Strong Encryption and Transaction Taxes

["Gar W. Lipow" <lipowg@xxxxxxxxxxxxxx>]

I've always favored Doug Henwood's position on
strong transaction taxes on bets placed in the
global and national casinos.

But as a tech type, I've also kind of reflexively
opposed the restrictions on strong encryption.
You know, when secret codes are outlawed only
outlaws...  (In case one or two lurkers are
unfamiliar with strong encryption, you can think
of it as a secret code you can use which the
government cannot break.  Since everybody already
knows how to do this, restrictions on such
encryption are pretty futile. And the assumptions
that your right to privacy stops existing when it
becomes practical to enforce has always appalled
me. [Sub note: strong encryption may not be as
unbreakable as was thought until recently. But I
still have not heard of anyone breaking a 1 meg
key with parallel computing.])

 I've always assumed there was no contradiction
here. If you have a transaction tax, and you think
someone is using encryption to evade it, get a
court order and make them cough up the key. If
they "lose" the key or openly refuse to turn it
over,  treat them as you would a suspected
violator who shreds or burns files.

However, I'm a lot more familiar with computer
technology than I am with the process of
investigating tax evasion -- especially by large
corporations and very rich individuals. Is it as
simple as I make it sound, or does strong
encryption pose a problem here?

Gar W. Lipow
lipowg@xxxxxxxxxxxxxx
815 Dundee Rd NW
Olympia, WA 98502
Phone 360-943-1529