Authentification

Dear squid managers!
   
I would like to use my /etc/passwd file to authentifiacte users.
Which program can I use to authentificate against passwd?
Is it a good reason to create a special file for squid rather than use
passwd?
As I understand, password is sent in Base64 format, and even reading
mail via pop3 will send user password in a clear text. I would like to
use one password for mail, ftp, squid, etc in the intranet. So, I do not
think security is the reason in my case...
 
One more question - will I have problems with sites protected via Basic
HTTP authentification?
 
Thank you in advance!
 

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Vladas Lapinskas.