The New York Times has an epiphany
by digby
It seems to have finally dawned on the paper of record that this Wikileaks Witch hunt might not be such a hot idea after all:
The whistle-blowing Web site WikiLeaks has not been convicted of a crime. The Justice Department has not even pressed charges over its disclosure of confidential State Department communications. Nonetheless, the financial industry is trying to shut it down.
Visa, MasterCard and PayPal announced in the past few weeks that they would not process any transaction intended for WikiLeaks. Earlier this month, Bank of America decided to join the group, arguing that WikiLeaks may be doing things that are “inconsistent with our internal policies for processing payments.”
The Federal Reserve, the banking regulator, allows this. Like other companies, banks can choose whom they do business with. Refusing to open an account for some undesirable entity is seen as reasonable risk management. The government even requires banks to keep an eye out for some shady businesses — like drug dealing and money laundering — and refuse to do business with those who engage in them.
But a bank’s ability to block payments to a legal entity raises a troubling prospect. A handful of big banks could potentially bar any organization they disliked from the payments system, essentially cutting them off from the world economy.
All correct and obvious. One would think that a news organization would have found that to be just a little bit troubling the instant it heard about it and raised the alarm. But better late than never.
But they aren't all the way there yet:
The fact of the matter is that banks are not like any other business. They run the payments system. That is one of the main reasons that governments protect them from failure with explicit and implicit guarantees. This makes them look not too unlike other public utilities. A telecommunications company, for example, may not refuse phone or broadband service to an organization it dislikes, arguing that it amounts to risky business.
Let's not be naive here. The government has enlisted every kind of institution to block communications and capital flow for years and these institutions have raised nary a peep. They always have good "reasons," and there's every reason to believe they'll use their power to cover up their own secrets in the same way they use it on the government's behalf. When it comes to this sort of thing they operate in exactly the same way. It's nice that the NY Times is finally seeing the danger of granting this power willy nilly but it's pretty late in the game.
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