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Roger Clarke's 'National Security Costs'

The Costs of 'National Security' to Privacy, and to Business

Roger Clarke **

Notes of 23 November 2006

For an Invited Presentation at the Australian Information Security Association's Annual Seminar, Sydney, 24 November 2006

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Under the pretext of 'the war against terror', reactionary Governments in the USA, Australia and some European countries have been imposing many additional and enhanced 'security' measures. These have included more widespread and stronger identity authentication, 'know your customer' requirements, greatly increased transaction monitoring, visual and electronic surveillance, multiple attempts to impose a national identification scheme, a passport incorporating whatever biometrics the public servants of the day can bluff through their Minister, and agency-authorised access powers with little or no judicial oversight.

The reduction in civil rights is unprecedented, exceeding even those imposed during the darkest hour of threat of invasion by the Japanese in the midst of WWII.

But the extremist agenda also imposes costs on business. One aspect is financial burden, as demands for changes in business processes force re-design and re-programming. And time-consuming manual authentication measures are being imposed by government agencies, as they outsource to business, without recompense. Another major concern is the deflection of executive focus and managerial and operational effort away from the real business of business. New forms of bureaucracy are emerging, resulting in new barriers to the streamlining of business processes along value chains.

A further serious threat is of harm to relationships between corporations on the one hand and their customers and suppliers on the other. The 100-point check was welcomed by banks, because it greatly raised switching costs, reduced customer churn, and enabled unconscionable pricing and profitability to be sustained. But with all of that has come yet more cynicism by consumers about banks. In sectors that have less tight rein on their customers, companies can expect faster churn and higher costs of customer acquisition and maintenance.


My many papers on these topics are indexed here.

Author Affiliations

Roger Clarke is Principal of Xamax Consultancy Pty Ltd, Canberra. He is also a Visiting Professor in the Cyberspace Law & Policy Centre at the University of N.S.W., a Visiting Professor in the E-Commerce Programme at the University of Hong Kong, and a Visiting Professor in the Department of Computer Science at the Australian National University.

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Created: 7 November 2006 - Last Amended: 23 November 2006 by Roger Clarke - Site Last Verified: 15 February 2009
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