Issues for small businesses

A couple of interesting articles in this morning’s Star Tribune.

Before I mention them, kudos to the headline writer at the StarTrib. “Florida next stop in now-scrambled Republican race”. Odd . . . I thought that the Republican race was well scrambled before “now”.

The first article describes an aging business owner’s decision to use an ESOP as a means of avoiding selling the business. It’s an interesting idea, although the real problem is finding someone to manage the company and that issue isn’t discussed. But I have a warm spot in my heart for ESOPs since there was one that was very good to me.

The second article discusses the issue of loans to small businesses. I was especially intrigued with “The Federal Reserve Bank of Minneapolis says it's aggressively studying the problem.” That’s nice, but this isn’t a new problem. How about actually doing something? I was curious about whether the decrease in lending was due to a decrease in demand or the financial institutions’ desire to play it safe, and there’s no conclusion here. But the example they give suggests that the finance industry is part of the problem.

SOPA / PIPA

First impressions often come from a name. Take the Patriot Act. How could anyone possibly criticize something that so obviously exists solely for the enhancement and protection of the most important principles of our country? Never mind that it strips privacy rights away from its citizens.

Enter the Stop Online Piracy Act (SOPA) and the Protect IP Act (PIPA). (There are two proposals because these days the Senate and House can’t even agree on what to name their work.)

Stopping piracy and protecting copyright are as high minded as motherhood and apple pie. Who could possibly have a problem with legislation to further these fine goals?

You don’t have to look long to find out. For example, and this is one of many examples, visit the Electronic Frontier Foundation website and you’ll see this explanation:

These bills are targeted at "rogue" websites that allow indiscriminate piracy, but use vague definitions that could include hosting websites such as Dropbox, MediaFire, and Rapidshare; sites that discuss piracy such as pirate-party.us, p2pnet, Torrent Freak, torproject.org, and ZeroPaid; as well as a broad range of sites for user-generated content, such as SoundCloud, Etsy, and Deviant Art. Had these bills been passed five or ten years ago, even YouTube might not exist today — in other words, the collateral damage from this legislation would be enormous.

There are already laws and procedures in place for taking down sites that violate the law. These acts would allow the Attorney General, and even individuals, to create a blacklist to censor sites when no court has found that they have infringed copyright or any other law.

I made the mistake of trying to do my civic duty and express my opinion to my Senators.

One of them hasn’t even bothered to respond.

The other sent me the boilerplate response for PIPA comments. Basically it said, “I am a co-sponsor of this fine piece of legislation, and if you’re opposing it, you must be a dirty thief and maybe even a hacker.”

Since the White House came out today against the current bills, I am afraid that Republicans will work even harder for their passage. I hope that better judgment will prevail.

I'm the frog

I was struck while reading an article in the Washington Post this morning that we’re being treated to the demonstration of what happens when you put a frog into cold water and heat the water to boiling . . . and we’re the frog.

I enjoy the convenience of today’s technology. When I buy gasoline, I insert my credit card into the reader at the pump and don’t have to walk into the store and pay. There’s a tiny side effect of that – the credit card company knows that I bought gasoline at that location. But I don’t much care; it’s not a particularly useful or sensitive fact and the company probably won’t share it anyway.

But slowly over the past few years the temperature of the water has been rising. My GPS-capable phone can tell me how to reach my destination, but it tells someone where I’ve been. My network-connected electric meter helps save energy but provides the company with a profile of my energy usage. I love the fact that Mayo knows every visit to my doctor and every drug that I take – that knowledge could save my life – but I’m not enthusiastic about it going public. My finance institutions have a very good idea of my preferences based on how I spend my money, and soon my TV will be reporting what I’m watching.

There are two trends here that are converging. First is the amount of information that is being collected about us – when I paid cash for my gasoline, no one knew where and when I purchased it. Second is the merging of all of this disparate data. I don’t much care if a firm knows where I bought my gasoline, but if one entity consolidates all the bits of information that are being collected about me, they know a lot.

So what? If I’ve got nothing to hide, why should I care? There’s this outmoded idea of privacy, much of which went away in the name of fighting terrorism. If the complete electronic dossier doesn’t exist then it won’t be abused. As it becomes more complete the probability for abuse increases.

Old technology gives insight into new technology

Usenet is one of the oldest parts of the Internet, reaching back to the misty beginnings of what would eventually become the Internet. These days it’s pretty much an abandoned backwater, inhabited by people who are there because they’ve been there for years. There are exceptions, but most of the boisterous discussions have quieted or disappeared completely.

Usenet remains unique as an example of free speech. Over the years there have been a few attempts to control it, but an unmoderated Usenet newsgroup remains the only place I know of where anyone can say anything. Since Usenet consists of thousands of servers located all over the world, each with their own copy of what has been submitted, it’s impossible to reach out and destroy what has been submitted. Add to that an archive of Usenet at Google and the silly thing that you said twenty years ago can come back to haunt you at any time.

Fast forward to today’s technology and today’s society.

Many of you know PostSecret. It’s an ongoing project where people submit a postcard containing a “secret”; these are then selected by the project’s founder and posted weekly on a web site. There are books, museum exhibits, and presence on Facebook and Twitter. The founder of the project decided that it would be a good idea to develop an application for smartphones that would allow anyone to submit a secret.

In other words, he decided to re-invent Usenet.

What happened next came as no great surprise to those of us who have watched the same scenario unfold on Usenet. “Free speech” is a term that many people use but few have actually experienced. When you create an environment where anyone can say anything, a tiny percentage of the community will do exactly that. Add to that the ability to submit pictures and you’ve sealed your fate. The PostSecret app was shut down this weekend.

How is it that thirty years ago Usenet flourished but the same concept is impossible today?

Usenet flourished when its user base was restricted. In the early days of the Internet, the only people who could use it were academics or associated with the government. In the beginning they were hardcore computer geeks; as more user-friendly software was developed the user base expanded to a relatively non-technical audience that benefited from the wide-ranging discussions. Even so, the community knew how to ignore material that deserved to be ignored. There were consequences to being disruptive – you could lose your access – so there were few people motivated to disrupt and even when they did they were largely ignored.

This is much different from a PostSecret smartphone application with 30,000 submissions a day from a huge population of people who have no disincentive to disrupt and who don’t understand the concept of ignoring what deserves to be ignored. Add to this a heightened awareness in the law enforcement community and you’ve got a powder keg waiting to explode. Be careful what you ask for; you might just get it.

The trail you leave on the Internet

There’s an article in the Washington Post with a headline of “As Web sites come and go, so too could the information you entrust them with”. In addition to the bad grammar, my first impression was “Tell me something that I don’t already know.” But I decided to give it a quick look.

Here’s the paragraph that struck me:

Consumers might find even bigger surprises when an entire business fails. Bookseller Borders this year auctioned its customer database, including purchase history, in bankruptcy court. Information about users on defunct gay youth site XY were put up for sale, too, until the Federal Trade Commission stepped in to prevent the sale.

Not a new moral of the story, but reinforcement of an old one: Don’t share any information that you wouldn’t want your mother/spouse/children/employer to see.