Which, in case it's not clear, is exactly what Hushmail did/does.
http://themonetaryfuture.blogspot.com.au/2009/05/pgp-creator...
Which, in case it's not clear, is exactly what Hushmail did/does.
http://themonetaryfuture.blogspot.com.au/2009/05/pgp-creator...
I personally believe that Lavabit (a tiny company composed of a few dedicated folks) would rather shut down service than do something as underhanded as what Hushmail did.
In either case, the end user is relying on a proprietary system/company to fight the good fight for them, which is foolhardy if your well being is on the line. Those in need of strong privacy would probably use PGP+tor for communication anyway.
FWIW, the Hushmail ex-CEO seems to strongly agree with you on both the ethics point and the need for users to take blind trust out of the security equation.
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So I've just gone to the Lavabit site and it looks like that they store your private key on the server.[1] That doesn't strike me as being more secure than Malone's idea of externally-audited client-side crypto. But then, as you say, you've arrived at PGPGPG.
The fact, then, that Zimmerman was involved with the company so early on and they still fucked it up just goes to show that faith in the efforts of 'a few dedicated folks' doesn't get you very far.