In December of 2015, 230,000 people in Western Ukraine lost power after 30 substations were mysteriously shut off. Contrary to what most people assumed at the time, this wasn’t an innocuous power outage. The authorities would later admit that the loss of power was caused by a cyber attack, which marked the first time that malware was successfully used to attack a power grid. A similar, albeit more sophisticated cyber attack, occurred one year later just outside of Kiev. Given the current tensions between Russia and Ukraine, it’s widely believed that the Russian government was responsible for these incidents.
However, there’s more to this story than meets the eye. A computer security company has been investigating these attacks, and has discovered the malware that was used to take down the grid. They’ve found that it’s far more dangerous and easier to use than anyone realized before.
The danger of the malware is that it can automatically trip the breakers within a power system that keep the electrical lines from being overloaded. If one breaker is tripped, the load is shipped to another portion of the power grid. If enough are tripped, in the right places, it’s possible to create a cascading effect that will eventually overload the entire system, said Weatherford, who was formerly the chief security officer at the North American Electric Reliability Corporation, the regulatory authority for North American utilities.“In some cases, it could then take days to restart all the plants,” he said.Two things stand out about the malware, dubbed “Industroyer” by the researchers — it’s an order of magnitude easier to use than previous programs and it wasn’t actually deployed to do any real damage, meaning whoever’s behind the December attack might simply have been testing the waters.
In other words, this malware can induce what’s often referred to as a cascading failure. This is what caused the massive blackout that occurred in the Northeastern US and Canada back in 2003. An overgrown tree branch in Ohio touched a power line, which caused that section of the grid to overload and shut down. The electricity had to be transferred to other power lines, which in turn also became overloaded. This chain reaction continued until 55 million people were without power.
Cascading failure is the perfect example of just how fragile our power grid can be.
Because our grid is so interconnected, something really small can have a huge effect on the wider system. Though the power grid in the US isn’t as vulnerable to humble tree branches as it used to be, it’s still quite vulnerable to the type of malware that was used to shut down parts of the grid in Ukraine.
This “Industroyer” malware represents a new threat that people need to accept and prepare for. The power grid, which is the linchpin of our standard of living, is now vulnerable to software that is relatively easy to use. Though it seems likely that the Russian government was responsible for developing it, it could have just as easily been made and deployed by non-state actors on a shoe string budget.
This is a dangerous new reality that we live in. Now, someone with a modest education and a small budget can inflict billions of dollars in damages, and leave us all in the dark. Obviously, that makes widespread blackouts far more likely in the future.
And that potential is probably just the tip of the iceberg. It’s very possible that multiple cyber-attacks could keep us in the dark for weeks rather than just days. That would be more than long enough to cause society to disintegrate.
The attacks on physical cash from a phalanx of economists, central bankers, commercial banks, and politicians have not diminished in recent years. On the contrary, in the face of the worldwide increase in terror attacks, particularly in Europe, and ongoing pressure on public budgets, the cash ban issue is increasingly dragged into the spotlight.
In a highly-recommended study entitled “Cash, Freedom and Crime. Use and Impact of Cash in a World Going Digital,” Deutsche Bank Research demolishes numerous popular myths surrounding cash, inter alia in the context of crime and terrorism.
Without cash there are no longer bank robberies at gun point, instead there are now electronic bank robberies. Fraud involving credit cards and ATM cards is massively increasing in Sweden, the country considered the pioneer of the cashless society.
The argument that adopting a cashless payment system would facilitate the fight against terrorism doesn't hold water either:
As regards terrorism in Europe, an analysis of 40 jihadist attacks in the past 20 years shows that most funding came from delinquents’ own funds and 75% of the attacks cost in total less than USD 10,000 to carry out — sums that will hardly raise suspicions even if paid by card.
Legislators have passed additional regulations in the past 12 months which at least restrict the use of cash; bans of high-denomination banknotes (e.g., the 500 euro note) and (lower) thresholds for legal cash payments. There are however also technological developments that are significantly reducing the transaction costs of cashless payments and are therefore making cash comparatively unattractive.
In Sweden, an app called “Swish” introduced by the country's leading banks has revolutionized cashless payments. To this point, the app has been downloaded 5.5 million times. In the Scandinavian country only 2% of all payments are settled in cash these days.
Sweden's central bank expects that this percentage will decline by another three-quarters to 0.5% by the end of the decade. 900 of the 1,600 bank branch offices in the country no longer have any cash in store.
The academic debate continues unabated. A paper that has recently triggered intense debate is the IMF working paper “The Macroeconomics of De-Cashing,” which was published in March 2017. Its author Alexei Kireyev examines the possible macroeconomic consequences of abolishing cash. His central conclusions are:
- A cashless payment system would make the monetary policy transmission mechanism more efficient, as there would be very little or no cash available anymore. In particular, it would become possible to implement negative interest rates on a broad front, in order to boost consumption.
- Since a decline in cash holdings would go hand in hand with an increase in demand deposits at banks, the banking sector would be able to extend more loans. That would lower the level of interest rates and boost economic growth.
- A sudden increase in the demand for cash is a sign of an imminently impending financial crisis. Shortly before the collapse of Lehman Brothers in September 2008, demand for cash currency increased significantly. That was a sign that bank customers increasingly lost confidence in the solvency and liquidity of commercial banks. This warning signal would no longer be available if cash were abolished.
- A cashless economy makes tax collection easier, as the example of Sweden illustrates.
Regardless of a superficially balanced approach in large parts of the text, the article clearly evinces an underlying bias toward supporting the abolition of cash. Several arguments in the paper are fallacious and represent little more than intellectual kowtowing to the prevailing zeitgeist. Thus a cashless economy is supposedly going to improve “financial inclusiveness” — as every citizen and economic actor would be forced to open a bank account; it would reduce illegal immigration — as employment of illegal immigrants would become more difficult; and it would help protect the environment — because the production of paper or polymers for banknotes has a greater impact on the environment than electronic money.
Whether the given objective of fighting crime and black markets can be realized by banning cash remains a highly controversial issue. Thus, Professor Friedrich Schneider, one of the most renowned experts in the areas shadow economy and tax evasion, shows that a cash ban would reduce illicit employment be a mere 10% and organized crime by less than 5%.
The paper's conclusions ultimately read like a political manual for the abolition of cash by means of salami tactics.
In other words, to prevent the population from getting alarmed, it is to be weaned off cash in tolerable doses through a piecemeal approach. Economic incentives for cashless payments are to be put in place, i.e., specifically, fees for cash payments are supposed to be introduced or raised. In our assessment, the most important point though concerns the notion that “de-cashing” would be “critical for the efficiency” of a negative interest rate policy.
President Assad inspects Russian weapons systems at the Hmeimim air base in western Syria.
Shortly after Washington warned Damascus against any more chemical attacks and stressed that Russia and Iran would also be held to account, Syrian ruler Bashar Assad’s visit to the Russian Hmeimim Air Base in Latakia on Tuesday, June 27, bears striking symbolic, if not provocative, significance.
Their guest from Damascus was shown around the base by the commanders of Russian forces in Syria and allowed a close look at the warplanes and attack helicopters lined up for his perusal. Indeed, as DEBKAfile’s military sources show in the series of attached photographs, Assad had his picture taken while sitting in the cockpit of a Russian fighter jet and while he was closely examining Russian S-400 and S-300 air defense missile batteries.
Not all the photos showed the base neatly prepared for a formal visit. A group of Russian troops were seen in a variety of work clothes standing untidily around some of the weapons systems, indicating that Assad’s visit was improvised in a hurry as an attempt to show that Moscow and Damascus were as tight as ever and ready together to repel any American attack on Syrian military targets.
Officials at Gettysburg National Military Park are bracing for a raucous week of protests as the park prepares to commemorate the 134th anniversary of the battle July 1- July 3.
Two pro-heritage groups have received permits to gather in order to mark the sacrifices of their ancestors during the battle. But social media is full of other calls for demonstrations, specifically from the anarchist group Antifa which plans to burn Confederate flags and desecrate grave stones.
Lawhon said the park is working with the U.S. Park Police, the Pennsylvania State Police, and local law enforcement to keep order during the weekend.
“Our goal is to ensure that public safety and visitor safety is number one and that park resources are preserved,” she said.
Besides the two permitted protests, Civil War reenactors from the Maryland Sons of Confederate Veterans also received a permit for a “site specific” march starting at 10 a.m. from the North Carolina Memorial to the Veterans Memorial, where they will hold a ceremony, Lawhon said. Another popular private reenactment festival is also scheduled about two miles from the park, she said.
Reports that the anti-fascist group Antifa plans to burn Confederate flags and desecrate graves have prompted calls on social media for other groups to gather in Gettysburg to counter those protesters.
The anniversary of the battle, which raged from July 1 to July 3, 1863, comes at a time when there is a growing movement to remove Confederate symbols from public spaces.
I don't know if I'm just past the point of outrage that nothing the left does angers me anymore, but reading this just fills me with an intense sadness. If there is one place in the U.S. that should represent a healing of our divisions during the most trying times in American history, it is Gettysburg. Besmirching that history — spitting on its legacy by desecrating graves — might be predictable from Antifa. But that doesn't make it any less depressing.
More troubling than that is the disruption protest groups will cause. If you've ever been to Gettysburg and walked the battlefield, you are aware of the quiet and how even just the sound of an exuberant child can be unwanted and intrusive. It doesn't sound like there will be much silent contemplation at Gettysburg over the next few days.
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