Opening Statement of Rep. Billy Tauzin (R-LA) (excerpts). Hearing of the House Telecommunications Subcommittee. Re: HR 850, SAFE Act. Date: May 25, 1999. Source: This document was created by Tech Law Journal by transcribing from an audio recording of the hearing. The audio recording was of poor quality, and hence, there may be errors in this transcription. All but several inaudible sentences and phrases are transcribed below.

[We have a] very large, but extraordinarily intelligent and informed panel for our subcommittee, as we begin thinking in advance of -- about how we plan to enter the world -- the world where more and more digital -- a highly encrypted age. We have learned over the past few years that encryption is playing an integral role in the development of the digital economy. Individual consumers are looking for certainty and trust when they operate online. The business community wants to integrate encryption into their products, and into their daily practices. ...

Encryption is becoming the modern day door lock. It literally is the deadbolt of the next millennium. Unfortunately, for all the benefits of encryption, there is a down side. For every legitimate company and person that uses an encryption product, there is a good chance that the product can be used for illegal purposes as well. As complex and mathematically dynamic as they become, encryption products do not discriminate. ... Thus, the encryption product used to protect the transfer of the new fashion designs from Miami to New York can also be used by terrorists to protect clients for the next attack on innocent civilians.

The Clinton administration's and previous administrations' report have treated encryption products guardedly. They see the potentially harmful effects that encryption products, and want to keep these products from being used without proper cause, and without proper approval. It would be more accurate -- the administration's encryption policy reflects diverging purposes. On the one hand, the administration, led by the intelligence community, wants to contain U.S. encryption products from being used abroad. And more often, and  interfering with their ability to conduct intelligence gathering. On the other hand, the law enforcement community wants to manipulate the design of encryption products to ensure that they can obtain access to the encrypted material, as needed, with proper authorization.

The current policy, based on good and proper intentions, is a failure. I believe that it is impossible to contain the use of encryption products. In fact, the only encryption products we are containing are American products from being used internationally. The world economy is now interdependent. The digital economy is even more dependent on interacting, communicating, and conducting business globally. Instead of recognizing this fact, our containment strategy has put ankle bracelets on American companies. We expect them to try to compete, and put a roadblock in the way.

I am glad to see that we have a foreign encryption producer here today to talk about international treatment of encryption, and how their business is going.

The law enforcement community makes a stronger case for their position, but it too does not survive scrutiny. If they were successful, U.S. encryption products would dominate the world. They would continue a vital component that allows for the decryption and sensitive material in command of ____. In their view, the faster acceptable American encryption products were created and used the better. Unfortunately, this position ignores some very simple facts.

Backdoor recoverable mechanisms cannot be forced on current encryption manufacturers. In some market segments, recoverable products, to be successful in others, it will not. In the meantime, the benefits of encryption are delayed or prevented from reaching the needed user. Our law enforcement community cannot force foreign producers, in fact, to build recoverable products.

I am reminded of an analogy told by ____, technology company on the subject of encryption. I am asked whether they would -- they could build recoverable products. You said it is you asking the creators of the atomic bomb to develop a mechanism to put the world back together if it turns out that it should not have been detonated. Or, it is like asking a farmer to put the egg back together after it has been cooked, eaten, and digested.

So I come from the perspective that there are two truths about the debate over encryption products. One. We are unsuccessfully hamstringing U.S. encryption producers and those that want to incorporate encryption into their products, based on false pretenses. Two. The only way that current policy is going to change is for Congress to take action.

The administration likes to play both sides of the issue. When it looks as though the political pressure is too hot and they makes slight changes in policy. They modified their policy late last year to provide relief for certain market segments. But what happens if you are not in one of those targeted segments? The simple answer is you are out of luck. And this is no longer acceptable. That is why I am a supporter and cosponsor of HR 850. 850 would relax ____ restrictions to import -- permit export of encryption of any strength without being recoverable.

I would be remiss if I did not point out that while H 850 is a step in the right direction, the bill is missing certain concepts. The Commerce Committee did a great job, I think, on the development of encryption high-tech laboratories to promote cooperation and the sharing of knowledge between law enforcement and the encryption producing communities. It is our hope that this concept will be continued.

In addition, when encryption products have the ability to protect and secure today's communications networks, telecommunications network and the Internet, in ways that are necessary, especially as the dependency of these networks on foreign networks increases. With our jurisdiction over commerce generally, and our expertise in communications policy specifically, I hope that we will take the necessary time to improve this bill, before, to reflect this aspect of the debate.

I should add parenthetically, as you all know, the 9th Circuit has entered into this debate. The 9th Circuit has generally declared the export ban on encryption products to be unconstitutional on the theory that encryption is in fact a part of free speech. Without encrypted products, our free speech in this country, and around the world, would not adequately be protected, as the Constitution envisioned. In that regard, the administration faces the prospect of a decision on whether to appeal that decision.

I will be joining with a number of members in a letter to the administration urging them not to appeal the 9th Circuit decision, rather to work with us on this Committee, and in the Congress, to pass 850, with, as I said, with the work of this Committee perfecting it in the process. And I would urge members to consider joining me in that request to the administration, to join us in this legislative effort, rather than to pursue long extended appeals of the 9th Circuit decision to the Supreme Court.

I look forward to hearing the witnesses today, and recognize now the ranking minority member from Massachusetts, my good friend, Mr. Markey.