Blowback: Covert Surveillance and the Consequences for Global Economic Growth

BY CHRIS PAWLIK — Trade matters. The security interests of the United States are inexorably tied to its interest in promoting free trade and open markets. During the summer of 2013 discussions for the most significant American-involve trade pact since NAFTA, Transatlantic Trade and Investment Partnership (TTIP) began. Only a few days before the first round of TTIP negotiations began, the first Snowden leaks start to appear. Now the effects of those leaks are beginning to materialize.

Lawmakers around the world have begun reacting to the leaks of NSA whistleblower Edward Snowden. Dilma Rouseff, Brazil’s President, has announced that all federal officials will be required to use a government-created encrypted email system by mid-2014. [1] President Rouseff also announced the development of a similar encrypted email system for use by Brazilian citizens. [2] As a result, Brazil has decided not to renew its contract with Microsoft for the use of the company’s Outlook program. [3] However, the United States appears on course to be hardest hit by the European Union, as the civil liberties and justice committee of the European Parliament recently voted with overwhelming support as to a set of draft rules that would strengthen member states citizen’s personal electronic communications. [4] The draft rules would require American companies that are not based in European Union member states but who provide information and data services within European Union member states to obtain permission to transfer and store any such gathered information in the United States. [5]

On the other hand, United States policymaking appears disinclined toward any move that would tighten personal data protection. Senators Dianne Feinstein (D-CA) and Saxby Chambliss (R-GA), both members of the Senator Select Intelligence Committee, are trying to reintroduce a bill known as the Cyber Intelligence Sharing and Protection Act (CISPA). [6] While CISPA passed a House vote in March 2013, the Senate did not vote on the bill and the White House threatened to veto the House version of the bill. [7] CISPA would essentially make it easier for corporations to share information they collect with the government. Strong supports of CISPA include General Keith Alexander, Director of the NSA. [8]

If the European Parliament passes a final version of the civil liberties and justice committee’s draft rules, the consequences for businesses operating on either side of the Atlantic would be immense. Divergent data privacy laws in the United States and the European Union would force a dilemma on not only tech companies, but on any corporation that shares and collects data pertaining to its operations. I call this the corporate data dilemma. The dilemma is simple; a corporation is forced to share its data with government A in violation of government B’s data sharing laws. One need not look very hard to see how an order of the FISA Court might conflict with a future law of the European Union.

In the coming months, United States officials will be increasingly hard pressed to address the growing blowback from the leaks of NSA whistleblower Edward Snowden as outrage continues to grow among American allies. American participation in the second round of TTIP has already been stalled once due to the 16-day government shutdown. [9] While talk of postponing the TIPP negotiations was briefly entertained by some European officials in the early days of the Snowden’s leaks, more recent revelations such as wiretapping German Chancellor Angela Merkel’s telephone—who brushed aside any discussion of delaying TTIP negotiations—might undermine the progress of the talks. [10]  While resolving trade disputes over the buying and selling of commodities is a step forward to strengthening the global economy, it is information based services and products that are the true engine of growth within a modern economy. However, growth cannot occur if corporations on both sides of the Atlantic are placed in precarious situations by lawmakers. That being said, the TTIP negotiations might do well to be the first address the looming shadow on the wall.


Due to developments in late October 2013 the article focusing on the legality of NSA intelligence gathering has been postponed until November 2013.





[5] Id.







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