ok, watch this short video: http://albumoftheday.com/facebook and the REAL meat of it doesn't kick in until at least halfway through, so if it seems boring/self-evident, give it a chance.
 
this information appears in text form in these articles, to various levels of detail (but the story is essentially the same):
 
http://www.nzherald.co.nz/section/story.cfm?c_id=5&objectid=10456534&ref=emailfriend

http://www.brainsturbator.com/articles/facebook_the_cia_and_you/
 
(interesting note: two years ago, I had six links in this list, four of them are now bad links, entire domain names are missing now, in some cases... did they just decide to fade away? or were they somehow forced out of service? ;-) Yes, articles sometimes get moved around within sites, but if their search engines are working, I should have been able to find the new location.  It seems that the story was entirely removed, not just relocated.  Ask me for the links if you want to do some detective work.)
 
in particular, check out the second link (on brainsturbator), which gives a very unique and critical perspective on the known facts and the conclusions that some have drawn... and in spite of it's skepticism, still leaves me with a distinct sense of unease.
 
But I think the issue of who may have funded the project in the first place is the scariest issue of all.  You know what I am talking about.  If not, watch http://albumoftheday.com/facebook a second time, particularly the second part.
 
well actually, this is kinda scary too: honestly i think that a lot of people are in denial and don't WANT to know... or pretend that they don't care once they hear it. or they really actually DON'T care, because Facebook is suddenly so important to them, or they think they are somehow safe because "well, i never fill in any personal information". so what if you don't? if the people linked to you are stupid enough to admit their political affiliations, it could cause you grief somewhere down the road (what if America swings far to the right in the next election?  or like this: http://www.care2.com/causes/facebook-friending-lands-activist-back-in-prison.html )... and even if you never join, you are in the same boat as me: Facebook knows exactly which people have me in THEIR address books, and if they ever say something stupid in their profile, they are still linked to me, whether i want this known or not. the whole thing sucks. I admit that all social networking sites carry similar risks, but the ties that Facebook has to some very scary places, and the fact that some people are now using it for ALL their electronic communication, well... that takes it to a whole new level.
 
also scary: the people who say "anyone (or at least a determined and computer-literate government agent) can find out anything about you by searching the internet already, even without Facebook, so what's the difference? privacy is dead, just deal with it." - the difference is that all other info about you is scattered over many different websites, in private emails, postings to obscure forums, etc. However, if people use Facebook as their number one communication tool, and a substitute for email, blogging, a personal web page, and everything else... then the info about you is ALL IN ONE PLACE in a single database, and that takes it to a whole new level, totally unprecedented in human history.  Maybe not every user has access to all of this (though the level of snooping that can be done on FB even by a determined private citizen is pretty scary in itself) but remember, THEY have access to everything you have ever written on FB.  and will have that access forever.  Do you think they purge that stuff?  Hell no!  (see http://www.forbes.com/sites/kashmirhill/2011/09/27/facebook-keeps-a-history-of-everyone-who-has-ever-poked-you-along-with-a-lot-of-other-data/ if you don't believe me). That's what "data mining" is all about, being able to go through extremely large databases and draw conclusions from it.  Trust me on this.  I'm not a luddite, I'm a web database developer and I know fully well what they are capable of doing.  EVERYTHING you write or do on Failbook is sitting in a privately-owned database, forever.
 
How about that facial recognition technology?  Has it occured to you that maybe every time you tag someone in a photo (or confirm or deny a facially-recognized suggestion for a tag)  you are helping out the government?  Please don't tell me "oh this totally respects your Facebook privacy settings, and you can only tag friends, and so on".  I am not worried about random strangers having tools to recognize you in their photos.  I am worried about Facebook's funders having the largest facial-recognition database of the citizens of the First World that has EVER existed, by far.  Do you think the "privacy settings" matter to them?  Please read THESE before you tag any more photos of your "friends":

http://www.pcworld.com/article/240363/facial_recognition_technology_facebook_photo_matching_is_just_the_start.html

http://www.pcworld.com/article/229742/why_facebooks_facial_recognition_is_creepy.html

People talk about how "Facebook can save the world by giving people a chance to start social revolution online" and I say BULLSHIT, we didn't need Failbook to do that!   All we needed was already there... plain text email and simple forums were breeding social change long before Failbook came along.  People change when they wanna change, and having the tools available isn't enough to provoke that... statistically, most people use Failbook for pointless blather and gossip.  Besides, if you were doing something bordering on civil disobedience and possibly illegal by the rules of your country... would you talk about it openly on Failbook, and risk being investigated by your own government?  if anything, have a trusted friend set up a webserver (which ain't that hard to do) and a website with simple forums in Drupal, phpBB, vBulletin or something similar... and now you can communicate WITHOUT The Man listening in! 

(ASIDE: if you are concerned about the lack of privacy even with plain-text email, I hear you, that's a separate issue in itself.  But here's a possible solution to your woes, I've used this myself and it's pretty slick: http://email2.com )  

Also... if you want to pat yourself on the back and say that your socially conscious Failbook activity and all the activists in your friends list are proof that you are making a difference... here's a reality check:  http://www.alternet.org/vision/151058/what_facebook_is_hiding_from_you/ here's a quote:

and that's just the downside of the activism that Failbook DOES permit.  what if Failbook decides they don't like your cause?

http://www.addictinginfo.org/2011/08/15/hey-facebook-are-you-really-censoring-political-free-speech-in-america

http://www.examiner.com/dogs-in-national/facebook-and-the-death-of-networking

http://act.demandprogress.org/sign/facebook_political/?akid=570.352670.usJXea&rd=1&t=3

http://www.theprovocation.net/2011/08/facebook-faces-growing-complaints-of.html#.TkwXBypVMHc.care2

http://edition.cnn.com/2010/TECH/social.media/06/29/facebook.bp.controversy/?fbid=xqmL4kFkY5Z

I say it again... just say no to Failbook!
 
 
peace and love,
Fish

REQUIRED READING!

http://itsalltech.com/2011/08/10/anonymous-pledges-to-kill-facebook/

here's a quote from the above:

http://www.alternet.org/story/151307/the_latest_creepy_step_from_facebook%3A_facial_recognition_technology_?akid=7115.297795.aag1zT&rd=1&t=6

ALSO INTERESTING:

http://www.physorg.com/news170614271.html

http://itgrunts.com/2010/10/07/facebook-steals-numbers-and-data-from-your-iphone/

https://www.eff.org/deeplinks/2011/01/social-media-and-law-enforcement-who-gets-what

http://www.pcworld.com/article/195756/facebook_privacy_complaint_a_complete_breakdown.html

http://www.care2.com/causes/dumb-and-dumbed-down.html

http://theweek.com/article/index/214901/is-facebook-really-an-appalling-spying-machine

http://en.wikipedia.org/wiki/Criticism_of_Facebook

ps: believe it or not, here's a true story from my friend Jen... doesn't this make you wonder a bit?
 
"I decided that I would conduct a little experiment and changed my status tag line to read, "Jen is wondering if anyone else is worried about Facebook's Privacy Policy?"
 
Within 10 minutes my profile was mysteriously "unavailable" I logged on as my partner, as I check his account from time to time at his request because he has no internet at his house, and found that my account was also "unavailable" to him. For a day or so, I could not retrieve my account and then it was suddenly back from the hole it fell into and nothing appeared to be altered...
 
Very odd...."
 
 
pps: here's another thing.  People sometimes say to me "why don't you get a "fake account" so that you can at least join groups at read event postings?"  Well, three years ago i was dating someone who was always on the road, and for some reason her cellphone could do Flailbook but not regular email.  she insisted that I get an account so that we could communicate that way.  After much reluctance, I did.   
 
Well, after not using that account for a few months (ie: after our breakup) I tried to log back in and got a message saying something like "We have determined that you are not who you said you were, and your account has been terminated".  the ONLY info I gave was a fake name (a very common one, not "John Smith" but something similar), a fake age, and said that I lived in Toronto... and I signed up for this account with a fake hotmail address (last time i checked, hotmail was the only main webmail provider that didn't require you to give a real address as a backup, and therefore the only one where you could create an account with totally fake and untraceable information.  and yes, I made sure that the little info I did give to hotmail was the same as what I gave to Flailbook)
 
So what happened?  Did they cross-reference my account against all John Smiths in the phone book for Toronto, and determined that every John Smith already living there had a valid and in-use Flailbook account, and therefore I must be an imposter?  I'd be very curious to know how they figured it out.  And it's kinda scary, no matter how you slice it.  They don't WANT "anonymous users", they want to know who you REALLY ARE.  To what end?  You figure it out.

ppps: after all this doom and gloom, here's some humour.  Only it wouldn't be funny if it were TRUE, would it?  hmm.... http://www.theonion.com/video/cias-facebook-program-dramatically-cut-agencys-cos,19753/