Trudeau: Strengthening NAFTA is Key to U.S.-Canada Relations (Pacific Council article)

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Trudeau: Strengthening NAFTA is Key to U.S.-Canada Relations

FEBRUARY 12, 2018
By: Justin Chapman, Pacific Council

Canadian Prime Minister Justin Trudeau defended NAFTA and free trade in a recent speech at the Ronald Reagan Presidential Library.

Watch the full speech below:

"America has no better friend, ally, or partner than Canada," Trudeau told the audience, which included Pacific Council members. "We have the longest, most peaceful, and mutually beneficial relationship of any two countries in the history of the world. Simply put, if trade between Canada and the United States is a bad idea, then there are no good ideas. The sum of our trade is essentially balanced. This is and will continue to be ‘win-win.’"

While acknowledging that NAFTA can and should be modernized and updated, Trudeau argued that the free trade agreement has been beneficial for Canada, the United States, and Mexico, and that trade is not a zero sum game. The sixth round of NAFTA negotiations recently concluded in Montreal. The seventh round is scheduled for Mexico City at the end of February.

"With effort, hard work, and a willingness to compromise on all sides, updating NAFTA is eminently achievable," he said, adding that progress has indeed been made, despite some challenging issues facing the negotiations such as disagreements over rules of origin for the auto sector, investor-state dispute settlements, and a regular five-year review of the agreement.

"We need to make sure the benefits of trade are shared more broadly with more people. We must provide more help to people whose livelihoods are disrupted by global economic shifts."

Justin Trudeau

"It’s vitally important that we build on that progress," he said. "It is fundamentally in Canada’s and the United States’ interest that we do so. Trade is not a hockey game. The truth is, both Canada and the United States are winning. And so is Mexico. That’s exactly how we should keep it. When trade is working as it should, all partners win."

That said, he acknowledged that global trade has not helped everyone achieve prosperity.

"Income inequality is growing worldwide, and this is an urgent problem," he said. "A lot of people are doing well, but far too many are not. The status quo of NAFTA and also trade more broadly is not good enough. We need to make sure the benefits of trade are shared more broadly with more people. We must provide more help to people whose livelihoods are disrupted by global economic shifts, including automation and technological change, so they can reestablish themselves in new jobs with brighter futures."

This is an area where he and President Trump agree, despite popular opinion that the two administrations could not see eye-to-eye about anything because of their political differences.

"The truth is we agree about this: too many people have been left behind even as our economies surged," Trudeau said. "I was heartened to hear President Trump talk about the importance of skills training in his State of the Union address. We in Canada are seized with the same problem and have reached a similar conclusion: we cannot allow the technological wave to sweep working families aside. This is something we must address as we modernize and improve NAFTA."

"We can and must work tirelessly to find a pathway to prosperity for us all. This is among the greatest challenges of our time."

Justin Trudeau

Trudeau quoted Ronald Reagan in a speech the former U.S. president gave to Canadian parliament in 1987, highlighting the U.S.-Canadian relationship and promoting the U.S.-Canada Free Trade Agreement: "We look forward to the day when the free flow of trade, from the southern reaches of Tierra del Fuego to the northern reaches of the Arctic Circle, unites the people of the western hemisphere in a bond of mutually beneficial exchange. When all borders become what the U.S.-Canada border so long has been: a meeting place, rather than a dividing line."

He argued that both governments can and must do more to help the people who have been left behind by global trade.

"We can and must build bridges to new opportunities for the middle class, and people working hard to join the middle class," he said. "We can and must work tirelessly to find a pathway to prosperity for us all. This is among the greatest challenges of our time."

"President Reagan most famously declared, ‘It is morning in America.’ A generation later, it can be morning in North America. But that is up to us."

Justin Trudeau

Trudeau expressed confidence in the U.S.-Canada relationship, both historically and looking ahead to the future.

"The United States and Canada have stood shoulder to shoulder through thick and thin," he said. "Let’s not raise fresh barriers between our peoples. The nexus point for this all is NAFTA. Our task, surely, is to take what our parents’ generation built and transform it into a trade agreement fit for the 21st century. We in Canada, for our part, will devote every necessary effort, for as long as it takes, in a spirit of fairness and mutual compromise, to achieve this goal. President Reagan most famously declared, ‘It is morning in America.’ A generation later, it can be morning in North America. But that is up to us."

_______________________

Justin Chapman is the Communications Officer at the Pacific Council on International Policy.

The views and opinions expressed here are those of the speaker and do not necessarily reflect the official policy or position of the Pacific Council.

Experts: International Response to Rohingya Crisis Lacking (Pacific Council article)

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Experts: International Response to Rohingya Crisis Lacking

FEBRUARY 7, 2018
By: Justin Chapman, Pacific Council

During a teleconference about the ongoing humanitarian crisis in Myanmar and Bangladesh that has displaced the Rohingya Muslim minority, experts disagreed about how the international community should respond.

The call featured Mr. Simon Billenness, executive director of the International Campaign for the Rohingya; Ms. Priscilla A. Clapp, senior advisor at the U.S. Institute of Peace; and Dr. Ali Riaz, university professor in the Department of Politics and Government at Illinois State University. The discussion was moderated by Dr. Parveen Parmar, associate professor of clinical emergency medicine in the Keck School of Medicine at the University of Southern California.

In recent months, nearly half a million Rohingya Muslims have fled from Myanmar’s western Rakhine State into Bangladesh to escape abuse and death at the hands of Myanmar’s army. The crisis, which both the UN and the United States are referring to as ethnic cleansing, has now become the worst contemporary humanitarian disaster in Southeast Asia.

"The sanctions on the Myanmar army have been one of the more important contributions the international community has made to support the civilian government."

Simon Billenness

While Billenness argued for the extension of Western sanctions against the Myanmar army, Clapp disagreed and said sanctions will not help any of the parties involved.

"The sanctions on the Myanmar army have been one of the more important contributions the international community has made to support the civilian government," said Billenness. "The United States could be doing a lot more to help resolve the Rohingya crisis situation in Myanmar and Bangladesh. It can sanction individuals in the Myanmar army as well as business interests. Sanctions do effect Asian business in Myanmar."

Clapp argued that sanctions actually do more harm to western nations than they help the Rohingya.

"The West’s sanctions against the Myanmar army won’t turn anything around for the Rohingya, it will just cut us out of the situation," she said. "We need to keep engaged."

Billenness countered by saying it is "fundamentally misguided" to say sanctions didn’t work. "Sanctions essentially brought the army to the negotiating table," he added.

"It is counterproductive to put the blame for the Rohingya crisis on Aung San Suu Kyi. She cannot afford, politically, to be speaking out against the military in favor of the Rohingya."

Priscilla Clapp

They also had different perspectives on where the responsibility for these human rights abuses in Myanmar ultimately lies. While they both singled out Myanmar’s army, they differed on how much blame should be laid at the feet of Myanmar’s leader, Aung San Suu Kyi.

"The problem in Myanmar is the army, which has considerable political and economic power," said Billenness. "The solution to problems such as the violence against the Rohingya is to dramatically curtail Myanmar’s military power and put the army under civilian oversight. It is the army that is carrying out the vast majority of grave human rights abuses. There needs to be consequences for them."

Clapp agreed with that point, adding that there are essentially two governments in Myanmar: civilian and military.

"The civilian government is not responsible for the Rohingya crisis; the military government is," she said.

Riaz argued that ultimate responsibility for the ongoing humanitarian crisis lies with Kyi.

"The Rohingya crisis is an abject failure from Aung San Suu Kyi," he said. "Perhaps we put too much hope in her in the beginning, because of the structural constraints. But that doesn’t mean she couldn’t do anything."

"Where is the action from the international community regarding this crisis? A coordinated international response is necessary. Without it, this crisis isn’t going anywhere."

Ali Riaz

Clapp pushed back against Riaz’s argument, saying that it’s "counterproductive to put the blame for the Rohingya crisis on Aung San Suu Kyi. She doesn’t have control of the situation. She tried to turn things around for the Rohingya. But she cannot afford, politically, to be speaking out against the military in favor of the Rohingya."

With or without sanctions, Riaz said that the international response to this crisis has been severely lacking.

"The camps that more than 700,000 Rohingya are living in look like concentration camps," he said. "The conditions are terrible, and monsoons are coming. I am worried about public health. Where is the action from the international community regarding this crisis? A coordinated international response is necessary. Without it, this crisis isn’t going anywhere."

Billenness also discussed the potential involuntary repatriation of the Rohingya back to Myanmar, a plan that has since been postponed.

"One crucial voice has been missed in the negotiations over the repatriation of Rohingyas, and that is the Rohingyas themselves," he said. "We need to ask them, where do they want to go? Where do they want to live? The voice of Rohingya is not being heard. It is unfortunate. It is shocking. It has to change."

Listen to the full conversation below:

_______________________

Justin Chapman is the Communications Officer at the Pacific Council on International Policy.

The views and opinions expressed here are those of the speakers and do not necessarily reflect the official policy or position of the Pacific Council.

Beating the odds (PW article)

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Beating the odds

Cancer survivor Gerald Freeny becomes the first black president of the Tournament of Roses

By Justin Chapman, Pasadena Weekly, 2/1/2018

Gerald Freeny of Altadena made history on Jan. 19 when the Tournament of Roses Association announced that Freeny will serve as the first African-American president of the 123-year-old organization, presiding over the 130th Rose Parade and the 105th Rose Bowl Game on Jan. 1 under the theme “The Melody of Life.”

Until recently, the Tournament had long struggled with the image that it was an exclusive organization run almost entirely by white men. An African American had never served in the organization’s senior staff until 2015, when a senior director of community relations position was created, and there have only been four African-American Rose Queens. It took decades of lobbying and protesting for the Tournament to change its diversity and inclusion policies.

Although Freeny’s presidency was announced last week, the Tournament has a seven-year succession path for its presidents and he was actually elected on Jan. 6, 2011 by the 14-member Executive Committee, the Tournament’s decision-making body consisting of seven future presidents, the current president, the immediate past president, and five rotational “at-large” members. These five seats must be held by racial and gender minorities who get a vote but are not in line to become president like the others and only serve for two years.

The at-large members were added to the Executive Committee as a compromise following protests in 1992-93 led by local developer Jim Morris and newspaper publishers Joe Hopkins and Danny Bakewell, who is also a developer. They blocked traffic with vehicles on South Orange Grove Boulevard in front of Tournament House in fall 1993 to protest the organization’s lack of diversity.

Freeny, 57, was one of the first people chosen to be an at-large member when it was created in 1993. He served from 1993-95, having started as a volunteer with the organization in 1988.

“Being one of the early at-large members gave Gerald the opportunity to be seen on the Executive Committee,” said Ronald Okum, who served as president in 2002 and mentored Freeny.

A cancer survivor, Freeny attended Cal State LA and graduated in 1983 with a degree in business administration and a minor in finance. In addition to his lung cancer, Freeny also had two liver transplants and a kidney transplant. He lives in Altadena with his wife Trina and their daughter Erica. Freeny is a member of the Kappa Alpha Psi and Gamma Zeta Boulé of Sigma Pi Phi fraternities and the First Historic Lutheran Church.

Lessons of Little Rock

In the late 1990s, the Tournament hired consultant Dr. Terrence Roberts — one of the Little Rock Nine who was among the first black students to attend an all-white high school in Arkansas in 1957 through the protection of federal troops — to work with its members and staff in helping them “address complaints from various public and private individuals, organizations, corporations, and municipalities that they were essentially a ‘Whites Only’ organization,” according to Roberts’ consulting  business website.

“I told them, ‘Consider this: You’ve got a bunch of old white guys driving around in white suits, now what message does that send? Literally,’” said Roberts, who has lived in Pasadena since 1985, referring to the 935 volunteers who dress in all-white suits on New Year’s Eve and New Year’s Day. “They were a little aghast, as you might expect. I said, ‘What we need to do is help you develop a greater sense of awareness about what’s going on here. You need to have a historical dimension so you understand why people are even considering making noise about you. You’re not just an occasional thorn in the flesh here. You are representative of what this country has stood for, for too long.’”

Volunteers serve on one of 31 operating committees to help organize and pull off the parade and game, such as the Equestrian Committee, the Parade Operations Committee, the Float Construction Committee, and so on. To move up, exemplary volunteers get promoted to vice chair and then chair of a committee. Among the 31 committee chairs, 16 are considered “director-chairs.” Among those 16, about five have seniority, and candidates to become members of the Executive Committee — and thus a future president — are typically chosen from this pool. It usually takes about 20 to 25 years of volunteer service to the organization to reach this level. This is Freeny’s 30th year with the organization.

Once a person is voted onto the Executive Committee, they are considered a vice president. After serving four consecutive years, they ascend to the office of secretary in the fifth year, treasurer in the sixth year, executive vice president in the seventh year, and then president in the eighth year. That person serves one more year on the Executive Committee after their presidency, and then they are rotated off and become known as a “life director.” The organization’s largely ceremonial Board of Directors is made up of all living past presidents/life directors.

A historic moment

Craig Washington, father of 2012 Rose Queen Drew Washington, former chair of the city of Pasadena’s Northwest Commission and director-chair of the Tournament’s Equestrian Committee, served on the Tournament’s Executive Committee as an at-large member from 2009-11, helping to lay the groundwork for Freeny’s election.

“My task was in whatever way possible to influence in a positive way Gerald’s ascension as a candidate to be elected,” said Washington. “I made a strong lobbying push by spending time with Executive Committee members, talking with them, listening to them, and getting straight to the point, asking, ‘Why hasn’t Gerald been selected? What are the concerns?’”

Freeny’s name had been brought up as a possible new presidential candidate a few times in the years prior to his actual election, but he had thus far been passed up.

The 14 members of the Executive Committee vote using an electronic tool. Everyone presses a button and the results pop up on a screen as a bar graph. With Freeny and other candidates nominated, the first round of balloting began in early January 2011. Washington expected a split result, and thus subsequent rounds of voting that he feared could last a long time.

The members cast their secret electronic votes and the results popped up on the screen. It was a clear majority for Freeny.

“I looked up at the screen and damn near cried,” said Washington. “It was his time.”

Shutting down Millionaire’s Row

Long before the Tournament did the right thing and elected an African American as a future president for the first time, racial tensions were heating up in early 1990s Los Angeles. The Tournament still did not have diverse leadership at that time, even though the African-American community had been demanding they diversify as early as the 1960s.

“African Americans were in no way positioned to be in leadership because of the structure of the organization,” said Washington. “In order for you to become a member at the time you had to be recommended by existing Tournament members. Well, geez, there were no African-American Tournament members, so the little circle just kept going. You’d never get recommended to come into this association.”

In December 1992, racial tensions were so high that Tournament officials agreed to create a new Ethnic Diversity Committee to recruit minority volunteers, expand cultural diversity and reach out to community and political leaders. The president that year, Gary Hayward, issued a statement saying the committee’s task would be in keeping with “our longstanding tradition of conducting our all-volunteer efforts on the highest order of fairness and equality.”

However, that same week, Hayward said in an interview with the Pasadena Star-News that promoting minorities who did not have seniority would “destroy morale” among the membership. Adding insult to injury, then-Tournament Executive Director John H. B. “Jack” French added, “It will never happen.”

Critics called the comments racist, a characterization that Hayward takes issue with.

“I don’t like getting called a bigot,” he said. “I’m not a bigot. It’s amazing that somebody would call somebody they don’t even know a bigot, and call an organization racial and bigoted. They didn’t even know the organization; they were just making a lot of noise to get their name in the paper. The Tournament wasn’t a good old boys club. That’s what was so funny. The only restrictions Tournament had at the time were to live or work within a 15-mile radius of Tournament House. That was it. There was no restriction on race, color, creed, female, or whatever. Tradition is what it was.”

Members of Pasadena’s African-American community, however, argued that progress was moving too slowly and that they were not receiving the same opportunities that white men were within the organization.

As the Tournament began ramping up activities for the upcoming parade on Jan. 1, 1994, Morris and Bakewell decided it was time to shake things up at the Tournament in a big and visible way.

Shortly before 11 a.m. on Oct. 21, 1993, Morris drove a rented Ryder truck and Bakewell drove a Lincoln Town Car to Wrigley Mansion, home of the Tournament of Roses Association on South Orange Grove Boulevard. They positioned their vehicles across the four lanes so that traffic coming from both directions was blocked, just as Tournament members were attempting to arrive for the coronation ceremonies of Rose Queen Erica Beth Brynes of Arcadia. Chaos ensued.

“It was absolutely fabulous, because at that time we knew that we could really move this forward for change,” said Morris. “If you look at the demonstrations that took place in the South, the only reason why they were able to make progress is because of demonstrations. We felt that if we backed down there would never be a Gerald Freeny.”

Dozens of demonstrators gathered on the sidewalk in front of Tournament House holding signs and demanding the organization diversify its leadership and membership. Tournament members verbally clashed with protesters, with one elderly woman reportedly shouting at protesters, “I could kill you,” according to a Los Angeles Times report at the time. Another member told a pregnant protester, “Shut up, you tramp.”

“We want to transform the Tournament of Roses into something truly representative of the community,” Bakewell told a Times reporter at the scene.

Police eventually called in the S. N. Ward & Son towing company, which was owned by then-Tournament President Michael Ward and contracted with the city, to tow the vehicles away.

Eventually, Tournament officials agreed to add five “at-large” seats to the Executive Committee consisting of minority members of the local community. Critics called it tokenism, because although those five people would have the same voting rights and privileges as the original nine members of the committee, they were not in line to be president of the organization like the others.

“You were there to voice your opinions with regards to the community, with regards to speaking for the common member,” Freeny said. “At-large members had every right as an individual who was in line to be president, so that means we had a vote on all issues, and we were invited to all events, but we weren’t in line to be president.”

Still, Washington pointed out, “That was a significant change in the organizational structure, in growing this Executive Committee, which created all the policies.”

Progress made

Freeny and Okum recently agreed that the Tournament has progressed in the years since Bakewell, Morris and others shut down Millionaire’s Row. Women and nonblack minorities have served as president in recent years.

“It is a very diversified organization, and I think when that happens you don’t have the sameness we had from years ago where everybody was white, everybody had the same socioeconomic background,” said Okum, adding that several African Americans are moving up through the ranks and that another African American is expected to be voted onto the Executive Committee in the next few years.

“The diversity is not even an issue anymore,” Okum said. “It’s a different organization from the diversity standpoint than it was 20 years ago.”




Countering Extremism Through Voices of Defectors and Women (Pacific Council article)

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Countering Extremism Through Voices of Defectors and Women

JANUARY 29, 2018
By: Justin Chapman, Pacific Council

To counter extremist groups’ recruiting efforts, the United States must amplify the voices and stories of defectors and women, Mr. Haroon Ullah said during an event hosted by the Pacific Council and the USC Center on Public Diplomacy. Ullah is the chief strategy officer at the Broadcasting Board of Governors and the author of the book Digital World War: Islamists, Extremists, and the Fight for Cyber Supremacy. The discussion was moderated by Dr. Karen North, director of USC Annenberg’s Digital Social Media program.

Watch the full conversation here.

"To take on terrorists’ online narratives, we have to include, curate, and amplify the voices of defectors and women," said Ullah. "How do we get those stories out there? Some of the most powerful stories are from defectors. If you look at gang culture in LA in the 90s, those who were former gang members had street cred. The messenger matters. The tragedy is that in most countries [joining a terrorist organization] is illegal, so there’s no way for them to be reintegrated. They have to be held accountable and they’re put in jail, so their stories are lost. We need to amplify and tell their stories. Their narratives can change people’s lives."

Ullah said that in addition to defector stories, voices of women—and mothers in particular—effectively counter extremists’ narratives. He added that terrorist groups like ISIL have become extremely sophisticated in terms of their online recruiting efforts.

"ISIL knows that audience matters," he said. "They have thought very carefully about and have a good sense of audience architecture and segmentation. Their mantra is, ‘The narrower the audience, the bigger the impact.’ They’ll say one thing in Arabic and then say something very different in English. Eighty percent of ISIL propaganda [in Arabic] is what we would call positive. A lot of it is about governance and giving candy to kids. Very different from what we see in English. We see the fear and horrifying beheadings and bloody narratives."

"They’re good at using new apps, social media platforms, and technologies to reach new audiences. They’re able to fail fast, change their message very nimbly, and evolve."

Haroon Ullah

Another thing from Ullah’s research—which was largely based on interviews with defectors—that he noticed is their platform agility and their ability to "fail fast and scale up," as he put it.

"ISIL started using platforms in 2014 and have since moved way beyond Facebook and Twitter," he said. "They’re using apps like Riot, which allows encrypted communications, and Sarahah, which is now the top app in 25 countries and bigger than Snapchat, in their recruitment efforts. They know how to move from platform to platform depending on the audience they’re trying to reach."

He added that they are also starting to crowdsource their recruiting using their own version of a Kickstarter campaign.

"They’re good at using new apps, social media platforms, and technologies to reach new audiences," he said. "They’re able to fail fast, change their message very nimbly, and evolve. They have these constant feedback loops."

"While we’re still talking about a platform they were using three years ago, they’ve moved on to different things. We now have to wrap our heads around ISIL 3.0."

Haroon Ullah

Ullah worries that the West is behind the curve when it comes to countering extremist narratives.

"Governments, by nature, move slowly," he said. "While we’re still talking about a platform they were using three years ago, they’ve moved on to different things. We now have to wrap our heads around ISIL 3.0. There are new terrorist groups on the horizon that have the potential to become ‘cloud caliphates’—an entirely virtual online ecosystem using the dark web, cryptocurrencies, and encrypted apps. That’s something to think about as we try to get ahead of this. This is a content war, and this field is moving so fast."

Ullah also argued that there are a few misperceptions regarding who joins groups like ISIL and why.

"It’s a misnomer in popular thinking that poverty drives militancy," he said. "That if you don’t have a job, if you need subsistence, you’re going to join one of these terrorist groups. But actually, if you look at the majority of fighters that went, they come from the middle class. They’re driven by identity grievances, not by economic grievances."

"The way ISIL recruiting works is that it’s spread through close, intimate, one-on-one contact. It actually models closely to the way diseases spread."

Haroon Ullah

Just like all politics is local, Ullah pointed out, all radicalization is local as well.

"There’s hotspot mapping and data that shows among the fighters in Tunisia, 80 percent of them came from one neighborhood in southern Tunisia, and in the Belgium attacks 75 percent of the fighters came from one neighborhood in Brussels," he said. "We almost need a public health approach. This counterinsurgency approach to fighting ISIL is not working. The way ISIL recruiting works is that it’s spread through close, intimate, one-on-one contact. It actually models closely to the way diseases spread."

Ullah pointed out that ISIL particularly knows how to reach a young audience. They plant a seed of doubt online through social media, encrypted apps, and the dark web, and eventually young people will find their message.

_______________________

Justin Chapman is the Communications Officer at the Pacific Council on International Policy.

Check out photos from this event on our Flickr page.

The views and opinions expressed here are those of the speaker and do not necessarily reflect the official policy or position of the Pacific Council.

High Risk & High Reward: The Emerging Cryptocurrency Markets (Pacific Council article)

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High Risk & High Reward: The Emerging Cryptocurrency Markets

JANUARY 18, 2018
By: Justin Chapman, Pacific Council

While emerging cryptocurrencies come with enormous risks including the lack of international regulations, the technology is also a source of important innovation and has the potential to help alleviate poverty, experts told Pacific Council members in a Situation Briefing teleconference.

The panel included Mr. Kwon Y. Park, counsel at Delta Strategy Group; Ms. Andrea O'Sullivan, Technology Policy Program manager at George Mason University’s Mercatus Center; and Mr. Enzo Villani, managing director of Transform Group LLC. The discussion was moderated by Mr. John Nahas, partner at Engeocom-Invicta Trading LLC.

Blockchain technologies and cryptocurrencies such as Bitcoin are changing the way people think about economic privacy, security, government currency monopolies, and the global financial system. With digital asset trade becoming an increasingly global phenomenon, the international financial regime has yet to develop policies to address the challenges that these new technologies raise.

"It’s useful to take a step back and ask, ‘What is this thing? What is Bitcoin and other cryptocurrencies?’ It’s brand new," said Villani. "It’s not a true commodity, it’s not a complete fiat currency obviously, and it’s also not a pure equity because you don’t have the rights as an investor on the equity side, but you also don’t have the risk. It’s almost like a miles program and like crowdfunding, where people are pre-selling a utility product."

"Don’t expect to see these regulatory agencies banning specific activities outright... because U.S. regulators are mindful that they don’t want to hamper innovation."

Kwon Park

In December, U.S. Securities and Exchange Commission Chairman Jay Clayton released a statement on cryptocurrencies and ICOs (initial coin offerings, an unregulated means by which funds are raised for a new cryptocurrency venture), which in part read, "Please recognize that these markets span national borders and that significant trading may occur on systems and platforms outside the United States. Your invested funds may quickly travel overseas without your knowledge. As a result, risks can be amplified, including the risk that market regulators, such as the SEC, may not be able to effectively pursue bad actors or recover funds."

Park said he doesn’t expect U.S. regulators to introduce new formal rules regarding cryptocurrencies in 2018, because they are currently waiting to see how the industry plays out.

"In 2018, I would expect more interpretive guidance being issued from various agencies to provide additional clarity to the industry, but I don’t expect formal rulemaking per se," he said. "That doesn’t mean we won’t see one or two. I also don’t expect to see these regulatory agencies banning specific activities outright, such as these ICOs as Chinese and Korean regulators have done in their jurisdictions, because U.S. regulators are mindful that they don’t want to hamper innovation and have all of these innovative projects move overseas."

He pointed out that many investors and companies are trying to get into the cryptocurrency industry in recent years because people have been successful in raising capital through the success of many ICOs. He said that a lot of the concern regarding Bitcoin and other cryptocurrencies derives from their speculative nature.

"They’re not registered exchanges," he said. "But when these cryptocurrencies or ICO projects are considered a security, it will subject the token issuer to registration requirements with the SEC. It will require the exchanges that are trading these cryptocurrencies to register with the SEC as a national securities exchange. It will be subject to ongoing investor disclosure requirements and other regulations."

He pointed out that some market professionals attempt to get around this by labeling their ICOs "utility" tokens, but that that does not prevent the token from being a security. To date, no ICOs have been registered with the SEC.

"Regarding tax issues, the IRS has deemed virtual currencies as property for tax purposes, which means it would be subject to capital gains treatment," he said. "There is now some uncertainty as to whether all coin trading will be considered a lifetime exchange, meaning will you get taxed when you trade one cryptocurrency for another, or when you trade one cryptocurrency for a fiat currency like the U.S. dollar, so when you make the withdrawal that’s when the tax treatment would be triggered."

"People in war-torn areas may not be able to use traditional banking, so in those types of situations Bitcoin and other cryptocurrencies can be a vital tool."

Andrea O'Sullivan

O’Sullivan gave a brief overview of how cryptocurrencies and online commerce developed, which she said took longer than it would have otherwise because of security concerns.

"In the early days of the internet, there was no infrastructure for people to make secure payments online," she said. "In late 2008/early 2009, it looked like the problem had finally been solved. The invention of blockchain technology—using peer-to-peer computing and cryptography—allowed people to send payments directly and securely from one person to another without having to rely on a trusted third party."

She pointed out that for people in countries with developed financial systems, this may not seem useful, but for people who live in countries without secure financial systems, this has the potential to be a very important tool in poverty alleviation.

"People in war-torn areas may not be able to use traditional banking, so in those types of situations Bitcoin and other cryptocurrencies can be a vital tool," she said. "As a potentially cheaper alternative to paying Visa or PayPal fees, this could be a way to bring more people into the financial system and expand the domain of trade across the world."

"Rather than building an unwieldy new regulatory structure that might unduly limit some of the innovation taking place in this promising industry, a better path forward is to simply apply existing policies to money transmitters in the cryptocurrency space."

Andrea O'Sullivan

O’Sullivan said when she talks to policymakers, she tells them that many of the financial policies that are in place for existing activities can simply be applied to cryptocurrencies.

"Rather than building an unwieldy new regulatory structure that might unduly limit some of the innovation taking place in this promising industry, a better path forward is to simply apply existing policies to money transmitters in the cryptocurrency space," she said. "In other cases, new policies must be developed or reassessed. The policy approach should encourage the positive uses of such technologies while keeping an eye on the potential negative uses. U.S. leadership in this area should be solidified, lest we risk pushing development and innovation to other countries. Policymakers must educate themselves about this promising industry."

Villani argued that cryptocurrencies would never have been developed in the first place if worldwide banking transactions were not so slow and costly.

"The goal of cryptocurrencies is to take out the friction in the transacting and transferring of value across the world," he said. "There are challenges with the current banking system, such as the delay in transferring and the cost of Western Union which is extremely high. So you have the unbanked trying to send money to their home countries, and they’re paying these exorbitant fees. This would never have happened if banks were trustworthy and didn’t charge big money-wiring fees to people who are close to or below the poverty level."

"If you’re not ready to lose your money completely, you shouldn’t be in it. This is high risk and high reward."

Enzo Villani

Villani said that regulators are currently letting cryptocurrencies work themselves out because they do not want to hamper innovation.

"We all know there’s some type of bubble going on with cryptocurrencies," he added. "The press and the SEC highlighting that fact is a good thing. No one wants anyone to get hurt. But the people in this market are innovators and entrepreneurs. Regarding Bitcoin or any new market, you have to look at your own analysis. If you’re not ready to lose your money completely, you shouldn’t be in it. This is high risk and high reward."

Listen to the full conversation below:

_______________________

Justin Chapman is the Communications Officer at the Pacific Council on International Policy.

The views and opinions expressed here are those of the speakers and do not necessarily reflect the official policy or position of the Pacific Council.

Saving American democracy (PW article)

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Saving American democracy

Patrisse Khan-Cullors explains why Black Lives Matter in a powerful memoir with asha bandele, When They Call You a Terrorist

By Justin Chapman, Pasadena Weekly, 1/18/2018

As the city of Pasadena deals with the fallout over the use-of-force incident in which Pasadena police officers beat a young African-American man named Chris Ballew on Nov. 9, Patrisse Khan-Cullors has released her timely and powerful memoir about co-founding Black Lives Matter and, in part, denouncing police brutality and calling for independent, community-led police auditors.

When They Call You a Terrorist: A Black Lives Matter Memoir is a deeply personal exploration of Khan-Cullors’ life, from her hardscrabble upbringing in Van Nuys and the trauma of watching her pre-teen brothers being arrested for doing nothing to her exploration of her sexuality (she identifies as queer but had a couple of meaningful heterosexual relationships throughout her life). She describes bonding with her father and the pain of losing him too early, first to drugs and jail and then ultimately to death.

The book weaves her often painful personal and family history into the larger class and racial struggles taking place in Los Angeles in the 1980s and ’90s. From an early age, she learned that the police were not looking out for her or her family’s best interests.

“For my brothers, learning that they did not matter, that they were expendable, began in the streets, began while they were hanging out with friends, began while they were literally breathing while Black,” she wrote. “For us, law enforcement had nothing to do with protecting and serving, but controlling and containing the movement of children who had been labeled super-predators simply by virtue of who they were born to and where they were born, not because they were actually doing anything predatory.”

An Unheard Story

The memoir, co-authored by writer and activist asha bandele, with an introduction by activist and scholar Angela Davis, is written poetically, at once calling out the injustices of America while also inspiring hope into a new generation and instilling the fight in those to come. On Friday, Khan-Cullors and bandele launched a 14-city book tour at the California African American Museum in Los Angeles, which was attended by hundreds of people.

“Part of the reason why I wrote this book is because I wanted to have a larger conversation about what it means to grow up black and queer as a woman in Los Angeles, which has been deeply impacted by militant policing and a jail system that is the largest jailor in the world,” said Khan-Cullors. “How does that actually impact black women and young black girls? We haven’t heard a story in that way, because mass incarceration and state violence is so often talked about through the lens of black men. It’s also a coming of age story. It’s about how I became an organizer and eventually how I helped start Black Lives Matter.”

Her work inspired Jasmine Abdullah and Black Lives Matter Pasadena, who have been vocal in opposition to the killings and brutality carried out by the Pasadena Police Department. Khan-Cullors called their work “powerful.”

“Pasadena often reminds me of a small suburb outside of a big city that gets very little attention,” she said. “I remember the very small story about Kendrec McDade’s killing and Reginald Thomas’ killing. Black Lives Matter Pasadena is a lot of young people, 11 year olds and 12 year olds, who are trying to carve out a space for black people in a historically white town.”

The book also lays out the tragedy of Khan-Cullors’ brother Monte, who suffered from schizoaffective disorder but was treated like a criminal and a gang member by the police, who arrested him, charged him with terrorism for yelling after a fender bender, withheld medication from him, beat him and humiliated him in jail, and repeated the process shortly after he was released. His life, like many other young black men before and after him, was never the same, and neither were the lives of his family members, who were forced to be the support network that society denied him.

After reading the 2011 ACLU report detailing the abuse deputies inflicted upon inmates in LA County jails, Khan-Cullors realized that although she and other activists are often called terrorists, it is the police who terrorize black people.

“I am still a teenager when [Monte] is tortured by the LA County Sheriff’s Department,” she wrote. “Torture is planned out and its purpose is to deliberately and systematically dismantle a person’s identity and humanity. It is designed to destroy a sense of community and eliminate leaders and create a climate of fear. Torture is terrorism.”

First and foremost, Khan-Cullors wants people who read the book to realize how resilient black people and other people at the margins of society actually are.

“I want people to see more than just the really tragic stories that I talk about in the book, but also that organizing and activism can actually save American democracy,” she said. “And I want people to see the love that I have and that so many of us have for black people.”

Birth of a Movement

Black Lives Matter was founded in 2013 following the tragic acquittal of George Zimmerman for the murder of 17-year-old Trayvon Martin. In the wake of the verdict, Khan-Cullors responded to a Facebook post by her friend Alicia with a hashtag that would soon go viral. In response to her friend writing, “Stop saying that we are not surprised. That’s a damn shame in itself. I continue to be surprised at how little Black lives matter. Stop giving up on black life,” Khan-Cullors wrote, “#BlackLivesMatter.” And thus, a movement was born. And Khan-Cullors began organizing.

The movement picked up steam in 2014 following the shooting of an unarmed 18-year-old named Michael Brown in Ferguson, Missouri, by a white officer. With each new killing of an unarmed black person by a white officer across the country, the message that black lives do not matter became further ingrained, Khan-Cullors writes in her memoir, and therefore all the more necessary is the message of Black Lives Matter.

Looking ahead, Khan-Cullors said Black Lives Matter is developing a strategic vision and plan for the next five years.

“Black Lives Matter, the organization, and the larger movement for black lives is in a really powerful moment,” she said. “We are taking stock of the last four and a half years and taking the time to really codify the work that we’ve done. We are in a place where much of our work is about what it takes to build strong institutions that can take on administrations like we have right now under 45.”

She added that President Donald Trump’s recent comments referring to Haiti and African countries as “shitholes” is “absolutely disturbing.”

“The fact that he’s the president is disturbing,” she said. “The reality that he is the president for such a marginal part of our population, and that he really represents the underbelly of American society.”