President Raises Piracy Issue In State Of The Union Address Just Days After Justice Department Brings Megaupload Copyright-Infringement Case; Overall Fraud Battle Will Expand, Obama Tells Nation
Speaking to the nation in his State of the Union address to Congress, President Obama last night referenced U.S. efforts to combat piracy. Although the remarks were in the context of battling knock-off goods that infringe trademarks and affect American manufacturing jobs, Obama delivered the message just days after the Justice Department brought racketeering and copyright-conspiracy charges in the Megaupload international piracy case — and the hacker’s group “Anonymous” retaliated by bringing DDoS attacks against government and other sites.
Megaupload principal Kim Dotcom yesterday was denied bail in New Zealand, the country in which he was arrested on U.S. charges that Megauplaod had amassed at least $175 million through international web piracy.
Obama referred to neither the Megaupload case nor the follow-up DDoS attacks. But the President did signal that the United States would not stand by idly and submit to the whims of pirates who seek to hide behind international borders and gorge themselves on profits derived from U.S. ingenuity.
“It’s not right when another country lets our movies, music, and software be pirated,” the President said.
Megaupload and related entities operated websites that caused at least $500 million in economic harm to U.S. companies by unlawfully reproducing and distributing “infringing copies of copyrighted works, including movies – often before their theatrical release – music, television programs, electronic books, and business and entertainment software on a massive scale,” the Justice Department said last week.
“The conspirators’ content hosting site, Megaupload.com, is advertised as having more than one billion visits to the site, more than 150 million registered users, 50 million daily visitors and accounting for four percent of the total traffic on the Internet,” the Justice Department said.
Law enforcement last week executed 20 search warrants in eight countries, including the United States. At least $50 million in assets and 18 domain names were seized, and servers in Canada, the Netherlands and the United States were targeted by investigators to freeze the fraud in its tracks, the Justice Department said.
Obama also signaled that his administration’s overall fraud crackdown will continue and the the United States would dial up efforts to bring financial criminals to justice. Congress, he said, should stiffen fraud penalties.
“We’ll also establish a Financial Crimes Unit of highly trained investigators to crack down on large-scale fraud and protect people’s investments,” Obama said. “Some financial firms violate major anti-fraud laws because there’s no real penalty for being a repeat offender. That’s bad for consumers, and it’s bad for the vast majority of bankers and financial service professionals who do the right thing. So pass legislation that makes the penalties for fraud count.
“And tonight, I’m asking my Attorney General to create a special unit of federal prosecutors and leading state attorney[s] general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis,” the President continued. “This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans.”
The word “fraud” appeared four times in a White House transcript of Obama’s speech. It did not appear at all in the Republican response, which was delivered by Indiana Gov. Mitch Daniels and questioned where the United States would get the money to pay for programs in an era of runaway budget deficits.
The government does too much meddling in business and engages in unrestrained spending, Daniels suggested.
“In three short years, an unprecedented explosion of spending, with borrowed money, has added trillions to an already unaffordable national debt. And yet the president has put us on a course to make it radically worse in the years ahead,” Daniels said, according to a CNN transcript.
“In word and deed, the president and his allies tell us that we just cannot handle ourselves in this complex, perilous world without their benevolent protection,” Daniels said. “Left to ourselves, we might pick the wrong health insurance, the wrong mortgage, the wrong school for our kids; why, unless they stop us, we might pick the wrong light bulb.
“A second view, which I’ll admit some Republicans also seem to hold, is that we Americans are no longer up to the job of self-government. We can’t do the simple math that proves the unaffordability of today’s safety net programs, or all the government we now have. We will fall for the con job that says we can just plow ahead and someone else will pick up the tab. We will allow ourselves to be pitted one against the other, blaming our neighbor for troubles worldwide trends or our own government has caused.”
A highlight of last night’s State of the Union address was an emotional appearance by Rep. Gabrielle Giffords in the House Chamber. Giffords was shot in an assassination attempt a year ago. Still in the process of recovering from her wounds at the hands of a deranged man with a gun, she is leaving the Congress.
U.S. District Judge John Roll was killed in the same attack, as were a nine-year-old girl, three senior citizens in their seventies and a 30-year-old Congressional aide engaged to be married.
Both sides agree that Giffords, who is married to an astronaut, is an American hero whose courage has set an example for all. Both sides also agree that politics in the United States has become polarizing
What neither side appears to agree on is how best to address polarization, kickstart the economy, regulate the U.S. markets and equip agencies to meet modern challenges, including the unique challenges of the Internet age.