Politics and Government

State and Local Governments (U.S.)

  • Military Operations
    Protecting U.S. Waterways, Coastlines, and Maritime Infrastructure
    Eric Doucette, captain in the U.S. Coast Guard and visiting military fellow at CFR, discusses the primary missions of the coast guard including disaster management, protecting U.S. ports and shorelines, and other areas where the coast guard cooperates with local officials both domestically and internationally. A question-and-answer session follows his opening remarks. TRANSCRIPT FASKIANOS: Welcome to the Council on Foreign Relations State and Local Officials Webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. CFR is an independent and nonpartisan membership organization, think tank, and publisher focused on U.S. foreign policy. CFR is also the publisher of Foreign Affairs magazine. As always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. Thank you all for being with us today for this discussion. We’re delighted to have over 400 participants from forty-seven U.S. states and territories. And as a reminder, this webinar is on the record, and the video and transcript will be posted on our website after the fact at CFR.org. Each year, CFR awards five military fellowships to outstanding officers from each branch of the U.S. armed services. The Visiting Fellowship Program enables selected officers to broaden their understanding of International Relations while on active duty by spending a year in residence at CFR’s headquarters in New York. Our military fellows conduct individual research, contribute their knowledge and experience of their military service, and participate extensively in CFR meetings and events. So with that, we are pleased to have Captain Eric Doucette from the U.S. Coast Guard with us today. He is CFR’s 2024 U.S. Coast Guard military fellow. Prior to this role, he served as the chief of staff for the Coast Guard’s Ninth Coast District, which encompasses the Great Lakes, the St. Lawrence Seaway, eight states, and a 1,500-mile international border with Canada. Captain Doucette also previously served in the White House as special advisor to both Vice President Joe Biden and Vice President Mike Pence from 2016 to 2018. So, Captain Doucette, thanks very much for being with us today for this conversation on the Coast Guard’s cooperation with state and local officials to protect U.S. coastlines, waterways, and maritime infrastructure. The U.S. Coast Guard obviously serves many functions. I thought it would be great if you could begin by talking about your—or, the Coast Guard’s primary missions, and discuss the areas where the Coast Guard is cooperating with local officials both domestically and internationally, and where there are areas of opportunity for further growth. DOUCETTE: Well, thank you. Thank you, Irina. The Coast Guard, we’re a 50,000-plus person organization. And we’re spread all around the country. So we’re embedded with local communities within the states. And most other first responders think of the Coast Guard as part of their local team, because we happen to be there. So search and rescue operations is one of those areas, rescue mariners in distress or people that are out for recreational boating. And law enforcement goes hand in glove with that mission. Working with state police or other maritime or harbormasters. So the Coast Guard finds itself work law enforcement issues domestically in all the small communities around the country. Environmental protection, that’s a big area that not only do we work with the EPA on the federal side, we work with the state arms that do environmental protection. We work with industry and private sector to address spill response plans or hazardous material response plans. We support FEMA during natural disasters with dealing with hazardous materials. But port security and safety, looking at the overall port operations that happen in our major ports and in our smaller ports, the Coast Guard worked closely with the Army Corps and also with state port authorities to make sure that the waterways operate just as safely as the highways and the byways of our country. And then training and exercise. The Coast Guard is another force multiplier with local agencies, state agencies, and other federal agencies. They all do a great job shoreside, but also you have to do that operation in the maritime. The Coast Guard expertise with small boat operations, working in a maritime environment, we can help local hazmat teams, firefighters, in how to address issues that may be offshore. And then maritime planning and regulations. Working with development plans with port authorities or working with expansion or changes in how ports may operate. We are heavily involved, with our captain, the port authorities, working with state regulators and managing, again, those waterways. Just like similar to how the FAA would work with airports, and how to manage that type of change over the years. And we do a lot of public outreach and education. We do partnerships in education. We do events with the local community. We try to get involved as much as we can, so that the community has free access to the Coast Guard in their community. On the international cooperation side, counter-narcotics and antipiracy operations. Capacity building with other nations. Most navies in the world look like a U.S. Coast Guard. And they don’t look—they don’t have aircraft carriers and destroyers, but enforcing fishery regulations, enforcing environmental regulations, boat and safety for their—or helping their fishermen of their—of their nation-state is an area that the Coast Guard has unique skills where we can help other nations trying to build their capacity. Environmental protection. We definitely have a lot of expertise in that area that we can go around the world and help other nations that may have oil spills or their environmental disasters from ships. And then search and rescue, which is, again, our—one of our bread-and-butter pillars of what we do with domestically. It’s something that we can bring overseas and help develop capacities for other countries if they want to have a twenty-five mile—nautical mile offshore capacity for search and rescue. And you do that with helicopters. You do that with small boats. You do it with cutters and other—when I say cutters, that ship—that’s the Coast Guard term for a ship. And so, it’s a global Coast Guard. Again, we’re everywhere in the country, even on inland rivers. So, if some of the listeners are of a landlocked state, you might not think that the Coast Guard’s part—we operate our ship inspectors and work with your local agencies along a lot of the byways where barges are—up and down the Mississippi, or in other—the Ohio River, and other locations throughout the country. FASKIANOS: Fantastic. That’s great. And are you—what are you doing to enforce illegal fishing regulations? DOUCETTE: Well, I mean, so domestically we work, again, with the state wildlife officials, enforcement officials, that making sure that fishery—the state fishery laws, and the Federal fishery laws are enforced. International, one of the terms out there is IUU—illegal, unreported, and unregulated fishing. So, in fact, just this week, an agreement was signed with Samoa—the country of Samoa, not American Samoa—but where the U.S. Coast Guard could help enforce regulations within their exclusive economic zone. So, we can look for other state actors, or sometimes vessels that are stateless, that are they’re trying to fish in their EEZ. And no one’s regulating them, or inspecting what they’re catching, or how much they’re catching, or if they’re catching juvenile species, or protected species. So, we can board those vessels. And we have those cooperative agreements with a number of countries. But now, in this day and age, you know, we’re using a lot of satellite technology and working with other partners to help target some of these actors that are out there, because those fish resources are protein sources for a lot of these countries that don’t have a robust coast guard, or a way to protect what they need for their fishermen and for their own populations. FASKIANOS: Mmm hmm. Fascinating. I can continue on with questions, but I want to give people the opportunity to raise their hand. You can click on the raise-hand icon. And I will call on you to ask your question. Or you can type your question in the Q&A box. And we’d love to hear—for you to also share best practices or your experience, because this is a forum where you can exchange, and we hope that you’ll exchange, ideas and resources. So, we’re going to see if anybody has raised their hand. We have one raised hand. If you could identify yourself too, that would be fantastic. Going first to Kelly Bartlett. Q: Kelly Bartlett, Michigan Department of Transportation. Thank you for putting this out. Thank you for taking your time. I have two questions, one kind of immediate and one farther out there. The first, the immediate question, been on everyone’s mind lately with the—you know, the tragic incident in Baltimore with the Francis Scott Key Bridge. I’m just wondering, what’s the role of the Coast Guard in a situation like that? You know, where there’s a critical waterway that all of a sudden has this event and it affects, you know, all sorts of shipping and land-based movements. So just wondering if you could walk through what your role in that would be. And then, more abstract, farther out, Michigan Tech University is doing some work on leading to, we hope, autonomous freighters around the Great Lakes. And I’m just wondering if you have any thoughts on what pops first in your mind in terms of, whoa—we’d be really anxious about that or, you know, bring it on. So two wildly different questions, if I could. DOUCETTE: Great. No, thank you for asking both those questions. So just to, you know, step back, before the event in Baltimore happened, in all the ports around the country there’s—you know, there are port authorities, to varying degree, that are regulated, managed by the state. There’s pilots. And then the Coast Guard itself, we have a number of committees, going back to our planning function, that we involve. And we bring all private and public sector together to discuss issues like safety of the port. And so there are harbor safety committees. There’s area maritime security committees. And there’s area committees. The area committee deals more with environmental issues and threats, air and maritime security, that came out of the post-9/11 environment, brings a lot of law enforcement community together. And then the harbor safety committees, again, that’s the pilots, the operators, you know, the people that are operating that waterway to make the port safe, to make sure that dinner boat cruises can operate, that container ships or oil tankers or other ships that may carry hazardous materials, or if there’s visiting U.S. Navy ships, or even ships from other countries, that everyone is aware of how the port is operated. And in some ports that are busier, they have these vessel traffic services just like air traffic control. So those committees would have said things like under-keel clearance, they would have set things—what that means is that when a ship comes in, it can’t touch the bottom of the harbor. And that might sound funny, but a lot of our harbors are silted. They require the Army Corps to dredge them. And so it—sometimes the ships actually do touch bottom when they come in. But most ports, it’s set at two feet below those vessels when they come in. And there’s tidal differences. So these are some of the safety things that get discussed. Other things that get discussed in different ports where there may be some infrastructure at risk, maybe there’s a requirement. And, again, the Coast Guard Captain of the port in those different ports would help enforce those regulations or set those regulations through a rulemaking. But it would be a tug assist. So I was the captain of the port in Boston, prior to my time in the Great Lakes. And there—were there were liquefied natural gas ships would come in. And they had a big security footprint around them, with all sorts of states and local agencies. But at the same time, we had safety assist tugs that would help navigate them under the Mystic River Bridge and under some other some other tight spaces that they would operate. Now, jumping to your other question—or, actually, before I do that, and so then, when you see the event that happened in Baltimore, there’s a number of other plans—the National Response Plan, the National Contingency Plan. And I would—my best guess is that those are the type of plans that help provide the framework for all the agencies to work together down there in Baltimore. And when that actual incident happened, you saw the Coast Guard performing search and rescue. But we don’t do that by ourselves. The state of Maryland, the local harbormaster, and other local police forces and fire departments were all involved in that effort. And then one point is the dive teams. So those are integrated dive teams with state police, local fire departments, and then there’s the broader operation of working with the Department of—I mean, excuse me—Department of Transportation and FEMA to help get funding and assets. I think there was a presidential declaration. And I think at least the initial $60 million that helped get some of the operations funded. But—and then bringing in large cranes and other apparatus. That is a whole East Coast, you know, nation effort to bring the right equipment there. And when you see the pictures of the people cutting steel, and you think about how big that steel girder is, or if you drive over any large bridge, just how big that structure is. It may seem like it’s taken a lot of time to open that port up again, but it is a big structure and it takes time to lift each piece out, and to do it the right way. And they’re also doing it when there’s a natural high-pressure gas pipeline that’s right underneath a lot of that debris. So I know that a lot of care and effort’s going there to try to get that open quickly, but open safely. On your question of autonomous vessels, that has come up. Again, back when I was captain of the port in Boston, I approved a small vessel—it was called a Datamaran. It was a catamaran, but someone mistyped D, and it stuck. And it operated—MIT was operating it. And collected data for offshore wind. But this little vessel could tack like a small sailboat. And it didn’t require any people on board. And we also had the Mayflower II that was coming—it was before COVID. It was supposed to be here for the 400th anniversary of the Mayflower coming. And that vessel too had—it was a larger vessel. Didn’t have anybody on it. But even when it got close to shore, there was still—it was big enough that we would have to have some requirement that would have an assist vessel or someone that was with it. But throughout the country, there’s all these efforts for autonomous vessels. Elon Musk’s SpaceX, they have offshore—large, autonomous vessels that go offshore for the space launch. And they would love for those to operate without people on board, or assist people. And we know it’s—we know that it’s coming. But it’s still—the rules of the road still require a human eye to be there, to intervene given any type of situation that could happen at a moment’s notice, and alert. And going back to Baltimore, though there will be an investigation to why that took place, but it appears that there was some sort of power outage. The pilot on board taking quick action, notifying their response network to stop other vehicles from coming on board that bridge, you know, saved lives. And so that human operator being involved, I think that’s going to be the trick with autonomous vessels, is how do we ensure that there’s still someone that can make quick action. They may or may not be on the vessel, but they’re going to need to be able to react quickly and operate with people in that local environment. FASKIANOS: Thank you. I’m going to go next—we have lots of hands raised—going next to Linda Grisby. Q: There we go. Can you hear me? FASKIANOS: Yes. DOUCETTE: Yes. Q: Good afternoon, everybody. I’m curious about the invasive species in— FASKIANOS: Linda, can you identify yourself? Q: Oh, yes. I’m Linda Grigsby town of La Plata. FASKIANOS: Thank you. Q: You’re welcome. But I’m curious about the invasive species within the rivers. What are we doing to—what can we do to get rid of those more on a local level? DOUCETTE: Yeah. So I just came from the Great Lakes. And invasive species are a big issue. And so there’s different places that we work in partnership. Again, a lot of it will be, like, U.S. Fish and Wildlife and the state and local fish and wildlife entities. But there’s places where we will help with monitoring. We also do a ballast water program. So when foreign vessels come from other countries, they have to shift their ballast water, because sometimes that’s how invasive species came to our country in the past. And we test for salinity, to make sure that they shift—they shifted that water, so they’re not taking port water from a foreign country and bringing it to our country. That they’re actually shifting that at sea. Excuse me, one second. And then there’s also a number of other devices, especially up in the Great Lakes, in the rivers where they have the invasive carp. Excuse me. And they have electric fences, and have other detection crews that will go out and try to harvest those invasive species so they don’t get into the Great Lakes. And we—again, we will work with any agency. One of one of the agencies we work with the most is NOAA. And they will help us with a lot of scientific support coordination with other species that we’re trying to protect. But invasive species is a big issue. I think if anyone is a recreational boater on domestic lakes a lot, there’ll be a lot of invasive plants, other issues, that they try to control going from lake to lake. But in the coastal environment, there are different species—green crab, a number of other—zebra mussels, that we’ll work with water authorities and other entities, in any capacity to help, you know, retard or slow down the growth of these invasive species. FASKIANOS: Thank you. I’m going to take the next question, a written question from Massachusetts Representative David Biele: Is the U.S. Coast Guard involved in any fisheries enforcement with foreign nations in the North Atlantic, like that in the Pacific? DOUCETTE: Yes. We have ship rider programs. And so, you know, Canada being our closest partner, we will, in that neck of the woods, a lot of times U.S. Coast Guard vessels will be patrolling Canadian waters, and a lot of times apprehending U.S. fishermen that are operating in Canadian waters, to bring them back because. And it’s usually not the other way around, where the Canadians are coming into our waters. So we work—we have an agreement with Canada. And then we also have ship rider programs in the Caribbean and other locations, other countries. And we’ll bring their officers on board our vessels. they can see how our folks operate, to provide some education. We’ll take some of our best practices, like—things like fisherman’s nets, where they may be catching fish that have, like, turtle exclusion devices. So if the turtle gets caught in the net, the turtle can get out—has a way to get out. And then also, we’ll inspect the hulls of the catch to make sure they’re not catching any species that are—that are protected or undersized. A lot of times we’ll do those fishery boardings at sea, but we can also work with other agencies to do those boardings at the pier as they’re offloading or trying to sell the fish. And then a number of the vessels also have beacons or—that they have to display. And, you know, we can track those by satellite, and make sure that they’re fishing in the right zones, in the right areas, that are open for fishing, versus the regulated or closed areas. FASKIANOS: Thank you. I’m going to go next to James Murley with a raised hand. If you could identify yourself. Unmute yourself. There you go. Q: Thank you, Irina. My name is Jim Murley. I’m the chief resilience officer in Miami-Dade County, where we have a deep water port. The largest cruise ship port. And we also have a shallow Miami River Port. I would like to start by saying Sector Miami is a fantastic organization, the Coast Guard are professionals. We are a maritime border state and the interdiction responsibilities they carry out in multiple ways keep our citizens safe. So thank you, sir, for that service. My question has to do with derelict vessels. I’m charged along the Miami River right as we speak with a vessel that the Coast Guard interdicted, and brought on, and found a place to tie it up. And, you know, if there’s a car on the street, I can get rid of that car. Because the derelict vessel’s tied up to—it’s a headache. You got any good practices we can do to deal with derelict vessels? Thank you, sir. DOUCETTE: Absolutely. And I’ve come across that that conundrum and problem throughout the country. Even here in New York during Hurricane Sandy, we had a similar situation. A lot of the local laws on the books can be helpful about derelict property. And, again, it does get involved with the courts. And sometimes that can be sped up. But the biggest thing, if this vessel is in the water and it’s tied up, the biggest thing is we want to make sure that it’s not causing any type of environmental harm, you know, leaking oil or discharging. At the same time that it’s safe, that it’s being tied up, and that’s it’s being maintained and checked. Because in a way this sounds like this vessel—I don’t know the particular case of it—but it sounds like there’s no owner or operator. It was seized. And it was probably used for some nefarious activity. So it does become a conundrum on that part. The particular case I had here in New York that I worked with, it was a large vessel, about a 300-foot vessel, very similar with some owners that just did not have the wherewithal to follow through. And when Hurricane Sandy caused that vessel to wash up on a—almost on a—on a street in Staten Island, we were able to, because of the pollution threat, remove it and lift it. That actually, one of the same cranes that’s down there in Baltimore now, it’s one of the Donjon cranes, lifted it up. In that case, we put the—we put this ship up on land, where it could be scrapped and cut up into steel. But that took a lot of time working with the City of New York. And they used one of their abandoned property laws, similar to what you’re talking about with vehicles. We were able to use that as a way to get into the courts, and then have that vessel salvaged. And in the end, the city got a check back for like $75,000 for the worth of the steel from the scrap yard. But it is not always a successful solution, like, in that case. There’s a number of the cases that, you know, we’ve had to come in and, you know, clamshell or kind of dig the vessel out after it’s sank, in different situations. But I would definitely pursue the courts, and the property, and then the disposal method. And usually that’s going to involve hauling it up or putting it on land where it can be cut up. FASKIANOS: Thank you. I’m going to go next to a written question from Trustee Wayne Domke of Roselle Village in Illinois: Do you work with Homeland Security on immigration? And if so, how? DOUCETTE: Yes. So a number of times we’ll have encounters. One, the Coast Guard is part of Homeland Security, so we work with our cousin agencies on a day-to-day basis. So there’s some at the planning level, but if it’s a situation where we encounter a vessel, and it may be in the maritime in the offshore of the East Coast, if it’s a fishing vessel with either folks without documentation that are here—sometimes they’ll end up—as a job of last resort, they’ll end up as a fisherman. There are some rules in place that there’s a certain percentage—I think it’s 25/75—like 25 percent of the crew has to be a U.S. citizen if it’s a U.S. vessel, on these fishing vessels. And if they have documentation, it’ll be fine and they’ll just continue working. But a lot of times, we’ll find folks that just do not have the proper documentation. Then we’ll work with the other Homeland Security, Immigration, and other agencies to determine whether or not they have a desire to have these people be brought in and processed. And that can take some time. But to say that we may also encounter people on a regular recreational boat and law enforcement activity. Up in the Great Lakes, it wouldn’t be unusual for us to come across people doing human smuggling as well, just trying to enter our country via recreational boat, coming from Canada. They found some way to get to Canada, and they wanted to get to the United States. And we also see people going the other way, leaving the United States trying to go to Canada. And so we’ll work with both countries’ the immigration services to try to process the people, make sure that at least they’re documented and known to be present in either country. FASKIANOS: Thank you. I’m going to go next to Andrew Parks, who has raised his hand. You can accept the unmute and tell us who you are. Q: Can you hear me? FASKIANOS: We can. Q: Andrew Parks, director, Texas Senate Committee on Water, Agricultural and Rural Affairs. Thanks for taking the time to talk to us today. And I’ll echo the earlier sentiment, all of my interactions with the Coast Guard to date have been very professional. Really respect the guys you’ve got working for you. So all of my interactions with the Coast Guard up to this point have centered on disaster response. We’ve had several hurricanes in Texas over the last twenty years—Rita, Ike, Harvey, and others. Can you walk me through, first of all, how you plan for hurricanes and other natural disasters in abstract, and then in the—in the run-up to an actual hurricane, when you’ve got one off the coast, the kind of staging you do, the resources that you do, how you deploy them, et cetera? DOUCETTE: Absolutely. Every year we’ll—because the Coast Guard, we’re the military, we move our people around. So every year, prior to hurricane season, we’ll have a national exercise which tests our Coast Guard internal capacity to communicate up and down the chain of command, all the way back to Washington. And we also test our ability for the different captain report zones—the different—like, the Port of Houston or the Port of Miami—that they can set hurricane conditions. And what’s meant by that, is it’s a way that we communicate with the port authority and industry that we’re forty-eight hours, or ninety-six hours out from a hurricane. You know, if your vessel can get underway and avoid the hurricane, we want them out of the harbor. If they can’t get underway because they’re in the middle of some sort of repair or fixing the engine, then we’re going to have to—you have to double up lines. We want you to remove any type of debris that can be washed over shore. And so, we try to tighten up the port so it’s more resilient, given the nature—especially in the Gulf Coast, where you have these very large hurricanes. And then, going back to some of that planning that I mentioned before that we do with oil pollution, and we work with FEMA, this umbrella of plans that’s out there. Our National Contingency Plan, which deals with—you know, anyone can have a spill or hazmat release any day. That same skillset that we practice day in and day out with local, and state, and the commercial industry, we can use that during a hurricane. It’s the same people, we just fall under different plans, the National Response Framework. And that’s the FEMA plan, where all the different federal agencies line up. Like, the first thing in disaster would be transportation, get people out of there. So, the Department of Transportation takes the lead. But with Coast Guard, we’ll jump and do Department of Transportation support, because you can move a lot of people on cruise ships, you can move a lot of people on barges, or use our maritime highways to move folks. At Coast Guard, EPA, we’ll do ESF 10, which is hazard material and oil spills, a lot of times household hazardous waste, industrial wastes after a big hurricane, and ESF 9, search and rescue. So, again, we’re using a lot of skills that we use every day, but we are underneath this National Response Framework. And then the states, we work hand-in-glove with them with their emergency operations centers. But I think where the Coast Guard really adds a value is that we’re working with industry every day, inspecting their ships, inspecting their facilities. We know each other on a—we’re probably on our rolodex or on our cellphones, and we call each other when other events happen throughout the year. So, when the big event happens, like a big disaster, there’s a lot of commonalities where they would have been in the same committee meetings that I talked about before. And one other thing, just to add, we have another group. It’s not as well known. It’s more of an economic group. But they prioritize when the—when the harbors get back open, what ships have the priority to come back in. And industry gets together and works with us. And it may be that this particular industry, certain name, they’re low on gasoline. So, the first ship coming in is going to have to be gasoline. And so there’s a lot of work going on behind the scenes when we do get the port restored. And I’m sure that they’re doing that in Baltimore, too. What are the first—what’s the first vessel coming in and what’s the first vessel going out. And so there’s a lot of collaboration that helps prioritize—even though these industries may be competing with each other, when it comes to disaster we find that they all work hand-in-glove with each other, to try to take care of each other’s needs, even though they’re competitors. FASKIANOS: Great. Thank you. I’m going to go next to a written question from Paul Brierley, who is with the Arizona Department of Agriculture: My son serves in the Coast Guard as part of a deployable strike force created after 9/11. I describe some of the unexpected roles the Coast Guard plays as giving us a military presence where we aren’t allowed to have a military presence. Can you talk about some of the joint and support roles that the Coast Guard plays to our other military services? DOUCETTE: Absolutely. In fact, I was part of the deployable support forces. And we brought the team here from New York, CFR, down to visit the Atlantic strike team. Sounds like your son, and thank you for raising a great American servant, and it sounds like he might be with the MSRT, or one of the MSSTs, which are these—it’s probably one of our—the MSRT’s closest to what we have to special forces. They deploy around the world. They deal with piracy issues. They can deal with a vessel that’s been hijacked, just like an aircraft. They can do what they call an opposed boarding, and they can board these ships via helicopter or other means and neutralize any threat or risk that might be on that vessel and take the vessel back under control. Those teams, when they’re not doing actual operations to respond, they train other nations. You know, their SWAT teams, or their specialized force teams that exist. And, again you can take one from shore and try to put them out in the maritime, but there’s a lot of different skills that are involved, and the equipment that—oh, did we lock up? Oh there we go. But then the equipment that you carry, you have to have buoyancy too. If you end up in the water, it’s not the time to find out that you have too much gear weighing you down. So there’s special equipment or kit that that they train with and that they use during those operations. You mentioned about how we work with other countries. One of my jobs was out at U.S. Pacific Command. And I worked in Southeast Asia. And Vietnam has some—back a decade or so ago—had some really strict controls about foreign navies coming to their country. But when the Coast Guard would show up they’re, like, oh, you guys, you can come too. And you can even come back again, because the white ships, or even our C-130s are white with an orange stripe. So it doesn’t really give that warfighter impression to a lot of countries that may not allow the military to be present, or other agencies of our government present. They see the Coast Guard as a humanitarian organization. We’re lifesavers, and that’s—they resonate with that, and they invite us back. And that goes back to my statement about where most navies and other type of maritime forces in the world resemble a U.S. Coast Guard than an armed service that just is a warfighting machine. FASKIANOS: Great. Raised hand from John Jaszewski. If you could unmute yourself and identify yourself. We’re still waiting for unmute. I don’t know if there’s anything we can do on our end. Probably not. All right. Q: Can you hear me now? FASKIANOS: Oh, we can. It worked. Q: OK. I’m John Jaszewski, calling from Mason City, Iowa. I’m curious about flood control and mitigation. How does the Coast Guard interact, especially, you know, here in Iowa, we’re too far from the coast to be—you know, see much of Coast Guard. But I know you’re on the Mississippi. And what are things that you help local governments do to plan or mitigate the flood situations? DOUCETTE: Yeah. Thanks for the question. And we—I mentioned before these strike teams that we’re on. And a lot of the Coast Guard on the rivers too, they have deployable teams that can go up normally—to places normally where the Coast Guard would not be, but now it’s a flood environment. And you have folks trapped in homes, trapped up in attics. Sometimes that happens, people climbing to the higher levels to get out of a flood, but they get trapped in their attics. So, we can—with FEMA and with state agencies—they can request the mission assignment. And, in fact, there’s not too much bureaucracy involved. If there’s lives at hand, the Coast Guard’s going to get there, and work, and figure out how to get there and save people. But we’ll work, you know, hand-in-glove with your local sheriffs, your fire departments. And if they need, you know, flood response capacity, we have some deployable capacity. I mentioned before about hazardous materials. When I was on the Pacific Strike Team, Atlantic Strike Team, we would deploy teams to all sorts of landlocked states that had these floods. And the household hazardous waste would pile up wherever that kind of floods tsunami would end. And we would work with environmental arms to help recover all that material so it’s not sitting there seeping into the ground or the groundwater after the event. But, yeah, the Coast Guard does deploy. There’s a lot of places I’ve had my Coast Guard jacket on or coveralls and be up in the high mountains of Colorado helping with a wildfire or helping with other disasters. And people would never think that they would have saw the Coast Guard present there, but—and we also have these incident management assist teams. And they can help out during the disaster. They were there in Baltimore. But they can also help our before the disaster with incident command system training and other planning and exercises ahead of an event. FASKIANOS: I’m going to take the next question from Pam Wetherbee, city councilman from the city of Beacon, New York: What is the status of adding anchorages for barges on the Hudson River, and why is this needed? DOUCETTE: Yeah. I do know that there’s an effort underway, rulemaking. And I don’t have the particulars. So the captain of the port in New York will have the final details on anchorages. But from time to time, it’s—from my experience, whenever we determine anchorage locations it’s for safety, so that these barges—whether it’s the port of Boston or port San Francisco—it’s a place that’s designated where—whether it’s a fuel barge or it’s a gravel barge, a hopper barge that is there, we want industry to put them in a certain place that when they put the anchor down has the chain that goes to it, that barge will swing, around based on the winds or the current—in a river should be going in one direction but might not be as tidal up there like a harbor. But by defining that anchorage, what you don’t want is someone with their sailboat or recreational boat anchoring their boat, fish or go to sleep, and then, without having designated anchorage, that barge swings around and hits that vessel, from a safety standpoint. So having it designated, be on a chart, people would be—you’d be able to notify people or ask people to leave that area where the barge is anchored for safety or during some sort of construction operation, or other event. So that way the barges aren’t just being put anywhere. There’s a designated spot for them to be, that’s safe for the—for all people that use the waterway. And protects the ship channel. FASKIANOS: Great. I’m going next to Leslie Brosnan, who has a raised hand. Q: Yes. This is Leslie Brosnan. I’m Titus County clerk for Mount Pleasant, Texas. And with the power plants that have been shutting down in the last few years, does the Coast Guard work with the areas that have the lakes they will now need to be returned back to a natural state, on the EPA part of it? DOUCETTE: Yeah, so early in my career I had some—there were a lot of coal-fired plants. And as those were torn down, we would put a lot of safety or security—safety zones around them while they were imploding them and protected them. But when that site becomes, like, a remediation site or, like, a brownfield site, that will usually switch from the emergency response side of what the Coast Guard would do, and it’s more of a remediation. And our authorities are limited there. We would rely on the EPA. We would rely on the state environmental arm that’s dealing with that remediation work. But we do pay attention to those facilities that are in the maritime environment, especially the ones that do—that operate with vessels, foreign vessels, or any U.S. vessels. But there are a number of power plants that are now fed by pipelines, by LNG or direct fuel. And so then are—they’re not so much a regulated facility anymore, that the Coast Guard has authority over, per say, unless they have something that affects the waterway, like a spill or another event. FASKIANOS: I’m going to take the next written question from Councilmember Alan Mitchell, who’s in Greenville County, South Carolina: Thank you for your presentation today. Understanding that invasive species and waterways is a very important issue to tackle, does the U.S. Coast Guard ideally take the lead in identification and control? Or does Coast Guard take more of a cooperative support role? And what’s the best way for local government entities to support your efforts? DOUCETTE: Yeah. I would—I would describe our role in that as support, because we’re not setting the laws or the regulations about the species. But when it gets into an operational, like, we’re going to go out—like a task force, and we’re going to pursue—we want to be aware of it, and then we would publicize—help publicize that, and help make sure that the operators who are out there can do their work without being impeded by recreational boating traffic, or whatever it may be. And, again, the Coast Guard work would tend to be in the offshore maritime environment. Inland rivers or waterways, in a lake environment, we may not have a jurisdiction there, unless there’s some sort of vessels operated there. But again, our limitations would be the vessels that are carrying passengers for hire. You know, if it was a lake that bordered two states, or some like that. But one of the areas that we could certainly help is if you’re standing up teams, and it’s just—they’re going to be on boats, and you want to look at safety and what type of safety equipment—that’s a place that our Coast Guard Auxiliary, and I’m sure there are local Coast Guard stations, would be more than happy to help to make sure that your boat operators and the folks that you may be sending out in the field, that may be college students, that they have some awareness of the environment they’re going to operate in, so it’s safe for them to do the work that they have to do to tackle invasive species. FASKIANOS: Thank you. And I’ll take the next written question from Rob Cole, who’s in the Florida Keys, I believe: I’m curious to know what the staffing trend has been in the Florida Keys. We note, and are thankful for, what appears to be an appropriately increased level of support for open water surveillance and interdiction efforts. And are curious if nearshore routine safety missions involving recreational boaters and the like have experienced reduced coverage due to other resource redeployment or staffing reductions/unfilled vacancies. DOUCETTE: Yeah. So, the Florida region, just similar to the southwest border, but there’s a migration—we always, over the decades, have had maritime migration that happens from a number of the Caribbean islands. And so as those—the weather environment is suitable for people to transport to the United States via maritime means, we will surge staff from around the country. So when I was up in the Great Lakes, we would donate a lot of our resources, look for volunteers, but it was very common. I would send a pretty high percentage of our staff. And not just the Great Lakes. Throughout the country, we would send resources down to support the district in Florida, in the Florida Keys area. And these folks would be down there for a number of months to help support those operations. And then when the maritime migration would slow, we’d obviously bring those folks back. We are nationwide, like a number of the services. And encounter a period of time where—there used to be a time that 90 percent of people that joined the Coast Guard would just walk into the recruiting office, and we had a constant supply of Coast Guard personnel. We’re a small service. As I said, we’re 50,000 people. We recruit about 3,000 people a year. That doesn’t sound like a big number, but we—our people are ambidextrous, and they do a lot of different missions. So once we get them trained up with a four, five, or six year, to have that type of person lead the organization, most people in the Coast Guard, about 40 percent, stay in for twenty years. So when we start losing with retention, it does hurt us. We’re not used to—like I said, we recruit 3,000 people a year. The Department of Defense, big Army, big Navy, they recruit 3,000 people a day. And we just don’t have that type of throughput. So we are experiencing a challenging period right now. The way that we’re managing that is we have a number of seasonal stations. And that we may not open that seasonal station and put the staff there, but we’ll concentrate the staff at the main station nearby and provide the same amount of coverage by keeping the boats offshore patrolling that area. We may add additional cutter, larger ships, offshore, or helicopter patrols to make sure that we’re providing that same surveillance and mitigating any type of search and rescue or law enforcement event that may appear throughout the day. FASKIANOS: Great. Thank you. We are coming near the end of our time. So if you have final questions, please raise your hand or write your question. And I do have one: How does the Coast Guard coordinate with other federal and international agencies to stop illegal drug trafficking? DOUCETTE: Yeah. So actually not too far from our where our last questioner was is SOUTHCOM, and also at U.S. Pacific Command. And they have these joint interagency task forces. So there’s Joint Interagency Task Force South. And there’s an office within that command. And there’s probably seventy to 100 different agents and representatives, not just from the United States but from all the other countries. They’ll have other representatives, foreign representatives there. And they are from their version of the DEA or their customs agencies. And they work as a joint interagency team to address counternarcotics. And then the same thing goes out in the Pacific too. There’s a Pacific task force. So there’s Australian DEA agents that are right there in Hawaii working to help break down any type of bureaucracy between agencies. And one of the interesting facts that years ago our ships would go offshore, and they would do patrols, and maybe they would come across drug runners, and they’d have a big capture. But now, all our ships when they go offshore they’re informed by intelligence. We were tracking the information. And so we’re having large hauls of drugs and contraband. And if you added up all the drugs and contraband that’s seized by domestic law enforcement, the U.S. Coast Guard seizes is more of drugs and contraband at sea than all of the domestic agencies combined. FASKIANOS: I was curious, I think we touched upon this earlier, but if you could talk about the role that surveillance technology plays in U.S. Coast Guard missions? And also, how is the Coast Guard now thinking about and repositioning—and thinking about the use of artificial intelligence? DOUCETTE: So I’ve had the opportunity to be here at CFR and attend a number of artificial—so that’s where my thoughts have been this year, is how that can transform our service. So surveillance, to answer that question, the first part, satellite technology and being able to monitor offshore fishing in the Pacific, where maybe it takes weeks to get a vessel to, the fact that we can do that by satellite every day, or constant surveillance, or by having cameras or other radar arrays set up in different ports as ships come in and out to sell those catches of fish, or to take all the data and analyze that, again, AI’s ability to look at a mountain of data, whether it’s imagery, whether it’s sonar images, whether it’s audio—whatever that is out there that can be brought to the attention of the human, because the AI algorithm can be built to sift through and filter through that information to provide operators with better decision-making intelligence or information that this particular vessel may be operated in a shady way. And, again, sometimes we do this analysis by what fuel vessels consume, and what parts they’re not consuming, might give us indicators to investigate further. But I see AI being very instrumental, even in our bread-and-butter mission of search and rescue. You know, right now throughout the country there’s a young Coast Guard third-class petty officer, with a headset that looks like this, listening for that mayday call. And we’re still mandate to listen to mayday calls. Which is—and it’s through audio. And they’re listening to everyone talk in that Marine band radio. But if you had an AI device that could pick up: I’m in distress, I need help, or calling out for the Coast Guard. We do have some other technology where they just click their mic and we know where they’re at, and it takes the search out of rescue. But I can see where AI could get involved and, again, provide that information to the operator in a quicker way, and go through reams of photos and satellite images and make those vessels that we send offshore more effective in the missions that they’re pursuing. FASKIANOS: Fantastic. There’s a written question from Chris Cho, who’s a councilman in Closter, New Jersey: I just recently joined Flotilla 10-8, Bergen County, as an auxiliary member. I’m involved with an environmental group called Paddle World. It’s mainly a high school student volunteer group. Are there any programs with the U.S. Coast Guard that these high schoolers can donate their time doing volunteer work? And I thank you for your service. DOUCETTE: Yeah. Well, one, thank you for being part of the Coast Guard, part of the auxiliary. So, for everyone else on the line, we have a—similar to the Civil Air Patrol—but we have a volunteer force. And they’re almost just as big as the Coast Guard that we pay. And there’s a lot of works that we’re—like, safety, recreational boater safety, that we’re not funded for but it’s one of the missions we do. And the Coast Guard Auxiliary does that by visiting marinas, and when people buy their boats, to educate them on what life jackets and how to outfit their boat properly, how to—how to read a chart, and all that. So the auxiliary does a ton of work to help basically do preventative search and rescue, make sure that people don’t get into a situation offshore where there’s a problem. I forget the age, though, that people can join the auxiliary, but I have seen high school kids involved with the auxiliary. We also are starting—we were a little bit later than other services—but we have JROTC programs. And our goal is to have multiple JROTC programs in every district. There’s nine districts in the Coast Guard. And especially at inner city schools and other environments there. But that’s a way that we’re getting high school aged kids acclimated or aware of the Coast Guard mission. And I think you mentioned a paddle craft. So, again, that there’s been a growth in these paddle boards, kayaks, you know, other types of—that aren’t your traditional recreational boat, like, a motorboat, or a canoe, or a rowboat. Those things are regulated, and in some places they’re not regulated, and they’re not a requirement for people to wear life jackets. And I have pictures of people paddle boarding up in the Great Lakes and there’s a floe of ice next to them. And they fell in that water, they would not have a long survival time without either a wetsuit or a proper life jacket. So, again, the auxiliary can get out there. And the other message, to everyone that’s on the line, you may think that you’re too old, or it might be, to join the Coast Guard. Or you can join the auxiliary. You can be part of the Coast Guard. And it’s a lot of fun. And there’s—and if you’re into boating or the paddle craft, there’s an opportunity to get involved. So that’s a good point to bring up. FASKIANOS: I’m going to go— back to John Dizuki—Jaszewski. Excuse me. Q: Can you hear me now? FASKIANOS: Yes. Q: OK. I’m John Jaszewski, calling from Mason City, Iowa. Talk about recruitment. What kind of young men and women are you looking for? And what kind of requirements would they need to join the regular Coast Guard? DOUCETTE: Yeah. That’s a great question. Thanks for bringing it up. I tell you—you know, and I’m biased because I’ve been in Coast Guard thirty-five years, and I just wore my son into the Coast Guard last week. So it’s the high point of my career. And, you know, I would tell you that if you have access and know a lot of young, talented kids, whether they’re going to be high school graduates, they’re in college, and if they don’t know what they want to do, and they’re remotely interested in service to their country, environmental issues. I mean, we’ll take everyone. I think there’s—I think there’s a carve-out or there’s a mission in the Coast Guard, you can find something to do. And it maybe it’s—like, even with my son, it was let’s get in the Coast Guard. And maybe he’ll get exposed to cybersecurity, something that he wasn’t planning to do. But by joining the Coast Guard he’ll get a security clearance. That’s going to help him with other jobs—he’s going to join the reserves. And I joined the reserves when I was in college. And that’s how—and now I’ve been in for thirty-five years. But, again, I think it’s a great—if you’re an interested in law enforcement, you know, we’re a law enforcement agency. If you’re interested in environmental oil spill response, working with the EPA one day, there’s a lot of skills you will acquire with the Coast Guard. We have medical professionals. There are so many different ways that we’re bringing people into the Coast Guard. We have an electrician mate. So, we—and if someone’s already a qualified electrician, we’ll look at what credentials they have and say, you don’t need to go to our ten-week school, but maybe go to this week and this week, that gives you the marine portion of all the things you already know. And if someone has a medical background, we have medical professionals, and we’ll look at their credentials. And we’ll kind of—we’ll now custom to—this is very new. It wasn’t this way until recently. But—and they’ll even bring people in at advanced rate or rank based on their skills. So, if people were remotely interested, they should talk to recruiters. They should look at the Coast Guard website. I’m happy to take any calls any day for anyone that’s interested in joining the Coast Guard. And, again, you don’t have to do it for life, like me. You can just come in for a couple years and be in the reserves or be on active duty and call that good and move on with your life. But I joined the Coast Guard, you know, I was either going to be a state trooper or I was going to be in the Coast Guard. And now I’ve traveled to seventy countries, I’ve had twenty moves, lived all over the country. And it’s been a phenomenal career of opportunity. So, I would encourage anyone that wants to have an opportunity, look at the Coast Guard, consider the Coast Guard. FASKIANOS: Wonderful. We are at the end of our time. And I think that’s the perfect note on which to end. So, Captain Eric Doucette, thank you very much for your time today and for your service to our country. And, of course, we have really enjoyed having you at the Council this year. You have a few more months left before your fellowship comes to an end here. Thanks to all of you for your terrific questions. We will send out a link to this webinar recording and transcript. And you can learn more about CFR’s military fellows and browse their work by going to CFR.org and, as always, for other research and analysis on many issues and topics. Please also go to ForeignAffairs.com and ThinkGlobalHealth.org for other developments and analysis on international trends and how they’re affecting the United States. And, of course, do share your suggestions for future webinars by emailing [email protected]. So, again, thank you. And we hope you enjoy the rest of your day. END
  • Agricultural Policy
    Foreign Asset Ownership in the United States
    Zongyuan Zoe Liu, the Maurice R. Greenberg fellow for China studies at CFR, discusses China’s sovereign wealth funds, investments in the United States, and considerations for policy responses to foreign land ownership trends in the United States. Elizabeth Blosser, vice president of government affairs at the American Land Title Association, discusses recent state legislation on the purchase of U.S. property by foreign entities and individuals. A question-and-answer session follow their opening remarks. TRANSCRIPT FASKIANOS: Welcome to the Council on Foreign Relations State and Local Officials Webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. CFR is an independent and nonpartisan membership organization, think tank, and publisher focused on U.S. foreign policy. CFR is also the publisher of Foreign Affairs magazine. As always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. We appreciate your taking the time to join us today. As a reminder, this webinar is on the record, and the video and transcript will be posted on our website after the fact, at CFR.org. And we are delighted to have over four hundred state and elected officials registered, representing over forty-seven states and U.S. territories. We are pleased to have Elizabeth Blosser and Zongyuan Liu with us today. We’ve shared their bios with you, so I will just give you a few highlights. Elizabeth Blosser is vice president of government affairs for the American Land Title Association, ALTA, which oversees the association’s state legislative efforts including annually monitoring state bills related to the real estate, mortgage, and title industries. She also serves on the board of directors for the Property Records Industry Association. Ms. Blosser has worked for legislators on the federal, state, and local levels, and has extensive experience managing political grassroots and public relations campaigns. Zoe Liu is the Maurice R. Greenberg fellow for China studies at the Council on Foreign Relations. Her work focuses on international political economy, global financial markets, sovereign wealth funds, supply chains of critical minerals, development, finance, emerging markets, and more. Dr. Liu is the author of Can BRICS De-dollarize the Global Financial System?, published by Cambridge University Press, and Sovereign Funds: How the Communist Party of China Finances Its Global Ambitions, published by Harvard University Press. So thank you both for being with us today for this conversation on foreign asset ownership in the United States. Elizabeth, I thought we could begin with you, if you could give us a little background on specific policies regarding foreign land ownership in the United States up to now, and how could recent changes at the state level shape U.S. foreign policy going forward? BLOSSER: Yeah. Happy to talk about that. And want to say, we really appreciate the Council on Foreign Relations including us in this conversation. We especially appreciate it because we are not foreign policy experts. I have to admit I woke up this morning still a little bit surprised I was doing a webinar for CFR. But what we are experts on is the safe, certain, and legal transfer of real estate in this country, something that represents approximately 13 percent of GDP. So we think that’s very important. So there’s been a lot of conversations about foreign ownership of U.S. real estate. What we’ve tried to do over the course of the past year is really offer ourselves to legislators, regulators, and others who are looking to develop policy around this issue as subject matter experts. Notably, we don’t take a position on any of the legislation being considered in the space—again, because we’re not foreign policy experts. But, you know, whether you think these bills are good or bad, or right or wrong, there’s a lot of conversations happening around this. They’re going to continue. And so from our perspective, it is really important that whatever policy is developed and whatever laws are enacted, they fit within the current system of real estate transfer so that you don’t run into unintended consequences and you’re not adding risk for American real estate and landowners. If you think about it, besides a place to call home, real estate really represents one of the greatest generators of wealth in the country. So whenever you’re talking about shaping real estate policy, how you do that really matters. It matters to millions of everyday Americans. And so what we want to do is provide some subject matter expertise to make sure that there aren’t unintended consequences. And we think that can be accomplished by adding some procedures and protections within this legislation. And the good news is, there’s a lot of existing real estate law that can be leveraged for that purpose. So I’ll talk a little bit about some of the legislation we’ve seen. And it’s been extensive. So about a year ago all of a sudden we started seeing a lot of legislation pop up on this issue of foreign ownership of U.S. real estate. And to date, fourteen states have enacted legislation. Some states have enacted several bills. And this is—this is just last legislative session, so last year. And then most recently in Missouri, there was an executive order issued on this subject. Two states have enacted legislation for study committees on the topic. And as of right now, there are almost 150 active pieces of legislation in over thirty states moving on this topic. So it is a lot to track. As Irina said, we track all the legislation related to really real estate, title, and mortgage. And when you think about different topics, this one is just sort of off the charts in terms of the number of bills that are out there. Notably, there’s really no model legislation that has emerged in this space. But all the bills that have been introduced or enacted do two main things. One, they identify restricted parties. And, two, they identify impacted land or real estate. So in these bills, a restricted party could be a foreign government, it could be an entity, it could even be an individual. And the impacted properties could be anything from just agricultural land, to property that’s adjacent to or in a certain radius of critical infrastructure or military bases, or, in some cases, it could be all real estate within the state. So just to kind of give you an idea of the bills that passed last year, six dealt just with agricultural land, two with critical infrastructure, four with a combination of those two, and then eight touched on real property throughout the state, to some extent. So with these two elements, there are some challenges that come in with definitions. When you’re talking about these restricted parties, there’s not necessarily lists available to know who exactly is a restricted party. Some states have addressed this by pointing to federal lists, such as the Department of Commerce’s foreign adversary list, or the Department of State has a countries of particular concern list. But, you know, that has been a challenge. And you would think sort of definitions around real estate would be kind of straightforward, but unfortunately, that’s not as straightforward as you might think. For example, property that is considered ag land or farmland today can literally be a strip mall tomorrow. And conversely, property that’s not farmed today can be farmed in the future. And, you know, today we also have a lot of urban farming on land that is, you know, definitely not considered traditional agricultural land. Likewise, it’s really hard to figure out what properties are within a certain radius of critical infrastructure or military bases, even knowing where all of those places are. You kind of have to put together a map, and map that out, and survey. And, you know, there may be all sorts of reasons why you wouldn’t want to do that. So there’s definitely some definitional challenges as you look at this legislation to definitely be thinking about. Unfortunately, the more sort of focused and narrow the legislation is, the harder it is to sort of sort through some of these aspects. I mentioned unintended consequences. And I want to talk a little bit about what that might look like. And I will preface this by saying the majority of unintended consequences we think about from our perspective have to do with legislation that simply voids transactions. So rather than a divestment process of some sort, there’s legislation that says, you know, whether a transaction with a, you know, restricted party happens in the future, and in some cases in the past, that transaction is just simply void. Well, that creates some problems, because obviously, the local land records are going to show something different than that. So, you know, think about it from a consumer perspective. You have a seller who unknowingly sells property to a restricted party at some point. That transaction is considered void. Presumably, the property would revert back to the seller. So at that point, does the restricted party, you know, have reason to sue the seller for false enrichment, or others who were part of the transaction? From a business standpoint, liens that are on properties owned by restricted individuals that are, you know, transactions later considered void are unlikely to get paid. They’re not going to get paid. And those liens could be anything from a mortgage, to a mechanics or construction lien of some sort, or a tax lien—for all of those the local officials listening in today. And so, you know, that becomes a challenge, and that those liens are unlikely to be covered at that point. You know, if a transaction is voided, basically what a lienholder has is a note, but there’s no property to secure that interest anymore. From sort of an economic standpoint, transactions that are voided bring into question who owns the property. So, as I said, presumably the transaction’s voided, the property goes back to the seller, but the land records are going to show somebody else owns that property. And so there are serious questions about who has rights and responsibilities as it relates to that property. That kind of puts the property into limbo and creates clouds on title. That’s going to make that property unmarketable in some ways, really hard to transfer in the future. It certainly is going to impact the value of the property. So that’s obviously something to think about from a real estate standpoint and just an overall economic standpoint. And then, of course, I would be remiss if I didn’t mention that, you know, we are concerned about the liabilities some of these bills might cause for real estate professionals, whether you’re talking about a realtor, a lender, a title professional, or arguably even a county recorder. So those are some of the concerns that we have with legislation. I’ll talk about, just high-level, a few things that that we think can help address these concerns. I will say though, at the outset, I think we can expect a lot of changes going forward, right, in terms of what this policy looks like. This is a very new issue. As I said, there’s no—there’s no model that’s emerged. I think there’s going to be a lot of lessons learned as states look to implement this legislation. I think there’s probably been some lessons learned already. Notably, there has been litigation around some of this legislation. I assume there will be additional litigation that we will see. So that will impact things. Then you also have whatever’s going to happen at the congressional level. Certainly Congress is looking at this issue, and that might impact what states do in the future and what they’ve done in the past on this issue. So I think we can expect, you know, sort of changes and evolution in policy. And I think that that’s fine. I was talking to someone at the Uniform Law Commission recently about, you know, their process for updating model legislation or uniform legislation that’s been enacted in many states. And, you know, they do take a look after a set number of years at, you know, what’s happened, what new information has emerged. And they go back to legislators and ask them to make changes as necessary. And so we might see that happen. So there’s three main pieces we think about in terms of strengthening the policy around domestic real estate aspects. First, we think there needs to be an established enforcement authority within the legislation. There needs to be somebody within state government who has responsibility for enforcing the legislation. In many cases, that’s the state attorney general’s office. Sometimes it’s another agency within the state, depending on the type of real estate that’s been impacted. Second, we think there needs to be divestment processes built into the legislation versus just voiding transactions that have happened in the past, or may happen in the future. And that divestment process can really follow whatever is established in the state. It could be judicial foreclosure. It could be partition or receivership. Most state laws allow a restricted party a certain amount of time to divest themselves of the property. And if that doesn’t occur then there’s forced divestment after that period of time, hopefully using, again, established real estate transaction processes. And what that’s going to do is make sure that lienholders are paid, that the local land records are updated, and all that information is correct. And then finally, we really think it’s important for some protections to be built in. They need to be built in for the seller or previous owners of the property. They also need to be built in for future owners, so that, you know, the fact that the property was at one point an impacted property owned by a restricted individual should not impact somebody’s property rights down the road, a future owner of that property. I think there needs to be protections for lienholders and then also protections for real estate professionals. So that’s kind of a high-level overview. And I’m happy to take questions and dive into some of these issues in more detail. FASKIANOS: Fantastic. And, Zoe, let’s go to you to talk about the trends in Chinese global investments, and how the purchase of land and other assets in the United States has changed over the years. LIU: Yeah, sure. Thank you, Irina, for inviting me to do this. It’s truly a pleasure to, and I’m always happy to work with our state and the local legislators. So, you know, what Elizabeth just to described from a high level, in particular a lot of these reasons—the legislative changes or updates with regard to land, including farmland and real estate investment, or property in general—a lot of these really happened, I would say, starting from the past year, in particular. There was this one particular transaction. If I remember correctly, it was this Chinese company called Fufeng Group. Its U.S. subsidiary made an investment—or, purchased about three hundred acres of land in North Dakota. And the piece of land that this Chinese company purchased happened to be about twelve miles from the Grand Forks Air Force Base. So basically, it’s about a ten minutes’ drive by car. So I think it matters in the sense that first—from two perspectives. The first piece is, it’s important to understand who is the foreign investor which could become the asset owner of a particular piece of U.S. asset. And then, secondly, it also matters in terms of both national security perspective as well as in cases—in particular, in cases where CFIUS—which is the federal level panel of government agencies that review the national security implications of foreign investment in the United States—in cases where CFIUS do not necessarily have jurisdiction, then perhaps local legislators and state legislators can actually step in and fill the gap. So I wanted to just sort of first talk about, you know, who—why the individuals matter. You know, in this particular case that I talked about, the Fufeng Group, it’s a private company. And it’s, you know, based in China. But the reason why this triggered a national security concern is not necessarily because of the state ownership, but because this investment is related to a piece of the Grand Forks Air Force Base, which is reportedly to be home to a U.S. top secret drone technology base. So from that perspective, is there is this inherent—despite that this is a private Chinese company, the nature of the investment, in the sense that it’s—the location is in the proximity to a top-secret military base, makes this—from a national security perspective, triggered concerns. But in this particular case, CFIUS really did not have the jurisdiction in terms of rejecting the investment. Therefore, the investment could have moved forward. But what ended up happening, or obstructed the investment, was that actually local officials also reacted and took matters on their own hand. In particular, the city council sort of stepped in and say that, well, you know, despite that perhaps the city council may not necessarily directly have the authority to revoke the transactions, or so on so forth, there are other ways that the city council can actually do, such as the granting permit, or developing infrastructure, and so on, so forth. So there is this kind of disconnection—or, in other ways, it’s not necessarily, like, disconnection in the sense of what national security might—what national security concerns might mean for the local legislators, right? So the Fufeng Group—the Fufeng investment was a private company. And then that does not necessarily mean that all Chinese investment in the United States or all Chinese asset owners in the United States are, you know, not state-owned. In fact, there have been a lot of state-led investment from China in the United States. And a particular group of investors would it be the state-owned institutional investors, such as China’s sovereign funds. The most influential one would it be this group called China Investment Corporation, which is now the world’s second-largest sovereign wealth fund. And the size, as of the end of last year, the total assets under management of this state-owned institutional investor, China Investment Corporation, or CIC, was more than $1.1 trillion. In other words, the size of the asset under management by the state-owned investor is bigger than the GDP of Saudi Arabia. So from that perspective, you know, if you look at how these companies—how China’s state-owned institutional investors invest in U.S. assets, they will invest in not just in real estate. They also invest in startup companies in companies that have critical pieces of technologies that are to the interest of the Chinese government. So from that perspective, you know, not we—from local governments—from local legislators’ perspective, you need to know what—you need to know not just national security concern at that very high level, but you also need to know who is the investor or who are the potential asset owners. And then from that perspective, the inherent debate, perhaps, many legislators, especially at the local level, you are facing, is the promised job delivered by foreign investment versus the national security concern, because, you know, obviously, coming with foreign direct investment, there will be job created, there will be infrastructure being upgraded, and so on, so forth. So if the investment were to be blocked for national security concerns, then that also perhaps means the jobs were not necessarily going to be generated. Therefore, it perhaps would work if there were the so-called white-knight leaders that could have potentially step up when there is undesired foreign investor try to secure a piece of strategic asset, viewed as strategic from either federal or local perspective, and as a counterbalance, try to sort of defend against undesired foreign direct investment—foreign investors. And then finally, if I can just conclude by quickly saying that, you know, despite there is this whole panel of CFIUS review at the federal government level, again, I wanted to emphasize that CFIUS do not always have jurisdiction over every single piece of investment. And on top of that, could have foreigners, foreign investors, try to bypass the CFIUS review process? There are ways that foreigners could potentially do that. And one way to do that is to set up joint ventures by partnering with a U.S.-based company or U.S.-based institutional investor, so that the joint venture from a review—from a regulator’s perspective, this investment is made by a domestic entity rather than a foreign entity, despite the source of money comes from foreign investors. So, this—again, this ultimately relies upon deeper scrutiny from actual—the recipient of the investor, whether it is a local company or it’s a local government—it’s a local land managed or owned by a local legislator. So know your investor, and know the source—ultimate a source of money actually matters a lot, too. I will just stop there. And happy to answer any questions. FASKIANOS: Thank you both. Now, we’re going to go to all of you for your questions. And we also encourage you to share your experiences as well, because this is a forum for you to exchange your ideas. So with that, of course, we are on the record. (Gives queuing instructions.) So let’s go first—we have a raised hand from Mayor Mark Allen. Q: Hello. This is Mark Allen. Can you hear me OK? FASKIANOS: Yes. Q: OK. Thank you very much for having me today, for your discussion. Just wanted to chime in a little bit on foreign ownership within America. My state rep—she’s a state senator, Donna Campbell. I know she introduced some legislation during the most recent legislative session in Texas to prohibit foreign ownership of land in Texas. I’m not sure if her bill did ultimately get approved and voted on. But, you know, I do have a little bit of concern about that. We do have, you know, two projects going on in my city, which is a little bit east and northeast of San Antonio. And we have an existing factory that—it’s called Aisin AW. And they build transmissions for Toyota. And so they do have a Toyota factory that builds Toyota Tundra trucks down in San Antonio. And so what they do there is they build the transmissions there in our site, in Cibolo, and they, you know, put them in trucks and bring them on down there. But we do have another prospect. And they’re from South Korea. And they’ll be making electrolytes for Tesla. And so we’re—we still haven’t finalized the deal, so I can’t name the company. But we are, you know, a little bit concerned if there is, you know, like, a restriction on ownership of the land. Because I know that Aisin AW, it’s a company based out of Japan. And they did buy land in our city, in Cibolo, and then annexed into our city. And I’m assuming that the—our South Korean partners would be interested in doing the same. And so if this legislation does happen to go through in Texas, I just wanted to know if there’s any federal laws that would potentially trump that law that Donna Campbell, you know, put forth, or if there’s any compromise that could be made where the landowner, which could be an American, they could rent to the—to the foreign company. So that seems to me like a win-win, because the landowner would have a nice tenant there, with I’m sure they’ll make a pretty good amount of money on the rental situation even if it’s a long-term, you know, twenty, forty, maybe even sixty-year contract. So, just wanted to get your opinions on if there’s anything on the federal level that might trump what Donna Campbell is trying to do there in Texas. FASKIANOS: Who wants to—Elizabeth, do you want to go? BLOSSER: Yeah, I’ll jump in and just share that Texas is not on our list of states that enacted any legislation last year. So I know there’s been a lot of conversations at the state legislature there. I anticipate there will be additional conversations. You know, in terms of things happening at the federal level, whether it be legislatively or existing law, I think there are some good questions. There’s certainly a lot of questions that have been raised over fair housing. That would be less of sort of this business type of transaction, but more, you know, restricted parties being individuals and impact on residential real estate. I think a lot of these questions are going to be considered by courts and decided in the courts. And so I would—I would not even hazard to guess how that’s going to go. But there will be some impact there. In terms of the leasing question, I would just—like, some of these bills do include language regarding leasing. So I would take a look at that. And again, you know, in terms of who’s a restricted entity and what’s impacted property, it’s been a really wide variety of, you know, restricted parties. So it could be just government—foreign governments, right? And then they could be specifically laid out. Or it could be just certain types of foreign entities. So there’s a wide variety of impacted both property and restricted parties. So, you know, it’s kind of hard to say, but, you know, certainly we’ve heard too about, you know, the pending projects and other things. And I think Zoe did a really good job laying out sort of that balance on that point. LIU: If I can just quickly chime in here. I personally do not think that there would be any federal political willingness to—a political willingness to stop or obstruct this type of—at least from CFIUS perspective—this kind of investment, I mean, would not—would not be—would not be under the same type of national security review process, because neither Korea nor Japan are treated the same way as China, because they are U.S. allies. And then on top of that, one beneficiary—one beneficial factor would be the Inflation Reduction Act, which is very much in favor of localizing or near-shore and friend-shore and onshore a lot of the manufacturing product, and in terms of facilitating the renewable transitions. So from that perspective, I do not think there will be any federal obstruction in terms of making the—obstructing the investment. But there is the FIRRMA, the Foreign Investment Risk Review Modernization Act of 2018. So, FIRRMA expanded the scope and the reach of CFIUS. It include—sort of, it has the authority over certain transactions, including undeveloped land in proximity to facilities that are considered as sensitive for national security concerns or connected to critical infrastructure, critical technology, and so on, so forth. So from that perspective, unless the specific investment made by Toyota or the Korean company has any kind of that problem, I do not think existing legislator or the new legislature would potentially trigger any kind of obstruction. But, you know, Elizabeth can correct me if my interpretation of the legislation is wrong there. Q: Yeah, thank you very much for your answer there. We do have an Air Force base in the area, Randolph Air Force Base. And so it is within ten miles, for sure. So that could be a bit of a concern. But I think with them being friendly nations that we should be OK. LIU: Right. But the CFIUS did, I think, last year, right after the Chinese company investment—Chinese food company investment case, CFIUS did add a couple more U.S. Air Force—just U.S. military bases on sensitive—on the sensitive list. So you might want to check if your military bases is on that list. Q: Thank you very much. BLOSSER: I’ll just also throw out there, because I don’t think it’s been shared yet, but generally the countries that are listed in the state legislation that’s been introduced or enacted are China, Russia, North Korea, Iran, Cuba, Venezuela, Syria. That’s kind of—pretty close to comprehensive list. So those are—those are the countries that usually are referenced in the legislation. FASKIANOS: Thank you. I’m going to go next question from Justin Bielinski, who is the director of communications in the office of Wisconsin Senator Chris Larson: What is the best source of data to find out what level of foreign asset ownership exists at the state and local levels, and to compare how your state, community stacks up against other U.S. jurisdictions? Elizabeth, do you have that—those sources? BLOSSER: That is a great question. And I don’t think that there are necessarily great sources for that data. As I mentioned, Mississippi and South Dakota passed legislation to do a study on these types of things. It’ll be interesting to see what data comes out. I don’t—you know, I don’t think it will be possible to go into a state and try and look at all the land records and figure out things like beneficial ownership and the, you know, status of individuals who own various property. Maybe you can take a segment and study that and get that information. So, you know, I have seen some studies come out. I know the National Association of Realtors puts out some information annually on this topic. And I’m not exactly sure how that information is gathered. From a title perspective, we certainly do not gather or retain that type of information. And then, of course, it’s strictly prohibited and illegal for us to ask about country of origin, or political affiliation, or things of that nature in a real estate transaction. I don’t know, Zoe, if you have other data sources. LIU: I was going to mention the National Association of Realtors, their annual report. They basically talk about, you know, to what the level of the transaction—what are the levels of transaction, whether they are—you know, what type of investment, whether they invest in—or, they purchase in existing homes or new homes, or to what extent the transaction is made by cash. And if all transactions are made by cash, then there are kind of further financial security, or safety, or legal implications. And then in terms of farmland investment, I think USDA—the Department of Agriculture, USDA, the Department of Agriculture does have this farm service agency. They put out an annual report on foreign ownership and foreign investment in U.S. agricultural land. So they would show, like, which countries are the largest share of—which country owns the largest share of U.S. agricultural land, and how much. So that would be another source. In terms of—in terms of just the generic foreign investment at the federal level, and to what extent it triggers a CFIUS review, CFIUS does have annual report. I think they have done the 2023 press release. But I don’t think the 2023, like, statistics is out yet. But CFIUS do have annual report. But I would—in general, I would agree with Elizabeth that there is really a lack of comprehensive data sources that allows for just a direct oversee who owns what and in what types of asset. Then if you—if you broaden the definition of—which, if we just take a holistic view of foreign asset ownership in the United States, then this asset can include financial assets, that include U.S. Treasurys, corporate securities, or any other types of financial investment. And for those type of data at the federal level, especially for U.S. Treasurys ownership, the Treasury Department published numbers on that, and then the Federal Reserve also have comprehensive data in terms of who—what types of foreign investors owns what type of U.S. financial assets. FASKIANOS: Thank you. I’m going to take the next question from Mayor William Lewis of Havelock, North Carolina, with a raised hand. Q: All right. Can you hear me good? Can you—OK. FASKIANOS: Yes. Q: Cool. Yeah, Will Louis, down here in eastern North Carolina. We have Marine Corps Air Station Cherry Point. And one thing you guys have not mentioned that we’ve seen a little bit of a trend on, particularly around our training ranges where there are some really, really large properties that are available, is this digitizing property rights. Where they’re selling—where we have one organization that is an American organization that is using foreign money to digitally purchase properties, and then sell NFTs based on those properties. And I don’t know—I haven’t—in all the things I’ve heard about CFIUS, and doing research on that, that’s a different level of scrutiny. And, you know, that can be changed so fast at any given time that you don’t even know who does own a property. And being able to protect those pieces around the range. Have you guys heard anything about that, or have any insight on what levels of scrutiny that may require in the future? And just for reference, we have a project right now that in the next month may get sold that way, that is literally right next to our ranges. And if you present the company to CFIUS for review, they’re an American company that just sells the digitized pieces of the property. So a whole different level of concern. BLOSSER: We could probably do a whole conversation on NFTs and real estate, and what that looks like. You know, this is an issue the Uniform Law Commission is looking at, and others. You know, my understanding of the process is basically you have an LLC that owns properties, and then really you’re transferring the LLC versus the property. And so that brings up lots of questions about local land records. And so it’s a big—it’s a big conversation. I will say, as somebody who’s a board member for the Property Records Industry Association, you know, the way that we do land records in this country is very unique. And it is very local, where those records are kept at, generally, the county level, local government level. You know, to protect people’s property rights, they record on the local land records, and that provides constructive notice. And really, that’s been the backbone of property ownership in this country for hundreds of years. And, you know, is it a perfect process? No, absolutely not. Is it arguably the best process out there today? Yeah. So I think when you start talking about NFTs and that piece, there’s a lot of issues that get pulled into that. But that’s a really interesting perspective. And, frankly, something I’m going to do some more research on, and educate myself more on. LIU: I really do not have too much to add here to the conversation, you know, besides what Elizabeth just mentioned. But one thing that struck me was a lot of the—a lot of the transactions could potentially be made by cryptocurrency, not just for—obviously, not just for NFTs, but also for the transaction of a particular real house. Like, you know, they—in the transaction, the property owner would just say that she or he would be happy to take cryptocurrencies. And that—for me, that is something very interesting, because it has direct implications for tax payment and a lot of things like that. So far, I mean, I’ve never made a transaction using cryptocurrency and I really do not know what are the implications for taxation. So perhaps, you know, for Mayor Lewis’s office, you need to, you know, take the entrepreneurship and pioneer work to help us understand it better. FASKIANOS: Thank you. I’m going to take the next question from representative Aundré Bumgardner, who is Connecticut house assistant majority leader: Maine stands out among U.S. states for its high percentage of foreign-owned land. Why is this the case? Elizabeth, you want to? BLOSSER: I don’t know that I have a good answer to that one. I don’t know what the—what would necessarily be a driver of that. LIU: If I can—if I can quickly chime in here, just very briefly. I mean, I did—I’ve done research in food security. And as far—if I understand this correctly—and please do correct me if I’m wrong—if I understand it correctly, that a lot of the foreign-owned land again in Maine, a lot of this is related to farmland, and a lot of this is related to concerns with regard to food security. And there are—it’s probably worth looking into who are the owners of land in Maine. My guess is that, given that China, just in the grand scheme of foreign-owned U.S. agricultural land, China’s ownership is less than 1 percent. So probably, China’s ownership and may be minimal, whereas countries like Canada looms large in the—in the totality of the picture, and the geographic proximity perhaps makes sense, both from food security perspective, as well as invest just for the resource such as timber. FASKIANOS: Thank you. And he had a follow-up question: Why do we see more foreign ownership of U.S. agricultural lands than we do from Black, indigenous, or Latino farmers combined? How does U.S. policy through the farm bill shape this phenomenon? And again, I don’t know if you study this, Elizabeth, or you’ve been following this. BLOSSER: Yeah. You know, again, sort of data on some of this stuff is limited to get a big picture. A lot of times, state-by-state, people have a good view on this. I do think, going back to kind of discussions in Congress, there are a lot of conversations about this issue, specifically as it relates to agriculture. You know, I would not be surprised to see legislative language make itself—and, you know, its way into to the farm bill, especially given that the Government Accountability Office, the GAO, recently released a report just within the last couple of weeks kind of talking about concerns about communication breakdown between the USDA and CFIUS. So, you know, I could—I could see some policy on the federal level come down through the through the farm bill. You also might see something come through the National Defense Authorization Act, the NDAA. LIU: Elizabeth, you just reminded me in terms of the legislation, restrictions in terms of foreign ownership of U.S. land. Like, not all state has legislative restrictions against foreign ownership, which is—which reminds me of the earlier question with regard to Maine. If I remember it correctly, I don’t think Maine has foreign—has restrictions against the foreign ownership. But it—although it did have procedures to say, if it’s a foreign investor, if a foreign owner, you have to report it. But there is no restrictions. But, you know, a lot of these legislative changes over the past year would mean that, you know, perhaps more state would enact additional foreign ownership restriction laws, or even become more restrictive. But just a thought. FASKIANOS: Thank you. In the Q&A there’s some resources. Evan Meyer has shared an article that you might want to take a look at. And Zamora Gaston, legislative assistant for Representative Marcus Evans from Chicago, Illinois, is—responds to Justin’s question: In Illinois, certain foreign persons have to disclose their agricultural land holdings to the Illinois Department of Agriculture. And there is a bill that has been proposed during this session that will require the Illinois Commission on Government Forecasting and Accountability to provide to the legislature a report that details noncitizen purchases of real estate, and percentage of noncitizen-owned real estate, and offers recommendations to make it easier for citizens to purchase real estate. So that might be legislation that other states might want to look into raising, passing. There is a written question from Joshua Ward—Councilman Joshua Ward from Pemberton Township in New Jersey: Being that we live right next to McGuire Air Force Base and we have farmland that is owned by foreign entities, it raises concern for my local citizens about this. Is there a way local municipalities can ask for assistance in investigating concerns? BLOSSER: You know, I think those are conversations to have with your state elected officials in terms of, you know, what policy is coming down the road. But sort of the last conversation reminds me to say that, you know, sort of restrictions, especially as it relates to ag land, aren’t necessarily new. We saw a whole slew of bills get passed last year but, you know, there’s bills—or, legislation that’s been on the books, you know, back to the ’80s, and before, regarding reporting or review of certain transactions by, you know, a state’s department of agriculture, or others. So I would also check to see sort of what maybe some of the requirements in your state currently are. FASKIANOS: So I’m going to ask a question. How do you balance legitimate national security concerns with legislation that might discriminate against individuals of certain national origins? LIU: I guess it’s really hard, because it seems to me that a lot of these national security concerns, so it’s specifically directed against undesired investors, that are either U.S. rivals or U.S. competitors, or entities that are—entities or individuals that are under U.S. sanctions. So it’s very easy for the—for investors—for the investment process, meaning the law firms and the companies that are the recipient of the investment, to be—to self-select themselves outside of the investment process. So from that perspective, I do not—I really do not have a good answer, Irina. FASKIANOS: OK. Let’s go next to—oh, Zamora Gaston has a raised hand. So follow up. Q: I was wondering—Zoe touched on this earlier—about investments from foreign nationalities and startup companies, or businesses in general. I was wondering if there was any congressional oversight or what state-led legislation that you would suggest we look into. LIU: Thank you for the question, Zamora. Right now, there are there are—there are I don’t know how many bills in Congress that are specifically targeting China. But the direct, most relevant piece of a process would be the CFIUS national security concern review process. And in order for the review process to be triggered, the—it has to either satisfy national—it has to satisfy a certain percentage of investment, and in a particular company. And that particular company would also be of strategic relevance, or in an industry that are relevant for national security. Now, in the current political scenario, everything can potentially be national security concerns. So, I would anticipate a lot of additional, more stringent CFIUS reviewing processes against Chinese investment, specifically state-led investment, coming up. In terms of how local legislators can respond to this, I mean, this is really—this is really a calculation that local legislators you need—you would have to have the conversation among yourself, and with your—with your own constituencies. Because, again, who are the investors matters, and to what extent these investors, whether they are Chinese, they are Russian, they are from the Middle East or elsewhere—to what extent they have state connections. The point here—the reason I wanted to make this point is because not all investment—not all, you know, foreign investment in the United States from U.S. competing countries are state-owned entities. And there are private company that really just want to invest for business purposes, right? But the over-securitization of investment make things very difficult. Therefore, you would really have to have a serious conversation in terms of what are the—what are the priorities? Do you think the job being created, the tax revenue being generated, is—basically, the benefit, like, outweighs the potential risk? And if you do think—you do value the benefit, then what are the countermeasures that you can compartmentalize the national security risk? In other words, you take the investment but how are you going to safeguard the national security concern that, you know, CFIUS or other people who are opposing the investment might raise? You know, part of this could be through, like, a contract. You can have specific, concrete terms by saying that, you know, there should not be forced technology transfer, and so on so forth. So this is really a conversation that you would have to have with your own constituencies and figure out is the national security concern a real concern, and then do you have the countermeasures that can balance out the potential national security threat. Q: Thank you so much. FASKIANOS: Thank you. Zoe, to build on that—let me see. Wait. We might have—Vice Mayor Ted Bui from Fountain Valley, California has a question: Foreign entities that are here on an EB-5 visa, are they a concern as well? And, second, are we only concerned with entities that are here from China, or are there other countries as well, like Vietnam? LUI: I can chime in on this, and Elizabeth can correct me and enrich the conversation. So on the EB-5 visas, this is interesting, because with EB-5 visas you really apply to business and business individuals and in the context of China in particular these are usually rich individuals who are—who want to eventually migrate to the United States. So from that perspective, as long as—you know, as long as you have a clean understanding of this person’s source of money, and the connection, and the company’s capital structure—meaning to what extent—again, it’s know your investor and know the business person. As long as you have a clear understanding of the ultimate source of money, there is a high chance—there is a high chance that a lot of these projects coming from a private individual may be from somebody who wanted to, you know, eventually migrate to the United States. Therefore, the national security concern would be not as severe as a state-owned enterprise investment. And then, I would say that not just China. Right now the reason why China becomes a national—Chinese investment become a national security concern was because a lot of the—a lot of the demonstrated patterns by—at least, viewing from Western investor—Western policymakers and Western companies perspective—China tend to have strategic motivation, or their investment is not necessarily just for pure financial returns. And the Chinese—the strategic nature of Chinese investment also not only apply to U.S. companies, but also to their investment in other companies—in companies in other countries as well. One good example, would be 2015 Chinese company’s investment in a German robotic company called KUKA. And this Chinese company, again, it’s private. It’s called Midea. It’s basically a Chinese appliance maker. It has—it does not make anything advanced, like, you know, weapons or anything. No, it just, like, make refrigerators, or toasters, or coffee machines. But this company is very interested in making itself a pioneer in smart home appliances, like smart appliances. Now, whenever—now, when everything touched upon the issue about “smart” or “chips,” now it started to touch upon a series of other things. Like, you know, do you want your coffee machines to start spying on you? Things like that. But I’m not saying that, you know, the Chinese appliance makers are doing that. But those are the kind of concerns in countries like the United States and—or Western companies. And when you—when a Chinese company, even a private company investing in a robotic—in a piece of company that are strategically—yes, it is very much of the German industry’s strategic concern. The reason why the process could go forward, could go through, was primarily for two reasons. First, in Germany there was no other competing bidders willing to offer a counter bid. And then, secondly, at that time, Germany did not really have a robust investment screening process. But from the U.S. perspective, we really did. We have a robust review process. And oftentimes, we can mobilize our private investors to sort of offer a counterargument. Now, not just to China. There are other countries like Russia, as Elizabeth mentioned earlier, from other countries that are considered as U.S. rivals. But I’m not exactly sure about Vietnam, because Vietnam is very much a beneficiary from a lot of this supply chain diversification. BLOSSER: Yeah, I’ll chime in. Again, you know, we don’t really comment on the foreign policy, you know, who should and shouldn’t be included in these bills, what—and, you know, impacted property should or shouldn’t be included in in the bills. But this kind of goes back to what I said earlier about definitions matter in this legislation. Like, how do you draft definitions that are somewhat evergreen, right? You’re putting this into law. That really gets to what you’re trying to accomplish on a foreign policy front, whether that be around the restrictive parties or the impacted properties. And that is difficult. I don’t think there are great answers to that. Like I said, you know, some states have, you know, referenced the federal lists, which sort of narrows it down and allows you to deal with sort of changes over time. In terms of Vietnam, I don’t recall off the top of my head them being listed in any of the bills that I’ve seen. FASKIANOS: Wonderful. Well, we are at the end of our time. Thank you very much to both of you for doing this—Elizabeth Blosser and Zoe Liu. We appreciate it. And to all of you, for your questions and comments. We will send out the link to the webinar recording and transcript, as well as other resources. You can follow Elizabeth on X at @EABlosser, or you can also follow the American Land Title Association at @ALTAonline and Zoe at @ZongyuanZoeLiu. Zoe is also a contributor to CFR blog Asia Unbound. So you can sign up for that if you wish to receive notifications for that at CFR.org. And, as always, we encourage you to visit CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for the latest developments and analysis on international trends and how they’re affecting the United States. And we also encourage you to share your suggestions for future webinars by emailing us to [email protected]. So, again, thank you all for joining us today. We appreciate it. (END)
  • Aging, Youth Bulges, and Population
    Responding to Demographic Trends
    Jess Maurer, executive director of the Maine Council of Aging, discusses demographic trends in Maine and the work of her organization. Jennifer Sciubba, global fellow at the Woodrow Wilson International Center for Scholars, discusses demographic trends and the implications of an aging population at home and abroad. A question-and-answer session follows their opening remarks.  TRANSCRIPT FASKIANOS: Thank you. Welcome to the Council on Foreign Relations State and Local Officials Webinar Series. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. CFR is an independent and nonpartisan membership organization, think tank, and publisher focused on U.S. foreign policy. CFR is also the publisher of Foreign Affairs magazine. And CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. Thank you all for being with us today for this discussion. The webinar is on the record. We will circulate the video and transcript and post it on our website after the fact at CFR.org. We are pleased to have with us today Jess Maurer and Jennifer Sciubba to talk about demographic trends. We’ve shared their bios with you, but I’ll give you a few highlights. Dr. Jennifer Sciubba is a global fellow at the Woodrow Wilson Center. She’s an expert on demographic trends and their implications for politics, economics, and social relationships. Previously, she worked for the Hess Center for New Frontiers at the Center for Strategic and International Studies and was a tenured professor at Rhodes College. Dr. Sciubba is the author of 8 Billion and Counting: How Sex, Death, and Migration Shape our World. Jess Mauer is the executive director of the Maine Council on Aging, which she co-founded in 2012. The Maine Council on Aging consists of over 135 organizations, businesses, municipalities, and community members. Its recent achievements include increased pay for direct care workers and increased eligibility for the Medicare Savings Program in Maine. And Ms. Mauer previously worked in the Maine office of the attorney general for nearly two decades. So thank you both for being with us. Jennifer, I thought we could begin with you to give an overview of the global demographic trends you’re seeing and their political, social, and societal, and economic implications. SCIUBBA: Absolutely. Glad to do so. And I have just a few slides to show and tell a little story, if we can pull those up. Perfect. Let’s go to the next one, but it might even—that one might be blank, and it might be the one after that. Perfect. Let’s start there. So pop back one to the star. So let’s think about that.  I love this, the idea of the night sky as a metaphor for understanding global population. Because I remember learning—I had to take one science class in college as an International Studies major. And that one science class was astronomy. And I was so fascinated in learning that when we look at those stars in the night sky, some of them are so far away from us that they don’t even exist anymore by the time their light reaches us here on Earth. And when I think about where we are in this moment of global population trends, I think it’s a lot like that night sky.  In parts of the globe, the human population is already or will soon be shrinking. And that’s really different from what we hear all the time. We hit eight billion globally in November. And Irina mentioned, that’s the title of my most recent book. And we know that we are continuing to see global population grow. But what I don’t think everyone grasps is that while those overall numbers are increasing, there’s a tectonic force underneath that is leading us towards shrinking. It’s kind of like looking at a star that seems to be shining brightly, but in actuality it’s already imploded. And so to understand where we are today in terms of global population, and where we’re going, I want to explain first how we got here. And what I hope you’ll take away from this few minutes that I have to speak with you is thinking about the night sky as representative of our soon-to-be shrinking population is that it is a trap in data analysis. And so I’m actually going to talk about two traps and data analysis and how they relate to demographics, that I think can help us understand how to incorporate demography into our larger planning, which is exactly what I hope you’re all doing at the state and local levels. So let’s go to the next slide, please. Alright, so how did we get here? There are just three ingredients to population change. So that’s all we have to wrap our brains around, and that’s fertility rates. We typically talk about the average number of children born to a woman in her lifetime. Mortality rates. Think about us dying. And, of course, migration. And if we’re at the global level, like the whole planet, migration doesn’t much matter. We don’t have other species coming here yet. But when we zoom down, it matters a lot. And I know to a lot of you on this webinar it matters a great deal for what determines population change at your local level, whether it’s in-migration or out-migration there. So where else did we—how else do we get here, putting these components together, particularly the births and deaths? Next slide, please. A quick overview of our human history in thirty seconds here. It took from all of human history until around the year 1800 for Earth to amass its first one billion people. But as we started to get control over that second variable on that preceding slide, over death, we started to see populations boom. In particular, we were able to help infants and children live to reproductive ages. And that allowed population to boom. If you’ll click one more time you’ll see that it actually boomed from 1.6 billion at the start of the century to 6.1 billion by the century’s end.  And I want to flag this as a moment to understand that probably for everyone on this webinar—maybe a few of you who are in your early twenties not so much—but this is what you were born into, right? I know this is what I was born into. We were born into this context. And when I talked about traps—you know, a little hint about the traps in data analysis, this is one part for us to take stock. What kind of world were you born into? What kind of messages were you receiving about population? We’re going to think about how that colors our view of it. Next slide, please. We’re not just talking about size of the global population. We’re talking about a shift in the composition of the global population as well. So what you see here, they’re commonly called population pyramids because they actually used to all be shaped in this little pyramid, like 1950s, but maybe more accurately called population trees now because they’re actually turning into more of trees. And it’s typically males on the left, in the blue, females on the right in the red. And we see age groups in the ascending order there. So it’s thin at the top in the 1950s. Not a lot of folks living to be over ninety, a hundred years old. And we see that it’s fatter at the bottom. And if you think about where people of reproductive age, particularly women of reproductive age, would be located on that pyramid, and you see that it’s fatter at the bottom, you know that your fertility rate—the average number of children born per woman—was over replacement level. By the time we get to 2023, we now have a total fertility rate globally of 2.3 children per woman on average. And that’s really close to replacement level of 2.1. And where we’re headed is a more tree-like structure. Next slide, please. That mirrors what happens at the country level. And so still today there are countries in the world that do have high fertility rates. In case you thought I was off my rocker in talking about shrinking populations and forgetting about places like Nigeria, or Tanzania, Ethiopia. No, that’s certainly still the case. But there are fewer of them. There are only about eight countries left in the world, out of two hundred, where women have five or more children on average. That is a complete sea change from 1960s, when it was, you know, about 130 countries. So the shape of Turkey’s population today looks a lot like the shape of the global population. And if you’ll click one more time you’ll see that Japan’s population has that tree-like structure, with lots and lots of folks at those older ages and fewer people at the younger ages. So the next slide, we’ll see why that happened. I said there were tectonic forces at work all along. Well, here they are. Since the 1960s, the rate of global population change has been slowing. And so what we end up with, next slide, is that in 1968 lots of women—lots of countries had high fertility. Very few had two or fewer children on average. And now, we click again, and we see that very few have high fertility and that two out of every three people on the planet live somewhere with below replacement fertility. And nearly half the countries that are above replacement, are only just above it, with women having fewer than three children on average. So we’re part of a global trend. And I think this is a spot for us to pause and think about why it matters. And that, you know, we’ll get into this in Q&A because I don’t want to get into Jess’ time, but when we think about priorities, and setting priorities and policy—and I’m at the global level—then we’re thinking about how the interests of those countries that have rapidly aging and potentially shrinking populations might increasingly differ from those that still have very young and growing populations. And it’s just something that I want us to keep at the front of our minds, is how investments and policy priorities might be different in those different settings. But, of course, we all need to be thinking about demography. Next slide. Because if you are thinking about planning for education, care work, et cetera, demography matters. This is just a quick map to show you places where fertility is still higher, which are some of the poorer places on the planet, as you might expect. OK. Next slide. OK, so the first trap is getting stuck in the past in terms of our trends here. So we know that trends change but sometimes our thinking does not change. And so I want to make sure that we understand how much the global situation behind fertility has changed, like those stars. OK, next slide. And, of course, that matters at the state level as well. So state—here, I’m thinking about the United States. And we’re about to make that a very different kind of state. But we—whoops. My own little screen just did something strange. So U.S. population has been, in some ways, exceptional compared to some of its peers for a while. We had relatively higher low fertility, if that makes sense to you. So low could be anywhere from zero to two, right? And we were on that relatively higher end of low. But that’s not necessarily the case anymore, as we’ll see here. And I’m sure some of you—well, probably all of you saw the news coming out of U.S. Census in November and December of last year, that really talked about these changes at the regional and state level in the United States, and which regions are growing or not growing. Next slide, please. That, much like the slide I showed with the little baby and the death and the migration, it’s driven by births, deaths, and migration at the state level as well. So we see here in the United States, our total fertility rate is somewhere around 1.6 to 1.7 children born per woman, on average. That places us, again on that higher—still kind of on that higher end. For comparison, in Japan is probably around 1.3, maybe a little bit lower than that. So this is, you know, kind of typical of a wealthy, industrialized country. And places in the country that it has historically been lower are the Northeast. So we typically see lower fertility rates. This down here is called the general fertility rate. So it’s expressed a different way, which is basically the birth rate—births per one thousand, women fifteen to forty-four. You can see where it’s slightly higher. It’s already, I think, starting to fall again in North Dakota and South Dakota. And, but we see regional differences here. Next slide, please. And we see regional differences in terms of migration. Now, let’s—look, this is taken from the Tax Foundation. So you know that they’re trying to make the point that people are moving to states with lower taxes, but that is true, demographically speaking.  You start to peel down at the level here, and we see people are moving to Texas for jobs and cheaper housing. They’re typically a working-age population. Most of Florida’s growth came from people between the ages of fifty and seventy. So, you know, nuance is always really important with demographics there. So I would submit to you that U.S. exceptionalism is over. We have low fertility. We do have some in-migration that is propping up the size of the population, but the U.S. is facing the same set of issues and opportunities—challenges and opportunities—that other wealthy industrialized countries are. And I think it’s time we wake up to that. Next slide. And we’re almost done.  And then trap two, I just really quickly want to point out that we are all carrying biases in with demographic data. All kinds of ones. Jess has a whole other set of biases besides the ones I’m going to talk about. But it’s really important for us to recognize that. I saw it when I worked at the Pentagon. I saw the U.S.—that line about U.S. demographic exceptionalism, perfect, was talked about all the time. Yeah, you can go to that one. And I say—would often say, we’re not that different from Russia and China. Just look at the little shape of our population here. A lot of things are really similar there. And in fact, if you are a democracy and you need to pivot quickly to deal with an aging population, it is very difficult. If you’re not a democracy, it’s a lot easier.  Next slide. I also often point out that there is a sense in the United States that migration will continue forever, whether you want it to or not. That does not matter to me. It’s just this idea that this—you know, we have the world’s largest stock of migrants in the U.S. So we tend to think global migration is really high. But really, 2 to 4 percent of people live outside the country in which they were born. That’s been true over the last decades and decades. There are actually far more older people worldwide than migrants. If you look at just those ages sixty-five to seventy-four, there are about 200 million more of them than global migrants. So this is a huge segment of the global population and of the U.S. population. But I think we kind of carry some of that bias into looking at the data there as well. And so a question we might ask is, will migration continue at these levels, and for the United States, or not? And last slide for me is just to say—I got two plugs for you here. One is the personal plug. The list of you on this webinar I’m salivating over because I would like to talk to you. Sorry, Irina, but I got to give this plug. My next project, research-wise, is trying to understand how we can thrive, not just survive, economically particularly, in this era of shrinking populations. And so if anybody is talking about this at your state or local level, please shoot me an email or find me for us to chat. And then the other is I’m on the board of the Population Reference Bureau, which does a lot of data and analysis for state and local governments about population projections. And I’m sure that soon—if this is the kind of thing that you’re interested in, I’d be happy to send you their way. Thank you so much. FASKIANOS: Jennifer, thank you so much for that and your wonderful slides. And we will circulate your contact information after the fact as well, in case people did not get it on the—on the slide presentation. So, Jess, now we’re going to over to you with your experience. Talk about what you’re seeing in Maine, what policies you were looking at to prepare there. And I know you’ve been advising other governments as well as the federal government—some national governments and the federal government. So what you were saying and where you see things are working well, and any best practices you can share with the group. MAUER: Sure. And thanks for inviting me. Glad to be here. And I just learned a whole lot from Jennifer. So I’m really excited to be here. And I have questions. And I’m going to be using some of—some of this data as I talk about this stuff in the future. So if whoever is going to share my slides could do that, that would be great. And so you can go right ahead to the next slide. I just thought before we jump into the issues that we’re seeing and some of the solutions, I’d talk a little bit about Maine. So Maine is the oldest state in the country by median age. Our median age is 45.1. We’re also the most rural state, which a lot of people find interesting. And I find that when I talk about rurality, a lot of folks particularly in urban areas don’t really think the same way we do. For instance, I’ve heard people talk about a city of twenty or twenty-five thousand people as rural. So, for reference, I like to say, only nine cities in Maine have a population greater than twenty thousand. And 83 percent of Maine’s five hundred towns have a population of five thousand or less. And, in fact, 44,000—sorry—44 percent of Maine’s population lives in towns with fewer than five thousand people. We have towns, like, with five people in them. And so, you know, we have a lot of rural communities.  We also have the lowest working-age population, which creates a significant challenge. Not just for business, but also when we’re talking about the direct care workforce and a significant growing care gap that we have for populations of all kinds across all settings. So next slide.  So here’s an actual look at our demographics. We have 44 percent of our entire population—entire population—is over the age of fifty. For reference, 18 percent of our population is under eighteen. And 23 percent is over sixty-five. So, this means for the better part of the last decade we’ve had significantly more people every year turning sixty-five than we’ve had babies, and sometimes twice as many for a good three, five, or six years. We had about 24,000 people turning sixty-five and about 12,000 babies born every year. Next slide. So in 2020, we launched a three-year municipal data dashboard project to help communities in Maine understand the challenges that older people in their community might be experiencing, and to take a look at their demographic challenges generally. These were our pilot communities. Just want to say that three of them were remote rural communities. One was our—one of our largest cities. One was a midsized city, and two are sister suburban towns. Next slide, please. So these are two different data points that highlight the differences between rural and urban communities in our—in our community, in our state. One generally looks at the median age. And you can see that, particularly for urban areas, not surprisingly, our median age is lower. But in some of our most rural communities, is very high. So in Eastport, the median age is sixty-one versus forty-five, as a state average. And in that same community, you’ll see that just over 70 percent—70 percent—of the households in that community include a person over the age of sixty. Next slide. So one of the shocking, really, pieces of data that we learned when we started digging deep at a community level was that some communities do better and others do worse at supporting people later in life. So you’ll see here, one community has very few people living in their community who are eighty and older, as opposed to another community which has a much larger percentage. And the next slide is actually the data. And you’ll see that these two communities have essentially the same population of people who are over sixty-five. And so you have to ask yourself, why is one community the community that’s better for older people—which is a city setting, walkable, access to transportation, access to affordable housing—so much better for people over eighty then another, which has no transit, all single-family homes, very few affordable housing units, rural, and very few services? So these are the reasons we start, like, saying, you know, it’s really important for municipalities to look at their own data and not just rely on state and county data to sort of see how they’re doing. I will say, interestingly enough, and why it’s important, this community that I mentioned in the last slide, that has—more than 70 percent of the households have sixty and older, they have a very, very low working-age population. And they said, well, that’s because nobody can afford to live in our city anymore. And they all live outside of our city. So we did a demographic profile of all the communities around their city that they said that older people—that younger people lived in. And the reality is, they don’t live there. They just have a really, really low working-age population, and it’s something that they need to consider. So next slide. In 2022, we did a report on the economic status of older women in Maine. And the next few slides highlight some additional demographic concerns specifically related to older women. On this slide, you’ll see why it’s important to explore data by gender, race, and age. Nationally, eighty—women over eighty have a significantly higher rate of poverty due to—than men—due to gender-based wage disparities across their lifetime. But in comparison to White women, Black women or women of color over the age of eighty experience nearly twice as much poverty as White women. So these are issues we just have to look at, right? I mean, it makes a difference if you’ve just experienced gender-based bias versus gender-based and race-based bias across a lifetime. Next slide. And then to truly understand how folks are doing in your community, you also have to disaggregate data related to age. For instance, all the reports we see show poverty among older people at a rate at about 8 or 9 percent. And we can see here, however, that women over eighty in Maine experience poverty at a rate nearly twice that of men over the age of eighty. So it’s really important not just to say, how well are people over the age of sixty-five doing? But now we have to say, how well are people over the age of eighty doing in our community? And are there demographic differences again, by race, or by age? So next slide, please. So the federal poverty level is the piece that we look at when we say whether or not older people are experiencing poverty. But living alone is a clear demographic issue that has big impact for people later in life. People who live alone when they’re older don’t have a second income, right, to help cover costs, and have no informal care within the home if they need help with care. And they also have no basic help with chores. They have nobody to drive them if they can no longer drive. They have nobody to help them with home maintenance. So two times as many women over the age of sixty in Maine live alone. And women who live alone, not surprisingly, have less income than men who live alone. The next slide, please. So we look at something called the Elder Economic Security Index, which is a national index that tells us how much income an older person or older couple needs to meet their basic needs if they’re in poor condition, poor—good health, poor health, excellent health, and also if they own their own home, with or without a mortgage, or they rent. So you’ll see here, this is both the previous slide and this slide, that at least half of the older women who live alone in Maine do not have enough money to meet their basic needs, regardless of where they live, and regardless of their health status. So these are issues that also help us think about: How we target services? And what do we do, right, when we come up against this sort of issue? So next slide. I just want to say a little bit about some of the policy-level solutions. We’ve been focused on really creating new models of housing in Maine for older people to address the very issue of a community that is no longer working for people over the age of eighty. We asked, well, what can we do? How can we help older people find housing, help older people find transportation? So with our focus on housing, we’ve actually just in the last few months—few weeks, actually, signed a contract with a new organization who’s going to start doing a home-sharing pilot project here in Maine, to get that up and running.  We’ve also been doing a considerable amount of work over the last many years on zoning, specifically related to accessory dwelling units. We’ve had a big win recently on that. And so it’s no longer just town to town whether you could—you can put an accessory dwelling unit or a second home on your property, but now really municipalities have to allow for that accessory dwelling unit. Which is a really terrific thing. We’re looking to implement transportation solutions that really knit together technology that we already have, and we already use, and volunteer driver—volunteer driver programs as well as public transit systems. Trying to make sure that they’re more accessible for everybody and also better funded. We’re also focused, and have been for a decade, on growing the direct-care workforce to meet the increasing support needs of older people. And have had some real success. If you’re—if you’re a direct-care worker in Maine and you’re living alone, you can actually earn a livable wage, which is really terrific. But, you know, not if you’ve got kids or a husband. So we’re still working on cracking that nut. But our big focus has really been on older people themselves and reducing poverty. Our biggest win just came in the last legislative session last year, when we used a lot of the data that’s in this presentation to secure economic justice for older people who’ve experienced a lifetime of economic injustice and disparities, by significantly increasing eligibility for the Medicare Savings Program. It’s a program that puts about $7,500 in the pockets of older people. So this ultimately means that about—well, about thirty thousand people in Maine, older people in Maine, will have more income. And they’ll be more on par with a livable income and will be better able to meet their basic needs.  And this is something any state in the country can do. The Medicare Savings Program is a terrific program. And for those of you who’ve done Medicaid expansion, Medicare eligibility expansion is essentially the corollary. It’s the part that lifts older people in your communities out of poverty. And D.C. actually increased theirs to 300 percent of the federal poverty level. We didn’t go that far. We’re up to 250. So pretty exciting stuff. And but totally doable, to really make a huge difference in the financial security of older people. So next slide. Just a couple more pieces, and then I’ll be done. We’ve also been using this data—and I loved Jennifer’s talking about traps. And I think, you know, we talk about this idea that we’re still sort of stuck in that 1950s thinking about older people, and what they should be doing, right? They should be leaving work. They should be retiring. The reality is, they’re supposed to be dying at seventy, and they’re not. They’re living to a hundred. And, but we really haven’t gotten rid of the views that older people aren’t good workers, that they cost too much money, that they’re not good at technology. And so what we see a lot of is ageism, both at an institutional and a systemic level. And so we’ve been using this data to talk about, you know, these outdated views that older people and aging—that they’re a problem.  And really, this image is what I like to—like, when I think about, you know, for the better part of the last thirty years, we’ve been talking about this, right? A silver tsunami. It’s literally a gray wave of sedentary, medically needy, older people that’s going to crash down on your head and ruin everything. I mean, that’s what we’ve been talking about. And it makes you feel all warm and fuzzy about older people, right? I mean, they’re a problem to be solved. They’re not a solution. So next slide, please. Really, the primary work that we’ve been doing lately is flipping the script, really changing the way we look at this wave. Literally turning the wave upside down, and looking at it as an opportunity. The key here—and I love—I love this point. We’re so focused on in-migration. And we haven’t—we’ve just started to move the needle in increasing the number of people over the age of sixty-five who are working. I mean, we’ve been working on that for a decade. So we’re glad that there’s movement, finally. But the focus has been on getting people to move to Maine.  And so getting this number, this is—you know, there are 200 million more people sixty and over than there are migrants in the world. I mean, that’s a really interesting number. And I’m going to be thinking about how to use that because, you know, we’ve really been looking elsewhere for the solution, when the solution, as we’ve been saying, is sort of right under our nose, that if we are seeing that older people—that people—all people are living longer, healthier lives, and can continue to work long into their seventies, and eighties, even in their nineties, then our solution is right there. But we’ve not yet been able to do that. So we really do need to flip the script and see older people not just as our workers, but also as our volunteers, as our cultural and municipal leaders, stewards of our environment, right? Caregivers for young and old, basically integral parts of our community that we just can’t let go and we need to actually embrace. And then the final slide is a new map. It’s called the new map of life, that’s come out of the University of Stanford. We look at this and it’s basically saying, look, kids are going to—kids born today are going to live to a hundred, by and large. And we have to think differently about our systems. We need to learn differently, right? Space out the way we learn, space out the way we work, and also need to build longevity-ready communities, right? Communities that have these new models of housing, transportation solutions that work for people who can’t drive. Again, not being able to drive didn’t used to be a problem, because people died when they were seventy. Now people stop driving in their eighties and nineties, for many physical reasons. Also just don’t feel comfortable about it. But we just haven’t—we haven’t invested in the solutions that help people move around when they can no longer drive. So we have to do this through this lens of equity. Age equity is what we have been talking about. And need to be intentional about who’s in our communities, who’s being included, who’s being excluded, partner with people in their eighties, nineties, and hundreds to talk about how we design solutions that work for them. We really haven’t been doing this, but it’s really what’s next in relation to, you know, sort of, again, how do we take advantage of what we have and also build what we need to build for the future? So I’ll stop talking there and say thanks for the opportunity. FASKIANOS: Thank you very much. Again, another fantastic presentation. And so we’re going to go to all of you now for your questions and to share what’s happening in your community. As a reminder, we are on the record. So I’m going to take the first written question from Justin Bielinski, who is director of communications in the office of Wisconsin Senator Chris Larson. Do you have any successes from Maine to share regarding increasing density, affordable housing in urban or suburban areas? MAURER: Sorry. We do have some successes. And we passed a really comprehensive—we actually had a committee that worked for a year on recommendations regarding these things and have passed a comprehensive bill in this regard. And I will say, it’s still early days to be talking. So I think the bill—the law itself is a success. But there have been real challenges to implementation. And I’m happy to share a link to that law in the chat. FASKIANOS: Great. And we can also share that out. Next raised hand from Councilmember Jose Trinidad Castaneda. Q: Hi. Good morning. Or, sorry, good afternoon.  So I’ve worked on some of the California ADU legislation. And I’m working on an innovative program for our city, in the city of Buena Park, California. One of the challenges that I have is how do we allocate our Medicare-managed plan funding for ADUs, specifically for categories of our population that are most vulnerable to demographic shifts—employment and economic trends that you were bringing up in both of your presentations? And since we have a silver tsunami right here at home, how do we—how do we balance that, as local policymakers, between what we need in terms of migration, a baby boom, and, like, a long-term kind of stabilization of a very—you know, a massive aging population in our city? So how do we allocate those funds? And how do we balance between those challenges? Thank you. MAURER: And, Jennifer, I don’t know if you—if you have any interest in jumping in. I’m happy to, I just want to— SCIUBBA: I’m listening to this part. Yeah. I’m learning. MAURER: I mean—I’m not going to say that we have it sorted out in Maine, by any stretch of the imagination. And I think the answer is, it’s going to take a lot of different solutions. There’s not one solution that’s going to work, A. And, again, you’re in a very different place than we are, because we’re so rural and we’re so spread out. But one of the things we’ve been talking about, A, is that we don’t ask people what they want. And the things we know that are true is that it’s better for older people to stay in their community. And because we have decided that we have to build—from an economic standpoint, we have to build affordable housing in a certain way or housing with services in a certain way—build and fund in a certain way, we just do. And so that separates people from their community if they, you know, don’t have an affordable housing option in their community. And so, you know, what we’ve been talking about are that we—you know, we really have to build what’s next. We haven’t—we haven’t designed or built that thing, although it’s starting to work. So we—you know, we’ve got a couple of—like, a pocket community in Dover, New Hampshire of, you know, forty small homes, tiny homes. They’re workforce housing, but I think that’s exactly the kind of thing that older people want. And the question is, how do we incentivize the development of the things that people want? I’m not sure I’m answering your question directly, but it’s going to take a mix of doing affordable housing differently. We need some changes within the federal government around Medicare and pairing of—well Medicare, and Medicaid, and also paying for services within housing. And we need to have affordable housing investing in accessory dwelling units and figuring out how to build affordability into them. So I think there’s a lot of solutions. There are a lot of problems that we haven’t found solutions to, but we’re working on them. SCIUBBA: I want to add in a little on that too, because I think what is great about a demographic lens is it lets you see the future in the ways that no other trend does. I mean, there is no other trend where we can be so certain about what the world will look like in twenty years. You know, the people of—the retirees of tomorrow are already born, or they’re sitting in kindergarten desks today. And so we can do this long-term planning. And I’ve even—there’s an architect who looks at age-friendly architecture out of New York City, who’s German, Matthias Hollwich. And he and his firm build modular homes. Imagine being in New York City or in a densely populated area, and when a building is being turned into housing units it’s done so modularly so that it can adjust for: Do you work from home? Do you have two small children? Did your children move out? Do you now have an aging parent move in? And some of this is done in the context of being environmentally sustainable as well.  So, you know, if we build for that, as Jess said, that can look all kinds of different ways depending on the community. In New York, it looks one way. You’re not going to do that kind of thing, you know, in my suburb of Memphis, Tennessee. But there are many options. And I think also, when we start to do an international comparative context, we can learn a lot there as well. Like, we can learn from other states but, like I said, the U.S. has seen itself as demographically exceptional for so long that in many ways we’re way behind. You know, I remember doing some fieldwork in Singapore in 2009. And they were working on complete streets there for older people to get on the buses, and how did they make that age-friendly? And that was, you know, fifteen years ago. So I think there are some places that have aged faster or have been aware of their aging faster that might serve us as models. Yeah. FASKIANOS: Fantastic. Texas Senator Donna Campbell has raised her hand. Q: Hello. Good afternoon. Can you hear me? FASKIANOS: Yes. Q: Yes. My name is Jim Morales. I work policy for Senator Donna Campbell here in Texas.  Thank you, Jennifer, for that presentation earlier. It was very enlightening. And also Jess, as far as the state of Maine. We are taking some good notes here. As you presented earlier, the growing population here in Texas from basically all over the country and other parts of the world. And we are currently working on legislation for the next session that addresses the workforce, especially, like it was mentioned earlier from Jess, as far as the age population—working population. The infrastructure, medical facilities and centers, nursing homes as well for that—in preparation of that longevity. My question is, if you can share, if you have that information, does Maine have any—have data or best practices on nursing homes, preparation for public health emergencies, and natural disasters? Of course, our natural disasters are going to be different from state—from state to state, but there’s some commonalities there, especially when addressing and sustaining our aging population. Thank you. MAURER: Yeah, and I wish—I wish I knew. You know, I don’t do direct advocacy, nor support—I mean, we’re partners with all of the aging services in Maine. But I can certainly find out for you. I know of a lot of our policies, but I don’t know of a specific—or a specific report that would answer that question. But I will find out and be happy to share it with you if I—if I find it. FASKIANOS: Great. One question, how does women’s access to reproductive care influence the population trends that you’ve cited, both globally and domestically? I think, Jennifer, maybe you can start. SCIUBBA: Yeah, sure. I’d be glad to take that. It makes a difference if you have a desired number of children, and you’re able to act on those desires. Certainly, that is why we have seen global fertility fall from, you know, seven children per woman on average to lower. But by the time you get to a wealthy country and how far it is along the demographic transition to lower fertility and mortality, we’re really talking about a lower number of pregnancies generally. So that would be women’s ability to control whether or not they get pregnant. And women have been getting pregnant less, particularly teen women. So in the United States, what a lot of people don’t realize is that that drop to below replacement fertility has really been in large part at the teen level. And so we see fewer teen pregnancies. That is not just from contraception and reproductive health. It’s also from the fact that they are less sexually active than previous generations were. So, you know, it’s always good to look behind those numbers and really see things like, you know, we see increasing pregnancies in my age group, in the forty-plus age group, is actually up. And so it does differ for those different age groups, yes. But having the ability to control who gets pregnant, when, and where does make a difference, of course, as to how many children are born. FASKIANOS: Great. I’m going to Patricia Farrar-Rivas. How are you addressing the high costs of care for individuals with dementia and Alzheimer’s? I think, Jess, you marked that you could answer that. MAURER: Well—I’m not sure that we’re addressing the high cost, but we are trying very specifically to, A, support informal family caregivers. We’ve increased the respite care benefit and have created a respite care program specifically for people with Alzheimer’s and dementia. Are doing a better job of trying to do care coordination. So that is one of the bigger cost drivers in the federal government, or CMS, or—you know, sort of uncoordinated care for people with dementia. We also have just completed the revision of our state plan on Alzheimer’s disease and related dementias, and have a BOLD—the second iteration of the BOLD grant, and are working collaboratively—starting implementation of many of the recommendations of that. And, again, a lot of that talks about coordination of care early, early diagnosis, early connection to services, and then additional training for all kinds of providers. Which I think is really critically important from EMS and Fire and Rescue to local municipal officials needing to understand, you know, sort of how do we—how do we intervene with people who are in our communities, particularly, as I mentioned, right, I mean, women are more likely to live alone than men. And this is a trend not just in Maine, but nationally. And so—and also, we didn’t talk about this, but I think, Jennifer, you bear this out, the generation before—Boomers had 10 percent fewer babies than the generation before it. And so you have a lot of older people who don’t have kids. And so you’ve got a lot of older people with dementia, with moderate dementia, living in the community, and really no supports. And so we’re really talking about, you know, looking at dementia-friendly communities, and how do we integrate some of the good work that’s been done nationally at a local municipal level to put supports in place, both for people living with dementia and with family caregivers. So happy to provide some more support. I’m not sure that we’re—I’m not sure we can say we’re addressing—we’re addressing the cost drivers at a very local level. I’m not sure we can say we’re being successful at the CMS level. FASKIANOS: Thank you. I’m going to go next to Tom Flight, board member in East Hampton Village in New York, with a raised hand. Q: Hi. Good afternoon. And thank you both very much. A fairly straightforward question, which is: What have you found to be the most effective means of educating the public on the changing profile of the population and the services required? SCIUBBA: I’ll add some global part of this. I think that we have a long way to go to get people to understand that this shift towards fewer babies is permanent, and not a problem to be solved. So that is, there’s just a long way to go in getting that. But it is a necessary first step then if we are going to implement these policies and programs that Jess talked about in detail, and all of you are concerned about in detail. It seems to me that without getting that first hurdle—getting over that first hurdle, we don’t plan for the long run.  So that’s why I do always start by putting it in global context. This is not some fluke. This is not an exception. This is a permanent shift, the likes of which we’ve never seen before. But we worked so hard to get there. We worked so hard to get infants and children to live to reproductive ages. We’ve worked so hard to create economic opportunities outside the home, and to educate people and, you know, to thrive. The result of that was having fewer children on average. And so I think we’ve got to—that is a first hurdle, and then understanding how to be resilient and adapt to this is the next step, which I’ll hand over to Jess.  MAURER: Sure. And, you know, I mean, I know this is going to sound ridiculous, but I’m going to say the answer is really just conversation. And we’re hosting those conversations at multiple levels. So we actually have created a thing called the Leadership Exchange on Ageism, which is a fourteen-hour, very intensive peer learning, leadership learning experience. We’ve had 180 leaders graduate through that. And we’re really digging deep on these issues. And what we found, which I don’t—you know, it’s sort of been stunning, actually—is that people—the program itself leads people to take rapid action within their own institutions, systems, and spheres of influence to create some change. It is an aha moment. And so we’ve now taken that. We’re having community conversations. And, again, we are finding them very impactful. People haven’t had a chance to have these conversations. And when you kind of bring cold, hard facts—as Jennifer presented them, and, you know, we talk about them, that people get it and they want to know then, what do we do next? And so, anyway, I will just say, we’re just hosting a series of conversations with employers. Again, helping employers understand why—what are the benefits of a multigenerational—first of all, what’s the business case? And then, what are the benefits of a multigenerational workforce? And if you approach it in that way, and then you give them examples of multigenerational workforces in Maine that are thriving, that are actually attracting workers because of—because they’re multigenerational.  And the ways—that’s the other piece. Is there’s a lens that we talked about, right? When you—when you do things to address challenges—real or perceived, by the way—for older people, older workers, it works for everybody. I’ve heard, you know, it takes longer to train an older worker. And then I say, well, even if that’s true, don’t you think that would benefit younger workers too?  Let’s start there. It’s not true. But even if it were true, wouldn’t it be better for younger workers to have a four-week onboarding process instead of a two-week? And don’t you think they’d probably do better, and feel actually better connected to the organization if you did that? So conversation is the key to this. And I’m going to say it works. I swear it does. So that’s my answer, and I’m sticking to it. FASKIANOS: Great. I’m going to go next to Emily Walker, legislative director in the Office of Pennsylvania Senator Katie Murth. Q: Hi. Thank you guys so much. I’ve learned so much from both of you. I am a Pennsylvania native myself, but I lived in York, Maine, for a long time, and I have family in Dover, Delaware—I’m sorry; Dover, New Hampshire, not Delaware. But, so familiar with the area and the issues that they face. And so it’s very helpful to see the work that you’re doing there. I have a question about kind of tying in sort of the needs of our younger generations into the needs of older generation. You mentioned, you know, more accessibility to affordable housing, more accessible public transportation, and just generally, like, more working—more workplace accommodations as well. Do you think there’s more opportunity that we could be bringing in young—so for being—I’m at the end of the Millennial Generation, and right at the beginning of the Gen Z generation. So I feel like, is there opportunity to kind of build on things that we do need for our aging population, and then the things that our younger generation are also asking for, that they want in their communities? And how can you sort of bridge that together a little better? MAURER: Yeah, I mean, I think that’s work we really have to do. And, yeah, all right, well, I’ll just say it out loud because I feel like, you know, it’s my—it’s my duty to say, you know, I’m not sure generational—like looking at generations are really helpful. Because I think it skews things. What I think is to say, you know, we have older people who need X, Y, and Z. And if you solve that solution—by the way, we have younger people who need X, Y, and Z. As a matter of fact, you know, older people—they’re lonely and isolated. That’s, like, I hear it all the time, like, with pity in your voice. Poor older, lonely people. Well, all of the data suggests that the people who are struggling most with isolation and loneliness are in their twenties and thirties, particularly young people who are going to college right now, because of the pandemic, are really struggling, right? And so, you know, it’s sort of, like, we need to stop talking about age and start talking about what we all want. And what you find, right, is if you look at workers today, right, older workers—oh, they need flexibility, or want flexibility. They want—they don’t want to work forty hours a week. They want to—well, OK, that’s also true for younger workers. I mean, all the trends say it. And so, you know, like, moving to a value-based sort of view, or what do we—what do we—where, where is there common ground, right?  I’ve heard over and over again that people who are described as millennials don’t like to drive, right? They would prefer to be driven. They would prefer to use public transportation. Well, public transportation is what we need. That that wouldn’t be what older people say, but they need—but they need public transportation. That’s what they would say. So for different reasons. So I think it’s like finding commonalities where things work for everybody, regardless of how you come at the problem. We come at the problem through aging, but we always try to solve that problem for everybody. FASKIANOS: There’s a written question from Stuart Murray in the Village of Corrales in New Mexico: It seems this presentation is aimed at higher-density communities. I was raised in a small Oklahoma town where services do not exist. When I talk small, 1,500 people or less. People do lean on other people, churches, et cetera. However, creating these services may not be financially possible. Is this where higher levels of governments need to step in to help these rural communities? MAURER: So I’m sorry if I gave that impression, because, like, all of Maine is rural. We don’t—we have, like—we have, like, nine communities that are not rural. And what we have are—one-hundred-plus communities have started volunteer initiatives called lifelong community initiatives, age-friendly communities, villages, NORCs, whatever you want to call it. We don’t—there’s lots of ones that have no models at all. But these are volunteers within communities that are doing volunteer driver programs, food, lunch programs, home repair initiatives. The key, though—particularly what we found in rural settings—is that you do need some community backbone, some community-based organization backbones. So, for instance, Habitats. And we don’t have Habitats in every community. Well, we also have public housing authorities, but not in every community. So we have some churches—that wanted to—so we look at—from a policy perspective, right, we say we need home repair, right? So the very first—so older people are living in homes that don’t work for them anymore, but we haven’t built the next iteration and we’re not going to build enough affordable housing. So we have to keep people safely in homes. So home modification, and weatherization, and home repair is the—is the first line, right, of keeping people safely at home. So how are you going to get those services affordably? Well, you have to figure out who you have that serves any community. And then we have successfully had Maine Housing then fund those home repair initiatives. Some of them use volunteers. Some of them use public housing authority staff. But it’s about, you know, sort of—we can do this. But it does have to be knitted together through the municipality, through volunteers, and through a community-based organization. We have found, over and over again, different models that work to solve different challenges that people who are living rurally are experiencing. FASKIANOS: Great. I think we have time for one last question. And I’m going to take it from raised hand, Monica Rossman, Glenn County supervisor. Q: Good afternoon. Thank you for letting me ask a question. We live in a very rural county here in California. Population twenty-eight and change. The problem that we’re having right now is getting our seniors to actually take advantage of the services that we are providing, even though it is limited. I keep saying over and over again, in fact I said it during my campaign, you know, a hungry bird only gets fed when it opens its mouth. And if these don’t want to do it, they’re just not going to. And, you know, I’m starting to see all of these programs, which I’m sure, you know, Jess, you could probably agree with me, there are a ton of programs out there. It’s just when they’re not used, they’re forgotten. And, you know, we have a grant for tablets to senior citizens that have been open for two years.  They’re just now, ever since I started—I started peeling an onion, is what I did. When I first got into office, I started taking care of, you know, my senior citizen parents who have Alzheimer’s, dementia, the shared cost, you know, taking care of two households, you know, trying to get two households to run. So my question is, how do we get the—what is the incentive to bring them in? You know, what can we do? That’s the problem that I’m having. And I’m working on it. I feel like I’m going uphill. And I could definitely use some help. So thank you for letting me ask the question. MAURER: Yeah. So, you know, I mean, if I were in a room full of however many people who are here today, I would say how many people like asking for help? And the answer is zero. I mean, like, every once in a while some doctors will raise their hand. I don’t know what that’s all about. But most people really don’t like asking for help. And it’s really true. I mean, like, I mean, I love, you know, it’s a trap, right? Independence is a trap. And what we hear all the time when we ask, when are you old—what’s old and when will you be old, it’s always about what I can’t do for myself. And so there’s a real tension inside of us that says, if I need help, you know, I’m on the—I’m on the downslide here. And so there’s—so one of the things we found that’s really helpful is to ask older people, why is it hard to ask for help and what would help you ask for help? And, specifically, what’s the trusted source? What we heard in my own community when we asked that question is: We don’t want to rely on the same volunteer over and over again. We don’t want to burden our children. We don’t want to, you know, burden our next-door neighbors. But if there was—if we could call the town, or we could call a church, then—and say, I need a ride to the grocery store, that would feel less burdensome for us. So I think it’s about asking the people themselves. And then, I will also say, getting a whole bunch of volunteers, right, together who know about the services to be the bystanders who are there to say: Hey, I know about this great program, when they hear that people are in need of things. And we have found that’s a great way. The final piece, I’ll just say, in my own community, again, we’ve had this—every community has this problem that there are benefits that people don’t want to use. Telling stories in your local paper about people who did use them successfully and how it changed their life is really good. It’s money. It does—it does bring people in. SCIUBBA: Yeah, the two last ones that Jess mentioned, I was thinking come—we have so much research in the public health literature about how to change people’s behavior. And the most effective way being a peer who’s used a service coming into your home and talking about that service. And if we’re talking about family planning, or if we’re talking about old-age services, or, you know, any kind of help in the home, that model just—that community-based model seems to work really, really well. FASKIANOS: Thank you both for this wonderful hour. We really appreciate it, for you taking the time to share your expertise, and for all the great questions and comments. We appreciate you as well. We will send out a link to the webinar recording and transcript, contact information, links to resources. You can follow Jess Mauer at the Maine Council on Aging on X at @mcoaging, and Jennifer Sciubba at @profsciubba. As always, we encourage you to visit CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for the latest developments and analysis on international trends and how they are affecting the United States. And please don’t hesitate to share suggestions for future webinars. You can email us at [email protected]. Again, thanks to Jess, and Jennifer, and to all of you. And we hope you have a good rest of the day. END  

Experts in this Topic

Christopher M. Tuttle
Christopher M. Tuttle

Senior Fellow and Secretary of the Corporation

  • Labor and Employment
    U.S. Strikes and Global Trends in Labor and Productivity
    A. Michael Spence, distinguished visiting fellow at CFR, provides a global perspective on the changing landscape of labor and economic productivity. Sharon Block, professor of practice and executive director of the Center for Labor and a Just Economy at Harvard Law School, discusses this year’s strikes and the economic implications of increased collective labor activity in the United States. A question-and-answer session follows their opening remarks. TRANSCRIPT FASKIANOS: I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR.  We’re delighted to have over two hundred participants from forty-seven states and U.S. territories with us today. CFR is an independent and nonpartisan membership organization, think tank, and publisher focused on U.S. foreign policy. CFR is also the publisher of Foreign Affairs magazine. And, as always, CFR takes institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. So, again, thank you all for joining us today. As a reminder, this webinar is on the record. The video and transcript will be posted on our website after the fact, at CFR.org. And we will circulate it to you as well. We are pleased to have Sharon Block and Michael Spence with us to talk about U.S. Strikes and Global Trends in Labor and Productivity. I will give a few highlights from their bios. Sharon Block is a professor of practice and executive director of the Center for Labor and a Just Economy at Harvard Law School. Recently, she served as a senior official in the Office of Information and Regulatory Affairs in the Biden administration. From 2017 to 2021, Professor Block led the Labor and Work Life Program at Harvard Law School, where she focused on labor law reforms to build a more equitable economy. Prior to that, she’s held various senior positions in government, including principal deputy assistant secretary for policy and senior counselor to the secretary of labor. Michael Spence is a distinguished visiting fellow at the Council on Foreign Relations and clinical professor of economics at Bocconi University in Milan. He is also a senior fellow at Stanford University’s Hoover Institution and the author of the book, The Next Convergence: The Future of Economic Growth in a Multispeed World. And in 2001, Dr. Spence was a co-recipient of the Nobel Prize in Economic Sciences. So thank you both for being with us. Sharon, I thought we could begin with you to give us a sense—give an overview of the increased collective labor activity in the U.S. that we’ve seen this year. If you could discuss the different strikes and the common threads, AI among them.  BLOCK: Yeah, happy to. And thank you for having me. It is—I’m sure it will be a really interesting conversation. So just set the stage, this summer into fall, I think, was a season like no other in recent years in the U.S. labor movement. There were approximately half a million workers who went out on strike in 2023. And a lot of that activity, again, was concentrated in the later part of the year. Another way of thinking about that is more than four million workdays were spent on strike instead of working. And to put it in context, that’s double the number of workers who went out on strike in the U.S. in 2022. So really a big upswing. But, to sort of pull back and put it in even sort of longer historical context, it’s a much, much lower number than what we saw decades ago in the sort of the high point of union density in the United States. You had millions and millions of workers out on strike, and a much greater part—share of the economy would be affected by those strikes. But in terms of, like, say, the last twenty to thirty years, this was a very significant year.  The biggest strike in the United States this year was the SAG-AFTRA strike. That’s 150,000 union members were on strike. That’s a little bit of a funny number because SAG-AFTRA members are obviously a little unusual. They don’t go to work—typically they don’t go to work every day. But they are a very big group that withheld their labor, along with the Writers Guild. So you had Hollywood shut down for a significant period of time. The next biggest strike this year was the strike at Kaiser Health Care. Those are mostly SEIU members. That was about 75,000 workers who were out for three days. And then the strike that got certainly the most attention and was, I think, the third-biggest strike this year, was the United Auto Workers and their sort of novel strike strategy vis-à-vis the big three auto companies. Now, they did not take all of their members out at one time. So that was about 50,000 workers. There are more members in the UAW than that. But it was still a very significant number of workers, even with this sort of staggered strategy.  So in addition to those three very large strikes we also saw strikes in the hospitality sector, in Las Vegas at the casinos, also L.A. hotels, and then in higher education. So the most of these strikes were really centered in the private sector. But we did have University of California, graduate student workers went out on strike. That was a very large strike. And then Rutgers University faculty and staff went out on strike. Now I would add to this an almost-strike, if you really want to think about how dramatic this activity was in the United States. The UPS workers—the Teamsters at UPS didn’t actually go out on strike, but took a strike vote, came very—like, within hours of going out on strike, at which time they were able to reach an agreement with the company. But it’s a similar dynamic of the threat of a strike that led to that agreement. But say the theme among many of these strikes was that they existed—they happened between bargaining partners who have a very mature collective bargaining relationship. You think about the auto workers who have been unionized at the same three companies—you know, one of the companies has changed their name—but essentially organized at those three companies for almost a hundred years. These are not the kinds of bargaining relationships that have dominated sort of labor news over the past year or two, like Starbucks and Amazon, where you have new collective bargaining relationships. We didn’t see strikes among those workers. We saw them in these very established relationships. The other theme among these strikes, really almost universally, were very, very big wins for workers. They settled these strikes with agreements that, I think, were objectively viewed as very advantageous for workers. You saw very high levels of public support for the workers in almost all of these strikes.  And then, to your point about AI, these are also strikes that happened, for the most part, in sectors that are in big transition. In some, because of the introduction of AI. That was obviously a very big theme, a big factor in the Hollywood strikes, but also other transitions. In the autoworkers strike you had the issue related to transition to an EV future played a big role, in healthcare that’s obviously an evolving field. So this idea of there being a big transition and workers using their power through their strike in order to get contracts that help them have more of a say in the future. And then I would say one last theme that was very prevalent in many of the strikes was the sort of rhetorical and motivating theme of workers wanting to have their fair share. You heard that phrase come up a lot. So we’re talking about sectors where the companies had had a recent history of very high profits, workers who were locked into collective bargaining agreements that they had negotiated sort of before the pandemic. So if you think about, like, UPS had very, very high profits during the pandemic. The Teamsters were working under a contract that didn’t anticipate that level of profits. You have—the auto companies were also coming off a couple of years of very high profits. And so you have this theme of workers really wanting to get their fair share of this increased revenue and profits that they saw coming into their—into their companies. The last thing I will say is just if you want to understand just sort of how positive this strike season was for workers, you just have to look at the UAW contracts. I mean, there are so many things about this strike that were just groundbreaking, or at least groundbreaking as of the past few decades. You saw wage increases of 25 percent for permanent workers and 150 percent for some of the temporary workers. You had really novel provisions in the collective bargaining agreement that they eventually signed to keep open or reopen auto plants. We’ve never really seen that before in a collective bargaining agreement. And workers preserving the right to strike over any other plant closures. As I said, you got this foothold in the EV future in agreements for the companies to recognize the union in these EV battery plants. And so, it was just a really remarkably positive contract that ended the strike in the auto sector, really transforming the UAW to be able to say, again, that a job in the auto sector equals a good middle-class job. And we’re seeing now the autoworkers taking that message to the nonunionized companies—Tesla and the transplant companies—to say, look what we got for workers at the big three. Wouldn’t you like to have this too? And you’re seeing actually these companies already responding by raising wages. So it’s also a strike that has had pretty significant ripple effects already. One thing to watch in 2024 is how far those ripple effects go, how successful they are. Will this season of successful strikes for workers actually lead other workers to want to organize a union in their own companies, in their own sectors, maybe even beyond the auto sector? And, again, we did have some groundbreaking provisions that came out of these strikes around AI. The Writers Guild, most significantly. You had agreements that AI can’t be used to undermine the writer’s credit, requirements for studios to disclose if they’re giving any material to writers that was generated by AI. But then also, in a sort of more positive embrace of AI, the right for writers to choose to use AI as a tool as part of an agreement with the studios. SAG-AFTRA, the actors also got provisions sort of protecting their images from AI replication without their consent. And the Las Vegas—the hospitality unions also got provisions guaranteeing them advanced warning of any new technology rollouts that were going to impact jobs and training for jobs that are altered by AI. And, really importantly, protections from certain types of AI that enables surveillance within the workplace, something that was very important to hotel workers who have been increasingly surveilled in their work. So there is a lot to dig into. I’m going to stop talking so we can get to some questions, because there’s really—could go on and on because it was such a fascinating period of time. FASKIANOS: Fantastic. Thank you so much, Sharon.  Michael, let’s go to you to pull out a little bit and talk about the global trends you’re seeing, and the implications for the future workforce and labor movements. And you just recently authored an article in our magazine, Foreign Affairs, The Coming AI Economic Revolution, with James Manyika. So perhaps you could talk a little bit too about the AI piece of this as well. SPENCE: Well, thank you very much. And I’m, you know, like Sharon, very pleased to be with you. So let me approach these things, you know, at a sort of slightly different level. That three-decade period that Sharon referred to is a period in which a massive amount of productive capacity was introduced into the global economy, largely as a result of emerging economy growth. And that had one very large negative effect, which was it, you know, created options for, you know, labor arbitrage and decreased the power of American labor. So unions declined, you know, the middle class got hollowed out to some extent, and so on. That force is fading. It’s not over, but it’s fading. There’s lots of evidence of that. You know, for at least two decades, probably more than that, we lost employment in the manufacturing sector. That stopped in the last decade. And then—but then there’s some other trends that, you know, kind of reinforce this. So when I look, you know, I see aging populations. Seventy-five percent of the global GDP is produced in in countries that are aging rapidly. You know, the great financial crisis caused some of our older fellow citizens, like me—not to retire. Now they’re retiring in droves. You know, when I look at the American economy all—most of the big labor, you know, employment sectors have labor shortages, right? I mean, it’s clear that on the underlying economic fundamentals, labor’s power position vis-à-vis their employers has increased dramatically. Some of this shows up in unionization. Some of it just shows up and in bidding for, you know, talent in a way that basically companies didn’t have to before—or, employers in general. So I think this is basically a good development. I expect to see, you know, several attractive trends. A reversal, maybe not a dramatic one, in the trends in inequality on the income side, which would be very good thing because it had gotten pretty extreme over this three-decade period. You know, I think we will see productivity increases because when you’re short of labor it’s sort of natural to start looking—the incentives are much stronger to look for productivity-enhancing things. And if that’s done in a way that makes—you know, puts management and labor in a collaborative position, seeking for ways that are mutually beneficial to do it, that’s also a good thing. On the negative side, you know, this is—you know, for the first time, really, we live in a supply-constrained world. I just—you know, at the risk of telling people what they already know, after the great financial crisis we’ve had—and for a longer period than that—we’ve had essentially no sign of inflation whatsoever. And we had no sign of inflation, in spite of zero interest rates and massive infusions of liquidity into the economy to try to precipitate a recovery after the balance sheet damage that the great financial crisis caused. And as a result of that, people have kind of gotten used to the notion that, you know, the cost of capital isn’t very high. So for people who are operating in state and municipal governments, I think, you know, there’s—nobody knows for sure. And we have a big inflation fight on, led by the central banks. Not just in the United States but in the U.K., and in Europe, and in other places. China being a fairly dramatic exception to this. We’re likely, in my view, to emerge from this with higher real interest rates. I don’t have any doubt that the central banks will get the inflation eventually under control, because they’re determined to do it and their credibility depends on it. That’s their job. But when we come out, I think we’re going to have, you know, lower sustainable debt levels, higher cost of capital, lower multiples, lower valuations for many assets. This will have mixed effects. You know, the cost of funding, certain longer-term investments is going to be a little bit higher than it was before, maybe even more than a little bit higher. On the other hand, from a distributional point of view, you know, when—in the period—the decade after the great financial crisis, the one thing that just ballooned in value was the assets. And that favored people who, you know, own a lot of assets. So it didn’t do wonders for the distributional features. So I think on the whole, if you sort of look at—I mean, there’s a lot—a lot of other factors, you know, that are affecting this. The global supply chains are, you know, collapsing—or, being fragmented. We have a major strategic competition, you know, with China underway. Economic policy, from an international point of view, has tipped toward, you know, various kinds of security—national security prominently, but also economic security, here in Europe energy security, food security, and so on. And this is causing, you know, policy to reinforce a trend in the global economy that’s very visible now, which is diversification in pursuit of resilience.  And the policy is reinforcing it and saying: We have to do some of this at home in a way that we didn’t pay attention to before. We lived for three decades, those three decades, in which the way global—the global economy was constructed was basically on the basis of economic efficiency and comparative advantage. And that’s no longer true. So we have homeshoring, friendshoring, nearshoring, et cetera. All of which are transforming the structure of the global economy. And for the most part, I think, in ways that favor, you know, domestic—our domestic fellow citizens, and especially labor. Briefly on AI. So, we’ve had a sequence of breakthroughs in AI that go back, you know, a decade or a bit more. Language recognition. You know, image recognition was a stunning set of breakthroughs that, you know, occurred roughly around 2015-2016. But the one that’s really gotten people’s attention is generative AI, the large language models and the like. So there’s several things to say about this. And I’ll try to be brief. One, we’re not at the end of this. These folks aren’t finished. So what’s coming next we don’t know. I suspect that we will see significant advances in robotics as a result of the fact that gen AI allows you to basically talk to machines in a way that they understand.  The gen AI is distinctive in the sense—in two respects that I think are important. One, unlike any other previous version of AI, they switch domains easily. By that, I mean, you know, you can talk to it about the Italian Renaissance and then switch to math and then it’ll do computer coding, you know, and whatever, right? Now, there’s lots of quirks, you know. These systems so far have hallucinations. They make stuff up. And I mention that for a reason. You know, it’s not—when you look at it carefully, it’s not sensible to think that these things should be fully, you know, allowed to operate on their own, right? They’re just not that flawless. You know, there’s a famous story in America, you know, a lawyer, slightly incautiously, prepared a legal brief entirely using ChatGPT, and handed it in. Well, ChatGPT made up all the legal precedents. And this gentleman is, I think, in some serious trouble as a result with the courts.  So the way I think about it, and I’m not alone in this. I mean, James and I wrote that paper. We think that the right model is powerful digital assistant or machine-human collaboration, right? And you have to work that out. But let me say, you know, right at the top, there’s just overwhelming evidence that whenever you mention, you know, AI, people think, automation. They think they’re coming for our jobs. A hospital administrator stands up and starts talking about AI—and, by the way, AI is going to be transformative in biomedical and life sciences, which is not our topic for today. But it’s just one of the many places where the footprint over time will be felt. We have to overcome this bias. So the implementation matters.  You know, unions representing people and having a voice in which they participate in conversations about what the AI is supposed to be doing and how it will change the jobs, and which parts are acceptable or not. But I think in the course of it we can sort of get rid of this—what I call the automation bias. Erik Brynjolfsson at Stanford calls this the Turing trap. Alan Turing proposed that we evaluate our progress in AI by asking the question: Can we produce a machine that when a human being interacts with that machine, not looking at it but talking with it, it thinks it’s interacting with another human being? And so we haven’t got there yet, but we’re working on it. Second, one small step. Almost all AIs are benchmarked against human performance. So when they declare victory in image recognition, it’s when it passes the average human, and so on. It’s the next small step that’s dangerous, which is, you know, well, once the machine passes the human, why don’t we replace the human, right? That’s where the AI—the automation bias comes from. And it’s just a mistake. Now, there may be a time in the future when these machines are so good that automation is a more serious consideration. But right now, they’re powerful digital assistants. They can sometimes do things that humans can’t do. Sometimes they do them, you know, in a way that’s just on par. But they—but I think the promise here is if we do this right that we’ll have the potential—not next year, not the year after, but maybe by the end of the decade—we’ll start to see, you know, impacts of this and in terms of productivity that are actually, you know, enhancements to the way people work and how they view their employment. To get there, we got to get rid of the automation bias, which is very deep. And we need one other thing. We need access. So right now, we’re in a period of intense exploration and experimentation. Who’s doing this, right? The answer is the companies with the resources to do it, you know. But if we’re going to have this broadly beneficial in society, available to small businesses, to local governments, and so on, it has to diffuse widely and well beyond, you know, the kind of entities that have the capacity to invest tens of millions of dollars in it. There’s a role for government in this.  And I want to conclude with this, because we’re talking to, you know, important government officials in our economy. There really is a role, you know, in ensuring diffusion and broad-based access to these tools once we’ve decided, you know, in rough and ready terms, you know, how we’re going to try to use them. It’s really important, both for the purpose of getting the productivity surge but also, you know, for preventing—you know, in past—there’s studies of this at the McKinsey Global Institute. In past, you know, episodes of digital, you know, transformation, they’ve studied adoption. So and what you see is a pattern of divergence. So the tech sectors way is way up top, and finance is not far behind, and then you drop down and find sectors that, you know, are lagging seriously in this respect. This is the pattern that we do not want to repeat on this round.  So I think there’s huge potential. There’s some downside risks. James and I would say that, you know, it’s important to pay attention to the misuse of these things and the downside risks, just as there is with any powerful technology. I mean, gene editing is terrifying if used in the wrong way, just as AI is as well. But there’s the positive agenda as well. FASKIANOS: Thank you both very much. And now we’re going to go to all of you for your questions. We’ve got the first written question from Riley Nye: Hasn’t automation already replaced tons of manufacturing jobs? SPENCE: Sharon, do you want to take that, or? BLOCK: I mean, certainly there has been displacement. Earlier this year I visited a Ford auto plant. And it is very, very—a very, very different place than certainly historical documentation of what the manufacturing process looked like. There are a lot fewer workers. You see that also reflected in—just to stay with the auto sector—in the number of UAW members in that sector. The UAW has actually diversified their membership a great deal. They do a lot—as many people on the call may know if you’re involved with higher education—they represent now many, many graduate students and other employees of higher education institutions. So, yes, that has happened. But the displacement conversation is obviously not over. And there is, I think, concern about additional displacement of workers if robotics and those kinds of productivity enhancements, or whatever the right euphemism is, continue. But I do think in the shorter term, the bigger concern actually should be for workers is the way that automation is being used in workplaces to enhance not just productivity but also employer domination of workers. These surveillance issues you’re seeing, especially if you follow, like, the logistics sector. The intensification of work that is enabled by the kind of productivity tracking that AI has enabled. I think these are the changes in the workplace that people are feeling already, even before we get to this question of whether AI is ever going to—or when it’s going to be good enough to replace more workers. And so that’s a place where I think the regulatory attention really needs to be paid. And if you look at what the EU just did—we don’t know the details yet of the AI Act that the EU Parliament just passed—but there is a lot of attention to those issues. And, in fact, the workplace is designated in that legislation is a high-risk forum for the introduction of AI, not because of the displacement issues but because of the intrusion into sort of personal privacy spheres for working people, and this potential for new safety and health issues to arise from a misuse of AI in the workplace. FASKIANOS: Thank you. I’m going to go next to Justin Freeman, who is the director of community affairs for New York State Assembly: Could you share more about how today’s strike actions compare to before, say, thirty, forty years ago? You mentioned four million strike days. BLOCK: Yeah. So, again, we haven’t had a year with four million strike—it’s actually more than four million at this point. That doesn’t capture the full range of the UAW strike days. But I just couldn’t find a more recent calculation. That’s a little bit of a hard calculation to do. We haven’t seen a four million strike day year in a long time. So, say, ten to fifteen years ago. But if you look at, like, in the 1930s, so the period as we were legislating the right to join unions, you would have—there were years in the 1930s, early 1940s, where you had thousands of strikes in the United States.  And, you know, it’s hard to compare numbers because our economy is obviously so much bigger now. Our workforce is so much bigger. But if you could imagine thousands of strikes. It was really a completely different scale. I mean, if I could show you a graph from, like, the ’40s to today, you would see a line that just really dramatically falls off as we entered this period, you know, that we’ve been talking about, like the past thirty years of a real decrease in the strength of the labor movement. You saw a commensurate decrease in the number of strikes. FASKIANOS: OK, thank you. Shawn has asked a question. China was mentioned. How big of a threat do you feel China is, with their housing, population, and debt crisis? SPENCE: OK. So I think everybody knows that China, you know, has had kind of a pretty impressive forty-year run. It was one of the poorest countries in the world in 1980. It has exhibited growth rates of, you know, 7, 8, 9 percent on a sustained basis that, you know, causes, you know, the size of the economy and incomes to double faster than every decade. That’s not something an advanced country can do. I think China is now in a very difficult sort of position in terms of transformation. And the economy is in trouble.  So they have major, major excess capacity in real estate, and a lot of non-performing loans, and whatnot. This directly affects the Chinese economy because while this is, to some extent, true in other places, the household balance sheet—meaning wealth—is heavily dependent on real estate, right? Once they started buying houses and so on, they just owned more real estate and less kind of other kinds of assets than almost anywhere else in the world. And so when the real estate values decline, or there’s some uncertainty, or it gets shaky, or, you know, the apartment that you bought in advance doesn’t get built, it causes a major shakeup in confidence.  The fiscal system needs major reform in China. The municipal governments are essentially flat-broke. They do not have the normal sources of revenue that our municipal governments do. And they are responsible for delivering services that are in excess of their capacity to finance it. There’s no more land. They used to do it by selling land. There’s no more land to sell, or not enough to finance themselves. But I think the really sort of serious challenge, in addition, in China is that the pattern of off again/on again and fairly aggressive regulation, which you can see in the tech sector but it’s broader than that, has caused a loss of confidence among investors.  And by that, I don’t mean foreign investors. I mean, everybody, including the domestic investors. And so with the household spending, you know, a little bit on hold, and the private sector investment, you know, kind of on hold because they’re not sure what their place in the sun is, that, you know, there’s a significant slowdown. The numbers in China will look OK because the previous year was a disaster. So when you’d show up growth numbers, you know, when they were in zero-COVID, it was, you know, unimpressive. So the numbers look better than the actual situation. Having said that, you know, it is in many ways—you know, in human capital, in science and technology, and whatnot—they’ve made huge investments in it. So I don’t want to leave the impression that this is a kind of, you know, permanent disaster at all. They can pull this out. And it’s an economy—it’s a very large economy, the second-largest one in the world. And it will be, if they right the ship on these—what I think of as short- and medium-run challenges—it’s a, depending on how you think of it, a powerhouse and potential major competitor. FASKIANOS: And, Michael, just to follow up on that, a question from Alan Schneider, who is legislative director in the Office of Maryland Delegate Chao Wu: You know, given the relationship changes between the U.S. and China, how are the changes affecting wage, A1, and inflation here in the United States? SPENCE: Very good question. So in terms of, you know, the—we are in—our national security, you know, driven policies are bringing more stuff home. And in addition, China is now an economy with a per capita income of $13,000. You’re not going to make, you know, the cheapest labor-intensive, process-oriented manufacturing and assembly stuff in China for very much longer. There is no real substitute for China. There are other countries. And some of them are benefiting—Vietnam, Bangladesh, you know, Mexico has a major opportunity as China sort of, A, gets into kind of conflict with us and, B, you know, we move both businesses and governments in behind with policy to move stuff away. I think on the whole it’s slightly inflationary. But it’s good for, you know, labor—meaning, our labor. FASKIANOS: Terrific. Let’s go to—sorry. Going to sell in Selin Zorer: What proactive steps should federal and state legislators take to ensure that the emergence of AI benefits the public? SPENCE: Sharon, do you want—do you want— BLOCK: I can—I can start. I mean, you know, I think one way to ensure that it benefits public—I mean, most of the public has to go to work every day. And so thinking about the ways to protect workers from some of these abuses and excesses is really important. The other—I think the other area where I’m really interested is while we see some paralysis at the federal level in terms of legislating around the introduction of AI into the workplace, I think there is much more of an opportunity for state and local governments to step in. California is obviously very engaged in their legislature in thinking about guardrails for AI in the workplace and in other domains.  But it’s really important that as this regulatory forum moves to state and local levels, that there is an attention to making sure that the people who are going to be most affected, that working people have an opportunity to have a voice in how this regulation develops. And so whether that’s bringing in the labor movement, finding other ways to ensure that working people are participating in these really important conversations, I think is going to be critical. And I hope we’ll see sort of interesting and innovative approaches as more states feel compelled to get into the game. Because we are probably not going to see, you know, significant federal regulation or legislation in this space. FASKIANOS: Thank you. Next— SPENCE: Irina, could I— FASKIANOS: Go ahead, Michael, absolutely. SPENCE: This is—I don’t want to repeat myself but, you know, there’s a positive agenda. You know, a lot of the, you know, management that affects people’s lives is done at the state and local level. Not, you know, the kind of stratosphere where some parts of the federal government operate. And, you know, I think, you know, thinking carefully about where we’re going with these technologies and how you help people, you know, become comfortable with them, productive with them, and so on, is a hugely important part of the agenda. And I can’t think of more important entities than the state and local governments, you know, the community colleges. You know, the education system as a whole seems to me to be, you know, where the conversation needs—you know, a fair amount of the conversation needs to occur. So, again, I don’t want to, you know, minimize the importance of preventing downside risks and misuse and so on. But I think walking into the world, you know, without a coherent set of programs to help people—you know, if we are going to have these transformations in one form or another. That it’s way too powerful, these technologies. So I think the challenge is to do it right, rather than resist them. FASKIANOS: Fantastic. I’m going to go next to Justin Freeman, director of community affairs at the New York State Assembly: Is there any correlation between interest rates and strike actions? Can strikes be anticipated through economic indicators? SPENCE: Go ahead. FASKIANOS: You can take it. Who wants to start? BLOCK: I think Michael mentioned the most important factor, which is a tight labor market. I mean, that is clearly connected to this upsurge in labor activity, both in the strike activity and then also in this renewed commitment to organizing. There’s just—there’s a lot of risk under our legal system. There’s a lot of risk to workers who try to organize a union, who go out on strike. We have a law that’s really deficient in terms of protecting workers who engage in that kind of labor activity. And so a tight labor market gives workers the confidence that if they are retaliated against for taking this kind of activity, that they can find other jobs. And it’s really as simple as that as to why you see that correlation between a tight labor market and increased union activity. So I think that’s the most important factor. I think the issue of interest rates is just whether the Fed was going to raise interest rates enough to start driving that unemployment rate up and creating slack in the labor market, which then would have taken some of this dynamic—diluted this dynamic so that workers didn’t have that same confidence in their ability to find other jobs when they take the risk of organizing or striking. FASKIANOS: Michael. SPENCE: Yeah, I mean, essentially the same. I mean, so we—you know, the supply side of our economy, and the global economy has just changed dramatically, right? So it used to be almost infinitely elastic. You could have a surge in demand and, you know, somewhere somebody produced enough to meet it. That’s just not true anymore. That’s why we have labor shortages, as Sharon says. That’s why labor power is increasing. And as for inflation, you know, the trigger, you know, as we came out of the pandemic with a predictable surge in demand, and the supply side constrained by, you know, aging—you know, all the things we talked about. You know, we had a demand and supply imbalance. It was the trigger for inflation. Now, inflation can develop a life of its own, you know, once it goes on for long enough. But, you know, the economists look at this and say: When have we seen interest rates go up this fast and this high and not seen, you know, labor market problem? We just—you can go back a long way and try to find out an example of this. So, you know, this—what this tells you is that, you know, we have fundamental structural changes underway in the economy. And they—and the relationship between the labor markets and the inflation is that, you know, it triggered the inflation because the supply side couldn’t keep up. Now, what’s going on now, and I’ll just end with this, is, you know, the central banks, you know, can’t operate on the supply side of the economy. So they’re basically raising interest rates largely to reduce aggregate demand and get rid of that imbalance. And so far, they managed to do it without, you know, producing unemployment increases of any significant magnitude because there are labor shortages—short version.  FASKIANOS: Great. Thank you. I’m going to go next to Aaron Tebrinke, who’s legislative assistant to Leader Koehler of the Illinois Senate: After 148-day strike, Hollywood screenwriters secured significant guardrails against the use of AI in one of the first major labor battles over generative AI in the workplace. A battle for automation against AI, automation was won by labor. But what protections will workers have to keep up with AI tools in the marketplace that are not regulated for privacy? SPENCE: Sorry, can I—the concern of the writers was that, you know, they were going to get displaced, you know, by the use of, you know, the kind of generative AI, the large language models. That was, like, I don’t—that’s a bit of automation, but the underlying concern was copyright, right? Which is a major issue, right? Because it—you know, gen AI is trained on the entire internet. They just go read everything, you know, at speeds that exceed human capacities. So the question is, well, what’s the relationship between that and all the imaginative content that these and other people have produced that the AIs just hoover up? So that strike had multiple dimensions to it, and not all of them had to do with automation, for sure. FASKIANOS: Sharon, anything to add? BLOCK: Yeah, I think that that’s right. Obviously, we’re seeing litigation by content creators, many of whom are members of the Writers Guild, in order to get at this issue of their intellectual property rights vis-à-vis the use of these—the use of that content by the large language models. So I think we are going to continue to see many different fronts in the introduction of AI into the workplace, and as it impacts workers in different ways. So but to just to answer the, the part of the question about privacy, we have a very, very weak privacy regime vis-à-vis the workplace in the United States. And so you really—in the private sector. Now, that’s different in the public sector because you have a constitutional dimension to privacy in the workplace with public sector employers. So some of this might sound—might sound different than your own—than your experience, since folks on this call are from the public sector.  But in the private sector, we don’t really have an institution of privacy protections—as we now have AI surveillance of things like, you know, your email. There are employers now who very easily can just scrape every email that you write to find out all kinds of things about you, and you probably don’t even know it. That can watch you through the camera on your laptop when you’re working from your home. So I think these privacy concerns aren’t new in the workplace. But I think they’re going to be appreciated by, I hope, policymakers, but also by workers in a new way, as we see different uses of AI in the workplace. FASKIANOS: Great, thank you. I’m going to go next to Nate Belcher, who is a fiscal analyst for Arizona Joint Legislative Budget Committee: UAW included a thirty-two-hour workweek with no pay reduction as one of their bargaining points in their recent negotiations. Do you think that reducing the length of the workweek will become a more popular demand from labor in the coming years? BLOCK: Yes. I think—I mean, I think we’re seeing it already. I mean, I would say just a few years ago there was almost no serious discussion of a four-day workweek. That is now an issue that is on the table. I don’t know of any workers who have secured a four-day workweek through collective bargaining. There are certainly employers who, of their own volition, are experimenting with shorter workweeks, sometimes with four-day workweeks. You know, I don’t think that many people thought that the UAW contract at the end of the day would actually include a thirty-two-hour workweek.  I think it was put on the table as just another way to discuss hours. I mean, what was really an issue in the UAW strike I think around hours was the fact that many, many workers were being forced to work a lot of overtime. And even if they were getting paid for that overtime, it was having such an impact on their quality of life that it was really an entree to talk about what it is like to have those kinds of time demands, and what workers want in terms of having some kind of balance in their lives to be able to do with their time what they want. But I think the thirty-two-hour workweek is a conversation we’re going to continue to see bubbling up. FASKIANOS: Thank you.  Next question from Paul Egnatuk, who is the legislative aide in the office of the Michigan State Representative Jim Haadsma: I’ve heard recently of brick-and-mortar type investments stalled because investors are enamored with AI ventures. Can you recommend sources of research on the impact of private capital going toward AI development and/or where capital may be short for other pressing needs? SPENCE: Right, this is complicated. I mean, so, you know, there’s a massive amount of money going into AI. So some of the valuations are probably a little bit off the chart and, you know, that’ll get corrected over time. Some of us will remember the internet bubble, which had some of the similar characteristics. But that doesn’t mean there’s nothing there. But, you know, if you look at, I mean, vis-à-vis the previous subject, you know, hybrid working is becoming a very prominent feature of a subset of the economy where you can do that, right? And, you know, if you go into New York now and go into an office on Friday—you know, you’re very likely not to find anybody there. I mean, my friends tell me, don’t even bother. You know, so that doesn’t mean the work week is shorter, but it means, you know, that there’s substantial changes in the real estate sector and, you know, excess capacity of one kind, people—economic activity is moving around. I mean, on the whole, I would say the investment situation in the United States is reasonably healthy. You know, for the first time we have sort of major investments in infrastructure, you know, that have been funded by the government. And the CHIPS and Science Act has some more major investments, some of it designed to bring activity at home. And then we have the Inflation Reduction Act, which is designed to put, you know, funds into the energy transition in pursuit of sustainability. So when I look at the whole—I mean, there’s imbalances all over the place because of these structural transformations. And I’m sure we could find places where there’s significant deficits. But on the whole, I think the investment program, you know, or the investment situation looks moderately healthy. You are going to see just huge investments in the digital technology side as people pursue this set of opportunities. FASKIANOS: Sharon. BLOCK: Yeah, I don’t think I have anything to add. I mean, it is—it does feel like we are seeing more manufacturing jobs. I think we’re all—having come out of the Biden administration, I’m really excited to see sort of the full implementation of the Inflation Reduction Act and the CHIPS and Science Act. We just—I think, last week the president visited a site of the first—like, one of the first major investments. So I think that might balance out, you know, the kinds of trends that the questioner was raising. FASKIANOS: Emily Walker, who’s legislative director for Pennsylvania Senator Katie Muth, asked: Can you talk a little bit about the wave of organizing that’s been taking place in southern United States recently? BLOCK: Yeah, happy to. It’s a very interesting dynamic. So a couple of different trends. There has been a concerted effort, particularly driven by SEIU, Service Employees International Union, to do some kind of innovative organizing in the South. You know, the South is a very challenging place for the labor movement. Has been for a long time. And so there’s been a push to not do traditional union organizing but just try to get as many workers engaged in collective activity without necessarily using the traditional model of an NLRB election for majority exclusive representation within their workforce. You know, the South now is pretty much universally right to work, which just makes it a very challenging environment for traditional union organizing. So I think we’re going to continue to see these kinds of innovative campaigns. They’re really more like campaigns than organizing drives. The counter to that, though, is, like in the Starbucks organizing, there’ve been about more than 300 Starbucks stores that have unionized, and a number of those are in southern states. The South has not been able to sort of put up that wall to union organizing, at least among the Starbucks organizing, that they have in terms of a lot of other sectors. But the other dynamic, which it’s too early to know whether it’s going to be successful or not, but is what I raised at the outset about the UAW’s intent now to organize the transplant car companies. Almost—not all of which, but which predominantly have located their manufacturing in the South. And we also have—Ford is building the Blue Oval Plant, which is going to be, I think, one of the largest auto manufacturing plants in the country, if not the world. And they have now made a commitment to not try to stop the union from coming into Blue Oval. So that’s in Mississippi. That is going to be a union plant. That’s a big deal. But then the big question is going to be whether the UAW can organize other car companies that are not union in this. And I’ll note, they’re not union in this country. Most of these companies have unionized workers everywhere else in the world. And they seem to figure out a way to make money in plants in other countries with unionized workforces. They come here, and they fight the UAW sort of tooth and nail to keep the union out of their plants here, again, which are mostly located in the South. So, you know, we’ll see. I think after this most recent UAW strike, underestimating the new president Shawn Fain is not a good idea. He did things in this strike that nobody thought he would be able to pull off. So I think, again, one of the big stories in 2024 is going to be whether we’re going to see inroads for labor in the South, particularly through these auto companies. FASKIANOS: Thank you. And I’m going to sneak in one last question from Charisse Childers, director for Arkansas Division of Workforce Services: Michael stated it is not possible to think that robots can operate on their own. Do we have employment data on jobs that were added solely in conjunction with added technology? In the same vein, jobs lost solely in conjunction with technology, meaning robots? SPENCE: So, I mean, this a little bit nerdy, but, I mean, robot—human beings, you know, especially people who actually make things and, you know, do things in a physical environment, have, you know, an extraordinary capacity that robots don’t have. Which is an ability to absorb a rapidly evolving, you know, external environment, you know, visual and other signals, essentially with no latency. Robots aren’t even remotely close to that. And if you want evidence of it, look at the, you know, challenges facing the autonomous vehicles. You know, they do fine in highly structured environments, you know, where, you know, you’ve painted all the lines on the road, or you’re in a parking lot, or something like that. And then you put them in sort of an unusual situation, and they drive into a pile of cement or, you know, the emergency responders don’t know how to deal with them, and so on. You know, in other words, in unstructured environments, you know, the robots basically need help navigating around, even if they have the mobility and, you know, manual dexterity, and other things that are other dimensions of robotics. There’s people working on this problem, but I think, you know, this is an example—you know, one of the many—in which I think robotics and people are going to work together. You know, and you’re not going to see full automation. Maybe in structured environments. I mean, you see some of it—you look at—it’s not just manufacturing. You look at a, you know, major distribution center, an Amazon distribution center, there’s—you know, there’s a lot of robots. And this isn’t very snazzy technology. They just don’t bump into each other and they go collect things and bring them to the people who pick and pack them, scan them, and so on. So, you know, there’ll be progress in this. But my—having spent some time talking with AI people, I think that, you know, full automation, except in highly structured environments, is a fairly long way away. And we’re going to see mostly human—you know, human-machine kind of collaboration and those environments. And there are a lot of them. I mean, you know, if you go outside distribution centers and manufacturing things, and highly structured, you know, roadways and whatnot, pretty much everything else is unstructured, right? Hospitals, et cetera, so. FASKIANOS: Thank you. Well, unfortunately, we are out of time. But this was a terrific discussion. So thank you, Sharon Block and Michael Spence. We appreciate it. And to all of you, for your questions. We will be sending a link to the webinar recording and transcript, as well as some of the other resources that were mentioned. You can follow Dr. Spence’s work on CFR.org and Professor Block on X, formerly known as Twitter, at @SharBlock.  And, as always, we encourage you to visit CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for the latest developments and analysis on international trends and how they are affecting the United States. Of course, please do share your suggestions with us for future webinars and any ideas on how we can help you in the work that you are doing in your communities. You can email [email protected]. We wish you all a happy holiday season. And we look forward to reconvening this series in fiscal year—or, actually 2024, which is right around the corner. So, again, thank you both. We really appreciate it. SPENCE: Thank you. Thank you. (END)
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  • Public Health Threats and Pandemics
    Public Health Lessons From COVID-19
    Thomas J. Bollyky, senior fellow for global health, economics, and development and director of the Global Health program at CFR, leads a conversation on observations and lessons learned from states’ public health responses to the COVID-19 pandemic.  TRANSCRIPT FASKIANOS: Thank you and welcome to the Council on Foreign Relations State and Local Officials Webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. We’re delighted to have participants from fifty-one states and U.S. territories for today’s conversation. Thank you for taking the time to join us for this discussion, which is on the record. CFR is an independent and nonpartisan membership organization, think tank, publisher, and educational institution, focusing on U.S. foreign and domestic policy. CFR is also the publisher of Foreign Affairs magazine. As always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments, by providing analysis on a wide range of policy topics. We are pleased to have Tom Bollyky with us for today’s conversation on public health and lessons learned from the COVID-19 pandemic. We’ve shared his bio with you, so I will just give you a few highlights. Thomas Bollyky is the senior fellow for global health, economics, and development at CFR, and the director of CFR’s Global Health program. He’s also an adjunct professor of law at Georgetown University, and a senior consultant to the Coalition for Epidemic Preparedness Innovations. Mr. Bollyky is also the author of the book Plagues and the Paradox of Progress: Why the World is Getting Healthier in Worrisome Ways, and the founder and editor of Think Global Health, an online magazine that examines the ways health shapes economies, societies, and everyday lives around the world. So, Tom, thanks very much for being with us today. You recently co-authored a report on COVID-19 pandemic policies and behaviors. I thought you could talk us through the differences in public health responses that influenced states’ infection and mortality rates, and what you came away through this research for recommendations for future pandemics. BOLLYKY: Great. Well, thank you, Irina, for the kind invitation to be here and that nice introduction. It is—this is, I think, my third time, maybe fourth time, speaking to the State and Local Officials network. And it is one of my favorites in terms of a resource at the Council. I always learn as much from these discussions as I think I am able to impart, so I’m really looking forward the chance—to the chance to speak with all of you. And congratulate Irina and team for pulling together such a useful network. What the thing we’re here to talk about today is—it is—Irina, are you making faces? Is my internet causing trouble? FASKIANOS: Yeah, your internet—I was like, oh, no, his internet is freezing. So— BOLLYKY: Hmm, ah. Well, let’s keep going. FASKIANOS: Let’s keep going. BOLLYKY: And perhaps at some point I will turn off my video and do it just with the audio if it remains a problem. But apologies for that. Again, this paper appeared in Lancet six weeks ago. It’s a year-long study, the product of five different institutions. And I had the pleasure of co-leading that group. And it—what it was meant to look at is what explains the very large differences we have seen between how states, U.S. states, performed in the pandemic. And I think it’s been underreported, but perhaps not a surprise to this group, that while the U.S. overall struggled in the COVID-19 pandemic, not all U.S. states struggled equally. There is, in fact, a nearly four-fold difference in cumulative total COVID deaths from the worst to best performing U.S. states, even once you adjust for all the relevant biological factors—differences in the age of the population or key preexisting health conditions. For most of the pandemic, states like New Hampshire, Vermont, or Washington have actually posted COVID-19 death rates that are comparable to countries in Scandinavia, like Denmark, or in Europe, like Germany. While mortality rates from some other states have actually rivaled the worst-performing countries in the world during the pandemic—Russia, Bulgaria, and Peru. That difference, between top performers and poor performers, is large in health standards, even by American standards. For instance. The U.S. states with the shortest average lifespans come nowhere close to matching Chad, Nigeria, or the worst countries in the world on that measure of longevity. The state variation, though, is a reason for hope. Because if poorly performing U.S. states could more closely match their more successful counterparts when the next health crisis emerges, many lives might be saved. One estimate we have from that Lancet study is that if every state had performed as well as New Hampshire, the second—state with the second-lowest COVID mortality rate—there would have been 504,000 fewer U.S. deaths from COVID-19 during—just during our study period. That would have made the U.S. again, in terms of overall death tolls, very similar to other high-income countries, as opposed to one of the worst-performing countries, which is sadly where we were. I’m going to pull out just four specific themes about what drove those differences, and then I’m going to save most of the discussion about what do we do for this, because I really do intend for those to be mostly a conversation about looking forward and how do we respond to this. But four themes that came out from our analysis in the Lancet. One is—or, theme number one is that the role of health equity, socioeconomic and racial disparities, loomed very large in this pandemic. Larger than it does in many other—even larger than it does in many other U.S. health measures. So what we—what we saw was a cluster of factors—low educational attainment, limited access to high-quality health care, the percentage of people living below the poverty line—had a strong association both with differences between states, and their infection rates, and in their COVID-19 death rates. In many ways, this reaffirms what we’ve seen in the past, that these disparities played a large role in H1N1 and the response there. These disparities combined with racial disparities, which were also significantly associated with state variations in our study, also play a role in differences in seasonal flu vaccination. It’s not just in pandemics or infectious disease. Of course, in other health crises,­ you see these social, economic, and racial disparities loom large. And it will be important to proactively seek to mitigate these differences ahead of the next emergency. And we can talk a little bit about in the discussion of ways to do that. All right. Theme number two that came out from here. Trust, interpersonal trust in particular, played a large role in this pandemic in the U.S. Interpersonal trust, if that term isn’t familiar to you, is the trust we have in one another. And it is actually a finding that has been shown also in many international studies. For example, we did a—the same group did a study in the Lancet the year earlier on the global level. And we were unable in that study to find any connection between country variation and COVID outcomes in many of the leading theories or pet theories of what made a difference in the pandemic—like economic inequality, or pandemic preparedness metrics, or democracy, what have you. We didn’t find any links. But interpersonal trust had a very large and significant association with differences in how countries did. We see the same thing in the U.S. context, that the trust—how we feel about one another, the trust we have in one another, is tied to vaccination rate­s and adoption of health-protective behaviors. And that, in the end, has a large tie to the outcomes and how states did. Meaning that when confronted by contagious novel virus, government—most effective ways for governments to protect their citizens is ultimately by convincing them to protect themselves. And their willingness to do that, particularly in free societies and in U.S. states, depends on the trust we have in one another. And that’s going to be important to foster stronger in the future in thinking about how we respond to these things. Theme number three: The role of politics was nuanced in this pandemic. There is a perception political parties mattered a great deal in the response to this pandemic. But at least from our study, there is no association between the party of the leading state official, or state governor, or, in Washington, D.C.’s context, mayor, and COVID deaths. In fact, out of top ten states that did best, half—five of them are Republican and—five of them are led by Republican governors and five of them are led by Democratic governors. That said, there is certainly a role for politics in this pandemic. And the degree to which states voted for a particular candidate in the last election does seem tied to the adoption of health-protective behaviors, and vaccination rates, and the application of mandates. And that does seem to have had some effect. Which brings me to the last theme to draw out, which is mandates. And by mandates, I mean bar and restaurant closures, gathering restrictions, mandates around vaccination use—or, vaccination, or mask use, or stay-at-home orders. What we find in this study is that the package of mandates, or the broader use—because states tended to use many of them together, and nearly all states used some mandates in this pandemic, usually for roughly—for about a sixteen-month period. And what we found is they were generally associated with fewer infections. But it was vaccine mandates that had the largest effect on deaths. And there’s been a discussion around tradeoffs in this pandemic. We did find some. There weren’t any tradeoffs between overall economy and the adoption of health protective measures, but there were some tradeoffs particularly on restaurant closures and employment and there were some tradeoffs on educational performance in this pandemic. It will be important in the future to adopt—to apply these mandates in a way that they target the most vulnerable and are designed in a manner that it promotes getting back to work and getting into schools as soon as possible. They will also be important to combine with mitigation measures for the period in which they are in place. We can, again, talk a little bit about that. But those are the four themes to start us off, to draw us out. I’m really interested to hear about the experiences you all have had in the pandemic, and questions you might have about this study. And I will put the link to the study in the chat, if it’s not already available to attendees. Irina, do they have it already? Sorry, you’re on mute. FASKIANOS: Oh, can you hear me now? BOLLYKY: Yes. FASKIANOS: Great. Yes. They do have a link to the report. So we did send it out in advance. BOLLYKY: Great. FASKIANOS: So that’s great. I’m going to—now it’s great to turn to all of you. Again, this is a forum to share best practices, ask questions, and whatnot. And I want to go first to Dr. Jonathan Ballard, who’s the chief medical officer in New Hampshire—the New Hampshire Department of Health and Human Services in the office of the commissioner, since, Tom, you mentioned New Hampshire being in second—the second good story. I guess Hawaii was number one. So it would be great if you could just react and maybe share your thinking of what you—what else you will do in the future, Dr. Ballard. And if you accept the unmute prompt, that would be great. There you go. Q: Thank you, Irina. Thank you. So the question I have is around health equity and the diversity of the population. So some of the questions I have, particularly around your study, is does this study adequately adjust for the disparities in—related to health equity that we see between New Hampshire? New Hampshire’s one of the healthiest states in the country. And so, you know, the theory is that, well, you’re already a healthy population, you do not have obesity to the degree, you have lower smoking rates, you have high rates of physical activity in New Hampshire. And so is that—was that taken into account already into your study about why some states are performing well? Was it the underlying population was already healthy or not? I would conjecture that it’s not—it’s not simply that underlying fact, because there are several states in your report that are just as—nearly as health or heathier than New Hampshire but did not have the same outcome with the mortality rate. And I think that there several things that New Hampshire did do that was quite protective and did kind of go against the strain of what the national guidance was. Each time there was a recommendation that came out from the CDC or any other national body, we did look at it carefully, and noting particularly the recommendations around the vaccination priority populations. New Hampshire did not follow the national guidance on vaccinating frontline workers. We did a different approach. We looked at social vulnerability index and vaccinated those who had the highest risk of social vulnerability—of vulnerability, but then also looked at—made a big effort to vaccinate the other vulnerable populations, those in congregant facilities, nursing facilities, and other locations. And New Hampshire was the first to get to kind of whatever number you would—each state would get to with its vaccination rate. We had a lot of emphasis on speed, on delivery of the vaccines, and very seldom had any in reserve during the early months. They were all used. And I think a lot of that relates to what you talked to around the interpersonal trust, resulting in us being fastest to get the vaccines out. New Hampshire’s known as a—you know, the live free or die state, and individual liberty, individualism. But we didn’t have a lot of the culture wars. We’re a purple state. We have split government as far as state government versus our federal delegation. And we just didn’t see vaccines getting caught up in that, especially early on. So I just wanted to stop there and, Thomas, would be appreciative of your response on the was—what were the adjustment rates that you used, and did it account for just these healthier states did better, or not? BOLLYKY: Great. So the first one it’s a relatively quick answer, fortunately, which is the adjustment, it does, in fact, account for BMI, it accounts for rates of diabetes, cardiovascular disease. Really, an expansive view of the key comorbidities that might have made a difference in how states performed in the pandemic. So it is adjusted for that. And, of course, it is adjusted for age. I would draw out a couple things at least from our study, but obviously you lived the experience so I take your insights more—as seriously. But, you know, New Hampshire, as a state, is a little healthier than other states. Though New Hampshire’s average life expectancy at birth actually only ranks twenty-third in the U.S. out of states. So it’s around the middle. And its performance in this pandemic was better than that metric might have suggested. There are a few—about New Hampshire. It does have the lowest poverty rate, or percentage of population under the poverty line. It has the highest levels of interpersonal trust in the country. It has relatively few uninsured. Reasonably—among the top ten in terms of access to quality health care. It is also, you know, not a—as states go—not a particularly diverse state in terms of its racial makeup. But the—what people identify as in the U.S. Census. However, as you rightly pointed out, one of the things we’ve—in a follow-up piece that we wrote—pointed out that to the extent that New Hampshire does have social, economic, or racial disparities, the state was quite aggressive about addressing them in its vaccination program. And that seems to have made a large difference as well. In terms of our research, or talking to local officials, also they reaffirmed the view that you had put forward about a strong partnership between states and local communities in terms of enabling some of the local actors to have some agency to respond to what they were seeing as well. But we highlight New Hampshire, in terms of an example because, of course, unlike Hawaii it is not an island. But there is a lot—you know, New Hampshire has many advantages but again, as we pointed out, the health circumstances has some challenges too. And through aggressively addressing some of those challenges, the state did well in this pandemic. And hopefully more states are able to match it in the future. FASKIANOS: Thank you. So we have two questions on interpersonal trust, which I will—I will ask together. So the first one is from Colorado State Representative Parenti. How were levels of interpersonal trust measured? And then, from Alder Regina Vidaver in Madison, Wisconsin, she asked: What are evidence-based approaches to improving interpersonal trust? BOLLYKY: Great. So two fantastic questions. I will start with how we—the data sources we used for interpersonal trust in this study, and then I’ll just briefly reference how it can be measured more broadly. So the short answer is surveys. We have a set of surveys reflecting nine thousand respondents throughout the country, all conducted in 2019. Those surveys asked the question: Do you—how often do you trust others to do the right thing? The responses coded for most of the time being high levels of interpersonal trust. This would seem like a subjective question, but surveys—social scientists have been actually asking that question since the 1950s internationally. And you would be amazed how stable the values are for countries and communities. So that is the way people measure interpersonal trust through surveys. There are also, of course, experiments people do to measure them in a community, or they look to proxy behaviors that are suggestive of interpersonal trust. We use for this—for this study surveys. Now, what would you do with it? Well, a couple of things. Or, what’s the evidence-based interventions for interpersonal trust? First thing I will say is the government of Denmark actually monitored trust at the community level throughout the pandemic and adjusted its public health interventions to reflect those changing levels of trust. That’s just running a survey at the community level. Not cheap, but not impossibly expensive. But to give you an idea, for instance—because they convinced people that they will not the only who is vaccinated, that there won’t be holdouts. But in low-trust populations, they have the opposite effect, where they tend to inculcate hostility and a reaction. So that was used to tailor public health policies for different populations, just to give one example. As a general matter of how you build trust, and how you identify where there is low trust, and what you need to do differently to respond to that in the future. But hopefully that gives at least a start of the conversation around trust. FASKIANOS: Thanks. All right, the next question, we’ll take an oral question from Pennsylvania Representative Arvind Venkat. Q: Hello. My name is Arvind Venkat. I’m a state representative in Pennsylvania. I’m also an emergency physician. I had two questions. One is on did you distinguish in a large state like Pennsylvania, when you’re looking at it, between urban—or, among urban, suburban, and rural areas? Because the response in all of these area was very different in our state during the height of the pandemic. And the second question is, what specific legislative recommendations do you have coming out of your study? Thank you. BOLLYKY: Great. We did look at population density, but we only looked at population density at the state level. So the study in general functions at the state level. We don’t look at whether it’s at the ZIP code level or the community level. So that will have to be a future study. I will say population density, as the pandemic progressed, was less meaningful in terms of having a tie to either infection rates or deaths. And perhaps that might make sense from what we—what you’ve seen, what others—what we all have seen in the rural communities and how the pandemic experience has changed in those over time. In terms of legislative approaches, I think there are a few. I do think it’s important for states with high rates of uninsured, or states that have not extended Medicaid use or are reversing those policies. The study suggests that rates of uninsured did have a significant association with how states performed in this pandemic. Perhaps not surprisingly, and high death rates. So those are one area. Another is we did see an association between states that had adopted more generous family leave policies, or personal leave policies, and infection rates as well. And it will be important, whether they’re adopted on an ongoing basis or adopted in a manner that allows them to be expeditiously exercised in a health crisis, or extended in a health crisis. It’ll be important to have those structures in place. As I mentioned, whether it’s on politics or on social, economic, and racial disparities it’s really important to have ongoing community engagement, or to build these partnerships between state officials and community organizations or faith-based organizations. That’s perhaps less of a legislative matter, but certainly a matter of appropriations. And it’ll be important to have those partnerships established ahead of a crisis, because it is difficult to build them and use them and harness them effectively once the crisis has begun. But great questions. Thanks for participating in today’s call. FASKIANOS: So the next question is a written question from police chief Patrick Finlon, who’s in Village Cary, Illinois. And I’m not sure that this is in your area, Tom, but I will ask it: What were your findings related to the ability/desire to use/exercise governmental authority related to the shutting down of businesses and the application of constitutional provisions? I’m in law enforcement, and our risk management provider advised us not to close businesses for fear of a potential civil rights violation. BOLLYKY: Well, in terms of—what I can use on the use of mandates, in general, is there—although underreported—there is actually a surprising level of uniformity across states. There’s a perception that some states locked down and other states didn’t, and that that tends to vary politically. As an initial matter, lockdowns or use of mandates, rather, at the state level really over occurred over a sixteen-month period. Virtually all states from March until June of 2020 used some policy mandates. Where really you started to see the big differences in the outset of the Omicron wave, between some states reimposing them and others doing less so. But there’s a lot of uniformity to that at the state level. I will—I will forgo the—opining on the legal merits of the adoption of these, but there have been, of course, a good number of cases that have worked their way through the courts, some of which have gone to the Supreme Court, and they point to a few lessons on, you know, public health authorities/powers, and where they draw from and what they extend to. But, again, I will save that for a more legal discussion. FASKIANOS: Thanks. We’ll take the next question, raised hand, from Georgia Representative Imani Barnes. Q: Hello. Thank you for having me. I don’t think I can turn my camera on. But I was wondering, what type of educational data did you gather from this study? I was wondering the data compared to New Hampshire with other states that—I wanted to understand the disparities, educational disparities, that you gathered—the data that you gathered for educational disparities. And what suggestions do you have to mitigate the learning loss that the children experienced during virtual learning? BOLLYKY: Great. So the educational data we used for is average educational attainment. Again, like our metrics in the study, it is statewide. So by disparities, we’re talking the difference between states, and that average level of educational attainment. It does—didn’t matter a great deal in terms of showing differences between how states performed in this pandemic. Levels of—or access to high-quality health care or percentage of people below the poverty line does seem to have a pathway through vaccination rates, that states with lower rates of—or, a lower average of educational attainment had lower vaccination rates, by and large. So that’s the way we address that. On the learning gap question, I think the real answer is people don’t know as of yet, in terms of we haven’t really had a disruption of this duration and length before. So there are theories of what matters, from tutoring to, you know, more extended engagement or programs with students that fell behind. What I can say from our study is that the tradeoffs on the educational side were significant. All states suffered from an educational standpoint in this pandemic. Some states suffered more than others. It is unfortunately true that the same racial disparities and socioeconomic disparities we see in educational attainment, by other studies that have been done, suggests those were exacerbated in this pandemic. So it will be important to redouble and be aggressive about addressing those gaps. FASKIANOS: I’m going to take the next written question from Crystal Goodwin, who is with the Texas Council for Developmental Disabilities, and serves as a public health and disability integration specialist: If this were something that—if this was something that the study looked at, did the findings show any difference among states based on disability status or disability services offered? Something we found during the pandemic, and studies show, that individual with intellectual and developmental disabilities as a comorbid condition were in the top three of deaths here in Texas. BOLLYKY: I wish it was something our study looked at. It’s an important issue, and I really appreciate you raising it as something that deserves more attention, both by my colleagues and I but others in the future. So thank you for raising the question and, unfortunately, it was not in our study. But I wish it had been. FASKIANOS: It can be the subject of your next study. BOLLYKY: Indeed. FASKIANOS: Let’s go next to W. Abdullah Brooks with a raised hand. Q: Hello. This is—yeah, I’m W. Abdullah Brooks. I’m actually standing in for a representative from the state of Maryland, Scott Phillips. In full disclosure, I’m a faculty at the Bloomberg School of Public Health at Johns Hopkins, and with a background in infectious disease and global public health. First of all, congratulations on a brilliant study. And I haven’t had time to go into a deep dive, but I had just two questions that maybe you could elaborate on, if they’re not in your paper. One is, you talked about the correlation with employment and health outcomes. And given the structure of health care access in the U.S. often being tied to employment status, I’m wondering if you adjusted for access through, for example, those who have public assisted health access. Just to look at the question of health equity or equity in health outcomes, and whether or not there was any difference between those who are on public assistance, had access to public—to health access, hospital, and so forth, versus those who only had access through private insurance. That’s one question, just getting at the issue of equity of outcomes. The second, you have a reference to interpersonal trust. And during the beginning part of the COVID pandemic, the American Society of Tropical Medicine and Hygiene held a series of discussions around this and looked at specifically the issue of trust towards health experts—trust or distrust. And I’m wondering whether or not your paper looks at this specifically with regard to health communicators and health communications, and whether or not you gleaned any insights into messaging. And, you know, whether there were better or worse strategies with respect to trying to get messages regarding, you know, responses to the pandemic, and access to things such as vaccines. Thank you. BOLLYKY: Great. Thank you for such a rich group of questions. And thank you for the kind words about the study. On the employment side, the employment results are fascinating in the study, in that by and large most of the use of policy mandates are not associated with differences in employment. There is an association, in particular, with restaurant closures, which perhaps not surprisingly, given that sector. But there is an association between higher infections and higher employment. And that actually reaffirms what we’ve seen in other studies of the economic impacts of the pandemic. That it may have been less a matter of policy in terms of differences in economic impacts, and more in the responses of the population. So, meaning people that stayed home more cautiously, whether the state ordered you or not, had broader economic impacts. As a general matter, economically what you see in the pandemic is often a fair amount—and this is perhaps why the GDP levels aren’t shifted—or, have no association with the degree of public health response—is that you’re largely shifting economic activity between sectors. So less activity in restaurants and bars means more grocery. And you see some of that shift where all states suffered in the pandemic economically, but it tends to net out, to some degree, in terms of the various sectors positively and negatively affected. In terms of equity in the private and public insurance, we do include both public, private, and out-of-pocket spending—estimates of out-of-pocket spendings in our measure of health spending. We, unfortunately, do not break them down and see how the results might be different depending on the level of spending between each. But that too, like Irina suggested before on the disabilities, would make for an interesting follow-up analysis. So thank you for proposing it. On the trust in health experts, we do look at trust in government. Now, that is not—and we also looked at trust in science in the studies. Both of them also the product of surveys. As you rightly perhaps intimated, you know, trust in government does tend to vary by agency and area. There have been some good studies that have come out that have looked at trust in health authorities. And what you have seen are declines, particularly in trust in state governors, trust in federal health authorities. What I’ve—from what I’ve seen from multiple surveys or studies of this kind, what has really held up are your family physician. Local hospitals, local health clinics still enjoy high trust. They enjoy it across political lines. And that too may be something we can seek to leverage in the future but would be a different lesson than we’ve had in the past, where we have really emphasized having one voice speak in a pandemic, having it be at the federal level, perhaps having it be CDC. What the lessons of this pandemic suggest is that we need more community and local engagement, engaging trusted health sources of information. FASKIANOS: Thank you. I’m going to take the next written question from Commissioner Keith Baker from Colorado. Was the level of interagency—county, municipalities, healthcare, school districts, et cetera—coordination and collaboration evaluated in your report? And were there any lessons drawn from that? So we have another question too on this, about, you know, measurement of the level of intergovernmental cooperation and outcomes. BOLLYKY: Great. Thank you for the good question. No. I haven’t seen a good standardized data source of measuring the cooperation that occurred in the pandemic. There are different measures of polarization people have looked at, but they typically look at the legislature, state legislature, or surveys of the population and how polarized they are on particular issues, or politically. But the interagency cooperation’s an interesting question. But I have unfortunately not seen it well measured, particularly across U.S. states. FASKIANOS: All right. So the next question I will take a written—I see no more raised hands, so I will continue to go for our written questions. Next one from Vice Chair Mary Alford from the Alachua County Board of Commissioners, in Alachua County, Florida: Was good information found in states like Florida, where information shared was of questionable accuracy? How was that information treated—margin of error, sampling from other sources, et cetera? BOLLYKY: Great. So in terms of our study, we do—these are estimated death rates and infection rates. They do tend to be backed up by a variety of sources, including both state-reported data but also zero-prevalence studies and peer-reviewed data, is what we used from that. So that’s how we tried to adjust for the fact that some states may not have been reporting as actively or as rigorously as others. FASKIANOS: All right. Next question from Ellyan Veronica from the Puerto Rico Senate: What data did you find regarding unvaccinated people who suffered violations and interference in educational, medical, or other services by their vaccinated status? Not sure—Senator Martinez, do you want to ask your question? Maybe clarify it a bit? OK. Don’t think—oh, if you unmute yourself, you can clarify. No, that is not working. OK. Q: Yes. FASKIANOS: Oh, good. Thank you. Q: OK. Yes. I’m referring that what is the data did you find regarding the unvaccinated people who suffer interference with their educational, medical, and other services because they didn’t want to be vaccinated? Did you study that matter? BOLLYKY: We did, actually. So we look at vaccine mandates for state employees and vaccine mandates for school employees, and both their association with health outcomes, infection rates, and death rates, as well as whether they have any tie to shifts in employment or in lower educational performance, particularly for fourth graders. We used NAEP test scores. On infections and deaths, they are very much associated with lower rates of both. State employees, of course, it will not surprise people on this call, represent millions of people in the United States. So it’s not a small group. And you do see a strong association with fewer deaths from the use of those mandates. We did not find any tie between the use of those mandates and lower state GDP or lower employment. So nothing on the economic side. You do see an association with lower math test scores. However, almost all mandates were associated with lower math test scores. And what our theory there—so this includes things that have, you know, restaurant or bar closures—. And so the hypothesis is that association reflects the caution in the population. People who were less likely to send their children to in-person schooling, those children tended to—or, those states where that was happening at a greater rate—to do more poorly educationally. Because math is something that, I can say as a parent myself, parents don’t teach as well as the school settings do. So it really does seem to be a stronger tie between in-person schooling and better math test performance, at least for fourth graders. Sorry, that’s a long-winded answer. But most of what you could say is, no, I don’t see any educational, economic, or deleterious health outcomes from those vaccine mandates. FASKIANOS: So I’m going to take the next written question from Dawn Gresham, who is a community liaison in Senator Liz Krueger’s office of New York Senator Liz Krueger: It seems as though it would have been helpful if messaging had communicated that there would be saves in community infection levels requiring additional safety measures to be followed at times, and relaxing safety measures where possible. Because this did not happen, it made it more difficult to discuss reinstating certain measures when it would have been helpful. Can you share thoughts on best practices for handling communication? And, Tom, I’m going to add onto that. I think we’ve seen some backlash against other vaccines because of the experience of COVID-19, which could be potentially alarming for things that we have not had problems with, because vaccinations have been measles, and whatever, and how we deal with that. So can you talk about messaging and vaccines going forward for other diseases? BOLLYKY: Great. So on the communication side, I completely agree with the questioner on the premise that we struggled to educate the population on the fact that this was likely to evolve and to change. That is actually—there have been a relatively large literature on communication in this regard. And this ties to the earlier question we got about trust. In addition to monitoring levels of trust to try to tailor programs to low-trust communities, we do have good research on communication strategies that preserve the levels of trust you already have. So less on how do you build it in crisis, and more about how you slow its erosion. And one of them is—or, two of them are related to your question. One is transparency. So saying the quiet part out loud. For instance, there is a great study that looked at—they presented two groups of individuals with—or, two groups of individuals, rather, with information about a hypothetical vaccine. One of those groups received information about—that was vague about the side effects but suggesting that there may be some but somewhat vague about what they were. Another was very specific about the range of things you might find in those circumstances with the vaccine. And what you found in that is not that you had a higher rate of people willing to take the vaccine between those two populations, but the population that received more detailed and complete information expressed higher levels of—or, more sustained levels of trust in the health authorities that provided it. Suggesting, again, that transparency is important, but also—and this is the second lesson—trusting the population. In order to be trusted, governments have to be trustworthy, but they also need to trust the population to be able to understand what they’re communicating. And that is something we struggled with throughout in this pandemic. FASKIANOS: Thank you. I’m going to go next to a raised hand from Paul Rotello from the city of Danbury in Connecticut. Q: Thank you. Yeah. Paul Rotello, City Council, Danbury, Connecticut. Connecticut, in terms of geography, is one of the smaller states. In terms of population, it’s relatively moderate. I think it’s about thirtieth. Both Vermont and New Hampshire are not particularly big when it comes to geography, but they’re much bigger than Connecticut. Their populations are quite a bit smaller. So I was just curious as to what—there seems to be a little bit more elbow room, or maybe a lot more elbow room, in Vermont and New Hampshire, compared to Connecticut. I was curious as to what density played in your statistics and your analysis. And how would you even go about figuring that, because while you can live in a somewhat agrarian community, you may spend a lot of time in town at diners, and post offices, and things like that, or even at jobs? How do you tease that out? And were you able to tease that out? And did you see a difference? Thank you. BOLLYKY: Great. Well, I’m happy to get the question. I actually grew up in Stamford, Connecticut. So I know Danbury quite well. I went to high school in Fairfield. And so it’s nice to meet you and have this engagement on this. Connecticut, as a state, actually does well in our study also. It is ranked seventh in terms of standardized deaths. So, again, adjusting for the biologically relevant factors. We did not see a strong tie between population density and infection or deaths in this study. The reason why is over time—in the beginning, it mattered, in terms of the spread of the virus to communities in the initial wave of the pandemic. But over time it was more around economic geography. Congregant housing, people—percentage of essential health workers, people with a greater ability to avoid people that are infected or isolate on their own is tied more to economic geography than the population density. So there are some fairly rural states that don’t do well in this study because of, we suspect, these broader questions of economic geography. FASKIANOS: I’m going to take the last question from Alison Despathy, who has raised her hand, from Vermont. You need to unmute yourself. Q: Thank you. FASKIANOS: There we go. Q: OK, good. All right, thank you so much. So I’m here in Vermont. And my question relates to, back to the trust issue. And this is also sort of stemming from some of the swine flu history and what we saw go on there with a bit of the sort of marketing and propaganda around the safety and effectiveness of vaccines. So with regards to the trust, did you see any data or results surface around the fact that the COVID vaccines were originally sold as safe and effective, and included the ability to prevent COVID and prevent transmission? So there was clearly a level of propaganda, not necessarily intended. But many heard that, you know, this is the pandemic of the unvaccinated. So as actual vaccine impact surfaced vis-à-vis safe and the failure of COVID vaccines to prevent infection and transmission, did you assess the role of propaganda, marketing of pharmaceutical products, and any—? And thank you. BOLLYKY: Great. So we did not assess the role of mis- or disinformation in the study, other than trust levels. The trust levels that we had, of course, they had to, for the study to work, predate the pandemic. So we looked at levels of trust in 2019, the situation, effectively, the virus found us in. So we did not assess ways that might have changed over the course of the pandemic. Other studies certainly have. I will say that levels of trust declined everywhere, even in countries like Denmark or Scandinavia, famously high levels of interpersonal trust. The question is, how quickly and to what degree. And, you know, some of the good communication practices that we’ve talked about, and I’m happy to communicate more about with people via email, do seem to have been effective in slowing that erosion. But we didn’t look at the mis- or disinformation and how that changed trust in the United States. FASKIANOS: Thank you. Unfortunately, we are out of time. I’m sorry we couldn’t get to all of the questions. But I just want to ask you, Tom, to take just thirty seconds to talk about Think Global Health, since we have so many health commissioners and medical officers on this call. If you could talk a little bit about your magazine and what you’re doing there. BOLLYKY: Great. I will do that in twenty seconds, because in ten seconds I want to say that health crises are fought at the state and local level. And I am grateful to all of you for what you did during the pandemic, and what we will need to rely on you for in future health emergencies. I don’t think we’re getting enough attention on what states and localities need to succeed in the future. And hopefully, this study can help spotlight that. Now, that said, on Think Global Health, it’s an online magazine that’s meant to look at how health affects economies, societies, and everyday lives. It’s been up for about three years. It has been—it’s analysis has really been picked up everywhere, from the New York Times to the Atlantic to Fox, across the aisle. More than eight hundred pieces published, from authors from sixty countries around the world. We would welcome state and local members of this network contributing. And it’s ThinkGlobalHealth.org. And thanks, again, for your time today. FASKIANOS: Thank you. And thanks to all of you. We will disseminate the link to this webinar recording and the transcript. We will circulate again the report that Tom Bollyky authored—co-authored, as well as the link to ThinkGlobalHealth.org. We’ve also dropped those links in the chat. You can follow Tom on Twitter at @tombollyky. And, as always, we encourage you to visit CFR.org, ForeignAffairs.com and, of course, ThinkGlobalHealth.org for more expertise and analysis. You can also email [email protected] to let us know how CFR can support the important work that you are doing. And we do recognize all the hard work that you are doing. As Tom does go—not enough attention is given to it. So thank you for all you’re doing. Thank you for being with us. And thank you to Tom Bollyky for your efforts.
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    Navigating U.S. Economic Uncertainty
    Brad W. Setser, CFR’s Whitney Shepardson senior fellow, leads a conversation on the likelihood of an economic recession, the current debt ceiling debate, and recent instability in the U.S. banking sector.  TRANSCRIPT FASKIANOS: Thank you. Welcome to the Council on Foreign Relations State and Local Officials Webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. We’re delighted to have participants from forty-eight states and the U.S. territories with us for today’s conversation, which is on the record. CFR is an independent and nonpartisan membership organization, think tank, publisher, and educational institution focusing on U.S. foreign and domestic policy. CFR is also the publisher of Foreign Affairs magazine. And, as always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. We’re pleased to have Brad Setser with us today for our conversation on “U.S. Economic Uncertainty.” Brad Setser is the Whitney Shepardson senior fellow at CFR, where he focuses on global trade and capital flows, financial vulnerability analysis, and sovereignty debt restructuring. Prior to this role, he served as a senior advisor to the United States Trade Representative and as a deputy assistant secretary for international economic analysis in the U.S. Treasury. Dr. Setser is also the author of the book, Sovereign Wealth and Sovereign Power and the co-author of Bailouts and Bail-ins: Responding to Financial Crises in Emerging Economies. Brad, thanks very much for being with us today. I thought I would throw you a softball question and ask you to talk about the state of the U.S. economy and what we’re looking at, especially in light of the debt ceiling discussions in D.C. SETSER: Well, I think the economy is in an OK, but not great, position right now. Clearly, the economy has slowed substantially compared to the initial phases of the recovery from the pandemic. But that slowdown was largely the expected response of the withdrawal of some of the fiscal stimulus and the Fed’s tightening. What I think, though, stands out right now is that there's enormous uncertainty, as the title of this panel suggests, about the future economic outlook, large possibilities of significant deviations from a sort of stable, orderly path of growth. So I thought I would highlight what I think are the three biggest risks, just to get the discussion going. The first risk is, in some sense, we are driving through terrain that we don't fully understand. Largely because the effects of the pandemic are so with us and a once-in-a-century, or once-in-a-millennium pandemic is not something that was easy to model or has been easy to model as we emerged from it. We should remember that we never really saw the kind of shutdown of the U.S. economy that we experienced in the second quarter of 2020, in the very early days of the pandemic. I mean, both Irina and I were in New York at the time, and the city literally shut down for a period of time after the enormous initial outbreak and while we were waiting for the vaccines, and basically learning how to manage this particular pandemic.  That shutdown had reverberations and consequences that have stayed with us over time. It’s left the path of economic growth—it’s created a much more unstable path of economic activity than is typical in the U.S. economy. Obviously, it's hard to disentangle the effects of the pandemic, per se, from the effects of the policy response to the pandemic, the initial rounds of stimulus under both the Biden and the Trump administrations, and then the snarls in global supply chains that complicated the path of recovery. Those snarls reflected both a shift in demand towards goods and away from services, which was really quite substantial when you look at the data, and then the fact that we encountered infrastructure constraints as well as production constraints around the global economy. In 2021, our ports literally couldn't accommodate all of the containers coming in with all the goods our economy was demanding. And then because there was such repressed demand, we had, like, an enormous trade deficit in the first quarter of 2022 and then a big fall-off in trade late last year, which actually had nothing to do with any change in trade policy. It was simply the fact that it, you know, there was such high demand for goods in 2021 that wasn't really met until early 2022, but then there was a fall-off in demand once our economy had kind of adjusted to this new equilibrium. One sign that these pandemic-related disruptions aren't completely past is pretty straightforward, when you think about it. Auto prices are still up quite a lot, quite significantly. Normally, when prices go up supply responds, production goes up. But only very recently has U.S. automobile production—it's also true for North American automobile production—recovered to the levels that we had before the pandemic. Our economy didn't forget how to produce cars, but the availability of the semiconductors needed for a modern car was really constrained. And that limited the ability of the economy to respond as one would expect to a clear signal from the market. So there was just—whenever you look closely at the U.S. economy, you find relationships that have held for long periods of time that aren't quite holding as one would expect, even three years after the pandemic. We still haven't managed to return to a fully normal economy. We're still dealing with some of the aftershocks. So that creates one source of uncertainty. The second source of uncertainty is that the Fed really did tighten rates quite substantially last year and early this year. It’s the largest tightening cycle in recent economic history, largest and fastest, going from zero to five in a very—in a relatively short period of time. And that tightening cycle, you know, clearly was a response to the fact that inflation was above the Fed’s target, through the tightening of supply because of the higher demand from some of the policy responses to the pandemic. No one doubts that inflation was above target. No one doubted the Fed needed to react. And I don't think anyone really doubts the Fed needed to react quite strongly.  But the magnitude of the increase in interest rates and the pace of the increase in interest rates is large. And there's always a risk when you tighten monetary policy that you do too much, that you push the economy, or you tighten—you pull back the economy too, too heavily. And rather than bringing the economy back into equilibrium, you push on the brakes too hard, the economy stops. And effectively, there's a recession. There's also a risk of doing too little. You don't tighten enough. The economy slows, but not enough to bring down inflation. And the concern then is that expectations about future inflation become entrenched and inflation never comes back down to pre-pandemic levels. So the Fed has had to try to navigate between those two risks. And it has had to do so while driving over uncertain terrain because of the pandemic and dealing with the normal uncertainty that accompanies all Fed policy. The Fed’s monetary policy famously works with what are called long and variable lags, which means that the effect of tightening last year is still being felt in the economy this year and will still be felt next year. An easy way of seeing that is when you think about how trade responds to a Fed tightening cycle. The dollar goes up, but it takes eight quarters before all of the trade impacts of a stronger dollar typically feed through to the U.S. economy. When interest rates go up, that impacts housing. Impacts the affordability of homes. All that, though, feeds through to the broader economy over time. It doesn't happen instantly. And it doesn't always feed through at the expected pace. There's arguments why the pace of tightening last year, that the normal lags will be shorter. Financial markets looked ahead. long-term interest rates went up very quickly even before the Fed completed its tightening cycle. That arguably pulls forward some of the contractionary impact.  But there are other variables which suggests that the lags may be particularly long. We didn't actually see the labor market tighten very significantly when the Fed started raising interest rates. Employment has remained very strong. Inflation has come down, but maybe not quite as much as the Fed might have hoped. Although I think there's some evidence that is feeding through. But famously, I think, one of the ways in which lags are long and variable is that the main way monetary policy tightening tends to impact the U.S. economy is through the banking system. And for a long time, it wasn't obvious that the Fed’s tightening was slowing the banks, that it was pinching on the banks, that it was restraining bank lending. It took actually a really long time before higher Fed interest rates led to higher deposit interest rates and problems for those banks that had, in effect, bet that deposit interest rates wouldn't go up that much and therefore they were going to be safe, even though they put a lot of their portfolio into bonds, long term what are called agency-backed securities, repackaged mortgages, that gave you a bit of a yield pickup back when interest rates were zero, but you locked in 2 or 3 percent interest rates over a really long period of time—seven years, five years.  Long enough that when now that deposit rates have started to come up, the banks are losing money on this part of their portfolio. We know this because this was the bet that Silicon Valley Bank and a few others made, and when colossally wrong. The banks effectively depleted their capital because of a bad bet on interest rates. Simple error, not a complex error. Silicon Valley Bank didn't go get into trouble because it lent to Silicon Valley Bank. Silicon Valley Bank got in trouble because it bought really safe securities, but locked in low-interest rates for too long and wasn't prepared when the Fed raised rates. But the net effect is that after a long period of time, when Fed tightening, higher short-term interest rates didn't seem like it was impacting the banking system, all of a sudden we've seen a lot of evidence that it really has started to impact the banking system and that the banks are going to cut back on lending. And so one source of uncertainty—it's very much on the minds of Fed officials—is that the Fed has to calibrate how much this new contraction in bank lending is going to slow the economy and, therefore, how much more they need to do by raising policy rates. Or, whether they should pause or even pull back lower rates, which they aren't going to do.  But, you know, conceptually, if you thought that this was going to impact the economy so heavily that the economy would naturally slow and pull inflation below target, you would be cutting not raising. The difficulty for the Fed is that it is very hard to calibrate exactly how the combined effect of last year's increase in interest rates and this year's banking crisis will impact the economy over the next several quarters. Which adds to the risk that the economy may slow more than expected. A third source of uncertainty is the obvious one, the debt ceiling. I personally would prefer if we didn't have a debt ceiling and if we weren't threatening the U.S. government with default every few years when government is divided. The debt ceiling though generates one of two outcomes. One outcome is essentially a disaster. If the U.S. defaults on its debt or if the U.S. prioritizes paying the deb but doesn't have the capacity to borrow new money and has to cut back heavily on all other activities of government, the U.S. economy goes into a big contraction—if that is sustained for any period of time whatsoever. There's absolutely no ambiguity about it. The only ambiguity is whether the U.S. prioritizes treasuries, which Treasury says will be very difficult to do, or whether it defaults. If the Treasury prioritizes treasuries, it's probably good for long-term bonds. If the Treasury defaults, it's probably a disaster for bonds. So there's uncertainty about, in that situation, which way the Treasury would—which option the Treasury would go for and how it would impact long-term bond prices. Which is a problem for bond traders. But there's no question it hits the economy hard, it hits equity markets hard. It would fundamentally be a self-created disaster. But because everyone knows if you actually went into default or could not honor other promises of the government—and pay wages, pay bills, pay social security—that it would be a disaster, the assumption is that there will be a deal. And if there is a deal, the economic impact is probably pretty modest. There's a bit of extra uncertainty that maybe slows the economy just a bit, but it isn't devastating. So we're faced with what is sort of fundamentally a low probability of a really high-impact event, which is something that is very hard for markets to discount and price. So we're in an economy with multiple sources of uncertainty. That's almost always the case. But I think many of those sources of uncertainty are actually unusually large right now. And we're at a delicate time. We're always—it's always a delicate time when you're trying to bring inflation down without putting the economy into a stall. So it's a challenging few months. FASKIANOS: Fantastic. Let's now go to all of you for your questions or comments. You can either click on your screen to raise your hand or else you can put your question in the Q&A box. If you do that, please identify—tell us who you are. And I'll read the questions and/or call on people who have raised their hands. And we really love to hear from you live, so do consider that.  So the first question that we have is from Mike Zoril, who is a District 14 supervisor in Rock County, Wisconsin: How does the debt ceiling impact the banking sector? And what are the potential consequences if the ceiling is not raised in time? I think you—I think he may have typed in that question before you got to the third part of your scenario, but is there anything you want to expand upon that you didn't cover in your in your points, Brad? SETSER: Well, I think there's one obvious way in which the debt ceiling impacts the banking sector, and one perhaps less obvious way. The obvious way is that an awful lot of banking transactions are collateralized with treasuries. So they're secured by treasuries. So the one way in which you reduce risk associated with short-term lending is that you lend someone cash, but you they give you their treasuries in return. And you do that, you think you have an absolutely safe extension of credit. It is the safest thing you can do.  If your counterparty doesn't pay you, you have treasuries which are money good. And if treasuries aren't money good, then all of a sudden a set of transactions that underpin our banking system would become problematic. And I mean, in some sense, the consequences of that are so dire that the operating assumption is that the U.S. government wouldn't stand still, that it would quickly cure the default. But if there were an extended period of default, a set of transactions between banks that are considered super safe suddenly stopped being safe. I think the second impact is more subtle, and I'm not actually 100 percent sure it's true. But when people put money in a bank they're counting a bit on the quality of the bank, the safety of that particular institution, the wisdom of that bank’s manager, the quality of the loans. But most of us don't monitor our banks that closely. We trust the federal government to supervise and we rely on Federal Deposit Insurance to make sure that our money is good, even if the bank fails. And if the Treasury is in protracted default, what worries me a little bit is that some people might wonder whether the credibility of the U.S. government's backstop for bank deposits remains intact.  I can come up with arguments for why it would. The FDIC has some independent authority. But ultimately, if the U.S. government can't borrow, the U.S. government cannot do an awful lot of things. And many of those things are pretty essential to financial institutions. FASKIANOS: Thank you. I'm going to take the next question from Ronald Campbell, who's the co-chairperson and treasurer in the Office of Georgia Representative Lisa Campbell, District 35: Is there an economic positioning system similar to GPS for navigating in the economy? If not, what are the key economic coordinates to monitor? SETSER: Like, unfortunately, you can't turn on Google Maps and get precise instructions for how to go from point A to point B. There's a range of tools and data points that the Fed, the White House, the Treasury do use. Financial market variables are very important. Financial markets are important in and of themselves. They tell you how much it costs to borrow. But they also can give you some insight into how professional traders are interpreting the economic data. And that can help provide some guidance. There is data from surveys that tell us how consumers view the economy. There's data from surveys that tell us how businesses view the economy. The federal government collects data on wages. It collects data on the number of people who are employed. And those labor market variables tend to be some of the best high-frequency indicators of how the economy is doing. And then we collect various data points that measure how consumers are spending, what retail sales are, some are pretty well-defined in real-time. Others are less so. And between those variables and kind of old-fashioned physical measures like how much freight is moving on trucks and how many containers are coming through the ports, you can get some guide to how the economy is doing. And that can help you use your policy tools to try to get to the destination. I think the hard part is that there's lags between when things change in the economy and when you see them in some of these data points. And it is hard to forecast with the same precision that Uber can forecast whether you're going to get to your destination in eight minutes, ten minutes, fourteen minutes, or twenty minutes, how policy changes, like the Fed’s tightening, will impact the economy in one quarter, two quarters, or three quarters. So there's those difficulties that make it hard to have the same kind of precision that we get from GPS, and the new Google Maps and Uber software tools. FASKIANOS: Thank you. I'm going to take the next question from Robert Cantelmo. If you could unmute—accept the unmute prompt and tell us who you are. Q: Hi, thank you so much. Brad, thanks for sharing these remarks this afternoon. My name is Robert Cantelmo. I'm a City Council member in Ithaca, New York, and the Democratic candidate for mayor. We've heard a lot about the potential for remote work throughout the pandemic. And I know several small and midsize cities had hoped that we might be able to leverage this modality shift into some economic opportunity over the intermediate term. However, as you're noting, we're in a period of uncertainty and relative instability. And I was wondering if you could care to comment on how modestly sized cities might better prepare to weather that uncertainty, especially with the lens on, you know, how you think it might impact our long-term ability to attract capital investment and keep up service delivery over a period of inflationary pressures? SETSER: That's a hard question. I mean, to be honest, I don't think municipal government should be forced into the position of having to think about how to manage a default by the federal government. I think it's much better for our economy and our society when the only question municipal governments face is whether the federal government might provide help to manage their budgets during periods of global or national economic stress, like during the pandemic, when municipal governments have to think about how to manage risk that really can't be managed. I think that's asking a bit too much.  I mean, just stating the obvious thing, you know, if you're putting your cash in a treasury money market fund, you would normally think that would be the safest thing in the world. But there are scenarios where short-term treasury bills are in default and what normally would be the safest thing in the world, safer than a big bank deposit, isn't safe. So I do think it's probably important to think about sources of cash if there is protracted default, not that you want to but probably be a good idea.  And then, if there is either a default or if there isn't a clean resolution of the debt ceiling, so that there's going to be a series of high-profile games of chicken that push up borrowing costs. I don't think municipalities can insulate themselves from that because municipal bonds price off the treasury market. I think you just have to plan for the possibility of higher interest rates that impact your borrowing. I think it's probably good practice to have stress tests on your access to the municipal bond market. Make sure that municipalities have access to enough cash that you can survive if there's a period of interruption.  But at the end of the day, if you can't afford to borrow you can't afford to make a lot of long-term investments. And that will constrain any municipality’s ability to position itself for the future. I worked a lot in my stint in government on Puerto Rico. And Puerto Rico lost access to the municipal bond market, and it was devastating. Absolutely devastating. They relied heavily on short-term borrowing because of some weirdness in how they had pledged sales tax revenue. So they pledged sales tax revenue to first go to the bonds and then go to the budget. So they had no sales tax revenue for the first six months of the year, and all their sales tax revenue came in from month seven to month twelve. And they typically borrowed short term during the first six months of the year against their expected sales tax revenue in the second half of the year. But when you couldn't pay your long-term bonds, the banks wouldn't lend to you short term, so you were faced with the risk of a really tight cash flow constraint. And that just illustrated to me some of the complexities of municipal budgeting. And the fact that you have to have probably more buffers than the federal government typically has. Because the federal government, you know, historically has able to operate with a limited cash buffer because of the consistency of its ability to access short-term bill markets and always raise cash. FASKIANOS: Thank you. I’m going to go next to Robert Myers, who is a senator in Alaska: What's the current outlook on energy markets, especially oil and gas? SETSER: Oh, I think some people—I know there are many people, maybe some on this call, who probably are better positioned to answer that. You know, there is no doubt that one of the biggest sources of uncertainty in the global economy over the past twenty-four months has been energy markets.  Russia's invasion of Ukraine and the associated sanctions, and the reduction or elimination of a lot of pipeline flows of natural gas to Europe, have all disrupted global oil markets profoundly. A world where Europe no longer buys oil from Russia, at least not tanker oil, and most of Europe, not pipeline oil, and instead has to import oil from everywhere else, and where Russian oil goes to Turkey and now to India—a lot goes to India, as well as China and parts of Asia—that has lengthen the amount of time Russian oil has to spend at sea. And it has, like, disrupted the standard global flow of oil in so many ways. So obviously, last summer, that meant really high oil prices. And really high oil prices then in turn induce—you know, markets work. People started drilling more. It took a little while, longer than I would have liked, but markets have responded. There are more sources of oil supply. And then high prices tend to reduce demand. And China has been weaker than expected. So right now, the oil market seems relatively well supplied. But the oil market is not a completely free market.  And on the supply side, OPEC and OPEC+ work to manage the market. And the Saudis have signaled that they don't want oil to go much below seventy. I tend to believe them. And I think the U.S. now is doing something that is quite smart, although maybe we're not doing it as nimbly as we should, and I would like to have more capacity to do this quickly and do this with more force. But we're starting to refill the Strategic Petroleum Reserve. We signaled that we'll kind of start buying some oil, which should also put a floor under markets.  The natural gas market has really stabilized. European gas prices have come way down, thank God. And thank a relatively mild winter in Europe that left gas storage full. But we are in a different world now than we were twelve months ago, because the European natural gas storage tanks are full. So—and Russia has exercised its option, it's exercised its threat; it’s not supplying Europe with gas. And Europe was able to get through the winter. It overpaid for LNG for a while. It no longer has to. So that's putting downward pressure on gas prices. So my sense is that oil prices won't go much lower, largely because the producers are now in a position where they're going to respond to weakness. We're hitting the limits of their willingness to tolerate lower oil prices. And we're also hitting levels where the U.S. should refill the Strategic Petroleum Reserve. And if oil prices stay at this level, there'll be some reduction in drilling. So that's my sense of where we are, but I don't follow the oil market on a day-to-day basis. FASKIANOS: We will—that's a good note for us to cover that in a future webinar. So we'll put that on our list of things to delve deeper into. So thank you for that question, and for your response, Brad. I’m going to go next to Commissioner Aaron Mays in Shawnee County in Kansas: It seems like the rate of inflation has slowed some in recent months. Is there a possibility of some deflation or should we permanently adjust our budgets to accommodate higher wages and prices? SETSER: Well, Irina left out one critical part of my biography, which I was actually born and raised in the state of Kansas. So, hi. It’s—Shawnee Mission was always, you know, aspirational for me. We used to go to debate tournaments there. And the Shawnee Mission High Schools in that era were the best-funded in the state of Kansas. So I hope the high quality of the Shawnee Mission School Districts has been sustained over time. I mean, deflation is an unlikely, I would say, possibility. And we're currently on a trajectory which economists called disinflation, which means that we're going from high inflation to medium inflation, and hopefully back to lower inflation. So the pace of inflation is slowing. But deflation would be an absolute fall in prices. And given the tightness in the labor market and the momentum in prices, that seems an unlikely outcome. I do think the most likely outcome is that the pace of increase in inflation continues to fall. And that means that the Fed will be closer to its target than it is now.  So in a forward-looking basis, the Fed wants price increases to get down to about 2 percent a year. We went up to eight, which is too high. We're now at four-ish, I think. And some of the forward-looking indicators would suggest that we're going to be on a trajectory where we should get down to three. Certainly, the pace of increase in housing prices have slowed. And in some places, housing prices are coming down. But the way the inflation series is constructed, it's kind of complicated, but it's basically the average of price increases over the past twelve months. So it just takes a long time before that feeds into the measured variable. And that is expected to bring the pace of rent increase, as measured, down. Wage increases are still pretty strong. And that's expected to keep service prices up. Although, there’s a hope that they will be generally coming down in response to the Fed’s tightening and the contraction of banking credit. But they will come down without too much of a drag on the economy. But in terms of budgeting and forward-looking forecasts, I think it is safe to forecast, to expect price increases of—that are a little above the Fed’s target for the next couple of years. And then there's a debate about whether they will be back precisely at the 2 percent target or maybe a little higher, but I think it’s really unlikely that we would have an extended period of inflation where there was no increase in prices or a fall in prices. That would be an indication that the Fed had overdone it, and that’s something that typically only happens in a pretty serious recession. FASKIANOS: Thanks. We’re going to take the next question from Commissioner Bob Heneage—my apologies if I mispronounced it—of Teton County in Idaho: What is the likelihood of—the federal government will attempt to claw back unspent American Rescue Plan Act funds from local governor—governments? Excuse me. SETSER: Very low, because that would be political suicide for any member of the House of Representatives. I think there will be some efforts to claw back or not use some of the unspent federal resources, but anything that has already been provided to the states and municipalities I think is safe. I haven’t thought in detail—I don’t know in detail if there’s a pool of money that has been pledged to state and local governments but hasn’t yet been disbursed, and I would watch that. But anything that has already been transferred is yours. And if it’s not, I mean, wow, that is a—that’s crazy politics. FASKIANOS: Next question we’ll take from Beverly Burger, who has raised her hand. So if you can unmute yourself. Q: Sure. Can you hear me? FASKIANOS: We can. And identify yourself, please. Q: Yes, Alderman—I'm sorry. Excuse me. Alderman Burger from the city of Franklin, Tennessee, just south of Nashville. Sorry, I came on a little bit late, so I didn't hear the very, very first part, but did get most of it. But can you shine some light on how what is going on right now in our economy affects our local city investments in funding new water treatment plants, new city hall? We're thinking of partnering with an entity to build a larger conference center, not to own it but to partner with them, in a way. A few water projects as well. I might just say that our city plans conservatively on our budget. We’re a AAA-rated city, and we have a policy of having 33 percent of our general budget in reserves, which right now we have 54 (percent). We have a low property tax, heavily rely on sales tax at 9.75 percent. We also impose road and facility and parkland dedication fees on new development. Our sewer plant’s already been built. We already have long-term funding for that. But my question is, how wise is it right now to invest in these other projects mentioned in the coming two years? And, by the way, our city is about 88,000 in population and we are AAA-bond rated. SETSER: Well, the best advice would be that you should have borrowed a ton of money back when interest rates were really low during the pandemic and locked in that funding. But that's unrealistic. And obviously at that time, there was a concern that the economy might not bounce back, and that demand wouldn't be there, that you didn't need to plan for projected growth. I would not let—personally, I would not let too many long-term plans be impacted by timing around the bond market. Long-term borrowing is up a bit. It's more expensive, clearly, than it was two years ago.  But, you know, the U.S. Treasury is borrowing at 3 and 3 ½ (percent). I don't know where a AAA muni can borrow. So there's going to be a subset of projects that maybe made sense when you could borrow at 2 percent that don't make sense when you can borrow at 4 percent. I wouldn't recommend borrowing a lot at 6 (percent). But if you can access markets at four nominal, to me if you can confidently forecast growth in revenues over time that will generate 4 percent growth if the economy performs normally, and you've got a decent reserve, you should go ahead and make necessary investments in your infrastructure. But clearly, the cost has gone up a bit. I just don't know how much it has gone up for AAA munis over the past few years off the top of my head. FASKIANOS: Thank you. Let's go next to Jeremy Gordon, who is Polk County, Oregon commissioner: What other inflation responses outside of the Fed are possible but not talked about? SETSER: Well, fiscal cuts tend to reduce inflation. To some degree, those are being a little bit talked about now because of one possible outcome of the debt ceiling. Tax increases clearly slow the economy and slow inflation. Now there's, you know, a little bit of a debate about exactly how. And, you know, I think a lot of people if the sales tax goes up, they think inflation has gone up because the price they actually pay is gone up when, for an economist, they would say, well, if you increase sales tax than other prices are going to not go up as much, and so the price—the underlying price level growth will slow. But I understand that's not quite how most consumers think. But those would be the kind of classic tools that are outside of the Fed. Some have argued, and it's a very debated proposition, that reducing the monopoly or power of some big businesses would lower prices. That you could get more competition in the economy, lower markups, and that that would help bring prices down. And some have argued, and this has obviously been a partisan fight, that the U.S. government could help lower drug prices by negotiating the price it pays the big pharmaceutical companies for lifesaving medicines.  I tend to agree with that. I think there's no good reason why U.S. medical prices are many multiples of the prices paid in Europe and other jurisdictions that have access to the same meds, same quality that we do. But that's been a huge source of political debate, as we all know, over the past ten years. But I do think that that is something that was talked about but is no longer talked about because it has no chance of going through our Congress. FASKIANOS: We go next to a question from Rob Hotaling. And if you could accept the unmute prompt. Q: Hi. Yes. Can you hear me? FASKIANOS: We can. Q: Perfect. Thank you so much. Yeah, hi, this is Rob Hotaling. So, the question really isn't around the impacts of economic uncertainty—oh, by the way. Deputy commissioner of Connecticut's Economic and Community Development. So yeah, my question is around what are the impacts of economic uncertainty on investments? Earlier you mentioned IRA, no clawbacks, things like that be political suicide, to quote you. But I am wondering from an infrastructure, workforce training, technology, and innovation perspective, looking at our state, in Connecticut, what we can do and what we can advise our businesses and individuals to do in Connecticut. Of course, the rest of the nation probably has the same concern about economic uncertainty as regards to investments. SETSER: Well, there's a certain amount of uncertainty that is a fact of life in a capitalist economy, in a market economy. And businesses and states have to manage that uncertainty. There's a set of standard recommendations. I think, the Alderwoman from Tennessee highlighted some of that, which is that, you know, holding buffers on hand to help manage the unexpected is always good advice, even though it is costly. But the bigger, I think, issue is that there's a set of sources of uncertainty in our economy that it would just be helpful to eliminate. The debt ceiling as a source of enormous uncertainty that hopefully we will be able to get through without having a catastrophic outcome. I don't think, as I said earlier, that that is something where state and local officials really should be responsible for having to help people navigate it. There is no good way to navigate it. It is really the responsibility of the federal government to figure out a path forward.  And then there is no easy way to manage through a period when, for a broad set of reasons, our economy is slowing. We've gotten a relatively strong recovery by global standards from the pandemic. We’re much closer to the level of output that you would expect had there not been a pandemic than some other economies throughout the world are. We came out of the pandemic with, you know, a very strong economy powered by a very large stimulus. That stimulus has mostly been withdrawn but is still partially—there's still some lagged effects of that withdrawal of stimulus. And we came out so strong that the Fed felt the need to slow the economy. And there is—there is nothing that localities can do, other than maintain standard buffers, to prepare for the possibility that the Fed will either overdo it or underdo it. But this is this is a time when you—I think, sensible forecast would not expect a very high probability of very strong growth. There's a pretty high probability of relatively weak growth, just because the Fed is trying to grow the economy. And then there's a small probability of a really sharp slowdown, most obviously induced by the debt ceiling but possibly induced by further banking stress. So I would weigh my decisions according to that distribution of outcomes. Q: Can I ask one follow-up question? Is that feasible? FASKIANOS: Sure. Sure, go ahead. Go ahead. Q: Just Connecticut, like a few states, has a pretty healthy rainy-day fund. When roughly the majority of America thinks we're going to enter a recession, what is your advice for states like Connecticut who have a healthy rainy day fund and a surplus? Do you—we're not looking for state financial advice, per se. We're just saying, what is the overall guidance on considerations for what to do with that rainy-day fund ahead of a recession, considering the inflationary environment we're in? SETSER: I think a rainy-day fund is a very good thing to have when there's a recession. So this would not be a time to run it down. We're in a period of heightened uncertainty. If the recession—if a recession materializes, if you see a fall in revenues, then that is the time to start drawing on the fund. I would wait until the economy has kind of normalized, we're back at normal growth and normal inflation and we're past the debt ceiling, before making any long-term decisions about levels of spending and revenue that would materially reduce that buffer over time. Q: Perfect. Thank you so much. FASKIANOS: So, Brad, there’s a question from Commissioner Robert Sezak in Somerset County, Maine: There's been talk of invoking the Fourteenth Amendment to eliminate the debt ceiling provisions. What would be the impact of that course of action? And I think I just—you say that you think it should be eliminated. SETSER: Yeah. If I were given unlimited authority, I would personally get rid of the debt ceiling and just live in a world where the U.S. government was constrained by the budget, and any approved budget—which will have embedded in it a forecast of spending forecasts about revenue—any spending authorized by the budget itself authorizes the debt issued to fund that budget. So you—I don't think you need a debt ceiling, per se. Most countries around the world don't actually have debt ceilings. There's a lot of debate about what would happen if the Fourteenth Amendment were invoked. I think it is fair to say that the effect of invoking the Fourteenth Amendment would be smaller than the effect of a default or the effect of forcing the U.S. government to run a cash budget and not borrow, and thereby really scale back spending. And then you have to factor in, if you scale back spending you're going to, like, lose a little momentum in the economy. Revenues are going to come down. It just becomes pretty devastating pretty quickly. So if that's your alternative, invoking the Fourteenth Amendment is—will generate better outcomes. If your alternative is raising the debt ceiling so that you don't default and can keep borrowing, you can avoid some of the uncertainty associated with the Fourteenth Amendment. The uncertainty associated with the Fourteenth Amendment is, as I understand it, as follows: The Fourteenth—the use of the Fourteenth Amendment would be challenged in the courts. And any debt—there would be a question about whether any debt issued after the invocation of the Fourteenth Amendment is constitutional.  And so that that debt would likely trade in the market at a slightly different interest rate and a bigger discount than debt issued before the U.S. invoked the Fourteenth Amendment, at least until there was clarity from the courts. So during that period, there would be uncertainty about how the courts would ultimately rule. I personally think, and I may be influenced by my friend and colleague Anna Gelpern who’s been writing about this at Georgetown Law School, that the Fourteenth Amendment is—the intent of the Fourteenth Amendment is pretty clear. And that the president would actually be on strong constitutional and legal grounds to say that it is unconstitutional to default.  I think that actually is the meaning of the words that were written in the Fourteenth Amendment. Anna has uncovered some interesting historical evidence that the goal was to make sure that the Union didn't default on the debts incurred to fight the Civil War. That seems like pretty clear intent that the U.S. government's federal debt should be paid. That was the purpose of that language. But it is not uniformly accepted. It would be challenged. And therefore, we would have a new source of uncertainty if that were to be invoked. But, to be clear, the worst outcome is protracted default. FASKIANOS: We have a raised hand from Liane Taylor. Q: Good afternoon. Thank you. Liane Taylor. I'm from Montana Department of Commerce: And my question is a little bit of a different take. With all this information overload in the world right now, could you recommend one or two comprehensive sources of good information, such as you are imparting to us? SETSER: You know, I think the major national newspapers actually do a pretty good job of reporting financial and economic news. So I rely pretty heavily on the reporting of the Wall Street Journal and the reporting of the New York Times. If you can afford it, the reporting from Bloomberg is also excellent. But I draw pretty heavily on the mainstream financial media. And I think, as a participant in some of these policy debates and some of these financial debates, I generally feel like both the news coverage of the Journal and the news coverage of the Times accurately reflects the state of the real debate that's going on. I don't think that there’s any lack of—I mean, I'm impressed, often, by how well-informed they are, particularly about discussions around the Fed’s policy in the state of the economy. So I would I would, boringly, draw on the conventional press. FASKIANOS: Great. I wanted to just look at the questions we have in the chat. Where should we go next? Let's see. There are questions about if the federal government does not put a restriction on its spending, how long can they keep borrowing given its debt is already over $31 trillion? Is from Michael Yu. SETSER: To be honest, there is no obvious limit. Japan has borrowed up to 200 percent of its GDP at low-interest rates. There's no sign that the federal government has difficulty funding itself. The absolute level of debt is high. It's about 100 percent of GDP when you do a certain amount of netting, which I think is normal. And the budget deficit’s about 5 percent of GDP, which is a bit higher than the level that is consistent with a stable debt-to-GDP ratio. I generally think it would be a good idea to move over time towards a budget deficit that is consistent with a stable debt-to-GDP ratio. But there isn't a clear limit on what an advanced economy like the U.S. can borrow. If you borrow too much, you'll start putting upward pressure on Treasury interest rates and that will be a signal that you probably need to move more quickly towards a more restrained deficit. But the basic rule of thumb is you don't want a debt-to-GDP ratio that is increasing forever. But there isn't a clear limit on how much countries can borrow. U.S. debt is high, relative to our history. It is roughly equal to the debt of most European countries in aggregate. For the EU as a whole, debt is about 100 percent of GDP. Germany is lower. France is about where we are. Italy is a bit higher. Japan is way higher. And there’s a huge debate about China. If you just look at the debt of China’s central government, it’s well below the debt of our federal government. But China has a lot of debt, much more debt than we do, at the state and provincial level. There’s a lot of hidden debt there, a lot of backdoor borrowing. So if you include all that, China’s debt is actually not that far below ours. So the absolute level certainly seems high, but it is not wildly out of line with global norms. And financial markets are currently quite comfortable lending to the U.S. for ten years at 3 ½ (percent), which is above where it wasabut it’s not a rate that suggests any near-term risks that the U.S. will cease to be able to borrow to fund some spending. FASKIANOS: Great. So I’m going to go back to Mike Zoril, who has a question. He’s from, again District Fourteen supervisor of Rock County, Wisconsin: What specific plans and actions would be taken if there were a widespread collapse of banks? You know, taking into account the possibility that the FDIC may not have enough funds to cover all the losses? Would a bail-in strategy or the implementation of a new digital currency system be viable solutions? And how would this—you know, the introduction of FedNow affect this process? And the impact might it have on the monetary systems of the BRICS countries? SETSER: So a digital currency is not a solution to a problem with the banks. A digital currency runs the risk of pulling funds out of the banks. A lot of economists think of a bank account as basically a digital dollar already, a digital dollar that pays, in some cases, a bit of interest. A digital dollar that is outside the banking system creates an alternative to keeping your money in the banks. It would weaken the banking system, or at least runs that risk. The likely response to further banking distress—and, you know, that hinges on an assumption that the FDIC, the Fed, the Treasury, using their existing tools, won’t be able to contain the distress. And I think that’s unlikely. I think the FDIC, the Treasury, and the Fed have made it clear that they intend to protect deposits in the financial system by using the so-called systemic risk exception is a major bank fails. And that systemic risk exception lets you backstop the deposits using the money in the FDIC fund. And the FDIC fund can be replenished by a levy on bank deposits. So, it will—it can be renewed without any new budget appropriations. Which makes it, I think, unlikely that it would run out, particularly because the banks that get into trouble going forward will likely be—if they get into trouble, likely will have slightly better balance sheets that Silicon Valley Bank, some of the other banks that have already failed, and so the losses would be smaller. But in the event that there was greater banking distress, I think the first response would be to use the provisions in Dodd-Frank that allow the FDIC to request a straight up or down vote in Congress on an increase in deposit insurance. So, I think the most likely response will be to request that Congress fully guarantee all bank deposits, so that people didn’t have to worry about whether their money in the bank was safe. There’s certainly some other technical things that the Fed would do to make maybe it a little less attractive for money to move out of the banks into money market funds. Greater bank distress would increase the probability that there’d be rate cuts.  So there’d be a lot of responses. But the first response would be to expand FDIC deposit insurance, which takes in most circumstances, I think, my read—the cleanest way to do that certainly would be for Congress to approve it. And then if there were really much deeper bank distress, then you would have to consider whether the U.S. government should request—or, the U.S. should have in place the capacity to put capital in the banks, which is what was done in 2008-2009. That’s an enormously political—you know, so that is, in a different way, runs the risk of being political suicide. But putting capital into the banks is way better than letting our financial system collapse. But to be clear, I think the measures that have been introduced to date will contain the crisis. I think it is clear that the FDIC, the Treasury, and the Fed have the authority to protect deposits in any bank that fails, and they intend to do so. FASKIANOS: And, I’m sorry, at this point we have to close. I am sorry we could not get to the rest of the questions, the raised hands. SETSER: And I’m sorry I closed on such a down note. There is a—there is a path forward where these uncertainties are resolved and the U.S. economy continues to plow ahead. We’ve surprised people by not having a recession yet this year. That was sort of a pretty widespread forecast at the end of last year. And it’s certainly possible that many of these sources of uncertainty will resolve themselves and that we will be able to enjoy an economy that continues to move forward at a reasonable pace. Unfortunately, the level of uncertainty is high. FASKIANOS: And there was a question in the—in the Q&A box about do you want to put a percentage on that, Brad, of what is that certain amount? Would you express it as a percentage? Plus, minus, standard deviation? Do you want to have—or do you want to just leave it as— SETSER: I think any forecast would have to be, at this point, contingent on the resolution of the debt ceiling. And I don’t have a good forecast of that. I certainly hope that it’s resolved. If it is resolved, I think the chances of a recession are between one-third and a half. FASKIANOS: Great. This has been a fantastic discussion. Thank you very much, Brad Setser, and to all of you for your great questions, written and raised. We will share a link to this webinar recording and transcript. You can follow Brad on Twitter at @brad_setser. And Brad also has a blog. It’s called Follow the Money. And you can subscribe to it on the CFR website. We will include a link to it when we send the follow-up note for this webinar. So you can follow what he has to say on a more regular basis. So, again, Brad Setser, thank you very much. I encourage you all to follow us. Go to CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for more expertise and analysis. And do email us, [email protected], to let us know how we can further support the important work you are doing. So, again, thank you all for being with us and thank you, Brad. SETSER: Thank you.   
  • Infrastructure
    Electric Vehicle Infrastructure Deployment
    Alex Schroeder, chief technology officer at the Joint Office of Energy and Transportation, and Michael Moltzen, deputy director of the Transportation and Climate Division at the Environmental Protection Agency’s Office of Transportation and Air Quality, in conversation with CFR Adjunct Senior Fellow Heidi Crebo-Rediker discuss the bipartisan Infrastructure Investment and Jobs Act and provisions for sustainable, resilient, and equitable transportation projects including electric vehicle infrastructure deployment, grid integration, and decarbonization across the transportation sector. TRANSCRIPT FASKIANOS: Thank you. Welcome to the Council on Foreign Relations State and Local Officials Webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. CFR is an independent and nonpartisan membership organization, think tank, publisher, and educational institution focusing on U.S. domestic and international affairs. As always, CFR takes no institutional positions on matters of policy, nor do we accept government funding. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. We appreciate your taking the time to join today’s discussion. The webinar is on the record. The audio, video, and transcript will be made available on CFR’s website after the fact at CFR.org We’re delighted to have you all join us from forty-nine states. The conversation is on transportation and electric vehicle infrastructure, and this webinar is part of a series on the Bipartisan Infrastructure Investment and Jobs Act designed to help officials at the municipal, county, and state level take full advantage of the program. So, with that, I’m going to now introduce our distinguished panel: Heidi Crebo-Rediker, Alex Schroeder, and Michael Moltzen. Heidi Crebo-Rediker is an adjunct senior fellow at CFR and a partner at International Capital Strategies. Prior to her time at CFR, she served as the U.S. Department of State’s first chief economist. Heidi was also the chief of international finance and economics for the Senate Committee on Foreign Relations. Alex Schroeder is the chief technology officer at the Joint Office of Energy and Transportation. He is also a research manager at the National Renewable Energy Laboratory’s Center for Integrated Mobility Sciences, where he leads a group focusing on electric vehicle charging, grid integration, and commercial vehicle decarbonization. And prior to his time at the National Renewable Energy Laboratory, he served in the Colorado Governor’s Energy Office and the Western Governors Association, where he led programs related to transportation fuels and clean energy. And Michael Moltzen is the deputy director of the Transportation and Climate Division at the Environmental Protection Agency’s Office of Transportation and Air Quality. He has been with the EPA for twenty years and currently leads national programs that address transportation-related climate impacts, innovative place-based transportation, and environmental justice initiatives. Michael’s currently heading the EPA’s implementation of the $3 billion bipartisan infrastructure law’s Clean School Bus Program. So, with that, I’m going to turn it over to Heidi to moderate the discussion, and then we’re going to go to all of you for your questions and comments. And as a reminder, this is a forum to share best practices amongst you. So, Heidi, with that I’m going to turn it over to you all. CREBO-REDIKER: Thank you so much, Irina. And I guess just before we got on the call we heard that there were five hundred confirmed participants today, so to everybody who joined thank you so much and welcome. We hope that this latest CFR State and Local Official(s) Webinar on EV vehicle infrastructure deployment will be useful. And just as a—as a quick background, I mean, the Biden administration has made a huge priority investing 7.5 billion (dollars) in EV charging, 10 billion (dollars) in clean transportation, and over 7 billion (dollars) in EV battery components and critical minerals and materials. And these programs are also complementary to the Inflation Reduction Act support for advanced batteries and tax credits for purchases of EVs, and so this is part of sort of an overall strategy to move towards cleaner vehicles. As part of this, the National EV Infrastructure Program has created a nationwide and interconnected network of charging stations along the National Highway System, and we—there’s an ambition for half-a-million chargers across the country by the end of the decade. And as Irina already mentioned, we are so lucky to have these two speakers with us today. They bring a very unique expertise to these topics, and I hope that we do have a good interactive conversation with you after. I’m going to kick off with a few questions and let Alex and Mike talk a little bit about their various platforms. And what never happens but what happened today was just before this webinar there was a Politico headline that hit my inbox that said “Soaring EV Sales Lead Chargers Playing Catchup: U.S. consumers are finally gravitating to electric vehicles. It’s up to the charging infrastructure to keep pace.” So, with that, I would love to hear from Alex to start: Where are we in the process of deploying the funds for building out this EV network? And I’d just love to hear sort of, you know, what some of the challenges and opportunities are from your side as well. SCHROEDER: Yeah, absolutely. It’s a great question, and quite frankly, I think, a good problem to have, right? I think we have seen EV sales go from two percent to ten percent of all vehicle sales in the last three years. We’ve got 140,000 charging stations out there, up forty percent over the last two years, but more of all of the above are needed. The infrastructure bill sets aside $7.5 billion to build out the national charging network you’re describing. That is not the only investment in the infrastructure bill, and I’m sure Mike has more to say about that. But maybe I’ll start with those two programs and where we are at. There’s two really core components. There’s $5 billion which is formula funding that goes to states. The priority there is really to build out charging along our highway corridors initially so there will be a charging station every fifty miles along our major highway corridors in the U.S. All of the states as a condition of that funding were required to submit plans to our office last August 1. Those plans were reviewed and approved before the end of the federal fiscal year in September and President Biden actually announced the first billion-and-a-half dollars going to states last September. So the money is flowing and, really, the states are now moving ahead with issuing RFPs to work with vendors, the private sector, and other partners to build out that network. So we’re in a really exciting phase where that is ramping up. And then just recently the Department of Transportation released a $700 million solicitation for community and corridor charging program. And really kind of the important and, quite frankly, probably primary use of charging stations is going to be closer for home and for those shorter trips, and so we’re really focusing that investment on, again, the intersection of corridors and communities but also providing charging for areas that might otherwise have low utilization, disadvantaged communities, and really wanting to see the benefits of Justice40 realized. So the funding is flowing. Cities, local governments, states are all eligible for the grant program. And then the formula funding program, you know, we’re certainly encouraging and have seen really great collaboration by the state departments of transportation with all of the local stakeholders. So really excited, I think, about the progress that we’ve made and what’s in front of us as well. CREBO-REDIKER: So I guess one—my first question would be that, in terms of deploying, the formula funding tends to disproportionately favor the bigger—the bigger states, where you also have the larger uptake of EV, like California and Florida and Texas and New York. How are you dealing with both the states that are not particularly quick to take up EV ownership, you know, for a whole host of reasons, but some of those states are also some of the more disadvantaged states, the lower-income states? And how do you kind of—how do you make sure that the funding that’s going out, both the formula and grant, doesn’t just go to the states that have the most capacity and the most use? Because if you’re making this a national—a new national infrastructure project, then it needs to be truly national. SCHROEDER: That’s a great question, and I will be the first to admit the formula has a lot of nuances that I’m not fully versed in. I’d have to defer to my Federal Highway Administration colleagues on that. It’s a combination of population, miles of highway, et cetera. That was the direction we got from Congress. I will say there is flexibility in the program as well. I mentioned the Discretionary Grant Program, which, again, allows for really strategic deployment and to ensure that there is an equitable deployment as well. That’s also a requirement even in the state plans to make sure that all communities are being touched, particularly disadvantaged communities. There is also in the formula program a set-aside for what is—we can generally refer to as gap filling. So it does give some discretion to the Department of Transportation to help really fill those strategic gaps and potentially come in and be a little more directive with some of the things you’re talking about. CREBO-REDIKER: Great. I’d love to pull Mike into this conversation, first to talk a little bit about the climate implications of this—of building out the EV infrastructure and then, after that, maybe touching on the Infrastructure Investment and Jobs Act the Clean School Bus Program, because a lot of state and local governments are actually—particularly local governments are looking to utilize the facility. And how might they do that? And I’ll leave that over to you to tackle. MOLTZEN: Sure. Thanks, Heidi. Yeah, I’m happy to talk about this. This is—and I appreciate the opportunity to be here, including with Alex, who’s—his work in the joint office has been a great help to the folks in my office, and it’s great to collaborate. We’ll talk a little bit, maybe, about some of the other ways that we’re collaborating as federal agencies. But the—so the—I think in the simplest terms electrification of transportation is an opportunity that we can’t afford to not take advantage of to make progress on the climate crisis. This administration has prioritized that, both addressing the climate crisis and advancing environmental justice in communities that are disadvantaged. And we could talk a little bit about that, too. So, you know, some of the estimates that are roundly agreed upon suggest that we have to reduce carbon dioxide or greenhouse-gas emissions drastically and dramatically if we are going to avoid the worst effects of climate change moving forward. That’s accepted as fact. And we are fortunate that we are in a—at a time and place where we are seeing really dramatic advances in electric transportation technologies. It wasn’t long ago that I’m sure most people couldn’t conceive that we would have the numbers that we have today in terms of electric vehicles. You know, outpacing the charging capacity is probably what some people would consider to be a happy problem, right? You know, and folks like Alex and others are ready, willing, and able to tackle the infrastructure challenge, and we are there too. So, you know, it’s simple, in my mind, to think about how does electrification of transportation benefit us from a greenhouse-gas reduction perspective. And if you think about, you know, what the average—you mentioned school buses, and I’ll talk a little bit about our school bus program. An average internal combustion school bus uses about 1,500 gallons of diesel fuel annually, which equates to seventeen tons of carbon dioxide. So you could see there—and that doesn’t—that equivalent doesn’t account for upstream emissions, but there is quite a bit of work out there that suggests that even when you do account for upstream emissions from power plants that generate the electricity there is still a net—a substantial net CO2 or greenhouse-gas reduction benefit in electrification. So if we are able to replace conventionally powered diesel and gasoline vehicles with electric, we will make—that’s our best bet, you know, in the near term for making progress toward our ambitious climate goals. So I hope that answers your question, Heidi. And I don’t know if you had a follow-up there specifically that you’d like me to address? CREBO-REDIKER: Well, I guess, I mean, a lot of the people on the—on the webinar are sort of—they’re practically involved in this: How do we get the funding? You know, who do we turn to? How do we make the application? And particularly for clean school buses, sort of how have you seen that—how have you seen the funding deployed? And what are the resources that folks on the call could actually turn to if they wanted to access the funds? Do they just do it through their state? Who do they call? Do they need to call anybody? Should they call you? (Laughter.) What—so just in the practicalities, because I think the Clean School Bus Program was a very—you know, a significant initiative of the Biden administration, but we want to make sure it works. MOLTZEN: Yeah. Yeah. We’re really excited about it and we are—you know, we’re grateful that we have a bit of history in implementing these kinds of programs to build upon. But simply put, the bipartisan infrastructure law, it gave EPA—I’m sorry—$5 billion toward clean school buses. So that’s not just zero-emission electric, but very much emphasizes the replacement of diesel school buses with electric school buses. And that funding—our first funding opportunity was announced a little over a year ago, or a little less than a year ago I should say, when we announced our clean school bus rebate offering, which was a lottery program. So we—the way that the applications were selected were through lottery, once they were deemed eligible. But we did have prioritization criteria in there that made sure that we were hitting the types of districts and the types of areas that Congress gave us direction to prioritize. Namely, low-income areas, low-income school districts, rural school districts, and tribal school districts. We initially offered $500 million for that program. And we got an overwhelming response of about $4 billion in applications. Based on that, we made the decision to increase the amount we were offering in that first offering to close to $1 billion, so effectively doubling what we were planning to allocate to eligible applicants that were selected for rebates. That offering closed in August, and we are working closely with all of our selected rebate winners. That’s about four hundred school districts nationally representing about 2,500 electric school buses that will be procured through that part of the program. And those districts, maybe some of which are on this webinar today, they have a deadline this month to get us their payment requests in so that we can process those and get the money flowing, and get it out there so that they can put those buses into service soon. And we are preparing for our next funding opportunity, which we announced is going to happen this spring. So very soon we will be launching not a rebate program, but a clean school bus grant notice of funding opportunity, that folks can apply to. And the primary applicants—eligible applicants are state and local agencies that have responsibility for the school system transportation and the purchase of school buses, as well as nonprofit school transportation associations, eligible contractors, and tribal organizations. CREBO-REDIKER: So one of the themes, I think, of some of the other webinars that we’ve had is that a lot of the less-advantaged areas that you’re trying to target might not have the necessary resources to do the application process, or to figure out their way around where to even go to put together one of these applications. Are there any resources that you are aware of within the federal government or maybe nonprofit that people on this call who might not have done the first-round application but would be interested in a grant in the second round, but might need some help filling out those applications to make them competitive? MOLTZEN: That’s a great question, Heidi. So, first of all, we spent a lot of time and effort curating our website, our clean school bus website. And that’s the best place for people to go to get information about what funding is currently available and what resources are available to assist in applying. The rebate program that I described was designed in part to be simple and straightforward, a one-page application for school districts out there that are eligible to apply, and the other eligible entities. And it was very much intended to be something that we could kick the program off efficiently, and timely, and without a lot of administration necessarily to be concerned about. Our next offering is our grant program, which will be a little bit more nuanced. And we will be offering—again, I would encourage folks to go to our website. It’s epa.gov/cleanschoolbus, one word, to learn about opportunities. We’re going to be hosting webinars once we launch the notice of funding opportunity. We learned that webinars like this one are really effective in getting out information to stakeholders, collecting questions. We’ve got an active question and answer library that we update on a very frequent basis. So a lot of times if you have a question, chances are that somebody else would have the same question. We can help answer that. And we’ve got really good resources on applying for a grant—in general, for a federal grant. I’m sure it can seem daunting, but following certain steps can be really helpful. And we’ve seen people do that effectively. And our grant programs have consistently been over-subscribed, which I think is a good indicator that they work and that they are not too difficult to apply to. SCHROEDER: Heidi, I might jump in quickly. We’re—the Joint Office is not necessarily supporting specific applications of grants, but we’re working with Mike and the team at EPA, as well as others, to provide technical information on the content and the substance. So not to plug another website, but driveelectric.gov, you know, really intending to be the front door for technical questions on this so that, you know, if folks have a question about utility and our connection processes, or charging technologies, case studies, et cetera, that’s a great place to go. We also have a concierge service where folks can send in questions. So just wanted to provide that as a resource as well. It’s not going to necessarily help you meet all the—dot all the I’s and dot all the T’s with the application, but in terms of content and substance trying to really pull up and highlight best practices there. CREBO-REDIKER: OK. Well, I’m going to ask everybody—all the participants in the audience to start thinking about the questions or comments that you want to flag when we—when we get there, which will be shortly. But just a question, Alex, on standards. There have been some challenges on the EV charging standards, and how you’ve been trying to harmonize those standards as you roll out over—especially over long distances. How are you addressing the standards question? SCHROEDER: Yeah. Great question. So, actually, February 16, I want to say, the Federal Highway Administration published a set of minimum standards for Federal Highway Administration programs. So for the $7.5 billion I was referring to. And generally, this is something we’re thinking with, you know, just to try to provide that harmonization. And it really does—you know, I think the challenge and the opportunity here is to really have that national network and to have that consistent user experience. Thake the highway system as an example. It really started as a system—four lanes, consistent signage—connecting population centers of fifty thousand or more. Those aren’t our criteria, but we are looking for similar criteria that if you’re charging in New Hampshire, or New Mexico, or North Carolina, or Montana, or Alaska, you know what to expect if it’s a federally funded charger. And I think, just given the magnitude of the investment, and I would say the favorable feedback that we have gotten on the standards, we hope that this will really become the de facto standard for the industry and help to be a catalyst for that broader adoption and, quite frankly, uniformity that we have lacked previously. CREBO-REDIKER: So I think the last point I want to touch on, because it’s—you know, some of the characteristics of the application, your emphasis on equity, particularly targeting disadvantaged, and low-income, and tribal communities, is what—you know, what we’re trying to achieve with, I think, the law—either the law, or the regulatory, you know, how we’re deploying this, is that at least forty percent of the benefits are going to those communities. How are you prioritizing and I guess how are you—what kind of results from the first round of funding have you seen targeting that particular policy? And I’ll leave that to both of you for both buses and for EV charging. MOLTZEN: Well, I’ll jump in for the buses. And I can say that—so it’s both an administration priority, as you mentioned, forty percent or as it’s come to be known, Justice40, is an all-of-government priority, just as you said, Heidi, that ensure that a minimum forty percent of benefits reached disadvantaged communities across the country that have historically been, you know, not in receipt of all the benefits that are available publicly. And we did have also congressional direction through the bipartisan infrastructure law. The statute directed us to prioritize those communities. And we’ve done it in a way with the Clean School Bus Program. We’re looking at data regarding children—school children that are in poverty. So if a district has twenty percent or more of the students in its district that are at or below the poverty level, they would be prioritized. And in being prioritized, they have the ability to access more of federal share for the cost of a zero emission or electric school bus than otherwise. And that’s been—it was extremely successful. I believe the end result of our first offering and rebate program was—we reached about ninety percent, it might have been more than that, of our rebate selectees are in those disadvantaged communities, or tribal, or rural. So we’re really pleased with that. And we’re going to build on that success moving forward. But I’ll let Alex chime in here. SCHROEDER: Well, I think that was a great—it will be hard to follow that on. But I think, Heidi, it’s a good question. And I think, quite frankly, it’s a huge opportunity, making sure this is a just transition. Electrification by all measures is really—it’s speeding up, and we want to make sure that everyone benefits from that. So everyone from the American worker to the driver, right? And so I think a lot of—to Mike’s points, a lot of the administration policies are really intended to lift that up. With the NEVI Program, and I would just say generally, equity really starts with engagement. And community engagement was a requirement for all of the states. And the NEVI plans really describe how they are engaging their communities in having this conversation, because not all communities are going to have the same needs. So really kind of matching up the needs and the opportunities, and having that dialogue, I think is step one. You know, the discretionary grant program has equity as a focus as well, and so that’s certainly something where we’re encouraging applications. That’s criteria that we’re going to be looking at. So, you know, I think just in general we want to do what we can to ensure that this is a just transition. Again, going back to providing technical assistance, but also helping support this engagement, and making sure this is a dialogue with communities and we’re not taking one-size-fits-all approach. The last thing we’ll—I’ll say, and just looking at questions in the chat—we actually very early on shared a map with all of the states on disadvantaged communities, you know, as it pertains to the Department of Energy, Department of Transportation world. And there’s a striking correlation, I think, with a lot of the highway corridors we’re going to be focused on. So I think we’re really looking forward to seeing these communities get engaged in the program and the process going forward, and continuing to emphasize that in the out-years as well. CREBO-REDIKER: Well, I think those are great—that’s a great platform to launch into the Q&A, that we have—we have quite a robust number of questions that have popped up, and we also have hands up. If you—if you have your hand up, I’m just going to ask for your—if you can start with your affiliation. And the first question will go to John Jaszewski. I think you’re on—you’re on mute still. All right. While we get John off mute, I’m going to—oh, there he goes. Go ahead. Over to you. Q: OK. I’m John from—(inaudible, technical difficulties). I’m a city council member. I’m curious as to what kind of—(inaudible, technical difficulties)—for municipalities and school districts. CREBO-REDIKER: So if I understood your question, what programs are available to municipalities and school districts? Was that your question? Q: Rather—(inaudible, technical difficulties). Here in—(inaudible, technical difficulties)—school district and a city—(inaudible, technical difficulties)—separate organization. So what I’m wondering is, do we—(inaudible, technical difficulties)—for cities? Does that make sense? MOLTZEN: I didn’t quite hear the question. CREBO-REDIKER: Yeah, you’re—we haven’t heard—you’re sort of coming in and out, cutting in and out. Q: Let me try one more time. CREBO-REDIKER: OK. Q: Programs for cities as—(inaudible, technical difficulties)—school districts—(inaudible, technical difficulties)—for these—(inaudible, technical difficulties). CREBO-REDIKER: Do either of you want to take a stab at that? MOLTZEN: I think it was not just school districts, but what might cities look for in terms of federal programs that could help in terms of transportation electrification. Q: That is correct, yes. MOLTZEN: Well, I will tell you there is one that’s on the horizon. It’s not in my group’s area of responsibility, but EPA through the Inflation Reduction Act has, I believe it’s $5 billion for a Climate Pollution Reduction Grant Program, which will be targeted to municipalities, cities, and states, and regions. So I would encourage you to take a look at that program on our website, Climate Pollution Reduction Grant Program, under the Inflation Reduction Act. It’s in the very early stages, so you’re just at the right time in terms of looking into that. CREBO-REDIKER: OK. I’m going to go to the first Q&A, state representative for Connecticut’s southeast corner, Representative Aundre Bumgardner. We have a question: City of Groton owns and operates a municipal public electric utility. Will public utilities be given priority in terms of IIJA/IRA funds for deploying EV infrastructure and grid integration? Will public utilities be given priority? SCHROEDER: I could maybe start. And maybe just to define public utility a little bit. There’s public utilities and then there’s municipal utilities, which is sounds like this is, right, where it’s actually owned and operated by the government. So I wouldn’t call it prioritization, but there are eligibilities that cities have that a private or investor-owned utility would not have. So I don’t know if you could necessarily call that prioritization, but potentially the direct access to funds as opposed to contracting. CREBO-REDIKER: Did that get to your question, hopefully? The next question is one directed at Mike. OK, that was a “yes, thank you.” Mike, how can EPA improve VMT reduction, micromobility and shared mobility versus just employing CAFÉ/ZEV standards to increase vehicle efficiency? Are there other statutes that—oh, it’s moving around—other statutes that can be employed to move those items forward for EPA? And that’s from Christian Noyce, who is a rates analyst with Minnesota Public Utilities Commission. MOLTZEN: That’s a great question and I’m happy to take it on. Right, so, you know, if we’re going to make the kind of progress that, as I touched on earlier, we really need to address all of our environmental challenges, climate change, as well as public health, you know, we have to use all the tools in the toolbox, so to speak. Among them are the very things that were just mentioned in that question, vehicle miles traveled reduction and other mobility options. We like to look at the activity as well as the technology, and not necessarily—well. There is a statute, it’s the Clean Air Act, that, you know, there’s a framework there for ensuring that states are making progress in lowering pollution to the point where air quality meets our standards for healthy air. And everybody wants that. And it’s a—it’s a vexing problem. And there are tools there that can help, including incentivizing and encouraging vehicle miles traveled reduction. You know, we have all kinds of ways to account for emissions from transportation. And a key variable there is how many miles do the vehicles travel? And there are public transit options and ride sharing that, you know, these are some of the things that—you know, we like to think of it as, you know, kind of a disruption in transportation that we knew for decades. And, you know, ridesharing and micromobility, like was mentioned there, those are all really fascinating ways that we can get at addressing this huge challenge. One of the—one of the things that my office has put in place, we piloted around the country and then we’ve made available guidance for it on our website, is something called the Transportation Efficiency Assessment Method. It’s a little wonky. TEAM, is the acronym. And it’s geared toward transportation planners and air quality planners as a way for them to, almost like a sketch model, figure out what might—what might I turn towards as an option to help me make progress toward climate goals and public health goals? And it can give states and municipalities the ability to quickly compare different options, like perhaps increasing subsidies for public transportation. What kind of greenhouse gas benefits might we see if we were to employ that in, say, southeastern Connecticut? And I believe Connecticut was one of our pilot areas that tried that tool out. So I would encourage you to check that out on our website. I’ll try and grab a link and drop it into the chat. CREBO-REDIKER: Next question. And I don’t know where Deputy Chief Joe Garcia is from, but it’s a good question for everybody: Are there plans to fund infrastructure for the police fleet charging? SCHROEDER: That’s a fun one. I’ve seen and heard some great stories about electric vehicles and police fleets. And so I think certainly to the extent that there is public charging available for police fleets, that would qualify under the bill programs. So the $7.5 billion I referenced earlier is really for public charging. I can’t speak to how every police fleet charges. Sometimes—or, it feels, I guess, sometimes it might be behind the fence. There is not specific funding that I’m aware of or that working on to support that behind-the-fence charging. But I think in general, we hope everyone will benefit from those public charging networks. CREBO-REDIKER: I guess that can be for the next Infrastructure Investment and Jobs Act, deployment. One question from Christopher Kohr from Leesburg, Virginia. Is there any consideration for application deadline extension this year? Many jurisdictions have determined that the May deadline is not something they can meet given the requirements of the application. Any flexibility on timeline? SCHROEDER: Do we know if that’s directed towards Mike or myself? CREBO-REDIKER: So I think if there is a May deadline coming up with one of your programs, then that would probably be what is referred to. SCHROEDER: I know we have one, Mike, so I’ll jump—do you have a May deadline? MOLTZEN: No, we’ve got an April deadline for selected rebates winners. SCHROEDER: All right. I will—and I just wanted to confirm the question. So the community charging—the Charging and Fueling Infrastructure Grant Program has a May 30 deadline. I don’t think there is any conversations about extending that at this point. What I will say, though, this is year one. So this is a five-year program. So the announcement that came out a couple weeks ago was really for FY ’22, FY ’23 funds. So I think we fully expect there will be a future pass and future opportunity here. As well as additional opportunities, I should say. So this isn’t the only game in town. CREBO-REDIKER: So this is going to be deployed over the next five years? SCHROEDER: The bill funding essentially is allocated over a five-year time period. CREBO-REDIKER: OK. But you’re front-loading right now. So it would be better to do sooner rather than later? SCHROEDER: I wouldn’t say front-loading it. I think just the money was available when the bill passed, and when the program was stood up there was essentially two years of funding available. And we do want to—we want to get chargers out there, I think to go back to your very first question, to lead us off. CREBO-REDIKER: OK. Wayne Domke, who is a trustee from the Village of Roselle in Illinois: We currently get taxes for roads by the gas tax. If we have—if so, will we be able to tax electric for road repairs? Otherwise, what are other options? I think that’s sort of a broader question about how we think about funding roads and bridge infrastructure moving forward. MOLTZEN: I can’t speak to that. I do know that some—I’ve heard that some states and municipalities are looking at taxing electric vehicles for that purpose, because of the expected or suggested loss in tax revenue from lack of gasolines sales for those vehicles. But I can’t speak to that. It’s nothing that our office works on. CREBO-REDIKER: Alex? SCHROEDER: In the same, I would have to defer to my Federal Highway Administration colleagues. I would, maybe to pick up on Mike’s point, when I worked in the State of Colorado, there was—it was essentially a decal program, where it wasn’t a per gallon tax but there was a use fee that went into both road infrastructure as well as charging infrastructure. So there is a number of approaches, I think, at the state level that are really trying to figure out the broader question. It’s not just electric vehicles. It’s how do we fund our transportation infrastructure. CREBO-REDIKER: Yeah. And, you know, otherwise petition Congress, because they’re sort of—(laughs)—they’re the ones that have that tie to the gas tax. We have Minh Le from L.A. County: Can you speak about how concerned you are about grid hosting capacity and the integration challenges in regions of high EV penetration? California is, obviously, you know, the top in EV penetration. Velocity of grid infrastructure upgrades is limited by supply chain availability and lead times of major electrical equipment, such as large transformers. So if you’re—if you’re waiting on the grid infrastructure upgrade, how do you—how concerned are you about the hosting capacity for EV chargers? SCHROEDER: Well, there’s a couple, I think, separate but related issues there. I think the hosting capacity is really the robustness of our distribution network, which is really what gets taxed when you’re increasing the electric load in a certain area. I wouldn’t say concerned, but I think we need to be aware of this. I think we have seen really a clustering effect of charging. So certain locations, certain neighborhoods. I know utilities are thinking about this as well. So it’s definitely something that is front-of-mind for us in the Joint Office, and really kind of being the nexus of DOE and DOT, to make sure that we are stepping up to meet demand. I think directly in our programs, you know, we are accommodating things like onsite storage and generation. Batteries can be a great buffer during times of peak demand, and can also feed energy back to the grid. And I think that’s probably an overall theme that we’re seeing with our electric grid. It’s getting and needs to be a lot more flexible to meet some of these loads. And transportation is certainly a bit of a different beast than your washer/dryer/refrigerator, other appliances or things that might draw electricity. The supply chain question I think is maybe more directed towards how quickly we can do that. And I certainly will not paint over that there are challenges in supply chains, specifically with transformers. President Biden actually invoked the Defense Production Act to really try to shake that free. You know, I think the other way to think about that, one of the reasons we need more transformers is we’re seeing a lot more demand for EV chargers, for wind, for solar. And I think it’s—quite frankly, it is an outcome of our grid being a lot more flexible, is you need fewer, smaller assets, rather than more larger assets, if that makes sense. CREBO-REDIKER: OK, I’m going to go to a hand raised. Meredith Martino, if you could state your affiliation, and over to you. Q: Hi. This is Meredith Martino with women in Government. Mike, hi. This is Meredith, formerly from AAPA. So it’s nice to see you. I work with an organization now that supports women state legislators. And so I’m curious about what state legislators can do to help support the EV network, right? Because a lot of the formula funding is going to flow straight to state DOTs. And it’s not necessarily—there’s not necessarily a role for the legislature. So is it—is it really just a matter of, you know, appropriating state matching funds or, you know, something equivalent to that? Or are there actual policies that need to be put in place, or, you know, state laws that need to be written or amended in order to accelerate the deployment of EV charging? Thanks. MOLTZEN: I think—I don’t want Alex to have answer all the tough questions. Not that that’s necessarily a tough one. And it’s great to see you again, Meredith. I think you kind of hit the nail on the head one of your suggestions. And that is, you know, state-supported match funding for—to match federal funding is a great idea. There’s, you know, inevitably going to be a gap in what the federal government can provide in terms of funding. We’re throwing around big numbers here, billions of dollars, but it only goes so far. We know it’s not going to be enough to transform the entire transportation system vehicles. So, you know, we are—and this is, you know, one of the many aspects of how we’re trying to help people that are interested is helping them find local sources and state sources of funding. So if a state can do that, you know, that’s, I think, the epitome of collaborative government between federal, state, and local levels. But Alex may have a different thought or another thought. SCHROEDER: No, I think that’s a great—absolutely. Maybe a couple other things to even tie back to the last question. Utility regulation often sits at the state level. And every legislature has a different role in that, right? But certainly, there’s a lot that needs to be done there to prepare for an electrified transportation future. But again, this kind of more flexible energy and electricity system—and that goes, again, beyond EVs—I would throw that out there. And I think there’s also a lot of complementary policies at the state level. There’s incentives at the state level. There’s a number of states that are—quite frankly, have been building out charging infrastructure for a decade. So I do think there is a lot that can be done at the state level. There is a—it’s called the Alternative Fuel Data Center, but it’s essentially there’s an inventory of state policies that are really intended to support and promote transportation electrification. I would maybe point you towards that as a good resource for ideas. But I think there’s a ton that can be done at the state level. MOLTZEN: And I’ll throw one more out there, and that is—that’s definitely, I think, in that category. And that’s providing training and workforce development. That could be something too that state legislators might tackle, that is a critical need if we’re going to be successful in doing what we want to do with the transportation electrification. Q: Great. Thank you so much. CREBO-REDIKER: We have one question from Arno Zegerman, who is a council member in Apex Town, North Carolina. And the answer is, can you post these websites in the chat, please? And I think I’ll—we’ll put our heads together with Irina afterwards, and maybe send out—blast out an email with the websites with the relevant information so that everybody has it, doesn’t have to scribble it down from the chat. So, yes. And then we have, from Christopher Kohr, who’s deputy director of the town of Leesburg, Virginia: What defines a disadvantaged community? MOLTZEN: That is a great question, and it’s one that, you know, the federal government, anyways, is putting a lot of time and effort into figuring out. The White House’s Council for Environmental Quality established a tool for helping to map where these disadvantaged communities are located across the country. I’ll reiterate, you know, from EPA’s perspective and the context of the Clean School Bus Program, you know, we were, I guess, beneficial in part because we got some pretty clear statutory direction. So our consideration of what is the definition of a disadvantaged community came, in part, from Congress. And we also, you know, put a lot of time and effort into thinking of it. And for the Clean School Bus Program, it, as I mentioned earlier, school districts that have 20 percent or more students living in poverty is how we’ve defined a disadvantaged community or an eligible entity that is a disadvantaged community. And that determination is based on school districts listed in the Small Area Income and Poverty Estimates, or SAIPE, as we’ve come to know it, that we get from the Department of Education. CREBO-REDIKER: So he had a follow-on question, do jurisdictions have to submit financial information? So is there a threshold that would disqualify a jurisdiction? Is there a revenue threshold per citizen? And how would—and you just answered part of, what is it based on. But just looking, if you’re—if you’re eager to participate and receive funding for both of these programs, is there a revenue threshold? MOLTZEN: Well, I would say no. I mean, and I should clarify, these are not the only entities that we are awarding funding to. We’ve prioritized them for, I think, good reasons. But, you know, the—our programs are intended to benefit the entire country. And for sure, you know, again, if we’re going to make the kind of progress that we need to make to address climate change, we need to see this kind of transformation occur everywhere. So those are the ones that are prioritized, but we’ve given rebates to entities in all fifty states, as well as several of the U.S. territories. So we’re really pleased with the first offering for the school bus program, and we’re looking to make more progress with our grant program. CREBO-REDIKER: We have a question from—I think a call from Jeanette Sidebottom, who is Nelson County, Kentucky clerk—county clerk. A raised hand in the participant list. So please, over to you, Jeanette. I think you’re—are you still on mute? OPERATOR: Looks like we’re experiencing some technical difficulties with Jeanette. CREBO-REDIKER: OK. All right. Well, let’s go—we have one question from Jessica Hannah: How many level-two charging ports will be at each station? SCHROEDER: That’s a good question. I don’t have a great answer for that. And maybe just to provide a little bit of background, there’s typically two types of public charging that’s available. Level two and DC fast charging. And level two is, just from a—that’s like your dryer, in terms of electrical output. A DC fast charger is much more of a commercial operation. So that’s more of your gas station experience, whereas a level-two charger would be more like what you would do in your garage, or at a shopping center, et cetera. That’s going to be site-dependent, I think, and really vary across the country. You see some places with a bank of, like, fifty level-two fast chargers. You’ll see other places, like rec centers that just have two. So it’s really going to vary locationally. And that’s, again, kind of one of the things that we’re providing from a technical assistance standpoint, just helping people think about what that demand looks like and whether it’s a better application for level two or DC fast charging. So probably not an entirely satisfying answer. I hope the answer is enough for you to plug in, right? I think that’s, quite frankly, what we need to work towards. CREBO-REDIKER: We have a question from Josh Winkler. Can you speak to requirements or consideration for EV charging station accessibility for people with disabilities as part of this effort to expand the network? SCHROEDER: So the U.S. Access Board actually just published recommendations. And it’s on our website. I want to stop plugging websites, Heidi, if I can’t actually put them in the chat. CREBO-REDIKER: We’re going to collect them all and just blast them out at the end. So don’t worry. SCHROEDER: All right. But really a great resource for thinking about the accessibility question, which is certainly front of line, again, in terms of equity, in making sure that there’s charging stations available for use by everyone. I think it’ll probably look slightly different for different applications, right? So I don’t want to speak to what that might look like for school buses. But, again, the access port is a great resource. And their guidance is posted on our website. CREBO-REDIKER: So I think just to repeat, Tommy Moore, who’s the mayor of Gainesville, Texas. How do municipalities or cities apply for funds to build this infrastructure? Do we go to the state? Do they need to come through you for the grants or do they need to go to the state for the formula? SCHROEDER: The answer is, “yes.” So if they want to work on the formula program, that goes through the state. If they want to apply for a grant, if they’re an eligible entity, then they would apply directly to the Federal Highway Administration. And we would encourage both of those. And maybe just a—I think something for everyone on this call, really trying to encourage that state-local coordination here. If we’re going to have a national network, it needs to flow from the national to the community level. So those connections are really important. So would definitely encourage that kind of outreach, if it hasn’t happened already. CREBO-REDIKER: And a great question. Harry Browne, who is the commissioner of Grant County, New Mexico: Should a county containing no interstate highway bother applying for EV charger funding? We have U.S. highways, but no interstate. SCHROEDER: Yeah, actually, the designated corridors include both. It’s not just the interstates. Its U.S. highways. It’s really up to NPOs and states to nominate those corridors. So we would absolutely encourage that. And also, again, there’s the corridor piece, the highway piece, but also community charging as well. And I can’t emphasize enough how important that is to the national network. So I would absolutely say yes. CREBO-REDIKER: Definitely apply. OK, good. Are we—do have the phone—the phone working now, so we can get Mavis Bates, who’s a board member, Kane County. I believe that’s Illinois. Q: Hello. This is Mavis Bates from Kane County, Illinois. We had a meeting on this yesterday. I’m a member of the Kane County Board and also the chairman of our Energy and Environmental Committee. So we had a meeting yesterday with our Department of Transportation, hoping to apply for this. I agree that the date has come quickly, and we will probably have to wait for the next round. But are there any funds for planning, such as help in filling out the application, understanding our traffic patterns, gaining community input, and determining our needs, such as how many chargers, what kind, where, and who to serve? And how to—also, do we need to gain access to the locations for the chargers before we apply? CREBO-REDIKER: Good questions. SCHROEDER: So, not to sound like a broken record, we’re happy—driveelectric.gov—to provide that technical assistance. If you have questions, I think it’s a deeper dive. Certainly, that’s the right place to get started. And in terms of planning assistance, that is an eligible expense in the NEVI Program. It’s really, again, at the state DOT level. Stay tuned on that, though, because I think that’s something that we’re actively working on. I can’t share today, unfortunately, the details on that, but really looking to provide a bit more targeted assistance to communities and others that are asking the very questions that you’re putting in front of us. So maybe, Heidi, by the next one of these we’ll have a better answer there. CREBO-REDIKER: Well, don’t feel bad in terms of the—just the EV infrastructure. Because this has been a consistent theme of all of these webinars. You have a lot of places that don’t have the capacity or understand how to fill these forms out. And you really don’t want to—you don’t want to lose—you don’t want to lose those particular applications. One more. I think we have time for Michael Mozer, New Hampshire DOT: If projects are selected in year one, will they automatically roll over to the next fiscal year? Or do we need to have a separate application to be required to utilize funds in the next year as well? SCHROEDER: So I think that’s going to be dependent on your agreement. Typically, you know, when you’re awarded funds there’s a period of performance. And it doesn’t necessarily correspond to the budget fiscal year that the funds are awarded. So it’s going to be a case-by-case basis, I think, to give a blanket answer. But typically, the period of performance extends beyond the period of the funding announcement. I don’t know if that totally answers the question, but. CREBO-REDIKER: Well, we have—we literally are at the—at the witching hour. And we have so many questions in the Q&A, and a lot of hands up. I am wondering, Irina, if we can maybe capture these questions that were left unanswered and maybe send them to our wonderful speakers to see if maybe we can get some answers back to the folks who didn’t get their questions answered? Because I think this is a—it’s a pretty unique forum but we only have one hour. And this is the time where, you know, CFR’s pretty religious on, like, starting on time, ending on time. So I’d love to leave with—any final words from the two of you on what—how to interact with you, and what to look for in the coming year? From both of your departments. MOLTZEN: I’ll just jump in and say, I would encourage the participants on this webinar to make a regular habit of checking EPA’s website. Inflation Reduction Act programs are here and coming. I dropped another link to the chat, and we’ll add it to the blast that goes out for EPA’s Climate Pollution Reduction Grant Program. I had that in mind when the participant from Kane County came on, as a resource for helping state and local governments plan for climate programs, which very much should include electrification of transportation. CREBO-REDIKER: Alex, last word? SCHROEDER: Yeah. I mean, just thank the Council on Foreign Relations for pulling this together. This is a really important forum. And I think there is no mix of stakeholders that is the wrong mix of stakeholders. This transformation is going to impact all of us. And I think that last question about just capacity to deliver is huge. So the chance to have these dialogues, and hear from all of you, and have this exchange, hopefully these programs improve over time. I honestly think that’s one of the most exciting things about this. A number of programs in the bill, they’re multiyear programs. We’re going to learn as we go. They’re going to get better. They’re going to adapt to the market, and technology, and feedback from all of you. So please keep the questions coming, keep the dialogue going. And, but again, just double down on that—the state, local, community engagement. All of these ideas really need to be embraced at the community and local level if it’s ever going to work nationally. So, again, appreciate the Council on Foreign Relations realizing that, as an organization that has a global reach and global focus, to bring local leaders together, I couldn’t think of a better way to demonstrate the importance of that. So, again, really appreciate the opportunity to be here. CREBO-REDIKER: Well, I thank both of you. I thank everybody who joined us today. Great questions. This could have gone on for a very long time. And I’m looking at the long list of questions to go. Irina, thank you so much for gathering such an amazing group on this webinar. And join us next time when we do our next Infrastructure Investment and Jobs Act teach-in and webinar. Thank you so much for joining us today. FASKIANOS: And as we mentioned before, we will get from both Alex and Mike the list of resources, websites. We will compile those and send them out to all of you. And I will—we will download the questions and share them with you, Mike and Alex, so you can take a look and see if you can address specific questions that came in. Again, sorry we couldn’t get to them all. But we appreciate you all being with us. And please, again, come to CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for more expertise and analysis. And do email us, [email protected], for any ideas or feedback you want to give us, or ideas on how we can support the important work that you are doing in your communities. So, again, thank you all for today’s conversation. (END)
  • Democracy
    Civic Responsibilities With CFR President Richard Haass
    CFR President Richard Haass leads a conversation on expanding the idea of citizenship and ensuring the survival of American democracy. His new book, The Bill of Obligations: Ten Habits of Good Citizens, is a guide for elected officials, government staffers, and their constituents across the political spectrum to heal divisions and safeguard our country’s future.  TRANSCRIPT FASKIANOS: Welcome to the Council on Foreign Relations State and Local Officials Webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. We are delighted to have participants from forty-eight U.S. states and territories with us for today’s discussion, which is on the record. CFR is an independent and nonpartisan membership organization, think tank, publisher, and educational institution focusing on U.S. domestic and foreign policy. CFR is also the publisher of Foreign Affairs magazine. As always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on domestic and international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. We are pleased to have CFR President Richard Haass with us to discuss citizenship, civic responsibilities, and how to protect the future of American democracy. You have his full bio, so I will be brief. Dr. Haass is in his twentieth year as president of CFR. He has served as special assistant and senior Middle East advisor to President George H.W. Bush, and held various positions in the Defense and State Departments during the Carter and Reagan administrations. He is the author or editor of fourteen books on U.S. foreign policy, one book on management, and his most recent book on American democracy entitled The Bill of Obligations: Ten Habits for Good Citizens. Richard, thanks for being with us. Thank you for creating this initiative for state and local officials. If you could begin by giving us an overview of your book and more specifically why the focus on obligations rather than our rights. HAASS: Well, first of all, Irina, I’d like to know what are the two states not represented in this call. Clearly, you’re not doing your job. That’s very upsetting. Second of all, I want to thank everybody for what they do day in, day out. I’m a great believer in public service. I worked on the Hill and I was lucky enough for work to work for four different presidents. I also have some sense of what public service demands and requires. So thank you, again, for what you are doing, and thank you for giving us this hour here today. I wrote this book about democracy, putting obligations at the center. Just want to clarify for the record it doesn’t mean I’m not concerned with rights; of course I am. Rights are central to the American experiment. Indeed, as I expect all of you know, we only got the Constitution ratified when the Bill of Rights was added. Several states conditioned their ratification of the proposed Constitution on the adoption of a Bill of Rights. The reason is the entire context was still, you know, the breakaway from Britain, I mean, was still fresh in people’s minds, and the contrast between the totally or woefully inadequate Articles of Confederation and the new Constitution was great. And quite a few people were worried that the contrast was too great and we were creating too powerful a federal government, too powerful of an executive. Hence, the emphasis on rights. And again, rights and freedoms are fundamental to this or any democracy. And, you know, again, just so you don’t think I’m not concerned about rights, you know, what Lincoln described as our unfinished work remains unfinished. The reality with rights doesn’t always match up, say, to the Declaration of Independence—which, by the way, we celebrate the 250th anniversary of which in three years. But even if somehow we were able to close that gap and we no longer had any issues with—essentially, if Lincoln’s unfinished work were to become finished, it still wouldn’t be enough for American democracy. Think about it. You know, rights inevitably come into conflict with one another—a mother’s right to choose versus the rights of the unborn; someone’s rights to acquire arms under the Second Amendment versus someone else’s right to public safety; the right not to get immunized or wear a mask versus the right to health and so forth, public health. And so, again, rights alone do not provide the basis for a functioning government. Former Justice Breyer, Steve Breyer, wrote thoughtfully that the toughest cases and the most important cases that came before the Court—before the highest court—were not rights versus wrongs, but were rights versus rights. And when you have rights clashing, in the absence of compromise one of two things tends to happen. One is you either tend to have gridlock. You know, we’ve seen an awful lot of that. Or, worse yet, things have the potential to generate into violence, particularly if it becomes an all-or-nothing situation and the side that comes away with nothing, or comes away with what they believe to be too little, they then feel that the system doesn’t offer them enough and they’re prepared to go outside the system. And that’s the road to ruin and the road to violence. So I’ve argued for rights in two contexts. One is what we all owe one another and the other is what we all owe to this country—to the government and to the nation—as a way of not substituting for rights but complementing them, almost two sides of the citizenship coin. We need rights. We need obligations. And American democracy will only realize its potential if both sides of the coin are developed. FASKIANOS: Thank you, Richard. So we have a diverse group of state and local officials on this call. What role do they play in encouraging the kind of citizen participation that you put forward in your book? HAASS: Well, all of them—all of you directly or indirectly are where you are because of citizen participation. Either you were voted for directly or you were appointed by someone, I expect, who was. So participation is essential to democracy. Ideally, it will be informed participation. It was Ronald Reagan—I think it was his farewell address—who argued not simply for patriotism, but for informed patriotism, very much in this—in the tradition of Thomas Jefferson, who wanted informed citizens. And that would be the way to hold elected and appointed officials accountable. That would be the basis for people understanding when they were to exercise the right to vote how to exercise it in a way—in a manner that would be in the best interest of the country, as well as their ow personal best interest. So one thing I believe that people in public life have a right—I mean, have an obligation to do is to promote civic participation. We can talk about it in detail, but among other things the right to—the right to vote. I believe the right to vote should be readily exercisable. Obviously, there has to be integrity, but also I believe there has to—voting should not be, you know, made difficult with hurdles that are not, I believe, germane to the integrity of the—of the process. I think people in public life can model certain behaviors that are essential to a democracy. One is compromise, which is essential, as you all know better than I do, to get things done. Civility; people in public life can model civility. It also turns out to be pretty practical. Again, I feel a little bit like I’m preaching to the converted here. It’s taking those coals to Newcastle. But you know, the person you’re disagreeing with today—which is Thursday—on one issue might be the person you need to work with tomorrow on a totally separate issue. So civility—or—incivility tends not to be persuasive. Plus, it can—it can poison a relationship, so even when there is a potential for getting something done together that potential has been eliminated. I think people in public life have the obligation to reject violence for political ends. I think they have the obligation to respect norms. You know, one of the most fundamental is conceding when one loses an election, the so-called peaceful transfer of power. It’s at the core of the legitimacy of democratic systems. Again, you’re part of government service, so by doing what you’re doing you’re generating or modeling respect for working in government, which I think is wonderful. We’ll talk about it more, I expect. But particularly for those of you who have influence or oversight of public school education or public education at the higher level, I believe mandates for civics are vital if our democracy is to survive another 250 years. So I think you’re all in a—in a pivotal position to make an extraordinary difference when it comes to the trajectory of democracy in the United States. FASKIANOS: So, Richard, picking up on that point, you wrote this book because of—I don’t know if you’re still disclosing the school—the undergraduate who did not know anything. Why don’t you tell— HAASS: Irina, I want to interrupt you. You’re getting my books confused. That was the reason I wrote the last book, which was— FASKIANOS: Oh, that was the reason you wrote the last one. That’s right; I am. It’s been a long day. But if you could talk a little bit about why this is important because of the K through twelve curriculum and what—teaching civics. HAASS: Well, I’ll talk about it both K through twelve as well as higher ed. Americans are not born knowing about American history or American government or about democracy. Nobody is. So we have to teach it. We can’t just assume the transmission happens by itself genetically or simply because we somehow breathe it in. Doesn’t happen. And so we have got to make a conscious effort to transmit—to teach the narrative. I think it’s particularly important in the United States because unlike, say, Japan, which is a robust democracy, but Japan has a society which is homogenous in many ways. We are many things; we are not homogenous. I happen to think it’s one of our strengths. We’re a country of immigrants. We’re, in some ways, the most heterogenous democracy in the world when it comes to country of origin, when it comes to religion, when it comes to race, you name it. But as a result, those same features can become ways of pulling us apart. So, again, what brings us together is the idea of Americanness. And that was—that was central to the founding of this country—that this was a country founded on ideas, wasn’t founded on other attributes. So, again, it’s incumbent upon us to teach these ideas, to transmit this narrative. What’s so important about middle school and high school is it’s one of the very few things pretty much everyone in this country has to do, which is go to school through the age of 16. It could be public school, which is mostly is. It could be private school. It could be religious school. It could be homeschooling, what have you. But that’s our best opportunity to cast the widest net. And I believe that, you know, all of us would consider teaching young people how to read and count and think critically, how to access technology, get on the internet, and so forth, all that’s central. Why is this any less central? Why is it any less central to prepare people for their life to come as a—as a citizen? And so I would think that this ought to be required in all of our schools. It’s there for some. Usually it’s half a year, I don’t know, but you know, it’ll vary according to what state or city you’re from. Many states in the country it’s half a year, one or two it’s a full year, some nothing at all. And also, the content and quality of what is offered varies, shall we say, dramatically. It’s actually even worse, oddly enough, at the college and university level. I lost count; I think it’s about four thousand two- and four-year colleges in this country. Only a handful require that as a condition of graduation you take civics. Don’t get me wrong, virtually every university and college in the country offers civics or something close to it. But they’re not required. So depending upon the—how a student navigates his or her distribution requirements, they can easily graduate from school without having been exposed either to the basic documents, the basic history, or really any understanding. And I think it’s particularly critical there because, if you think about it, the average freshman’s eighteen. Well, they’ve got the right to vote already. They’re going to spend four years on campus and they’re going to be acting out politics on campus. And then they’re going to leave campus, and for the next however many years that they have in their lives they’re going to have the opportunity to vote. And again, we want them to vote and we want them to get informed as a runup to their voting. And civics, it seems to me, is part of that. When I say civics we can talk about the content, but it is history. And I more than understand how complicated that is, how politicized in some ways that’s gotten. There’s the basic documents I want people to be exposed to. There’s basic facts that are central to American history. And just to be clear, I don’t want to impose and I think it’s a mistake for anyone to impose a single interpretation of history on a young person. I think people ought to be exposed, again, to the basic documents, to the basic events and facts, and then they ought to be exposed to the serious representative schools of interpretation of that. I also think in this day and age we need to make information literacy part of this. New Jersey has done it. I’m hoping other states do it at the high school level. But we need to teach young people to become critical consumers of information. They’re being flooded. They’re being—and we live in this age of, if you will, unlimited information thanks to the Google machine and much else, but the problem is a lot of it’s misinformation. So how do students, how do they discern what’s a fact and what isn’t? How do they tell the difference between facts and opinions? How do they test what purports to be fact? What kind of behaviors—for example, I’m a big advocate of multi-sourcing information rather than single-sourcing. And so I think all this needs to be taught in our middle schools, obviously in our high schools, and at the college and university level. That’s the way we tool up Americans in order to fulfill the obligations of citizenship. And we just cannot assume it somehow happens otherwise. Indeed, we should assume it doesn’t happen otherwise. FASKIANOS: So your first obligation is to be informed. And Christina Jones, who is a councilmember in Raleigh, North Carolina, asks: How do you define “informed”? So if you can dig into that a little bit more, that would be great. HAASS: Actually, it’s a great question. It’s, obviously, subjective. But I would say, you know, inform—and it’s separate—it’s also separate from the question of how does one get informed. But I think what I would count as informed is I think people need to know something about American democracy, something about American history, how American government is structured, how it operates. So just kind of that’s the backdrop. We can—we can go into greater depth if people want. And then I also think being informed means understanding what the issues are and the consequences—you know, the choices and the consequences of those choices. So, to take an issue that Congress is going to have to take up in the not-too-distant future, something like the debt ceiling. And so the issue is, you know, what is the debt ceiling? What is Congress being asked to vote on? What happens if they—if they vote an increase in the—for the increase in the debt ceiling? What happens if they refuse to vote an increase in the debt ceiling? So that, to me, is an example of being informed about an issue. It doesn’t say which way to vote; I just want people to understand the choices, what is—what each choice holds within it. What are the—what are the consequences? What it involves. And then, hopefully, they can themselves make—reach an informed opinion and advocate for it or write their congressman or what have you about the way they would like that individual to vote. So I think there’s a combination in being informed—which is sort of understanding, if you will, the democratic basics in this country—and then one has to add to that a layer of being knowledgeable about some of the basic issues that are before us, be those issues domestic or international. And then the whole process of, you know, getting and staying informed. Again, some of the basics are a one-time thing to become, you know, familiar with them. You don’t have to read the Federalist Papers once a week and the rest, though every now and then a reading of the Constitution or the Declaration or Lincoln’s farewell address—I mean, Gettysburg Address and the rest is not a—not a bad thing to do. And by the way, if you’ve never read or haven’t read in a long time the Articles of Confederation, I recommend it. It really is a stunner. Out of all the things that surprised me in writing this book, the inadequacy of the Articles of Confederation I had forgotten. It’s quite stunning, quite stunning that anyone thought it could conceivably be a blueprint for anything other than total failure and inaction and, essentially, chaos. But I think there’s—again, you know, one needs to familiarize oneself with the basics, which is largely a one-time thing. I think then, again, one has to familiarize oneself with the issues, and I think there’s certain sources to go to. I’m not big on social media, just to be clear. Keyword there—the operative word—is “social.” That’s not—if it were serious media, it would be called “serious media.” So I think one has to go to serious media to get informed on the issues. I think it’s important to multi-source it rather than just put all your eggs in one basket. I think information literacy becomes part of it. So it’s not simple. It’s got a lot of dimensions to it. But again, it’s essential to fulfill—to check the box of being an informed patriot. HAASS: Irina, you’re on mute. FASKIANOS: We want to hear from you, your questions. There’s several now in the Q&A box, which I’ll read, but please we also hope that you will raise your hand. You can click the “raise hand” icon on your screen. You can, when I call on you, accept the unmute prompt and please state your name and affiliation. Of course, there’s also the written feature, too. Include your affiliation. And we like to have this be a best—a forum to share best practices, so please do that as well. So there is a written question from Hilary Ram: How do we inform citizens, indeed, but how do we do this with the death of local journalism? This seems to be our biggest challenge, getting the facts out to the public. And then there was a follow-on comment: Also, the term “journalist” has a wide range of definitions, so.  HAASS: Indeed it does. Look, I think you put your finger on one of the things that worries me, which is the shutting down of a lot of local news outlets. And you know, any number, of course, is largely economic, the breakdown of the advertising model. I understand. But it’s a real loss in this country. It’s a real loss because, you know, I grew up reading national papers but always reading a local paper, and it has a granularity that I think people—you know, I’m hoping some wealthy Americans decide that this is an area they could make a contribution in to sort of subsidize. I think that would be great. When people of means ask me what they can do, that’s always towards the top of my list. We actually do a program like this for local journalists where we try to beef up some of their access to information and analysis about the world on issues that might affect people in the area where they—where they publish. But it’s a real problem. You know, I don’t have great answers about what one does with the closing—you know, there’s still some papers. There’s still, you know, radio and so forth. But it’s a problem. And I think, you know, this issue of how we revive local media I think ought to get more attention than it does because there’s no way the big national media can do this, and they don’t. And it’s a real problem. And here I am in New York, which is not exactly a small town, and the coverage of New York City is really inadequate in the big papers. If you read—you know, I read among other things the New York Times and the Wall Street Journal, which are both published here, but there’s very little coverage with any depth about New York City. I don’t feel particularly well informed. And then so the question is, do I have to go to other, much more specific type of vehicles? And the answer is yes if I want to—if I want to—if I want to actually know what’s going on in the City Council or City Hall except for, you know, the very infrequent story usually written at 36,000 feet or about one particular issue. I would never get that from the major—the major outlets. So we pay a price here for not having really good local media or, you know, sufficient local media anymore. FASKIANOS: Thank you. Our next written question comes from Julia King and I don’t have her affiliation: This is an essential conversation. Do you have thoughts about how to have good-faith conversations around these challenging topics? It’s so easy to fall into angry discourse these days. And of course, we’ve seen the anger directed at election officials and school boards and those—and the like. So what can be done? HAASS: Well, again, I think, you know, I have several obligations that are relevant to that—things such as civility, commitment to nonviolence, and openness to compromise. And I call upon in the book religious authorities to use the authority of the pulpit. I’m not asking any minister or priest or rabbi or mullah or anybody else to take a stand on this or that policy issue, but this is—this is not policy to rule out political violence, to call for civility, to talk about being open to compromise. Who better than a religious figure and a religious authority could call for being sensitive to the common good? The last I checked, the notion of being one’s brothers’ and sisters’ keeper is rather basic to scripture. So religious authorities need to step up, I believe, and play a role here. I also think, you know, my hat goes off to a lot of these officials who are either getting verbally abused or in some cases physically threatened. I thought some of the secretaries of state who stood up through the electoral process a couple years ago, I talked about them in the book. That, to me, is a perfect example of putting the country before party or person. It’s the right thing to do. It’s not the easy thing to do. It’s anything but the easy thing to do. It’s courageous, it’s principled, and my hat goes off to them. So, again, you know, that’s the kind of behavior we need to see more. It’s the kind of behavior that John F. Kennedy wrote about in Profiles of Courage, people who did the right thing—in some cases compromised, in some cases refusing to compromise against all sorts of illegitimate pressures. But I don’t have any easy answers to you. Again, you know, this is a book where I write about obligations. And a lot of things won’t get better until more Americans get involved in the process of politics, and show up to vote in an informed way, and reward certain behaviors and penalize others. And all I can say is that that’s not hopeless because our elections in recent years, particularly national, have been sufficiently close—either the vote for—the electoral vote for president or the overall vote, say, for Congress—that actually a rather small number and percentage of Americans could have an outsized impact. So I don’t think this is in any way—in any way hopeless. FASKIANOS: Thank you. I’m going to go to Bryan Barbin, who has a raised hand. And please identify yourself once you unmute yourself. Q: My name is Bryan Barbin. I’m deputy secretary for taxation in Pennsylvania’s Department of Revenue. My question relates to compromise in your book. I thought your book had—I liked it because if you don’t have an opposite duty for every right, then the right is only as good as force allows. So it’s the duty that allows the rights to go to everybody. But my question on compromise is, we know that compromise is best understood by the most people if it’s explained, but what are your suggestions, basically, for someone in my position or in any state agency to do a better job of maybe explaining that compromises that happen happen because they’re the better alternative—either the better alternative short term or the better alternative to build on? But how do we go about doing that, educating on that? HAASS: It’s a great question. In my experience, it requires—you know, real estate has three laws: location, location, location. I think compromise has three words: either explanation, explanation, explanation; or, repetition, repetition, repetition. The more complex and more controversial something is, the more one has to talk about it before, during, and after the compromise becomes a fact. I remember when I—see, go back here now about thirty years, when I worked for President Bush the father. And when he announced—you know, he went from “read my lips: no new taxes” to, obviously, agreeing to tax increases as part of a compromise, and it hurt him badly politically. But I think one of the reasons it hurt him badly is he came from the school of thought which was just do the right thing and don’t worry, and I thought that’s inadequate. I think, yeah, it’s necessary to do the right thing, but particularly when it’s complicated and controversial. In this case, it was obviously controversial because he went against what he had promised. He needed to do a heavy, heavy amount of work of explanation, and he didn’t—gave one speech, wasn’t one of his best speeches to say the least, and that was it. And it just—you know, the lesson I took from that is there’s no—there’s no substitute for frequent education and explanation. I don’t—I think the good news is I’m not familiar with the Pennsylvania Department of Revenue, as best I know. If that changes, I’m sure you’ll be the first to let me know. But I watch what some of the state and city agencies do here. I’ve got—one of my kids works for the Department of Sanitation here in the city of New York and I see what they do on social media. It’s quite creative in terms of explaining certain policies, particularly where they’re innovating things like on composting. And they go to great length and so forth, and at least—so far, at least, they’re beating their metrics. And so to me, you know, you have to go think about all sorts of distribution systems, all sorts of social media, and so forth, as well as townhalls. I mean, different parts of the public, different age groups, people of different backgrounds absorb information different ways. For all I know, there’s a role for YouTube Shorts. I’m not a big fan of TikTok, but maybe YouTube Shorts. Or maybe there’s things on Facebook or Twitter or other social media. There’s, obviously, PSAs. But I would just think that finding all sorts of ways to reach people, doing the explanation. It’s not going to be perfect, but again, it certainly can’t hurt and it can help. And I don’t know, but that’s kind of where—but you know, I can hear in your voice a little bit of frustration, and I get it. As someone who tries to explain foreign policy issues and choices and compromises, it’s tough because it’s really—it’s not hard for those who oppose compromise, rather than characterize things, they caricature them or they make it sound so simple. Well, you know, and the word “compromise” has become something of a dirty word: Why did you sell out? Why didn’t you hold firm? And what you say is exactly the smart thing to say. Well, here were the—here were the real alternatives. You could have held out, but then this would have been the consequence. So compromise got me the best possible outcome that was available—not the best imaginable outcome, but the best available outcome. But it’s hard. And in an age of single-issue politics and social media, you’re going to get some heat. And I think all you—you know, that comes with the territory. And all you can do, again, is spend a lot of time explaining and repeating the explanation. FASKIANOS: So I’m just going to read a comment from Joseph Gacioch, who’s a city manager in Ferndale, Michigan: We will roll out our first community civics local government education program in the spring. Local government literacy is so important to civility and an informed community, and in local government our resources are waning every year. I like what you suggest and require civics as K through twelve. I posit state legislature should prioritize their budgets the same way and help fund experiential civics through the local government lens. Which I think is fascinating. HAASS: Love that. Look, could I just say something? FASKIANOS: Yes, absolutely. HAASS: It was Justice—it was Justice Brandeis, when he was on the Court, and one of my favorite phases—phrases of American political history is Brandeis’ phrase, which should appeal to all of you, as states as being the “laboratories of democracy.” The best ideas in the country tend to travel to Washington, and states become the place where, basically, you can test-drive ideas. And you can introduce programs at the state or local level—states, but essentially—and you can show it works. I love the idea, and I—of multiple boards of education, whether it’s statewide, citywide, what have you—countywide, what have you, experimenting here and trying various approaches, see how they work, talking to various experts. And I want to work with—I’ve already spoken to several governors about helping them develop programs both for civics and information literacy. But I think this is the way this is going to happen in this country. We’re going to show that certain things are really effective and popular and just good, and more and more—what I’m hoping is we create a kind of positive competition where people start saying: Hey, they got that at that school. They got that in that city, that state. Why don’t we have it here? So I think the idea that you all are going to innovate something on civics at the local level I think is fantastic. FASKIANOS: I’m going to go next to David Lovlien, who wrote a question but you’ve also raised your hand. So I think you should ask it yourself. And identify yourself, please. Q: Thank you, Dr. Haass, for being with us today. I appreciate and value your time. I am a first-time, 25-year-old county commissioner representing District 3 in Merrimack County, New Hampshire. I want to be a good leader for the people that I serve. Dr. Henry Kissinger has said America needs more serious leaders and that the quality of leaders in America has diminished over time. How can I be a more serious, high-quality political leader? Thank you. HAASS: Well, first of all, I appreciate the question coming from your since I’m married to someone who went to the University of New Hampshire. So I’ve got connections to your state. Look, I think the fact that you’re asking the question is—suggests to me that you’re already on your way. I’m a great believer that the best way to learn about leadership is through history and biography. My single favorite book for people in government is a book called Thinking in Time. It was written by two professors. I used to co-teach it with them years and years ago, a guy named Ernest May and another named Richard Neustadt. It’s called Thinking in Time and I think the subtitle is The Uses of History for Decision-Makers. Irina can circulate a link. But it’s the whole idea about how to use history to help guide you for decisions that you’re confronted with now. I’ve written a book called The Bureaucratic Entrepreneur, which again was designed to help people in the public sector make better decisions, and to implement them more efficiently and effectively. So I think there’s—you know, there’s literature out there, if you will—the Neustadt-May book, my book—which deals with almost mechanics and how to—the intellectual side of things. But I love the idea, essentially, of reading history and biography because—of people who faced the challenges of leadership, whether at the, you know, federal level, the state level. A lot of—even the corporate level. There’s a lot of—a lot of similarities. There’s a lot of good literature on decision-making and so forth. But that’s—and at some point, there’s no substitute for experience and learning from it. You know, you’re going to make mistakes, and the real thing is to set up, you know, mechanisms so you learn from them. And then, you know, I’m a great believer in not repeating mistakes. You will always make mistakes. I just want to be innovative and make new ones. I hate repeating the same ones. But, again, I can’t think of anything better than, you know, some of these books about leadership, particularly in the public sector. And then, you know, there’s just so much good—you know, the Doris Kearns Goodwins, the Michael Beschlosses, the Walter Isaacsons, the Jon Meachams. You know, we’re blessed in this country with some sensational historians and biographers. So I would—I would just—you know, almost any of the great names of American history, I would read some of those. FASKIANOS: Thank you. I’m going to take the next written question from Gail Patterson-Gladney, who is a councilmember in Poughkeepsie, New York: As a county commissioner, I would like to invite middle and high school students to attend county commissioners meetings. Besides reaching out to government teachers, do you have any suggestions on how to involve students in county government? HAASS: I love that idea. One of the things I recommend in The Bill of Obligations, I have a section on—the last section on the book is where to go for more, and I have all sorts of things to read and so forth. But the last bit is to get people to see government in action. You know, it could be as simple or not so simple as being on a jury. One thing I recommend to every young person and not so young person, if you’ve never done it in your life, is to attend the oral arguments at the Supreme Court. It’s an amazing experience. To see politics in action at the local level, the state level, the federal level, watching hearings. I mean, CSPAN’s OK, but it’s more fun to do it in person. You know, but I think—you know, to go to the National Archives. I love the idea where people can—it becomes a physical, if you will, experience. I think for the kind of thing you’re talking about—and, by the way, I know Poughkeepsie very well. I am at that train station with enormous frequency, since I have home not far from there. What I would recommend is creating arrangements with administrators or teachers for internship programs. You know, we have an internship program here, and we probably bring in, I don’t know, 125-130 interns a year at the Council on Foreign Relations. That’s a sensational program for getting people, you know, into the—for me—into the foreign policy, international world. They learn things, some of which are specific to that. Some of the things you learn are useful for any—for any job. And we have others—there’s other sorts of programs. There’s a program here called Global Kids for high school kids who—again, it’s like a three-week boot camp every summer which exposes them to international things. But I would have some kind of an arrangement with schools. Maybe they could get some—you know, a course credit or whatever it happens to be—for students to intern in various agencies or offices, or at a minimum, short of that, at least to see—to go see a hearing. Just to get a sense, and maybe spend a few hours getting a talk or two about how local government affects their lives. But I think—what I think is important for young people is to give them a sense that what government does matters. Also, to give them a sense that it’s a potential career path, that it’s something that they could do which would be really, really interesting and might make a—might make a difference.  But I would think some type of—creating those kinds of bridges, so to speak, whatever the word is—between local schools—you could also do it at the high school. I mean, at the college level near Poughkeepsie you got Bard, obviously, and some other schools. But some sort of program I think would be—you know, I think it’s a great part of a civic—it’s not a substitute for civics education, but it’s a component of a civics education. FASKIANOS: Thank you. I’m going to go next to Dennis Mandsager, who has a raised hand. Q: Can you hear me now? HAASS: Yes, sir. FASKIANOS: We can. Q: OK. Thank you, Dr. Haass. Much appreciate this event. I’m retired Navy, but I got this invitation because I’m on the Iowa Civil Rights Commission. And there’s been a flurry of bills that some organizations say are really targeting the LGBTQ community. For example, a proposed constitutional amendment to prohibit same-sex civil unions and marriages. There’s a proposal to eliminate gender identity as a protected class. There’s a bill that has passed both houses that says there’s no transition medical treatment available for anybody under the age of eighteen. There’s a bill that says your ID card must reflect your gender at birth.  And often, the people in favor of these bills use religion or the Bible as their primary argument. My church, for example, the Lutheran Church, says we should respect same-sex marriage, but we don’t have to honor them. And my church also supports statutes that prohibit discrimination against same-sex marriages and civil unions. But most of these bills are voted on along party lines. And you have referred to compromise a number of times today. How does a good Republican, a good Democrat, a good commissioner deal with this battle over gender identity and various LGBTQ+ issues? HAASS: It ain’t easy, because these issues, for some people, are seen as absolute for, you know, you mentioned religion or scripture. If people derive their position from scripture, or their interpretation of scripture, to be more accurate, there’s probably not a whole lot of give in it. And, you know, you mention the idea about transitioning not until the age of eighteen. Well, that, in some ways, represents a compromise. I’m not saying it’s right. I’m just saying that where one sets an age level. We’ve had it—you know, we’ve had compromises on abortion. You know, what’s—in terms of the timing of when abortions are allowed or not. We now see differences between and among the states. So even these totally—you know, some of the most difficult issues we find in our politics, there is an element of compromise there. But at the end of the day, these are issues that have been brought into the political space. I think it’s legitimate for them to be brought into the political space. Societies have the right to define themselves and to say certain types of behaviors are or are not permissible. That’s, in part, what defines societies. If these—whatever the standards are or whatever the rules are, we have ways through legislation they can be, in a sense, taken into the political marketplace. And we then have the courts, because courts can sometimes say that certain things are against other rights. And there is a struggle—there is a struggle there. For individuals who feel strongly on this side of an issue or the other, there’s political involvement. So for those who think certain things ought to happen, and those who think certain thoughts ought not to be allowed, that’s the political marketplace. And that’s where you organize, you support candidates who agree with you, you try to educate, your vote, what have you. So I don’t think we can ban these things. I’m not even sure we should ban these things from the political arena. In some cases, though, getting compromise is going to be brutally difficult. Again, I have no illusions here. I’m many things. Naïve is probably not among them. And no one has to treat them like any other political issue. And, you know, the iron law in American politics is what tends to prevail is not overall numbers but intensity. And those who fight for or against certain issues and bring to it great political intensity often have an outsized degree of influence or impact in the political space. And then, again, for those who don’t get the political outcome they want, then besides just the next election, then there are always options through taking cases to the courts. Q: Thank you very much. FASKIANOS: OK. Thank you. There is a comment—there are a lot of comments in the Q&A box. So you should—people should look at that. We will send out the list of the books that Richard has mentioned. So we will do that in the follow-up note, with the link to this event as well.  HAASS: Irina, can I mention something that we haven’t mentioned? FASKIANOS: Yes. Yes, please do. HAASS: Am I allowed to do that? FASKIANOS: Absolutely. HAASS: So we’ve talked about some of the things that can happen at the state and local level that can make a real difference. And I talked a lot about civics education. I’ve talked a lot about modeling certain behaviors. One thing I’d just like to throw out there is public service. That I’m a great believer in it. And the reason is clear. I think right now, in this country, this society is too divided. We don’t have a sufficient number of shared or common experiences. We’re too divided by geography, class, educational—levels of educational attainment, gender, race, religion, politics, what cable station we watch, what radio station we listen to.  And I think that is bad for the fabric of American society. I’m not saying everybody has to agree. That’s never going to happen. But I worry about the degree to which increasingly we don’t know a lot of our fellow citizens and we’re not used to interacting with them. We’re all living in our own, to use the phrase, ecosystems. And I don’t think that sets the stage for a functioning democracy. I think it sets the stage for—potentially for gridlock, or violence, or you name it.  So public service, it seems to me, is one of the ways we bring people together from different backgrounds who would otherwise not get together. And don’t get me wrong, I am not—repeat, not—advocating for anything mandatory at the state or federal level. I think that would be an error. But I think we ought to incentivize it. And I know California’s doing an awful lot. Maryland’s looking into it. But there’s an awful lot of progress. It needs to be incentivized, paying people for the work they do. It’s not going to make them rich. They’re not going to make Fortune’s, you know, wealthiest 100 list. But it’ll give them something. We can also condition loan guarantee forgiveness—student loan guarantee forgiveness—a degree of it can be conditioned on public service.  I think employers, like they now give certain preferences to veterans, might be persuaded to give certain preferences to people who perform certain types of public—same thing for universities. I can imagine admissions counselors would say if you’ve had one or two years of experience in a gap year working at whatever, we will consider that a major plus when we consider your application. I also think this kind of service, these government programs, might give some people an interaction with the government that’s more positive than they ever imagined. So I would just say—I would just urge people to think about it, in the context of your city or state, whether there’s a potential role greater than what you already have for various types of public service that would actually do good for communities or for certain objectives in your—in your city or state. But would do a lot—do a lot of good for the society and do a lot of good for individuals. This could be a great way to train them and so forth, to make them more attractive to future employers, or what have you. So it’s just one of the things we haven’t yet had a chance to do. But I think there’s a real opportunity at the state level. And this, to me, is not a Republican or Democrat thing. I think this is actually something that there ought to be a degree of bipartisanship on. And obviously there’ll be compromises to be made about what the incentives are and what sort of programs count as legitimate public service. Fair enough. So but I think it’s something worth pursuing. FASKIANOS: Thank you. Next question from Megan Huether has a raised hand. Q: Yes. Thank you for the opportunity. This has been wonderful. I serve on the Board of Aldermen in Manchester, Missouri, in the suburbs of St. Louis, where I hold a nonpartisan office. And what you’re saying, and the whole topic, is resonating with me. And I’ve really been spending a lot of time thinking about local governments and neighborhoods being kind of the unit of political change that can help us overcome this polarization and isolation that we have. You know, as leaders, you were talking about how can we be good leaders and encouraging civic participation, providing on-ramps for people to come in and get involved in their local government so that they experience that ownership and practice these obligations that you detail in your book. One of the experiences that I’m finding is that, you know, when I welcome people and encourage their participation, there’s a reluctance to participate because of concerns that I think are filtering down to the local nonpartisan level from higher levels of government, where they do not want to participate in the divisiveness. I’m wondering if you have, you know, reflected upon this problem, and how kind of that polarization is causing people really to not take part more civically. And if you have advice as we engage in those conversations, or inspirational examples of, you know, communities that have been able to overcome that. Thank you. HAASS: No, it’s a wonderful question with a lot of insight. And I think—first of all, I think you’re spot on. I think a lot of younger people who hopefully are idealistic—if you’re not idealistic when you’re young, when are you going to be—are turned off. And the word “politics” has become something pejorative in this country. Oh yeah, that’s just politics. And it’s seen as divisive, or unproductive, or ugly, or whatever. I don’t know a way to ban that, and that gets at a lot of my obligations. And those are behaviors, norms, and civility, and compromise. All I think you can do is two things. In our civics education, we can encourage certain behaviors. One of the things I like when we teach civics is to do things like debates or have mock Congress, mock city hall, mock state legislature, mock Supreme Court, whatever, mock constitutional convention, in ways that give students the chance to participate. And the teachers can step in and moderate, if you will, you know, blow the whistle, almost like a sporting match, and say: Hey, you know, John just said these things to Mary in the following way. Let’s just put aside the issue we’re debating. Let’s just talk about what just happened. So I think there’s things we can do if we structure the education so it’s not just about content but it’s about behaviors, it’s about tone, it’s about style, it’s about civility, and the rest, I think, would be one thing. And then, you know, you all are in positions. You run your office. You’re involved in a hearing or you’re involved in what have you. Well, again, you set an example every day by what you do and how you do it. And that, to me, is one of the most important things of leadership, is the example you set. Now, I deal with foreign policy all the time. And people say, how should the United States go about promoting democracy? And I say, oh that’s easy. I don’t need people from the State Department preaching it. I need people from the United States day-in, day-out, demonstrating that democracy delivers, that it’s an attractive form of government that makes people’s lives better. If we do that, people around the world will get the message loud and clear. If we fail to do that, they will basically say: Hey, this democracy ain’t so hot. We don’t need it here. And that’s why I think, you know, you all have a degree of influence over your immediate situations. And if you can make those, you know, better, and if you can find colleagues who you can work with across the political aisle, then it sends a powerful message that, you know, partisan differences are not insurmountable. FASKIANOS: I’m going to try to squeeze in one last question from Katherine Castrejon (sp). I might be mispronouncing that. And please be brief. Q: OK. Hi, everyone. My name is Katherine Castrejon. I work for a state senator here in California. I just wanted to ask, this is—like, politics have been very controversial in the past few years. And I believe that voters are hesitant in voting in these—in this time of year. So what would you recommend to, I guess, kind of help those younger voters to continue voting? Thank you. HAASS: Sure. Well, part of a civics course would be to show how voting matters, how small numbers can have unbelievably large impacts. If one looks at presidential elections, a couple of thousand votes in a couple of states has often swung—you know, made the differences. In congressional races, small numbers, again, can decide the difference not just in that race but in the overall balance in a state legislature or in the Congress at the federal level. And I would constantly remind people of how what government does, and how it does it matters. There’s almost no aspect of our life, for better or worse, that’s not affected by government. So I would want to basically get students—give students the appreciation that government matters. And even when you disagree with what it’s doing, that there’s ways of potentially weighing in or getting involved that would change it.  That it's not some impersonal, inanimate force. Or, in politics, there’s very—there’s almost nothing that’s inevitable or baked into the cake. And I want to give students the sense of possibility, that political involvement has with it the possibility of making a difference in good ways in their lives, and in their communities, and in the country. And basically saying, you should—you know, whether it’s limited to being an informed voter or you make a career choice to get involved in politics in whatever way, or at whatever level, or in public service whether it’s the military or law enforcement or what have you, that this can be a really important and satisfying—and satisfying path. So I think one just has to continue to reinforce the message of possibility. FASKIANOS: I am sorry that we could not get to all the questions, both raised hands and written questions. There were a lot of good resources shared in the comment section, which we will—we will pull together, aggregate for you all, and send out a link. Richard, thank you, again, for doing this with us. Thank you for this book, The Bill of Obligations, and all the others that you have written. Dr. Haass is on Twitter. You can follow him at @richardhaass. And you can subscribe to his weekly newsletter on Substack, Home and Away, by going to richardhass.substack.com.  You can also follow the State and Local Officials Initiative at @CFR_local. Please visit CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for more expertise and analysis. Again, we will circulate a link to the webinar and transcript, but you can also send us an email to [email protected] with any suggestions for future topics, speakers, and the like. We want to support the important work that you are doing in your communities. So again, Richard Haass, thank you for this. Thank you for the State and Local Officials Initiative. And thanks to all of you for taking the time today to be with us. HAASS: Thank you, all. Thank you, Irina. (END)  
  • Diplomacy and International Institutions
    Subnational Diplomacy With Ambassador Nina Hachigian
    Nina Hachigian, special representative for subnational diplomacy at the U.S. Department of State, and Alyssa Ayres, dean of the Elliot School of International Affairs at George Washington University and adjunct senior fellow at CFR, discuss the nexus of state and local agendas and U.S. foreign policy and how officials can become more engaged in international affairs. FASKIANOS: Welcome to the Council on Foreign Relations State and Local Officials Webinar Series. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. We are delighted to have participants from forty-seven states and U.S. territories with us today. Thank you for taking the time to join us for this discussion, which is on the record. CFR is an independent and nonpartisan membership organization, think tank, publisher, and educational institution focusing on U.S. foreign policy. CFR is also the publisher of Foreign Affairs magazine. As always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. We are pleased to have Nina Hachigian and Alyssa Ayres with us today to talk about subnational diplomacy. We’ve shared their bios with you so I will give you a few highlights. Ambassador Nina Hachigian is the first special representative for city and state diplomacy in the Office of Global Partnerships at the U.S. Department of State. Previously, she served as the first deputy mayor for international affairs for the city of Los Angeles and prior to that she served as the second U.S. ambassador to the Association of Southeast Asian Nations. Alyssa Ayres is currently serving as dean of the Elliott School of International Affairs at George Washington University. Dr. Ayres is also an adjunct senior fellow at CFR where her work primarily focuses on India and U.S. relations with South Asia, and in 2017 she authored a CFR policy innovation memorandum calling for a special office in the State Department to facilitate advisory support to international trade delegations, sister city linkages, and networks pursued by American cities and states, and we’ve shared that report with all of you in advance of this discussion. She also served in the State Department as deputy assistant secretary for South Asia. So, Alyssa, with that, I’m going to turn it over to you to begin the conversation and then we will turn to our group for their questions and comments. So, over to you. AYRES: Thank you, Irina, and what a timely conversation and there’s been so much interest in hearing today from Ambassador Hachigian. So why don’t we just dive right into it? Ambassador, I’d love if you could kick this off by sharing with the group here a little bit about the work that you’re currently doing to create this new office, this new office for city and state diplomacy. HACHIGIAN: It is so great to be here with so many city, county, state, and other local leaders. You’re my kind of people, always getting the job done. As you heard, you know, I spent five years until last fall working for a great mayor. So I know how terribly difficult your jobs are and the miracles you’re expected to perform and that they are often thankless. So let me just start by saying thank you for all that you do to help the American people, and I’d like to add a personal thanks to—I owe my job to the tenacity of mayors and others who lobbied to create this position and folks like Alyssa who helped. I want to thank CFR for this great platform and for Alyssa. She has the shared passion for this new area of diplomacy. We were together on a panel that she hosted a while back that I thought was really one of the best discussions I’ve ever had on the topic. So Mayor Garcetti really took a chance on me when he created the first Office of International Affairs and appointed me a deputy mayor in 2017. But I think that we proved over time with a great but small team that we could really deliver benefits for Angelenos like starting a free travel program for community college students, creating jobs through welcoming and leading trade delegations, and creating a vehicle for foreign direct investment, hosting a big summit with all that business it brought, and lots of constituent and diaspora services as well. Local leaders, you all on this call, bring better lives to your people and whether that’s fixing the roads or keeping them safe from extreme weather and violence, making sure they have good jobs, celebrating with them, and you know, because you’re on this call, that in 2023 much of this important work is connected to the rest of the globe. And part of the reason the State Department brought me on is because we work on the same transnational issues that you do, of climate change and cybersecurity, pandemics, but from another angle. So it made sense to connect the dots. Everything the State Department does it does with the security and prosperity of Americans in mind and my small but mighty new team are committed both to helping you deliver to your constituents and encouraging you to lead on the global stage. So we want to be your front door to the State Department. So we have three broad goals that we’re pursuing, and feel free to ask more on the specifics. I’ll just, you know, give you the big overview. But the first goal is to try to help bring the tangible benefits of foreign policy closer to the local level. So we want to help you connect with trade and investment opportunities. We have economic officers in nearly every country around the world willing to assist your communities to expand export and investment opportunities. Tell us if you have a business delegation that’s coming to visit and we can be sure that they don’t have any delays in getting their visas. Another benefit we can offer is to—is our opportunities for young people to get the global skills that they will need in a more competitive world. The State Department has a slew of programs that my team has already shared with mayors’ and governors’ offices to make these opportunities more accessible, and you can help us get the word out, especially to those in underserved communities who might not get to hear about them through regular channels. There are newer opportunities like the Gilman Program, which sponsor students of limited means to study or intern abroad. If you want to get on our mailing list just email [email protected]. All the department’s exchange programs are also at exchanges.state.gov. We want your young people out in the world representing the United States. The second goal of my team is to help encourage leaders like you to engage around the world. Some of you are already doing that. You’re meeting with diasporas about the problems in their countries of origin. You’re leading trade missions, signing declarations, meeting with heads of state, sharing ideas, and welcoming tourists and students and family from overseas. Some of you might already be involved in programs to help cities in other countries by providing advice or technical assistance and you’re helping to solve these global problems that affect your communities like climate change. Your work and commitment to that cause, to a lower carbon footprint, not only helps your residents in the form of lower air pollution and green jobs but it also helps us because when we as a nation meet our own commitments, and a lot of that comes down to your work, then the State Department negotiators have an easier time getting other countries to commit to their fair share of greenhouse gas reduction and that, in turn, means your people will face less extreme weather in the long run. So it’s two sides of the same coin and my team is now here to sort of draw those connections out. It’s similar with COVID, of course. We’re negotiating a global pandemic accord, which will help countries coordinate better to stop the spread of a future pandemic, and the team that’s doing that at the State Department really wants to hear from U.S. local leaders. So if you are willing to relive that horrible experience and want to share your knowledge that you’ve gained we would love for that to happen as well. So the third goal, in addition to trying to collect the benefits and supporting your global work, is to encourage the State Department in general to think and act with local leaders when it’s useful. We want our diplomats to consider how certain issues like climate change will always benefit from a local lens, and despite taking on these global challenges we know that compared to many of your foreign counterparts American localities don’t have the same capacity in terms of staff for global engagement and we are exploring various ways to help and we’ll keep you informed about that. We can talk more about that in the Q&A. But there are a few programs. We have a summit upcoming in Denver, this first ever Cities Summit of the Americas, and we can talk more about that. But we are going to be rolling out a program that will match U.S. cities and cities in—with counterparts in Latin America to share knowledge on sustainability initiatives. So that, in turn, will give the city—the U.S. cities a little bit of capacity to do that international engagement. And there are certain kinds of international engagement that don’t take very much time at all or resources but they can mean a lot. For example, signing the Mayors Declaration on Democracy is quite simple. It takes less than five minutes and—but hundreds of mayors have already joined it and as they do so they’re making a powerful statement on the strength of democracy and how it can start at the local level. So we can put that link in the chat or we’ll send it out afterwards, and if you’re a mayor’s team please consider signing it because we hope to make a—we’ll hope to do an event about it around the Summit of Democracies that’s coming up at the end of March. So we’re looking for more concrete support but what we can offer you now is advice and expertise and guidance if you want it. The State Department is full of amazing experts on every country and just about every issue. So if you want to understand our relationship with a place that you plan to visit or which is sending a delegation just let us know, and, in general, knowing when you travel overseas is useful to us. We can tell the embassy to look out for you. They might want to ask for a little bit of your time to talk to a local group and they’re very good at giving briefings to visiting officials about the country. So I understand well the capacity issue, having served in Mayor Garcetti’s office, but I want you to know that it’s very helpful to us when you do engage. When you’re carrying American values with you to other parts of the globe that’s all to the good. And I know it can come with some political risk because international endeavors are not yet seen as inherent responsibility of good local leaders. But, of course, I think that they are or should be and we’ll keep making that point wherever we can. So why don’t I—I think that’s a good general overview, Alyssa, and then we can talk about whatever else you’d like to. AYRES: No, that’s a terrific overview. Thank you for getting us started with that kind of broad sense of what you’re standing up. I would love to just follow up a little bit on two elements that you mentioned. One, you described, for example, with the upcoming Cities Summit of the Americas almost a matching function that will connect American cities with other cities across the hemisphere to share knowledge, and then you also described the office as providing like a coordinating function for cities or states that have activities of their own that they’re planning to undertake, whether it’s a delegation or receiving a delegation from another country. Are you finding that there is already more international activity than you could have ever imagined taking place or are you finding that there’s also a real scope to kind of help plus up and help our local levels do more? HACHIGIAN: It’s a really interesting question. So there’s—it’s both, actually. So and it’s a bit of a paradox because, on the one hand, our mayors and governors teams and counties and towns are much less resourced than—as I was saying, than their counterparts overseas. Just to give you an example, like, Warsaw that—in Poland has more people doing international—has twice as many as the largest American office in New York, more than twice as many staff that are focused on international relations and most places in the United States don’t have anyone. So we’re a huge country, though, so and we have a lot of cities and a lot of states. So, overall, there is a lot going on because there’s—you know, there are folks who are doing it. But there’s much, much, much more opportunity to expand for sure and move into different issues and do more technical assistance. And we’re—like, every day we’re talking to mayors and governors and other local leaders’ teams and speaking to associations of, like, secretaries of state and counties and so we’re already pretty busy. And then on the other side we get a lot of inquiries from our colleagues who want to connect for one reason or another with—you know, with localities in the U.S. On the Cities Summit that’s, you know, will be a way for local leaders—and it’s beyond mayors. It’s a cities summit but we’re inviting governors as well and others. To be able to do a lot of international business without leaving the United States because there’ll be hundreds of mayors there and some extremely high profile mayors from Latin America are coming and so it’s going to be a lot of fun. The secretary of state is also coming so—we expect to he will, anyway. And so it’s going to be a, I think, a way that for those—you know, for the cities who are already engaged, great, and they’ll, you know, meet counterparts that they’re maybe already connecting to or networks that they’re already a part of. But for those who haven’t, it’s kind of—it will be a way to do that pretty easily. And the program I just—that I described, you know, we’ll do some of that, but a lot of it was just going to happen organically the way it normally does with local leaders finding each other on the margins of, you know, different sessions on different issues that they’re passionate about. AYRES: I’d love to follow up on something else that I know we’ve talked about in another context when you were at the Elliot School talking about the state and local diplomacy initiatives, and you mentioned in your opening comments here how it can sometimes cause some risk for state and local officials to have international activities if it’s perceived that this may not necessarily be beneficial to their citizens. Can you talk more about how people can realize those benefits because it’s, obviously, an important part of making sure that—I mean, for those of us who are focused full time on international affairs it seems evident that international issues touch every part of our lives today. But I can see how the flip side it might be harder for somebody to see that if it’s not part of your daily life. HACHIGIAN: Yeah. I do hope that we—just the existence of my team and my unit and the focus of the State Department on foreign policy for middle class will give local leaders some political cover. You know, if we’re involved and we’re asking then that might help in terms of constituents who might be grumpy about it. And also mayors have described to me that, you know, if they’re out there on a trade mission, you know, bringing back jobs for the community or bringing companies to come invest in their community that, in turn, increases the tax base, which increases their ability to fill the potholes or, you know, get the best new fire truck or what have you. So it’s kind of—it can be a virtuous circle and I just think there are a lot of great solutions that other cities have tried and that we can bring home. So, for example, and I just know the Los Angeles cases the best. So we have bus rapid transit because of a city in Brazil that did it first and that we went to see, and so that kind of thing improves the lives of your residents and jobs as well, as I mentioned, and, you know, all the climate change work that, you know, everyone—a lot of cities around the world are doing and sharing lessons on the best way to do that. So a lot of that just requires that you’re engaging internationally and, you know, it takes a little time. It doesn’t happen overnight. But if you put a little time into it and it will, you know, very likely redound to concrete benefits in your community. AYRES: Let me follow up right away. You mentioned climate change and I think one of the great examples of really active city networks is the C40 cities and we see from there there’s other kinds of parallel organizations that have emerged, like the Strong Cities Network or the U20, for example. Can you talk a little bit about your new office and engagement with these other kinds of organizations and being a kind of contact point for our many local leaders who may want to plug in? HACHIGIAN: Yeah. Absolutely. Well, I can give you—anyway, they’re really important partners for us, all of them are, and we’re doing something a little experimental with the Cities Summit of the Americas where we’ve brought them all in to help co-create the actual, you know, sessions with us. So we have C40 and Strong City and CHANGE, which is a gender equity network, and many others that are helping to create the panels and the sessions and the—you know, the discussions that will happen at the Cities Summit because they’re the ones who are engaging with mayors every day and they’re the ones who know where the conversation is on these, you know, many different topics. So, yeah, on climate there’s C40. There’s ICLEI. There’s the Under2 Coalition that I recently was introduced to. They’ve worked at a state and regional level around the world and they’re critical. They’re absolutely critical networks that are doing some of this sharing back and forth and providing platforms for cities to share their solutions and learn from others about, you know, very specific technical stuff like, you know, where do you put your EV chargers, you know, how do you electrify your bus fleet, how do you get the purchasing power you need to show the transportation companies that you want electric buses, and sometimes cities have gathered together in coalitions to together make a purchase—that kind of a purchase. You know, how do you—like, how do you get green hydrogen? You know, where’s the technology going to come from? You know, how do you get to net zero on your grid? Anyway, there’s many, many, many. I could go on and on. You know, sanitation and how you reduce methane. Anyway, these are all, like, technical, you know, challenges. At the end of the day—we talk about them very abstractly a lot of times but at the end of the day, like, you know, stuff has to go into the ground or onto, you know, streetlamps or whatever. It has to actually physically manifest and that’s why, you know, the subnational work in this area in particular is so important because if you’re not engaging, you know, with cities and counties and regions then you’re—you know, you can talk a good game but you actually have to then do it to actually reduce the carbon. AYRES: Mmm hmm. Mmm hmm. Just speaking of the idea that the action where it takes place is at the local level, I’d love to hear about how your new office is engaging with the Sustainable Development Goals and, you know, there’s one level of engagement through the totally organic, voluntary local review process. There are many other mechanisms. Please share with us a little bit more about where this plays a role in the new special representative’s office. HACHIGIAN: Yeah. Well, we’re having conversations with our colleagues in the International Organizations part of the State Department known as IO. They’re the ones who deal with the U.N. and all its processes and they’re, you know, in charge of the United States’ Sustainable Development Goals. So we’ve been talking to them about the experiences we know at the local level where we have, you know, a bunch of cities and states that are—you know, are trying to measure their progress toward the Sustainable Development Goals, which, for those of you who don’t know, are these seventeen goals that the world agreed to, I think it was in 2015, that we wanted to reach by 2030. So everything under the sun from, you know, no hunger to life under water to biodiversity on land to climate change, and then there’s one on cities, you know, specifically. So it’s a really interesting exercise that we went through when I was deputy mayor and it allowed us to really have conversations with other cities around the world in a different kind of language because we don’t hear about them a lot in the United States. But the rest of the world is pretty engaged on the SDGs. So, anyway, it’s IO that will take the lead on that for the United States. But we are making sure that they, you know, have the resources that have already been created by subnational groups in the U.S. AYRES: And can you share with us what’s on the diplomatic calendar for your office coming up ahead? You must have a series of—you mentioned the Cities Summit of the Americas. There are all kinds of other gatherings, I’m sure, that you’re planning to attend and engage in. HACHIGIAN: Yeah. I can share the beginnings of it anyway. So I’m going to go to the Munich Security Conference, which—tomorrow, which is kind of the— AYRES: Oh, tomorrow. Yeah. (Laughter.) HACHIGIAN: It’s kind of the lollapalooza of, you know, defense people—(laughs)—and I’ve never been before so I’m excited. But I’m going to be on this amazing panel discussion with the mayor of Kyiv, mayor of Tokyo, Koike—Governor Koike—the mayor of Munich, and a very well-known/regarded writer, Anne Applebaum, and it’s being moderated by Dávid Korányi, who was one of the founders of the—well, he was an instigator, I would say, and a shaper of the Pact of Free Cities when he was an adviser to the mayor of Budapest, and that’s a—it’s a(n) organization that works on democracy and they’re the ones—I mentioned that Global Declaration on Democracy, which is based on a text that they wrote—the Pact of Free Cities did. So that’s Munich, and then I want to—anyway, there’s a whole bunch of engagement there. And then we have the Summit of Democracy at the end of March, which will be working on the—you know, the local leader element of that. Then we have the Cities Summit of the Americas, and I’m basically not thinking too much far past that. There will be plenty more things that are starting to come my way. But those are the ones I’m focused on for now. AYRES: It’s a pretty busy agenda for the next couple months at least. Well, I know we have some questions already in the Q&A. Irina, should we open it up now to the couple hundred people who are with us? FASKIANOS: Absolutely. Let’s go to the group now for your questions. As a reminder, we are on the record. To ask a question please click the raised hand icon on your screen. When you’re called upon accept the unmute prompt and please share your name, affiliation, followed by your question. You can also submit a written question in the Q&A feature in your Zoom window and I see that a few have done that. If you do choose to do that please share your affiliation as well. So I’m going to call on the first raised hand, Heidi Hall. Q: Thank you. Thank you for taking my question. My name is Heidi Hall. I’m a supervisor in the rural county of Nevada County in Northern California. It’s fascinating to hear how many issues, how many activities, you’ve got going on trying to connect with local leaders, which I deeply appreciate. You’ve mentioned cities and governors, and you have to know that in the rural areas the counties take on a lot of those roles that the cities would normally do. Will you include county commissioners and supervisors in these activities? Can we also be a part of these efforts and participate and is that, you know, something you can’t do because of the restrictions of the office or is it—was it just implied that county commissioners and supervisor(s) can be—and counties themselves could be included? Because it sounds wonderful. HACHIGIAN: Of course. Absolutely, and we’re already well in touch with the National Association of Counties and we’ve spoken with them and we’re speaking to their annual event and we a hundred percent want counties on board. The choice of the title was—is sort of a tricky one. We wanted it to be—so it began with subnational diplomacy and that title is maybe not as transparent as it could be. And so we are informally using city and state diplomacy just because it’s short and pithy but counties are a hundred percent invited to our activities, and rural counties as well and, you know, there are, I think, probably lots of opportunities for sharing information and practices between rural areas around the world and I consider them to be absolutely part of our mission as well. Q: Thank you. FASKIANOS: Thank you. I’m going to take the next question from Ahmad Zahra, who is a council member in Fullerton, California. I’m an immigrant from Syria currently serving my second term on Fullerton City Council. I appreciate this webinar. How do you envision working with local elected officials on relations in internationally troubled countries or regions? HACHIGIAN: Yeah. Thank you for that. Thank you for that question and, you know, so sorry for what—about—with the earthquake in Turkey and Syria. It’s really tragic. So I would say that at this point, you know, if there are—you know, we can do a variety of things. If there are cities or places that you want to, you know, connect with around the world that’s something that we can, potentially, facilitate. If there are—if there’s, you know, aid missions—I know that there are, you know, various aid organizations that are based in the United States that are working in Turkey, at least. I’m not sure about Syria. And we can also arrange briefings for you about what is—you know, what is going on, what our policies are, what we’re trying to get accomplished and that, I think, can be, you know, something that is informative then for your diaspora community if they’re asking you questions about, you know, the state of play. So those are a few ways off the top of my head that I can think about. FASKIANOS: Fantastic. Let’s go next to Jorge Maldonado. Q: Yes. Good afternoon. This is Jorge Maldonado from the city of Nogales, Arizona, down south of the border down here in—next to Mexico. I’ve lived in Mexico for fourteen years and have worked in Mexico for thirty-five years and a lot of times I see the collaboration with the other countries. We are not taking advantage of the people that have any relationship with the other country. Oh, by the way, I’m mayor of Nogales, Arizona, and I’d like to—you know, I’ve been mayor for a little bit over a month and I’d like to be acknowledged and be available for any support that—you know, that anybody would need with the relationships to Mexico. I know twenty-seven of the thirty states in Mexico and I think a lot of times talking and being part of the groups with people that know the country is helpful for everybody. So whatever I can help you and whatever I can learn from you, you know, in the summits I’m looking forward to being there. I would really appreciate all the help we could do and I know together we could do a lot more things. I appreciate this time and thank you for this conference. HACHIGIAN: Well, thank you and congratulations. I hope that you have a wonderful time as mayor. It’s a really tough job but a really great job from what I hear. And thank you for your offer of your expertise and for sure, like, this is—you know, part of the beauty of this office is we find out about folks like you who have, you know, deep connections and relationships. And, you know, I think—you know, I’ve talked to other, you know, border town mayors or near border town mayors who want to do more cooperation with their Mexican counterparts and I talked to one mayor who wasn’t sure what was allowed what’s not allowed. And, you know, that’s exactly the kind of thing that we are here to help—you know, to help, you know, talk through and figure out. So thank you, and really look forward to seeing you at the Cities Summit. I think there’ll be a, you know, a good group of Mexican mayors and governors who will be there. So thanks. FASKIANOS: Thank you. Well, I’ll take the next written question from Wayne Domke, who’s a trustee at the Roselle Village in Illinois, and this is more of a—it’s a comment and a question. And Roselle very active in the Sister Cities program. We have a Polish city, a German city of friendship, subpartnership. They’re close to a city in Sicily and have a very active group seeking a relationship with a city in India. All of this and they’re only a town of 23,000. What do you see is the value in the Sister Cities program that was begun by Dwight Eisenhower? HACHIGIAN: That’s amazing. Congratulations. You’re very active. (Laughs.) I think the Sister Cities program is great. I really do. I will admit that when I came into my job as deputy mayor I was a policy person and I wanted to do serious policy things. But, honestly, the Sister City relationships that we had provide that foundation, even if you want to do—you know, go beyond cultural activities and beyond exchanges to do—you know, in our case it was a clean port agreement with Nagoya, Japan. So I think that those longstanding ties are terrific and I encourage you to keep them up. You can think about whether there’s more that you want to do than what you’re already doing with those particular places. But all of that I really think helps the United States as a country as well. All those ties that tie us to the rest of the world is good for us also. So thank you, and I think it’s a terrific program. FASKIANOS: Alyssa, since they are seeking a relationship with the city in India do you have anything to add, given your time there and your expertise? AYRES: You know, one of the interesting things and one of the challenging things about forging local level relationships around the world is that not all cities or not all states have the same level of autonomy. So Indian cities do not have the same kind of autonomy you might expect from a U.S. city so that will be something that, perhaps, emerges as you’re looking to carry out, I don’t know, certain kinds of exchanges or conversations. But, for me, one of the most interesting things about seeing the rapid growth and interest in subnational or state and local diplomacy is the way that kind of broader organizations have formed to bring local levels of government together on an even platform as opposed to a point to point or a paired kind of relationship. And so that new formation is what’s really interesting about this moment and I would imagine that you’ll have contact with some other cities that may have similar partnerships that could offer kind of technical advice or perspective from things that they’ve experienced. FASKIANOS: Great. I’m going go next to Mayor Seren, raised hand. Q: Thank you. My name is Kahlil Seren, mayor of the city of Cleveland Heights just outside of Cleveland, Ohio. I am—you know, I’ve seen over the last year of being mayor—I’ve watched other mayors be criticized for a variety of activities—leaving their jurisdictions to go to conferences, to visit other jurisdictions to get insight into the challenges they face even within the United States. And so I’m wondering if you have heard this kind of criticism and how you advise mayors or other elected officials in dealing with that kind of criticism. You know, leaving your city, people think it’s a vacation. They don’t see the tangible results of the experience, and so I’m wondering how you justify that to people. HACHIGIAN: Yeah. It’s a good question and I’ve definitely heard this kind of thing. Well, I guess I have two reactions or two thoughts. One is usually it blows over fairly quickly because it’s not that interesting and also that, you know, I think constituents mostly know, you know, they’re the ones who elected you and elected their leaders and may, you know, have some bit of flexibility in their thinking about the mayor, you know, doing things for good reasons. The other thing I would say is that you can—you know, when we did international trips back when I was deputy mayor we made sure that there were really clear deliverables, at the end of the day, that there were jobs and agreements and, you know, promises for them to come to visit us and et cetera. So that’s another thing to do is just to—you know, just to be very clear about why and what you’re getting out of it. But I—you know, I hope over time that that changes because mayors’ work is international now. I mean, the COVID pandemic is—you know, there’s no better example than that. Climate change is another one and cybersecurity is another one and migration is another one. These are all international challenges that you have to deal with and, therefore, you know, the solution is in part an international one. FASKIANOS: Great. Thank you. I’m going to go next to Kathleen German, who is a community liaison to New York State Senator Harvey Epstein. How can New York State legislators become more engaged in international affairs? What office can be our point of contact if we’d like to seek guidance with international affairs in our districts such as asylum-seeking individuals? And a few others have asked that question, too, about point of contact. HACHIGIAN: Yeah. I mean, you’re welcome to contact us, [email protected], and if we’re not the right folks to handle it we can, you know, be the traffic cops to send your inquiries to the right place. So I think that’s the easiest answer. FASKIANOS: Great. I’m going to go next to a raised hand from Alberto Jaramillo. Q: Hello. My name is Alberto Jaramillo. I’m a council member for the city of Sunland Park. I represent District Number Four, and we are actually one of the border cities also here in the country. I want to—first off, I want to see if—this is the first time I’ve been invited to this type of a meeting, and I would like to see if I can actually get the recording because I know it’s being recorded. There is a lot of important information that I missed out. I was trying to take notes and I want to see that information. Also, some of the things that you mentioned like the fifteen goals, things of that sort, if you can also send some of that information to me. Also, the mayor from I think—I took a note here—the mayor from Nogales, I would like to see if I can get in touch with him so somehow if you can send me an email or can I send my number because I want to—since my first year, I wanted to go to Mexico, start this relationship between the two cities because it looks like we are—since we are so small—it’s only 17,000 people here according to our census so we are always, like, kind of, like, left out of this major cities for, like, you know, El Paso, Las Cruces, and Juarez. I wanted to start building a relationship between them, between the four cities. We are part of those—that circle. But I’d like to know how to start about having this relationship with our sister city, Juarez. FASKIANOS: Great, and—that’s great. We can follow up with you and, yes, we will be sending out the link to the video and transcript after this. HACHIGIAN: And if you have questions about Sister City stuff you can send those to us. FASKIANOS: Great. All right. That’s terrific. I’m going to go next to, let’s see, Mark Sharpton of Logan County, Oklahoma. Sorry, yes. Has a question. Can local officials negotiate and represent the U.S. and local government without the constitutional authority to do so—Article Two, Section Two? HACHIGIAN: So when I say represent I mean in an informal way, not with a—you know, not with the U.S. flag and the, you know, thing that, you know, that you would see at a diplomatic gathering. But the fact is students, you know, business people, and local leaders who are out, you know, in other countries are representing the U.S. in an informal way and it’s—you know, of course, the fact that the federal government has the authority to conduct foreign policy. But there’s been—and Alyssa should answer this—but there’s been a growing understanding that there are a lot of other actors that affect foreign policy even if they are not charged with making it and that includes businesses and it includes labor leaders and it includes, you know, tourists and local leaders. Alyssa will give you a better explanation than I just did. So but I did—but it’s a good question and I did—when I said represent I meant informally. AYRES: Just to note, briefly, I think, as the ambassador said, the engagement of state and local actors in international questions is not a shift in asking other actors to negotiate on behalf of the United States. That isn’t what seems to be happening and, as you note, the constitutional authority for the conduct of foreign policy resides with the federal government. What seems to be happening is more of a voluntary engagement and a sense of sharing best practices as ways to learn from and implement at the local level, and so that’s why you see the kinds of networks that have grown around topics and shared concerns. As the ambassador mentioned, the C40, again, focused on climate and sharing best practices. You could almost call it, like, a technical transfer of knowledge whether it’s infrastructure development or transportation or other ways of thinking about meeting the challenges that are before all state and local level officials. So, again, it isn’t that somebody is suddenly saying, please start negotiating this treaty. It isn’t that at all. It’s more of a voluntary engagement that brings people together to help learn from and bring best practices to their own locations. FASKIANOS: Thank you. I’m going to go next to Maria Tran, who has raised her hand. Q: Hi. My name is Maria Tran. I am a city council member. This is my first term. My question for you is regarding the Sister City program. Should we ignore the policy about woman rights, children’s rights, when we voting or consider for the applicant of a Sister City in the program? HACHIGIAN: That’s really up to you, I think. I don’t—what city are you from or place are you from? Q: Brooklyn Park. We have voting for that kind of program and other—you know, there is another different side opinion thing that we should skip that. I, myself, I think human right, children right, woman right, is in our policy—national policy and Constitution that we have to base on that in our decision-making. We cannot skip it. But other of my official colleague, somebody think that you can just skip it. HACHIGIAN: Yeah. I mean, my personal opinion is that it is important and those issues are important. But, you know, we—and we can, certainly, you know, have a longer conversation about, you know, which place and, you know, the relationships of the United States to that place. But that would be my—you know, when I was deputy mayor, like, that meant that was important to me, human rights and women’s rights, as you say, and individual rights, and I didn’t want to, you know, support another place that didn’t observe those things. But it can be a complicated question and it can be the case that a city is, depending on what country you’re in, you know, there’s a city that’s really trying to do the right thing even if the whole, you know, country isn’t. So it’s—it can be a tricky question. But, you know, you were elected to represent your people and if your people care about human rights and women’s rights then I think, you know, it makes sense to me to take that forward in your international engagements. FASKIANOS: I’m going to take the next written question from Jackie Gomez-Tejeda, who is in the office of Florida State Representative Rita Harris. What organizations can we work with to help survivors in Turkey/Syria? What would be a great next step for a local legislative office to take to offer some relief? HACHIGIAN: That’s a great question, and I know that there are international organizations that are—or I should say there are organizations in the United States that are organizing to collect relief. And so let me find out the right answer for you and I’ll ask CFR to send it in the email that they send out afterwards. FASKIANOS: Great. Thank you. Next question we will take written or raised hand from Chodri Khokhar. If you can accept the unmute and state your affiliation that would be great. OK. That’s not working. I want to—in the interest of time I’m going to go on to Darren Costa. There you go. Q: Hello. This is Chodri Khokhar, mayor of Glendale Heights, Illinois. FASKIANOS: OK. Q: I have one question. I’m from Pakistan and I want to have a sister city in Pakistan, number one. Number two, I want to help, you know, those—flood came, you know. And I want to also have some trade, you know, with Glendale Heights and Pakistan. How you can facilitate, you know, these goals? HACHIGIAN: Yeah. So on the sister cities question there’s an organization called Sister Cities International and they’re the ones who can, you know, advise you on how you establish a formal sister city agreement. But we can also connect you to the folks in the State Department who work on Pakistan to maybe advise on the city and maybe advise on how to help the flood victims. That’s terrific, and we can do that. So if you use that email I mentioned, [email protected] and write there what you would like to do then we can take it from there. FASKIANOS: Great. There’s a question from David Kim. I don’t know the affiliation. But will the Office of Subnational Diplomacy live past the Biden administration? Are you working with management to institutionalize the office as Secretary Clinton did with SGWI? HACHIGIAN: Yeah. I hope so. That’s the plan and, you know, we’ll just see what the next administration decides to do. But it’s definitely something that’s on our minds and, honestly, it’s local leaders that will be the ones to say, don’t take it away, and your voices will carry forward, I think, to keep it, you know, if we end up being useful to you. So, you know, I certainly hope so. FASKIANOS: Fantastic. I’m going to go next to Darren Costa. Q: Hi. Good afternoon. Thank you so much for presenting all this very useful information. I’m a councilor in a gateway city just outside of Boston, Massachusetts. So we have a large amount of immigration through the city. We’re a majority-minority city, a majority non-English speaking city, where I’ve found, as a counselor, is with outreach. Could you recommend any bodies of people that could help the city better engage and that feedback received can better reflect—thank you—what the—you know, the representation of the people? Because it seems like it’s a small community of people that tend to get involved with city services or tend to actually give feedback to the city. So are there any recommendations on how to get feedback and community involvement that mirrors more closely the community around us? HACHIGIAN: Yeah. That’s a really interesting question. My experience tells me that there tend to be organizations that are gathering those people and it could be—they could be religious. They could be, you know, other kinds—like other—like diaspora groups that are organizing to help folks back home or, you know, organizing for, you know, whatever in their own contexts. So that would be—I guess, my thought would be to go to do some research into, you know, where are these constituents gathering and, you know, would they be, you know, open to, you know, a dialogue with you. My guess is they’re probably organized in some way or another and it’s really just a matter of kind of figuring it out. It could be through schools as well. So we can—I don’t know what we can do to help in that case. But if you can think of something or—you know, we’re certainly open to it. FASKIANOS: Thank you. I’m going to go next to Kristen Edgreen Kaufman. Q: Hi, Ambassador Hachigian. Thank you for doing this very informative talk. It’s been very, very helpful. I have a couple of questions. First, I would love to get your thoughts on the trade memorandum of understandings that the U.K. is currently signing with many states and local municipalities—your thoughts on that. And I guess the bigger question is: How can cities make sure that they are fully aligned and in step with the federal government so that we’re not used kind of as pawns for foreign governments that might be approaching cities to achieve an aim that the federal government has already said no to? HACHIGIAN: Another great question. So the U.K. memorandums of understanding, I know that, you know, a bunch of places have signed those and, you know, just make sure the terms make sense to you and that there’s something in there that says it’s nonbinding. At least that’s what I would recommend. I don’t even—I’m not sure they can actually legally be binding anyway. But just to protect, you know, your own interests, that it’s more of a, you know, a guidepost than it is anything that you are committing to. The U.K., obviously, is a great friend of the United States so not really worried about it. But I think that’s just sort of a best practice and you—feel free to send it to us and we can always comment on it as well. And in—yeah, in terms of your other question, I would say just try to keep connected to us and let us know if there are approaches that don’t feel right to you or feel like they are masking something else and, you know, we can, you know, offer briefings that could be informative. FASKIANOS: There are several questions about point of contact. Can you restate? And we’ll include this in our follow-up email, the email address that people should use to contact you. HACHIGIAN: Yeah. So it’s subnational, S-U-B, and then the word national but one word, [email protected]. FASKIANOS: Wonderful. I’m going to take—try to sneak in one last question from Reed Holwegner. So if you could be brief that would be great, and my apologies for not getting to the rest of the wonderful questions in the chat and raised hands. Q: Thank you very much. I’m the nonpartisan director of legislative research in the South Dakota legislature and I’ve been staffing legislatures for over a quarter-century and I’ve observed that oftentimes changes in our tax law or economic development programs or property laws may start to touch into the areas of foreign policy. The resources, I think, at the state level that would be most beneficial for staff and legislators is a deeper understanding of how we can unintentionally affect foreign policy or make it more difficult for the United States to further negotiate with other countries. HACHIGIAN: Thank you very much for that comment and context, and it’s not, to be frank, an issue we’ve tackled yet or figured out how to tackle yet. But I think you’re right that it can happen. I know that it can happen, and I’m not exactly sure where the lines are yet. So but it’s something that I—you know, it’s on my mind and we will, you know, think through the right way to, you know, to, you know, think through that issue and connect with the states. But thank you for that. Appreciate it. AYRES: We are—we have about one minute left so I think we’re close to the end here. But I just wanted to say how impressed I am with the level of engagement—some very specific questions for the new Office on the City and State Diplomacy. Ambassador Hachigian, you’re going to have a whole slew of new emails for the team to answer and help connect people. It’s clear that there’s a desire to have a lot more international engagement and build those bridges. So great to have been part of this conversation today. HACHIGIAN: Yeah, I agree. Thank you so much to you and the Council. And, yeah, I’ve created—we’re creating a lot more work for me, but that’s the idea. (Laughter.) FASKIANOS: I echo all of that. And, again, as a reminder, we will send out the link to the webinar recording and transcript along with the links to the things that were mentioned. You can also follow Ambassador Hachigian’s work at the State Department on Twitter at @SubnationalDip, and, as always, we encourage you to visit CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for more expertise and analysis. For those of us who are first timers we hope you will return for subsequent webinars for State and Local Officials. We will be sending out our announcement for the next one shortly, and you can email us, [email protected], to let us know what else we can be doing to support the important work that you are doing. So, again, thank you all for being with us, for your terrific questions and comments, and we look forward to continuing the conversation with you all. AYRES: Great discussion. Thank you. FASKIANOS: Have a good day. (END)
  • Disasters
    U.S. Preparedness for Nuclear and Radiological Threats
    J. Andrés Gannon, Stanton nuclear security fellow at CFR, discusses the likelihood of Russian deployment and use of nuclear missiles against Ukraine or its allies, and the implications for the United States should that occur. Jerrold T. Bushberg, chairman of the board and senior vice-president of the National Council on Radiation Protection and Measurements, discusses preparedness for nuclear and radiological disasters at the state and local level in the United States. TRANSCRIPT FASKIANOS: Welcome to the Council on Foreign Relations State and Local Officials Webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. Thank you for taking the time to join us for today’s discussion. As a reminder, the webinar is on the record and the audio, video, and transcript will be made available on CFR’s website, CFR.org. CFR is an independent and nonpartisan membership organization, think tank, publisher, and educational institution focusing on U.S. foreign policy. We are also the publisher of Foreign Affairs magazine. As always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments across the country by providing analysis on a wide range of policy topics. We’re delighted to have participants from approximately forty U.S. states and territories. I’m pleased to introduce our speakers today, Andrés Gannon and Jerrold Bushberg. Andrés Gannon is the Stanton nuclear security fellow at CFR. Previously, he was a post-doctoral research fellow at the Harvard Kennedy School Belfer Center and a Hans Morgenthau research fellow at the Notre Dame International Security Center, as well as a defense fellow at the NATO Defense College. His research focuses on the political origins of military power, what capabilities states arm themselves with and why, and how the distribution of military capabilities affects states’ conduct in international affairs. Jerrold Bushberg is a clinical professor of radiology and radiation oncology at the University of California Davis School of Medicine. He’s an expert on the biological effects, safety, and interactions of ionizing and nonionizing radiation and holds multiple radiation detection technology patents. He is also the chair of the board of directors and senior vice president of the National Council on Radiation Protection and Measurements—the NCRP—a congressionally-chartered institution which formulates and disseminates information, guidance, and recommendations on radiation protection and measurements, and he previously served as a commander in the U.S. Naval Reserve where he was executive officer of the Chemical/Biological/Nuclear Technical Unit 120 Pacific. So thank you both for being with us today. We appreciate it. Andrés, can you talk first about the possibility of deployment and/or use of nuclear weapons in Russia’s war in Ukraine, and U.S. options in response to such action if it were taken? GANNON: Sure. And thank you, again, for having me and thanks to all for participating. Nuclear use and Ukrainian nuclear use, in general, is, to sort of start, a low probability/high magnitude event. So like we think of a lot of natural disasters, we’re forecasting worst case scenarios because the consequence would be incredibly high. Even though it’s unlikely, those are things that we have to prepare for. I think in the Ukraine context there’s three distinct nuclear scenarios that we can see for potential use by Russia, and I sort of order these from the least immediately consequential in terms of sort of death counts, casualties, and other costs to most. The first is, as a signal, I think that Russia has not tested a nuclear weapon since they were the Soviet Union in the sort of late ’80s. But I could see them testing a nuclear weapon either somewhere remote in northern Russia, possibly somewhere near Ukraine, in the ocean or in the sea, to demonstrate a willingness to use a nuclear weapon. Even though the casualty of such an event would be close to zero—such an event would be designed to have a low casualty—there are environmental effects and, more importantly, effects on sort of morale and people’s thinking about the likelihood of using nuclear weapons. So when we think about the consequences that would have for other countries thinking about acquiring or detonating nuclear weapons, there’s, potentially, second order ramifications on that sort of international system. The second scenario is one in which a sort of smaller tactical battlefield nuclear weapon is used and this is a tricky one to think about because, as we’ve seen with a lot of other weapons that are things like chemical weapons, it’s really difficult to predict the effects of even small nuclear detonations an hour, a day, a week later. The radiation that would happen from such an event could be one that blows back towards Russia in ways that could negate their benefits. It could create a sort of no man’s land in the region in Ukraine that will be impassable for some short period of time by military personnel on both sides. But I think that’s precisely the reason such an event could happen or could be sort of logical or strategic on Russia’s end as a way of halting Ukrainian advances. I think that we can think of tactical Russian use of a nuclear weapon in some of these cases where they’ve been losing ground and where the Ukrainians have been seizing territory as being a way of creating sort of a large tank ditch that would be impassable for a short period of time to stop Ukraine from advancing. So I think that that’s the logic that could exist there, particularly in the eastern Ukrainian region. The third most immediately consequential scenario for Russian nuclear use would be a strategic use of a nuclear weapon that wouldn’t necessarily be a sort of large strategic ballistic missile but will be targeted at civilians. This could be civilians that are in Ukraine. This could be civilians that are in nearby NATO countries. I think that the latter scenario is very unlikely since Russia and NATO, I think, so far has sort of tacitly agreed to limit by design the degree to which they’re interacting with each other directly. But I could see a situation where Russia feels that a sort of way to escalate the current attacks that they’ve had on the public in Ukraine, the sort of missile strikes that they’ve been doing recently, to ratchet that up with nuclear use could be a way to break morale in a way that would make Ukraine halt their advances and possibly give up in the conflict, in general. So I sort of want to wrap up there from where I started, which is none of these scenarios are incredibly likely but they are all very consequential. And so I think that when we think about what the U.S. response should be to these situations we can think of the response ex ante—what are things that the U.S. can do in advance to make sure that these events don’t occur—and then what would be the U.S. response ex post in the sense of if they did occur what should we do. In terms of ex ante, I think it’s really important that the U.S. continues to communicate to Russia behind the scenes where red lines are but to remain ambiguous about the consequences of crossing those red lines. A lot of research that has been done on sort of these sorts of threats and red lines indicates that being clear that any nuclear use would be unacceptable but remaining ambiguous about what sort of retaliation or consequence Russia would face is the way to make sure that these threats are both credible because there’s a clear line in the sand that we’re telling Russia not to cross while still making sure that the United States has flexibility in how it decides to respond afterwards, given new information that’s revealed about the consequence, that motivation, the situation at hand, et cetera. And so there’s sort of a lot of secret information that’s existing at the government level but that communication has to continue to happen between the United States and Russia directly. In terms of ex post, I think a lot of the humanitarian aspects of nuclear use are relevant in all of these situations. There’s a lot of very good, important environmental monitoring that’s done by a lot of folks regarding, as I’m sure Jerrold will talk about, the sort of radiological effects of these sorts of weapons, what effect that has on crops and agriculture. We have already seen sort of the effect of the conflict on wheat exports and prices in Ukraine, which would only be amplified in this situation. Transportation, mobility, possible refugee flows out of the region is something that has to be anticipated. And so I think that these are things that sort of matter at the state and local level in the United States because public opinion also matters in a lot of these things. There are about twenty-nine U.S. states that currently have nuclear power plants and there’s 10 (million) to 15 million people last I checked that live within ten miles of a nuclear power plant in the United States. When sort of radiation, detonation, anything that involves the power plants in Ukraine, anything that happens there, I think, would be directly relevant for how U.S. people in state and local regions here feel about the consequences of having nuclear facilities nearby and whether or not that’s something that would, potentially, pose a danger to them. Thank you. FASKIANOS: Thank you very much. Let’s go now to you, Jerrold, to talk about emergency preparedness for nuclear and radiological events in the U.S., what it would mean if such an attack would happen, and how states and locals can best prepare for the threats of this kind. And you are muted. You could unmute or—hold on a minute. BUSHBERG: There we go. FASKIANOS: There we go. Perfect. BUSHBERG: Thank you. All right. Very good. OK. So thank you for the opportunity to present this information, and I think you’ve set it up very nicely. We’re going to just take some—a few minutes to talk about the kinds of incidents that could occur and what their effects would be and the—in particular, those effects that would, if it occurred somewhere else in the world, what would that mean for radiation exposure in the United States and what particular actions, if any, would be implemented. So my comments will cover a broad range of different types of nuclear yields, most of them likely much greater than I would anticipate from the discussions that we’ve just talked about previously. But I think before we get into more of the detail, I want to make sure I give you the bottom line up front, which is that even if there was a very large detonation anywhere in Europe there would be no need to take protective actions if you’re living in the United States or even its territories and outside the continental United States, including Hawaii and Alaska so—and the reason for this is several fold. One is, is that—and we know a lot about this because there have been a number of nuclear detonations, I think over four hundred up until 1980. So we know about what the distribution of radioactive materials is like, and there are two principal things that occur. One is that the material—the radioactive material—gets injected into the atmosphere and at different levels in the atmosphere it behaves in different ways, and primarily a material that goes into not the troposphere but above that—in the next level above that, which is over about six thousand feet or so, that material pretty much stays there for a relatively long period of time, and the material that’s lower and the percent that goes into the lower versus the upper really depends on the yield and how far above ground it was detonated and a lot of other technical factors. But I really think the point here is, is that there’s a tremendous amount of dilution that occurs because of the normal dispersion of this material, and also if you look at the air currents in that—in the world they move from west to east. So even if there were a detonation somewhere in Ukraine it wouldn’t take the four-thousand-mile shortcut directly to us. It would have to go kind of the long way around the Earth, which will result in even greater dilution. The other aspect of it is that the radioactive material has different life spans, if you will. We call them half-lives. But I think one way to characterize it is that after twenty-four hours approximately 80 percent of the radioactive material that was generated will have decayed and after about two weeks or so it’s about 90 percent. So the concerns are, really, for people that are in that region or for the sort of immediate aftermath within the twenty-four, forty-eight hours, and for them the critical issues are—and we’ll talk about this in a minute a little bit more—are about seeking shelter and preventing contaminations and fallout. OK. A couple other things I wanted to mention. There are a number of guidance documents that are available both from the NCRP and from the federal agencies, and we can provide that link later and make it available to those who are interested. The radioactive material that’s produced, as I said, mixes up in the atmosphere and the dilution and decay result in very, very little of the radioactive material ending up in the United States from a detonation outside of the United States. And so one of the questions that often comes up is, well, can you—would we detect any increase in radiation and the answer is, yeah, we would. Why is that? Well, because we have incredibly sensitive radiation detectors and the amount that we can detect with our detectors is, literally, tens of thousands of times smaller than the level that would be of concern for public health. So the mere detection of a(n) increase would not necessarily pose a health threat and there are, as mentioned earlier, a number of monitoring stations in the United States that are run by governments and states and universities that monitor radiation levels 24/7/365. So we would know if the increase occurred and also if it occurred from a nuclear detonation as opposed to some release from a nuclear power plant. Experts can distinguish between those kinds of releases. So there has been a tremendous amount of study into this, and those kinds of rapid determinations are well within the United States’ and other countries’ capabilities. So I think one of the important things that—lessons learned from other releases—accidental releases—that have occurred like at Hiroshima—I’m sorry, like at Fukushima and at the Chernobyl nuclear power plant accident—is that people have seen a lot of material either on social media or on the internet telling people to take various anti-radiation drugs or so forth and so on, and that should not be done either. There is no reason to take these kinds of medications and, in fact, the vast majority of them are only good for very specific radionuclides and they do have side effects. So the most important advice is to listen to your state and local officials and follow that guidance, and so there will be official guidance available both at the local, state, and federal level. And to help put some of this—the amount of radiation into perspective for you, let’s say that we go back to the 1980s and China’s last aboveground detonation was in multiple megaton, which is a very, very large nuclear weapon, and the average dose to people around the world was, you know, about 1/1000, so about 1 percent of the dose that we all get from natural background radiation. Just to say a little bit more about that, you know, all of us are exposed to radiation all the time from what we refer to as naturally occurring background radiation and it comes both from cosmic rays and as well as the naturally occurring radioactive material that’s in the ground and that gets into the plants and, therefore, gets into the animals, and we eat plants and animals and so we have radioactive material in us. And so, on average, the—in the United States the typical background radiation is about three millisieverts per year and the amount of radiation that you might get, which is—well, to put that in perspective, it’s about the amount of radiation you get from a thoracic CT scan. That’s the amount of radiation, and the amount that you—that people got from those detonations, the very large aboveground nuclear test, was, you know, hundreds of times less than that. So the take home point, really, is that regardless of the yield anywhere outside of the United States, the amount of radiation we receive will be very small. There are very accurate monitoring stations around the United States that can detect very small increases in radiation and the government has a very well thought out and very rapidly implemented program for responding to such events to provide both information and monitoring information. And I think that as long as we don’t overreact to a situation like this and, you know, it is a critical situation but we need to remain calm, listen to the authorities, not overreact or certainly don’t take the advice of individuals who might be going on television or might be coming from other areas but are not representing what we typically refer to as, you know, the consensus of scientific opinion, I think we’ll be fine. So, with that, I’ll wrap it up with that and then be happy to respond to any questions that come up. FASKIANOS: Great. Thank you very much. And, yes, we will send out a link to the sources that you recommend after this. Now let’s go to all of you for your questions and comments and, of course, we—this is a forum to share best practices. So if there are things that you’re doing in your municipality please share those with us. It’s good information for your colleagues. So you can either raise your hand by clicking on the icon and I will call on you. You can also write your question in the Q&A box, and if you do write your question then please also include your affiliation and state so that we can give context. So I’m going to look now for any raised hands. We have two already. So I’m going to go first to Mike Ladd and if you could unmute yourself—accept the unmute prompt, rather—that would be great. Q: Yes, ma’am. Can you hear me OK? FASKIANOS: We can, and identify yourself. Q: Yeah. My name is Mike Ladd. I’m the deputy emergency manager for Clay County, Florida, which is just southwest of Jacksonville. First, thank you so much for the presentation and answering this niche. I think the one assumption that’s made and kind of want to get your thoughts on it is, largely, this discussion is circulated around an initial or one or a singular nuclear detonation. However, there’s a lot of doctrine out there that that may trigger more and what if we have a whole bunch and not—you know, the whole retaliation? I understand that’s very hard to scope and scale. But in some of the commonalities that were discussed about 90 percent, you know, degradation of radiological hazard after about two weeks, what are your thoughts as far as how to sew that into a comprehensive emergency management plan? BUSHBERG: Well, I think that the most important thing to understand is that if you’re talking about a detonation that would be in the continental United States or let’s take it the other direction, say, that there are U.S. citizens in a region where a detonation occurred, you know, the most important thing that one can do is to—you know, is to seek shelter and to tune in to the local emergency broadcast for further information. The real risk is to those individuals that are outside the zone of lethality but are in an area where there could be significant amounts of fallout that could occur over the hours, days, and weeks later. But in the first few hours is really the most important response, or I guess most critical response time. And for that you would want to seek as much shelter that puts—in a building, maybe in the center of a taller building that puts a lot of material between you and the fallout, and that can substantially reduce the risk and the amount of radiation that individuals would receive. So if we’re talking about the sort of worst case situation where individuals are close to such a detonation that would be the appropriate actions. FASKIANOS: Thank you. I’m going to go next to Jeffery Warren. And, Andrés, if you want to add anything please feel free to jump in. Q: Thank you. Jeff Warren, Memphis City Council in Memphis, Tennessee. I just was wondering what Andrés thought about the possibility of this going completely south—it goes along with the question prior to that—and how aggressive we should be on the local level to be thinking about stocking fallout shelters and doing things that have occurred before. GANNON: Yeah. It’s a good thought. I have two sort of things I’m thinking about in response. The first is a weird part of the way that we’ve thought about it, the logic behind why a nuclear weapon wouldn’t be used is your target will fire back and neither side wants to be on the receiving end so no one will use it. That logic seems to make sense until the first missile is launched, in which case if Russia launches a missile on the United States and it’s—well, we’re supposed to respond. That’s what all the books have said, you know, since the 1950s. And that’s sort of a tricky and a hard thing to think through. And so I don’t think that we know, thankfully, given lack of experience, of what that escalation trajectory would look like. But I do think that the military and sort of high-level political officials involved are starting to think about the role that nonnuclear weapons would play in response and having this sort of cross-domain or cross-capability conflict. What that sort of means at the state and local level, I think, is difficult to figure out. But it’s a place that the research is going now that, I think, is important. In terms of what this means for state and local officials in the United States if this were to go south, there’s a lot of sort of research that we don’t know that’s classified regarding targeting that, I think, is something that’s worth thinking about. Nuclear strategists think about targeting, broadly speaking, in two dimensions. You can target what your opponents value, meaning their population centers and civilians, or you can target what is strategically important, meaning their military installations. You know, U.S. targeting is, largely, classified with the exception of some recently early Cold War documents. We don’t know what Russia’s targets would be in the event that they were to attack the United States but they probably have some plans there. I think if I were to speculate, the smartest thing to do in the early phases of a war is to target your enemies’ military capabilities. Those are the things that could be launched sort of against you and that would cause the most damage. So what this means is that states and localities where U.S. nuclear weapons are housed—our ICBM facilities that are in the Dakotas, you know, Wyoming, Nebraska, the Midwest in general—also, possibly places on the coast where U.S. nuclear submarines are based from or where they sort of get their intelligence, refueling, and maintenance. If I was Russia that would sort of be the first round of attack before I started thinking about the Los Angeleses, the D.C.s, the San Franciscos, et cetera. And so I think that that’s sort of a way to think about where this thing might go south if it were to start going in that direction. Now, how far would the escalation go? Would we end up with all military targets on both sides taken out and then we’re swapping city for city? It’s hard to say. But I think that if we think about the first step it would be places that are militarily-valuable targets for Russia to think about in the United States. Q: Well, in Memphis, you know, we just worry about logistics with FedEx. So we’re, you know, wondering how—where we would be on their list. GANNON: Yeah. I can’t speak to Memphis itself but I do think that your point about sort of transportation, infrastructure, logistical hubs is really important. I know that, for example, in Long Beach they’ve put a lot of work into making sure that the ports there are safe and secure in detecting, you know, possible radiological use and, you know, possible terrorist attacks that could happen there precisely because of the value that these ports have. So I think that that emphasis is well placed in the same way that, you know, we have things like TSA, not necessarily because airports are the most likely to be targeted but because the cost is really high. I think that infrastructure hubs that can do similar measures for security are putting resources in places that make sense. Q: Thank you. FASKIANOS: Thank you. I’m going to take a written question from Linda Lewison, who’s with the Nuclear Energy Information Service—it’s a safe energy watchdog in Illinois—and the question written is other than modeling has there ever been an actual emergency response exercise for a nuclear power plant accident that would release large amounts of radioactive waste into the atmosphere in a relatively short timeframe? We, in Chicago, will probably have, perhaps, an hour or so to respond. Then she notes that there’s more radiological waste in Illinois than any other state. I don’t know who wants to take that. BUSHBERG: Well, I guess—I’m sorry. Was the question what would one do if there was or has there ever been a release from a—there have been—you know, so there was the Three Mile Island accident in the United States, which did not release a tremendous amount of radioactive material. In fact, quite, quite small amounts compared— FASKIANOS: I think— BUSHBERG: —to the others. But was there—and is there something else that they wanted a response to? FASKIANOS: It was more a question about is there—has there ever been an emergency response exercise. Like, what kind of gaming and— BUSHBERG: Oh. Yeah. FASKIANOS: —and responses to—you know, just like we have fire drills or— BUSHBERG: Yes. The— FASKIANOS: —those kind of things. BUSHBERG: Right. FASKIANOS: What’s happening on that front? BUSHBERG: Sure. So the Nuclear Regulatory Commission requires all nuclear power plants in the United States to not only plan an exercise for a potential release but also work with local hospitals and medical and emergency response assets that would be responding to or supporting such an accident. There’s also very detailed emergency planning guidance that details evacuation zones should they be required. In the case of a nuclear power plant accident, you know, we’re concerned about sort of different radionuclides than we would from a nuclear weapons detonation. And there are things like radioactive iodine or something we’d be particularly concerned about and local health officials have planning guidance about whether potassium iodide, which is something that can block the thyroid gland from taking up radioactive iodine, would be necessary and they have stockpiles of this local to the nuclear power plants that are available for local health officials to dispense if that turns out to be a suggested guidance. But, you know, the most important thing one could do if you heard about any sort of radiological release in our national guidance, and this would apply even to a very large release, is to—you know, you would get inside, stay inside, and stay tuned. So if you just remember those three words or three phrases—to get inside, stay inside, and stay tuned—you will protect yourself from the vast majority of any potential harm that can occur because the real concern is fallout or deposition of radioactive material contamination. FASKIANOS: Right. So, Jerrold, there’s a written question, and this is for you to clarify, from Samer Jaafar, who is in Wayne County, Michigan, and, perhaps, this is not what you said but writing—you state not to take KI potassium iodide that you feel will not benefit and—benefit you anyhow. They are advised by the State Department of Environmental Quality of an air sample or dosimeter when it reaches a certain exposure level during our training preparedness for REP. So can you clarify what you meant? BUSHBERG: You bet. Yeah. Thank you for that question. FASKIANOS: That would be great. Thank you. BUSHBERG: Thank you for the question. What I was saying is that if there was a detonation in Ukraine, there is under—there would be no circumstances under which potassium iodide would ever be recommended because there is just not going to be enough exposure to warrant it. Now, that’s different than what I just talked about, which was maybe a release from a nuclear power plant, for which potassium iodide is very effective at blocking just radioactive iodine. None of the other nucleotides that might be released; potassium iodide would not have any effect on those. So planning guidance does provide for state and local officials guidance on environmental monitoring and at what levels they might suggest the distribution of potassium iodide, but that would be a public health decision in coordination with both the state and federal agencies. FASKIANOS: Great. Thank you. I’m going to go next to Ted Voorhees, who has a raised hand, from Orange County in Virginia. If you can unmute yourself. Q: No question. I’m sorry. FASKIANOS: There we go. Oh, you don’t have a question. OK. Q: No. Thanks. FASKIANOS: All right. Thank you.                     I’m going to go next to John Jaszewski. And excuse my pronunciation. And if you can unmute yourself. Q: Now can you hear me? FASKIANOS: We can. (Laughs.) Q: OK. Thank you. I’m John Jaszewski. I’m calling from Mason City, Iowa, which is in northern Iowa. And I’m curious as to whether or not you can forecast, if Russia releases a tactical weapon in Ukraine or somewhere in Eastern Europe, would it follow that they’ll eventually release a strategic weapon toward the United States. GANNON: I can start with that one. I don’t—what that answer depends on is what do we think is Russia’s goal in Ukraine, what do we think is Putin’s goal in Ukraine. And there’s a variety of different answers that all point to different expectations about the degree to which they would go further and escalate in a conflict. Maybe their goal is just material and strategic. Maybe Russia does want this territory, these sort of four areas that they’ve taken, and they want Crimea because they think that it’s a part of Ukraine, and maybe access to the naval base in Sevastopol is helpful. That’s fairly limited. Maybe it’s a little bit more, in that there’s some sort of nationalistic impulse of people that they think are truly Ukrainian people, sort of pushing back against Western expansion and embarrassment since the end of the Cold War and NATO expansion, in which case Russia’s aims are a little broader. Maybe Russia just wants to sort of once again be an imperial superpower and the most dominant state in the world, in which case they really want to push back against the West and they have greater sort of territorial and reputational ambitions. In reality, it might be some combination of all of these things. We don’t know and I don’t know that we’ll ever know. But I think whatever events we start seeing about Russian escalation shed some light on what we can infer as the likely motivations. I think that tactical nuclear use in Ukraine would be helpful—potentially be helpful for Russia towards any of those gains. I explain sort of one way in which it could be helpful to them militarily, and it would be helpful in terms of taking territory and showing the West that sort of they are a powerful, dominant country. I think that if they were to then take the next step and attacking NATO or the United States directly with a strategic nuclear weapon, that’s not a decision that you make if your goal is to get access to a naval base and if your goal is to have control over these four regions, some of which you have kind of controlled so far. That demonstrates sort of larger imperial ambitions maybe at the personalistic level for Putin himself that are very different. So I know that that doesn’t really answer the question because it doesn’t tell you what I sort of think are the likelihood of all of these things, but that’s because I don’t think that that can be answered ahead of time. And I think that people that sort of have—the stronger someone’s opinion is about what is Russia’s true motivation, the less confident I am in sort of the reasons that they’ve given for why that’s the case. But I think that the scenario in which Russia decides that their aims are best served by directly attacking the United States with nuclear weapons is a situation where Russia and Putin’s geopolitical ambitions are largely unparalleled and inconsistent with a lot of actions that we’ve seen so far. And whether or not he thinks that that’s something that would help him because he’s backed into a corner and this is sort of a Hail Mary strategy for maintaining power, or whether he thinks that this is the nail in the coffin for defeating the West, I think both of those scenarios are hard to say. So I think that we have to see many, many other actions happen first before we get that scenario. It wouldn’t be a bolt from the blue. FASKIANOS: Great. There is a written question from Cailey Hansen-Mahoney from the Ohio General Assembly: Have you seen any successful legislation to protect nuclear power facilities/storage at the state level? Any recommendations for best practices for state legislatures to support incident command/emergency planning as we discuss this possibility? BUSHBERG: Well, starting sort of with the last part first, yes, there is—are some outstanding documents. NCRP has a number of documents that speak to these questions directly. NCRP Report 165, which is entitled “Responding to Radiological or Nuclear Terrorism Incidents: A Guide for Decision Makers,” this is free to download from the NCRP website. The NCRP website is ncrponline.org. And so that document is freely available, and there are a number of other documents that NCRP scientists have put together that go into some significant detail about both preparing for, planning, and executing response to radiological releases. Now the—now I’m forgetting what the first part was. Oh yes, the fuel onsite—protecting the onsite fuel. So the Nuclear Regulatory Commission has regulations about the storage or protection of this radioactive waste, which are essentially the materials that once the fuel rods have been in the reactor for a certain period of time and they have expended their practical usefulness that are taken out. And at that point, they’re extremely radioactive. They’re put into pool storage where water is circulated to remove the heat, and then ultimately are put into what’s referred to as dry storage. In the United States today, all of that sort of spent nuclear fuel is stored onsite at the reactors because we don’t have a long-term storage repository in the United States. So the—all of the utilities have precautions and protections of that material, and it is stored in very robust and hardened facilities that would make the release of that material very, very difficult. (Pause.) OPERATOR: Irina, can you please unmute yourself? FASKIANOS: Yes. There you go. (Laughs.) I want to go next to Bill, who has raised his hand. And if you could identify yourself. Q: My name is Bill Stoutenborough. I’m in Madison County, Illinois. I think we’re being a little bit naïve in saying we don’t know what Russia’s goals are. It appears that—let’s go by what they’re doing instead of what they’re saying. They want to weaken NATO. They want to exercise controls over the EU. They had controls with oil lines, pipelines, fertilizer, et cetera. What they—the strongest control they can get is food, and Ukraine has more production area than any other in the European area. They supply over 30 percent of the food to Europe and to other areas of the world. Now, they’re not attacking military targets; they’re attacking infrastructure, such as knocking out the electricity. That is being done here in the United States. We talked about nuclear. Their former president has indicated they want to move battleships armed with their hypersonic weapons within the areas of the—political areas of the allies supporting Ukraine. They even specifically indicate Washington is within the 600-mile range of hypersonic missiles, which cannot easily be detected because they’re a low-trajectory item. What type of—I guess at some point in time I think we’re going to have to fight Russia. We are being reactive and never proactive. I think that we should proceed in getting the other two Scandinavian countries into NATO. I think we should even allow Ukraine to start its—restart its process into NATO and Article 5. FASKIANOS: Thank you. Thank you very much. Andrés, do you want to respond to that comment? GANNON: Sure. Yeah. Thank you, Bill, for those thoughts. I think that there are sort of ways that we can infer what Russia’s goals might be based on what they’ve done. You’re certainly correct about that. What I think is challenging to do in the long term is figure out: Where would Russia be satisfied? What, for them, is an outcome where they will say we’re OK with this, there’s no other changes that we want to make to the world? Does that mean having part of Ukraine be Russian territory? Does that mean all of Ukraine? Does that mean NATO pushes back to the sort of pre-NATO-expansion boundaries? Does that mean NATO doesn’t exist? Does that mean the United States doesn’t exist? These are all sort of hypotheticals that I think are hard to think about, but all are very different in terms of what they think that—or, what they suggest the U.S. strategy should be. As far as the point about preempting what Russia is doing, I think that’s something that’s currently in discussion by national policymakers. But what’s tricky is Russia isn’t the only thing that the U.S. is concerned about when it comes to great power competition. We saw in the recent National Security Strategy increased concern about China’s activities, the U.S. sort of starting to think about a new tripolar or trilateral world, where there’s two threats that we’re thinking about simultaneously. And so I think that as we think about what, if anything, should we do to weaken Russia, where those resources come from is an open question that I don’t have the answer to, but that I hope that those that are in charge of making those decisions are thinking about. FASKIANOS: Great. Thank you. Jeffrey Semancik has written a couple things in the Q&A—suggestions, best practices. And I thought maybe you could just share with the group rather than having me read. And so I would like to invite you to unmute yourself. Q: Yeah, hi. This is, yeah. Can you hear me? FASKIANOS: We can. If you can just identify yourself too for the group and just— Q: Yeah. This is Jeffrey Semancik. (Off mic.) FASKIANOS: OK, we can’t hear you now. (Laughs.) Jeff, can you—we can’t hear you anymore. OK. Q: I got it. No, I got it now. FASKIANOS: OK, good. Q: So, yeah, I’m sorry. Just we’re in a conference room here trying to organize some stuff. But so just wanted to point out a couple resources available to state and local officials. I think Jerrold presented NCRP reports. There was also some recent guidance from FEMA related to a nuclear detonation published in May of 2022 that’s available from FEMA’s website. And finally, there is a group that we’re working with to try to build nuclear subject matter experts on nuclear—on response to nuclear and radiological events. It’s called the Radiological Operations Support Specialists, the ROSS. And I provided an email address for folks that are trying to work through some planning guidance. And these are folks that are volunteers of a type by FEMA that can come in and provide consistent—you know, some information consistent with the latest guidance documents, help you understand the consequences, answer your questions on a local and state level. So may be something that folks might be interested in. And I provided an email contact to FEMA if you’re interested. FASKIANOS: Fantastic. So, yes, in the Q&A—and Jeff is with the Connecticut Department of Energy and Environmental Protection. The email address is [email protected]. And, again, we will be sending our links, and we can include that email address too, so that you can go there as well, along with the Report 165 that was published by the NCRP. OK— BUSHBERG: Let me just mention, if I could— FASKIANOS: Yes, go ahead, Jerrold. That’s great. Thank you. BUSHBERG: You know, Jeff, thank you for reminding me about those, that I hadn’t mentioned them. But, you know, the Nuclear Regulatory Commission, the Department of Agriculture, Food and Drug Administration, the CDCPA, and FEMA, as you suggest, all have excellent documents on various aspects of responding for—responding to and planning for such events, from very small to very large. And we will provide all those things to the audience, for their use after the conclusion of this event. FASKIANOS: Great. Thank you. I don’t see any more questions from new people, so I’m going to go back to Linda Lewison, who has written a few in the—in the chat. But maybe you could talk a little bit about how is the U.S. protected from the new super weapons from Russia that are going around the world in submarines? Are they—can get they got into a position to attack our coastlines? And, Andrés, maybe you can answer that. GANNON: Yeah. So the new Russian weapons have largely puzzled me, to be honest, because they don’t offer anything new for Russian in terms of targets that they can hit, or in terms of the lethality of potential strikes that exist there. It’s largely been an open secret among the superpowers, even since, you know, the Strategic Defense Initiative way back during the Cold War, that missile defense is almost impossible. It’s incredibly difficult to do. If there was a target in the United States that Russia wanted to hit, they have been able to hit it for decades. What these new weapons do is they provide some degree of speed, which might be helpful in terms of—to minimize the amount of preparedness that can happen at the local level. But I think that that’s largely minor. And a lot of it is political. It’s a way of showcasing their sort of increase resolve or their willingness to do things, because they’re investing more in being able to sort of have a high-technology military. There’s also a lot of just prestige-related reasons why countries want to have the best and the shiniest military capabilities, even if they don’t offer that much strategic utility on the battlefield. We see this a lot with conventional military capabilities, where some of the best U.S. aircraft carriers, for example, or naval and air capabilities are ten, twenty, thirty, forty years old. And they’re really good. Nd the newest ones are marginally better, but not that much better than some of the capabilities that we’re largely relying on. So I think that we should think about these new advanced Russian hypersonic missiles, et cetera, as being less about having military utility in terms of giving them an edge in a conflict, and more about having political utility in terms of how Putin and the Russian government sell this to the Russian public, how they communicate this to the United States, and how they think these things would impact U.S. resolve. So I think a lot of it is theater. And I don’t say that to diminish it. I think that theater is really important. I think a lot of politics is about theater and communication. But it’s about sort of communicating things rather than enacting particular military things differently. FASKIANOS: Thank you. Cindy Wolf has raised—a raised hand. If you want to unmute yourself. Q: Hi. I come from a county that is surrounded by various military installations. But we are remote, and we are an archipelago. So I have some interest in a clarity on time scale and kind of some red flags that we might want to look for in terms of this Ukraine-Russia conflict escalating to something where we would start to need to be concerned about educating our people want to do on short notice. GANNON: I can start with that one. One place that Russia has been oddly unimpressive in the Ukraine conflict is electronic warfare. We have not seen many successful uses by Russia on that front. There’s some sort of hypotheses people are positing now for why is Russia’s electronic warfare so bad? And to clarify, what I mean by that is the parts of warfare that deal with, like, jamming, radar, and communications, making computers unable to work and function, radios, things like that, maybe Ukraine is really good at defending against electronic warfare. They have capabilities that are decent, but nothing that should be way better than what Russia is doing. Maybe Russia can’t jam because their equipment is too similar to the Ukrainians, and so they sort of get their wires cross and it could affect them. But I think that’s an under-discussed part of the Ukraine conflict that has ramifications for exactly what you described. If Russia were to sort of be engaged in a direct conflict against the United States, the first two things that they would need to do, or would be smart for them to do, is, as I mentioned a little bit earlier, direct kinetic attacks on capabilities that would be relevant in U.S. first strike. So targeting U.S. ICBM installations, places like bomber bases where we have sort of nuclear-based bombers, et cetera. And the second is for other things, especially naval and air capabilities, electronic warfare-type strategies to deal with command and control centers that communicate to U.S. capabilities that are deployed further away. So, like, U.S. submarines and surface fleets have communication with the mainland United States for the types of operations that they’re doing overseas. The sort of general best practice in militaries is rather than try to attack every single boat, attack the command and control centers that communicate with those boats to render them in the dark. And that’s a place where we’ve seen Russia performing poorly. So on the one hand, I think that’s some sort of vote of confidence, in an answer to your question, that I don’t think that Russia will be able to turn the lights out at U.S. military bases in the continental United States very, very quickly. On the other hand, that’s something that they know they’re going to have to do. And so I think that this is a place that I expect Russia to try to increase investments to how successful they can be at doing so, given sanctions and the amount of spending in their defense industrial base, I think is hard to say. But I think if you are in a locality that is militarily relevant for the United States, for reasons that are not the first forty-eight hours of warfare—meaning, ICBMs, nuclear bombs, et cetera—then I think that the electronic and the sort of grid capacity is the one that’s the most important to think about, in terms of the immediate effects. FASKIANOS: Thank you. I’m going to take—go ahead, Jerrold. BUSHBERG: Yeah. The only thing I would add to that is I think she asked about, you know, preparation and training. And I believe Jeff was the one that mentioned the FEMA documents and all the planning guidance for response to a nuclear detonation. It’s the third edition that was published in May of 2022. And it is the most recent complication of information that provides guidance not only on preparedness but response and also the guidance for emergency response part of the community, as well as local and state assets. So I would heavily recommend that. And, again, we’ll provide these links after the meeting. FASKIANOS: Great. Thank you. I’m going to take a written question from Commissioner Tyler Shuff, who is the commissioner of the Seneca County Commission: Why aren’t our schools teaching kids what to do in case of the bombs getting stopped? Why and when did this stop? Andrés, have you studied this? GANNON: I have a bit. Part of it is—so, Jerrold was making some good points earlier about sort of the immediate blast radius, and sort of what happens afterwards, the sort of radioactive zone. If you’re in that immediate blast radius, stop, drop, and roll is not going to do a lot for you. I think there was some recognition of that during the Cold War when this was taught, but people need something. We think about sort of the human and the political element of this, I think it’s hard to tell people: Prepare for a nuclear attack the same why that you prepare for an earthquake or a tsunami or a typhoon or a tornado. There is a lot of overlap. Like, 80-90 percent of it is the same. A lot of what Jerrold said about, you know, stay inside, have water, have food, have access to information and batteries and flashlights—that’s the same for all these things. But that’s sort of deeply unsatisfying at sort of a psychological level for people to think, oh, there’s nothing that I should do? There’s nothing that can help if this is nuclear as opposed to just a tornado? And so think that’s a thing from sort of the non, sort of, physical science or radiological perspective. From the political perspective, that’s worth thinking about for messaging, is what can you do to make people feel as if there’s something that is within their control when they come to preparation. I think this is why, like, the iodine tablets are popular, because people can feel, just, I bought something that someone said could help me in certain situations. I think I carry one on me. Oddly, there’s, like, these very small $10 or $15 basically sheets of paper you can have that have a detection of how much accumulation of radiation you’ve gotten on your body. That is mildly helpful in some situations, but it’s not going to make a world of difference. But these are the kinds of things that people want to do and want to think about, something that’s sort of within their control, or some decision that they’ve made. And so I think that your point or your question about why has this stopped in schools is along those lines. That’s just we want to feel as if there’s something that we can do, but it’s really not any different than a lot of the other drills we do for safety. That is, stay calm, stay inside, and make sure that you’re getting your information from trustworthy sources. And I think that last one is a point that we haven’t really explored here and probably don’t have time to, but is an important one for state and local officials to do. We saw, you know, since the 2016 election a lot of misinformation that is coming about politics. And it’s hard to know who to trust. I would be very, very shocked if any nuclear attack was not accompanied by a flurry of misinformation by the attackers about is it safe to go outside? What pills should you take? Where should you go? Who should you listen to? And that’s a place where I think state and local governments can do a lot to inform their people. Here are all the websites, here are the accounts that will tell you the actual information about when it’s safe to go outside. Right, not the person you found on Twitter who sends a picture that says: I’m outside. Everything is fine. That’s the kind of place where I think a lot of education can go a long way, and make people feel as if there is something within their control that they are doing that’s helping with preparation. I think that that’s something that can happen in schools that’s different from fire drills or hide under your desk. But at this point, I think it’s more helpful. BUSHBERG: Yeah, just to amplify that point a little bit—thank you for that—you know, it seems somewhat counterintuitive but I think, you know, people think about evacuating an area that has been subject to such a detonation or an attack. But if you’re outside of that zone of lethality where you haven’t been killed by the blast, that there following such a detonation, people I think instinctively would try and evacuate, or run, or get away. But that’s the wrong thing to do. (Audio break)—detonation is to seek shelter, and seek shelter immediately. And the best shelter is the largest, closest building you can find and be in the—sort of as close to the middle of that building as you can, with as much building on top of you, below you, and on the sides. And this is really to reduce the amount of radiation one gets from fallout. But the most important part of it is that you’re not trying to evacuate, you get stuck in traffic, you know, you have fallout occurring now over the next hours, and that can be lethal from a nuclear detonation if you are exposed to it directly early on. And so I can’t overemphasize the importance of this very, very prompt seeking of shelter, and to stay inside until the emergency and local public health officials can provide additional guidance. FASKIANOS: We have two minutes left. I’m going to just try to sneak in the question—or, a question from Eno Mondesir. If you could be quick, that would be great. And then people—you know, Andrés and Jerrold, if you can answer and give you closing thoughts, that would be terrific. And you need to unmute yourself. OPERATOR: Looks like we’re having some— Q: Sorry. FASKIANOS: Oh, there we go. No problem. Q: Yeah, I just wonder if any of the two experts could tell us how many nations already have nuclear capabilities, and what are the potential ones also? GANNON: So I think the count now is around nine nuclear states. U.S., Russia, China, India, Pakistan, North Korea, U.K., France, Israel. The states that are most likely to develop a nuclear weapon coming up would be Iran, sort of the one that’s being discussed. South Africa is the one case of a country that had a nuclear weapon and voluntarily sort of gave up that capability, which is a real interesting place to—that a lot of people are producing good academic work. So that’s where we are as far as who has nuclear weapons. There’s a weird way of thinking about who’s most likely to use nuclear weapons. Well, one answer is they’re being used every day, and that they are changing states’ calculations about what types of decisions to make and how they interact. Whether that’s a good or a bad thing I think is a subject of very important and unresolved debates, but one that hopefully continues. FASKIANOS: Jerrold, any closing thoughts? BUSHBERG: Well, I would just repeat, you know, really the two key items, which is, you know, if there is a detonation that occurs in Ukraine, there—it will not pose any serious threat to citizens of the United States. And if there were happen to be a detonation in the U.S., outside that zone of lethality it is survivable, if you seek shelter promptly. So we’ll leave it at those two comments. And, again, we can—we will provide these additional links to—where you can go into much greater detail after this seminar is over. FASKIANOS: Wonderful. Thank you so much. So we appreciate you both being with us, Andrés Gannon and Jerrold Bushberg. And again, we will send out the links to this webinar, as well as resources. Please, I encourage you to visit CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for more expertise and analysis. And you can email us at [email protected] to offer suggestions of other topics we should cover or speakers that could support the important work that you are doing in your communities. So thank you, again, for being with us today. We appreciate it. And we look forward to reconvening again. (END)
  • Cybersecurity
    Fortifying Cyber Infrastructure
    Tarah Wheeler, senior fellow for global cyber policy at CFR, discusses the bipartisan Infrastructure Investment and Jobs Act (IIJA) and ways to improve state and local government cybersecurity and critical infrastructure systems. TRANSCRIPT FASKIANOS: Thank you. Welcome to the Council on Foreign Relations State and Local Officials webinar. I’m Irina Faskianos, vice president for the National Program and Outreach here at CFR. We are delighted to have participants from forty-six states and territories for today’s discussion on “Fortifying Cyber Infrastructure.” Thank you for taking the time to join us. Today’s discussion is on the record. CFR is an independent and nonpartisan membership organization, think tank, publisher, and educational institutional focusing on U.S. foreign policy. CFR is also the publisher of Foreign Affairs magazine. And, as always, CFR takes no institutional positions on matters of policy. Through our State and Local Officials Initiative, CFR serves as a resource on international issues affecting the priorities and agendas of state and local governments by providing analysis on a wide range of policy topics. I’m pleased to be joined today by Tarah Wheeler. Her bio we shared with you in advance, but I will—I will give you a few highlights. Tarah Wheeler is senior fellow for global cyber policy at CFR, and CEO of the information security consultancy Red Queen Dynamics. She’s also had positions as a contributing cybersecurity editor at Brookings Institution, cyber project fellow at Harvard’s Belfer Center for Science and International Affairs, and very much more. She was also a U.S.-U.K. Fulbright scholar in cybersecurity, and she is the author of the bestselling book Women In Tech: Take Your Career to The Next Level With Practical Advice And Inspiring Stories. And I commend that to all of you. But today’s discussion is on cyber infrastructure. Tarah, thank you very much for being with us. Perhaps you can talk about there were some provisions in the bipartisan Infrastructure Investment and Jobs Act for strengthening cybersecurity and cyber resilience at the state and local level. It would be great if you could talk a little bit about that, and what officials should be thinking about when they get those funds, how to use them, how to think about cyber policy at the sub-national level, and how important it is in all of these communities across the country. WHEELER: Thank you so much, Irina. It’s just a real pleasure to be here today. As always, the Council on Foreign Relations is doing an incredible job making sure this information gets to the people who need it. And it’s a joy to be here with you all today. Thank you so much for the work that you do in our state and local governments keeping us safe. I am honored and humbled, and I hope I’ll be able to provide some context today and some of the fun esoterica—(laughs)—of the infrastructure act that we’re taking a look at today. I think the top thing that really crosses my mind as I first read it is, first of all, this is a bill sponsored by Rep. DeFazio, from my home state of Oregon. So good things always come from my beautiful home state. And I’m glad to see that this is certainly one of them. I’m glad to see that the Biden administration is focusing on improving our safety and cybersecurity infrastructure. So if you are running a state and local government—if you’re running, essentially, a non-federal government, as I think most of you already know, there are—there’s a grant program that’s coming out from this bill that was approved and passed a month ago. And there’s about a billion dollars that’s available over the next four years for you to apply for, to try to upgrade your cybersecurity posture, your stance. So the question is, do we all go shopping for purses, or do we figure out how to get some of this money allocated in a fashion that lets us really start to drive towards the challenges of local governments in cybersecurity. There’s really a lot of—a lot of questions people have been asking me about over this one. And maybe the number one thing is, should we be thinking about this on, like, a population level? Larger populations should receive a greater priority? Or should we be thinking about this sliced differently, kind of orthogonally, at a sectoral level? For instance, dividing it up amongst health care, power facilities, water facilities. Is there—is there a difference in that grant set and, for instance, tribal grants for cybersecurity and infrastructure? And it certainly does look like we’ve managed to separate this out into a really smart package of grantmaking not only bodies, but slicing it in multiple different, important ways. So if I were you, the first thing I would do is ask myself: Who’s giving me advice about how to spend this money? Because filling out grant applications is a time-consuming process, as I think basically everybody on this call already knows. It takes a lot of energy and effort to set this up, right? So are you applying for the right thing? The very first question I’m going to ask you is this: Have you asked the people inside your organization—whether it’s a municipality, a county government, a state government—have you meaningfully asked everybody in your organization the question: Is your work and home email password different? If you know, the answer to that question and you’re sitting on this call right now and you say to yourself: Yes, we’ve addressed the question of password sharing, of multiple account takeover, of business email compromise. We’ve fundamentally addressed that question, then we have a different conversation to have. I’m not actually sure if we’re able to do something along the lines of a poll in this Zoom or not, but I would sure love to see some feedback on this from you folks. It’s OK if we can’t but think to yourself this question. If you can meaningfully have visibility into whether or not your users have strong, unique passwords for every different account stored in a password manager or not, that’s the break point. If you’re not there yet, that’s where you need to get to. That’s the very first step, ensuring that you’ve got users using strong, independent passwords. That’s your first defense against not only business email compromise, but the growing threat of ransomware. It’s still growing. It’s still getting—the ransomware threats are still doubling every year, year over year, with really no end to that in sight unless we make some very serious changes. One of the key ways that ransomware hits systems is shared passwords. Now, if you’ve gotten to the point where you have meaningfully addressed the question of whether or not your users are using unique passwords stored in a password manager, your next step right after that one is multifactor authentication. Do you have your users using app-based multifactor authentication to have a multiple factor to log into accounts for state and local governments, for all the systems that you’re—that you’re administering? If you do, then what are you doing on this call? It’s happy hour time for you. Get out of here. You’re doing great, comparatively speaking. No, in all seriousness, those are really the two break points I see: Do you have visibility into passwords? Do you have visibility into multifactor authentication? After that, you can start going to topic-based areas in cybersecurity that are based on your threat model. So that’s really the question I’m going to have for you, and I want you to be thinking in those terms. At what level do you find yourself in that sort of hierarchy of cyber—the Maslow’s cyber hierarchy of needs on this one right here? And based on that, we can start with questions about how sort of we slice this budget and this grant up in ways that are most meaningful to you? Does that help us as kind of a starting point, Irina? FASKIANOS: It does indeed. So can you talk a little bit about, you know, state and local governments most notably have been the target of ransomware attacks in recent years. So the risks—what are the risks on not doing this? You know, on not having appropriate cybersecurity protection measures in place? WHEELER: So a couple weeks ago one of the most devastating data breaches, I think, honestly, in history, happened in Australia. In Australia, a couple of weeks ago Medibank was—experienced a massive data breach. And 9.7 million patient records—now, remember, Australia’s got a population of about thirty million people. We’re talking a third of the population. And when we talk about a population-level event, this is one of the most devastating I’ve ever seen. This is the full and complete medical records of essentially every single person in the entire Australian health care system. These records went to things like reproductive health, mental health treatment, substance abuse issues. And the data breach was—the full analysis will come out, but it looks to be a question of inappropriate protections over things like passwords—over unique passwords and over multifactor authentication. When we talk about why this matters, about why we’re trying to prevent ransomware, about why we’re trying to prevent business email compromise, ultimately what we’re talking about is either preventing the theft of or the denial of the use of the kind of data that you use to run your organizations. If you do not have these measures in place, you are looking at the loss of records in your organization in the case of ransomware, or the theft of records, in the case of a data breach. Those two things are very different. Which should you be most concerned about as someone running an organization that likely retains a lot of official data over the people in your—in your area of jurisdiction. Doesn’t matter if it’s a city, if it’s a county, if it’s a tribal government, if it’s a state. If you are somebody who’s running an organization that stores this kind of data, ransomware is intended to deny you the access to the systems that you’re running. Data breaches are intended to steal and then profit off of the use of that data, whether that is literally blackmailing people whose data you now possess, or in the case of ransomware the promise to unlock that data and make it of use again to the organization in exchange for a payment. Typically, in bitcoin, although monero is growing in popularity. It’s a pretty solid choice. Zcash is another really good one to use for anonymity. And if you don’t understand the things that I’m talking about right now, how you pay, stuff like that, I think there’s call to dive a little deeper into the machinery and the economics of how you pay ransoms and pay blackmail for data breaches. But really in this case, the two major things you can do are get to a point of visibility on where you stand in terms of your user data and your—there’s a difference between user data meaning the cliental you serve and your internal users in your organization. Your internal users in your organization need to have that strong, independent password with multifactor authentication in place. But at the point in which you’ve done that, your next question is: How many computers do you have? I’m genuinely—think for yourself. Think about the answer to this question. Do you know how many computers you have, how many endpoints are on your corporate, your organizational, your business, your government network? If you don’t know the answer to that question, that’s the next question after that one. The question of asset inventory is no longer a question that solely belongs to the IT function in your organizations. It’s a major question when it comes to cybersecurity to provide some kind of visibility into whether or not you’ve got rogue devices on your network. The question I think, Irina, I’m going to try to repeat back again a little bit here, like, what is the impact of these kinds of attacks? It’s either to make money or to cause embarrassment, and then to make money. Ultimately, this is—this is about you being farmed, if you are an easy target, for quick cash payments. And it’s being done by people who really, genuinely, don’t care about the people you serve. I do care about the people you serve. I happen to be one of them, for probably a chain of people trailing on up through a couple of states in this country. And I want to see you, believe me, as safe as possible, because that’s my data. It’s everybody’s data in this country. So, yeah, that’s our—that’s our next step. And I’m interested in the technical side of sort of the steps that you’re at, but there are really good and interesting questions about industry-specific and sector-specific protections that can be put into place as well too. So does that help a little on that question? FASKIANOS: It does. And would you say that you would need—that people should invest in a person within the organization, coupled with an outside firm, that would help us—you know, rather than trying to build it from scratch? Somebody—a consultancy, or that kind of thing? Like, how do you—what is—how do you scale this, or make this tangible, and implement this at the state and local level? WHEELER: How do you implement this at the state and local level? So, first of all, it’s a great question, because it’s both complex and a simple one. If you’re—if you’re somebody like me—I want to be cautious here, because this is what I do, also. I’m a—one of the reasons I’m having this conversation with you folks here at Council on Foreign Relations and became a senior fellow here is that this isn’t just what I write about, it’s what I do on an everyday basis. So my company provides this kind of service. I mean, to set that aside for a second—and I’m just going to try to make sure we’ve covered all of the grounds. It is highly unlikely that if you were an organization that has fewer than 500 people in your organization, that you will be able to bring in house even half of the cybersecurity expertise you need in order to keep yourselves safe. It’s expensive to hire cyber—qualified cybersecurity professionals. There’s a reason why there’s a third—why third-party and service providers are there. And that’s because, it has been my experience, that an FTE, a full-time employee, in cybersecurity, as differentiated from just the IT function, doesn’t get hired till about employee number 150 in almost any organization. Now, that’s different in extremely high-tech organizations, but most of who I serve have haystacks, not tech stacks. So it’s unlikely you’re going to be able to bring a lot of the expertise in house. One of the things I’ve loved, I’m going to bring a lesson across the pond for you. One of the things I’d love to see, the NCSC, which is the—essentially the equivalent of CISA in the United Kingdom—CISA’s the Cybersecurity and Infrastructure Security Agency here in the United States. One of the things I’d love to see the NCSC do is they certify third parties for incidence response and cybersecurity provisioning at consulting. Which it doesn’t mean they recommend them. It just means they’ve passed a series of bars that says this organization is worthy of trust. You can go to them, and we know that they’ve handled incident response issues before. So I would love to start seeing something like that in the United States. I believe that moves are being made in that direction. I’ve heard of the possibility of that happening, of getting a little bit more of a sort of cyber civil defense force a little bit, if I can borrow, you know, kind of Craig Newmark’s phrase that he’s been talking about for a while. But just the idea that there are trusted third parties you can go to who have at least been rated and evaluated to give you—to give you a hand. So, yes, the service providers are out there. There is a wide range of skills and capabilities out there in third parties. If you ask smart people on the internet, they’ll give you good people to go to. And I want to be—I want to just be very cautious in how I phrase it, I’ve seen a lot of very good and very bad service providers. So when you go and evaluate them, make sure and have somebody who is also a trusted IT or cybersecurity provider, who’s not going to be that person, do an evaluation of who you want to engage with. They should have several things that you should find when you look at them. They should have a bunch of people who are qualified, and those qualifications can take a lot of different—a lot of different sort of—they can be manifested in a lot of different ways. I don’t mean college degrees. I mean people who demonstrate through their care, willingness to educate the public, that they are people who can and should be trusted with critical infrastructure. People who have the respect of the industry are a good fit. There’s a lot of wonderful cybersecurity third-party providers out there. And I want to be cautious not to just sort of also name all of my friends on this one too, but if you look for the helpers, like Fred Rogers says, you’re going to do—you’re going to do just fine when you find somebody locally. Now, I can also provide a recommendation if you get stuck and you don’t know what else to do. You can find four people. Look for your local college. And whatever respected college is a hundred miles away from you or less. Look for, you know, a research one university. Look for whatever state or tech university is near you. I went, by the way, to Portland State University. Go to Portland State University. That was where my master’s degree was. Go talk to the chair of the computer science department. Ask the chair of your computer science department to help you evaluate someone. Go look for your local ISC, or ISACA, or ISSA chapters. Those are information security professional associations. And ask someone from one of those chapters, perhaps the chapter president, to help you find a third-party provider. You can also go look for somebody in government. The CIO and CTO of most states have a pretty good feel for who in-state third-party providers are. And they often maintain an ad hoc list of who those people are, and who those trusted providers are. And finally, take a look and find out inside your organization, if you did a brief poll, if anybody knows people in information security and information technology, where they would go to ask for something like this. Those are four sources of good information you can go to, to ask for trusted providers as we wait for some kind of certification process for cybersecurity third-party providers for you. Does that help a bit? FASKIANOS: It does. So I’m going to ask one more question before opening up to the group. And, please, we’d love to hear not only questions, comments, and you can share what you’re doing in your community as well. So this is a really good time. We’ve found that people share across municipalities and it’s been very helpful. So at the top, you mentioned what kind of grant are you writing. So if you know the answers, you know, the passwords and all of that, great. But the second part is, if you do know that, then what is the other thing that you should be looking at? How to focus on cybersecurity at a—you know, at the different issues and sectors. So can you talk a little bit about that second part of what you mentioned? WHEELER: The hardest part of this is not just doing it as a one-off. It’s not just kind of once a year or once every two years in a cycle writing essentially a book-length report on how you find yourself doing, your stats, your sort of point-in-time perspective on how your cybersecurity is doing. Your hardest job at that point is to maintain continuous compliance integration. That continuous process of repeatedly fixing small things and nudging your security posture upward, that’s the next step. For that, even if you can’t hire somebody internally, or you can’t get the, eh, quarter-million dollars it’s going to take to hire a good, qualified person at a state and local level to come from private industry and run that program for you, you can take a tenth of that amount and start to get in the habit of asking a few questions every week or two that let you check on your cybersecurity posture and just do one or two things at a time. Keep that continuous process in mind and find somebody who’s willing to be your security champion internally. If you’re a thirty-person organization, find somebody that you can give a small pay bump to and give them the checklist that lets them figure out what’s going on in an ongoing basis and make that part of a quarterly report to you. Just start to decrease the amount of time that you go between those checkups to find out how you’re doing. And if there is absolutely nothing else that you can figure out how to do, and you have no money to do any part of this, you get denied for every grant, just do one thing for me. Turn on automatic updates on every machine, everybody’s phone. Most of you folks, if you’ve been issued a government phone—it could be an Android, it could be an iPhone. Turn on automatic updating on your phone, and the next thing you do right after that is turn on automatic updating on your Windows or Mac machines. You’re probably on Windows machines, I’m going to guess, many of you. Turn on Windows Defender, and don’t ignore the prompts if it tells you to do something. Yes, I know it takes forever to do the update cycle. That’s the thing that’s going to keep you the safest, automatic updates. If you can’t do anything else, do that. Keep your patches up to date. FASKIANOS: Great. Thank you. I am going to open it up to the group, and then we can continue talking. But I really don’t want to—I would like to get to the questions. And you can—we would love to hear from you. And do not be shy. And if there are no questions, I will—that means that you’ve been—you’ve been so thorough. (Laughs.) So if you want to ask a question, you can click on the raised hand icon, and accept the unmute prompt when I call on you. And you can also write a question or comment in the Q&A box. And if you do that, please include your affiliation there so we know what state and where you’re coming from. It just really does help give everybody context. OK, so the first question, raised hand, is from Gail Patterson-Gladney. And please unmute yourself and tell us who you are. Q: Yes. Hello. I’m Van Buren County commissioner. I served for six years and just recently got reelected. And before I served as county commissioner, I worked for the city of South Haven. And I was told in a conference in the Michigan Municipal League that we should not use our personal cellphones for our emails. In the county, it seems to be different. We can go ahead and open our phones and use our emails. Which is the safest way to use our personal phone? WHEELER: That is such a great question. Thank you so much. And congratulations on getting reelected, Gail. Nice work. (Laughs.) So this is the—this is the way I would proceed on that one. It’s a hard question, because I understand the lack of budgets that can lead to you not being issued a phone to conduct work business on. And if you’ve been expected to use your phone, your personal phones, to get your work email, one of the most important things you can do is, like I said, make sure that your passwords on your work and home email are different. And I want to make sure that I’m very clear on that one.  The password I’m talking about isn’t the one to get into your phone. It’s that you’ll set up two different email accounts on your phone. Don’t forward your work emails to your home email address. And open only those home emails on your phone. Does that make sense? I want to make sure that I’m clear. And if I’m saying something you know, I’m so sorry. I just want to make sure I’m clear on this. Does that make sense, first? Q: You said don’t forward your county emails to your personal accounts, like Gmail or Yahoo accounts? Like, personal ones? WHEELER: Yeah. Make sure—yeah, don’t forward your work emails to your personal address. So, for instance, like, my email address might be [email protected]. And when I view my [email protected] emails, even if I’m looking at them on my personal device, I’m not inside Council on Foreign Relations forwarding those emails to [email protected], and then only opening up the Gmail app, and reading my tarah@gmail(.com), and seeing the forwarded emails from my work email. Don’t do that. Does that make sense? Q: Yes. WHEELER: OK. The thing that you do is you go into settings, whether you got an Android phone or an iPhone. You’ll go into settings—let me see if I can just find this real quick. So there’s going to be—there’s going to be a setting in here. It’ll be called general—or it’ll be called—you’ll see where there’s probably something in here called “mail.” So, yeah, inside your iPhone there’s going to be—or in Android—there’ll be a setting called “mail.” And what you need to do is you need to go to this thing right here—see if I can just cover this up a little bit—you’ll see “accounts” in here, OK? Make sure you got two different accounts in there. One’s your work and one’s your home. So you want to make sure that when you’re logging not your work emails, that you’re seeing your work emails as a separate account than your personal emails. I hope that makes sense. And, you know, we can also put a blog out there to help people understand that a little bit better. But the thing that we’re trying to do is make sure that you don’t mix all of those emails up together in one big data pool that’s on your personal email, so that if someone breaks into your personal email, they can see all your government business. Does that make sense? Q: Yes, except for I thought because I have two different email—let’s say I have my government Gmail and then I have my personal Gmail. I thought that separated them enough when I bring up Gmail. WHEELER: So, OK, it depends on how you have your phone set up. But the thing that we want to make sure is happening is that you have two different accounts set up on your phone, as opposed to you forwarding all of your work emails to your personal email address. And if that’s not clear, I want to make sure we got enough time to answer everybody’s questions, but, Gail, also if you want to I’ll help walk you through that. Yeah, and what we’re trying to do here is make sure that if you lost access to either one of those accounts, it wouldn’t mean that you lost access to other. So that’s what’s really important. Now, ideally—in an ideal world, you’re being issued a work phone that you just have work stuff on. Let’s be realistic. Most people aren’t busy getting a $1,000 iPhone for their jobs, right? So that’s the ideal, right? And we’re not sitting in Silicon Valley here. So you’re probably being expected to answer work emails on your personal device. And just making sure that when you have your work emails that you don’t have a setting in your work web or email client that’s forwarding those emails to your personal email address. And we can go into that a little bit more later, but your IT person can probably make sure that you have two different accounts set up on your phone. If you have two different accounts, and you’re viewing them separately, you’re as good as you’re going to be in this situation. Q: OK. Thank you very much. I’ll check with my IT person on that too. WHEELER: Wonderful. FASKIANOS: OK, I’m going to take the next question from Danielle Schonbaum, who’s the finance administrator of Shelby County in Tennessee. And Danielle had a raised hand, put it back down, and put it in the chat. But I would love—we’d love to hear from you directly. So if you want to accept the unmute prompt, that would be great. Q: Sure. Hi. Danielle Schonbaum, Shelby County government. I was just curious about any thoughts you had on cyber insurance. GFOA magazine had a pretty extensive article in the last month or so about some of the pitfalls of cyber insurance and, you know, what it really covers. So just— WHEELER: Well, do you want my thoughts, or do you want my opinions? Because my opinions are funnier, but we should probably start with the thoughts. OK, so the first thought I have here is that cyber insurance is incredibly important. And here’s the reason why: Cyber insurance is really the first sort of attempt that the finance and international regulatory community has really made effectively to price the risk associated with doing cybersecurity poorly, or inappropriately. After the creation of fire insurance, home fire insurance, the number of house fires in this country dropped massively because fire insurance companies figured out very quickly that they could incentivize with their pricing homeowners taking certain steps. Like, making sure that their stoves were located away from the house, or fully tiled, or moving to—away from open flames and open gas flames, to contained sources of light and heat. Moving to baseboard heating away from radiators, that kind of thing. So the insurance company figured out what that risk would look like for a homeowner. And they managed to make it expensive to make choices that were more likely to get you burnt down, and cheaper if you made choices that were less likely to get you burnt down. Cyber insurance is the very beginning of that process right now. If you make choices, like having automatic patching turned on, or using multifactor authentication, or certainly in the case of Gail where you have different devices where you separated out work and home email for people who are employees, those choices mean that cyber insurance programs are going to price safer choices cheaper. So there’s a lot of different providers out there, and it’s still kind of a wild west situation with it. But that’s really important, that they’re doing that. And beginning to stick an actual number on the value of making certain kinds of choices in cybersecurity is the real value of the cyber insurance industry. Are they good at it yet? Some people are better than others at it. I’ve walked clients of mine through the cyber insurance application process before. And the checklists are still really, really—they’re very basic still. They’re still asking questions like, “What kind of encryption do you use?” That’s not a meaningful question for a thirty-person accounting firm, right? Because you’re using Office 365, or you’re using Google Apps, or whatever you’re using. And the answer is, I mean, I guess we use some? There’s a green padlock when I look at my computer, right? That’s the answer to that question. And it’s not that the people who are answering these questions are dumb. It’s that they have a different skill set than those of us who are answering these more specialized questions in cybersecurity. And sometimes the people who design these questionnaires in cyber insurance are sort of copying the patterns they used from homeowners’ insurance, and rental insurance, and auto insurance, without realizing this is a really different world. There’s no independence of risk in cyber insurance. And what I mean by that is, if you house burns down that doesn’t mean your neighbor’s house burns down, even if they have the exact same house and the exact same floorplan, right? In cyber insurance, two different clients who have the same, essentially, floorplan, the same network, the same updates, the same vulnerabilities, if one of them gets hacked the other’s probably going to get hacked as well too. Which means that a cyber insurance company has to figure out how to price risk not only for a single entity, but across an entire spectrum of an industry that likely all has the same version of the same kind of software all the way through it. So that’s the problem we’re tackling. And people who are evaluating businesses and organizations for cyber insurance, are still not really good at understanding independence of risk. A good example is, like, hurricane or flood insurance. If you get flooded, your neighbor gets flooded. There’s no independence of risk in that. If you experience a hurricane, so does your neighbor. House fire’s different. So’s flooding based on plumbing issues in a single-family dwelling, right? I think you can understand kind of the concept we’re going for. So cyber insurance is serving a valuable function. They’re starting to get to the price of real risk. But they’re not good yet at calculating independent risk for individual applicants. I hope that’s useful information for you. FASKIANOS: Great. Thank you. I’m going to go next to Isabelle LaSalle. I don’t know if you want to ask your question that you’ve written, Isabelle. I’ll give you a few seconds to unmute if you’d like. Otherwise, I will read it. And, yeah, and tell us who you are. Tell us who you are. Q: Hi. My name is Isabelle LaSalle. I’m a legislative assistant with the California State Assembly. I was just wondering if you had suggestions for steps that state legislatures can take to improve cybersecurity at the statewide and at the local government level. WHEELER: The CCPA of 2018 did more to make cybersecurity a thing on people’s minds than almost anything else. If you were there getting that being kicked through, thank you for your service. So the California Consumer Privacy Act of 2018 means that people now have to pay attention to what’s happening with data on California citizens, California businesses, anybody doing business in the state of California, data passing through California. It’s basically GDPR for California. The CCPA and the requirement now that companies put a privacy policy that clearly states how they’ll handle privacy policy and data requests from the general public on their website is the thing that’s backing most of these people up into saying: How do we know somebody’s data is deleted if they ask us to do it? And that right there, that question is doing more for most small businesses and most companies than you can possibly imagine. So you can just take the week off. You’re good. But genuinely, seriously, for those folks who are looking to find a way to spur action in their organizations, realize that if you’re storing information using a California company on a California citizen, doing business, storing anything in California—and, let’s be honest, much of the tech industry is located in California. Which means you should probably just do this right now. That’s the question that’s going to get you action because it needs to be public facing and it needs to be true. If you say that someone can send us a request and within sixty days we’ll respond, and within ninety days we will guarantee your data deletion, you better be sure that you are deleting that data. That gets you into what really matters, which is your data security and retention policy. So what can legislative assistants, what can—what can legislatures do across this country, what can anybody do in this particular case? Ask people if they understand whether or not data is getting deleted when you think it is. That is not a trivial question. It’s a technical, interesting question that backs up into heavy-duty applied physics and engineering in my field, in computer science. It does come down to sort of, like, what’s a practical definition of deletion? And there’s a couple of good working practical definitions out there, which is beyond the scope of this conversation. But there’s good definitions of data deleted, we’re pretty sure we’re good going forward from this point out. If you can get to that point, you have started to abide by really the spirit of the law, as well as the letter of it. And the CCPA of 2018, incredibly valuable bill. Thank you very much to the entire state of California for giving us all that kind of lever we need to have those conversations with people. And it can just start with, hey, we’re supposed to have a—we’ve got three employees in California. We’ve been storing data there in a data center. We know we’re supposed to have a privacy policy out by law, right? Otherwise, we could get into some trouble. So use that as a hammer when you need to. FASKIANOS: What other—can you cite other examples of states or municipalities that are doing cyber well, that you would—you would, you know, cite for other states and governments—local governments to look at? WHEELER: Two things. Colorado’s also passing a data privacy law. And some time back New York passed new regulations at DFS that meant that they were—they’re really closely losing at how data is stored, protected, and deleted. If you know what’s happening with your data, you’ve gone past the question of sort of user passwords, of multifactor authentication, of asset inventory, and you’re into the real, serious question. Which is, what are we doing with all this information we’re collecting? There’s—I mean, there’s not many state and local governments doing this really, really, really well. And nobody’s perfect on this one. California’s law in 2018 is a very useful one. And the truth is, that it makes a great deal of sense wherever you are in the United States to just abide by that, because it’s by far the most stringent one. So just start there, and you’re good pretty much every place else. It’s going to be important to see those laws passed, but the truth is we need to see a federal law. And if the—and if the federal government passed, honestly, a version of that CCPA 2018, we’d be in pretty good shape. Basically, all companies right now are squeezed between GDPR and the CCPA. And if you abide by both of those things, you’re doing pretty OK. Just because you’re a nonprofit or state and local government doesn’t mean you shouldn’t be doing those things. It just means you probably have a little bit more exception, wiggle room. Don’t take the exception. Try to do it right, if you can. And the answer is it’s hard to get this stuff through. There’s a lot of lobbyists that don’t want to be told what their companies can be doing with your data, right? FASKIANOS: And how likely is it that such legislation will be passed at the federal level? Is that—is that in Congress now? I mean, is—and is there bipartisan support to things that you can tell—you can talk about that? WHEELER: So there’s, in general, always a version of that privacy act sort of running around and trying to get—trying to get through. I couldn’t speak to the current state of what that looks like. And that’s mostly because, it’s my understanding—I’m not a congressional specialist in any way, shape, or form. But it’s my understanding that now with a split Senate and House, there’s less possibility of bipartisan legislation being passed in terms of privacy bill. But I will leave that up to the congressional scholars to address. The answer is, yes. Almost all the time there is a pretty good—a pretty good version of the bill, and a pretty terrible version of that bill, always sort of getting duked out in subcommittees. FASKIANOS: What would you say officials should be doing to raise awareness with their constituents of the importance of strong cybersecurity protocols? WHEELER: I’m not sure how much constituents need to have their awareness raised. This is—it’s sort like—it’s sort of like saying you need to raise the awareness of constituents about pollution, right? Like, we know. We pick up our own trash. But, like, what do you expect us to do about a river by ourselves, right? So I’m not sure how much the individual constituent can do about a river. If they have also the same strong different passwords and multifactor authentication, and they know how many computers are connecting to their home network, they’re already kind of doing what they’re supposed to be doing. At this point, it’s on you to start protecting them. So that’s a responsibility we’ve sort of taken up at this point. It’s a hard one, but awareness in this case, the thing I would say to not do is throw scare numbers at people. We already know what data breaches look like. Honestly, a lot of data breaches are—people get notified of them again and again, and it’s creating fatigue in them. Maybe instead of raising awareness, we need to be able to raise the sophistication of the conversation, especially at the state and local government, to raise confidence—not necessarily awareness, but confidence—in constituents that people are at the helm who know what they’re doing in cybersecurity. So set an example more than raise awareness, is a good way to put it. It’s a hard—it’s a hard task. But if you can do that, you’re doing the right thing.  FASKIANOS: And you have written that some of the money from the package will go toward establishing new Office of the National Cyber Director. So if you were advising that office, how would you suggest that they interact with state and local officials? And how would you want state and local officials to be engaging with that new office? And what’s the timeline for that office to be created, by the way? WHEELER: Well, the Office of the Cyber Director, if I’m correct, if we’re talking about Chris Inglis and the OCD is Office of the National Cyber Director, I’ve seen that $21 million allocation in there. They’ve done a wonderful job getting set up to have conversations about capacity building. State, local, tribal governments are all receiving some attention as we start to pay attention to grassroots-level building of cyber capacity. How would I advise them? I wouldn’t presume to. There’s some very smart people who are doing that work—Kemba Walden, Rob Knake, Chris Inglis, Camille Stewart Gloster. These are incredible and smart people who are doing this work. I think Camille is focused on workplace and cybersecurity capacity building. And how would we engage? I think they’re getting ready to start—sort of state taking more intake from the public, but they’re also beginning outreach programs. They’re just getting set up, right? This is—this funding, I think, was only approved as of a month ago. So I will look forward to see how they’ll develop a portal out for you. And I would imagine it’s going to be some way of taking information in and disseminating it as well. So the answer is, I think they’ve got to figure out where the light switches are first. FASKIANOS: And I will just note that Rob Knake used to be a fellow here at CFR. We were sad to lose him, but he—our loss and the government’s gain, for sure. WHEELER: Absolutely. FASKIANOS: I want to give people—yeah, absolutely. (Laughs.) I want to give people a last chance to ask questions. I have one more while we’re waiting for something to queue up. Do you think that the—that enough money has been appropriated to tackle this problem? I mean, is it a realistic amount? Or is it just a drop in the bucket? And you did mention—you said, how are we doing it? Allocating it by population, or needs, or whatever. I mean, what is the best path forward to sort of get these funds allocated in a strategic manner? WHEELER: Mmm hmm. I’d say that’s a great question. Before I start in on that, I want to just tell the folks in the room right at the moment, whatever your IT questions are—I loved Gail’s question earlier about how do I—how do I, you know, answer these questions on my personal device. If you have—like, I’m the IT person for a bunch of folks, right? Like, not just mom and dad. So if you have questions and you want to just take a minute and ask those questions now, can I just promise you right now there is no such thing as a dumb question. The only question here that’s problematic is one that you don’t ask when you could have asked now and gotten a quick answer from somebody. Please ask your questions. It doesn’t matter how—literally, where is the setting on my watch for this? Where do I click on my computer to fix the thing? Ask me. This is what I do for a living, so I am more than willing to help. And there is no dumb questions on any of this. You could also—do absolutely feel free to contact me. I think Irina’s going to have information up. I’m more than happy to just answer questions for you, if you want to. It’s completely fine. This is—this is fun for me. So but the question about whether or not—Irina’s, it’s, like, such a great question. Like, is this enough money? Is it too little? Is it too much? It’s like asking if the EPA has been allocated enough money to fight pollution. The answer is that it’s always going to be both enough—it’s always going to be too little or too much. And the reason why is, either it needs to be optimized someplace else, or it—the amount of money is enough to get started on something, but not follow all the way through with it. So the complexity of government budgeting—what do I know? I’m just a hacker. I couldn’t put together a government budget for you. But I can tell you, the complexities of that are beyond me personally. I would say that a billion dollars for the kinds of grants that need to be allocated at the state and local level, that’s enough money to fix three of your problems each, right? You could fix a couple, two, three, problems at that level. You can get $25,000, half—you know, a quarter-million dollars. You can get enough money to fix, like, -ish a few problems. It’s not enough to fix all of it. And I hope at least part of what comes out of this is not that you are fixing these problems by yourself. What I hope comes out of this grant process is a continuing collaboration with, what’s most important of all, networking with other people who are experiencing the same problems so that you can get an economy of scale in fixing these problems. So that you can collaborate on solutions. So that you’re building capacity not just technically but in your human capital, so that you learn these things and can share them with everybody around you. If this is implemented in that fashion, each one of you solving a few of these problems and sharing that information amongst every one of the people that you’re put in touch with, that does start to become a meaningful solution to the problem. And for that, there’s enough money to do that. There’s not enough money for all of you to fix all of your problems on your own without talking to anybody. You’re muted, Irina. FASKIANOS: Oh, your comment elicited a few questions. So from Patrick Whalen (sp). Patrick, do you want to unmute yourself? Or I can ask it myself? Q: Hello. Yes, thank you. My question, as I typed it out, may be a little confusing. But you mentioned not using scare tactics and statistics and numbers in discussing these subjects with constituents. And I wonder if you’d recommend a similar or different approach internally within offices? You know, I kind of get eye rolls when people see what my passwords are and just, you know, a mash of numbers, letters, and symbols, and that I change them trimonthly or bimonthly, you know. It’s kind of seen as alien. And so bringing up this subject internally—strategies, suggestions you have for that. Thank you. Very informative talk. WHEELER: Absolutely. Thank you so much. I appreciate it, Patrick. So, first of all, what I’m going to recommend is the guidance on changing your password quarterly has been updated at NIST. That’s the National Institute for Standards and Technology. The guidance at NIST has been updated to you don’t need to change your password quarterly. What you need is a super solid, strong, long password, paired with multifactor authentication. Changing passwords continuously is how you get passwords like summer22!, autumn22!, winter22!. Like, that’s how you get those passwords, and why that password process is really commonly associated with a lot of breaches. And it’s because very few people will change their passwords and store them in a password manager if they’ve got to change them that quickly. Or they won’t maintain them well. The guidance is to get people onto password managers at this point. There’s a lot of great passwords managers. LastPass. I personally use 1Password, because I can have a family vault that I share with family members, with my spouse. We can share, like, some financial passwords that are required. And they’re stored along with the ability to get to those devices that give us multifactor authentication, whether that’s a security key or an app-based authenticator. So how do you—how do you get to a place where you’ve advocated for this? Well, first of all, don’t advocate for the password changes. Advocate for password managers, not password changes. How do you get the attention of people internally? We are all in situations where everything’s burning down all the time. Those of you who are dealing with local governments that have municipal hospitals have nothing but problems all day long. And I see you and I feel for you and I sympathize for you. You’ve got devices inside local critical infrastructure that haven’t been patched in twenty years. And they are wildly vulnerable to all kinds of different attacks that—I mean, honestly, that’s the kind of stuff that we teach at the kiddie village at my information security conferences at this point. That’s how we get the kids started on hacking. So this—you’ve got—you’ve got a target-rich environment that you’re trying to protect, and nobody’s really helping you. Until now. I think genuinely there’s been a real sea-change over the last five years. And when you see the work that’s coming out of the National Cyber Director, coming out of CISA. If you need help with your administration to get attention on these issues, go to some of the latest guidance from CISA. It’s getting better over time. They’re doing a great job getting some of these advisories out. They’re still at too high a technical level to be of a great deal of use to your leadership, but hopefully you can translate it a little bit more for them. And if you can’t do that, find somebody who can, and get you to the level of, like, a football analogy or a cooking analogy, and that will help at least a little bit. You’re in—you’re in a tough spot. And there’s not a lot of money to solve these problems. If you can’t do anything else, get your executives to take a look at the most vulnerable members of the constituency that you serve, and ask yourself: If the most vulnerable members of your constituency are served by devices that are also the least updated and the least cared-for in your constituency. If the poorest people in our communities are being served by the most outdated machines at the local library, and the kind of terrible run-down sphygmomanometer, and, you know, the blood pressure thingy, those devices are the least cared for the and most out of date. You can at least tell your leadership that there needs to be an investment in the people in your community that need that help the most. That can be the way that you get a little bit more buy-in, and it give them that kind of air cover that they need. And then go get $25,000, go get $100,000, go get a million dollars to update the devices and the technologies that serve the people in your community that need it most and will likely understand it least. Chances are fairly decent, it’s some of your executives as well. FASKIANOS: (Laughs.) Excellent. Let’s see, there’s a new question from Stephen Courtney (sp): How do you feel about using biometrics or physical security tokens for access? WHEELER: Biometrics or physical security tokens for access. So there’s a thing that we talk about when we talk about authentication. There’s a thing that you know, a thing that you do, a thing that you are. A thing that you know, a thing that you do, and a thing that you are, are three different elements of authentication. A thing that you know could be a password. A thing that you are could be biometrics. And a thing that you do can be a process of a second factor, for instance, like a token for authentication. If you have a thing that you know, a thing that you are, and a thing that you do, and a thing that you are is involved with biometrics, it’s a thing that can’t change. So you want to be very cautious about using biometrics, because it’s a thing that is intended to be unique to a person, but once the information is leaked and can be duplicated, it can never be changed. You can’t go back from losing somebody’s retina scans and DNA. You can’t go back from losing somebody’s thumbprints as image files, if you’ve been storing them. Be incredibly cautious about that. Now, there’s a lot of very good, technical implementations of multifactor authentication that involve app-based authentication, they involved a physical token or security device. Like—hang on for a second here—this little guy right here is my YubiKey. I use this to authenticate myself—I know, it’s kind of teeny, right? You can barely see the little guy. FASKIANOS: How do you keep track of that? Oh my goodness, I would lose that! (Laughs.) WHEELER: It just stays plugged in. It just stays plugged into my machine all the time. FASKIANOS: Oh, OK, good. WHEELER: So there’s a lot of—there’s a lot of options. And, yeah, you can have those—you can have devices like this that can be permanently there. And what that device means is that if somebody asks me for my physical authentication, if I kind of touch that little thing and the string of letters matches what my app is expecting, they know I’m at my laptop. That’s my laptop key. Or, they at least know that I possess this, if I go plug it into a different laptop. Somebody who doesn’t physically have this key on them can’t get into stuff like my financial accounts. So are there problems with it? Sure. But is this a pretty good choice? I mean, this is what I have my parents do. So it should tell you something about what your options are. Don’t use retina scans, and fingerprints, and DNA. Just don’t use them. But use physical tokens as an option. FASKIANOS: Now I’m worried because now global entry is with a fingerprint. And CLEAR is with an eye scan. (Laughs.) So are you saying not to use those? Are those safe? WHEELER: I use CLEAR, yeah. I’m saying that—I’m saying that we have absolutely no choice about those. Don’t implement them if you can possibly help it. I don’t like it. But let’s be honest, the airport is an incredible coercive environment. There’s no—for all intents and purposes, you cannot not consent to anything anyone ells you to do in an airport, or you can, I don’t know, be locked in a tiny cell. Who the hell knows at this point, right? So be cautious about that and implementing stuff like that. Because once that genie is out, it’s out. And yeah, you pretty much need to use facial recognition to get in and out of this country at this point at any checkpoint. Can you opt out of it at gates walking onto an airplane to London? I’ve opted out before because I’m stubborn as hell and I want to see what happens. And the answer is—the answer I get from gate agents, they’re like, I mean, it’s fine. We just took your picture anyway. And they’ll wave me on. No passport. I’ll be like, but I opted out of facial recognition. And they’re like, I mean, what do you want me to do, look at your passport? I know who you are, Ms. Wheeler. So the answer is it’s already there. Don’t be the person who does it again badly and loses it. FASKIANOS: Got it. So if somebody, you know, I have two practical questions. If you—you know, we all know now clicking on links is a terrible thing and it can unleash some very bad things. If somebody within your agency clicks on a link, what should—what should be the next step? And then the second part is, if you have a ransomware attack or you are being ransomed, where should local officials go? What should be the first call that they make if they’re getting—if they have that situation happen? WHEELER: These are such great questions. There are two—there are two complicated questions. So I’m going to—the first question is what do you do, and the second is who do you call, I think. So the first question—clicking on links isn’t terrible. That’s the internet. You literally—that is the internet, Irina. Like, clicking on links is a good thing. It’s wonderful. If someone you don’t know send you a link in an email from an external—by the way, one of the best things you can do is turn on that little external email notice. If you have your local IT person, have them turn on the notice that says: This message is from an external source. If you don’t know what I’m talking about, go find out and fix that thing. That is absolutely a thing you can fix, and it’s a big defense against clicking on links that you’re like, oh, I feel like I know a John Smith from where the hell over in the next office. You know, I’ll check out what he’s sending right here. Somebody sends you a link that’s like final quarter, you know, executive salaries.xls, do not click on that. That’s never the salaries. It’s never the salaries. So if you click on something, do let your IT people know as soon as possible. But here’s the thing, there’s a lot of stuff in the media that shows sort of somebody clicking on a link and then somebody in a hoodie in the background—you know, that’s me, by the way. I’m the one in the hoodie—you know, typing away frantically, trying to break into your computer as you tapped on the thing. And if you just close the link quick enough like, oh, dang, I can step back and you see, like, somebody slams the lid of their laptop shut. Oh, we defeated the hackers. Thanks. That’s not how any of this works. (Laugh.) The second that you click on the link, the payload has been delivered. It’s done. It’s over. There’s no—there’s, no, oh, I should just close this popup really quick, and everything’s fine. It was only open for a couple of seconds. It’s probably fine. No. The payload has either been delivered or it has failed, and it happened the second that you clicked on the link. Or that the mail client that you were in evaluated the link to try to preload it for you clicking on it. So don’t worry about that second thing that I just said, just trust me on this one. If you click on a link, it’s over. It’s done. There’s no—there’s no kind of a little bit there. There’s no quick just shut it down. The second that the link gets clicked, the payload has delivered or it has failed. Doesn’t matter what you do at that moment. You do need to go talk to your IT person right away. If there’s one thing that you can do it is isolate your computer or your device immediately from the network. Turn on airplane mode. Don’t shut the computer down. Turn on airplane mode and remove it from the internet as fast as you can. That is different. That’s about the amount of data that can be transferred off of your computer. No whether or not the compromised happened, but about how much they can get from you. It’s, like, the bank has been broken into. That state has already been achieved. How much money can they get out, right? So this is what you’re doing. You can’t stop—they’ve already broken in, but you can slam the vault door shut. You must speak to somebody as fast as you can and get your computer cut off from the internet. That’s going to vary a little bit from person to person and from organization to organization. But please go ask your IT people what to do in the event, and how to turn on airplane mode or get your computer unhooked from the internet. If you’re not sure what to do, there’s a little Wi-Fi symbol probably at the top or at the bottom of your screen right now. If you click on that, you’re going to be able to see something probably called Wi-Fi settings. Click on that, and you’ll be able to—I’m trying to make sure that I don’t actually go offline right now—but there should be something in there that says airplane mode. Do that, and then if you also have a—it’ll look like a network cable, right? A little ethernet cable. Yank that right away. Then go talk to somebody. Not using your computer but go talk to somebody and find someone who can help you with that. That’s the first thing you do. The second thing is who are you going to call when this happens, if you’re an organization and you’ve experienced a massive attack? There’s a lot of—there’s several different answers to this question. The FBI has field offices that you can report this to. Be aware that the FBI is a law enforcement organization. Their job is not to protect you or keep you safe. Their job is to solve the crime of how this happened. And so they may be more focused on who the offenders are, how this happened, do you have evidence? And they tend to be pursuing this from the perspective of someone who’s trying to figure out if this is in their jurisdiction and if they can figure out who to go after. I would highly encourage you to report immediately to CISA, which is the organization—it’s not a law enforcement organization. This is the Cybersecurity and Infrastructure Security Agency. They also have field offices. They can’t necessarily dispatch incident response to you right away, but they can provide guidance about what you can do next, provide references, referrals, and technical guidance for people who can help you get yourselves set back up again. It depends on what you need to do and how quickly you have recovered from this, and if you’ve recovered from it. So the answer is, basically, FBI field office or CISA. It depends if you are a regulated organization. Maybe you’re health care and you need to report to HHS. That’s also very possible. They’re a regulatory body, so they can both help you and possibly penalize you. There’s a lot of weird incentives in our government. We’re working on it. So whoever you talk to, just be aware there’s a spectrum between can advise but can’t prosecute or regulate all the way over to can after the criminals or can regulate you depending upon what the nature of the breach was and what the level of responsibility you have for it was. It's a complicated question. It’s getting a little easier. And there’s starting to be a bit more of a cyber 9-1-1 at .gov. And I would highly recommend, of course, if any of you are not on the .gov system, that will give you a bunch of resources as well. If you are a state or a local government and your website is not on .gov as opposed to .com, .co, .org, whatever, go get on the .gov system. You’ll get a bunch of resources that will help you out with that, and where to go. FASKIANOS: Great. Thank you so much, Tarah. This was fantastic. And to all of you for taking part. Again, if you have questions, you have Tarah here who’s willing to answer them. She’s a fantastic resource. We’re so happy that she’s joined CFR. And obviously she’s still very much running her own company. We will send out a link to this webinar and the transcript. You can follow Tarah Wheeler’s work on CFR.org, on Twitter at @tarah. Very easy to remember. And as always, we encourage you to visit CFR.org, ForeignAffairs.com, and ThinkGlobalHealth.org for more expertise and analysis. You can also email us, [email protected], to let us know how CFR can support the important work you are doing. So wishing you all happy holidays. We will reconvene in the new year. So enjoy the holidays and happy new year in advance. Thank you again, Tarah. WHEELER: Thank you so much. It was absolutely wonderful. Thanks so much, Irina. It was a real pleasure. (END)
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