FROM: U.S. DEFENSE DEPARTMENT
Department of Defense Press Briefing by Secretary Hagel at NATO Headquarters, Brussels, Belgium
SECRETARY OF DEFENSE CHUCK HAGEL: Good afternoon.
The NATO [North Atlantic Treaty Organization] defense ministers have just concluded a positive and productive series of meetings. A key focus has been on laying the groundwork for next year's NATO summit, which will enable NATO leaders to set priorities for the future of the alliance. In our discussions, we began to define a forward-looking agenda that will be the base of the content and the efforts and the objectives of the summit next year focusing on strengthening the transatlantic alliance.
We see three priority areas for the summit: capabilities, partnerships, and Afghanistan. Our sessions yesterday focused on NATO military capabilities and the need to continue to invest in these capabilities to meet 21st century challenges.
On cyber, NATO's Computer Incident Response Center is on track to achieve full operational capabilities next week. This center will provide protection from cyber intrusions against NATO computer networks, a capability that was identified as a priority at our June ministerial meeting.
The U.S. supports a proposal for the center to have teams of NATO cyber experts that can be quickly deployed to assist allied nations if they request help in dealing with cyber intrusions or attacks. It was agreed that the alliance must do more to deal with cyber threats, and this will remain a top priority going forward.
On missile defense, the United States continues to meet its commitments to deploy the European Phased Adaptive Approach, and it's on schedule. To continue this progress next week, Undersecretary of Defense for Policy Jim Miller will join NATO leaders at a groundbreaking ceremony for the missile defense radar site in Romania, and then he'll attend a missile defense conference in Poland.
Two decades of experience in the Balkans, Afghanistan, Libya, and off the Somali coast have helped us build NATO forces that can work together seamlessly. We want to preserve that hard-won capability in the future. And that is the goal of NATO's new Connected Forces Initiative. Yesterday, ministers agreed on the key elements of the Connected Forces Initiative. In 2015, the alliance will begin regular large-scale exercises to ensure that our forces continue to gain experience working alongside each other, and even after we draw down combat forces from Afghanistan, we will continue to work together and enhance and enlarge these exercises.
To help NATO maintain a ready force, the U.S. is also increasing its participation in the NATO Response Force, a rapidly deployable, multinational alliance capability. We will begin rotating a battalion-sized unit to Europe twice a year so that we can participate in NATO Response Force training and train with individual allies.
In a few weeks, the United States will deploy U.S.-based forces to support the NATO Response Force Exercise Steadfast Jazz. This will mark the first time the U.S. has sent a ground unit to a NATO Response Force exercise.
These new U.S. commitments to NATO send a strong signal about the importance America places on this alliance. During this ministerial, I stressed the need for our partners to make strong, long-term commitments to NATO. Overdependence on any one country for critical capabilities brings with it risks, and we must continue to work to more equally share the burden of providing security.
Yesterday, ministers agreed to pursue flagship projects for next year's summit that will help balance alliance burdens, while filling capability shortfalls in combat lift, missile defense, and intelligence, surveillance and reconnaissance.
Our work to build effective working partnerships also extends to nations outside of NATO. Today we held the first defense ministerial meeting in several years of the NATO-Russia Council. Russia and NATO have many areas of common interest, including the destruction of Syria's chemical weapons stockpiles.
Following the NATO-Russia Council, I had good bilateral discussions with Russian Defense Minister Shoygu. The cooperation between the United States and Russia on Syria's chemical weapons underscores the benefits that come when our two nations pursue practical cooperation in areas of common interests. In order to help identify other areas for practical cooperation and promote greater transparency, Minister Shoygu and I today agreed to increase consultations with each other and between our staffs. The minister and I will hold regular video teleconferences to ensure these consultations move forward. This new security cooperation channel can help lay a foundation for progress in what's an important military-to-military relationship.
Finally, in today's ISAF [International Security Assistance Force] session, we assessed the progress we are making in Afghanistan toward achieving our security goals. I also discussed this progress yesterday with Afghanistan's defense minister. ISAF nations continue planning for the new train, advise and assist mission to help develop Afghan security capability after 2014. In the session we just completed, ISAF defense ministers endorsed General Breedlove's strategic planning assessment for this new mission.
This document will help the alliance and national governments move ahead with their planning efforts. A post-2014 NATO troop presence will require the approval of the Afghan government, a signed bilateral security agreement [BSA], and a status-of-forces agreement between Afghanistan and NATO.
In the ISAF meeting, I updated ministers on the status of the BSA and the recent progress we've made toward its completion. As we prepare for next year's summit, NATO will continue to focus on the challenges ahead and the new structures and strategies that will be required to deal with them.
Thank you. I'd be glad to take some questions.
PRESS SECRETARY GEORGE LITTLE: We'll start with Lita Baldor of the Associated Press.
Q: Mr. Secretary, we were told yesterday that the Afghan minister expressed confidence that the BSA would be approved. I'm wondering, during your discussions with him, did he also offer any assurances or express equal confidence that the provisions that the U.S. says it needs in the BSA, including the jurisdiction in counterterror operations provisions, would be in the BSA and that there are no real hurdles to that?
And just secondarily, the president initially had said that the end of October was the deadline for approval of the BSA. In your mind right now, can you tell us when you think this actually has to be completed by, end of the year, early next year? Can you just give us a sense of timing?
SEC. HAGEL: First, the minister did note his optimism about the BSA being completed with the language that both countries require. Our position has been very clear on this, especially on jurisdiction. But he was very positive and felt very good about the loya jirga going forward and advising a president to sign it, and then the next event, as you know, would be the ratification by the parliament.
As to the timing, I noted before, obviously, the sooner, the better. We need -- we all need time to plan, prepare. But that planning has been going on. It's been going on here at NATO headquarters for a post-2014 train, advise and assist mission, so that's not new.
But I believe we are on track with a -- right now, a scheduled late November loya jirga session, which should take a few days. I think if that works as we anticipate -- and, as the minister noted yesterday, he believes will -- we could get an agreement fairly soon. The sooner, the better, but we're not waiting for the signed BSA. We're continuing to plan and prepare, as we are with our ISAF NATO partners.
MR. LITTLE: Yes, sir?
Q: Thank you very much. (Inaudible) from the Egyptian Television.
Minister, I have two questions, if you'll allow me. The first, you did agree with the Russian minister about the importance of Geneva II and destroying the chemical weapon, but do you have some other things you disagree with the minister, something you -- it was clearly that you -- (inaudible) -- work together?
And the second, considering the action you did take in Egypt by freezing some military aid, is it a type of measure you take or a type of sanction against Egypt? And when do you think this type of action you can withdraw? Thank you very much.
SEC. HAGEL: Well, regarding Geneva II, yes, we strongly support, as you know, moving forward with Geneva II. I think all of you know Secretary Kerry is in Europe today -- (off-mic.) -- London, I think, yesterday. And we are working with our Russian partners and the other 10 nations involved in this effort. We believe -- and we said it -- I think the Russians feel the same -- that a diplomatic solution, political solution is what's required, going to be required for Syria. So, yes, we strongly agree on the importance of Geneva II.
As to Egypt, the decision that was made regarding some weapons systems for Egypt was a decision to put on hold some of those systems. We announced one of our sophisticated airplanes that, the F-16, which would be put on hold a couple of months ago. Just recently we made some other announcements regarding Apache helicopters, tank kits, and so on.
We have laws in the United States that we must comply with on what are the restrictions and what are the boundaries of our assistance to allies regarding government and human rights. And we comply with those laws. So we're working with the Egyptian government. It's been very clear, the interim government, we believe, is moving in the right direction, road map toward inclusive, free democracy, rights for all people, assuring that all individuals, all citizens of Egypt have the same rights.
So we continue to work with the interim government in Egypt and hope that those rights will be fulfilled and they will continue to make progress on elections, on a new constitution, and a new and inclusive democratic republic. Thank you.
MR. LITTLE: We'll turn to Phil Stewart of Reuters.
Q: Yes, hi, Mr. Secretary.
First, a quick follow-up. You said you would be starting regular video conferences with your Russian counterpart. How often will those be? And why -- when was the last time the secretary had regular conferences? Is this unprecedented or not?
And then on Syria and the destruction of chemical weapons, both the NATO secretary general and the Russian defense minister raised the possibility of some sort of role in doing -- helping eliminate the chemical weapons. What might the United States do to contribute to that, by way of U.S. forces on the ground perhaps? Or what would they -- what would the U.S. do? And then why would it be important, perhaps, for NATO to have a role in that? Thank you.
SEC. HAGEL: On the Russian defense minister and the United States secretary of defense ministerial follow-ups, specifically teleconferences, I don't know if -- if that has occurred in the past. We have not decided on what kind of a regular basis we would do it. Our staffs will be meeting very soon on starting to lay out some kind of a schedule of an agenda, the point being we could use at least the initial teleconferences to, first, as I suggested in the meeting, have a very open, transparent and frank discussion about not just where we agree, but where we disagree, how we might be able to accommodate each other in some of these areas.
Also, I noted that I think it's particularly important that leaders from significant world powers have some regular occasion to talk to each other to anticipate problems, to anticipate issues that may be coming, rather than waiting for a crisis and then -- then we are forced together to communicate because of a crisis, something's blowing up in the world. Aren't we wiser to try to get out ahead of that, anticipate that, talk through some of these issues?
We have differences. We're going to continue to have differences. But I think it's always smarter and better for everyone if -- not only can we anticipate some of these big issues that may be coming, these challenges, threats, but also deal directly with our differences and find common interests and enhance ways where we can cooperate when we do have common interest.
As to your second question, I think -- if we can continue to see progress made, and I believe everybody believes we can, in destroying chemical weapons in Syria, then it seems to me that this is going to open opportunities for a lot of nations to play roles in -- in Syria in order to accomplish the objective.
It may well be that NATO will be asked for some assistance. Right now, as you know, the OPCW [Organization for the Prohibition of Chemical Weapons] has the lead here. The United Nations is involved. And I think it would probably be something we would assume would occur if we can stay on track and make progress, like we believe we can, that other nations would be asked for help. And maybe -- it may be NATO. As to specifically your question about U.S. involvement, there are no plans to have any U.S. forces in any way in Syria.
MR. LITTLE: And the gentleman in the front row will have the final question.
Q: (Inaudible) from (Inaudible).
Was it Mr. Shoygu's initiative for this media conference thing? Because I know that he likes these videoconferences. He had them a lot -- worked a lot when he was emergency minister in Russia. And will this be replacing or adding up to the existing two-plus-two format?
SEC. HAGEL: Thank you. Yes, as to your first question, Mr. Shoygu has had a lot of experience with these, and they've been very effective and productive for him. I've used videoconferences over many, many years in different jobs I've had. I think they are productive. They are effective. We use them all the time, National Security Council with the president. It is a good way to stay connected.
Some of you may recall that, when we did have the two-plus-two in Washington, we actually mentioned this, that we were going to see if there was a possibility if we could pursue it. So what we did today was we followed up on some general thoughts that Minister Shoygu and I had in our initial meeting before the two-plus-two, which we had just -- we had an hour alone before the two-plus-two. So this was a follow-up from that idea that we each kind of came to. And I thought it was -- the timing was right. Obviously, Minister Shoygu thought the timing was right.
So, again, this is -- it seems to me -- one of the examples that can be used and should be used to take advantage of areas where we can agree, where we can anticipate and get out ahead, and where we -- we can enlarge and scope things out, where we could have more participants in something like this effort in Syria and chemical weapons.
But this teleconference -- just being one -- but this teleconference and videoconference that we would have would be not limited to any specific area, as I think I outlined some of the areas that we would have some interest in. And he's very receptive to that. I'm very receptive. I think he and I have a similar pattern, a style of doing business.
MR. LITTLE: And that will conclude our business today. Thank you, everyone.
SEC. HAGEL: Thank you very much. Thanks.
Thursday, October 24, 2013
CFTC CHAIRMAN GENSLER'S LECTURE AT WHARTON LEADERSHIP LECTURE SERIES
FROM: U.S. COMMODITY FUTURES TRADING COMMISSION
Remarks of CFTC Chairman Gary Gensler Before the Wharton Leadership Lecture Series
October 15, 2013
Good afternoon and hello Quakers. I thank Justin for that very kind introduction. I also want to thank my dear friend and your classmate, Scott Schneider, for suggesting to Wharton to invite me here to speak.
It is a great honor to be asked back to speak at Wharton, my alma mater.
After cartoonist, Gary Trudeau, delivered our commencement address – and my parents headed back to Baltimore – I didn’t have much on my mind other than a particular girl who was visiting and heading over to Smokey Joe’s.
So I can safely say that when I left West Philadelphia thirty-four years ago, I did not contemplate that one day I might be asked to return to share thoughts on leadership.
I have been fortunate to live a very full live – with some success and a lot of dumb luck – in both the private sector and in public service. For 18 years, I worked in the investment banking business in New York and Tokyo before joining President Clinton’s administration at the Treasury Department. Now, as Chairman of the Commodity Futures Trading Commission, I’m honored to head an agency that regulates America’s commodities and derivatives markets and to work to bring much needed reforms to the nation’s financial system.
I feel completely honored to serve this nation and to have served two presidents. I’ve been thinking about what I could say that might have some relevance to you. I could share stories about tough merger negotiations while on Wall Street or meetings in the Oval Office. The event planners, though, asked me to talk about leadership principles and experiences - some positive … some negative – that I have found most valuable since leaving Wharton. In essence, what worked and what did not?
And though the most important role I have and ever will play is as a husband and as a father of three wonderful daughters, I imagine that the organizers wish that I stick to thoughts on the world of business and politics.
Though, I hope that you will allow me to muse about some personal thoughts as well.
Here are some of the most critical lessons that I’ve learned in my career since leaving Wharton 34 years ago:
First, pursue your passions.
I have seen people in careers not passionate about their work. Don’t do that. Instead, find what you love the most and try and make a go at it.
I feel very fortunate. Neither of my parents went to college. After World War II, my dad used his mustering out pay to buy some used beat up vending machines. He later placed cigarette machines and pinball machines in local Baltimore bars. I used to travel with him when he would take the nickels out of the machines and help him count them. I guess you could say this was my first foray into business and the world of finance.
I knew from that early age that I wanted to pursue a career in business. At the same time, I felt a deep passion for politics and government, so I sought to merge those two dreams. I lost my campaign for senior class president in high school, but I kept alive my passion.
I chose to apply to the Wharton School to pursue those dreams. It was a lot easier, though, to get into college back in 1975. Nearly 25 of my high school classmates went on to the University of Pennsylvania. Not to mention, I had actually gotten a D in high school French.
At college, I once again got involved in student politics, being appointed the student representative on the University Budget Committee. I am glad to know the University still follows the tradition. Particularly, given that along with other students I actually participated in a four-day sit-in of College Hall in 1978 protesting the University’s cut of the hockey program. We were unsuccessful saving the varsity hockey program … but it did subsequently return as a club sport. Are there any Wharton Wildmen here?
I graduated from Penn with a bachelor’s degree and an MBA and followed my passion into business in New York. In 18 years on Wall Street, I became a partner at Goldman Sachs, worked in Tokyo for three years and met countless talented people. From there I moved to the Treasury Department where I could merge my experience in finance with my desire to be in public service. After President Obama was elected, I was honored to be asked to serve again in a new role.
Each of you may have different passions or dreams. Some of you may wish to be at large firms and others at small start-ups. Some will wish to pursue new technologies and some not. Some may have an interest in public service as I did, and many won’t. And some of you may have no idea what you want to do. It may take time to reveal itself, but whatever your passion is or whenever it develops, follow it.
I married an artist whose true passion was creating images. In her 20s, though, Francesca went off to Columbia for her MBA. She later was able to reconnect with her passion in her 40s. When she returned to it, she produced wonderful art that was featured in the Corcoran Gallery of Art and the Getty Museum in Los Angeles. So if your passion is art, do that!
Second, make your opportunities, and seize them.
Sometimes life presents us with great new opportunities. You should take them. Often, however, you have to make your own opportunities. That often requires a willingness to take risk.
I think that Sheryl Sandberg’s view that “careers are a jungle gym, not a ladder” is very apt. I had the great pleasure of serving with Sheryl in President Clinton’s Treasury Department. As that Administration ended, frankly, neither of us knew what we were likely to do next.
Initially I moved to Baltimore, co-authored a book, joined some boards and helped out on some campaigns. Francesca’s cancer returned and I spent increasing amounts of cherished time with my girls and her. After Francesca passed away, I became a stay-at-home dad doing the laundry, buying the groceries and making sure the dogs were fed.
When Hillary Clinton was preparing to run for president - that’s for 2008 - I told Hillary that I wanted to help her in any way I could. Hillary hesitated to let me join, though, unless I could assure her the girls would be OK. It finally took four conversations with Hillary and several months for me to persuade her that I could fulfill my responsibilities as a dad in Baltimore and commute to Arlington for her campaign every day.
As for Sheryl, after a bit of time off and some soul searching she moved to California for a job at Google, which had but 400 employees at the time and still ranked 15th among web sites. Shall we just say the rest is for the history books?
Getting to a senior role in government, as well, requires taking risk and pursuing it. Every candidate for office does so when they put their name in front of voters. So too, do those interested in appointed office. Whether one works hard for a candidate on a campaign or is an expert in a particular field, you have to actively pursue the job. A Presidential Transition or White House has hundreds of thousands of resumes to review, so the person who ends up in a senior role must actually hit the phones, schedule meetings, take risks and make their case as to why they want to serve and in what role.
Taking advantage of an opportunity can mean big changes. It might require you to move to a new place or leave a job you like. But those changes can bring you success and happiness. Follow them.
Third, find mentors.
I would not have been invited to speak here today if not for the help of mentors along the way. My first mentors were my mom and dad who encouraged me through every step of school, taught me great values and showed me what a loving lifelong relationship can be.
When I was at Penn, I sought the counsel of my professors, but particularly three with whom I became very close. One of them, Professor Jamshed Ghandi, is still a member of your faculty. He was a remarkable teacher, who was the first to clearly explain to me the role and function of financial intermediation in our economy. To this day, I remember some of the most important advice Jamshed and the others gave me. I also recall when as a result of a little wager, Professor Ghandi and I had to play a game of Jacks on the ground along Locust Walk.
Another mentor at Wharton was Dean Don Carroll and, maybe even more so, his assistant Elli Page. Each semester I wanted to take one more class than allowed. So at the start of every semester, I went to the dean’s office and begged Elli to let me talk to him. I ended up graduating with my bachelor’s and master’s is four years because Elli kept getting me signoff to take those extra classes. To this day, I don’t know if it was the dean’s signature or Elli’s forgery.
Another mentor at Wharton was a woman a year ahead of me in school and about six years my senior. We first met in Professor Ghandi’s class on financial intermediation. She had spent a summer working on Wall Street and helped get me interviews. She was furious when she found out that I went to my first job interview in jeans, for the Boston Consulting Group, no less. I didn’t own a suit and hoped it was all right if I didn’t wear one!
Straight away, she called my dad and asked permission to take me shopping. We went to Brooks Brothers and she helped me buy my first suit. Somehow I ended up getting a job at Goldman Sachs.
Goldman took a risk on a young 21-year-old kid. I made many mistakes – mistakes of youth, mistakes of inexperience and sometimes mistakes of arrogance. But I also had mentors at the firm who looked after me and gave me much-needed guidance.
One of the mentors who knew me pretty well at Goldman Sachs later became Treasury Secretary for President Clinton. I ended up working with him at Treasury, but, let me tell you, he didn’t just call me one day to offer me the job. Secretary Rubin had joined the Administration four years before I did. I stayed in touch over those years, and made sure he knew about my willingness to serve if an opportunity presented itself. He asked me to join the team as an assistant secretary and gave me the opportunity to fulfill my passion for public service.
You too will undoubtedly meet many talented people in the future who share your passions. Learn from them. Seek advice from those who have done what you want to do. Build off of those relationships.
Fourth, every time you take on a new role, right at the beginning, articulate one clear goal and write it down on a Post-it note.
All too often I have seen individuals being consumed by others’ agendas rather than their own. This is true in the private sector as well as the public sector. Beware of letting your competitors or events overwhelm how your days are spent.
Within a month of taking on a new role make sure that you clearly define your number one goal. Write it down on a Post-it note and put it in your desk drawer. Every day, open up the drawer and ask yourself “what have I done today to move forward on this goal?”
Every job includes mundane duties that, if not appropriately managed, can consume you. Every role has competitors trying to throw your organization and you off your game. Leadership, though, is about completing tasks in the face of all of these challenges and distractions, most importantly to do so towards your high priority goal – the one on your Post-it note.
Further, in pursuing your goal, know the difference between strategies and tactics. Far too often, talented people fill meetings discussing tactics without tying them to an agreed upon strategy. Tactics are critical, but only as they fit in with a well-articulated strategy.
During my first year at the CFTC, we set out a strategy of advocating that Congress enact comprehensive regulatory reform of over-the-counter derivatives, or swaps. Our tactics included giving speeches, providing Congress with legislative and technical assistance, placing opinion pieces in leading newspapers and actively working with coalitions of supporters outside of Congress.
We did not lose track of our strategy in favor of focusing on a particular tactic. We did not write op/eds for the sake of getting them published; rather, we only wrote op/eds if they fit into our larger strategy. Success depended on remaining steadfastly focused on our goals and our strategy.
Fifth, spend time learning about the practical bits of management.
Spending nearly $60,000 per year on tuition, you might be hoping to learn something about management. I might hope so, too, as your tuition has grown nearly twenty fold since I was a freshman at Wharton. Yes, tuition was only $3,430 per year in 1975! I’m not sure that would even cover your books!
I believe that one only truly learns about management, though, when finally doing it. When you get to that first management role, be sure to spend lots of time with your people. Communicate with and mentor them. Set clear goals.
Learn from those in your organization who do it well. Here are three key management lessons I learned from others along the way:
The first is simply the importance of keeping lists. I recall when I first saw Bob Rubin pull out his yellow pad and jot down a list. He was always doing it. Lists of tasks that needed to be done. Lists or relevant information that he needed for a decision. Lists of people to call. And he constantly followed-up with his staff on those lists, holding folks accountable and paying attention to the details of his lists. Try it on an iPad if you wish, but make those lists.
The other list man I learned from was Neil Armstrong. I kid you not. I met and befriended Neil Armstrong when advising an Ohio media company in the mid-1980s. As you all know, he was a remarkable man, but, when I worked with him, he also was the ultimate low ego, cool, quiet man, but under pressure, he just kept calm and got the job done.
When I once asked him if he enjoyed the views passing time on the way to the moon, he looked at me and said, “Gary, what I was always doing was reviewing in my head the next ten things I had to do on my checklist.” He was the ultimate list man, though he did admit to having enjoyed a few peeks back at the Earth along the way.
The second was from one of the best managers at Goldman Sachs. He spent a considerable amount of time on how to arrange the organization into boxes around clear lines of authority and accountability. He then spent even more time on getting the right people with the right skills for each of the “boxes.”
I kept this lesson at the forefront when I joined the CFTC with a clear goal on the Post-it note of enacting robust comprehensive swaps market reforms. That is why one of our first critical hires was an extraordinarily talented young speechwriter and former debater to help guide a public advocacy effort for reform. He’s one of your classmates, Scott Schneider.
The third lesson is the importance of identifying value drivers gating factors. Find those things in your organization that create value or are the constraint for higher performance. And then change the factor to open up the gate and create value.
Once Congress finalized financial reform in the Dodd Frank Act, at the CFTC we had to find a way to write and implement more than 60 new rules, though the agency was gravely underfunded and had never completed more than five rules in a year. We went after every gating factor we could find to move such a significant amount of reform “inventory.” We set up an entirely new team structure, new means of public openness and methods of outside regulatory consultations. Now we’ve nearly completed writing all the new Dodd-Frank rules, and financial institutions are coming into compliance with this new regulatory infrastructure. This would not have been possible had we not removed the gating factors at the CFTC.
Lastly, find a good partner.
I married Francesca, a beautiful woman I met at a party in New York four years after Wharton. We lost her to cancer seven years ago, but every minute of our 20 years of marriage was a blessing. We moved from New York to Tokyo to New York to Washington to Baltimore and had three beautiful daughters. So find a good partner in life. It does take work and a lot of communication, but life really is better with a good partner.
Before I close, I want to acknowledge that Wharton equipped me with many of the tools I needed both in the private sector and in public service. It was a remarkable experience that helped prepare me for each of my roles in business and government.
Thank you again for inviting me here today. I’d be glad to take any questions that you may have.
Remarks of CFTC Chairman Gary Gensler Before the Wharton Leadership Lecture Series
October 15, 2013
Good afternoon and hello Quakers. I thank Justin for that very kind introduction. I also want to thank my dear friend and your classmate, Scott Schneider, for suggesting to Wharton to invite me here to speak.
It is a great honor to be asked back to speak at Wharton, my alma mater.
After cartoonist, Gary Trudeau, delivered our commencement address – and my parents headed back to Baltimore – I didn’t have much on my mind other than a particular girl who was visiting and heading over to Smokey Joe’s.
So I can safely say that when I left West Philadelphia thirty-four years ago, I did not contemplate that one day I might be asked to return to share thoughts on leadership.
I have been fortunate to live a very full live – with some success and a lot of dumb luck – in both the private sector and in public service. For 18 years, I worked in the investment banking business in New York and Tokyo before joining President Clinton’s administration at the Treasury Department. Now, as Chairman of the Commodity Futures Trading Commission, I’m honored to head an agency that regulates America’s commodities and derivatives markets and to work to bring much needed reforms to the nation’s financial system.
I feel completely honored to serve this nation and to have served two presidents. I’ve been thinking about what I could say that might have some relevance to you. I could share stories about tough merger negotiations while on Wall Street or meetings in the Oval Office. The event planners, though, asked me to talk about leadership principles and experiences - some positive … some negative – that I have found most valuable since leaving Wharton. In essence, what worked and what did not?
And though the most important role I have and ever will play is as a husband and as a father of three wonderful daughters, I imagine that the organizers wish that I stick to thoughts on the world of business and politics.
Though, I hope that you will allow me to muse about some personal thoughts as well.
Here are some of the most critical lessons that I’ve learned in my career since leaving Wharton 34 years ago:
First, pursue your passions.
I have seen people in careers not passionate about their work. Don’t do that. Instead, find what you love the most and try and make a go at it.
I feel very fortunate. Neither of my parents went to college. After World War II, my dad used his mustering out pay to buy some used beat up vending machines. He later placed cigarette machines and pinball machines in local Baltimore bars. I used to travel with him when he would take the nickels out of the machines and help him count them. I guess you could say this was my first foray into business and the world of finance.
I knew from that early age that I wanted to pursue a career in business. At the same time, I felt a deep passion for politics and government, so I sought to merge those two dreams. I lost my campaign for senior class president in high school, but I kept alive my passion.
I chose to apply to the Wharton School to pursue those dreams. It was a lot easier, though, to get into college back in 1975. Nearly 25 of my high school classmates went on to the University of Pennsylvania. Not to mention, I had actually gotten a D in high school French.
At college, I once again got involved in student politics, being appointed the student representative on the University Budget Committee. I am glad to know the University still follows the tradition. Particularly, given that along with other students I actually participated in a four-day sit-in of College Hall in 1978 protesting the University’s cut of the hockey program. We were unsuccessful saving the varsity hockey program … but it did subsequently return as a club sport. Are there any Wharton Wildmen here?
I graduated from Penn with a bachelor’s degree and an MBA and followed my passion into business in New York. In 18 years on Wall Street, I became a partner at Goldman Sachs, worked in Tokyo for three years and met countless talented people. From there I moved to the Treasury Department where I could merge my experience in finance with my desire to be in public service. After President Obama was elected, I was honored to be asked to serve again in a new role.
Each of you may have different passions or dreams. Some of you may wish to be at large firms and others at small start-ups. Some will wish to pursue new technologies and some not. Some may have an interest in public service as I did, and many won’t. And some of you may have no idea what you want to do. It may take time to reveal itself, but whatever your passion is or whenever it develops, follow it.
I married an artist whose true passion was creating images. In her 20s, though, Francesca went off to Columbia for her MBA. She later was able to reconnect with her passion in her 40s. When she returned to it, she produced wonderful art that was featured in the Corcoran Gallery of Art and the Getty Museum in Los Angeles. So if your passion is art, do that!
Second, make your opportunities, and seize them.
Sometimes life presents us with great new opportunities. You should take them. Often, however, you have to make your own opportunities. That often requires a willingness to take risk.
I think that Sheryl Sandberg’s view that “careers are a jungle gym, not a ladder” is very apt. I had the great pleasure of serving with Sheryl in President Clinton’s Treasury Department. As that Administration ended, frankly, neither of us knew what we were likely to do next.
Initially I moved to Baltimore, co-authored a book, joined some boards and helped out on some campaigns. Francesca’s cancer returned and I spent increasing amounts of cherished time with my girls and her. After Francesca passed away, I became a stay-at-home dad doing the laundry, buying the groceries and making sure the dogs were fed.
When Hillary Clinton was preparing to run for president - that’s for 2008 - I told Hillary that I wanted to help her in any way I could. Hillary hesitated to let me join, though, unless I could assure her the girls would be OK. It finally took four conversations with Hillary and several months for me to persuade her that I could fulfill my responsibilities as a dad in Baltimore and commute to Arlington for her campaign every day.
As for Sheryl, after a bit of time off and some soul searching she moved to California for a job at Google, which had but 400 employees at the time and still ranked 15th among web sites. Shall we just say the rest is for the history books?
Getting to a senior role in government, as well, requires taking risk and pursuing it. Every candidate for office does so when they put their name in front of voters. So too, do those interested in appointed office. Whether one works hard for a candidate on a campaign or is an expert in a particular field, you have to actively pursue the job. A Presidential Transition or White House has hundreds of thousands of resumes to review, so the person who ends up in a senior role must actually hit the phones, schedule meetings, take risks and make their case as to why they want to serve and in what role.
Taking advantage of an opportunity can mean big changes. It might require you to move to a new place or leave a job you like. But those changes can bring you success and happiness. Follow them.
Third, find mentors.
I would not have been invited to speak here today if not for the help of mentors along the way. My first mentors were my mom and dad who encouraged me through every step of school, taught me great values and showed me what a loving lifelong relationship can be.
When I was at Penn, I sought the counsel of my professors, but particularly three with whom I became very close. One of them, Professor Jamshed Ghandi, is still a member of your faculty. He was a remarkable teacher, who was the first to clearly explain to me the role and function of financial intermediation in our economy. To this day, I remember some of the most important advice Jamshed and the others gave me. I also recall when as a result of a little wager, Professor Ghandi and I had to play a game of Jacks on the ground along Locust Walk.
Another mentor at Wharton was Dean Don Carroll and, maybe even more so, his assistant Elli Page. Each semester I wanted to take one more class than allowed. So at the start of every semester, I went to the dean’s office and begged Elli to let me talk to him. I ended up graduating with my bachelor’s and master’s is four years because Elli kept getting me signoff to take those extra classes. To this day, I don’t know if it was the dean’s signature or Elli’s forgery.
Another mentor at Wharton was a woman a year ahead of me in school and about six years my senior. We first met in Professor Ghandi’s class on financial intermediation. She had spent a summer working on Wall Street and helped get me interviews. She was furious when she found out that I went to my first job interview in jeans, for the Boston Consulting Group, no less. I didn’t own a suit and hoped it was all right if I didn’t wear one!
Straight away, she called my dad and asked permission to take me shopping. We went to Brooks Brothers and she helped me buy my first suit. Somehow I ended up getting a job at Goldman Sachs.
Goldman took a risk on a young 21-year-old kid. I made many mistakes – mistakes of youth, mistakes of inexperience and sometimes mistakes of arrogance. But I also had mentors at the firm who looked after me and gave me much-needed guidance.
One of the mentors who knew me pretty well at Goldman Sachs later became Treasury Secretary for President Clinton. I ended up working with him at Treasury, but, let me tell you, he didn’t just call me one day to offer me the job. Secretary Rubin had joined the Administration four years before I did. I stayed in touch over those years, and made sure he knew about my willingness to serve if an opportunity presented itself. He asked me to join the team as an assistant secretary and gave me the opportunity to fulfill my passion for public service.
You too will undoubtedly meet many talented people in the future who share your passions. Learn from them. Seek advice from those who have done what you want to do. Build off of those relationships.
Fourth, every time you take on a new role, right at the beginning, articulate one clear goal and write it down on a Post-it note.
All too often I have seen individuals being consumed by others’ agendas rather than their own. This is true in the private sector as well as the public sector. Beware of letting your competitors or events overwhelm how your days are spent.
Within a month of taking on a new role make sure that you clearly define your number one goal. Write it down on a Post-it note and put it in your desk drawer. Every day, open up the drawer and ask yourself “what have I done today to move forward on this goal?”
Every job includes mundane duties that, if not appropriately managed, can consume you. Every role has competitors trying to throw your organization and you off your game. Leadership, though, is about completing tasks in the face of all of these challenges and distractions, most importantly to do so towards your high priority goal – the one on your Post-it note.
Further, in pursuing your goal, know the difference between strategies and tactics. Far too often, talented people fill meetings discussing tactics without tying them to an agreed upon strategy. Tactics are critical, but only as they fit in with a well-articulated strategy.
During my first year at the CFTC, we set out a strategy of advocating that Congress enact comprehensive regulatory reform of over-the-counter derivatives, or swaps. Our tactics included giving speeches, providing Congress with legislative and technical assistance, placing opinion pieces in leading newspapers and actively working with coalitions of supporters outside of Congress.
We did not lose track of our strategy in favor of focusing on a particular tactic. We did not write op/eds for the sake of getting them published; rather, we only wrote op/eds if they fit into our larger strategy. Success depended on remaining steadfastly focused on our goals and our strategy.
Fifth, spend time learning about the practical bits of management.
Spending nearly $60,000 per year on tuition, you might be hoping to learn something about management. I might hope so, too, as your tuition has grown nearly twenty fold since I was a freshman at Wharton. Yes, tuition was only $3,430 per year in 1975! I’m not sure that would even cover your books!
I believe that one only truly learns about management, though, when finally doing it. When you get to that first management role, be sure to spend lots of time with your people. Communicate with and mentor them. Set clear goals.
Learn from those in your organization who do it well. Here are three key management lessons I learned from others along the way:
The first is simply the importance of keeping lists. I recall when I first saw Bob Rubin pull out his yellow pad and jot down a list. He was always doing it. Lists of tasks that needed to be done. Lists or relevant information that he needed for a decision. Lists of people to call. And he constantly followed-up with his staff on those lists, holding folks accountable and paying attention to the details of his lists. Try it on an iPad if you wish, but make those lists.
The other list man I learned from was Neil Armstrong. I kid you not. I met and befriended Neil Armstrong when advising an Ohio media company in the mid-1980s. As you all know, he was a remarkable man, but, when I worked with him, he also was the ultimate low ego, cool, quiet man, but under pressure, he just kept calm and got the job done.
When I once asked him if he enjoyed the views passing time on the way to the moon, he looked at me and said, “Gary, what I was always doing was reviewing in my head the next ten things I had to do on my checklist.” He was the ultimate list man, though he did admit to having enjoyed a few peeks back at the Earth along the way.
The second was from one of the best managers at Goldman Sachs. He spent a considerable amount of time on how to arrange the organization into boxes around clear lines of authority and accountability. He then spent even more time on getting the right people with the right skills for each of the “boxes.”
I kept this lesson at the forefront when I joined the CFTC with a clear goal on the Post-it note of enacting robust comprehensive swaps market reforms. That is why one of our first critical hires was an extraordinarily talented young speechwriter and former debater to help guide a public advocacy effort for reform. He’s one of your classmates, Scott Schneider.
The third lesson is the importance of identifying value drivers gating factors. Find those things in your organization that create value or are the constraint for higher performance. And then change the factor to open up the gate and create value.
Once Congress finalized financial reform in the Dodd Frank Act, at the CFTC we had to find a way to write and implement more than 60 new rules, though the agency was gravely underfunded and had never completed more than five rules in a year. We went after every gating factor we could find to move such a significant amount of reform “inventory.” We set up an entirely new team structure, new means of public openness and methods of outside regulatory consultations. Now we’ve nearly completed writing all the new Dodd-Frank rules, and financial institutions are coming into compliance with this new regulatory infrastructure. This would not have been possible had we not removed the gating factors at the CFTC.
Lastly, find a good partner.
I married Francesca, a beautiful woman I met at a party in New York four years after Wharton. We lost her to cancer seven years ago, but every minute of our 20 years of marriage was a blessing. We moved from New York to Tokyo to New York to Washington to Baltimore and had three beautiful daughters. So find a good partner in life. It does take work and a lot of communication, but life really is better with a good partner.
Before I close, I want to acknowledge that Wharton equipped me with many of the tools I needed both in the private sector and in public service. It was a remarkable experience that helped prepare me for each of my roles in business and government.
Thank you again for inviting me here today. I’d be glad to take any questions that you may have.
SEC COMMISSIONER AGUILAR'S REMARKS ON INTERNET AND THE ACCESS TO CAPITAL
FROM: SECURITIES AND EXCHANGE COMMISSION
Harnessing the Internet to Promote Access to Capital for Small Businesses, While Protecting the Interests of Investors
Commissioner Luis A. Aguilar
Washington, D.C.
Oct. 23, 2013
Today, the Commission is proposing new rules to implement Title III of the JOBS Act, which exempts qualifying crowdfunding transactions from the registration and prospectus delivery requirements of the Securities Act.[1] The new Regulation Crowdfunding is expected to be used primarily by small companies. As is well known, although personal savings is the largest source of capital for most start-ups, external financing is very important to many small and medium-sized businesses.[2] Unfortunately, as is also well known, many small businesses have difficulty finding external capital.[3] It is worth noting that the need for outside investment is even greater among minority entrepreneurs, who tend to have lower personal wealth than their non-minority counterparts.[4]
Supporters of crowdfunding believe that it may offer a potential solution to the small business funding problem.[5] Observers point to the success of existing crowdfunding services around the world, which raised almost $2.7 billion in 2012, an increase of more than 80% from the prior year.[6]
However, even the strongest supporters of crowdfunding acknowledge that it carries substantial risks.[7] Small business investing is inherently risky and, the fact is, the majority of new business establishments fail.[8] Research indicates that, in the U.S., about 70% of initial venture-capital investments lose money.[9] Moreover, small business investments tend to be highly illiquid, as most securities offerings may be too small for an active secondary trading market to develop.[10] As a result, crowdfunding investors must be prepared to hold and bear the risk of their investments indefinitely.
In addition to these risks, commenters, including state securities regulators, have noted that small business investments may pose relatively high risks of fraud, and may afford the potential for self-dealing or overreaching by controlling shareholders.[11]
As contemplated by the JOBS Act and our proposed rules, the hope is that such risks will be minimized by the disclosures that will be required under Regulation Crowdfunding, and by the individual and aggregate investment limits to be imposed in such offerings. It is also hoped that the risks will be further offset by the gatekeeping role of the crowdfunding intermediary—a registered broker-dealer or registered funding portal—which sits between the investor and the issuer. Under the proposed rules, the crowdfunding intermediary is required to keep an eye out for fraud and to have a reasonable basis for believing that the issuer has complied with the requirements of the exemption.[12] The crowdfunding intermediary will also provide a forum for information sharing, with communications by an issuer or paid promoter clearly identified as such. However, it is acknowledged that, while those and other proposed conditions may possibly reduce harm, they can never eliminate the risks.[13]
Many believe that, if structured appropriately, crowdfunding can bring great benefits to our economy. However, for crowdfunding to have a positive impact on the small business funding problem, it must work for both issuers and investors. In particular, it is vitally important that investors have confidence in the crowdfunding process—or they will stay away. The need for both investor protection and investor confidence is why Section 302(c) of the JOBS Act specifically directs the Commission to issue such rules “as the Commission determines may be necessary or appropriate for the protection of investors” to carry out the statutory exemption.[14] As we enter the public comment process for this rulemaking, it will be important to hear from investor advocates if the proposed rules have enough safeguards built-in to protect investors from fraud and self-dealing and to provide them with confidence that they are being dealt with fairly and honestly.
The use of crowdfunding to reach potentially vulnerable segments of society is a particular concern. Many of the SEC’s enforcement cases arise from “affinity frauds” that exploit the trust and friendship that often exists among members of any ethnic, religious, or other community.[15] Given the possibility that crowdfunding may facilitate affinity fraud by making it easier to identify and target vulnerable groups, I would urge the Commission’s enforcement staff and state securities regulators to take a proactive approach to monitor the crowdfunding space for potential problems. In that regard, I am pleased to note that the North American Securities Administrators Association announced the formation of a task force on Internet fraud investigations shortly after the enactment of the JOBS Act.[16]
Clearly, all investments bear some degree of risk. However, to the extent that crowdfunding increases the risks of fraud, illiquidity, and self-dealing to relatively unsophisticated investors, it will be incumbent upon the Commission and state securities regulators to take appropriate measures. Problems that arise from the actions of crowdfunding issuers or portals could generally affect investor confidence in the capital markets and have an adverse effect on capital formation.
It is therefore essential that the Commission work to establish this new financing technique in a responsible manner. Because of the importance of small business funding, I support the issuance of this proposal. However, I recognize that crowdfunding may entail substantial risks. I look forward to public comments, particularly from investors and investor advocates, as to how the rules can be improved. I also note that Title III of the JOBS Act expressly requires that, in carrying out the rulemaking required to implement the crowdfunding exemption, the Commission shall consult with the state securities commissions.[17] To that end, I look forward to hearing from state regulators.
I thank the staff for their hard work on this proposal.
[1] Crowdfunding can be defined as using the Internet to raise small investments from a large number of investors. See, C. Steven Bradford, Crowdfunding and the Federal Securities Laws, 2012 Colum. Bus. L. Rev. 1, 10. Title III of the JOBS Act amended the Securities Act of 1933 (the “Securities Act”) to add Section 4(a)(6) and Section 4A to the Securities Act. Together, these new sections establish the foundation for a regulatory structure for the offering and sale of securities through crowdfunding. See, Jumpstart Our Business Startups Act, Pub. L. No. 112-106, 126 Stat. 306 (2012) (the “JOBS Act”). The rules proposed today would both govern the offer and sale of securities in transactions that qualify for the crowdfunding exemption and create a framework for the regulation of crowdfunding platforms.
[2] Ewing Marion Kauffman Foundation, 2013 State of Entrepreneurship Address (February 5, 2013), p.2, http://www.kauffman.org/uploadedFiles/DownLoadableResources/SOE Report_2013pdf.pdf . Many entrepreneurs max out their credit cards, or take loans or investments from friends and family; others rely on trade credit and other forms of vendor financing, or seek commercial bank loans and lines of credit. See, Alicia M. Robb and David Robinson, The Capital Structure Decisions of New Firms, Ewing Marion Kauffman Foundation (November 2008), http://www.kauffman.org/uploadedfiles/Capital_Structure_Decisions_New_Firms.pdf .
[3] A 2012 study by the National Small Business Association found that 43% of small business owners surveyed could not get the financing they needed. National Small Business Association, Small Business Access to Capital Survey (July 11, 2012), p. 4, http://www.nsba.biz/wp-content/uploads/2012/07/Access-to-Capital-Survey.pdf .
[4] U.S. Department of Commerce, Minority Business Development Agency, Disparities in Capital Access between Minority and Non-Minority-Owned Businesses: The Troubling Reality of Capital Limitations Faced by MBEs (January 2010), pp. 6-8, et seq., http://www.mbda.gov/sites/default/files/DisparitiesinCapitalAccessReport.pdf. Women and persons of color also face additional obstacles raising outside capital for their small businesses. See, Board of Governors of the Federal Reserve System, Report to the Congress on the Availability of Credit to Small Businesses (September 2012), pp. 42-45, http://www.federalreserve.gov/publications/other-reports/files/sbfreport2012.pdf; supra note 23, pp. 19-22.
[5] See, e.g. Bradford, p. 5.
[6] Today, crowdfunding platforms in the U.S. generally operate on a “pre-sale” or “donation-and-reward” model, in which participants contribute to a project they wish to support in exchange for a copy of the finished work or some other token of thanks. See, Kent Bernhard Jr., Crowdfunding’s tally: $2.6 B in 2012 and growing, Upstart Business Journal (April 8, 2013), http://upstart.bizjournals.com/money/loot/2013/04/08/crowdfundings-tally-26-b-in-2012.html .
[7] See, e.g. Bradford, pp. 9, 99.
[8] See, Bureau of Labor Statistics, Business Employment Dynamics, Entrepreneurship and the U.S. Economy, http://www.bls.gov/bdm/entrepreneurship/entrepreneurship.htm.
[9] Telephone Interview by Marc Leaf, Counsel to Commissioner Luis A. Aguilar, with Shikhar Ghosh, Senior Lecturer, Mel Tukman Faculty Fellow, Harvard Business School (October 22, 2013). See, Deborah Gage, The Venture Capital Secret: 3 Out of 4 Start-Ups Fail, The Wall Street Journal (September 20, 2012), http://online.wsj.com/news/articles/SB10000872396390443720204578004980476429190 (citing research by Shikhar Ghosh).
[10] See, e.g. Bradford, pp. 9, 99; see, also, Dina ElBoghdady, “‘Crowdfunding’ trend poised to make mark on U.S. investing landscape,” The Washington Post (April 29, 2013), available at http://articles.washingtonpost.com/2013-04-29/business/38902177_1_crowdfunding-small-businesses-investors (citing NASAA president Heath Abshure).
[11] See, e.g. Bradford, pp. 9, 99. See, also, letter from Andrea L. Seidt, Commissioner, Ohio Division of Securities (January 9, 2013), available at http://www.sec.gov/comments/jobs-title-iii/jobstitleiii-199.pdf (crowdfunding provides investors with “almost no bargaining power and little information”).
[12] See, Crowdfunding, Release No. 33-XXXX (October 23, 2013) (the “Proposing Release”). The crowdfunding intermediary is required, at a minimum, to conduct a background and securities enforcement regulatory history check on each issuer and its officers, directors and 20% beneficial owners, and must deny access to its platform if (i) the intermediary believes that the issuer or the offering presents the potential for fraud or otherwise raises concerns regarding investor protection, or (ii) the intermediary believes that it is unable to effectively assess the risk of such fraud. If, after it has granted access to an issuer, an intermediary becomes aware of information that causes it to believe that the issuer or offering presents the potential for fraud, or otherwise raises concerns regarding investor protection, the intermediary must promptly remove the offering from its platform, cancel the offering, and return (or direct the return of) any funds that have been committed by investors in the offering.
[13] Bradford, pp. 9, 99.
[14] JOBS Act § 302(c).
[15] See, e.g., “Investor Bulletin: Affinity Fraud,” SEC Office of Investor Education and Advocacy (September 2012), www.sec.gov/investor/alerts/affinityfraud.pdf.
[16] Press release, “NASAA Sees Sharp Spike in Crowdfunding Presence on the Internet” (December 5, 2012), http://www.nasaa.org/18951/nasaa-sees-sharp-spike-in-crowdfunding-presence-on-the-internet/
[17] JOBS Act § 302(c).
Harnessing the Internet to Promote Access to Capital for Small Businesses, While Protecting the Interests of Investors
Commissioner Luis A. Aguilar
Washington, D.C.
Oct. 23, 2013
Today, the Commission is proposing new rules to implement Title III of the JOBS Act, which exempts qualifying crowdfunding transactions from the registration and prospectus delivery requirements of the Securities Act.[1] The new Regulation Crowdfunding is expected to be used primarily by small companies. As is well known, although personal savings is the largest source of capital for most start-ups, external financing is very important to many small and medium-sized businesses.[2] Unfortunately, as is also well known, many small businesses have difficulty finding external capital.[3] It is worth noting that the need for outside investment is even greater among minority entrepreneurs, who tend to have lower personal wealth than their non-minority counterparts.[4]
Supporters of crowdfunding believe that it may offer a potential solution to the small business funding problem.[5] Observers point to the success of existing crowdfunding services around the world, which raised almost $2.7 billion in 2012, an increase of more than 80% from the prior year.[6]
However, even the strongest supporters of crowdfunding acknowledge that it carries substantial risks.[7] Small business investing is inherently risky and, the fact is, the majority of new business establishments fail.[8] Research indicates that, in the U.S., about 70% of initial venture-capital investments lose money.[9] Moreover, small business investments tend to be highly illiquid, as most securities offerings may be too small for an active secondary trading market to develop.[10] As a result, crowdfunding investors must be prepared to hold and bear the risk of their investments indefinitely.
In addition to these risks, commenters, including state securities regulators, have noted that small business investments may pose relatively high risks of fraud, and may afford the potential for self-dealing or overreaching by controlling shareholders.[11]
As contemplated by the JOBS Act and our proposed rules, the hope is that such risks will be minimized by the disclosures that will be required under Regulation Crowdfunding, and by the individual and aggregate investment limits to be imposed in such offerings. It is also hoped that the risks will be further offset by the gatekeeping role of the crowdfunding intermediary—a registered broker-dealer or registered funding portal—which sits between the investor and the issuer. Under the proposed rules, the crowdfunding intermediary is required to keep an eye out for fraud and to have a reasonable basis for believing that the issuer has complied with the requirements of the exemption.[12] The crowdfunding intermediary will also provide a forum for information sharing, with communications by an issuer or paid promoter clearly identified as such. However, it is acknowledged that, while those and other proposed conditions may possibly reduce harm, they can never eliminate the risks.[13]
Many believe that, if structured appropriately, crowdfunding can bring great benefits to our economy. However, for crowdfunding to have a positive impact on the small business funding problem, it must work for both issuers and investors. In particular, it is vitally important that investors have confidence in the crowdfunding process—or they will stay away. The need for both investor protection and investor confidence is why Section 302(c) of the JOBS Act specifically directs the Commission to issue such rules “as the Commission determines may be necessary or appropriate for the protection of investors” to carry out the statutory exemption.[14] As we enter the public comment process for this rulemaking, it will be important to hear from investor advocates if the proposed rules have enough safeguards built-in to protect investors from fraud and self-dealing and to provide them with confidence that they are being dealt with fairly and honestly.
The use of crowdfunding to reach potentially vulnerable segments of society is a particular concern. Many of the SEC’s enforcement cases arise from “affinity frauds” that exploit the trust and friendship that often exists among members of any ethnic, religious, or other community.[15] Given the possibility that crowdfunding may facilitate affinity fraud by making it easier to identify and target vulnerable groups, I would urge the Commission’s enforcement staff and state securities regulators to take a proactive approach to monitor the crowdfunding space for potential problems. In that regard, I am pleased to note that the North American Securities Administrators Association announced the formation of a task force on Internet fraud investigations shortly after the enactment of the JOBS Act.[16]
Clearly, all investments bear some degree of risk. However, to the extent that crowdfunding increases the risks of fraud, illiquidity, and self-dealing to relatively unsophisticated investors, it will be incumbent upon the Commission and state securities regulators to take appropriate measures. Problems that arise from the actions of crowdfunding issuers or portals could generally affect investor confidence in the capital markets and have an adverse effect on capital formation.
It is therefore essential that the Commission work to establish this new financing technique in a responsible manner. Because of the importance of small business funding, I support the issuance of this proposal. However, I recognize that crowdfunding may entail substantial risks. I look forward to public comments, particularly from investors and investor advocates, as to how the rules can be improved. I also note that Title III of the JOBS Act expressly requires that, in carrying out the rulemaking required to implement the crowdfunding exemption, the Commission shall consult with the state securities commissions.[17] To that end, I look forward to hearing from state regulators.
I thank the staff for their hard work on this proposal.
[1] Crowdfunding can be defined as using the Internet to raise small investments from a large number of investors. See, C. Steven Bradford, Crowdfunding and the Federal Securities Laws, 2012 Colum. Bus. L. Rev. 1, 10. Title III of the JOBS Act amended the Securities Act of 1933 (the “Securities Act”) to add Section 4(a)(6) and Section 4A to the Securities Act. Together, these new sections establish the foundation for a regulatory structure for the offering and sale of securities through crowdfunding. See, Jumpstart Our Business Startups Act, Pub. L. No. 112-106, 126 Stat. 306 (2012) (the “JOBS Act”). The rules proposed today would both govern the offer and sale of securities in transactions that qualify for the crowdfunding exemption and create a framework for the regulation of crowdfunding platforms.
[2] Ewing Marion Kauffman Foundation, 2013 State of Entrepreneurship Address (February 5, 2013), p.2, http://www.kauffman.org/uploadedFiles/DownLoadableResources/SOE Report_2013pdf.pdf . Many entrepreneurs max out their credit cards, or take loans or investments from friends and family; others rely on trade credit and other forms of vendor financing, or seek commercial bank loans and lines of credit. See, Alicia M. Robb and David Robinson, The Capital Structure Decisions of New Firms, Ewing Marion Kauffman Foundation (November 2008), http://www.kauffman.org/uploadedfiles/Capital_Structure_Decisions_New_Firms.pdf .
[3] A 2012 study by the National Small Business Association found that 43% of small business owners surveyed could not get the financing they needed. National Small Business Association, Small Business Access to Capital Survey (July 11, 2012), p. 4, http://www.nsba.biz/wp-content/uploads/2012/07/Access-to-Capital-Survey.pdf .
[4] U.S. Department of Commerce, Minority Business Development Agency, Disparities in Capital Access between Minority and Non-Minority-Owned Businesses: The Troubling Reality of Capital Limitations Faced by MBEs (January 2010), pp. 6-8, et seq., http://www.mbda.gov/sites/default/files/DisparitiesinCapitalAccessReport.pdf. Women and persons of color also face additional obstacles raising outside capital for their small businesses. See, Board of Governors of the Federal Reserve System, Report to the Congress on the Availability of Credit to Small Businesses (September 2012), pp. 42-45, http://www.federalreserve.gov/publications/other-reports/files/sbfreport2012.pdf; supra note 23, pp. 19-22.
[5] See, e.g. Bradford, p. 5.
[6] Today, crowdfunding platforms in the U.S. generally operate on a “pre-sale” or “donation-and-reward” model, in which participants contribute to a project they wish to support in exchange for a copy of the finished work or some other token of thanks. See, Kent Bernhard Jr., Crowdfunding’s tally: $2.6 B in 2012 and growing, Upstart Business Journal (April 8, 2013), http://upstart.bizjournals.com/money/loot/2013/04/08/crowdfundings-tally-26-b-in-2012.html .
[7] See, e.g. Bradford, pp. 9, 99.
[8] See, Bureau of Labor Statistics, Business Employment Dynamics, Entrepreneurship and the U.S. Economy, http://www.bls.gov/bdm/entrepreneurship/entrepreneurship.htm.
[9] Telephone Interview by Marc Leaf, Counsel to Commissioner Luis A. Aguilar, with Shikhar Ghosh, Senior Lecturer, Mel Tukman Faculty Fellow, Harvard Business School (October 22, 2013). See, Deborah Gage, The Venture Capital Secret: 3 Out of 4 Start-Ups Fail, The Wall Street Journal (September 20, 2012), http://online.wsj.com/news/articles/SB10000872396390443720204578004980476429190 (citing research by Shikhar Ghosh).
[10] See, e.g. Bradford, pp. 9, 99; see, also, Dina ElBoghdady, “‘Crowdfunding’ trend poised to make mark on U.S. investing landscape,” The Washington Post (April 29, 2013), available at http://articles.washingtonpost.com/2013-04-29/business/38902177_1_crowdfunding-small-businesses-investors (citing NASAA president Heath Abshure).
[11] See, e.g. Bradford, pp. 9, 99. See, also, letter from Andrea L. Seidt, Commissioner, Ohio Division of Securities (January 9, 2013), available at http://www.sec.gov/comments/jobs-title-iii/jobstitleiii-199.pdf (crowdfunding provides investors with “almost no bargaining power and little information”).
[12] See, Crowdfunding, Release No. 33-XXXX (October 23, 2013) (the “Proposing Release”). The crowdfunding intermediary is required, at a minimum, to conduct a background and securities enforcement regulatory history check on each issuer and its officers, directors and 20% beneficial owners, and must deny access to its platform if (i) the intermediary believes that the issuer or the offering presents the potential for fraud or otherwise raises concerns regarding investor protection, or (ii) the intermediary believes that it is unable to effectively assess the risk of such fraud. If, after it has granted access to an issuer, an intermediary becomes aware of information that causes it to believe that the issuer or offering presents the potential for fraud, or otherwise raises concerns regarding investor protection, the intermediary must promptly remove the offering from its platform, cancel the offering, and return (or direct the return of) any funds that have been committed by investors in the offering.
[13] Bradford, pp. 9, 99.
[14] JOBS Act § 302(c).
[15] See, e.g., “Investor Bulletin: Affinity Fraud,” SEC Office of Investor Education and Advocacy (September 2012), www.sec.gov/investor/alerts/affinityfraud.pdf.
[16] Press release, “NASAA Sees Sharp Spike in Crowdfunding Presence on the Internet” (December 5, 2012), http://www.nasaa.org/18951/nasaa-sees-sharp-spike-in-crowdfunding-presence-on-the-internet/
[17] JOBS Act § 302(c).
Wednesday, October 23, 2013
READOUT: SECRETARY HAGEL'S MEETING WITH RUSSIAN MINISTER OF DEFENSE SERGEY SHOYGU
FROM: U.S. DEFENSE DEPARTMENT
Readout of Secretary Hagel's Meeting with Russian Minister of Defense Sergey Shoygu
Pentagon Press Secretary George Little provided the following readout:
Secretary of Defense Chuck Hagel met with Russia's Minister of Defense Sergey Shoygu today during the North Atlantic Treaty Organization (NATO) Defense Ministerial in Brussels, Belgium.
The leaders discussed a range of issues of mutual interest, to include updates from the August 2+2 meeting, the rationale for pursuing missile defense cooperation, the situation in Syria, and the United States' and Russia's shared interest in supporting security and stability in Afghanistan post 2014.
Secretary Hagel assured Minister Shoygu that the United States' missile defense efforts pose no threat to Russia, and he encouraged Russia to consider joint initiatives that increase transparency and provide for mutually beneficial cooperation; enhancing our mutual strategic stability.
Secretary Hagel highlighted the progress in the implementation of the U.S.-Russia Framework, and the important strides made to reach consensus on how to address Syria's chemical weapons program. He encouraged Minister Shoygu to continue working with Syria to ensure its full cooperation with the United Nations and the Organization for the Prohibition of Chemical Weapons.
Readout of Secretary Hagel's Meeting with Russian Minister of Defense Sergey Shoygu
Pentagon Press Secretary George Little provided the following readout:
Secretary of Defense Chuck Hagel met with Russia's Minister of Defense Sergey Shoygu today during the North Atlantic Treaty Organization (NATO) Defense Ministerial in Brussels, Belgium.
The leaders discussed a range of issues of mutual interest, to include updates from the August 2+2 meeting, the rationale for pursuing missile defense cooperation, the situation in Syria, and the United States' and Russia's shared interest in supporting security and stability in Afghanistan post 2014.
Secretary Hagel assured Minister Shoygu that the United States' missile defense efforts pose no threat to Russia, and he encouraged Russia to consider joint initiatives that increase transparency and provide for mutually beneficial cooperation; enhancing our mutual strategic stability.
Secretary Hagel highlighted the progress in the implementation of the U.S.-Russia Framework, and the important strides made to reach consensus on how to address Syria's chemical weapons program. He encouraged Minister Shoygu to continue working with Syria to ensure its full cooperation with the United Nations and the Organization for the Prohibition of Chemical Weapons.
SECRETARY OF DEFENSE HAGEL AND NATO DEFENSE MINISTER GATHER
FROM: U.S. DEFENSE DEPARTMENT
Hagel, NATO Defense Ministers Gather at 'Inflection Point'
By Karen Parrish
American Forces Press Service
BRUSSELS, Oct. 22, 2013 - NATO defense ministers are meeting this week as the alliance faces what many here call an inflection point: how to preserve hard-earned NATO operational capabilities while winding down operations in Afghanistan over the coming months.
Defense Secretary Chuck Hagel attended separate meetings today with several of his counterparts. Pentagon Press Secretary George Little said that Hagel spoke earlier with Afghan Defense Minister Bismullah Khan Mohammadi. Little said Hagel commended the progress the Afghan national security forces have made this year, as they assumed the lead in providing security for the Afghan people.
"Secretary Hagel stressed there is still work to be done to address Afghanistan's security challenges, and it remains critical for Afghanistan to sign the bilateral security agreement to enable continuing partnership between U.S. and Afghan armed forces," Little said.
The press secretary said Hagel emphasized to Mohammadi that concluding the agreement, continuing development of Afghan forces and conducting a secure, credible, and inclusive election are all in Afghanistan's long-term interests.
"Secretary Hagel underscored that the U.S. armed forces look forward to continuing to work with [Afghan forces] to pursue Afghan security," Little said.
A defense official who attended the meeting told reporters on background that Mohammadi expressed strong confidence that the bilateral agreement would be wrapped up soon, and that the vast majority of Afghans support it.
The official stressed that Hagel emphasized to Mohammadi that jurisdiction over U.S. troops is a critical, non-negotiable element of that agreement.
U.S. forces around the world serve under agreements negotiated between the United States and host countries that stipulate that any criminal charges those troops face will be handled by the American military justice system or U.S. courts. The bilateral security agreement between the United States and Afghanistan reportedly hinges on this provision.
Earlier this month, Secretary of State John F. Kerry and Afghan President Hamid Karzai met in the Afghan capital of Kabul to discuss the bilateral security agreement. Both leaders said the issue of U.S. jurisdiction for U.S. troops will be brought before the Loya Jirga, or council of Afghan elders, which Karzai has called to meet in November.
A senior U.S. military official here speaking to reporters on background said the Loya Jirga's recommendation will then be referred to Afghanistan's parliament, which has the power to ratify the agreement.
Hagel was firm in today's meeting with Mohammadi, the defense official said, "that jurisdiction is a must for the BSA, and that any issues between the two countries should be resolved privately and not publicly."
Hagel also met here today with Australian Defense Minister David Johnston in their first face-to-face meeting since Johnston recently assumed his new position in the Australian government. Little said the secretary reaffirmed the strong U.S.-Australia alliance, the importance of deepening U.S.-Australian defense cooperation across a range of security challenges, and the value of the rotational U.S. military presence in Australia.
"The secretary expressed deep appreciation for Australia's contributions to the [International Security Assistance Force] mission in Afghanistan, and is looking forward to next month's Australia-United States ministerial consultation in Washington," Little said.
Hagel also met with Canadian Defense Minister Rob Nicholson, another first-time in-person meeting, Little said. Hagel emphasized the importance he places on U.S.-Canadian defense cooperation, and thanked Canada for being a strong ally, friend and neighbor, the press secretary reported.
Little said Hagel and Nicholson discussed the two nations' close security cooperation in the Western Hemisphere and beyond, as well as the importance of investing in NATO and continuing with NATO reform efforts.
Hagel thanked the minister for Canada's support for the international effort in Afghanistan, and the two defense leaders discussed the progress being made in the mission there, as well as the challenges that remain, Little said.
"Secretary Hagel said he looks forward to making his first visit to Canada in his capacity as secretary of defense next month, when he will participate in the Halifax Security Forum," the press secretary said.
Little told reporters Hagel also met with Hungarian Defense Minister Csaba Hende, discussing bilateral cooperation, the importance of supporting security and stability in Afghanistan post 2014, defense budgets and planning, and the current situation in Syria.
Little said the leaders noted the recent 20th anniversary of the State Partnership Program between the Hungarian Defense Forces and the Ohio National Guard, which has seen multiple joint deployments in support of ISAF in Afghanistan.
Hagel recognized Hungary's long-standing contributions in Afghanistan, notably its special operations forces support, Little said, as well as the Hungarian military's force protection mission at Kabul International Airport.
"Secretary Hagel and Minister Hende also discussed the situation in Syria, and the importance of the international community's efforts to work together to secure and destroy Syria's chemical weapons," Little said. "The leaders agreed to remain in contact as the situation evolves."
Hagel's engagements here will continue tomorrow, when his schedule includes a meeting of the NATO-Russia Council and a one-on-one meeting with Russian Defense Minister Sergei Shoygu. The secretary also is scheduled for other meetings and a news conference here tomorrow.
Hagel, NATO Defense Ministers Gather at 'Inflection Point'
By Karen Parrish
American Forces Press Service
BRUSSELS, Oct. 22, 2013 - NATO defense ministers are meeting this week as the alliance faces what many here call an inflection point: how to preserve hard-earned NATO operational capabilities while winding down operations in Afghanistan over the coming months.
Defense Secretary Chuck Hagel attended separate meetings today with several of his counterparts. Pentagon Press Secretary George Little said that Hagel spoke earlier with Afghan Defense Minister Bismullah Khan Mohammadi. Little said Hagel commended the progress the Afghan national security forces have made this year, as they assumed the lead in providing security for the Afghan people.
"Secretary Hagel stressed there is still work to be done to address Afghanistan's security challenges, and it remains critical for Afghanistan to sign the bilateral security agreement to enable continuing partnership between U.S. and Afghan armed forces," Little said.
The press secretary said Hagel emphasized to Mohammadi that concluding the agreement, continuing development of Afghan forces and conducting a secure, credible, and inclusive election are all in Afghanistan's long-term interests.
"Secretary Hagel underscored that the U.S. armed forces look forward to continuing to work with [Afghan forces] to pursue Afghan security," Little said.
A defense official who attended the meeting told reporters on background that Mohammadi expressed strong confidence that the bilateral agreement would be wrapped up soon, and that the vast majority of Afghans support it.
The official stressed that Hagel emphasized to Mohammadi that jurisdiction over U.S. troops is a critical, non-negotiable element of that agreement.
U.S. forces around the world serve under agreements negotiated between the United States and host countries that stipulate that any criminal charges those troops face will be handled by the American military justice system or U.S. courts. The bilateral security agreement between the United States and Afghanistan reportedly hinges on this provision.
Earlier this month, Secretary of State John F. Kerry and Afghan President Hamid Karzai met in the Afghan capital of Kabul to discuss the bilateral security agreement. Both leaders said the issue of U.S. jurisdiction for U.S. troops will be brought before the Loya Jirga, or council of Afghan elders, which Karzai has called to meet in November.
A senior U.S. military official here speaking to reporters on background said the Loya Jirga's recommendation will then be referred to Afghanistan's parliament, which has the power to ratify the agreement.
Hagel was firm in today's meeting with Mohammadi, the defense official said, "that jurisdiction is a must for the BSA, and that any issues between the two countries should be resolved privately and not publicly."
Hagel also met here today with Australian Defense Minister David Johnston in their first face-to-face meeting since Johnston recently assumed his new position in the Australian government. Little said the secretary reaffirmed the strong U.S.-Australia alliance, the importance of deepening U.S.-Australian defense cooperation across a range of security challenges, and the value of the rotational U.S. military presence in Australia.
"The secretary expressed deep appreciation for Australia's contributions to the [International Security Assistance Force] mission in Afghanistan, and is looking forward to next month's Australia-United States ministerial consultation in Washington," Little said.
Hagel also met with Canadian Defense Minister Rob Nicholson, another first-time in-person meeting, Little said. Hagel emphasized the importance he places on U.S.-Canadian defense cooperation, and thanked Canada for being a strong ally, friend and neighbor, the press secretary reported.
Little said Hagel and Nicholson discussed the two nations' close security cooperation in the Western Hemisphere and beyond, as well as the importance of investing in NATO and continuing with NATO reform efforts.
Hagel thanked the minister for Canada's support for the international effort in Afghanistan, and the two defense leaders discussed the progress being made in the mission there, as well as the challenges that remain, Little said.
"Secretary Hagel said he looks forward to making his first visit to Canada in his capacity as secretary of defense next month, when he will participate in the Halifax Security Forum," the press secretary said.
Little told reporters Hagel also met with Hungarian Defense Minister Csaba Hende, discussing bilateral cooperation, the importance of supporting security and stability in Afghanistan post 2014, defense budgets and planning, and the current situation in Syria.
Little said the leaders noted the recent 20th anniversary of the State Partnership Program between the Hungarian Defense Forces and the Ohio National Guard, which has seen multiple joint deployments in support of ISAF in Afghanistan.
Hagel recognized Hungary's long-standing contributions in Afghanistan, notably its special operations forces support, Little said, as well as the Hungarian military's force protection mission at Kabul International Airport.
"Secretary Hagel and Minister Hende also discussed the situation in Syria, and the importance of the international community's efforts to work together to secure and destroy Syria's chemical weapons," Little said. "The leaders agreed to remain in contact as the situation evolves."
Hagel's engagements here will continue tomorrow, when his schedule includes a meeting of the NATO-Russia Council and a one-on-one meeting with Russian Defense Minister Sergei Shoygu. The secretary also is scheduled for other meetings and a news conference here tomorrow.
PAYMENTS CONTINUED TO FARMERS WITH ENVIRONMENTALLY SENSITIVE LAND
FROM: U.S. DEPARTMENT OF AGRICULTURE
USDA Issues Conservation Reserve Program Rental Payments, Direct Payments and ACRE Payments
WASHINGTON, Oct. 21, 2013 — Agriculture Secretary Tom Vilsack announced that USDA has begun distributing Conservation Reserve Program (CRP) annual rental payments to participants across the country. USDA also will distribute 2013 direct payments and 2012 Average Crop Revenue Election (ACRE) program payments beginning Oct. 24. Payments originally were scheduled to be issued earlier in the month, but were delayed by several weeks due to the lapse in Federal funding.
“Farmers, ranchers and rural landowners across the country count on USDA programs and the payment delays due to the shutdown were an unnecessary burden,” Vilsack said. “USDA has prioritized making these scheduled payments without any further delay and Farm Service Agency staff have worked hard to get this assistance out the door as quickly as possible.”
Producers will receive payments on almost 700,000 CRP contracts on 390,000 farms covering 26.8 million acres. In exchange for a yearly rental payment provided by USDA on contracts ranging from 10 to 15 years, farmers and ranchers enrolled in CRP agree to remove environmentally sensitive land from agricultural production and plant grasses or trees that will improve water quality and improve waterfowl and wildlife habitat. CRP reduced runoff and leaching of nitrogen and phosphorus into waterways by an estimated 605 million pounds and 121 million pounds, respectively, in 2012, and soil erosion reductions totaling 308 million tons in 2012.
Direct payments for 2013 for the DCP and ACRE programs are being made to the more than 1.7 million farms enrolled in the Farm Service Agency’s programs. Producers with base acres of certain commodities are eligible for DCP payments. ACRE payments for 2012-crop barley, corn, grain sorghum, lentils, oats, peanuts, dry peas, soybeans, and wheat are scheduled to be released beginning Oct. 24 and contingent upon national average market prices and yields in each state. ACRE payments for large chickpeas, small chickpeas, canola, crambe, flaxseed, mustard seed, rapeseed, safflower, sesame, and sunflowers are scheduled to be made in early December and for long grain rice and medium and short grain rice in early February 2014 when the final 2012/13 market year average price data becomes available.
The 2008 Farm Bill, extended by the American Tax Payer Relief Act of 2012, provides authority to enroll land in DCP, ACRE and CRP through Sept. 30, 2013, however, no legislation has been enacted to reauthorize or extend this authority. Effective Oct. 1, 2013, FSA does not have legislative authority to approve or process applications for these programs.
USDA Issues Conservation Reserve Program Rental Payments, Direct Payments and ACRE Payments
WASHINGTON, Oct. 21, 2013 — Agriculture Secretary Tom Vilsack announced that USDA has begun distributing Conservation Reserve Program (CRP) annual rental payments to participants across the country. USDA also will distribute 2013 direct payments and 2012 Average Crop Revenue Election (ACRE) program payments beginning Oct. 24. Payments originally were scheduled to be issued earlier in the month, but were delayed by several weeks due to the lapse in Federal funding.
“Farmers, ranchers and rural landowners across the country count on USDA programs and the payment delays due to the shutdown were an unnecessary burden,” Vilsack said. “USDA has prioritized making these scheduled payments without any further delay and Farm Service Agency staff have worked hard to get this assistance out the door as quickly as possible.”
Producers will receive payments on almost 700,000 CRP contracts on 390,000 farms covering 26.8 million acres. In exchange for a yearly rental payment provided by USDA on contracts ranging from 10 to 15 years, farmers and ranchers enrolled in CRP agree to remove environmentally sensitive land from agricultural production and plant grasses or trees that will improve water quality and improve waterfowl and wildlife habitat. CRP reduced runoff and leaching of nitrogen and phosphorus into waterways by an estimated 605 million pounds and 121 million pounds, respectively, in 2012, and soil erosion reductions totaling 308 million tons in 2012.
Direct payments for 2013 for the DCP and ACRE programs are being made to the more than 1.7 million farms enrolled in the Farm Service Agency’s programs. Producers with base acres of certain commodities are eligible for DCP payments. ACRE payments for 2012-crop barley, corn, grain sorghum, lentils, oats, peanuts, dry peas, soybeans, and wheat are scheduled to be released beginning Oct. 24 and contingent upon national average market prices and yields in each state. ACRE payments for large chickpeas, small chickpeas, canola, crambe, flaxseed, mustard seed, rapeseed, safflower, sesame, and sunflowers are scheduled to be made in early December and for long grain rice and medium and short grain rice in early February 2014 when the final 2012/13 market year average price data becomes available.
The 2008 Farm Bill, extended by the American Tax Payer Relief Act of 2012, provides authority to enroll land in DCP, ACRE and CRP through Sept. 30, 2013, however, no legislation has been enacted to reauthorize or extend this authority. Effective Oct. 1, 2013, FSA does not have legislative authority to approve or process applications for these programs.
READOUT: DEFENSE SECRETARY HAGEL'S MEETING WITH CANADIAN MINISTER OF NATIONAL DEFENSE ROB NICHOLSON
FROM: U.S. DEFENSE DEPARTMENT
Readout of Secretary Hagel's Meeting With Canadian Minister of National Defense Rob Nicholson
This afternoon in Brussels, Secretary Hagel met with Canadian Minister of National Defense Rob Nicholson. This was their first in-person meeting since Minister Nicholson assumed his new role.
Secretary Hagel emphasized the importance he places on U.S.-Canadian defense cooperation, and thanked Canada for being a strong ally, friend and neighbor. They discussed the important work of NORAD, our close security cooperation in the Western Hemisphere and beyond, as well as the importance of investing in NATO and continuing with NATO reform efforts.
Secretary Hagel thanked the minister for Canada's support for the international effort in Afghanistan, and they discussed the progress being made in the mission there, as well as the challenges that remain.
Secretary Hagel said he looks forward to making his first visit to Canada in his capacity as secretary of defense next month, when he will participate in the Halifax Security Forum.
Readout of Secretary Hagel's Meeting With Canadian Minister of National Defense Rob Nicholson
This afternoon in Brussels, Secretary Hagel met with Canadian Minister of National Defense Rob Nicholson. This was their first in-person meeting since Minister Nicholson assumed his new role.
Secretary Hagel emphasized the importance he places on U.S.-Canadian defense cooperation, and thanked Canada for being a strong ally, friend and neighbor. They discussed the important work of NORAD, our close security cooperation in the Western Hemisphere and beyond, as well as the importance of investing in NATO and continuing with NATO reform efforts.
Secretary Hagel thanked the minister for Canada's support for the international effort in Afghanistan, and they discussed the progress being made in the mission there, as well as the challenges that remain.
Secretary Hagel said he looks forward to making his first visit to Canada in his capacity as secretary of defense next month, when he will participate in the Halifax Security Forum.
DOE ANNOUNCES $4.6 MILLION IN GRANTS FOR RESEARCH TO MAKES LIVES BETTER FOR DISABLED
FROM: U.S. EDUCATION DEPARTMENT
$4.6 Million in Grants Awarded for Research Projects Aimed at Helping Improve Lives of People with Disabilities
OCTOBER 21, 2013
The U.S. Department of Education announced today the award of more than $4.6 million in grants to five institutions for research projects aimed at helping improve the lives of people with disabilities. The grant money was disbursed before the recent government shutdown and was not affected by the temporary lapse in funding.
"Through these projects, we hope to conduct research, develop projects and provide technical assistance and training – all aimed at helping better the lives of individuals with disabilities," said U.S. Secretary of Education Arne Duncan. "All of these efforts are intended to fulfill the goal of inclusion, integration, employment and self-sufficiency for people with disabilities."
The grants are being awarded under the Rehabilitation Engineering Research Centers (RERC) Program. The recipients will conduct programs of advanced research of an engineering or technical nature designed to apply technology, scientific achievement and psychological and social knowledge to solve rehabilitation problems and remove environmental barriers.
The grants include:
The Board of Regents of the University of Wisconsin System (CFDA 81.133E-4) -- $925,000.
Regents of the University of Michigan (CFDA 81.133E-5) -- $923,442
Rehabilitation Institute of Chicago (RIC) - (CFDA 81.133E-5) -- $924,937
Rehabilitation Institute of Chicago (RIC) - (CFDA 81.133E-7) -- $924,939
Carnegie Mellon University - (CFDA 81.133E-8) -- $923,878
In recent years, a variety of products have been created through the RERC program to help people with disabilities, including accessible kiosks, voting booths and ATM machines. The program has also help fund "talking signs" for the blind community and hand-held hearing screening devices to screen for hearing loss in newborns, infants, young children and other difficult to test people.
$4.6 Million in Grants Awarded for Research Projects Aimed at Helping Improve Lives of People with Disabilities
OCTOBER 21, 2013
The U.S. Department of Education announced today the award of more than $4.6 million in grants to five institutions for research projects aimed at helping improve the lives of people with disabilities. The grant money was disbursed before the recent government shutdown and was not affected by the temporary lapse in funding.
"Through these projects, we hope to conduct research, develop projects and provide technical assistance and training – all aimed at helping better the lives of individuals with disabilities," said U.S. Secretary of Education Arne Duncan. "All of these efforts are intended to fulfill the goal of inclusion, integration, employment and self-sufficiency for people with disabilities."
The grants are being awarded under the Rehabilitation Engineering Research Centers (RERC) Program. The recipients will conduct programs of advanced research of an engineering or technical nature designed to apply technology, scientific achievement and psychological and social knowledge to solve rehabilitation problems and remove environmental barriers.
The grants include:
The Board of Regents of the University of Wisconsin System (CFDA 81.133E-4) -- $925,000.
Regents of the University of Michigan (CFDA 81.133E-5) -- $923,442
Rehabilitation Institute of Chicago (RIC) - (CFDA 81.133E-5) -- $924,937
Rehabilitation Institute of Chicago (RIC) - (CFDA 81.133E-7) -- $924,939
Carnegie Mellon University - (CFDA 81.133E-8) -- $923,878
In recent years, a variety of products have been created through the RERC program to help people with disabilities, including accessible kiosks, voting booths and ATM machines. The program has also help fund "talking signs" for the blind community and hand-held hearing screening devices to screen for hearing loss in newborns, infants, young children and other difficult to test people.
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