What is the Clipper Chip Initiative?

11900 Metric Blvd J-181
Austin Texas 78758-3117
(512) 837-9345

The following was published in the June 1994 issue of HAL PC Journal. This is dated material. Some statements may not be up to date.

Encryption is a method of scrambling messages and files to keep them private. Governments and corporations have used encryption from time immemorial, but recently strong encryption has become available to individuals. Phil Zimmermann's freeware program Pretty Good Privacy (PGP) (available almost anywhere) provides a convenient way for individuals to encrypt and decrypt messages and files. Voice scramblers have existed for a long time, but in the past, analog scramblers were not cryptographically strong. That is, if a government or a corporation really wanted to overhear your scrambled speech, it could do so. Now, technology has advanced to the point that strong encryption of voice communications is becoming feasible at a price which will be affordable for the masses.

The Clipper Chip Initiative is the "Escrowed Encryption Standard" which has been proposed as a standard for encrypted voice communications by the National Institute of Standards and Technology (NIST). This as a standard for a hardware chip which was designed by the National Security Agency (NSA) for NIST. This design was probably done illegally because the Computer Security Act of 1987 explicitly gives NIST the responsibility for standards-making for the unclassified governmental and commercial sectors. In NSA internal documents, the chip was originally called the "trapdoor" chip.

The plan features "key escrow," an arrangement whereby the government keeps the keys to decrypt all the information encrypted by any of the chips and then promises not to use them without legal authorization.

The administration plans to implement the Clipper proposal entirely using authority that it believes it already has. It does not plan to get Congress to pass any new laws in implementing the Clipper standard. This is why the proposal is called the "Clipper Chip Initiative" rather than the "Clipper Chip Act". This is necessary because it is not clear that any Clipper proposal could pass Congressional muster. Last year the "Digital Telephony Act" went down in flames when it could not find even one Congress-person willing to sponsor it. (The "Digital Telephony Act" is the FBI's proposal to have the phone companies tap everyone's phone for the FBI with the cost being born by the people that pay phone bills. Of course, the FBI promises not to use this ability to record phone conversations without a proper court order.)

The Clipper Chip is Bad Business.

The Clipper Chip is a bad business decision for several reasons:

The Clipper Chip is not likely to become an Industry Standard in the sense of being widely used. It has been opposed by many respected industry leaders such as Lotus' CEO Jim Manzi, WordPerfect CEO Adrian Rietveid, Microsoft's Bill Gates, Ray Noorda of Novell, Carol Bartz of Autodesk, Aldus CEO Paul Brainerd, and Intergraph's Jim Meadlock, to name just a few. With this kind of opposition, it is not likely that the proposed standard will gain wide acceptance.
There are many situations in which it is legitimate and legal to keep secrets from the government. For example, while negotiating with the IRS or regulatory agencies, you are entitled to privacy while you are communicating with your lawyer. However, if you are not able to make the required privacy a reality, you may be at a disadvantage when dealing with these agencies. Of course, you have the government's promise that it will never use its escrowed keys without proper authorization, but many people prefer not to rely on promises.
The Clipper Chip renders you vulnerable to industrial espionage. To understand this, consider the hundreds of "drug war" investigations in progress across the country. If the Clipper were to become widely used by the targets of these investigations, it would be necessary to obtain the "escrow keys" for the suspects of these investigations and those of the people that they habitually call. Thus, there would be long lists of "escrow keys" that would have to be obtained for these investigations. An industrial spy could obtain an "escrow key" for a clipper device used by the competitor by bribing someone to add the key to one of these long lists. The key could then decrypt his competitor's communications. While many in law enforcement would refuse to participate in such a scheme, it only takes one person who is susceptible to a bribe to make this plan work. "And who is so firm as can not be seduced?" The intelligence agencies will say that their compartmentalization is such as to prevent this from happening. But compartmentalization did not prevent Aldrich Ames from passing to the Russians many secrets which he theoretically could not have even known.
John Gilmore's Freedom of Information Act request may force the government to release all of the "escrowed" keys rendering all Clipper Chips worthless. To see how this is so, it is well to remember that the government plans to implement its Clipper proposal without passing any new laws. Since the government did not attempt to introduce any new laws, there was no opportunity to adjust the Freedom of Information Act with respect to the Clipper Chip. The Freedom of Information Act does not include any exemptions for secret government databases containing Clipper Chip keys. If the government were to classify these databases, then it would become illegal to distribute the classified information to law enforcement officers, most of whom do not have the required clearance. John Gilmore has previously won Freedom of Information Act cases relating to cryptography, so there is a good prospect that he will win this one as well. If this should happen all Clipper Chip keys would be exposed.
The industry is likely to create a viable alternative to Clipper which does not have Clipper's deficiencies. Phil Zimmermann, the author of Pretty Good Privacy, is working on a voice encryption system using sound cards and a software implementation. There will probably soon be hardware systems coming to market that feature Public Key encryption. Systems that can be used internationally will probably come from abroad, as the administration is choking domestic encryption products with its inane "munitions export control laws."

Political Analysis

Why does the Clinton Administration support the Clipper Chip Initiative at the same time that the supposedly "right wing" Rush Limbaugh opposes it? Do not most ACLU members vote Democratic? Is it not supposed to be the "right-wingers" that want to limit our civil liberties? Is down up? Is up down? Are dogs and cats going to start living together? What can explain this astounding political reversal? It is possible to account for Rush's position. Rush has been forced to take an interest in First Amendment issues because of the proposed revival of the "Fairness Act" which has been viewed as covert way to flush Rush. Also, Rush is a Republican. The Democrats control both the Legislative and Executive branches of government. The Clipper Chip Initiative proposes to increase government power in a way that could be used against Republicans. Certainly, it would be more difficult for Rush to oppose the Clipper Chip if George Bush was still proposing it. It is more difficult to explain the position of the Clinton Administration. Al Gore likes to talk about the administration's proposals for the Information Superhighway, but he seems very uncomfortable when discussing the Clipper Chip. A standard whose sole raison d'etre is to enable the government to tap everyone's phones seems positively Nixonesqe. Politicians may pay lip-service to civil liberties when addressing the ACLU, but their own true agenda is their own personal power and advancement. As government continues to demand more and more control over people's lives, more draconian methods must be used to meet resistance. The Democratic Party's nominal support for civil liberties may be only "boob bait for the Bubbas" in the inspiring words of Senator Daniel Patrick Moynihan.

There is another possible explanation for the position of the Clinton administration. The intelligence agencies like to tap people's phones, but they also love to bug people's bedrooms. Perhaps the Clinton administration finds itself in a position in which it has no choice but to agree to the requests of the intelligence agencies.