Internet laws do more harm than good

The low returns from any legislation involving the internet should be a warning that laws against so-called “cyberbullying” are likely to do more harm than good.

The Law Commission, a previously serious body, has become so enmeshed in “feel-good” stuff that it threatens to be consigned to irrelevance.

The attempt to control abuse of alcoholism with a set of draconian laws was bad enough. Then there were proposals to impose further restrictions on the media through a proposed Communications (New Media Bill) (pdf).

Now there is a 160-page ministerial briefing outlining ways to combat “harmful digital communications” (pdf), aka “cyberbullying.”

So you don’t have to wade through these, or bother with any arguments I might put forward, the case against is put succinctly by Council for Civil Liberties member Thomas Beagle in this NBR ONLINE op-ed.

Among other things, Beagle observes, "It is proposed to make something illegal on the internet that wouldn't be illegal if it was published in some other way. Does it really make sense that the same message might be legal on a billboard in the middle of Auckland but illegal if it was then posted to the Trademe Forums?"

And to summarise his view, Beagle concludes:

"All in all, we view this proposed new law with suspicion and fear that it will limit freedom of expression and cause more problems than it solves."

Exactly. It should also be noted that claims made in this area are highly dubious, greatly exaggerated and self-serving.

Statistics New Zealand's site Stats Chats has exposed how Netsafe, an organisation that will greatly benefit from any regulation under any new laws, uses gullible journalists and fear-mongering to further its cause.

Auckland biostatistics professor Thomas Lumley uses a Stuff story to show how this is done. It starts with this claim:

The amount of money Kiwis lost to online dating scams has doubled in the past year and now makes up almost two-thirds of all reported online fraud losses.

It is then revealed Netsafe based its claim on self-reporting at its website. In other words, Professor Lumley says,

…it’s not a doubling of cybercrime, it’s a doubling of cyber-reporting. A bogus poll, in other words.

The Stuff story goes on:

The charity [Netsafe] claimed in June that cyber-crime cost the country “as much as $625 million” in financial losses once the time and expense in sorting issues, such as removing malware, was included.

Professor Lumley: If we simultaneously believed the $625 million and believed that the ‘two-thirds’ from online dating scams was meaningful, that would be $400 million per year from online dating scams, which is ludicrous.  So at least one of these figures is bogus. In fact, they both probably are.

The economics of spam
Meanwhile, a Wall Street Journal blog has exposed the economics of spam, which has already generated a raft mainly useless and costly laws.

The blog is based on an article in the academic publication Journal of Economic Perspectives. In summary, it finds the costs of combating or dealing with spam outweigh the benefits to the offenders by a whopping 100 to one.

This is based on estimated costs of $US20 billion a year in the US from time wasted from deleting it and the costs of software that stop all but about 3% of the 50 billion pieces sent out each day.

The amount of revenue this spam pulls in is estimated at $US200 million annually.

This 100:1 ratio compares, for example, with the study authors’ calculations of the cost to society of car theft verses returns to thieves – somewhere between 7:1 and 30:1.

The authors, Justin Rao and David Reily (who were both working at Yahoo! Research when they wrote the article), suggest two practical ways to combat the spam industry: take more aggressive action against the banks that process money made by spammers (usually a handful of banks in obscure places) or hit the spammers with millions of fake orders, thus raising the costs of doing their illegal business.   

Brazil goes private
Funny that Brazil, which will host the next Football World Cup and the 2016 Olympics, should be turning to widespread privatisation and a huge infrastructure programme to stop its emerging major economic power status from stalling.

The BBC reports that more than $60 billion will be invested in that country's roads and railways over the next 25 years, with more than half in the next five years. Ports and airports will follow.

Brazil has tried the currency devaluation path and cut interest rates – but those didn’t work. It also allowed credit expansion in a hoped for lift in consumer spending.

But the real problem has been Custo Brasil or the Brazil Cost – state-backed impositions that have created expensive energy, poor infrastructure and increasing labour costs.

Growth in Brazil is predicted to be less than 2% this year, the weakest annual performance since 2009 and a sharp slowdown from an impressive 7.5% rise in 2010.

The key to unlock its state-dominated economy will be privatising about 14,000km of railways and roads. The privatisation of ports, lower energy costs and incentives for industry will soon follow.

Three of Brazil’s largest airports have already been privatised – an analysis is in this Privatisation Barometer report (pdf) – as part of a plan to improve overstretched facilities before the World Cup in just two years’ time.

Geothermal could save fracking
An interesting upheaval is likely to occur in the environmental lobby, and it might just start with the grenade lobbed this week from erstwhile minister of conservation, Nick Smith.

While he has been yellow-carded over the still-mysterious ACC affair, Mr Smith has sided with the rationalists over fracking and other high-tech mining techniques. (If you haven’t read it, his widely published op-ed is here.)

Matthew Hooton has suggested Mr Smith as the new energy czar when he eventually returns to the cabinet. But more interesting is that the religious campaign against fracking (or more technically, hydraulic fracturing) could yet collapse when it taps renewable geothermal energy.

Geothermal power used to be about finding and retrieving existing hot water to generate power – but fracking technology allows water to be sent into deep fissures for heating and subsequent retrieval.

This means geothermal power can be tapped just about anywhere, not just in existing thermal fields.

But the Greens are not without support. One project in Oregon that aims to use fracking to tap geothermal power has been frustrated – the story and much background on the techniques can be read here – but should it go ahead and prove successful, then the anti-frackers may disappear pretty quick.