Terrific Salon.com piece by Andrew O’Hehir.

As Nobel-winning economist Joseph Stiglitz recently noted, census data reveals that men with high-school diplomas but without college degrees earn about 40 percent less today (in real terms) than they did in the 1970s. Obama didn’t do that; capitalism did.

Stiglitz concluded his essay on inequality – which argued that it was a political choice, rather than the inevitable result of macroeconomic forces – by writing that he saw us “entering a world divided not just between the haves and have-nots, but also between those countries that do nothing about it, and those that do. Some countries will be successful in creating shared prosperity — the only kind of prosperity that I believe is truly sustainable. Others will let inequality run amok.” Which kind of country do we live in?

As far as the US is concerned, you know the answer. And I don’t think the answer for the UK is much different.

“How long will it take us to understand”, asks O’Hehir,

that the entire neoliberal project – the puritanical mania for cutting taxes, cutting social services and cutting budget deficits that has dominated the Western world’s economy for more than 30 years – has been a disaster? And guess what, liberals: You don’t get to point the finger at Ronald Reagan, Maggie Thatcher and Milton Friedman and claim it was all their fault. The reformist center-left, whether it took the form of Bill Clinton and the “New Democrats,” Tony Blair and “New Labor” or the watered-down social-democratic parties of Europe, has enthusiastically rebranded itself as a servant of global capital. If you were genuinely surprised that the Obama administration loaded itself up with Wall Street insiders, or that it failed to punish anyone for the massive criminal scheme that resulted in the 2008 financial collapse, you haven’t been paying attention.

The thing is: inequality is not a bug in the neoliberal system — it’s a feature. It’s not a sign of a defect in the system, but an indication that it’s working perfectly/

Interesting essay by Bruce Schneier (who’s been on great form recently). He starts by observing that, once upon a time, there was no downside for Internet companies if they cooperated with the NSA — because nobody (least of all their users) would know. But Snowden changed all that.

The Snowden documents made it clear how much the NSA relies on corporations to eavesdrop on the Internet. The NSA didn’t build a massive Internet eavesdropping system from scratch. It noticed that the corporate world was already eavesdropping on every Internet user — surveillance is the business model of the Internet, after all — and simply got copies for itself.

Now, that secret ecosystem is breaking down.

Over the past few months, writes Schneier, the companies have woken up to the fact that the NSA is basically treating them as adversaries, and are responding as such.

In mid-October, it became public that the NSA was collecting e-mail address books and buddy lists from Internet users logging into different service providers. Yahoo, which didn’t encrypt those user connections by default, allowed the NSA to collect much more of its data than Google, which did. That same day, Yahoo announced that it would implement SSL encryption by default for all of its users. Two weeks later, when it became public that the NSA was collecting data on Google users by eavesdropping on the company’s trunk connections between its data centers, Google announced that it would encrypt those connections.

We recently learned that Yahoo fought a government order to turn over data. Lavabit fought its order as well. Apple is now tweaking the government. And we think better of those companies because of it.

Now Lavabit, which closed down its e-mail service rather than comply with the NSA’s request for the master keys that would compromise all of its customers, has teamed with Silent Circle to develop a secure e-mail standard that is resistant to these kinds of tactics.

All this is evidence of a promising start. But the real question is whether the Snowden revelations just point to a scandal, or represent a crisis (to use David Runciman’s distinction). Scandals happen all the time, and generally make little difference in the grand scheme of things. (Think of the phone-hacking business in the UK: it looked for a time like a crisis, but little significant change will result from it, despite all the hoo-hah, so it was really just a scandal.) Crises, on the other hand, lead to real changes. Is the realisation of the scale of comprehensive surveillance a crisis? Only time will tell.

A slide from an NSA briefing, courtesy of Edward Snowden.

Then, an explanation from the Washington Post.

The operation to infiltrate data links exploits a fundamental weakness in systems architecture. To guard against data loss and system slowdowns, Google and Yahoo maintain fortresslike data centers across four continents and connect them with thousands of miles of fiber-optic cable. Data move seamlessly around these globe-spanning “cloud” networks, which represent billions of dollars of investment.

For the data centers to operate effectively, they synchronize large volumes of information about account holders. Yahoo’s internal network, for example, sometimes transmits entire e-mail archives — years of messages and attachments — from one data center to another.

Tapping the Google and Yahoo clouds allows the NSA to intercept communications in real time and to take “a retrospective look at target activity,” according to one internal NSA document.

Note the smiley under the dotted arrow pointing at the GFE interface.

So, remind me again: why would you trust an American Internet company?

Very good FT column by Edward Luce. Behind a paywall, but this extract gives a flavour.

Mr Snowden has also forced us to confront the larger question of US power in a changing world. For all America’s military weight, hard power gets fewer bangs for its buck nowadays. The fate of a US-led world in the coming decades will probably not be decided by a military clash with another large power. It is more likely to be settled by the quality of America’s economy and democracy. For most people around the world who are older than 30, the US is still chiefly seen through those prisms. But, for a whole generation beneath them, it is coming to stand for Big Brother – and not necessarily a benign one. The damage to US soft power – and the weight it lends to those who want to nationalise data storage and balkanise the internet – should not be overlooked.

Why, then, does Mr Obama want to put Mr Snowden behind bars?

The question of Mr Snowden’s motives is secondary. He may be a criminal, or a saint. I suspect he had good reasons. At minimum he will pay for his sins with a lifetime of looking over his shoulder. In the meantime, the rest of us are far more educated than before about how much privacy we have lost and how rapidly. We are all Angela Merkel now.

Mr Obama is enraged and embarrassed by the hammer blows of one giant disclosure after another. But the fallout has given him the possibility of answering his own plea for greater accountability. Back in May, he issued a thinly coded cry for help to rein in the growing US shadow state. We should be grateful that Mr Snowden came forward.

An illuminating excerpt from the ‘justification’ used by the Metropolitan police when detaining David Miranda at Heathrow.

“We assess that Miranda is knowingly carrying material, the release of which would endanger people’s lives. Additionally the disclosure or threat of disclosure is designed to influence a government, and is made for the purpose of promoting a political or ideological cause. This therefore falls within the definition of terrorism and as such we request that the subject is examined under schedule 7.”

Welcome to Britain, home of the free. And to the laws framed by New Labour btw.