Reprinted from Truthdig
Excerpt from "They Know Everything About You: How Data-Collecting Corporations and Snooping Government Agencies Are Destroying Democracy"(Nation Books, February 2015).
For years, the outsourcing of defense and intelligence work was, with good reason, controversial in political circles. But in the last years of Bill Clinton's administration, the president authorized the CIA's creation of the first US government-sponsored venture capital firm, In-Q-Tel, designed to invest in cutting-edge Silicon Valley companies. The firm, named after Ian Fleming's fictional character "Q," who masterminds James Bond's spy gadgets, was founded on September 29, 1999, when the intelligence agencies came to realize they couldn't produce the technology required to make sense of the vast amount of data they had acquired.
The firm's mission is to "identify, adapt, and deliver innovative technology solutions to support the missions of the Central Intelligence Agency and broader US community." This process provided a way of tapping the resources and creativity of Silicon Valley -- which undoubtedly had gained a technological edge over government in the post-Cold War period -- without the burden of trying to directly recruit the free spirits of Palo Alto into government bureaucracy.
Under the guise of In-Q-Tel, the CIA has invested in hundreds of start-ups, including a company called Keyhole, whose satellite mapping software became Google Earth. In-Q-Tel proved immensely successful in its first five years, bringing revenue into the agency and, more significantly, allowing it to discreetly co-opt technologies and companies that would exponentially enhance its spying capabilities without causing the public to ever raise an eyebrow.
The practice of tapping tech companies for government work, then, began to shed its taboo and appear increasingly attractive to other governmental entities. For example, NASA and the US Army, inspired by the success of In-Q-Tel, are currently planning to develop their own venture capital firms in its image. Thanks in part to In-Q-Tel, the already substantial for-profit investment in the intelligence area was expanded significantly under President George W. Bush, such that it constituted about 70 percent of the intelligence budget by 2007.