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mariacallous · 7 months

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Shortly before noon on Aug. 19, 2023, a Russian cruise missile sliced past the golden onion domes and squat apartment blocks of the Chernihiv skyline in northern Ukraine. The Iskander-K missile slammed into its target: the city’s drama theater, which was hosting a meeting of drone manufacturers at the time of the attack. More than 140 people were injured and seven killed. The youngest, 6-year-old Sofia Golynska, had been playing in a nearby park.

Fragments of the missile recovered by the Ukrainian armed forces and analyzed by Ukrainian researchers found numerous components made by U.S. manufacturers in the missile’s onboard navigation system, which enabled it to reach its target with devastating precision. In December, Ukraine’s state anti-corruption agency released an online database of the thousands of foreign-made components recovered from Russian weapons so far.

Russia’s struggle to produce the advanced semiconductors, electrical components, and machine tools needed to fuel its defense industrial base predates the current war and has left it reliant on imports even amid its estrangement from the West. So when Moscow launched its full-scale invasion of Ukraine in February 2022, major manufacturing countries from North America, Europe, and East Asia swiftly imposed export controls on a broad swath of items deemed critical for the Russian arms industry.

Russia quickly became the world’s most sanctioned country: Some 16,000 people and companies were subject to a patchwork of international sanctions and export control orders imposed by a coalition of 39 countries. Export restrictions were painted with such a broad brush that sunglasses, contact lenses, and false teeth were also swept up in the prohibitions. Even items manufactured overseas by foreign companies are prohibited from being sold to Russia if they are made with U.S. tools or software, under a regulation known as the foreign direct product rule.

But as the war reaches its two-year anniversary, export controls have failed to stem the flow of advanced electronics and machinery making their way into Russia as new and convoluted supply chains have been forged through third countries such as Kazakhstan, Turkey, and the United Arab Emirates, which are not party to the export control efforts. An investigation by Nikkei Asia found a tenfold increase in the export of semiconductors from China and Hong Kong to Russia in the immediate aftermath of the war—the majority of them from U.S. manufacturers.

“Life finds a way,” said a senior U.S. intelligence official, quoting the movie Jurassic Park. The official spoke on background to discuss Russia’s evasion of export controls.

Some of the weapons and components analyzed by investigators were likely stockpiled before the war. But widely available Russian trade data reveals a brisk business in imports. More than $1 billion worth of advanced semiconductors from U.S. and European manufacturers made their way into the country last year, according to classified Russian customs service data obtained by Bloomberg. A recent report by the Kyiv School of Economics found that imports of components considered critical for the battlefield had dipped by just 10 percent during the first 10 months of 2023, compared with prewar levels.

This has created a Kafkaesque scenario, the report notes, in which the Ukrainian army is doing battle with Western weapons against a Russian arsenal that also runs on Western components.

It is an obvious problem, well documented by numerous think tank and media reports, but one without an easy solution. Tracking illicit trade in items such as semiconductors is an exponentially greater challenge than monitoring shipments of conventional weapons. Around 1 trillion chips are produced every year. Found in credit cards, toasters, tanks, missile systems, and much, much more, they power the global economy as well as the Russian military. Cutting Russia out of the global supply chain for semiconductors is easier said than done.

“Both Russia and China, and basically all militaries, are using a large number of consumer electronic components in their systems,” said Chris Miller, the author of Chip War: The Fight for the World’s Most Critical Technology. “All of the world’s militaries rely on the same supply chain, which is the supply chain that primarily services consumer electronics.”

Export controls were once neatly tailored to keep specific items, such as nuclear technology, out of the hands of rogue states and terrorist groups. But as Washington vies for technological supremacy with Beijing while also seeking to contain Russia and Iran, it has increasingly used these trade restrictions to advance broader U.S. strategic objectives. For instance, the Biden administration has placed wide-ranging prohibitions on the export of advanced chips to China.

“At no point in history have export controls been more central to our collective security than right now,” Matthew Axelrod, the assistant secretary for export enforcement at the U.S. Commerce Department, said in a speech last September. U.S. National Security Advisor Jake Sullivan has described export controls as “a new strategic asset in the U.S. and allied toolkit.”

Russia’s ability to defy these restrictions doesn’t just have implications for the war in Ukraine. It also raises significant questions about the challenge ahead vis-à-vis China.

“The technological question becomes a key part of this story and whether or not we can restrict it from our adversaries,” said James Byrne, the director of open-source intelligence and analysis at the Royal United Services Institute, a British think tank.

In the Russian city of Izhevsk, home to the factory that manufactures Kalashnikov rifles, shopping malls are being converted into drone factories amid a surge in defense spending that has helped the country’s economy weather its Western estrangement. Arms manufacturers have been urged to work around the clock to feed the Russian war machine, while defense is set to account for one-third of the state budget this year.

“We have developed a concept to convert shopping centers—which, before the start of the SMO [special military operation], sold mainly the products of Western brands—to factories for assembly lines of types of domestic drones,” Alexander Zakharov, the chief designer of the Zala Aero drone company, said at a closed event in August 2022, according to the Russian business newspaper Vedomosti. “Special military operation” is what the Russian government calls its war on Ukraine. Zala Aero is a subsidiary of the Kalashnikov Concern that, along with Zakharov, was sanctioned by the United States last November.

Defense companies have bought at least three shopping malls in Izhevsk to be repurposed for the manufacture of drones, according to local media, including Lancet attack drones, which the British defense ministry described as one of the most effective new weapons that Russia introduced to the battlefield last year. Lancets, which cost about $35,000 to produce, wreaked havoc during Ukraine’s offensive last year and have been captured on video striking valuable Ukrainian tanks and parked MiG fighter jets.

Like a lot of Russia’s weapons systems, Lancets are filled with Western components. An analysis of images of the drones published in December by the Washington-based Institute for Science and International Security found that they contained several parts from U.S., Swiss, and Czech manufacturers, including image processing and analytical components that play a pivotal role in enabling the drones to reach their targets on the battlefield.

“The recurring appearance of these Western products in Russian drone systems shows a keen dependence on them for key capabilities in the drone systems,” the report notes. Lancets are not the only drones found to contain Western components. Almost all of the electronic components in the Iranian Shahed-136 drones, which Russia is now manufacturing with Iranian help to use in Ukraine, are of Western origin, a separate analysis published in November concluded.

Early in the war, the Royal United Services Institute analyzed 27 Russian military systems, including cruise missiles, electronic warfare complexes, and communications systems, and found that they contained at least 450 foreign-made components, revealing Russia’s dependence on imports.

One of the principal ways that Russia has evaded Western export controls has been through transshipment via third countries such as Turkey, the UAE, and neighboring states once part of the Soviet Union. Bloomberg reported last November that amid mounting Western pressure, the UAE had agreed to restrict the export of sensitive goods to Russia and that Turkey was considering a similar move. Kazakh officials announced a ban on the export of certain battlefield goods to Russia in October.

Suspected transshipment is often revealed by striking changes in trade patterns before and after the invasion. The Maldives, an island chain in the Indian Ocean that has no domestic semiconductor industry, shipped almost $54 million worth of U.S.-made semiconductors to Russia in the year after the invasion of Ukraine, Nikkei Asia reported last July.

Semiconductor supply chains often span several countries, with chips designed in one country and manufactured in another before being sold to a series of downstream distributors around the world. That makes it difficult for companies to know the ultimate end user of their products. This may seem odd—until you realize that this is the case for many everyday products that are sold around the world. “When Coca-Cola sells Coca-Cola, it doesn’t know where every bottle goes, and they don’t have systems to track where every bottle goes,” said Kevin Wolf, a former assistant secretary for export administration at the U.S. Commerce Department.

While a coalition of 39 countries, including the world’s major manufacturers of advanced electronics, imposed export restrictions on Russia, much of the rest of the world continues to trade freely with Moscow. Components manufactured in coalition countries will often begin their journey to Moscow’s weapons factories through a series of entirely legal transactions before ending up with a final distributor that takes them across the border into Russia. “It starts off as licit trade and ends up as illicit trade,” said a second senior U.S. intelligence official, who spoke on condition of anonymity.

The further items move down the supply chain, the less insight governments and companies have into their ultimate destination, although sudden changes in behavior of importers can offer a red flag. In his speech last September, Axelrod, the assistant secretary, used the example of a beauty salon that suddenly starts to import electronic components.

But the Grand Canyon of loopholes is China, which has stood by Moscow since the invasion. In the first days of the war, U.S. Commerce Secretary Gina Raimondo warned that Washington could shut down Chinese companies that ignored semiconductor export controls placed on Russia. Last October, 42 Chinese companies were added to export control lists—severely undercutting their ability to do business with U.S. companies—for supplying Russian defense manufacturers with U.S. chips.

But as the Biden administration carefully calibrates its China policy in a bid to keep a lid on escalating tensions, it has held off from taking Beijing to task. “I think the biggest issue is that we—the West—have been unwilling to put pressure on China that would get China to start enforcing some of these rules itself,” said Miller, the author of Chip Wars.

A spokesperson for the U.S. Commerce Department’s Bureau of Industry and Security (BIS) said: “Due to the restrictions imposed by the United States and key allies and partners, Russia has been left with no choice but to spend more, lower its ambitions for high-tech weaponry, build alliances with other international pariah states, and develop nefarious trade networks to covertly obtain the technologies it needs.

“We are deeply concerned regarding [Chinese] support for Russia’s defense industrial base. BIS has acted to add over 100 [China]-based entities to the Entity List for supporting Russia’s military industrial base and related activities.”

Export controls have typically focused on keeping specific U.S.-made goods out of the hands of adversaries, while economic and financial sanctions have served broader foreign-policy objectives of isolating rogue states and cauterizing the financing of terrorist groups and drug cartels. The use of sanctions as a national security tool grew in wake of the 9/11 attacks; in the intervening decades, companies, government agencies, and financial institutions have built up a wealth of experience in sanctions compliance. By contrast, the use of export controls for strategic ends is relatively novel, and compliance expertise is still in its infancy.

“It used to be that people like me could keep export controls and sanctions in one person’s head. The level of complexity for each area of law is so intense. I don’t know anyone who is truly an export control and sanctions expert,” Wolf said.

Export controls, experts say, are at best speed bumps designed to make it harder for Russia’s defense industrial base to procure Western components. They create “extra friction and pressure on the Russian economy,” said Daniel Fried, who as the State Department coordinator for sanctions policy helped craft U.S. sanctions on Russia after its annexation of Crimea in 2014. Russia is now paying 80 percent more to import semiconductors than it did before the war, according to forthcoming research by Miller, and the components it is able to acquire are often of dubious quality.

But although it may be more cumbersome and expensive, it’s a cost that Moscow has been willing to bear in its war on Ukraine.

Western components—and lots of them—will continue to be found in the weapons Russia uses on Ukraine’s battlefields for the duration of the war. “This problem is as old as export controls are,” said Jasper Helder, an expert on export controls and sanctions with the law firm Akin Gump. But there are ways to further plug the gaps.

Steeper penalties could incentivize U.S. companies to take a more proactive role in ensuring their products don’t wind up in the hands of the Russian military, said Elina Ribakova, a nonresident senior fellow at the Peterson Institute for International Economics. “At the moment, they’re not truly motivated,” she said.

Companies that run afoul of sanctions and the Foreign Corrupt Practices Act, a U.S. federal law that prohibits the payment of bribes, have been fined billions of dollars. Settlements of export control violations are often an order of magnitude smaller, according to recently published research.

In a speech last month, Axelrod said the United States would begin issuing steeper penalties for export control violations. “Build one case against one of the companies extremely well, put out a multibillion-dollar fine negotiation, and watch everybody else fall in line,” Ribakova said.

And then there’s the question of resources. BIS has an annual budget of just $200 million. “That’s like the cost of a few fighter jets. Come on,” said Raimondo, speaking at the Reagan National Defense Forum last December.

The agency’s core budget for export control has, adjusted for inflation, remained flat since 2010, while its workload has surged. Between 2014 and 2022, the volume of U.S. exports subject to licensing scrutiny increased by 126 percent, according to an agency spokesperson. A 2022 study of export control enforcement by the Center for Strategic and International Studies recommended a budget increase of $45 million annually, describing it as “one of the best opportunities available anywhere in U.S. national security.”

When it comes to enforcement, the bureau has about 150 officers across the country who work with law enforcement and conduct outreach to companies. The Commerce Department has also established a task force with the Justice Department to keep advanced technologies out of the hands of Russia, China, and Iran. “The U.S. has the most robust export enforcement on the planet,” Wolf said.

But compared with other law enforcement and national security agencies, the bureau’s budgets have not kept pace with its expanding mission. The Department of Homeland Security has more investigators in the city of Tampa, Florida, than BIS does across the entire country, Axelrod noted in his January speech.

On the other side, you have Russia, which is extremely motivated to acquire the critical technologies it needs to continue to prosecute its war. The Kremlin has tasked its intelligence agencies with finding ways around sanctions and export controls, U.S. Treasury Undersecretary Brian Nelson said in a speech last year. “We are not talking about a profit-seeking firm looking for efficiencies,” the second senior U.S. intelligence official said. “There will be supply if there is sufficient demand.”

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momxijinping · 3 days

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@chexcastro just wanted to add my thoughts to that ask on assimilated ethnic groups in turkey and their potential wellbeing under a dotp:

we can examine an example of that actually in practice with a ethnic minority that was highly assimilated into the majority (though, the history is obviously not 1 to 1 with turkey's, especially considering the role that the qing dynasty played in china's history + the japanese imperialist manchukuo puppet state)

12ft unpaywalled link

this was published in 2013. ignoring like, the typical anti-communist tropes, monarchist RETVRNism and other weird shit in the article

A few universities have revived the study of the nearly extinct Manchu language, which is more like Mongolian than Chinese. There are culture seminars to study the dance, food and music of Manchuria, even Internet forums. Many people have also begun using their Manchu family names, even if few are legally registered like little Yehenala Yiyi.

Not all Manchus can trace their lineage to emperors, but many have ties to the former imperial bureaucracy. (In fact, a large number of descendants found jobs in the civil service or in state-owned companies, many joining the Communist Party.) In far western China, near the Kazakhstan border, descendants of a garrison of Qing soldiers still speak a dialect of Manchu, among the few native speakers left in China.

Unlike some other Chinese minorities, Manchus are not exempt from China’s limits on family size, although they do get preferential treatment on college entrance exams as part of an affirmative action program for minorities.

actually one of my parents had the option to fill in that ethnic classification and boost their score on the gaokao, but they chose not to bc they didnt identify with it

Courses in the Manchu language are now offered at Ethnic Minorities University in Beijing and at other schools around China. Because the Manchus have no separatist aspirations, they are considered a model minority by the Communist Party, and the government has encouraged some elementary schools in northeastern China, the heartland of old Manchuria, to offer the language so it doesn’t die out.

lmao

Nowadays, fewer than 100 people are believed to be native speakers of Manchu, the largest cluster of them in a single isolated village, Sanjiazi, in northeastern China.

“Only the old people can really speak the language,” said Shi Junguang, a part-time Manchu-language teacher who learned from his grandmother and has about 70 students.

So few people can read Manchu that many Qing Dynasty documents have gone untranslated, scholars say.

Despite their enthusiasm for Manchu culture, little Yiyi’s family has not gone so far as to study the language.

“It is not very useful,” grandfather Ye Longpei said sadly. “Without language there is no ethnicity … which is why our ethnicity will probably die.”

weird thing to say tbh. the cpc doesn't categorize ethnic groups just based off of language alone, that's just one data point of many it used to make those decisions for recognition- they also consider lifeways & location & customs/traditions

+ from wikipedia:

In 1952, after the failure of both Manchukuo and the Nationalist Government (KMT), the newborn People's Republic of China officially recognized the Manchu as one of the ethnic minorities as Mao Zedong had criticized the Han chauvinism that dominated the KMT.[128]: 277 In the 1953 census, 2.5 million people identified themselves as Manchu.[128]: 276 The Communist government also attempted to improve the treatment of Manchu people; some Manchu people who had hidden their ancestry during the period of KMT rule became willing to reveal their ancestry, such as the writer Lao She, who began to include Manchu characters in his fictional works in the 1950s.[128]: 280 Between 1982 and 1990, the official count of Manchu people more than doubled from 4,299,159 to 9,821,180, making them China's fastest-growing ethnic minority,[128]: 282 but this growth was only on paper, as this was due to people formerly registered as Han applying for official recognition as Manchu.[128]: 283 Since the 1980s, thirteen Manchu autonomous counties have been created in Liaoning, Jilin, Hebei, and Heilongjiang.[137]

Since the 1980s, the reform after Cultural Revolution, there has been a renaissance of Manchu culture and language among the government, scholars and social activities with remarkable achievements.[11]: 209, 215, 218–228 It was also reported that the resurgence of interest also spread among Han Chinese.[141] In modern China, Manchu culture and language preservation is promoted by the Chinese Communist Party, and Manchus once again form one of the most socioeconomically advanced minorities within China.[142] Manchus generally face little to no discrimination in their daily lives, there is however, a remaining anti-Manchu sentiment amongst Han nationalist conspiracy theorists. It is particularly common with participants of the Hanfu movement who subscribe to conspiracy theories about Manchu people, such as the Chinese Communist Party being occupied by Manchu elites hence the better treatment Manchus receive under the People's Republic of China in contrast to their persecution under the KMT's Republic of China rule.[143]

if i may theorize: the general uplifting of people from poverty as well as the campaigns to raise literacy and improve peoples' health and keep them fed as well as actively attacking majority chauvinism, on both the base and superstructural level and encouraging ethnic cultural development, coupled as one whole, may indeed lead to de-assimilation or a revival of ethnically cleansed or assimilated minority groups

#china #manchu

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yasperapologist · 2 months

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yasper is dying a slow death because the wifi in his building is isn't working. he can't even get a good hotspot running because the cable company is throttling his bandwith for using more data than 99.5% of all customers. aniq tells him he should file a complaint with the fcc.

yasper is playing minesweeper at lightning speed while his internet is down. each time he accidentally hits a mine, he screams in distress. aniq can now tell yasper's minesweeper screams from his normal screams. yasper kind of misses the way aniq would run in all concerned the first few times before he wised up. the red timer in the corner of the screen counts the seconds. in his haste to beat his last record, yasper mis-clicks on a mine. he quickly hits control + z; it's not cheating if he meant to click on the square to the left.

yasper is so bored that he actually files a complaint with the fcc. the guy on the phone keeps asking him pointed questions about his internet contract. yasper's getting to that, but he has to set the scene first! it was a lazy summer afternoon, with the kind of perfect weather that was made for sitting inside and watching youtube. olivia rodrigo's new album had just come out and it was time to crank that shit up to 1080p on the tv...

yasper is sitting on a park bench with aniq, eating a turkey sandwich and surveying a flock of pigeons. aniq inexplicably loves pigeons but yasper finds them deeply sinister. as a peace offering, he tosses a crumb from his sandwich onto the ground. the pigeons swarm the crumb, cooing and fluttering. yasper grimaces, feeling menaced. pigeons are so awful, he says to aniq, you have terrible taste. yasper realizes that this was technically a self-burn, but aniq just gives him a lovestruck smile.

yasper is pulling into the mcdonalds drive through and getting hassled by chelsea about almost hitting the curb. with an accusatory point, she asks, how come you're only a good driver when aniq is in the car? yasper is trying and failing to come up with an explanation that doesn't involve the phrase precious cargo. instead, he rolls down his window and orders two mcflurries and a large fries.

#the afterparty #yasper lennov

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mostlysignssomeportents · 8 months

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This day in history

#20yrsago Itunes blocks you from sharing music with YOURSELF, on your own computer https://web.archive.org/web/20041009202513/http://www.raelity.org/computers/operating_systems/apple/mac_os_x/apps/itunes_single_instance.html

#20yrsago How fanfic makes kids into better writers (and copyright victims) https://www.technologyreview.com/2004/02/06/40304/why-heather-can-write/

#15yrsago Flashmob of ATM crooks scores $9 million in 49 cities https://web.archive.org/web/20090205214559/http://www.myfoxny.com/dpp/news/090202_FBI_Investigates_9_Million_ATM_Scam

#15yrsago Internet not full of pedos, the statistical edition https://www.zephoria.org/thoughts/archives/2009/02/06/doing_the_math.html

#10yrsago Turks bid farewell to the Internet in the face of brutal censorship/surveillance law https://medium.com/@ahmetasabanci/saying-goodbye-to-internet-in-turkey-33d805b98f6c

#10yrsago Middle class brands collapse, 1% brands thrive https://www.nytimes.com/2014/02/03/business/the-middle-class-is-steadily-eroding-just-ask-the-business-world.html

#10yrsago How UK spies committed illegal DoS attacks against Anonymous https://www.nbcnews.com/news/investigations/war-anonymous-british-spies-attacked-hackers-snowden-docs-show-n21361

#10yrsago Toronto’s reference library gets a makerspace https://web.archive.org/web/20140209061223/http://torontoist.com/2014/02/reference-library-unveils-3d-printers-is-cooler-than-indigo/

#10yrsago Toxic Avenger’s brilliant rant about the importance of Net Neutrality https://www.techdirt.com/2014/02/05/innovation-our-better-future-depend-preserving-net-neutrality/

#5yrsago One of pharma’s most notorious gougers is going bankrupt, but 2019 is a banner year for shkreli-grade pharmaceutical price-hikes https://arstechnica.com/science/2019/02/infamous-pharma-company-declares-bankruptcy-after-3900-price-hike/

#5yrsago Chasing down that list of potential Predpol customers reveals dozens of cities that have secretly experimented with “predictive policing” https://www.vice.com/en/article/d3m7jq/dozens-of-cities-have-secretly-experimented-with-predictive-policing-software

#5yrsago Amazon is using purchase data to sell targeted ads, which is creepy, but not because they’ve invented a mind-control ray https://memex.craphound.com/2019/02/06/amazon-is-using-purchase-data-to-sell-targeted-ads-which-is-creepy-but-not-because-theyve-invented-a-mind-control-ray/

#5yrsago The next Firefox will block all autoplayed audio, video https://hacks.mozilla.org/2019/02/firefox-66-to-block-automatically-playing-audible-video-and-audio/

#5yrsago RIP, author Carol Emshwiller https://locusmag.com/2019/02/carol-emshwiller-1921-2019/

#5yrsago Washington State sheriff used courtroom camera to zoom in on defense attorney and juror’s private notes https://www.seattletimes.com/seattle-news/san-juan-sheriffs-use-of-courtroom-camera-to-view-jurors-notebook-lawyers-notes-sparks-outrage-and-dismissal-of-criminal-case/

#5yrsago Lawsuit says that America’s “break even” court records website shouldn’t be making 98%+ profits https://www.techdirt.com/2019/02/06/multiple-parties-including-author-law-governing-pacer-ask-court-to-stop-pacers-screwing-taxpayers/

#5yrsago Fox News blames schools teaching “fairness” for support for a tax on the super-rich https://www.reddit.com/r/LateStageCapitalism/comments/annfs6/fox_news_blames_public_support_of_wealth_tax/

#1yrago Bruce Schneier's "A Hacker's Mind" https://pluralistic.net/2023/02/06/trickster-makes-the-world/#power-play

#pluralistic

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kp777 · 1 month

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By Julia Conley

Common Dreams

Aug. 10, 2024

"Kroger is trying to pull a fast one on us by using digital price tags—a move that could let them use surge pricing for water or ice cream when it's hot out," said the senator.

Expressing doubt that a new artificial intelligence-powered "dynamic pricing" model used by the Kroger grocery chain is truly meant to "better the customer experience," Sens. Elizabeth Warren said Friday that the practice shows how "corporate greed is out of control."

Warren (D-Mass.) was joined by Sen. Bob Casey (D-Pa.) on Wednesday in writing a letter to the chairman and CEO of the Kroger Company, Rodney McMullen, raising concerns about how the company's collaboration with AI company IntelligenceNode could result in both privacy violations and worsened inequality as customers are forced to pay more based on personal data Kroger gathers about them "to determine how much price hiking [they] can tolerate."

As the senators wrote, the chain first introduced dynamic pricing in 2018 and expanded to 500 of its nearly 3,000 stores last year. The company has partnered with Microsoft to develop an Electronic Shelving Label (ESL) system known as Enhanced Display for Grocery Environment (EDGE), using a digital tag to display prices in stores so that employees can change prices throughout the day with the click of a button.

As Warren said on social media on Friday, digital price tags allow stores to "use surge pricing for water or ice cream when it's hot out," or raise the price of turkeys just before Thanksgiving.

Through its work with IntelligenceNode and Microsoft, Kroger has gone beyond just changing prices based on the time of day or other environmental factors, and is seeking to tailor the cost of goods to individual shoppers.

As the senators explained:

The EDGE Shelf helps Kroger gather and exploit sensitive consumer data. Through a partnership with Microsoft, Kroger plans to place cameras at its digital displays, which will use facial recognition tools to determine the gender and age of a customer captured on camera and present them with personalized offers and advertisements on the EDGE Shelf. EDGE will allow Kroger to use customer data to build personalized profiles of each customer... quickly updating and displaying the customer’s maximum willingness to pay on the digital price tag—a corporate profiteering capability that would be impossible using a mere paper price tag.

"I am concerned about whether Kroger and Microsoft are adequately protecting consumers' data, and that as Kroger expands the personalized customer experience, customers will ultimately be offered a worse deal," wrote Warren and Casey.

The lawmakers noted that the high cost of groceries is a key concern for workers and families in the U.S., as chains adopt numerous methods to price-gouge customers including "shrinkflation" and "greedflation"—filling packages with less product and keeping prices high even though supply chain issues have largely resolved since inflation was at high during the coronavirus pandemic.

Kroger, which could soon increase its number of stores by several thousand with a potential $24.6 billion acquisition of Albertsons, had an operating budget of $3.1 billion last year, with gross profit margins above 20% over the last five years.

Meanwhile, said Warren and Casey, U.S. households spent an average of 11.2% of their budgets on food in 2023.

"The increased use of dynamic pricing will drive company profits higher—leaving consumers with the bill," wrote the senators. shri"It is outrageous that, as families continue to struggle to pay to put food on the table, grocery giants like Kroger continue to roll out surge pricing and other corporate profiteering schemes."

Warren and Casey demanded the McMullen provide information about its use of ESL platforms including EDGE, asking how the company establishes prices using dynamic pricing and whether it has ever used EDGE to change the price of an item more than once in a day, among other questions.

The senators have previously introduced legislation to prevent shrinkflation, urged the Biden administration to use its executive authority to lower food prices, and proposed a bill to prohibit price gouging by empowering states and the Federal Trade Commission to enforce a federal ban.

#ai #grocery prices #greedflation #shrinkflation #Intelligence Node #kroger #microsoft #Electronic Shelving Label (ESL)#Enhanced Display for Grocery Environment (EDGE)#ftc #bob casey #elizabeth warren

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