Had His Start Been Fifteen Minutes Longer He Would Not Have Been Caught.

The relation between George W. Bush and Reality is indeed beyond satire.

“Computer Genius,” $7.1 Billion Fraud

The New York Times is reporting that a fraud by a single employee has cost the French bank Société Générale 4.9 billion euros. The fraud was committed by a trader in charge of “plain vanilla” hedging on European index futures.

The trader’s actions were found to be a case of “isolated fraud,” the bank said, and officials said they were convinced the trader had acted alone.

Speaking at an afternoon press conference, Christian Noyer, governor of the French central bank, the Bank of France, described the trader as a computer “genius.”

“I am totally serene,” Mr. Noyer said. “I wouldn’t be if the bank wasn’t in a very solid situation...

Mr. Noyer also said the fraud had shown that new measures would have to be introduced to prevent a repeat and that the central bank would begin an investigation...

Howard Lutnick, chief executive of Cantor Fitzgerald, said that if one trader had managed to undertake fraud on this scale it revealed bigger weakness in the risk management system of the bank...

It does seem that the bank's serenity could use a bit of worry about its risk management procedures and controls.

It also appears that Jérôme Kerviel has set a new world record for financial trading fraud.

In 1995, Nick Leeson, a trader in Singapore, incurred a loss of $1.8 billion by making $27 billion of bad bets on Japanese markets, bringing down the venerable British bank, Barings, in the process.

In 1998, Yasuo Hamanaka, once the chief copper trader at the Sumitomo Corporation, was sentenced to eight years in prison after pleading guilty to hiding $2.6 billion in trading losses.

John Kerry on Swiftboating

I don't normally quote extensively from political email, but one from John Kerry struck a chord with me.

From: John Kerry
Sent: Tuesday, January 22, 2008 4:28 PM
Subject: Swiftboating
Dear James,

... I support Barack Obama because he doesn't seek to perfect the politics of Swiftboating -- he seeks to end it.

This is personal for me, and for a whole lot of Americans who lived through the 2004 election.

As a veteran, it disgusts me that the Swift Boats we loved while we were in uniform on the Mekong Delta have been rendered, in Karl Rove's twisted politics, an ugly verb meaning to lie about someone's character just to win an election.

But as someone who cares about winning this election and changing the country I love, I know it's not enough to complain about a past we can't change when our challenge is to win the future -- which is why we must stop the Swiftboating, stop the push-polling, stop the front groups, and stop the email chain smears.

The truth matters, but how you fight the lies matters even more. We must be determined never again to lose any election to a lie.

This year, the attacks are already starting. Some of you may have heard about the disgusting lies about Barack Obama that are being circulated by email. These attacks smear Barack's Christian faith and deep patriotism, and they distort his record of more than two decades of public service. They are nothing short of "Swiftboat" style anonymous attacks.

These are the same tactics the right has used again and again, and as we've learned, these attacks, no matter how bogus, can spread and take root if they go unchecked. But not this time -- we're fighting back.

And when I say "we," I mean that literally. I know Barack is committed to fighting every smear every time. He'll fight hard and stand up for the truth. But he can't do it alone.

We need you to email the truth to your address books. Print it out and post it at work. Talk to your neighbors. Call your local radio station. Write a letter to the editor. If lies can be spread virally, let's prove to the cynics that the truth can be every bit as persuasive as it is powerful.

The Obama campaign has created a place where you can find the truth you'll need to push back on these smears...

Take action here:
http://my.barackobama.com/factcheckaction

So when your inbox fills up with trash and the emails of smear and fear, find the facts, and help defeat the lies...

... To win the chance to change America, we must first defeat the hateful tactics that have been used to tear us apart for too long...

The fight is just heating up -- we won't let them steal this election with lies and distortions.

Thank you,

John Kerry

They lied, and lied, and lied.

And then they lied some more.

The Center for Public Integrity has assembled a database of false public statements about the case for war in Iraq made by top officials of the Bush administration. Still infuriating reading.

Future Science: What the budget squabblers ignore.

An excellent op-ed piece by Craig Barrett (the Chairman of Intel) in the San Francisco Chronicle discusses the shortsightedness of recent Congressional (in)action on science matters, particularly the recent "budget deal" and the immigration brouhaha.

... All parties agreed that our competitiveness in the 21st century was at stake and we needed to act.

So much for political will.

The recent budget deal between Republicans and Democrats effectively flat-funds or cuts funding for key science agencies...

The funding decisions on the America Competes Act took place a few days after Congress passed a $250 billion farm bill. In the eyes of our political leaders, apparently, corn subsidies to Iowa farmers are more important for our competitiveness in the next century than investing a few billion in our major research universities. The president expressed his happiness with the budget and Sen. Harry Reid, the Senate Majority Leader, said, "The president didn't get his priorities, we got ours." ...

Hello, politicians, anybody there? Nancy Pelosi, Harry Reid, Barack Obama, Hillary Clinton, John Edwards, where are you when the country needs you?

Science Debate 2008

Paul McJones drew my attention to the Science Debate 2008 page, which is a call for a Presidential debate on science and technology:

Given the many urgent scientific and technological challenges facing America and the rest of the world, the increasing need for accurate scientific information in political decision making, and the vital role scientific innovation plays in spurring economic growth and competitiveness, we call for a public debate in which the U.S. presidential candidates share their views on the issues of The Environment, Health and Medicine, and Science and Technology Policy.

The list of backers is impressive (even without counting me :-). There also appears to be some connection to National Public Radio.

I've been "sold" again.

Three years ago, I was preparing for the announced sale of McAfee Research to SPARTA, Inc. Today, Cobham plc announced an agreement to buy SPARTA, Inc., for $416 million in cash. SPARTA's board has recommended acceptance of the agreement by SPARTA's employee-shareholders. Subject to regulatory approvals and a shareholder vote, the transaction should close in April or May, and SPARTA will become a fully-owned subsidiary of Cobham.

I had no previous knowledge of Cobham, and have no inside information on their goals and plans for SPARTA, beyond what's in their announcement. I don't expect substantial changes in the short term.

New Hampshire Recounts Requested

ComputerWorld has an article by Todd R. Weiss about recounts of both major-party primary ballots requested (and being paid for) by two minor candidates (Kucinich and Howard). Fortunately, there are paper ballots to be recounted.

On Wednesday, a volunteer with e-voting watchdog group Black Box Voting posted a note on the group's blog alleging that election results in the town of Sutton initially gave candidate Ron Paul zero votes but that the total was later corrected to 31 votes. The mistake was attributed to human error by someone who left the 31 votes off a final tally sheet, the blog stated.

David Bright, a national staff member for the Kucinich campaign, said that incident is one example of why a full recount is needed. Bright said the unreported votes initially were noticed by a Sutton family of five voters who insisted they had voted for Paul, even though the unofficial tally sheet showed zero votes.

Additionally, he said, the statewide vote percentages for primary front-runners Hillary Clinton and Barack Obama "never changed all night, no matter how many precincts came in," and that in all towns where ballots were hand-tallied, Obama won, while in all towns with votes counted by optical-scanning machines, Clinton won.

The issue, Bright said, is that elections have to be accurate, and that voters need to be able to trust the systems used. The problem, he said, is that far too many questions are being asked about the integrity, security and accuracy of the e-voting systems used across the nation.

"With all the talk about whether the election system is good enough or not, this is a good place to start," Bright said. "This has got to be done before November" when the general election will be held.

Kucinich is raising the issue, Bright said, even though he finished a distant fifth in the New Hampshire primary... The Kucinich campaign wants to be a "catalyst" for mandating more accurate elections and for making a process that can be trusted, Bright said. "Nobody else is standing up for it," he said. "Everybody else is brain-dead on this. This is a matter that's crucial to America. Everybody is talking about it, and nobody is doing anything about it." ...

Chris Riggall, a spokesman for Premier Election Solutions Inc. of Allen, Texas, the makers of the e-voting optical scanning machines used in New Hampshire, said his company would welcome a recount.

"We think that any post-election audit ... including a recount of that, naturally, is great because we feel it's going to confirm what the machine counts showed," Riggall said. "If that goes forward, we'd be very pleased to see that happen. We're extremely confident" of the previously reported results."

Big Brother Really is Watching.

According to an article in ComputerWorld, by Robert L. Mitchell, the Department of Homeland Security (DHS) Project Hostile Intent is "deadly serious" about making this a reality.

Sharla Rausch, director of the DHS's human factors division, says the agency is already seeing positive results. In a controlled lab setting, she says, accuracy rates are in the range of 78 to 81%. The tests are still producing too many false positives, however. "In an operational setting, we need to be at a higher level than that," Rausch says, and she's confident that results will improve. At this point, though, it's still unclear how well the systems will work in real-world settings...

By combining the results for all of these modalities, the DHS hopes to improve the overall predictive accuracy rate beyond what the polygraph -- or any other means of testing an individual indicator -- can deliver.

That's not a very high bar. The validity of polygraphs has long been questioned by scientists, and despite decades of research and refinements, the results of lie-detector tests remain inadmissible in court. While the U.S. Department of Defense's Defense Academy for Credibility Assessment (DACA; formerly the Polygraph Institute) puts median accuracy percentage for polygraphs in the mid-80s when properly administered, others say that number is closer to 50% in the real world and that the results depend heavily on the skills of the examiner.

Schneier goes even further. He says lie detectors rely on "fake technology" that works only in the movies. They remain on the scene, he says, because people want them to work...

The TSA's passenger screening technology hasn't changed since the magnetometer, a metal detector, was introduced in 1973, but it's working on other technologies...

"We are not going to catch any terrorists, but a lot of innocent people, especially racial and ethnic minorities, are going to be trapped in a web of suspicion," says Barry Steinhardt, director of the Technology and Liberty Project at the American Civil Liberties Union in Washington.

But Steinhardt isn't really worried. He says Project Hostile Intent is just the latest in a long string of expensive and failed initiatives at the DHS and the TSA. "I've done hundreds of interviews about these [airline-passenger screening] schemes," he says. "They never work." Steinhardt adds that "hundreds of billions" of dollars have been wasted on such initiatives since 9/11. "Show me it works before [we] debate the civil liberties consequences," he says.

Given the DHS record on cybersecurity and other information technology issues--and the record of the US government in general--perhaps Steinhardt is right.

Should that S be an I?

Further confirmation for those who doubt that the US "Transportation Security Administration" really cares about your security: Information Week has an article by Thomas Claburn about a Congressional report on TSA's screw-up of its "Redress Management System."

Hundreds of Americans inappropriately placed on airline security watch lists and either banned from commercial air travel or subject to additional screening have also had to worry about identity theft for the past year. The Transportation Security Administration Web site set up to help innocent travelers clear their name has been deemed "insecure."

A report issued on Friday by the House Oversight and Government Reform Committee says that between October 6, 2006, when the TSA launched its Redress Management System [RMS] site, and February 13, 2007, when the site ceased operation following revelations about its lack of security, "at least 247 travelers submitted their personal information through the unsecured 'file your application online' link."

The report, prepared at the request of Chairman Henry Waxman, accuses the TSA of "poor procurement practices, conflicts of interest, and weak oversight." ...

According to a September 2007 report from the U.S. Department of Justice, that "43% of the names reported to the TSC [Terrorist Screening Center database] are false positives." The TSC database, maintained by the FBI, is the source for names on the government's No-Fly List.

"Well-known false positives include Senator Ted Kennedy, whose name was close to the name of a suspected terrorist, and Catherine Stevens, the wife of Senator Ted Stevens, whose name was similar to 'Cat' Stevens, the former name of the singer Yusuf Islam," the House report says.

Maybe it should be called the TIA, Transportation Insecurity Administration? No, wait a minute, TIA's the name of another government program that somehow got discontinued.

Ask the Expert: David Dill

Stanford's School of Engineering website has an "Ask the Expert" page posing to Prof. David Dill the question: "Will we be ready for electronic voting in 2008?"

Excerpts:

The role of computers in voting should be limited, because computers are fundamentally limited machines. Computers are so complex that we can’t tell whether they are working properly. Because of system errors and the possibility of tampering, we may never have a computerized voting system that we can deem completely trustworthy...

Imagine a voting system in which you walked into a booth and dictated your votes to a man hidden behind a curtain. The job of the man would be to write your votes down and put them into a ballot box. Without the ability to see the man (the curtain is not transparent) how could you be sure that he was writing down your votes accurately? How could you be sure that he really put your ballot into the ballot box so that it would be counted? All-electronic voting systems are just as lacking in transparency.

There is no way for the voter to verify that the vote was recorded properly or that it was stored for counting. The computer is just like the man behind the curtain. Software can programmed accidentally or intentionally to do the wrong thing. You can’t see what is happening inside the computer. It can even show you one vote while recording another...

WARNING:Your vote may be lost, destroyed, miscounted, wrongly attributed or hacked.

The cover story of today's New York Times Magazine is "Can You Count on These Machines?", by Clive Thompson. [free registration required to access]

It is a serious and non-sensationalist review of many of the issues surrounding direct-recording electronic (DRE) voting machines in American elections. The points made will be familiar to those who have read my earlier posts on evoting, but they are made in a very accessible manner that should be understandable by the average voter.

Some excerpts:

Jane Platten gestured, bleary-eyed, into the secure room filled with voting machines. It was 3 a.m. on Nov. 7, and she had been working for 22 hours straight. “I guess we’ve seen how technology can affect an election,” she said. The electronic voting machines in Cleveland were causing trouble again... She could only hope the machines had worked correctly...

In the last three election cycles, touch-screen machines have become one of the most mysterious and divisive elements in modern electoral politics. Introduced after the 2000 hanging-chad debacle, the machines were originally intended to add clarity to election results. But in hundreds of instances, the result has been precisely the opposite: they fail unpredictably, and in extremely strange ways; voters report that their choices “flip” from one candidate to another before their eyes; machines crash or begin to count backward; votes simply vanish...

It’s difficult to say how often votes have genuinely gone astray...

So what scares election observers is this: What happens if the next presidential election is extremely close and decided by a handful of votes cast on machines that crashed? Will voters accept a presidency decided by ballots that weren’t backed up on paper and existed only on a computer drive? And what if they don’t? ...

The 2000 election illustrated the cardinal rule of voting systems: if they produce ambiguous results, they are doomed to suspicion. The election is never settled in the mind of the public...

The upshot is a regulatory environment in which, effectively, no one assumes final responsibility for whether the machines function reliably. The vendors point to the federal and state governments, the federal agency points to the states, the states rely on the federal testing lab and the local officials are frequently hapless...

And on and on it goes. ES&S and Sarasota correctly point out that Jennings has no proof that a bug exists. Jennings correctly points out that her opponents have no proof a bug doesn’t exist. This is the ultimate political legacy of touch-screen voting machines and the privatization of voting machinery generally. When invisible, secretive software runs an election, it allows for endless mistrust and muttered accusations of conspiracy. The inscrutability of the software — combined with touch-screen machines’ well-documented history of weird behavior — allows critics to level almost any accusation against the machines and have it sound plausible...

The deep, ongoing consternation over touch-screen machines stems from something new: the unpredictability of computers. Computers do not merely produce errors; they produce errors of unforeseeable magnitude. Will people trust a system when they never know how big or small its next failure will be? ...

In the real world of those who conduct and observe voting machines, the realistic threat isn’t conspiracy. It’s unreliability, incompetence and sheer error...

That, in a nutshell, is what people crave in the highly partisan arena of modern American politics: an election that can be extremely close and yet regarded by all as fair. Not only must the losing candidate believe in the loss; the public has to believe in it, too...

Public crises of confidence in voting machines used to come along rarely, every few decades. But now every single election cycle seems to provoke a crisis, a thirst for a new technological fix. The troubles of voting machines may subside as optical scanning comes in, but they’re unlikely to ever go away.

Digitizing libraries is not simple.

"Inheritance and loss: A brief survey of Google Books," by Paul Duguid, in fi®st m¤ñd@¥ amusingly (and somewhat alarmingly) sketches and illustrates some of the problems and limitations of a project that the author nevertheless still admires.

Google Books takes books as a storehouse of wisdom to be opened up with new tools. They fail to see what librarians know: books can be obtuse, obdurate, even obnoxious things. As a group, they don’t submit equally to a standard shelf, a standard scanner, or a standard ontology. Nor are their constraints overcome by scraping the text and developing search algorithms. Such strategies can undoubtedly be helpful, but in trying to do away with fairly simple constraints (like volumes), these strategies underestimate how a book’s rigidities are often simultaneously resources deeply implicated in the ways in which authors and publishers sought to create the content, meaning, and significance that Google now seeks to liberate. Even with some of the best search and scanning technology in the world behind you, it is unwise to ignore the bookish character of books. More generally, transferring any complex communicative artifacts between generations of technology is always likely to be more problematic than automatic.

More reasons not to shop at Sears

Summarized by Brian Krebs of the Washington Post.

Sears is having a bit of a rough day with the privacy community.

The Top 10 Data Breaches of 2007

Interesting compilation at CSO.com, "The Resource for Security Executives."

Each breach is rated for

• Victims
• Class Action Outrage Scale (1 to 10 Lawyers)
• D'oh! Factor (1 to 5 Homers)

From invention to a billion-dollar industry

Bill Buxton has an interesting article in Business Week called "The Long Nose of Innovation."

Any technology that is going to have significant impact over the next 10 years is already at least 10 years old... Here's the message to be heeded: Innovation is not about alchemy. In fact, innovation is not about invention. An idea may well start with an invention, but the bulk of the work and creativity is in that idea's augmentation and refinement.