Encryption is Vital to the Net

                           BY RICHARD A. GEPHARDT

      THE  Clinton  administration's recent call for a "non-regulatory,
      market-oriented" approach to promoting Internet commerce includes
      many  constructive initiatives. However, if we are to realize the
      full potential of the Internet, we must  also  end  the  outdated
      restrictions on U.S.  exports of encryption products.

      Encryption,  which  encodes  electronic  messages  so that only a
      recipient with the ability to decode the message can read it,  is
      vital  to  the  future of Internet commerce. It prevents crime by
      keeping hackers from reading your e-mail or stooling your  credit
      card  numbers.  It helps companies protect trade secrets. As more
      information flows over the  open  networks  that  constitute  the
      Internet,  people  increasingly  need  encryption  to  keep their
      information secure.

      Because encryption is  not  restricted  domestically,  you  would
      think  American  companies  would  be  global  leaders  in  world
      markets. But often they aren't allowed to compete.   Fearing  the
      availability  of  encryption  abroad could make it more difficult
      for the U.S.   government  to  intercept  the  communications  of
      criminals   and   gather   intelligence,  the  current  and  past
      Administrations have chosen to maintain strict export controls on
      encryption.  The level of encryption U.S. companies are permitted
      to export is now so weak that a college hacker can  break  it  in
      less than four hours.

      If export controls could keep encryption from criminals, controls
      would make sense. But U.S. self-restraint has  simply  encouraged
      foreign  producers  of  strong encryption, who are not covered by
      export limits, to fill the vacuum. Hundreds of strong  encryption
      products,  many  developed  in  countries  like  Canada, Ireland,
      Germany and Russia, are increasingly available  abroad.   And  as
      foreign competitors use their advantage in encryption to win more
      high-tech sales, we lose jobs.

      The National Research Council's blue-ribbon panel  on  encryption
      policy  recently warned that "foreign competition could emerge at
      a level significant enough to  damage  the  present  U.S.   world
      leadership"   in   the  software  industry.   Such  damage  could
      jeopardize hundreds of thousands of high-paying jobs.   It  could
      also  undermine  our national security, according to the Council,
      by making it harder for the U.S. government to  keep  abreast  of
      evolving  encryption  technology  in  the  future.   The  Council
      endorsed a relaxation of export controls in order to maintain the
      U.S. lead in this vital sector.

      The  Administration  has  proposed  a  "key  recovery"  system to
      require users to make available to  governments  the  "keys"'  to
      decode  their  private  communications.   But  giving governments
      worldwide ready access to individuals' private information and to
      corporate  secrets  raises  difficult  issues.   Will U.S.  firms
      operating in China be forced to trust that  government  with  the
      keys  to  their  trade  secrets? Will human rights groups abroad,
      where U.S. constitutional protections do not apply, be forced  to
      give  authoritarian  governments  the  keys  to  their membership
      lists? Can we really expect criminals to give up  their  keys  so
      that they may be made available to the government?

      Key  recovery  won't  work unless the many countries that produce
      encryption adopt it.   Otherwise  criminals  could  still  obtain
      encryption  from  non-complying  countries.   But  countries like
      Germany have refused to support key recovery. Indeed, they have a
      strong economic incentive to resist. As long as the international
      disagreements persist and we hog-tie our industry,  their's  will
      enjoy an advantage in world markets.

      The  National  Research Council urged a balanced approach to this
      problem:  improve security on the Internet and prevent  crime  by
      relaxing exports controls and allowing U.S. exporters to meet the
      competition.  Maintain robust  controls  against  rogue  nations.
      Impose  penalties  for  misusing  encryption to commit crime. And
      invest  in  additional  technical  capabilities   to   help   our
      intelligence agencies adjust to the information age.

      Led  by  Members like Congresswoman Zoe Lofgren, D-San Jose, more
      than  250   Democrats   and   Republicans   in   the   House   of
      Representatives  --  myself included -- have joined in support of
      the Security and Freedom through Encryption (SAFE) bill to  relax
      export  controls  and  advance many of the recommendations of the
      National Research Council.

      With growing support, the SAFE  bill  makes  it  clear  that  the
      Congress  will  not  tolerate  the  continued  shackling  of  our
      high-tech sector. We are  willing  to  work  with  all  sides  to
      develop  a consensus on a workable, market-oriented approach that
      can advance our law enforcement interests and  win  international
      acceptance.   But  we  aren't willing to simply watch the current
      stalemate continue and keep U.S. industry on the sidelines. It is
      time  to  move  forward and modernize our export policies for the
      information age.

      Rep. Richard A. Gephardt, D-Mo., is the House Democratic leader.