GeoLegal Notes - Weekly Watch #1 by Sean West / Hence Technologies
Each week, I will round up and analyze the top stories that matter at the intersection of law and global affairs.
Thanks to all who digested and shared my 2024 GeoLegal Outlook. If you missed it, it’s the best place to start - a long form look at the top themes that matter at the intersection of law and politics this year. You can catch up now. I’ll have some decaf and standby.
Welcome back. Starting with this issue, I’ll be providing a weekly wrap of the top stories at the same intersection, with some analysis to spark conversation. This week I analyze:
2024 Outlooks from excellent forecasters
South Africa vs. Israel at the ICJ
The US Corporate Transparency Act
Other People’s Outlooks
The turn of the year is prime time for all economic and political analysts to make big calls for the year, and 2024 is no different. My alma mater, Eurasia Group, generates considerable fanfare around its Top Risks outlook. EG’s number one risk for the year relates to the “United States vs. Itself” and takes the lens of the 2024 election as a test for American democracy. EG’s Risk 4 “Ungoverned AI” aligns with the AI analysis we offered in our Outlook but raises the additional consideration that government attention is finite and leaders may lose interest in AI, which is an important point. EG’s Risk 10 “Culture Wars” has a good summary of how culture wars turn into legal battles and is worth a read. You can watch Ian Bremmer explain all the risks for TED below.
Tina Fordham, with whom I’ve been hosting a series of conference calls on geopolitical and legal risk, highlights in her new Navigator that a core strategy for corporations this year is to focus on “plausible hypotheticals” - those outcomes that have a 10% or more chance of happening. This is particularly important for legal leaders when the year presents so many opportunities for politics to manifest itself through the legal system.
Finally, in a private client note, Marko Papic, whose macro analysis at Clocktower Group integrates politics and monetary policy, makes a sizeable call that the Federal Reserve is biased toward leniency and will keep the economy greased due to its own perceptions of political risk. To me, this implies that the Fed will play more of a safety net role amid the uncertainty of 2024 than a brake on growth, as it had threatened to be more recently. This is good news for the US economy and businesses depending on it. You can watch more below.
South Africa vs. Israel at the ICJ
The UN’s judicial body, the International Court of Justice, is considering a request by South Africa to order Israel to stop or alter its military action in Gaza on the basis of claims of genocide. While a final ruling would take years, interim orders will come quicker. There’s a lot to analyze about the legal dimensions of the case itself; for instance, Jesse Lempel writes a compelling piece on how interpretations of Israel’s right to self-defense play into the court’s analysis. The core takeaway, however, is that this is a legal approach that depends on politics to be successful. Neither final nor provisional rulings can actually be enforced by the Court or the UN, as seen when the Court ordered Russia to stop attacks in Ukraine in 2022 or the Court ordered Israel to remove its West Bank barrier 20 years ago. So the core goal here is to leverage global public opinion and pressure on Israel to modify course - but failure of it do so in such a case could further undermine the human rights legal regime. David Simon, Yale’s Genocide Studies Program Director, has an interesting op-ed which outlines how rule of law would be weakened under many potential outcomes of the case, supporting our broader Rule of Law Recession theme from our 2024 Outlook.
Know your Customer
Jamie Schafer, a partner at Perkins Coie, has an interesting op-ed in the FT about how as of 1 January, the US Corporate Transparency Act imposes potential liability on lawyers, accountants and other “gatekeepers” for creating US entities that end up being used for money laundering. In effect, lawyers end up being reported to the government as “company applicants” and are attached to the entities they create for future tracking. These types of requirements are in line with our 2024 Outlook Theme “Guilt by Representation”, whereby lawyers will be increasingly held accountable for choices of who they represent.
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-SW