What It Is & What It Does

The Clipper Chip is significant because it was the United States' first attempt to create an encryption standard using key escrow.  However, since its introduction, the mandatory implementation of the Clipper Chip was found unconstitutional by the United States Supreme Court.  Key escrow is still a major issue in current legislation that has evolved from the introduction of the Clipper Chip.

The Clipper Chip was introduced by the Clinton Administration on April 16, 1993.  The U.S. Government recognized the importance of security for businesses, industries, and citizens.  However, criminal activities are also feared to be better facilitated through the use of encryption, which is why the Clipper Chip contained a back door to allow law enforcement agencies to decode any voice or data encrypted message.  The keys to the Clipper Chip would have been escrowed to the National Institute of Standards & Technology and to the Automated Systems division of the Department of theTreasury.  Both of these agencies are located in the executive branch of the federal government.  A law enforcement agency could tap a phone line that used the Clipper Chip to encrypt messages by presenting a warrant to both agencies which would then release the proper key.

How It Evolved

Most encryption research this century has been done by the National Security Agency.  However, in the 1970s, mathematicians became much more involved in creating and breaking codes.  Since this was seen as a threat, the NSA set restrictions on the production of encryption algorithms and their level of power.  This severely limited the research capabilities of the National Science Foundation.

In 1974, IBM introduced an encryption chip called the "Lucifer Chip", which originally used a 128-bit key.  However, the NSA prohibited such a powerful chip and limited the key to 56 bits, reducing the chip's capabilities by several million.  The chip was still powerful enough for industry use, however, it was still breakable by the NSA.

Lucifer became the Data Encryption Standard (DES) and was used by government and industries to encrypt confidential telephone calls.  DES lost its effectiveness by 1993 as computers became more powerful and were able to break DES code.

Skipjack, which became known as the Clipper Chip, was developed by the NSA in response to the rising technology.  It used an 80-bit key and was 16 million times more powerful than DES.  Clipper Chips, if implemented, are meant to be installed into telephones, fax machines, and modems, relying on the Escrowed Encryption Standard. A variation of the Clipper Chip, called Capstone, would be installed onto computer to encrypt files.

Support for the Clipper Chip

Wiretapping is currently one of the more reliable uses of evidence in a court case.  On a yearly basis, it is estimated that about 2,000 arrests are attributed to wiretapping, of which 50% end up in convictions.  Supporters of the Clipper Chip and key escrow fear that encryption without the ability to eavesdrop by law enforcement agencies will allow criminals to engage in countless numbers of illegal transactions without the risk of getting caught.

Supporters do not fear as much possible federal abuse of its power to wiretap, as it is regulated by the 1968 Omnibus Crime & Safe Streets Act.  This law allows wire tapping only for serious crimes, including murder, kidnapping, bribery, narcotics, etc.  The Electronic Communications PrivacyAct of 1986 extended the 1968 act to include the wiretapping of on-line computer transmission of information.

Abuse is prevented through the extensive process required to obtain a warrant to wiretap.  A law agent must first show probable cause that a line is being abused for a serious crime.  A government attorney must then petition for a court order.  The application must then be approved by a federal or state judge.  The law agent can then proceed to the phone company and present the warrant.

It should be noted that statistically, an application is rarely denied.  Only 11 were denied of the 7200 applications presented between 1978 and 1988.

Opponents of the Clipper Chip

Many argue that the Clipper Chip would have had little effect on crime.  Most criminals would not even use the Clipper Chip, since its use is still voluntary. Criminals can obtain weaker but effective encryption chips that are produced overseas or domestically.  Currently, there are over 200 alternatives to the Clipper Chip.  The Pretty Good Privacy software package is one of these alternatives, which only works on data.  However, it utilizes the RSA algorithm, which is the strongest non-government algorithm available.  The greatest advantage to this software package is that it is free for download.  The company MIT, which has been responsible for the distribution of PGP, has been distributing PGPfone since 1996.  PGPfone is a software package that converts a computer into a secure telephone.  To learn more about PGPfone, click HERE.  To download Pretty Good Privacy, which will allow secure electronic exchanges, click HERE.

Also, with enough technical know how, a user of the Clipper Chip can scramble the part of the transmission that identifies to law enforcement which key to use.

Wiretapping may lose its resourcefulness as it becomes more and more expensive.  Currently, the average cost of a wiretap is already $45,000.  New technologies will only make wiretapping more difficult and therefore more expensive.  Wiretapping for the use of catching criminals loses its economic incentives as it becomes more expensive.

The Clipper Chip also hurts international busines due to key escrow.  Roughly two-thirds of the encryption industry works through export.  International consumers are unlikely to use escrowed encryption from the United States with the threat of eavesdropping.

The U.S. is also limited from developing innovative products through the use of classified algorithms, making the U.S. less competitive on a global scale.  Software would become much more expensive if each product required the implementation of a Clipper Chip.  Consumers will tend to trade speed and security to obtain an affordable product and the implementation of the Clipper Chip inhibits this.

Many Americans fear the abuses of power inherent in the federal bureaucracy.  The fact that both keys would be kept by federal agencies that are both located in the executive branch leads to further paranoia.  Since the encryption algorithm of the Clipper Chip is classified, it is also impossible to determine how effective and secure the algorithm really is.

Conclusion

The government has every reason for promoting research to develop better encryption devices and to establish standards.  However, the reason the Clipper Chip was not widely embraced was that it required government controlled key escrow.  Most did not trust the government with this power, especially since both keys would be located within the executive branch.  This made the Clipper Chip ineffective because many capable alternatives existed that could be used not only by industry and consumers, but also by criminals.  If the government had wanted industry, business, and consumers to adopt the Clipper Chip as its standard, its only choice was to make its use mandatory.  However, this is impossible because the Supreme Court ruled that to do this is unconstitutional.  If the government is unwilling to abandon key escrow, it should at least locate the keys in separate branches to limit abuse.  Many still favor private key escrow, which is still a highly debated issue today.
 

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