Remarks at the Virtuous Circle Conference

John Kerry
Secretary of State
Palo Alto, California
October 10, 2016

MS BOYD: So, Mr. Secretary, welcome to Silicon Valley and thank you for joining us today.

SECRETARY KERRY: Happy to be here. Thank you.

MS BOYD: I’m going to dive right in because we have a little bit less time than we planned. And I wanted to start with the big news from Friday. And since so much news broke on Friday, I should probably be a little more specific. (Laughter.) So on Friday, the Obama Administration officially declared that it believed that Russia was behind the hacking of the Democratic National Committee and other institutions, with the specific intention to disrupt the U.S. elections. What you can you tell us about that?

SECRETARY KERRY: That you don’t know already? Well, let me first of all just say thank you for the privilege of being here. And I’m really happy to have an opportunity to share some thoughts with everybody about what the State Department and the Administration are trying to do in terms of the global digital economy and world that we live in, and hope we get a chance to chat in the course of the day a little bit about some of the partnerships and some of the synergy that I think can exist between us, which needs to exist between us.

Before I go on let me answer your question. We released the information because we are confident in the assessment that we made through the intelligence community and we thought that it was important for the American people and for the world to know that this is discernable and unacceptable. Now, it’s no secret to any of you that cyber activity of a malicious intent has been going on for some period of time. And it’s obviously extraordinarily important as the world becomes more dependent in business, in services, in infrastructure, in so many different ways, on digital commands and control. This is growing in its threat capacity. And we thought it was very important, based on our clear tracking through the technology that you’re all very familiar with, to find out where this was coming from and who was up to this.

So we released this information to put the people doing it on a notice that they’re not, quote, “getting away with it” for free, as well as to put states on notice that we’re serious when we say they need to take every measure possible to guarantee the integrity of our elections.

And we also did it after very clear messaging to the Russians about the unacceptability of interference with democracy in the United States of America. And we will and can respond in ways that we choose to at the time of our choice.

But it also underscores, I think for every single one of you here thinking about policy as we go forward, sort of how are we going to – how do we establish the norms here? Last year we had a very big negotiation which became quite intense right before President Xi of China came to Washington. And we hammered out a set of standards which you’re all familiar with, which would require certain standard behavior going forward of what is acceptable and what is not.

Everybody understands that spying is something that has existed way before the internet. And there have always been these kind of unwritten rules of espionage. To a certain (inaudible) it’s hard for me to be particularly precise with you about exactly where the line is drawn. Everybody’s understood that people are hacking and working like crazy to get into proprietary information of one company or another, and a lot of folks are engaged in this kind of activity. Some countries are more proficient and more prolific than others.

But I think that we all need to step back, and this is one of the reasons for our – for my being out here, is to try to figure out what kind of partnerships we can build and what we all need to think about as we go forward so that we balance the enormous equities of the digital world which we have – I certainly as a senator, I used to be chairman of the Communications Subcommittee. And we wrote the telecommunications law of the country in 1996 and began to deal with data transmission and other issues as things evolved, and work through all of the opt-in, opt-out, net neutrality, and open architecture challenges of the verges of the internet itself. And we fought hard to make certain that – we’ve been able to draw some lines with respect to – for personal privacy and data privacy and other things, but at the same time to keep the open architecture; recognize that the real power of this platform is the innovation, and the creativity, and the free movement of information.

And there’s a challenge, though, automatically, that you begin to get into an arms race with respect to cyber warfare and cyber activity. It will require much greater attention to security, to impenetrability, to real protections. And of course, that then raises other kinds of question of law enforcement and counterterrorism and other interests that we all have.

So this is a fascinating and as yet not fully explored undertaking. But I think the signal we sent last Friday was really to fire a major wakeup call to people and a warning signal about the need to have the discussion about these challenges as we go forward.

MS BOYD: So we’ll get to the partnerships between Washington and Silicon Valley in a second, but I just want to press one more question here, which is that if a Russian agent had been captured physically breaking into the DNC, Washington and the United States has long had policies of what it would do. It would expel diplomats and, like, impose sanctions. But the cyber world seems to be a world that you haven’t quite caught up to. So I – you probably can’t tell me what we’re specifically going to do to respond, but what are we going to do to set those lines in the sand, to have “if this happens in cyber, then we do this.” So already in the physical world, our adversaries know that if they cross this line or that line, this is what our retaliation is going to be.

SECRETARY KERRY: Yeah. Well, one of the difficulties, as everybody here knows, is that it is – I mean, if you had somebody going Guccifer 2.0, whatever, and you’re – who is that person? And how do you find that person? And who do you arrest? You can find a location, but you can’t necessarily find the person that was working the keyboard or engaged in that, particularly if you saw – I think there was a show on TV the other night that did an interview with some folks in Russia in this particular – or one of these particular locations. And what they do is they rent space out, and people come in, and they can come in anonymously and use it and then disappear.

Now, is that a GRU person or is that some other person? I can’t tell you precisely.

So there are a lot of different aspects of this that are not as discernible as arresting somebody that you catch in flagrante, the person is there, you take him off to jail, and you prosecute him. And that’s where we’re going to need all of you. I mean, this is the conversation we need to have. I do not come here with all of the answers to this because a lot of this is uncharted territory. And we’re trying to figure out – as I just said, there’s a balance. The community screams if there’s any notion of any kind of backdoor activity, and we respect that. Nobody’s seeking a backdoor entry. But at the same time, as we look at encryption and other challenges (inaudible), which we support, by the way, because it’s an important advancement to the security that we need, and it’s an important way to deal with private sector concerns and other concerns. So there’s a market there for that.

But at the same time as that exists, what happens one day if somebody comes to you, your company tells you, “Hey, by the way, we happen to know from all the information we have that there’s a nuclear weapon planted in New York City and we have 48 hours before it goes off, and you’ve got the information that could help us track and perhaps prevent that from happening”? What are you going to do?

These are big issues – very, very tough issues. What I think we need to do to begin with is what we did with China, where we got into a very clear discussion about how this was going to affect the relationship, how it had the potential to impact commerce and trade and other issues, and therefore we needed to reach an understanding about how we were going to establish rules of the road. And since this is all, as I said, uncharted territory, we have to chart it. And we have to begin to sit down with the major players and begin to work at a global understanding of exactly what the standards are going to be to which people will be held, and what may or may not happen if people violate those standards, so that we don’t get into an absolute collision with the fundamental founding principles of the digital world itself, which is open architecture, freedom, neutrality, nongovernment interference, control, and so forth.

And we want to respect those citizens – that’s the power of it. We all understand that. The power of it comes from this incredible, innovative force that it has fostered, and with the remarkable transformation taking place in the global marketplace, and what it does to empower people. And that’s an empowerment that we are interested in having because it has something to do with democracy, with freedom, with human rights, and standards.

So the virtues are gigantic and the issue is how do we all get together and organize ourselves around a set of principles that don’t do violence to any of that.

MS BOYD: So in practical terms, what is the role of Silicon Valley in that? You’re talking about the United States and China discussing what the standards are and yet the domain experts of how this all works, what the possibilities are, what the consequences, are sitting within the industry. So do they have a role at that table?

SECRETARY KERRY: Sure, they will. And you’re already playing a role, many of you, in many different ways. I mean, we held – President Obama came out here and the deputy secretary came out because I was traveling and unable to be here, but I would’ve loved to be, and we had a big meeting with a lot of stakeholders out of which grew the Global Engagement Center, which now has some 65 initiatives and about $20 billion committed to various undertakings in order to create a partnership in these endeavors.

We’ve got – we have major undertakings. And we have the Global Entrepreneurship Summit that we’re doing, the Innovation Roadshows that (inaudible) 13 countries now, and the most recent one in Argentina. We’ve been working with the global international (inaudible) science and technology, which is empowering people literally to (inaudible) people, and organize a massive effort to begin to empower, mentor, help people with entrepreneurial efforts.

So we’re engaged with you and you’re engaged with us already in helping us to be able to solve some problems. I just had a meeting this morning with a large group of Stanford students who are engaged in a hacking diplomacy class, which has taken some seven challenges that we define in the State Department, and we’ve given them to them and said, you – as part of their class, and they get credit for it, they’ve got to figure out how they’d meet those challenges. One, for instance, in human trafficking; one in dealing with avoiding space collisions; one in dealing with countering violence extremism, where we put a major effort into countering violent extremism. We are opening centers in various parts of the world. We have on in the Emirates, hiring local indigenous population. We’re dealing in three languages now – in Arabic, Urdu, Somali, and building into French because of what’s happening in Africa.

So we need you to help us figure out how can we take the beauty and brilliance of this incredible platform and translate it into outcomes that will benefit mankind, make us safer, solve problems, advance human rights, build capacity. I mean, run the list. There is stuff to be done there and you can do well and do good at the same time. And that’s part of the premise. But it’s very difficult, we’re at the beginning stages of it and what we need to do is build it out.

One person asked me this morning: Does what you’re saying and doing about the internet now mean somehow that you’re going to start legislating and creating bad actors, designating them, or requiring a kind of statism, if you will, from the community? And I know that’s an anathema – the concept is an anathema to anybody. It’s an anathema to us. And the answer is profoundly no, we are not trying to make anybody an agency of the government where we compromise what you do. But we are saying you are citizens. You are both corporate citizens, and in the case of many of your entities, American business citizens, and there is a corporate citizenship standard as well. And so we’re simply looking for a sense of responsibility as citizens to be able to help us to cope with some very significant challenges, obviously.

MS BOYD: So the Global Engagement Center, which you mentioned – so I’m not sure how familiar everybody in the room is. So in January is when a delegation came out here – I think following the San Bernardino shootings, President Obama asked his law enforcement intelligence folks to find ways to work more closely with Silicon Valley. There was this delegation that came out in January, and I think, if I’m not mistaken, one of the things that came out of it was this Global Engagement Center.


MS BOYD: Can you speak a little more specifically about what exactly that entity is, how it connects with Silicon Valley, and if folks in Silicon Valley felt like they had something to contribute, how would they – where are the on-ramps to even begin engaging?

SECRETARY KERRY: Well, this is one right here today. But we have people – I have – (inaudible), we have him working out here full time. He’s a State Department employee. He’s been placed out here in the valley in order to link up with you and be here full-time in order to be your on-ramp, if you will, if you’re not already engaged in one of the other entities that we have, whether it’s the GIST program, or the global center, or otherwise.

What it – the Global Engagement Center is mostly focused on countering violent extremism. And we have 131 employees authorized, I think we’re currently at about 68. Why are we not at full force? Because it’s pretty competitive out here and tough to get people. We’ve hired some folks from out here, welcome, but obviously we don’t have start-up opportunities or other kinds of ROI that excites people to come. So it’s hard to find the talent and fill the slots, number one. It’s just been a slower growth process than we would have liked.

But we do have a lot of extraordinary talent that has come to the table. And we’re trying to figure out ways of communicating the example. We started out more global and central and working out of Washington with a message fashioned in Washington. And what – the metrics we were able to apply to that to make judgments about it indicated to us: this is not a great model, not working properly. We’re not the right communicators and anything emanating from us did not have the validation and legitimacy necessary.

So that’s when we set up what’s called the Sawab Center in Abu Dhabi, which is mostly Arabic speaking but not exclusively. And we are taking a lot of – we’re messaging and changing the narrative of ISIL, of Daesh. And countering that narrative very forcefully. We use a lot of defectors, a lot of survivors of Daesh’s brutality. And they are the people who are messaging. They are the communicators. They’re the people who are debunking the extraordinary lies of a fairly sophisticated Daesh operation, I might add. It’s quite amazing how effective they’ve been for a while in proselytizing propaganda and so forth.

Their narrative is caliphate, we’ve taken territory, we’re the future of true Islam, and on you go. And you have to find a way to counter that that’s effective and I think we’ve gotten pretty good at it. We know we have reduced recruits. We know we have cut financing. And I am absolutely convinced, not any exaggeration, that we are going to destroy ISIL as we know it now, in the sense that there’s still a few al-Qaida folks around, but there’s not the day-to-day threat that existed. We’re moving on Mosul, we’re moving on Raqqa, we’re shrinking their space significantly. They haven’t taken one piece of territory and held it since May of last year and their leadership is being decimated person by person.

And I’m quite convinced that – but the problem is there have been thousands of fighters over the course of five years, some of whom have gone back to other countries, where through the internet they’ve been able to build subgroups of the group, or create affiliations with Boko Haram, with al-Shabaab in Somalia. And so we’re going after them too, and that’s why Somali is one of the languages we’re working in now, and French for Boko Haram. And we’re getting pretty good at this.

So that’s an example. Cuba – example. I mean, we’ve opened up Cuba. One of the components of our diplomacy in opening up Cuba was to get and increase access for the Cuban people to the net. And that’s happening. Not as fast as we’d like, but it’s happening. You go to a place like Vietnam – I mean, I fought in the war in Vietnam and we were supposedly there to prevent the place from being communist and we spent 58,000-plus lives in an effort to do that in 10 years, then the longest war in American history, to try to do it. And guess what? The way we did it is by opening up and normalizing our relationship, which John McCain and I led together, lifting the embargo to include business and now there’s no remnant of, quote, “communism,” which is a economic theory and plan. It’s raging capitalism, with an internet which people have access to. (Inaudible.) And it’s still a one-party authoritarian country, and there is still unfortunate abuse of rights, other things, but over time it’s beginning to show change.

And this is why – this is what the Global Engagement Center is all about, trying to partner with you and work with you in ways that – where you can bring us ideas, and you can bring us solutions to some of these problems. Human trafficking is an example, another example of ways in which this works.

The internet is the high standard of access and information and accountability. Corruption has been exposed on the internet in ways that have changed behavior. There is a major (inaudible) China, in one of the towns in China who appeared on the social media with a tan line where his watch had been and the authorities wondered why he wasn’t wearing his watch. Well, they then went back and compared some other pictures and saw a Rolex or (inaudible) or whatever it was, and wondered how at his salary he had afforded a $30,000 watch. That was it.

So it’s changed behavior. The accountability, through social media, has created – it used to be the number one delivery point for (inaudible) in the world. It is not anymore, and nobody (inaudible) result. So corruption is being held accountable by virtue of the net.

Another example: In China, we on our embassy put air quality tweets out. And the Chinese eventually realized that the appetite that existed in Beijing for people to get the information about the quality of their air, it became one of the moving components of their switch to help us and begin to join with us in the global climate change initiative that allowed us to win what we won in Paris, which is the Paris Agreement, was really a shift in attitude about public accountability that came through the digital accountability.

So you’ve got more ideas than I can begin to list that we have tapped into but that’s the partnership that we’re looking for. How do we creatively take things that will expose corruption, that can create financial accountability in states, that expose the budgets – various other things that are yet to be defined. There are ways we think that we can make this more effective and that’s the kind of partnership we’re looking for. That’s what the Global Engagement Center is set up to do.

MS BOYD: How about flipping it around? You were talking about ways in which you can partner or get ideas from Silicon Valley to pursue initiatives that the State Department is interested in or Washington is interested in. But historically Washington was node. Anything that was going to happen overseas more or less went through Washington. Right now it’s all dispersed. I mean, there’s stuff that’s happening on the technologies that are being built here that have – that overlap with these interests and initiatives and objectives and goals, but that Washington’s not at all involved with.

I was talking with a woman earlier who was talking about on their social network, there was a person (inaudible) country overseas who was homosexual and was worried about being persecuted there, and this crowdsourcing bit, everybody on that social network was telling them: Here are the sort of things you can do.

So the question is just, like: Instead of having a model where Silicon Valley comes to you and says, “Here’s an idea,” how do you all support what’s actually already happening in the world today?

SECRETARY KERRY: Well, I mean, an example would be the negotiation we had with the EU to deal with the loss of Safe Harbor and create a Privacy Shield. I mean, we’re engaged with TPP. We have protected the transfer of data across international borders in the TPP. That’s one of the reasons why the TPP is so critical. It’s the first time we’ve done that in the context of a trade agreement. I think it’s a critical part of what I just said earlier about figuring out the norms and standards by which we’re going to go forward.

So I now – I’ve made certain that we have a digital officer in every embassy. We’ve got 139 digital officers now in embassies around the world. We have given them curriculum, we’ve trained them through our Foreign Service Institute, we’re constantly trying to hone it. But we’re well aware of the criticality – you’ll hear from Penny Pritzker, I think, tomorrow. Penny’s going to be here and I think talk to you a bit about some things we’re doing and they’ve been terrific. The Commerce Department and Penny are way ahead of the curve on this too. So we are all working together to try to guarantee that we’re representing you. That’s our job. That’s what we’re trying to do.

MS BOYD: Let me follow up to that about the question of tech fluency. You were talking about there’s a digital officer in every embassy. So when a Foreign Service officer gets trained, they get trained in economics, in international affairs, et cetera, et cetera. Do you think we are now moving into an era where a foreign officer needs to be able to speak with fluency about Bitcoin and dark web the same way they do talk about international law today?

SECRETARY KERRY: Absolutely, yes.

MS BOYD: Is the State Department moving towards doing that training?

SECRETARY KERRY: Yes. That’s the curriculum we’ve put together. I mean, I haven’t asked -- there’s a lot of uncertainty with Bitcoin or whatever, but – (laughter) – I think --

MS BOYD: But not just the digital officer. Like, all the Foreign Service officers.

SECRETARY KERRY: I can’t tell you that every Foreign Service officer is being trained to the degree they ought to be but they’re all being made aware of this fundamental premise, which I have – which I hammered since the day I was nominated: Foreign policy is economic policy, and economic policy is foreign policy. There’s no distinction in today’s world. And I have tried to elevate everybody within our embassies to be a jobs officer, to be working to help businesses and facilitate transfer of goods and services. And we’re doing a lot better at that. I mean, we are doing pretty darn well with that, I must say to you.

I mean, I just with – I was with General Electric earlier today. I had lunch with folks in – I actually had a breakfast meeting with some folks from GE too. And I think we’ve helped them. They would tell you we’ve helped them secure billions of dollars in contracts in a number of different countries by aggressively working the government and marrying them with certain agencies and ministries, and helping them to get in. So we’re much more versed in it than we’ve ever been before. I’m confident there’s room to grow.

MS BOYD: I’m going to switch directions for a second to the question of, like, encryption and privacy. Obviously, this has been a big debate between Washington and Silicon Valley, specifically Washington advocating for backdoors in encryption products. But you said earlier right now that nobody’s asking for that.

SECRETARY KERRY: I don’t think they – look, I think we had the one celebrated instance which got resolved in a different way, and it was a lesser confrontation than the kind of question that I asked you about New York and the bomb. And there was a lot of resistance and I understand that. We are not – there’s no official policy, there is no dialogue about looking for backdoors or legislating them, and I don’t – I think you’re going to have a couple of senators here. I don’t think there’s any movement in that direction right now.

We support the search for good encryption apps (inaudible), and I think – and there a few out there, and it’s growing, and we’re supportive of that. But we also need to figure out how we’re going to have an appropriate balance with the ability to protect the American people. The examples are what we do to share information about travelers. We have been able to save aircraft from going down because we’ve known who’s traveling, or we’ve been able to pick up information about plots and – I can’t go into them here. That’s just – it’s classified, but I can tell you lives have been saved because of our ability to be able to know what’s going on in certain places and still protect the privacy of Americans.

And I ask you all to go back and measure the level of privacy in the United States well before the internet became as developed as it is today, or became the internet. I mean, go back and check what privacy was like in the 1980s – late ‘70s, ‘80s, early ‘90s – when you could buy people’s criminal records and buy their entire credit background and – I mean, the difference today is a whole bunch of it’s more readily available when you just tap in a name and go to white pages somewhere and you can do a quick analysis. But all that information has been available for a long time; just a lot of people didn’t know it.

So I think we’re going to have to figure out what that balance is going to be in a world where we see Russians allowing hackers and instructing some people to try to interfere with our democracy. We’ve got to figure out how we manage this arms race, folks. I don’t have all the answers, except to work to try to get the norms and standards agreed upon internationally, which is the job I have at least for another four months and then I pass on to something else. But we’ve got to figure out how to do that. That’s part of the challenge of newness and transformation.

But this isn’t the first revolution and the first change in behavior. We had the agrarian revolution and we all figured out new rules of the road, and the industrial revolution, we figured out new rules of the road. And this is the latest revolution and we’ll figure out the rules of the road. I am confident about that. And hopefully do it in a way that balances interests in keeping with the values of our country. And we have to rely on the common sense and soundness of American judgment to do that.

MS BOYD: So going back, as you mentioned, to the Russian hack and cyber-attacks. I think what many people found most disturbing about the announcement Friday was this idea that you have a foreign power trying to undermine our fundamental institutions. We’re all familiar about this in the physical world. We have military to protect our physical interests. Is – now that we’ve actually had a foreign adversary attempt to undermine the most fundamental institution in our country, is cyber now a battlespace that Washington has to think about, fund, resource, and plan for the same way it does the physical military space?

SECRETARY KERRY: So what this has done is expose the reality that before this happened cyberspace was already that battleground. It has been a battleground for some number of years now with increasing potential consequence as people have gotten better at it and as the consequences have become more apparent. When you have major infrastructure that depends on cyberspace or receiving its instructions from and monitoring its functioning, you have potential for mischief with respect to how that particular infrastructure might work, whether it’s a transportation network or airline traffic control or radar or water treatment facilities or water distribution or any energy source whatsoever that has a smart meter or a smart grid or whatever.

I mean, that’s the world we live in today. That’s why this is of such consequence. And not to mention weapons systems and defense systems and networks of early warning and – that’s why the Defense Department works as hard as it does, and you, some of you work as hard in certain cases to help provide as impenetrable and failsafe a set of systems as possible. But everybody here knows that – I mean, it ratchets up as time goes on and there have now been too many examples of invasions of privacy and the theft of major information. And you don’t read about it every day but major amounts of money have moved from one place to another under these circumstances also and people don’t want you to read about it every day.

So this is good and it’s why your meetings and your engagement in this is so critical because we’re not going to be able to do this on our own. We’ve got to figure out how we balance the assets of the positive side of the leger of the digital world with the negative side, and nobody should pretend their ain’t no negative.

There are some challenges that come with this, not to mention the social structure challenges. And these are other things you can help us with because the productivity increases are not what they were. Blue collar jobs are being lost at a higher percentage than are tech jobs filling the void. And everybody knows with other advances coming down the road – I had an interesting conversation at lunch about AI, other things. I mean, there’s just a massive amount of disruption that we’re living with today.

And public policy is much harder to fashion into a consensus as a result of that. But when you add to that the nature of our media today and the political space that we’re operating in in terms of its polarization, it is really difficult. I mean, I want you to know as Secretary of State how difficult it would be for me this morning to go to many countries and say, “Hey, did you see our debate last night? You ought to try our democracy.” (Laughter.) It’s tough.

So this is very – this is a very important forum here that – and this is the place, Silicon Valley, and I will add that I represented Massachusetts for 28 years in the Senate, Cambridge, and Massachusetts where we share a fascination with what could be achieved through the advances in tech and what we have to do is harness this moment of transformation in a way that minimizes the negative disruption and maximizes the positive for people. We have to tame the worst instincts of insensitive capitalism and get a sustainable and people-sensitive product that everybody can feel good about because right now we’ve got a lot of angry people who just don’t know where their future is and where they’re going and how are they going to work and how are they going to pay their bills and provide their kids with the same opportunities they feel they had. So that’s part of the disruption and we’ve all got to be thoughtful about how we’re going to manage this.

MS BOYD: So we’re going to take questions from the audience in just a second, but let me ask you – you said positive side of the balance sheet, negative side. So I think a lot of people in Silicon Valley were very inspired following the Arab Spring seeing how their tools have been used to enable people to organize and protest. But then on the flip side, in the years following we also saw how communication online was being monitored by countries who used it to actually come back at their people. So do you believe it’s not positive? Is it negative? Or is it –

SECRETARY KERRY: I think it’s absolutely a positive. Of course it is hugely a positive. And I think we have plenty of ways that we define the choices for people more effectively and give people these choices. There’s no question in my mind that we – I mean, the transformation means that some people will be more involved in services and different kinds of enterprises, but there’s no great difference in that. I mean, in the – I hate to say it, but if you were a target and there was legitimate probable cause for it instead of being penetrated by somebody on your laptop or in your emails or something you would have been listened to on your old fashioned dial-up telephone by law enforcement or by a despot – by a dictatorship in some country in some part of the world. So that’s not new, it’s just a different vehicle. It’s a different mechanism. But where there are dictators, where there are totalitarian societies, they have been aided greatly by the flow of information and by our ability to show people what other people have in the rest of the world.

In fact, that’s part of the disruption. There are now – I forget what the number is – it’s about 8 billion, I think, devices in the world, and that’s going to up to a trillion in the course of the next what, 20, 30, 40, 50 years. And that’s empowered people. I mean, those kids in Tahrir Square used it for the most rudimentary purpose of tweeting to each other and say: Hey, come on down; we’re having a revolution.

But there are other things that you are well aware that go on that changed their whole mindset. And the beauty of it is today that everybody who has a smart phone has an instrument of empowerment by which they know exactly what everybody else in the world has and they know, therefore, also what they don’t have, and that creates a politics of change, which is why people try to block it. And this is an age-old fight for the passage of information. We had Voice of America for years (inaudible), but we were always trying to penetrate societies and change things.

By the way, what makes the Russian thing so different is that I don’t think any of us engaged previously in democratic exercise where we actually tried to change the votes somehow by coopting the counting process. But that said, this ain’t the first time countries, ours included, have tried to affect outcomes of governments or – in one part of the world or another. I mean, go back to Iran in 1953 when Mosaddegh was run out by the CIA and Kermit Roosevelt and – we were engaged in changing government, or Diem in Vietnam when we – so there’s a history of involvement. And some people argue to me as Secretary of State when I visit their countries that legitimate national institutions of ours like the National Democratic Institute or the International Republican Institute are engaged in that kind of activity.

It’s one of the reasons why you actually see political space narrowing now in some places and there are new NGO laws being passed in various places and it’s very ominous, but people are in fact trying to close down the legitimate exchange of ideas, which is not what the Russians were engaged in, but we had engaged in the legitimate exchange of ideas and they label it “interference” in their campaign, which is the difference. And that’s one of the reasons why we wanted to make clear people understood that distinction, because we don’t do those old things that used to happen. That is not a government role and it’s been, I think, for some period of time not something that we’re engaged in.

MS BOYD: Okay, questions from the audience. I think we have some microphones for some questions.

QUESTION: Hi, Mr. Kerry. My name is (inaudible). I’m the president of the San (inaudible) Program. Thank you for meeting us this morning. I was part of the Hacking for Diplomacy class that you met. Thanks to (inaudible). We’ve actually – we’re working on some of the hard problems you mentioned like tracking nuclear devices or identifying informal leader data sets. How do you think we should – how realistic is it if we actually come up with a solution that one day this will be implemented at the government level? And what should be really – what should we be striving for within these institutions to make this a reality for our nation?

SECRETARY KERRY: Well, you’re doing it. You’re in it. You’re in the program. And I have absolute confidence if you come up with a viable solution it is going to be implemented, adopted, and institutionalized. I don’t have any doubt about that whatsoever. And you have a fast track for making that happen because you’re in the program and you know (inaudible). So you’re on the right track. Just come up with the deal, okay? (Laughter.)

Okay, anybody else? Yeah.

QUESTION: Hi, Mr. Secretary, (inaudible) with the Alibaba Group. You talked about the vital important role social has played in contributing and driving political reform around the world. Could you also give the room your perspective on how cross-border trade can advance those initiatives through e-commerce, particularly leveraging large economies in Asia considering American goods and services and the kinds of things even Airbnb is doing to bring Chinese tourists here to the U.S. and having that kind of engagement?

SECRETARY KERRY: Well, it almost answers itself, I mean, in a way, Bill. I mean, I don’t want to be corny about it, but I mean everybody sees what Airbnb is doing in terms of – it’s the biggest hotel in the world and some of the hotels don’t like that because of that. But it’s empowering. It’s phenomenal what it’s been able to do, and it’s just one example. I mean, I’ve met home-based basement operations that are starting with three people (inaudible) because everybody’s got the kind of access as a result of it. It’s hugely empowering, as a result, on a global basis.

Now the fight is, obviously, it’s a larger fight that we have in a place like China where you’ve got firewalls, prohibitions, and limitations, and it’s extremely difficult, and in many cases some unfair trade practices and market access challenges, inequities that we’re working constantly to try to rectify. That’s an ongoing process.

That’s the power really of the TPP. And I hope every single one of you here would be an advocate. You want to do something immediate that’s important? We have an election in – what is it – 28, 29 days. I mean, the day after that election you ought to be in touch with your senators and congressmen or not even yours, any damn -- anybody’s (laughter) – and hammer away for TPP, because TPP raises the standards for text to transmission of data, and it’s got labor standards in it, it’s got environment standards in it. This is unlike any trade agreement every negotiated. It gets rid of 18,000 taxes on American goods, it opens up the market for us, it does exactly what you’re talking about doing. So – and it’s with the fastest growing region in the world, fastest growing – three or four of the fastest growing countries in the world are in the TPP and it connects the Pacific, and it links in very real ways the power of the rebalance to Asia that we’ve been engaged in.

So it’s just hugely important to do this. And what a self-inflicted wound to the United States it would be if we didn’t do that after all these countries have signed up and followed our leadership. Can you imagine what they will do next time we knock in the door and say: Hey, by the way, we’ve got a good deal for you. You’ve got to join this or that. It will be too late, because other countries will fill the vacuum and there’ll be some new structure that will never reach the standards of what we have achieved here.

So I urge you, every single one of you, this can be a major project that everybody here can be engaged in and it’s really important.

QUESTION: Thank you, sir.

QUESTION: Hi, I’m Bob Borsdson. I’m with the (inaudible) Group.

SECRETARY KERRY: Yep, I’ve heard of them. (Laughter.)

QUESTION: (Inaudible.) I’m sure you have. Can you imagine Secretary Clinton reversing her stance on the TPP if she becomes President?

SECRETARY KERRY: Well, I don’t want to speculate on presidential issues. I’m not about to – it would not help them if I speculated. It wouldn't help anybody and I don’t know the answer to the question. I doubt it. I think she’s made her position but I don’t think that necessarily is expositive of what Congress can do. So let’s see what happens.


QUESTION: (Inaudible). My question is about Europe. I know you were just in Brussels and I think many of us were really alarmed about the Privacy Shield in the Safe Harbor negotiations when it was possible that data may not be able to flow from Europe to the U.S. Could you talk about how their approach to the internet and how we could talk about all the choices the U.S. has made on policy and encourage Europe to go on our direction?

SECRETARY KERRY: Well, we worked hard at that and that’s why we got the Privacy Shield deal. It was a reflection – I mean as you know, that Safe Harbor got thrown out and we were kind of left hanging there. I think Europe came to understand better what the implications were of arguing for localization and other things to protect it from getting excessive in terms of the privacy piece, et cetera, which would have impeded the flow of information in ways that would have hindered business. And I think with Brexit looming, they recognized that their economy is already challenged. So I think their – I won’t say to you they’ve changed any view about privacy. I think that they value privacy extremely highly. I mean, we value privacy extremely highly, but we’ve made a few compromises in terms of the Patriot Act and other things that they have not been willing to yet make or agree to.

We’ve had greater problems with Europe, for instance, in trying to get them to agree to share passenger lists of flights. (Inaudible) finally took place, but it really was slow. But I think that now we’ve sort of ironed that out, and I think there’s a greater meeting of the minds even though there are a few distinctions still in how people approach one issue or another. But I think that we may well wind up now with real reasons for a greater integration because of what’s happening with Brexit.

My sense is it’s – I mean, our policy is to have a very strong Europe. We also want a strong U.K., and we want them integrated as much as possible, but they’re going to have to decide what that’s going to be. In the meantime we are pursuing already the Transatlantic Trade Investment Partnership, TTIP, which we will not get done in the course of (inaudible), but which we think we can get enough progress on that it could be finished over the course of the next administration.

And so I think you’re going to see progress in that field. That’s just my gut instinct. And you’ll see a greater meeting of the minds between us on the internet pieces of this. And I think people have understood we’re going to still have some fights in certain parts of the country on the localization issue but people are beginning to understand that in terms of economy of scale, in terms of just practicality, in terms of flow of information, you can’t vulcanize this thing and have it be what it is, and I think that’s sinking in. So I’m not sitting here feeling as threatened as I think we felt a year ago or so.

MS BOYD: We have time for one last short question if there is one. Can you wait for the microphone?

QUESTION: Secretary Kerry, thank you very much for your service. Very admirable. And we’ve watched you over the years and really appreciate what you’ve done. My name is Dr. Rita Webb, and I’m interested primarily in digital health and precision medicine, but I actually have a unique question and a concern. The term “ISIS-inspired,” I’m trying to understand why we actually use that term. I think that one of the reasons why ISIS has such a predominance and such a relevance is partly because we give them credit. And I think that using that term “ISIS-inspired” is a way of actually giving them premature credit for things that happen in the United States that they may actually have nothing to do with. There’s al-Qaida, there’s Boko Haram, there’s all sorts of other types of these types of organizations and I think that the media might consider not using that term so readily, “ISIS-inspired,” because part of the reason why they have the reach is because we actually use those types of words. Brands and words have meaning and I think when we use a term like that I think we give them more meaning by doing that. So that’s just an observation.

SECRETARY KERRY: It’s a great observation. It’s right on point. I agree with you, which is why I think I rarely use the term “ISIS” or “ISIL” at all. I’ve been on a lot of campaigns to get everybody to say “Daesh” because it’s a pejorative in Arabic – the initials – and I haven’t won that campaign at all. (Laughter.)

But it’s just – you kind of resort to the use of those letters because it refers to a state – it’s the Islamic State – and it’s not a state. There’s nothing legitimate about it. There’s nothing Islamic about it. It’s a complete misnomer. It’s their title and we shouldn't use it and I feel that very strongly. But it has gained – it’s the recognized term and if you want people to know what you’re talking about, unfortunately, sometimes you are forced to (inaudible) – it does (inaudible).

But it would be great if we could get away from that, and the key is the media to begin really to call it something else. The terrorist group Daesh – that would be the best moniker I think. (Laughter.) Or the most evil – the world’s most evil terrorist group.

Anyway, it’s hard. Today’s media is so – it’s so labelized and it reduces everything into these simplistic things. It’s very, very hard to break out once something has stuck. And if you have a solution for how to get away from – you’re absolutely, technically, substantively, correct.

QUESTION: So we can – just not using the term “ISIS-inspired,” just inspired.

SECRETARY KERRY: Oh, I wouldn't – I don’t think – did I say “inspired?”

QUESTION: No, (inaudible).

SECRETARY KERRY: I hope not. I don’t think I did. But it’s – I hear you, it’s – it would be good to get away from it.

MS BOYD: So unfortunately we’ve gone over our time. So thank you very much for joining us here.