Lawfare Daily: A Trip Around the ‘Hidden Globe’ with Atossa Araxia Abrahamian

[Intro]

Atossa Araxia Abrahamian: This model of quote unquote selling your sovereignty, it sounds very tawdry and untoward. It can be completely benign. It can be, some people find it totally egregious, but I think that in our world, it's a last resort but it's sometimes the only resort.

Tyler McBrien: It's the Lawfare Podcast. I'm Tyler McBrien with Atossa Araxia Abrahamian, an independent journalist who writes about the cracks in the nation-state system.

Atossa Araxia Abrahamian: The really bad part of that is that zones come with, like I said, concessions, and those concessions might include lower wages. It might include, you know, not making companies pay into the national insurance system. Basically privatizing and deregulating and contributing to this kind of race to the bottom that takes place.

Tyler McBrien: Today we're talking about Atossa's new book, “The Hidden Globe, How Wealth Hacks the World.”

[Main Podcast]

So, Atossa, I wanted to start with your reason for writing the book, which it seems in reading the first few sentences is your personal connection to your hometown, the city of Geneva. You write that, I began this book about the world on a lifelong hunch. There was something strange about the place where I grew up. And then a bit later, I am, and will always be a part of this world apart, a place to find by a certain placelessness. So by way of answering, you know what this book is about, I wonder if you could tell us why you wrote this book?

Atossa Araxia Abrahamian: Yeah, I wrote this book for a bunch of reasons, but the first reason, or the earliest reason, is that I, like Rousseau and many other people, am a citizen of Geneva. I'm also a citizen of lots of other places, but I spent the first 18 years of my life in Geneva, Switzerland and not just in Geneva, but also, ensconced in this sort of international world, with the UN and the WHO and the multinational companies that come to Geneva and just a whole mess of nationalities and people and cultures, and as a result, I never really felt that Swiss.

My school was mostly in English. I did one year of French school over the border in France. So there's all this, always the sense of like, well, I'm here, but I could be there. I grew up speaking multiple languages. And so this idea that, you know, we all belong in one place that's defined by very set boundaries and homogeneity and a sort of consistent culture didn't make any sense. And that's where I come from, right? That's my country, for lack of a better term.

Fast forward, you know, 30 years or 25 years. I'm living in New York City and I'm working as a reporter. And I started reporting on the nascent passport industry, this was the subject of my first book, “The Cosmopolites,” and the really short version is you can buy passports in a bunch of different countries. And I wrote a book about the people who buy them and the countries that sell them, and the weird ways in which this citizenship market distorts our idea of what citizenship even means.

Fast forward a few more years, and we are in 2016, in the middle of the, you know, 2015, 2016, in the run up to the election of Donald Trump. And I'm noticing that the conversation around globalization and nationalism is always framed in these binary terms, right? There's the globalists, and there's the nationalists. There's the rootless cosmopolitans, and there's the, you know, what do you want to call it? Like, real people.

And that always seemed to me to be not really the full story, right? Because what is globalization if not a bunch of decisions made by a bunch of different states to have things work a certain way? Nationalists are actually very complicit in a lot of the sort of hallmarks of globalization. When Donald Trump was gearing up for his administration's first Davos, I asked Davos, I asked the World Economic Forum, you know, how many times have the various delegates been to the World Economic Forum, and it was like double digits, you know, so the globalists and the nationalists were not necessarily mutually exclusive groups.

And that was sort of the basis, at least the idea, the sort of theoretical basis for this book, in which I set out to explore all the places between nations that link our world together. And that on the surface might look like they're challenging the nationalist idea of one people, one government, one state, one set of laws, but in reality are exploited, hijacked and utilized by nationalists to further their own interests.

So that, that's, that was a really long version of how I wound up working on this book. I was also just really interested in some of the places that I ended up writing about. Some of them are at home in Geneva, like the Geneva Freeport, others I will never go to like outer space. And so it was really fun to tie them all together.

Tyler McBrien: Yeah, no I'm, that was perfect. You laid out a lot of what I want to dig into. A few things being the, perhaps the death of nationalism and the death of globalization have been greatly exaggerated. It really complicates the picture. And of course, that just the title, “The Hidden Globe,” implies that there's a globe that everyone sees, and then something just under the surface, even though, as you write, it's often hidden in plain sight.

And then also just taking us on a trip around this hidden globe to these different places. So starting with Geneva, which you call the capital of the hidden globe, can you tell us a bit more about Geneva's history and how it became almost synonymous with this type of special zone or place within a place that you described throughout the book?

Atossa Araxia Abrahamian: Sure. So when, now, if you say special economic zone or free zone, most people who know about these things would say, oh, they have a lot of those in China. Or this is something that's really common in the Gulf. So it's not the first association you'd make to Geneva, but I go way, way back. Like, to like the Middle Ages to the time of mercenaries.

And what occurred to me when I was just thinking about Switzerland and why is it the way it is? And why is it so weird? It occurred to me that the Swiss mercenary trade which is exactly what it sounds like, they sold soldiers to warring monarchs next door, was kind of a proto version of the ideas that I am otherwise getting at, this sort of sale of sovereignty. In those times, no one was talking about it in those terms, right? Switzerland was just a, you know, cluster of cantons trying to survive with very little else going for them than their wiles. And so while you had monarchs and dukes and, you know, kings in neighboring territories, Switzerland trained soldiers and sort of rented them out to them.

And these soldiers ended up fighting pretty significant battles, you know, everywhere from France to Indonesia. And this was almost Switzerland's first main export, right? It wasn't cheese. It wasn't agricultural products. It was people. It was bodies. And what the cantons did at that time is that they kind of took this ability to train armies which is something now we associate with mostly states and turned it into a sort of a commodity.

So you fast forward after that and you see that Switzerland is using a version of this logic in really new and interesting ways. So, they were providing a lot of financing to the French kings, right, by Geneva-trained financiers and bankers. They created the Geneva Freeport, which was, again, they were using a piece of their territory, their sovereign territory, kind of creating a new set of laws around it and trying to attract commerce and trade to their land, to their shores.

And more recently, of course, you have the debacle of the Swiss banks, their power, or I guess their special status has been watered down somewhat. I mean, you can't have a number to count the way that you used to. But for decades, Switzerland was really the go to place for ill-gotten gains coming from abroad, and they were really not asking very many questions. And so again, it was this creation of a certain legal regime that was attractive, not so much to insiders, but to outsiders who wanted to take advantage. And so I kind of, I draw a line between the mercenary, the sort of warring mercenaries, and the legal mercenaries, and the banking mercenaries, and kind of framing them in the same terms.

I wouldn't say there's a straight line between these things. It's a wiggly line. It's more of an ethos, but I think that it prevails even today. You see cantons like Lugano and Zug that are trying to do a version of the same thing for crypto, right? And so, every generation of financial products of innovation, you're going to see the same mentality at play to bring in more investment and more wealth from other countries.

Now, the reason for that is that Switzerland is very wealthy, successful, wonderful in many ways country today, but it doesn't have a whole lot going for it in terms of, doesn't have a huge population. It wasn't all, it was all, it was hopelessly poor back in the beginning, before the confederation was formed. And so, it's got to do what it can to get by. And I think that many countries, many states find themselves in the situation today where every country has a vote at the UN, right, quote unquote sovereign equality. But the balance of power is just completely skewed, and economic resources are really unequal between countries.

We talk a lot about economic inequality, but we don't really talk about the economic inequality between states. One of the only economists who's really made a big thing of this is Branko Milanović. Anyway, in this very uneven terrain, states are going to do what they can do to get by. And again, Switzerland was an early leader, early inspiration for this sort of thing. But now you have places like Palau selling flags of convenience. You have small countries. It's like post creating postage stamps, right? Just to like, get a little, a few pennies from collectors, right?

Tyler McBrien: Phone numbers.

Atossa Araxia Abrahamian: And so this model of quote unquote, selling your sovereignty, it sounds very tawdry and untoward. It can be completely benign. It can be, some people find it totally egregious, but I think in our world, it's a last resort, but it's sometimes the only resort.

Tyler McBrien: Yeah, no, I think the example of soldier-mercenaries is a great one for two reasons, because it complicates the idea of sovereignty in nation states from their inception. If you think about states as having a monopoly on violence and two states fighting each other being a legitimate war. And then a third party comes in who's paid, is interesting. And then also that these zones and these exceptions are not just financial tax havens. There's also political dimension.

There's a, you know, a violent dimension, if you want to put it that way. So I want to get into some of those examples. So we've talked about Geneva, the Freeport figures prominently in your book, but some of these other extraterritorial domains, there are some great examples you take us through: Próspera, there's the oceans, are a jurisdiction, even to space. So what were some of your favorite examples of the extraterritorial domains that you talk about, and what do they highlight as a different dimension of the hidden globe?

Atossa Araxia Abrahamian: My favorite extraterritorial domain is outer space, right? Because the absurdity of it, the absurdity of terrestrial countries, many of whom do not have a spacefaring capacity, to make laws that apply out there, it's just, it's mind blowing. The epigraph for the book is from a poem by William Empson, the literary critic, and all you really need is a line: law makes long spokes of the short stakes of men. And I just love that so much because in my head when I read that line, I see Luxembourg. I see their tiny little capital. I see their parliament voting on laws to recognize property in outer space, right? Like property that can be exchanged for human money. And like, it's just, it's on one hand completely abstract, and on the other hand, it is dead serious. It is completely real.

So what happened in Luxembourg, or in space, whichever way you choose to think of it, is that in 2017, Luxembourg decided that it was going to invest in space resources. Now this was coming on the heels of a lot of very buzzy reports about asteroid mining, about all the gold and silver and platinum and water and stuff you could find in space.

And the treaties that govern much of what happens in outer space were signed in the ‘60s and afterwards at the UN. And most of those concern things like war, like there's a committee on the peaceful use of outer space. Those treaties and those agreements, the goal of them was to make sure that Russia and the U.S. were not going to nuke each other on Mars, to put it super crudely, or the Moon. And one of the important parts of these agreements is that no country could claim outer space as part of their territory. Because we all know what happens when a country claims territory, another country wants to claim it too. So that's settled, right? Nobody is trying to say the moon is mine or this asteroid is mine.

But the question remains about what happens to the things on the moon, or the stuff in an asteroid or on an asteroid, or the water, or whatever natural resources are out there. And there was some ambiguity in the in the agreements that we had. And so a few countries, including Luxembourg, stepped in and said, well, we can't carry on with this kind of ambiguity, given the amount of interest from the commercial side and space resources. And so we're going to pass a law, and we're going to make it legal.

And so the result of that is that if you and I start a space mining company and we register it in Luxembourg, even though we have no connection to Luxembourg, Luxembourg will, in the event of our finding ,or striking it rich, right, they will recognize that this money belongs to us, that whatever the proceeds of our incursions in outer space are rightfully ours.

And this is nuts, right? But it's fascinating. It's so creative. And it's sort of, in my view the pinnacle of this, like, logic of offshore thinking, right? What is space, if not, like, the ultimate offshore location? Surprise, surprise, Luxembourg has, for its entire history also done other kinds of offshore things, right? It's a close cousin to Switzerland. It really was a pioneer in a certain type of offshore tax maneuvering. And so when you think of it in those terms, with that kind of history behind it, it's not surprising that they're gonna be doing nutty things in space.

Tyler McBrien: No I, I, one of the reasons I love the book so much, and probably what attracted me to it in the first place, is this idea of legal fictions, and these contradictions. As you were talking, I was just thinking about this joke, gag gift, that probably Lawfare readers would find funny, but nobody else, where it's a book, and on the front it says Liechtenstein Maritime Law. And you open the book and it's just an empty notebook, because Liechtenstein is twice landlocked. So it has no maritime law, but I'm realizing it's actually not that funny for another reason, because it's not so absurd that it would create maritime law, you know, for other reasons, you know, being that it's not, it has no shoreline.

Atossa Araxia Abrahamian: The surprising thing is that Liechtenstein does not have a flag of convenience that it's making big bucks off of, despite being twice landlocked. Switzerland has a fleet, a maritime flag, lots of landlocked countries have them. Cameroon is landlocked, I believe, and it is a pretty big flag of convenience, not the highest end one. But this speaks to what one of the points I'm trying to get at, which is that physical geography, you need it, right? Everything's got to start somewhere, especially in a world of territorial nation states, but it's definitely not the be-all, end-all of lawmaking.

Tyler McBrien: And speaking of lawmaking, I want to talk about the Dubai International Financial Center. So first of all, what is that? How did it figure into your story? And then also, can you explain a bit about this court in a box effort that was undertaken, I believe, by someone named Beer, the Englishman, if I'm not mistaken.

Atossa Araxia Abrahamian: Mark Beer, yes.  

Tyler McBrien: Mark Beer, thank you. So, yeah, again, what is the DIFC and why did they need to create a legal system piecemeal from other legal systems?

Atossa Araxia Abrahamian: Yeah, to understand the DIFC, there's a couple of things to keep in mind. And first, the UAE, the United Arab Emirates, were a protectorate of the British for, you know, some decades until 1970s, when they became, you know, independent UN member states.

The second thing to keep in mind is that there was a big economic boom in the Emirates in the, around the same time, and they found oil. I think it was most significantly in the ‘70s and ‘80s. And so there was just a lot more activity going on. This isn't to say that Dubai was what a lot of people like to say it was a fishing village. Like there was a lot more going on than just some fishing. Right? But there was just a much, a big increase in like industry and economic activity.

So, with that said, Dubai, like Switzerland, like Luxembourg, like outer space, not a ton of people living there, not a ton of natural resources to exploit until they found oil. But they, but once they did find oil, they wanted to bring in outside companies, right, to exploit it. They also wanted to build a different kind of economy, services, goods, finance. And in Dubai, in particular, there was a port that they were going to build up to just, again, to build up their economy. They wanted to take advantage of their location.

The big sticking point with Dubai, and this is according to a bunch of people I interviewed who were there at the time, was that foreign companies were not versed in the local legal tradition. Whether that's because they didn't want to hire local Arabic speakers, whether they didn't respect local legal traditions, in this sort of neo-colonial way, or they just couldn't be bothered, that there are plenty of reasons why. But basically if you have a, let's just call, let's say Deutsche Bank or Goldman Sachs didn't want to come in and learn a whole new, they just wanted to import their people and, you know, do business the way they'd always done to the degree that they could.

Dubai was also developing itself by creating these special economic zones with like perks and concessions. None of them huge, right? Like not, it wasn't like you were stepping into a new, completely new legal regime, but there would be tax breaks. There would be, you know, fast track to visa processes, little things that make life a lot easier if you're setting up a company. And so, the city started to become, the sort of business landscape, started to become defined by these zones that would come with these big real estate developments and, you know, infrastructure and whatnot.

And one of the zones that they were really banking on, that the ruler of Dubai was banking on in the early 2000s, was the Dubai International Financial Center. So this was a zone much like other zones with perks and concessions, but this one geared towards finance, so they were trying to bring in banks and hedge funds and various financial companies. Along with the tax breaks and the labor deregulation and what have you, they also proposed to have a court within the business complex.

Initially, the purpose of this court was to have a place where tenants of this zone could have their day in court. So, it would be like construction issues or employee issues or, you know, whatever you would have in a civil, in the civil law, but just for people like a homeowners’ association or something like that. And little by little, this jurisdiction began to grow. And it didn't grow physically because the boundaries of the DIFC were pretty well determined. It was growing up, but not so much out. But they kept allowing people to opt into their jurisdiction. And the reason for that is that they had imported the judges, in many cases, the defendants, the litigants, all the people involved in these court cases were coming from abroad, sometimes they weren't even living there.

So the judges came from Commonwealth countries and half the time, I think they were just zooming in. This is way before COVID, by the way. They were just rented from other places, you know, doing their secondments in Dubai, and they were experts in commercial cases, so they had, they brought something to the table, but this was really, there was nothing homegrown about this legal tradition there. It was really just made up. And I call it a Frankenstein jurisdiction because it was made up of parts of other kinds of law, and people from all over and, you know, you can imagine, you know, a limb from Canada and an ear from Australia and what have you.

And this turned out to be very appealing, right? For the same reason that we started talking about, and that's the companies that were coming from elsewhere wanted a set of, again, legal certainty, but they also wanted to know how the law was working and they already knew, based on what they'd done before.

This is kind of a long-winded way of saying that they created a court from scratch. It was like a startup court and the person that led the charge was a lawyer named Mark Beer, British guy, worked at a bunch of multinational companies. And the way he tells it, he was really tired of getting on a plane every three days and flying to Mexico for a meeting and coming back. And so when this opportunity presented itself to him, in Dubai, he had like a bunch of kids, and he was like, yes, this is great. Not only can I commute, you know, half an hour instead of getting on a plane all the time, but it also allows me to put some of my ideas about the law into action.

And when I spoke to Mark Beer, he made it clear that for him, law was not just, you know what you and I might think of this quote unquote justice, but it was a tool for developing economies.And the idea there is that if you have sound laws, if you have a good legal regime that companies feel comfortable operating in, they're going to come and be more inclined to put money and resources into the territory that they're coming to. And so it's yes, it will allow two parties that disagree on something. There's a dispute of some kind to have an arena to hash it out. But in providing that it's also going to create, have economic, positive economic effects. And that so that was part of his motivation as well for being the registrar of this court.

Tyler McBrien: I think another, I say this in a complimentary way, but another feeling I had reading your book was one of unsettling or unmoored. And you know, as I'm reading, doing double takes at common idioms, like having your day in court or one that you bring up a few times is law of the land, which start to fall apart in your hands, as you learn more about these Frankenstein jurisdictions or extensions of sovereignty.

But I wanna just stay on, on Beer for a bit as well as some of the other characters in your book. The Freeport King comes to mind. Someone who is reading about your book, or just even perhaps seeing the title, may think that this is a very nefarious world, which much of it is, and therefore many of these characters who participate in it and build it would be very resistant to speaking to you. But that wasn't the case. People were quite generous with their time and it seemed like fairly forthcoming. So what was your experience in talking with some of these people? I mean, rich people and their handmaidens, to put it that way, are not known for being the most open, forthcoming people, especially to journalists. So is there experience reporting the book and talking to these people?

Atossa Araxia Abrahamian: Well, you know, I got lucky in that a few people were willing to talk to me and then they say, oh, you should talk to this guy. You should talk to this person, et cetera. So, in a sense, it's just being persistent and having a lot of time to chase people down. But I think even having written this book, I'm not really out to get anyone for the particular things they did in their career. In fact, and they might feel differently having read the book, but like, I rather admire the ingenuity, the cleverness, and the ability to identify these loopholes. Like, it's really clever, it's really smart, and my, sort of political leanings are always like coming up against my awe. Like, wow, you came up with this? That's incredible. So, there's not not admiration on my part.

Why did they talk to me? I mean, I think it's also just that when you see this world, that most people don't see, because it is hiding, you’re not supposed to see it, it can feel quite lonely. And then to find someone else who sees what you see, it's nice. It's gratifying and you feel less crazy. And I never thought that I would be saying that I felt less crazy after talking to a bunch of consultants and lawyers, but it did kind of, for me at least, validate what I was noticing. People like attention and I, you know, we had some good conversations and it's all, it also helps to be a little early to the story.

My last book was about people who buy and sell passports and at the time I had no trouble getting people to talk because no one was talking to them to begin with. And I think now with the past 10 years of these golden passport debacles, probably much less likely to give a journalist the time of day.

Tyler McBrien: Yeah. There are a lot of creative legal constructions. I also found myself responding in this, wow, you really got to hand it to him kind of, aspect.

I want to get into the good, the bad and the ugly of these zones and extraterritorial domains. What are some of the positive aspects? I mean, Mauritius is often touted as this, you know, these zones as development policy type of case studies, if you want to call it that, but I think even just the simple idea of siphoning off tax revenue from a society can have very obvious negative effects. So what did you find where these, the upshot of these zones, of any stripes? So, you know, like I said, the good, the bad and the ugly?

Atossa Araxia Abrahamian: Mauritius is a good example of a place that was able to really open itself to the world through industry, right? And definitely raise the quality of life for a lot of people. Not everyone and not probably not by as much as it could have, right? Because the zone model is based off of concessions to foreign industry, and that usually means that they're given a reason to come there. And that usually means, you know, they're saving money, right? So, could they have saved less money and given more money to the country? Sure.

But in that case, it worked out. And there are lots of reasons why it worked out. And economists have written many, many, many papers about why it worked and why it didn't, and what was it about Mauritius that was successful. We don't need to get into it. But a lot of the times zones really are just a quarter and a half piece of land with some incentives for the private sector that expire after a certain amount of time and very little in sort of systemic reform or even infrastructure investment.

So you can imagine a scenario where Country A says, alright, we need to bring more jobs, it would be good to have more industry, it would be good if some foreign entities came to help us build some infrastructure because we don't have a lot of money. And you can imagine a scenario where they do that, and that then has an effect on the rest of the country. It sort of, I don't want to say trickles down, but it spreads, right? They sort of, the influence of these outside ideas and methods and jobs has an effect on the rest of the country. That's how it's supposed to work, right? That's the sort of theory of the special economic zone, that you start small and then you can use this as a catalyst for bigger reforms. Usually that's not the case. So that's the good.

And the bad. The bad, I mean, the really bad part of that, is that zones come with, like I said, concessions and those concessions might include lower wages. It might include, you know, not making companies pay into the national insurance system, basically privatizing and deregulating and contributing to this kind of race to the bottom that takes place when you're offshoring jobs and labor and whatnot. To me the really and this has been going on for some time. I don't know if you've read “No Logo” by Naomi Klein, but that was a really wonderful early reporting on these kinds of sweatshop zones.

I think what's even more nefarious than that is when you take this idea of a zone and you apply it not just to a really limited industrial context, but if you, if say, you use it in other domains. So there's a, there are two chapters in the book that talk about this. One is about asylum and offshore refugee detention. So since before the 1990s, but the two big examples that I talk about is Guantanamo Bay in the ‘90s, when there were a lot, there was a whole migrants detention camp there, mostly for Haitian migrants that was like outside of the U.S. Constitution. And then later, piggybacking off of that, Australia's use of Nauru and Manus Island to do much the same thing: intercept people coming by boat, send them off somewhere where Australian law, like American law, doesn't apply, and treating them horribly in a way where there's no accountability at all from the domestic side, because these places aren't on the territory, right?

Gitmo was rented from Cuba, it was offshore, it's also a naval base. Nauru is its own country, Manus Island is part of Papua New Guinea, which is its own country. And so, in both of these cases, the country sending the asylum seekers has plausible deniability. It's not their land, it's not their law, not their problem. And that creates really horrific scenarios for these migrants that, you know, have yet to be, that these countries have yet to be held accountable for it. In fact, in the US, this is considered constitutional.

So, I think that as more and more countries become less and less inclined to take in refugees, we're gonna see this model escalate. The European Union for, I mean, they just announced that they have a massive reduction in the number of irregular quote unquote immigration, but that's because they're pushing people away and paying other countries to keep people from leaving, right? So, it's hardly a reduction in people who want to move. It's really just like, boxing them in elsewhere. And the use of other countries’ territory to control migration I think is not going to go away anytime soon. In fact, I really think that this is how it's going to look for the decades to come. The U.S. did this to this whole Remain in Mexico clip. So I find that really ugly, personally, and I think there's another dimension of this for looking at the horrors of the future, Tyler, and that's on the environmental front.

So there's a chapter in my book about flags of convenience, how shipowners can get around various rules and regulations by renting out the sovereignty of countries that sell their flags. We discussed this briefly before. And a lot of the time this is to do with labor and tax, so cruise ships might want to pay less tax, have fewer labor regulations, and also not comply, American ones might not want to have like ADA-compliant ramps in every side of the ship. And so if they rent a Liberian flag, they can get around that. There's degrees of nefariousness, right? And of course, it depends who you are. If you're in a wheelchair and you want to go on a cruise, you're probably got to choose your ships carefully.

But when it concerns the environmental impact of shipping, particularly when a ship is at the end of its life and it gets decommissioned, to state's credit, many countries, particularly the EU, the U.S., Japan, have realized that shipbreaking is really dirty. It pollutes. It's really bad for the people that do it, and so it needs to be regulated. The issue is that there are ways around that, because again, shipowners or the sort of all-cash buyers that buy the ship from the last shipowner can get around these rules by, again, renting a flag from a place like Palau, which specializes, and I kid you not, in last journey or last voyages. And so these are single-use flags that ship owners will get just for the, this funeral journey from, wherever the last place the ship is, to the shipyard that is the least regulated, often in Pakistan.

And just use that as a final passport of sorts, to get where they need to go, to get around the other regulations that exist. And there's something almost poetic about it. I thought it was, I found it very moving to think of a ship that had been, you know, home to many people and entertainment for many people, and just had, ships have such a rich inner life, you know, and to think that they get stuck with this last, this funeral flag and sent off. And it almost reminded me of the scene in Moby Dick where Queequeg goes off on his raft. And anyway, a lot of poetry there. But it's also really depressing because it just shows how easy it is to get around these regulations. And this doesn't just affect, I mean, we shouldn't accept it if it did just affect the people who are working at these shipbreaking yards. But it has an impact on the whole ocean. This is how these, this is how this works, right? This is how the environment works. And so we should be much more opposed to this. And it's really egregious, I think.

Tyler McBrien: Before I ask my question, since you mentioned trickledown economics, I wanted to just shout out, I think my favorite sentence in the book, which was in the chapter on space law. And you write, did trickledown economics apply in zero gravity conditions? Which I thought was perfect.

But I guess kind of branching off of what you were just saying, something that I was grappling with in reading the book was whether the creation of special rules or constructing laws within laws then render the rule of law or other regulations useless. On the one hand, the initial laws that are being circumvented are themselves constructions, so you could view these other ones as just new constructions. But there is an unsavoriness in people playing by different rules that can make other people want to play by no rules. I'm not sure there's a question here, but I wonder if you had any thoughts on that.

Atossa Araxia Abrahamian: Yeah, I think what you're getting at is like, who ultimately has power? And I want to bring it back to what I said earlier. This is not a stateless world, right? States still have a lot of power. They just wield it selectively. And sometimes it's because maybe, you know, well, Palau created this funeral flag business with one purpose that's pretty clear. But if they wanted to shut it down, they theoretically could, maybe they don't have a lot of resources, but like, it's possible they could just scrap it, right? But they don't. Same with Liberia, same with Panama. All of these jurisdictions that make quite a lot of money off of flags. In a day, they could get rid of this, but they're not going to, right? Because there are really powerful economic interests that might not be, well, in some cases they are writing the law, but they're supporting this whole regime.

So on paper, states can intervene in a heartbeat, but they don't, because the world is a complicated and messy place. I think you could say the same about sanctions, which are extraterritorial, right? There are ways around sanctions and states can find ways to crack down on those ways. But they don't always because things got to keep moving. So states still very much have power, but money talks.

Tyler McBrien: I want to end here where you end in the book, which is in Svalbard, which is part of Norway. Really fascinating rules and laws of that territory. One thing that surprised me though is, I didn't get a strong prescriptive ending chapter, which I was actually happy about, because I feel like often those can be unsatisfactory. But you do, if I'm reading this correctly, actually find some hope in these zones, especially Svalbard, in terms of where we go from here, or ways to mitigate some of these zones’ and extraterritorial domains’ worst externalities, for lack of a better word. So why did you end with Svalbard and what inspiration, if I can use that word, did you find there in terms of its rules and regulations, or lack thereof?

Atossa Araxia Abrahamian: If I were to write a final prescriptive chapter that would be really boring and no one would listen to, it would go something like this: look at how borders are selectively enforced and apply much less to rich people. We should have open borders for everyone since everyone knows they're fake to begin with, right? But like, you can see that's a nonstarter? No one's going to listen to me. And also everyone else is tossing the other opposite. Like that's, I've written a lot about open borders and I truly think it's the only ethical position. But are we going to get there in the next 10, 20, 30, like in my lifetime? I don't know.

What I found really inspiring or at least hopeful, a little bit hopeful about Svalbard is that it is a place that is under the control of Norway, but it has open borders thanks to this weird treaty from 1919, part of the Treaty of Versailles.

And when I found out that there was a territory of Norway in the Arctic that had open borders and anyone could live there, I was like, wow, that's amazing, I got to go. So I found a way to go, went on an art residency. It was really cool.

But I still, I thought the narrative, or whenever I read about it was, that this was kind of, almost an interwar quirk and a triumph of the internationalists, and that this lovely thing came about and, you know, it could happen again, but this is almost contingent on the circumstances.

It was contingent on the circumstances, but it wasn't lovely internationalists huddling together and deciding to have a place for everyone to roam. What turned out to have been the closer to the truth is that coal interests, American coal interests, had been quite active on the, on Svalbard before this territory was handed to Norway and also declared you know, free zone. And the coal interest in question was a fellow named John Monroe Longyear, a Michigander from very far north, I also visited Marquette where he was from. And he was, in the run up to the handover to Norway, Svalbard was terra nullius. It was one of the last places in the world that was unclaimed. And so it was the Wild West there: there were coal miners, there were fur traders, it was just a lot of Arctic activity from all over the world.

And Longyear and his lobbyist were really, really worried that when this territory would no longer be free for all, they would have their property taken away from them. And so if you look at their correspondence with the State Department and with other trading companies, they were really taking such care to document all of their claims, to account for everything they did, just as a way of setting the groundwork to say, hey, this is mine. I was here. Sort of creating a legal claim, almost, in the absence of legal certainty. We're back to this, like wanting to know what the rules are.

And meanwhile Longyear and his lobbyist, who was on K Street, had a K Street address, were writing to the State Department saying, well, what's going on? Like, can you please make sure that we can retain our rights to this coal? Can you please make sure that, like, the Russians don't come in, or the Norwegians? And they had this whole proposal that looked a lot like a charter city, actually, back then. But thanks, I think, in large part to their lobbying, what ended up happening in this treaty is that, that foreign business was given the same rights as Norwegian business, and that foreign citizens were given the same rights as Norwegian citizens.

This is known as this nondiscrimination clause in the treaty. And again, this sounds lovely and like utopian and cosmopolitan, but actually there's a pretty strong evidence that it was because of this guy from Michigan and his lobbyist. So, on the one hand, kind of depressing, right? Like, maybe there is no triumph of internationalism here? But on the other hand, if we can get, if we can sort of eke that out of these pretty dismal special interests, maybe we can eke that out of others, right? Maybe we can create areas with more open borders that are more inclusive, that afford the same rights to people as they do to goods and money. Well, we've got plenty of these dismal goods scenarios today, so maybe that's something to think about.

Tyler McBrien: So maybe not a triumph of internationalism, but perhaps a triumph of the American Midwest, once again.

Atossa Araxia Abrahamian: Haha. Yeah.

Tyler McBrien: I'm about to wrap up, but if there's anything you want to add?

Atossa Araxia Abrahamian: So I will be talking about the book at a few events. I will be in Providence, Rhode Island on November 21st at 6:30 pm, I believe. I will be in Washington, D.C. at Solid State Books at 7 pm and I'll be in Baltimore at 7 pm at Red Emma's Bookstore. And my Twitter is @atossaaraxia. You can also find events there.

Tyler McBrien: Well, Atossa, thank you so much. The book was fascinating, if not a bit disorienting, in the best way. I encourage people to read the book, “The Hidden Globe, How Wealth Hacks the World,” and for any Lawfare listeners in those cities to go to the event. But Atossa, thank you so much for joining me.

Atossa Araxia Abrahamian: Thanks, that was really fun. Great questions.

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