctance to "render unto Caesar" is a political act that questions the legitimacy of the state.

Cameron's attitude is obviously an unthinking reflection of his class, not least in his employment of the phrase "a private matter" rather than the demotic "none of your business". Privacy correlates with wealth. Money buys you secrecy, protection and (if you wish) a quiet life. If you are poor, privacy rarely exists outside the unintended byproduct of its evil twin, neglect. A "troubled" family that resists state intervention cannot plead that its apparently "chaotic" affairs are a private matter. Similarly, the claim, in respect of mass surveillance, that "if you have nothing to hide, you have nothing to fear" can only come from people confident that their own private affairs will not be the subject of official scrutiny - i.e. that financial corruption and sexual peccadilloes are not a priority for GCHQ even if they are for the press.

The standard (eurocentric) history of privacy holds that it arose around the Reformation - reflecting the spread of literacy, personal salvation and early capitalism - and finally emerges as a theorised feature of modernity in the second half of the nineteenth century following the shift from extended to nuclear families, the increase in personal possessions, and the civic normalisation of freedom of conscience. Key moments were the Mazzini Affair of 1844 in the UK and the US publication in 1890 of Warren and Brandeis' The right to Privacy. It's worth noting that this conceptualisation coincides with the development of income tax, and in particular the evolution of the tax from an exceptional demand to fund war to a standing obligation to fund public services. The modern concept of privacy was a reaction to the pressures of industrial society, but it was also an attempt to restrain democracy by extending to personality the right to mark property as "off limits".

Though the conventional history acknowledges the material impact of capitalism on the mass of people, it has little to say about changing sentiment among the rich. The characters in the early-nineteenth century novels of Austen and Balzac talk openly about their own and others' wealth (a fact that Thomas Piketty put to good use in his Capital in the Twenty-First Century). In their milieu, the limited "public" of the pre-democratic age, the possession of property and money was relatively transparent and scruples over its origin outside that milieu were few. Over the course of the century, the public discussion of wealth becomes infra dig not because money becomes morally problematic, a la Tolstoy, but because the public expands to include the mass of the people. Privacy reflects the growing self-consciousness of a wealthy elite previously oblivious to the servant class.

Coincidental to Cameron's plea for privacy, WhatsApp (owned by Facebook) has announced end-to-end encryption for its messaging service, noting that "Privacy and security is in our DNA". There is a lot of ideology at work in that phrase. In the context of a communications system, security is traditionally defined by three features: availability (the system is up), integrity (communications can't be interfered with) and confidentiality (messages won't go beyond intended recipients). Increasingly, the term is coming to mean the protection of assets mediated by the system rather than the system itself: your documents and photos are "secure" in the cloud, you can "securely" transfer money, all your data will be automatically backed-up etc.

Likewise, privacy is spun as preventing your assets "from falling into the wrong hands", which we all know means the state as much as nebulous "bad guys" engaged in online fraud. Thus the protection of the expressions of personality (free speech) is used to justify the protection of property more generally: an ironic inversion of the approach of Warren and Brandeis. This reflects the desire to create value in digital property that is intrinsically value-less because it can be replicated at zero cost. Of course, your intellectual property is worthless: the precedent is being established for the benefit of others, which is why the idea of biological determinism is more than a fashionable metaphor. The suggestion is both that privacy is a natural state - when the history of the subject (not to mention anthropology more generally) shows that it is anything but - and a genetic characteristic, i.e. possessed to a different degree by different people.

In a blog post, Jan Koum, one of the founders of WhatsApp, put it in a political context: "The desire to protect people's private communication is one of the core beliefs we have at WhatsApp, and for me, it's personal. I grew up in the USSR during communist rule and the fact that people couldn't speak freely is one of the reasons my family moved to the United States". Like Apple's "love of our country", this is an appeal based on the idea of a higher loyalty - to free speech and constitutional rights - that justifies the defiance of government. I'm sure there is a degree of sincerity in this claim (ideology is nothing if not sincere), but it should be obvious that what is driving the move to implement end-to-end encryption is customer preference. Online privacy has become a product differentiator, much as secrecy in respect of tax-dodging and money-laundering is the only rationale for tax-havens and ease of access to those havens is the USP of the UK.


  1. Herbie Causes Extinction6 April 2016 at 19:03

    The main political thrust of this is that we do not have a debt problem as such, but a problem of wealth concentration and lack of real democracy, because the legal system allows the elites to put their money 'offshore' in order that they can avoid contributing to the general level of public utility. And what democracy would ever enact that into law? None is the answer, only a system bought off the by wealthy and powerful would result in this.

    Nothing in capitalism reflects the democratic will, in one way or another it always reflects the will of the wealthy and powerful. Every else is just coincidence.

    When George Osborne claims the nation has no money, we can say this is because all the money is offshore.

    There is no need for a revolution to change this, a genuine left opposition would ensure we could make such offshoring illegal. This would bring it's own problems but at least then we can deal with the fundamental problem.

    It is interesting looking at the US and noticing that Obama passed the trade deal with panama in 2011, and at the time Bernie Sanders explained this deal was being put together for one main reason, to allow the rich to offshore their funds. As Obama said to the rich at the time, "Yes You Can!"

  2. Cameron's class position was exemplified better by the "put up or shut up" last night - the modern equivalent of "how dare you" - and everybody knows that a punter couldn't say the same to HMRC and expect to get away with it.

    And does he really think that anybody will seriously believe that all he has to his name is his salary, house and "a few savings"?

    A lot of people would have had more respect for his "private matter" comment but, as you say, they've also heard the "if you have nothing to hide, you have nothing to fear" line. In a lot of senses, this sums up a lot of chickens coming home to roast at once. Cameron, like the PR man that he is, is often fast with the rhetoric, but slow with the action. Those contradictions mount up in the end.