Endogenous, Exogenous and Existential Risk-New Global Solutions

• Author: Professor G. Walker
• Pages: 1-97

Endogenous, Exogenous And Existential Risk –

New Global Solutions

P

ROF

G W

ALKER

*

I. Endogenous, Exogenous And Existential Risk

Financial markets are complex adaptive systems with society being made

up of multiple layers of interconnected and overlapping systems.

1

Modern

technology has supplemented this with the creation of digital systems within

this larger aggregation with special features and operations.

2

All systems are

subject to internal, or endogenous, and external, or exogenous, threats and

exposures.

3

Specific issues arise regarding Financial Technology (FinTech)

and associated Regulatory Technology (RegTech) as well as other forms of

new technology (NewTech or FutureTech).

4

Recent technological

innovation, such as with the potential emergence of new, large circulation

global digital coins (supercoins) or internet-based software applications

(superapps), have further challenged the boundaries of traditional legacy

regulation.

5

While many regulatory systems were strengthened following

the global financial crisis, societies are still susceptible to larger exogenous

threats, including continuing viral pandemics, natural disasters (earthquakes

and tsunami), climatic impacts (floods and droughts), infrastructure

(including cyber threats), technological risk, and warfare.

6

The Coronavirus

2020–2021 crisis stretched national and international control regimes to the

limit.

7

New total global short and long-term solutions must be constructed

with a new architecture erected to protect the resilience of all markets and

systems, economies and societies more generally from internal, and

* Professor G A Walker, Professor in International Financial Law and Financial Technology

(FinTech) Law, Centre for Commercial Law Studies, Queen Mary University, London.

1. Paul E. Plsek & Trisha Greenhalgh, Complexity Science: The Challenge of Complexity in

Health Care, 323 BMJ: B

RIT

. M

ED

. J. 625, 625 (2001).

2. John Palfrey & Urs Gasser, The Perils of Highly Interconnected Systems, MIT T

ECH

. R

EV

.

(July 30, 2012), https://www.technologyreview.com/2012/07/30/18992/the-perils-of-highly-

interconnected-systems/ [https://perma.cc/R7EP-GQ5L].

3. G.A. Walker, Regulatory Technology (Regtech) – Construction of a New Regulatory Policy and

Model, 54 T

HE

I

NT

’

L

L

AW

. 1, 10 (2021).

4. Id. at 9–10.

5. G.A. Walker, Bigtech, Stabletech, and Libra Coin – New Dawn, New Challenges, New Solutions,

53 T

HE

I

NT

’

L

L

AW

303, 304 (2020).

6. G

EORGE

W

ALKER

, F

INANCIAL

M

ARKETS AND

E

XCHANGES

47 (Michael Blair QC et al.

eds., 3d ed. 2021).

7. Id.

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endogenous, as well as external, and exogenous, shocks or threats on a

continuing basis.

The opportunity can also be taken to develop several recommendations

for the construction of a larger new ‘sustainable, managed, adaptive,

recurrent and targeted’ (smart) framework using ‘socially, managed,

adaptive, regulatory and technology’ (smart) tools. This would build a series

of integrated ‘Social, Market, Atmospheric (Climatic), Regulatory,

Technology and Security’ (SMART or SMARTS) and Society, Trade,

Atmospheric, Regulatory, Technology and Safety (START or STARTS)

agenda. This would be given effect to through a ‘Global Investment,

Finance and Trade’ (GIFT) Treaty which would operate as a type of post-

global financial crisis and post-Coronavirus crisis ‘Bretton Woods III’ Treaty

reference system. This could be supported by a ‘Global Reciprocal

Economic Area Treaty’ (GREAT) which could form the basis for a new

‘Global SMART Market’ system. This could include a more specific

‘Climate, Health, Energy, Security and Technology’ (CHEST) package of

measures.

Countries can be assisted through a separate ‘Financial Investment,

Regulatory, Social and Technology’ (FIRST) agenda with emerging markets

benefiting from a dedicated ‘Sustainable Assistance Finance and

Engagement’ (SAFE) program with climate protection secured through a

parallel ‘Sustainable Assistance and Value Enterprise’ (SAVE) agenda. This

can be supported by a ‘Global Integrated Law and Technology’ (GILT) or

separate ‘Market, Economics, Technology and Legal’ (METAL) framework.

All of this would operate through a series of new national and international

‘Protocols’ based on common objectives and principles under a ‘Protocol

Adaptive (or Adapted) Safety and Security’ (PASS) regime within a new field

of Public International Law. The objective would be to create an integrated

form of protocol based ‘Contingent Response for International Safety and

Integrated Stability’ (CRISIS) or ‘Contingent Response for International

Safety, Efficiency and Stability’ (CRISES) program.

This Bretton Woods III system could form the basis for a ‘Fifth Industrial

Revolution’ (FIR) or new ‘Sustainable Technological and Industrial

Revolution’ (STIR) and ‘Fifth Adaptive, Sustainable and Technological

Economic Revolution’ (FASTER). The purpose would be to create a set of

essential global minimum measures or key ‘Global Objectives and Absolute

Living Standards’ (GOALS) based on a ‘Core Objectives, Directions, Ethics’

(CODE) statement or primary set of ‘Conduct Objectives Regulations and

Ethics’ (CORE). This may also be referred to as creating core ‘Conduct

Objectives, Principles and Ethics’ (COPE). This would ensure

‘Fundamental Interests, Rights and Entitlements’ (FIRE), ‘Fundamental

Objectives, Rights, Claims, and Entitlements’ (FORCE), ‘Fundamental

Objectives, Rights and Global Entitlements’ (FORGE) and ‘Global Rights,

Interests and Principles’ (GRIP). This can also be considered in terms of

‘General Laws and Obligations for Behavior And (advanced) Living

Standards’ (GLOBALS). This would specifically protect the ‘Controlled

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2022] ENDOGENOUS, EXOGENOUS & EXISTENTIAL RISK 3

Linkage and Integrated Management of Atmospheric Targets and the

Environment’ (CLIMATE) and avoid ‘Wasteful Injury, Loss and Damage’

(WILD). This would be based on ‘Carbon Low, Efficient and

Atmospherically Neutral’ (CLEAN) systems and apply ‘Biologically sensitive

Universal Integrated Law and Development’ (BUILD) techniques to secure

‘Development Reform and Efficient Atmospheric Management’ (DREAM).

The Protocol series would be based on core ‘Enhanced Targeted Higher

Integrated Conduct Standards’ (ETHICS) as well as ‘Managed Ordinary (or

Official) Responsibility, Application and Liability Standards’ (MORALS)

and ‘Special Official Collective (or Community) Individual Advanced Living

Standards’ (SOCIALS). This could be considered to secure proper

‘Conduct of Official New Technology enhanced Regulation, Oversight and

Law’ (CONTROL). This may include specific ‘Technology and Ethical

Conduct Heightened Standards’ (TECHS) or ‘Ethical Conduct Heightened

Ordinary (or Official) Standards’ (ECHOS). All of this would in so far as

possible be based on the ‘Rule of Law and Ethics or Enforcement’ (ROLE)

or ‘Recognized Universal Laws and Ethics’ (RULES). This would support

‘Rights, Ethics and Standards Protection, Enforcement and Control Tools,

Techniques or Targets’ (RESPECT).

The system would promote ‘New Earth Worth’ (NEW) and recognize

‘Fundamental Rights, Ethics and Entitlements’ (‘FREE’). It would be based

on ‘Fairness, Understanding, Equality and Legality’ (FUEL) and ensure

‘Responsible, Inclusive, Sustainable and Equal’ (RISE) treatment. It would

secure ‘Happiness, Opportunity, Peace and Equality’ (HOPE) and promote

a more essential ‘Humane Understanding of Mankind and Nature’

(HUMAN). The overall objective would be to create a comprehensive and

integrated global crisis management framework for new technological and

exogenous shocks as well resolve the principal continuing global challenges

and issues that apply at this time. This would incorporate a full set of

essential and fundamental rights and protections in a clear, coherent, and

accessible manner for the benefit of everyone, including individuals,

societies, and nation states. This would be endogenous, exogenous, and

essential at the same time as being consistent, complete and coherent to

build a new world and new future.

II. New Global Challenges And New Global Solutions

We have created a new world. This is specifically based on technology and

social media. The people of the world are now more intimately connected

than ever before.

8

This brings massive benefits in terms of ease of social

contact, communication, and exchange; although, it also creates inordinate

8. Patricia Reaney, Most of World Interconnected Through Email, Social Media, R

EUTERS

(March

27, 2012, 5:25 AM), https://www.reuters.com/article/net-us-socialmedia-online-poll/most-of-

world-interconnected-through-email-social-media-idUSBRE82Q0C420120327 [https://

perma.cc/4PNN-YLKL].

THE INTERNATIONAL LAWYER

A TRIANNUAL PUBLICATION OF THE ABA/SECTION OF INTERNATIONAL LAW

PUBLISHED IN COOPERATION WITH

SMU DEDMAN SCHOOL OF LAW