In this episode of our BryghtCast edition of the Managing Uncertainty Podcast for the week of September 30th, 2019, Bryghtpath Principal & CEO Bryan Strawser and Consultant Bray Wheeler take a look at three current risks and upcoming events:
- South China Morning Post: As it happened – Hong Kong protester shot in chest, six live rounds fired on National Day.
- New York Times: In Pictures – China’s National Day Parade Features Pomp and Artillery
- South China Morning Post: China’s National Day parade, as it happened
- FBI: 2018 Crime Statistics Released
- FBI: Uniform Crime Reporting (UCR) Program
Bryan Strawser: Hello, and welcome to the Managing Uncertainty Podcast. This is Bryan Strawser, principal and CEO at Bryghtpath.
Bray Wheeler: This is Bray Wheeler, consultant at Bryghtpath.
Bryan Strawser: This is our BryghtCast edition for the week of September 30th, 2019 where we take apart two or three events, stories, announcements, and talk about what it means for companies and nonprofit organizations in the private sector. Bray, what do we got today?
Bray Wheeler: We have today just a couple of items today, everybody’s favorite topic that we’ve been talking about all probably be for quite some time, Hong Kong. What is new? We’ve avoided talking about this just a little bit to avoid fatigue and the fact that the situation remains as is until over the last few days, particularly Monday here this week where Hong Kong police for the first time in all these months of protests actually fired a live round or more at protesters, but actually hit a protester with the live round.
Bray Wheeler: This is the first time that violent force has been used by Hong Kong police against the protesters. The protesters reignited some pretty heavy protest and different actions over the last few days, including setting fires, shutting down the subway, blocking traffic, kind of all of their MOs, but very much picked up the intensity of what they had been doing over the last couple of weeks anyway. The reports are that this police officer fell threatened, he was being attacked according to him and so ended up firing off shots.
Bray Wheeler: In addition to that, Hong Kong police have also fired live rounds into the air over the past 24 to 48 hours, so more live ammunition being used, not necessarily directed at people, but definitely being discharged. That’s all to say in the context. This is all happening in the context of China’s National Day or the 70th anniversary of communist party rule. There are a big celebration and parade here on Tuesday this week in which all the pomp and circumstance that China does with these different national days. This being the 70th anniversary, it was a little bit bigger, unveiled some new weapons, but kind of the unique piece to Hong Kong was a couple of things.
Bray Wheeler: One, Carrie Lam was an honored guest, which isn’t out of the norm, however, was highlighted as kind of a guest. Then the president of China Xi Jinping actually made comments in his speech almost from the get-go around “no force can shake the status of our great motherland, no force can obstruct the advance of the Chinese people and Chinese nation.” He also went on to say that they would maintain the lasting prosperity and stability of Hong Kong and Macau, so-
Bryan Strawser: Specifically called them out.
Bray Wheeler: Specifically called them out, so it was definitely left no mistake, as the New York Times reporter points out left, no mistake that Hong Kong is on the minds of Chinese leaders right now.
Bryan Strawser: There’s a couple of things to unpack here around all of this. I think the first is this appears to be an escalation on the part of the governments in Hong Kong. They arrested over a hundred protesters, I believe it was, during this weekend’s protest. They shot at the one individual and wounded him, I believe. I don’t know what… what was the size of the protest this weekend? I don’t know that I caught that in the news, but how did this compare to some of the protests we’d seen previously?
Bray Wheeler: I think in terms of the… so there were two simultaneous protests going on. I… trying to see if I can find the numbers right in front of me. The more violent actions I think are just within the norm of what they have been over the last couple of weeks, but their intensity of what they were doing increased, which was notable, but there was also a peaceful protest March in Hong Kong as well, kind of an anti-Chinese day parade, which was much better attended in terms of protest side, or protest size rather.
Bray Wheeler: But I think it’s all within the average norm of what we’ve seen. I don’t think it’s surged to the millions like it was at the height of it, but it was definitely enough to get attention of security forces as well as, kind of notable in terms of counter parade to China.
Bryan Strawser: The second part of this was just the other part here to unpack I think is the 70th-anniversary celebration that kicked off today, October 1st as we’re recording this. These are some pretty strong statements from the president, not just about Chinese dominance and expected Chinese growth as a great power in the years to come, but these specific commentaries around Macau and Hong Kong, Hong Kong in particular. I think it just goes back to the New York Times’ take on this, that we’re going to see the change in Hong Kong now. Maybe not at a more glacial pace as we were expecting for a long time, but a more aggressive and deliberate manner to bring Hong Kong more in line with Chinese norms. Is that your perception from this as well?
Bray Wheeler: Yeah, and I think it was also pointed out in some of the opinion and commentary pieces, which I also agree with, maybe not as on the same timeline as it was suggested, but kind of Hong Kong’s diminishing importance due to the trade war battles, skirmish, whatever you want to call it between the US and China. The fact that Hong Kong’s importance is diminishing as a part of that right now coupled with these democratic protests. It was suggested that we could see a definitive change in Hong Kong eventually, and sooner rather than later just based on the fact that China feels like they can get away with a little bit more now that it’s not as important, they will face less international pressure, there’s less domestic pressure, there’s more violence going on, kind of asserting their needs to get the situation under control.
Bray Wheeler: It also flies, this was suggested in some of the reporting, around China National Day that the president of China has been working to kind of homogenize China rather than expanding on the diversity that China has touted a little bit for several decades as a part of what they’re trying to accomplish, that they’re actually going in the opposite direction, which is probably going to cause him more problems in the future, but there’s that part of it too where they’re trying to assert the one-China homogenous idea what’s going on.
Bray Wheeler: There’s a lot of contexts. There’s a lot of factors at play with Hong Kong right now that probably doesn’t bode well for what we were used to as Hong Kong a year ago, two years ago, six months ago to what we’re going to see in six months, a year from now, two years from now. I think it’s potentially at a tipping point, and it certainly has continued to escalate.
Bray Wheeler: For companies, we’ve been talking about this in different ways of do you have a BC plan, do you have an EVAC plan, are you thinking about how your operations work in Hong Kong, those kinds of things. I think if you haven’t already, not to sound too alarmist here, but if you haven’t already, now really is the time because as we’ve seen since the beginning of this, 115 days I think it is of protest activity, there’s been no de-escalation of what has gone on. There have been no real signs of getting back to what was considered normal. It’s only increasing now, and the fact that there are some violent tactics being used both by protestors and by security forces, it’s probably going to continue. There’s no way, kind of-
Bryan Strawser: Right.
Bray Wheeler: You can’t put the lid back on that.
Bryan Strawser: Can’t put the toothpaste back in the tube.
Bray Wheeler: Yes.
Bryan Strawser: As we were talking to this morning in my office prior to recording the podcast, this is also probably the beginning of the time when companies need to think about is Hong Kong in the longterm where we want to operate? Is… For a lot of companies, Hong Kong is their base of operations for Asia. That’s where their headquarters or regional headquarters is. That’s where a lot of American expats, for example, base themselves. Same for the Commonwealth countries, Hong Kong, of course, being part of the United Kingdom for so long.
Bryan Strawser: But a lot of these companies, many of these companies are starting to consider is Hong Kong the place we want to be 20 years from now if we’re going to see more movement towards Hong Kong looking more like the rest of China? Do we stay there, or do we decamp to another westernized country that plays by a western ruleset here, and for a lot of countries, that Singapore where, again, we have a former British, mostly British base of operations that’s an independent city-country, city-state, now and operates in that way and typically follows western norms, leaving out the caning and things like that that goes on.
Bryan Strawser: But this isn’t a today thing, but as you pointed out if you haven’t already looked at your BC plans now, it’s really the last chance we’re going to get to take a solid look at this. It’s also I think the beginning of the time in which you need to evaluate is Hong Kong where you want to be in the longterm or is there another location that is going to be better suited for you 5, 7, 10 years down the road?
Bray Wheeler: Yeah, and we don’t get a cut from Singapore for saying it. I think all preference would be to be able to have those of basis of, or entry points into Asia both through Hong Kong, through Singapore, through other locations in that region, but the viability of Hong Kong right now going forward as of now, if the current trajectory stays in place-
Bryan Strawser: Yeah, the longterm thought process, where does it take us?
Bray Wheeler: … you have to really look, you have to really look at that.
Bryan Strawser: Back in… when was the handover, in 1997?
Bray Wheeler: Yes.
Bryan Strawser: Right? I was 23 in 1997. I remember watching this, and I had no clue what this would mean in the longterm, but here we are almost 22 years, we’re 22 years past the handover, or close to. I think that it’s the end of the year is the anniversary, and you’re starting to see those first big steps towards significant change there. Definitely, one that you need to keep an eye on, and our recommendations are to look at your BC planning and start to think longterm. Is this where you want to be?
Bray Wheeler: EVAC plans as well, travel itineraries-
Bryan Strawser: If you need to get out of there quickly.
Bray Wheeler: … just kind of taking a holistic look and assuming that, “Hey, this gets shut down, this goes martial law, this goes in a direction where we’re kind of isolated,” what is it that you’re going to need to do in order to keep your people safe, continue your operations, things like that, so holistic look right now is, as you mentioned, kind of your last opportunity while it’s still relatively… there’s some stability left. Now is the time.
Bryan Strawser: Our last story for this episode is from the New York Times, but the release is really the FBI releasing the 2018 Uniform Crime Reporter, UCR, which was released yesterday, Monday, September 30th. The big headline here is that violent crime in the United States including homicides declined in 2018 for the second straight year according to FBI data that was released on Monday. Overall, the nation’s crime rate dropped by 6.5%, which was led by us 6.9% decline in the property crime rate that 16 years in a row in which property crime dropped. The homicide rate dropped by 6%, primarily driven by significant declines and homicides in both Baltimore and Chicago. On the other side of the equation, rape, sexual assault, as the FBI calls it, and aggravated sexual assault climbed in 2018.
Bray Wheeler: Now, they’re suggesting it’s a… they’re wondering if that’s a little bit as a result of the Me Too Movement where there’s been greater reporting, greater documentation of those crimes, excuse me, that that’s a part of the reason that that kicks in. There’s also been a lot of work around that particular crime type in terms of the crime reports over the last 10 to 15 years, better documentation of that because it’s a little bit inconsistent in terms of how states and counties report those in, so I think there’s been an improvement on defining and accounting for those as well.
Bryan Strawser: The New York Times says that the number of rapes reported in 2018 increased by 2.7%, and it was the only category of violent crime that rose last year, according to the Uniform Crime Report. Criminologists said that it was not clear whether more sexual assaults were occurring or whether more people were reporting assaults amid the Me Too Movement. The FBI also complicates the results because they revised the way they classified rape to include both males as victims and expanding the definition of rape to include types of attacks that were not previously counted.
Bryan Strawser: By the way, those guidelines were changed in 2013, and since those guidelines have changed, the number of reported rapes to law enforcement has grown more than 18%. We should point out the Uniform Crime Report, although this is usually the crime stats that folks use, it only includes crimes that have been reported to law enforcement.
Bray Wheeler: Correct.
Bryan Strawser: There’s another survey that’s conducted by the Department of Justice called the National Crime Victimization Survey, which is also done every year, and that is a sampling of individuals to determine if they have been victims of crime, and it reports that data. Those numbers are always higher because some folks are involved, or I’m sorry, some folks who are victims of crime, and they never report it to law enforcement, but you can look at the increases between the two and draw some correlation.
Bryan Strawser: For companies, some ways that you can use this data, it can be a key source of objectable, objectable, objective data that you can use in policy discussions. You can use it as a source of data to assess your security posture and actions that you may want to take or not take. We consider this of the key annual reports to read and understand for the security profession, particularly looking at actions around your major site locations, cities, states, et cetera, counties.
Bray Wheeler: Yeah. It’s a good reference document. It’s kind of a good, I want to say the source of truth because to your point, it’s only reported, and it’s only those cities and counties and law enforcement entities that report in. Not all do or do in the same way, but it really is a good bellwether, especially as you’re looking across the nation. If you operate in different cities and different locations, understanding what the trends are there to make sure that your posture’s, depending on your industry, are appropriate to what’s happening in those areas and where you should add resources or potentially subtract. Now, of course, this data is from 2018, so it’s almost a year old, which is always the case because they take a lot of time to scrub through it, but it definitely the, in terms of the trends and things that they see, you can take a look at those and use those as you’re planning out your security posture.
Bryan Strawser: I was always like to see this data. I mean, I’m a data guy by nature. I like things to be… I like to have things proven to me using data. But I think of the things that always helps me with as a security professional is, although I think the world is more uncertain and riskier today than it has ever been in my lifetime, and it never, to me, the world never really gets safer, I do think that most people in the United States, in particular, think that there’s this enormous amount of violent crime and homicide.
Bryan Strawser: In fact, we’re at a near 50-year low of violent crime and homicide rate in this country. It’s down by more than half from the 1990s when I was coming out of high school on my own into a college, so I like to see the data, but most folks are totally shocked by that when they see a graph of this and how far it’s dropped, and particularly when we look at news coming out of Baltimore in Chicago and Washington, D.C., which I will note that D.C. is way up 2018 into 2019.
Bray Wheeler: D.C. and Philadelphia-
Bryan Strawser: Philadelphia.
Bray Wheeler: … I think were the two high risers.
Bryan Strawser: Washington, D.C. was up 36% for homicide rates, and Philadelphia was up 10%. I should point out here that the important data because we’re looking at crime data, although they do report whole numbers, the important data is the crime rates because you need to control crime, you need to control crime data by population. A rise in population doesn’t necessarily mean an increase in crime.
Bray Wheeler: Well, and I think to your point, I think it’s an important point to reiterate that you made in terms of it’s a good reality check to what we’re seeing, how we’re feeling, how we’re perceiving things, to be able to go back and just gut-check ourselves against some of the data to go, “Okay, let’s put this in the appropriate context.” It’s a focus in on the areas that we are seeing increases in, but also understanding in totality what’s going on to make sure that we’re not making big assumptions, we’re able to explain and weigh decisions in terms of security strategy or other operational decisions to leadership who may read this in the paper going, “What are you talking about? Crime’s down. Why are we investing in that?” Well, here’s why, and understand that this is the context, so yes, you are correct. It’s down nationwide; however, in Washington, D.C.-
Bryan Strawser: It’s up.
Bray Wheeler: … it’s up, and we need to account for that, and we’re seeing this impact here.
Bryan Strawser: We’re experiencing this locally right now here in the Twin Cities. Minneapolis has had an increase in violent crime, particularly homicide involving firearms this year, but St. Paul is, on the other side of the Mississippi River here, is having a huge spike. They’ve got some gang conflict that’s driving the bulk of this, and it’s not been a good summer for the city of St. Paul in this area. But this kind of data helps kind of see that in context and put it in reality over time. There was a spike in ’16, ’17, and ’18. We saw some uptick in violent crime, and now we’re seeing it come back down.
Bray Wheeler: Yeah, I think it was 2015, 2016. There was definitely a spike, and so that’s part of it too is to understand that we’ll go through these ebbs and flows of a lot of increase, and then some decrease to figure out where at in the norm. Although it’s a 6% decrease, it’s obviously an improvement, but compared, it’s still dropping those increases from 2015, 2016 potentially. It’s all good context. It’s good information. It’s kind of vetted. Like I said, they take months and months to scrub this and organize it and make sure that they feel confident with the data that they have before releasing it and making it official because a lot of law enforcement and other agencies use this to account for budgetary things and their strategies as well, so they want to make sure it’s accurate.
Bryan Strawser: You can find the… we’ll put the link to the FBI data in the show notes, but you can also find it and other contexts that fbi.gov. They’ve got some court reporting tools you can use to slice and dice and extract this data of the way that you want. That’s it for this edition of the Managing Uncertainty Podcast. We’ll be back with a new episode next week.