The heightened interest in cryptocurrencies across the Gulf is taking place alongside global efforts to both regulate digital assets and attract cryptocurrency firms.
The U.S. Congress’ swift and decisive override last week of President Barack Obama’s veto of the Justice Against Sponsors of Terrorism Act (JASTA) may have been momentarily euphoric for the bill’s supporters. The political and emotional power of “justice for the 9/11 families” was reflected in the strikingly lopsided vote tallies. The Senate managed only one vote to sustain the veto – outgoing minority leader Harry Reid, who, tellingly, is retiring this year – and the House of Representatives mustered a mere 77 votes supporting the White House. But the passage of the bill over the president’s objections is unlikely to be the end of this already convoluted story.
Following the override, many members of Congress seemed to experience instantaneous “buyers’ remorse,” as the White House put it, recognizing, as the CIA and Pentagon had warned, that JASTA poses dangers that far outweigh its benefits. Concerns over the possible consequences of the new law emerged immediately following the September 28 veto override, with legislators indicating that they intend to seek additional legislation to “fix” JASTA soon after the November 8 elections. Republican lawmakers, now worried about the implications of a bill they had strongly supported, lost no time in blaming the president.
Majority Leader Mitch McConnell called it a “good example” of the White House’s “failure to communicate early about the potential consequences” of the legislation. He acknowledged that JASTA may well have “unintended ramifications,” but that “it was certainly not something that was going to be fixed this week,” in other words during the veto override process. Another senior Republican senator, Bob Corker, complained that the White House had been unwilling to meet with lawmakers on this issue. He accused the White House of making “zero” efforts to convince lawmakers to sustain the veto. Corker claimed Congress was “only recently informed of the negative impact of this bill on our service members and on our diplomats.”
And, indeed, the White House does not appear to have made combatting JASTA the priority it might have been. For example, House Minority Leader Nancy Pelosi noted that the White House did not work with, or even contact, her in an effort to marshal sufficient votes to sustain the veto. The strongest statement by the White House on JASTA came relatively late in the process in the president’s veto message to the Senate on September 23. A few hours after the veto override vote, 28 senators sent a letter to key sponsors of JASTA outlining their concerns and emphasizing the need for new compromise legislation. But their apprehensions about the potential consequences of the law were exactly the same as those outlined by Obama in his veto message, and articulated by many others long before September 28.
The political maneuvers and calculations behind JASTA were more complex than both sides were prepared to acknowledge publicly. The White House seems to have genuinely opposed the measure, but does not seem to have utilized its full arsenal to persuade Congress to sustain Obama’s veto. Many members of Congress – both Republicans and Democrats – apparently voted for the act primarily for political reasons, while fully aware of the downsides and privately already preparing for a post-election legislative “fix.”
Several important dynamics seem to have been at work. First, timing was clearly an issue. The looming elections left many lawmakers reluctant to vote against JASTA, even if they realized that, in the long run, they would have to take further action to ensure that many of its key provisions do not remain law for long. The White House, too, had at least one eye on the elections, and was not unsympathetic to the fate of Democratic candidates. And JASTA, not coincidentally, was brought to a head by its sponsors and the congressional leadership in the immediate context of the 15th anniversary of the 9/11 attacks, which ensured the strongest possible emotional atmosphere in favor of the bill.
Second, partisan rivalries were a factor, with Democrats and Republicans implicitly or explicitly blaming each other for legislation that many agree has significant potential downsides for the American national interest. Third, the familiar institutional tensions between the executive and legislative branches of government were reflected in the processes that led to the passage of JASTA. Fourth, the lame-duck Obama White House may have been reserving some of its limited remaining influence to defend other vulnerable foreign policy positions it regards as even more important than JASTA, such as the Trans-Pacific Partnership and the Paris Climate Change Agreement.
Corker and others have suggested that many members of Congress want to “see if some corrective measures can be put in another piece of legislation” to offset or attenuate the likely negative impact of JASTA as it now stands. He said House and Senate members want to “sit down” with the White House and “discuss routes that can take us to a better place,” and to ensure that Congress doesn’t “undermine other equities that the United States government and our people have.” House Speaker Paul Ryan has also expressed interest in further congressional action, especially to protect U.S. military officers from potential legal actions abroad resulting from JASTA.
JASTA allows U.S. citizens to sue foreign governments or officials for legal liability in the deaths of Americans killed in terrorist actions on U.S. soil. It is essentially a vehicle for allowing family members of the victims of the 9/11 attacks to sue Saudi Arabia and its officials for alleged involvement in the attacks. Although no evidence of this has been uncovered in any of the official investigations, many Americans continue to suspect that the Saudi government, or some of its senior officials, might have been in some way complicit in the attacks.
JASTA abrogates the bedrock international legal convention of sovereign immunity, whereby governments and their officials cannot be sued in foreign countries. 9/11-related lawsuits against Saudi Arabia have been consistently dismissed by U.S. courts over the past 15 years because they violate other laws that enshrine the principle of sovereign immunity in U.S. law. JASTA is intended to allow such lawsuits to move forward in the U.S. legal system. But once the United States scraps the principle of sovereign immunity, other countries can, and probably would, follow suit. The United States could face a wave of potential lawsuits around the world over its military activities. An Iraqi group has already begun to try to initiate legal action, based on JASTA, against the U.S. government for the invasion and occupation of Iraq that began in 2003.
No other country has a comparable global presence or role, and therefore no other government would be potentially as compromised by a post-sovereign immunity international legal order as the United States. By nullifying sovereign immunity, JASTA would effectively grant other countries a free hand in determining who may face civil or criminal liability for what they deem to be unlawful. Moreover, the U.S. government, and even its officials, could be held responsible for the actions of private U.S. citizens, organizations, and businesses. These are undoubtedly some of the “unintended ramifications” that McConnell was referring to, as he ruefully added that “nobody really had focused on the potential downside in terms of our international relationships.”
A number of European and other countries have expressed alarm about JASTA’s potential impact on international law and relations. The European Union sent a letter to the State Department warning that JASTA could have profoundly negative consequences for “bilateral relations between states as well as on the international order as a whole.” It added that “other States may seek to adopt similar legislation,” and that they might wish to take “reciprocal action,” implying that Americans might face a wide range of legal problems. The French, Russian, and Egyptian foreign ministries, among others, have expressed alarm about the potential impact on the international system. Turkish President Recep Tayyip Erdogan also criticized the law, and said he expected it to be reversed in the near future.
Some countries, beginning with Saudi Arabia, might start to divest themselves of U.S. assets to protect them from being seized to pay damages imposed in the event of a plaintiff’s victory in a JASTA-related case. Saudi Arabia, which is outraged, is reportedly considering a range of defensive or retaliatory actions, including divesting from potentially vulnerable U.S. assets. Laying out some of these Saudi options, David Andelman has said that, while he hopes wisdom will prevail, Congress has indeed given Riyadh “every reason” to seek “political revenge.”
Bahrain and the United Arab Emirates have joined Saudi Arabia in warning about the serious damage JASTA could inflict on the vital but already weakened U.S. partnership with the Gulf Arab states. In addition to Gulf Arab officials, regional opinion leaders and citizens have expressed indignation about the law. Some Arab commentators have suggested that JASTA could lead to a crisis in U.S.-Saudi relations, especially because it reinforces suspicions on both sides of the already-strained relationship. Additional damage to the frayed trust between the United States and its Gulf partners has been inflicted, with Saudis in particular again feeling betrayed by the United States.
But Saudi officials have recognized that the veto override need not be the end of the JASTA process and expressed hopes that “wisdom will prevail and that Congress will take the necessary steps to correct this legislation in order to avoid the serious unintended consequences that may ensue.” And some leading Saudi commentators have urged patience, and emphasized the value of the relationship with Washington and the dangers of an overreaction.
One potential solution being discussed in Congress is new legislation limiting JASTA cases to those directly involving the 9/11 attacks. But Senator Chuck Schumer, one of the key sponsors of JASTA, said he would not support such a compromise, which would make it difficult to secure. Another option is the establishment of an international tribunal of experts to determine potential legal liability, or otherwise adjudicate cases in a way that limits their diplomatic and political damage.
The “lame duck” session of Congress that will convene on November 15, after the elections, provides a useful opportunity for lawmakers to revisit JASTA. As The Wall Street Journal has noted, however, it won’t be easy, given that trial lawyers (a powerful and very well-organized political interest group) and some influential politicians, like Schumer, still seem determined to oppose any major revision of JASTA. Much of the U.S. public may continue to be on their side, as yet largely unaware of the potential consequences for U.S. foreign and military policy and the dangers to officials and military personnel.
Nonetheless, a consensus is emerging that something must be done to avert the worst consequences JASTA might inflict on U.S. defense and diplomacy. Plaintiffs’ attorneys know this is in the works, and are reportedly scrambling to file lawsuits against Saudi Arabia under JASTA provisions before additional legislation limits their options. Dramatic though it was, Congress’ first, and probably only, override of an Obama veto will almost certainly not be the last word in the JASTA saga.
The regulations introduced to travel and civil status laws will limit the state’s ability to intervene in the private sphere.
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