My name is Geraldine de Bastien and I am very much looking forward to moderating this panel session now on the topic of global justice and digitalization. The panel is going to focus on perspectives from the global South on the topic of global justice and in particular we want to zoom in to discuss topics around digital colonialism, the existing power structures in today's digital worlds and what opportunities we might have to change the existing status quo toward a future we think is more desirable. Toward the end of the panel we also want to try to tie in some of the climate justice topics with the topic of digital justice and we'll invite you all to join the conversation by making comments and asking questions. I have three most excellent panelists with me today and I would like to begin the session by introducing them to you. To my right is Renata Avia who is the CEO of the Open Knowledge Foundation. She is also an international lawyer, author and advocate who brings nearly 20 years of experience in the topic of access to knowledge, freedom of expression, policymaking and global digital rights. She is an affiliate with the Stanford Institute of Human Centered Artificial Intelligence and serves on a number of boards including the Governing Board of Open Future and the Advisory Board of Creative Commons. She also founded the Alliance for Inclusive Algorithms, the Progressive International and Polylateral Association and as you can see very busy depending on digital rights online and offline. Thanks for being here with us today Renata. I have, you can applaud to welcome her if you like. To my left I have Gable Kazan who defines himself as a digital dreamer, an internet leader and activist. Gable Real has a background and degree in computer science and several years experience working in the NGO and civil society sector where he is championing the topics of digital literacy and emerging technology adoption through projects such as the podcast. He's doing a podcast called Dream Internet Voices and this podcast also led Gable to founding the emerging youth initiative which is a non-profit youth organization boosting egalitarian, safe and progressive technology uses and adaption and ecosystems. Welcome Gable, it's great to have you here as well. And our third panelist will be joining us online. Nadini Chambhi is the deputy director and fellow at IT for Change, a non-profit organization based in India that works on gender equality, social justice and development justice in the digital economy and society. Nadini's work is focusing on research and policy advocacy in these domains and particularly addressing corporate power in the digital economy, alternatively coming up with digital, like I said, imaginaries, so other futures that we can think of, particularly her work is grounded in Southern feminist epistemologies and the political economy of digital rights. Welcome, Nadini. Nadini, I can't see you here on stage, unfortunately. I want to let you know that your screen is behind me. So usually I would have said, like, feel free to give us a wave if you want to butt in any time. But now I'm going to say just open your mic and start speaking to butt in any time in case I'm not calling it you and you want to add something to the conversation. Okay. Yeah, we can hear you super well and see you well too. Perfect. So I would like to begin so a little bit for the format. We're going to do this in two rounds. We're going to begin by discussing the status quo and the power asymmetries that we're facing today. And then in the second half of the discussion we want to look forward and see how to change the status quo and what opportunities we have that we are already working on today to perhaps also join forces in a broader sense to do that. And like I said, open up to your questions and comments as well. But I'd like to begin by giving everybody a bit of time to talk a bit more about how their work relates to this topic. So maybe, Renata, I can begin with you as you do many exciting and wonderful things in the area of digital rights. Just to speak a little bit how you approach the topic of global digital justice and how you're trying to work toward that with the different things that you do. Well, I will focus on the work of Open Knowledge Foundation because it is, I think that is the, on my role, multiple roles, I think that is the most relevant for the conversation that we are having today. And it's very interesting because Open Knowledge Foundation is not new. It is almost 20 years old. And looking back in time, it was born at a time, at a moment full of hope on digitization. And the moment that everybody, those who founded it, like Rufus Pollock and others, were convinced that, you know, like the way digitization and global justice will go hand in hand. And it was a full of optimism. It was a wave of, okay, we, we in that time was a group of academics and activists, like mostly from the global North, were very, very, very excited because they were seeing like us costs were getting cheaper, knowledge was getting more distributed, how tremendous possibilities of accelerate change and increase equal access to knowledge and increased possibilities to the many were very, very real and not so costly and not so complex if we would establish different nodes of people with the same purpose in different parts of the world. And so that's the way how Open Knowledge Foundation started. And we basically coined the term Open Data that now is everywhere. And that culture of openness and making, you know, available and accessible key infrastructure, key digital infrastructures for everyone. And principles like decentralization, distributed power, localization were very like embedded in our culture. But that was almost 20 years ago, you know, licensing was very important because the bad guys were very different back then. The bad guys were like the copyright industry and big fun. Some are still bad guys, you know, but now we have a more crowded room of bad guys. Copyright industry, for example, a big, big, big blocker on this opening knowledge and making accessible to everybody. And of course, another of the bad guys, which is still one whose principles and logic and money-making model has prevailed is a big pharma industry, still there. But, you know, the first patch, the immediate patch was to open up the possibility to share this knowledge. However, and it was not only the Open Knowledge Foundation, other foundations and activist groups, we made a strategic mistake that we are now realizing. And the strategic mistake was ignoring that the oldest openness was happening in specific structures of power and that some were getting more benefits than others from this opening of everything. We didn't attach rules as sustainability and fairness to those dynamics of openness. And so it resulted in different cycles of exploitation and extractivism and different forms of colonization paradoxically. Just to fast forward to what we are doing now. We realize that Open Knowledge is not only about licensing and putting like data sets available online. It is more complex than that. And so one of the parts of our new strategy and part of the mission that we want to do is to basically smash secrecy. Secrecy is which takes different shapes and forms. It is still very present. And it is still blocking possibilities to many, possibilities of accountability, possibilities of real change, possibilities of scaling, the change that we want to see. The second thing that we are like working on is removing unnecessary delays and barriers of having this access to real access to knowledge. If you think, quick example, if you think of patents and how even if we have today a very good solution to solve a public health issue or solve, you know, deploy a super good technology to accelerate the changes that we need to reduce emissions. If it is locked by a patent, it only belongs to the few. And it is against logic of survival even, you know, to lock for 20 years, for 25 years, the innovation that we need right now. So we are also looking into that and looking into like unlocking the innovation that we need to solve the problems of the right now without giving artificial monopolies to very few. And the second is like is building real literacy in the groups like we do not no longer see ourselves as a frontline organization but as an enabler organization. We know to do two things very well. We know how to create data infrastructures and we are very good at with more than eight years of experience on connecting people to take the full advantage of that open data and reproducible research with tools that are accessible to them. And that can empower environmental groups, that can empower social justice groups, that can connect and link the two to see for example how pollution of the air is affecting communities in a specifically geolocated area. And since our tools are principle interoperable and accessible to all, that can really make help, need this global movement. So that's what we are doing in a team, a small team of 15 people in four continents and an expanded network of different chapters and affiliates in around 45 countries. So that's the not so summary of what we are doing at Open Knowledge Foundation. Thank you so much, Renata. You touched upon very important points that I definitely want to circle back to in the course of the conversation especially as we get to tie in climate justice topics with digital rights topics, this point of locking away innovations I think is of real key importance. Before we move on I just want to make a very quick technical question. Is there any way to reduce the hull on stage so we don't hear everything double and out of sync? No. Okay. All right. Moving on. Nandini, IT for Change has been also an extremely important actor in terms of digital rights. And I would like you to explain a little bit more about how you do and what your work for global digital justice looks like. Yeah. Thank you for that. I took a change personally in the early 2000s and the world was full of the autism of the brain. Society and there was a group that met with a level of point for the mission of the organization was always centered in defining what should be the future of the people centered in for me. And 20 years later in our research and policy advocacy, one of us can be held this at the center and it is this. Digital justice is not to be included with inclusion into connectivity. On the contrary, digital justice is actually about ensuring that connectivity that's from data and AI structures are able to pave the way for the enhancement of human development and go through the approach and enable the people of the global And this is what we do in all the work that we do. And this is the vision of digital justice as development justice that we do in our organization. I am guessing that the sound was also semi okay in the audience looking at your faces because it's hard to tell because the sound is kind of weird on stage anyway. So Nandini, I think we got most of what you were saying but I think it would be great if you can speak super slowly the next time to make sure even more comes across. Gabriel, you are working with young people as I understand and trying to get an understanding for the means and the value of technology. Can you explain how you work, what your youth organization does and how the topic of global digital justice relates to your work? Thank you. Am I audible? Great. First I have to say and acknowledge that I am my ancestors while the streams just to be here sitting with you all discussing global justice as a black man from the global south but being given and awarded the privilege of being in such a community that stands for equity, openness and the principles of autonomy is quite important and quite a privilege I think that's something you should applaud yourself for so thank you very much. As a young person in this age I was born in the internet age as it matures I mature with it. In my organization it's important to know how we tackle literacy. We tackle literacy not on the point of the content or the context but the nomenclature and the social element of it because my agency is to understand that true liberty, true equity is gained when someone is actually free and that's gained through open knowledge that is shared through the digital world it's shared through open access being embedded in a network that does not see your color in a network does not see your original creed but all together trying to build something stronger and together as a global village and that's important so for us in our organization working with young people it's more about changing the mindset and changing the narrative to a point of ownership where together we can build and we can get there faster in matters of climate change together we can build and we can get there faster and in matters of a progressive world together we can build and we can get there faster so I work tirelessly to form on the aspects of inclusivity and diversity because once your voice is heard when you see yourself through someone it's easy to translate that into policy it's easy to translate that into the daily operations of how the digital world works and these are the important pillars we need to work I also work in the internet governance space where there is something called the multistakeholder model the multistakeholder model is something that actually represents equity where each and everybody the end user has a voice in implementing change and this is something which is driven in a consensus model where we come into an agreement in shaping the evolution of the digital world I also work at the African parliamentary network of internet governance and my job there is to actually contextualize the movement of the world you know most of the politicians do have a simple understanding at the content level but they do not understand the infrastructure behind the technical community the role of academia and especially the lower of civil society so working there we empower these politicians to understand what it means and the power they have to shape the evolution of the digital world and digitization because in terms of global justice legislation is quite important and when they do have the literacy schemes when we do have that intersessional and intergenerational dialogue that is when we can really shape change and that is how we can have spaces like this so basically that is what I do I am somebody from the internet working for the internet and by the internet thank you so let's start untangling the world we're facing today and some of the problems around that I'd like to begin by looking at this both from an infrastructure level but also of course from a data level and access to knowledge level which you've already touched upon in your first intervention so who owns the internet today and what are the power asymmetries that you're experiencing that make that difficult if I'm going to give this question around let's maybe try to attempt to answer it from a global level but if you want to zoom in on your respective national context maybe especially Nandini and Gabriel that would be great too do you want to start by giving a little bit of a global overview of the current power asymmetries that define our digital spaces maybe this is a bit of an introductory statement also for those who are a bit newer on joining the conversation on digital colonialism so if you want to add a bit of an explanation of what the term means please go ahead okay okay I'm always starting we need to distribute a little bit more like I know but I who owns the internet today not us certainly not the citizens most of the governance and the ownership of the infrastructure of the internet is in private hands and in private decisions concentrated in one or two countries and that's a big big big problem of if we think of only the pipes and to give you an example the way that Central America where I come from is connected is connected to one cable to go through Arcos who goes through Miami basically and if that if that cable goes away the whole connectivity of the region goes away and most of Latin America for example if we look at the cables you know like that basic level of infrastructure is connected through the US and now there's I mean the Europeans are very excited that there's a you know the first cable connecting for educational purposes is called Bella a cable connecting Europe through Lisbon and Brazil but it's a very fragile like you know infrastructure that is only intended to like basically targeting the most developed research centers in Brazil in Chile and in the southern cone basically and and and that's it you know like and that if you think of the dependence you know like the dependence and it is neo colonization of my continent that at the layer at the layer of the infrastructure depends absolutely on one cable that belongs to corporations in the US at the hardware level basically is belongs half half to China in the US all the equipment all the things that we used to connect it absolutely imported right not produced locally at the layer of the apps and services that we use five companies all US companies I mean I'm not talking about social media I'm talking about you know like the main companies that provide the main services that keep our digital infrastructure afloat from hospital services to education services to government in general belong to five companies in the US and so we can I mean we can see how Latin America for example concretely depends absolutely in a set of corporations that are in one state with our influence is very like you know little I mean even if we legislate locally we have no options we have no opt out and and and there's basically we are in a complex um um situation of no alternative I was just as you were speaking thinking I feel like maybe five or eight years ago this conversation about the concept of vertical integration so not just that it's five companies owning everything but owning everything from the glass fiber cables to the app level um so that's that that tiered um dominance is as the concept described as vertical integration and I feel like there was a much larger conversation around the dangers of that than today like it's basically a term that sort of seems to have disappeared from digital rights conversations is that because this is sort of such an stark situation that there seems to be little alternatives as you just said or why do you think that is I mean I will be very cynical I think that it was a lot that the political landscape changed a lot and the discourse changed a lot and now we are like in this polarized situation of the good good guys and the bad guys in the conversations in digital and when you we talk about the global south we are back to the damn conversation of connectivity and connecting the next billion and we get stuck there and connecting the next billion to what when we are at the at this multi-stakeholder conversations we have the saviors you know like the same as colonialism the saviors of Google saying saying oh we will provide you internet we are going to provide the infrastructure that your government is failing to to provide same with meta same with um now Elon Musk saying oh I'm the savior that is going to connect that is connected is the disputed territory because it turns out that all these people who are not connected is a very interesting market and is a very interesting free a source of free labor to train the system that are going to control everything in the future yeah so then they can be like discarded our equation wrote down Starlink earlier when you were talking about the fragility of infrastructure and our dependencies because of course that's one of the sort of starkest examples of that at the moment Nandini and by the way Nandini and Gabriel and Renata if I'm not asking you directly but you want to feel you want to jump in and comment please do that anytime um Nandini I'd like to ask you next um if you can add to what Renata said in terms of describing where you see the starkest power asymmetries and also perhaps giving a little bit of insight to the Indian context because I feel we sometimes we meaning some people sometimes look at India who romanticize a little bit the idea that the government is creating its own structures in terms of creating in terms of balancing out this big tech power and trying to create more state run infrastructures but of course there's a lot of criticism around that from civil society perspective so perhaps you can share some information about that with us too uh yes uh if you look at uh who is actually controlling the internet hoodie uh I agree with my response that uh it's actually big tech uh I want to first talk about a point that Renata was speaking about uh which is that if you look at the co-frustructure of the internet the underwater cables and the content delivery networks it's the big tech of the US that plays a very critical state in it today and I also want to share a short anecdote about four years ago which I find quite illustrative that initially the internet as the worldwide web as the internet of hyperlink it was seen as something that would facilitate sharing these connections but almost a decade later after the rise of the internet platforms we have seen an internet which is just like full of walled gardens and what does this mean for all the possibilities of transformation and emancipation that we needed out in the early years uh I also want to bring another point before I just say your question about India and it's this typically we think about how there is a US model of internet that is controlled through a multi-stakeholder governance model and then we look at the Chinese model and say that if we think this and we try to look for an alternative we will just end up with a state controlled internet right but uh actually this is correct misleading because when you look at digital sovereignty and the fact that state we have a role to play the creation of digital public infrastructure I think that there is a third way possible and that is where India may offer some parts so India has not got the solution perfectly because we see that in agriculture or in health or in particular sectoral domains uh India is trying to create the basic uh building blocks of platform data infrastructure that can facilitate local innovation through its national open digital system totally it's also trying to create standards that are public like in the cases of the unified payments interface which facilitates digital banking and digital transfer of payments to happen but where it's going wrong one more thing or where it can move more is to actually build community partnership and like to the public community partnerships around which the international on these ecosystems can be supported because otherwise there is pain of replicating and mimicking the very data extractivism that we criticize and try to build uh alternators uh I can bring more thoughts later but I just want to come if you could uh me all right okay um I think I got most of it did you guys hear more better this time it was a bit better right okay great thank you Nandini this was a great pace of speaking at for sure Gabriel of course I want to ask you the same question too and maybe having heard what your fellow panelists said how do you feel this relates to the situation in East Africa and perhaps also particularly in Tanzania yeah um from the days of ARPANET like 30 years ago where the internet was born it was highly fragmented in a way it's an americanized model of democracy and that is true we still have almost 12 or 13 root servers which are still highly americanized in the terms of how they should represent the majority of the world and it's not bad we have had some points of breaking the digital divide but the problem is now it is intertwined with their meaning of capitalism and where centralization and centralization of the connection itself the content is made for the sake of making profit while the internet should be public property for each and everyone to embed and feel represented in that manner uh still for for East Africa and for sub-Saharan Africa we still have a big internet connectivity issues the internet is still highly embedded in the philosophy whether the west or the eastern side and we are forced to choose if we choose the new democracy american model that's fine but where we go against the china model and if we choose the china model we go against so Africa is actually in a big dilemma where we are still in that consumer driven mindset where we are taking the network or the connection as a finished product but we do not have the right qualification literacy for us to actually create our own network so that the internet can be interoperable and represent each and everybody that is an important thing in terms of the government still legislation is fragmented when there's a political layer on the OC model and that has been the difficult thing as we see 30 years of the internet come now but some solutions we see with web 3.0 where we see decentralization but still it reinforces to the digital divide because we do not have proper ownership and understanding of what it means to be meaningfully connected from the technical aspect from the academia aspect and from a user aspect who is the core and most important part so most of the infrastructure is still controlled on the capitalistic driven thematic regions most of the content most of the decisions are made there and we are forced to embed there for us to actually have access to the digital resources or have access to something like that but still it creates other opportunities to counteract but this is quite not enough until we do have ownership of the traffic of the infrastructure in a way that we are quite interoperable in parameters of equity openness decentralization and end-to-end this pillars that created the internet we're still having a big power dynamic on how we could relate an internet that actually represents each and everybody and in that regard we all have our own ways of understanding democracy there's the theoretical model and the practical model so in the end a consensus needs to be reached of what it really means to be part of a global village and how we implement that from the infrastructure level in terms of the real network to the level of what it means for us as a community maybe we can before we move on outline the connection also that exists maybe we have a couple of examples between the problem that we have very centralized power structures and often not decentralized infrastructures and the possibility that that gives to more authoritarian governments or governments wanting to control their citizens and makes their life much easier than if we had more decentralized forms of infrastructure so for instance like internet shutdowns or other forms of social media control of course we face this and it's it's like a script book that's happening most through african governments right now that using it every election comes with an internet shutdown and why why is that it's just a form of control of how information flows control of how people should interact and how people should think this is not a model that sub-saharan africa or africa actually innovated they just copy and pasted based on a lot of lobbyist and corporate advice that they were given in how to actually manipulate an election but once you manipulate an election you manipulated people and you still you're back to the same indoctrination of colonialism that happened and it's sad to see when governments actually in the sub-saharan africa use that same rhetoric of colonization through the internet so the internet is a tool that is quite powerful but the internet is also a tool that can be abused you know abused meaning that it doesn't have meaningful use to the end user in the end a democracy is built by the end user a digital global democracy is built by the voices and representation and diversity of the end user digital civil rights are actually quite important and that has to begin with forming really open dialogues such as this on how we counteract governments using these uh whatever crony ways to manipulate a population while the intent is actually having a connection that can actually build something together and change the world progressively as we you know intertwine as a union and unify humanity thank you Renata and maybe also Nadini if you want to add some examples yeah I want to like you know one of the when I was thinking about I'm preparing for this connection of global justice and digitization the politics question came to my to at central central stage because the way that digitization is affecting elections is affecting time at policy and is delaying and making very difficult to achieve the the commitments that we need concrete example Brazil Brazil and Bolsonaro I mean this weekend I guess that one of the most important elections for our planet is taking place and at the center of the stage are social media companies fueling as never before hate and misinformation and and it is very very very complex and of course the thing is can we trust the companies and can we trust the companies that they will be like neutral and they will not sell themselves to those who can pay with favors and with money the most can we can we also be certain that the us will not med meddle in the election through the companies that they control and can we can we be certain that those who own the companies will not favor the candidate that would make their lives easier operating in one of the most important markets in the world and unfortunately like if I was sitting at the like you know electoral authority of Brazil I would not be able to be certain that they are not meddling an election and they are not like you're causing they're not suppressing votes that they are not like you're doing lots of nasty things why because I have no access to the set of instructions that I like dictating which information is displayed to my citizens or not and then you go to the other extreme because like you know the extreme that some countries take is to simply shut it down and and of course it is a move that is authoritarian but at the same time what do you do you know like if if you are like you know in a country where you are like aware and have hard evidence that the actions or missions or the toxic algorithms by a company are like you know fueling hate and and leading to real life you know like confrontations and even assassinations what do you do you know like and and it is you know we are like kind of trapped in this conversation that the only way to communicate an exercise or write the freedom of expression is through these damn companies and unless we either like you know they change the model and they show us everything are subject to very high standards of scrutiny or we decentralize and simply abandon them we will be in this in this dynamic that is only getting worse a quick example was the it was very sad one of the most progressive constitutions for the environment and for people was about to be approved in Chile the level of misinformation and disinformation spread to social network played a tremendous role in the in the citizens voting against a constitution that was good for people good for the planet good for social justice so we cannot isolate the effect the harmful effect these companies are having and the responsibility of digital rights organizations to getting it right uh in uh in moving moving to the next step I am very concerned about it and I mean seriously I cannot I cannot think of better solution but you know like really creating the alternative decentralize an interoperable green alternatives that we need we need to get out of them basically we cannot fix we cannot patch it is too late and we cannot depend on something that we cannot see we cannot have faith on corporations it's a really important point you made I think really of central importance to the debates that we're having right now because I find myself a lot of conversations at the intersections of climate justice climate advocacy and and and our digital realms let's say and this idea that we cannot create the change that we need to save our planet fast enough but at the same time of course do not want to see this as an undemocratic endeavor so we need to move with the democratic systems we have and that means electing the right parties I'm just repeating what you said now but if our democratic systems are being undermined by the powers that you just described then we're not going to be able to create that political environment to create the change and that's a very dire situation to be stuck in Nandini do you have any examples you also want to add from your side on the effects that you're seeing in correlation between power asymmetries infrastructure control platform control data control and and how that is surfacing in in the Indian society or beyond I would like to add a one point to what Renata said without addressing data extractivism we cannot recover the infinite and I want to draw attention to how digital trade agreements are very important to look in this regard the the provisions that are being negotiated in the digital trade agreements including in the free trade agreements that European Union signing with countries of the south will prevent the scrutiny of the algorithms of the social media operations which will prevent us from addressing situations like the one that Renata mentioned and we should also look at how these companies using their algorithmic power are controlling agriculture they are controlling labor markets and they are controlling pretty much every aspect of economic activity away like for example in India we have a concern that farmers movements are actually talking about the alienation and capture of farmers data by let's say big tech companies and other intermediate data brokerage companies which might potentially open up the agricultural smallholder farmer market to big agriculture and big tech and so if we have to talk about corporate accountability and holding the big corporation accountable I think the first thing we should be talking about is how we need to get out of the equal footing multi-stakeholder is a model of internet governance that has come in forums such as the IGF thank you is did you want to add anything to the trade agreements point just agree on that and on top of that the next generation of trade agreements to my first point that I just referred to in the introduction of secrecy trade secrets on steroids for the next generation of trade agreements that your representatives are supporting as a bloc as the European Union so all the blah blah blah of green new deal and green technologies for all and all is empty talk because in the global south your leaders are imposing these rules that will impede us from even auditing whatever you are doing in our countries let alone share the benefits of your innovation so we can scale solutions rapidly just that thank you um so I mean we have touched on just a few of the potential topics that we could be touching upon when we talk about digitization and global justice and the power asymmetries we have not even really begun to talk about the data asymmetries um and and the effects of the gig economy and platform economy so this is a conversation we could be having for another couple of hours but looking at the time as I said in the beginning we also want to try to look ahead now this is a very kind of not easy point of departure after you just said it's all too late we need to scrap all the social media platforms so we'll get back to that in a minute but um seeing that this is the world that we're facing and as I understand maybe we'll start with you Gabriel because I understand that you are very much working particularly with this demography of young people who are trying to reimagine their digital futures um but of course it needs to be acknowledged that we're facing these really stark power symmetries and it is not easy to break out from them so where's your kind of vision or your hope and what is it that you're trying to work towards with your organization in this regard um 5.03 billion people are connected right now in a single internet that has the nomenclature in context with protocols that we all abide to is that abstract level where it's I can just take a phone or a computer and go to the internet and make impact or change my life but now that is under threat just because of the corporate greed as well as the political layer of influence but we have an opportunity of decentralization that comes up as young people we should stand first for a unified digital front because if I might ask you dear audience what is the color of the digital world what is its religion or political affiliations not there but we know the impact and the purpose and for something to be purposeful to be meaningful someone should know how it operates in their regard for us young people we are first fighting for a unified internet for all in terms of inclusivity diversity accessibility and affordability to know that we are connecting the next billion from the global south we need a global internet that actually speaks the language represents its sake and that is important we see organizations such as I can working for internationalized domain names rather than just the latin scripts that is important we need first an internet that can actually understand different diverse opinions not only from how it looks like in the ai models but how it actually speaks it writes and the content inside that is important to know because now we also have content moderation and that is a big topic that people are afraid to talk about content moderation for me I think it's a form of indoctrination and trying to control your thoughts it's good when we kind of filter something but it's important to actually stand for those freedoms of expression and those freedoms of thought that we are awarded by by being connected that is important as young people we are fighting to create innovative spaces that are equally distributed web 3.0 is part of a solution but still in the global south perspective we are still furthering the digital divide because it only happens here so we can only do this with intergenerational alliances based on the dialogues we have open expression we need and actually creating a framework of accountability where the internet stands for the liberty of the end user and the communities of end users are bucketing having a concrete voice to fight for an internet that is more open and more useful and meaningful for the next generation. So how do we you know there is a beautiful vision of course we've all worked in so many spaces where the power of technology for good is so incredibly apparent as you also explained you know the history and and genesis of the open knowledge foundation and the important work that it's been doing but having come from the conversation that we've just had now you know the idea like okay we need to scrap it all and reboot but if we don't have the money or the partners to do that like how's that going to look like where can we begin to reimagine these structures I think that then inequalities come to the center right and it is we need to really change them I mean the thing is like maybe from what I have been saying I sound like someone who does not like technology very much I actually do like it and I still work in the field because I still believe in the tremendous power of change the thing is that we need to rethink which technology for what and and then when we fix our priorities as a community and as a society we need to like you know target our investments and do not waste on distractions you know like which technologies for what if if we are thinking about that at the foundation and we were like which technologies for what one of the most important barriers for good for example it's a concrete example for good climate policy is to have you know real-time data and most of the governments even in the developed world are dealing with data of three years ago or four years ago we cannot decide on with changing circumstances that are so fast and they're affecting directly our communities we cannot we can we really you know the first upgrade the first and basic upgrade that we would need is to build capacities and and develop you know like the cheapest leanest greener technologies that will enable easiest easier to use that will enable even the smallest unit in local governments to be able to collect and produce the data that we need for critical things that's just an example you know and if we look at the budgets at the moment if we study the national budget and the most a lot of money is going to be tech and I think that I think that we cannot say that you know like that we if the things are functioning like you know to provide infrastructure for you know like the vanity infrastructure of certain social media we need to rethink our priorities as a society and re-invest in the critical things that we need right now I think that the solidarity commitment that needs to come from the global north is again opening up the innovations that we you are developing and using right now so we can adapt adopt and adapt them locally because at the end of the day your survival depends on our survival as well and we need the best information possible as a human collective but but in my I don't have to be honest I don't have a plan and I don't have numbers and I think that is something that the community the public policy community the community working for social justice and for climate justice and the digital rights communities need to sit at the table and have the numbers and have a plan for it and I think that that plan is missing I think that I think that we have been distracted a lot and or you know spread so thin a lot in such subtopics you know as for example the effect of a specific technology in it's like you know tiny little you know corners and we need to like you know get back as a community to work on the global picture and to have a basic plan I don't know how and I don't know how how to make it happen but it needs to happen very soon yes it does thank you Nandini how is IT for change trying to reimagine or support communities in their efforts to reimagine digital structures and where do you see possibilities for intervention in the Indian context so also beyond yeah I think that in order to reclaim the power of the internet there are two things that we have to do we have to separate the question of how do you reclaim the internet as a trans local public sphere from the question of how you leverage the power of data for maximizing social value and for ensuring that public good is truly achieved what do I mean by that typically when we talk about the regulation of the internet platforms and the internet public sphere usually we get into this very unhealthy binary between talking about preserving the global internet and preventing internet fragmentation or splinter nets right but I think this is probably the wrong way to answer that question and so at some level we need to be asking the question why do we need a platform model of the internet at all why do we need vault gardens why is it not possible to recover the transformative power of the hyperlink and like social media scholars like Ethan Zuckerman and others have pointed out why can't we build a truly decentralized interoperable social media media architecture and whose normative governance would probably be something that is grounded at a global level in terms of human rights principles to guard against the excesses of both state and corporate power so this is one point the second point which I think has to be tied to the development aspirations of the global south and the autonomous aspirations of development of the peoples of the south have to be respected is this particular point and on this we are doing some work in India where how do you actually create models that will leverage data value without mimicking data extractivism and without being luddite and completely rejecting data and the power of knowledge generated from data insights for enhancing productivity right so with pharma communities in two or three sites in India and in partnership with social enterprises and cooperative federations it for change is piloting an alternative model that is actually trying to use the power of data for expanding workers own autonomy farmers own decisions about farm enterprise productivity for sustainable small-scale farming and in this regard we are also studying this interesting experiment that the state government of Kerala in India is doing where it's actually piloting a platform with small holder farmers in one district where the farmer producer organization and the local panchayat which is the last you know local government institution there is an attempt to create a platform commons infrastructure and the whole idea is that across the entire farm production cycle at every stage from input support to advisories to market linkage and to ensuring blockchain trace ability for ensuring the organic farming certification of the farmers participating in this experiment the state is doing something and I feel that the public community partnerships and the public worker organizations partnership where we are talking about a network data scale that enables efficiencies to be achieved through federation rather than through centralization so that we go back to the true generator power of network data infrastructure that is the platform the quest is really for an alternative platform firm yeah I think all of that was really cool to hear and extremely well understandable also thank you Nandini in particular also that it is possible to reimagine an internet that is not based on the platform model that we have today and I think that's exciting to hear how does that relate to some of the conversations that you're having in terms of not just seeing access perhaps of something to be limited to physical to access to the internet per se but also access to the right kind of data to work with the possibility to have that seat at the table as you were also talking about in the multilateral context earlier Gabriel for most of the sub-Saharan Africa we are buying a model called community networks this is an alternative model of connectivity that is actually embedded in the community values we are using TV white spaces to boost connectivity and most of the ownership structure is for the people and embedded through them so it comes as a package of where you're giving them the infrastructure as well as the literacy combined together to see how much they can actually connect so it's not a matter of being embedded to this isp or whatever it's just your community creating a whole new ecosystem of being connected in an interoperable network and that is something that has quite worked in terms of financing there are also alternative ways of financing for you to be connected community networks do not need for you to have a financial incentive for you to get there but they're trying to see how they could use other other means of financing such as agricultural commodities or credit-based mechanisms just for the sake of people understanding what it means to be meaningful connected and community networks I think are quite a new frontier in regard that they actually teach the community how to create a network how to utilize a network and how to empower themselves with the connection and that is a model that is quite working for now we also have other models which are brought in terms of private and public but public non-profit partnerships in creating more connectivity such as we have SpaceX coming in with the new technologies of in terms of rural areas this is something we are working with in at Omukahab in boosting more connectivity for the rural region but still the most important thing is it's intertwining with the literacy scale because when you don't understand something you really cannot utilize it so for community networks it's a big platform and it's an alternative model that has been a success story for most of the communities in the global south I'm really glad that you just mentioned this topic Gabriel I'm gonna just add something to that very quickly because I think there's so many conversations that we can still be having that are just starting to blossom now at the intersection of our communities and this is a really great one so in I have run this NGO called the Global Innovation Gathering and we just had this online sharing session with the APC network together so a community that brings together a lot of these wonderful community network initiatives and we were talking about things like building towers to put your connectivity devices on out of bamboo and regenerative materials and how to create them with local resources but we're also having a conversation about the energy saving that can be done by using community networks where appropriate and seeing how the combination between community networks and then of course linkages to the internet can be seen as part of an energy consumption and creation discussion as well so I think there's a lot of potential in these conversations as I said in the linkages between our global climate justice and digital rights communities I want to as we're now sort of moving into that final topic of the conversation get back to something that you said in the very beginning because this is I think also such a key aspect and with this maybe also look at what are our asks to governments here also in the German context we're in European context but also to other governments that might be willing to listen so at the moment I feel we have this very strong idea that we can get over the global problems we're facing through innovation a lot of people are pushing this narrative that we might be able to combat climate change because we're building all these great carbon capture technologies because we're creating other kind of technologies that will help us through this crisis however what you said in the very beginning is just what I think is key in this it will be impossible for the unlock these innovations and the proprietary domains of individual companies and have no way of making them accessible wider to the world so where do we break through that innovation narrative and create meaningful ways of open access and and and therefore perhaps actually harness this power of innovation to stop climate change I mean I think that it goes to is a money question basically is a money and rules question the first the money question is like if you look how innovation so-called innovation is who's receiving the funds for innovation right now especially in digital it goes massively to lots of you know profit-oriented startups that are still in the old model in a destructive model and and they have like absolutely they have one mission you know like be as interesting and as successful enough so you will be eaten by a Silicon Valley corporation and that would be like you that's you know like your big success your big success is to be acquired by someone else even abroad you know like if you think of European funds and if you look at the budget that goes to digital social innovation it's tiny it's like super super little tiny you know like it's the funds allocated for citizens to start like thinking of collective solutions that have not profit as the main goal but had like you know like actually progress in mind towards the goals that we have as communities it's it's like a lot needs to be done on more funds allocated better with different rules attached to that kind of innovation I mean I have to recognize that European Union has done a lot in funding projects like decode that was like always open source or is there for people to innovate but after after a nice project the last two years what happens we need also to allocate the funds so these nice prototypes can be localized in communities and in communities in the global south when I see that you know the cooperation the cooperation agreements with the global south of from the European Union often comes with a clause that you have to hire and you have to use European companies to implement so it's not really cooperation it's a way to open markets basically without competition for the countries in the global south to to create the solutions the big the other big problem that we have is patents I don't know why we haven't I mean it's incredible that the European Union actually blocked the possibility to have vaccines for all even the US accepted to open the vaccines and it was when when I was involved in my early twenties in the trips and negotiation I was like you know there was this clause that I was always a skeptical skeptical about of exceptions and that the global pandemic will be an exception and will trigger this possibility to have like you know equal access for all as fast as possible in terms of vaccines it didn't happen I think that when as we move forward and and start like you know enacting legislation for climate change we need those clothes that this we need to rethink how we are pro protecting ideas from scaling and if I think of for example okay innovation should be like compensated fine okay let's let's give them money in advance if you are like having really a good solution that can scale let's let's you know let's open it as soon as possible for as many people as possible so we can reach the goals I believe that we if we play by the same rules same rules that we have today we will not overcome the difficulties that we have and the other is the secrecy of corporations you know like back in time it made maybe sense for some that Coca-Cola will keep like you know secret the formula right now the systems are so complex that you know even if they were open will be like easy for us to understand what's going on behind closed doors not only that this is very difficult to audit the missions of companies even tech companies and other companies because we like the information that they're making available is selective and because the trade secret laws gives give a corporation that has sometimes more power and more influence in climate policies in the whole country the ability to hide what is really going on behind closed doors so if we don't rethink transparency we think the obligations of access to information that a corporation should have to citizens and rethink the agile forms of innovation we will not overcome the greatest challenge of our time yeah thank you so much I would have I would have applauded there if I were you and looking at this from a private funding as well as from a public funding point of view you were speaking about earlier all this money going into deep tech so this is something also I think if we look at where as we see money going but also where as development money going going into startups and going into funding innovation and the African continent you can see this big run for the fintech sector like everywhere else and there's so much money going into fintech startups into crypto startups and very little money seems to be going in from these r&d and startup funding cycles into other more access giving more democracy building systems where would you wish to see a change in these funding cycles and these innovation focus programs Gabriel as much as it's a financial issue it's also a capacity issue immanuel count once said politics without policy is empty and policy without politics is blind and most of the times policy is blind to these areas especially when money is part of the conversation I'll tell you a small story about Naomi we had a connected African girls coding camp in Dar es Salaam where the goal was to bring these young ladies from rural regions who did not know anything about digitalization or connectivity but to give them that space to innovate and see we had a really small budget but the end product really was inspiring we had 10 girls from rural regions 10 girls who were visually impaired and some of them were deaf they actually created smart systems which were powered by solar you know for us when we talk about policy we say like we are lacking funding where we're doing this we're doing that but for them it was more important to get the skills and empower themselves because I asked Naomi you come from a place where there is no electricity how will you charge your tablet how will you use these skills he said it's okay I have solar we we can build our own turbines and for me it was crazy I was like wow these are the solutions which we need so civil society an informed civil society should get the funding first and private public partnership with civil society should be incentivized more than they go to startups because you go for fintech that's all right you go for creating this innovation startups that's all right but until we create more girls like Naomi who actually have the capacity where you can actually see the funding have impact on their community then we can solve the problems because Naomi understands that you know we live in a challenging world with climate change she doesn't know about electricity all the abstraction but she knows that with the skills that can actually change the world and that came through a partnership and funding directly to the society and the stability and the end user and Naomi was able to change the world and change her perspective so these findings should be highly equated in terms of empowering the marginalized community who actually will have the solutions we need because for us and some part I might say we are already indoctrinated by this policy development systems where we might think you know it's a complex structure this and that but actually empowering them with the financing and the capacity we can find the solutions and that is the beauty of diversity absolutely Gabriel I think that's such an important point that you just made that is the question we should be asking ourselves like what does Naomi need to have the access to the information access to then also share and scale her idea without it being bought up and locked away by the next corporate so thanks so much for bringing in that example Nandini maybe over to you before we open up for questions do you want to add any points to this conversation about the different r&d systems we need the different innovation cycles we need or perhaps also expand a bit on the point of data autonomy that you were making earlier and how how we can connect that conversation yeah I just had two quick points to add so firstly I think that when we are looking at responsible digital innovation that will address the climate change crisis we need to seriously start looking beyond the carbon-free energy pledges of big tech because if you just look at a report from last year of how alphabet the three tg minerals gold tantalum and tungsten from the amazon belt flouting most of the guidelines including the OECD due diligence directive on the mining of such rare earth minerals then we are actually wondering what is it that we are talking about you know when ensuring these carbon-free energy pledges and we should be talking about how do you actually hold a big tech accountable for their environmentally destructive practices so we should be doing something there secondly I wanted to call attention to this entire field of synthetic biology where many of you might have read about this somewhere that the world economic forum has launched this initiative called the earth bank of codes where the idea is that the database which contains the genetic codes of every single organism that has ever lived on earth right plants animals fungi bacteria microorganisms and so on and if you have such a open genetic repository but as Renata was pointing out earlier digital gene sequencing techniques and other things which will enable innovation from this repository and the enclosure of the intelligence and the analytics and the pharmaceutical knowledge and other developments the right from it that's going to lead to a lot of inequitable innovation and we are actually talking about the enclosure of the bios and the life world itself and that we should be highly concerned about in terms of climate change because what would it mean if such inequity persists in terms of control over the bios and finally the last point I think that if unless we get out of the venture capital funding a model we will not be able to do innovation that is grounded in the social good and it is not just interested in furthering the extractivism and here I think I come back to an agenda that we have often stopped talking about because you know most of us have tired and it sounds boring and things like that with us the question of official development assistance what about the question of official development assistance to the south for building autonomous platform data and infrastructure when clearly the entire market route of technology transfer has not worked in the digital technology space and shouldn't we be having this conversation since the summit of the future is just two years away at the UN level and it has been nearly 20 years since the business but we have not progressed at all on this and instead we seem to believe in some happy go lucky multi-stakeholder models where some combination of private financing and community partnerships will lead to technological innovation that is equitable and sustainable so we should probably be going back and looking at these assumptions. Thank you extremely important points added it's just like oh my goodness 20 years since visas but yeah that is true so let's take a couple of questions you may raise your hand and we will try to find a way to come to you with a microphone comments and interventions all welcome I will wait a moment to overcome shyness and I see a hand come up so I'm now going is this is that okay or shall I go? Hello I'm Agnes I'm leading the Hexen of the CCC and I actually have a question um I'm also a scientist so I do have the background for something bioinformatics actually I think the innovations are already done it's just about getting them where they should be right so it's about making it getting it done making it real everywhere and I was wondering if I had now I'll listen to the last 30 minutes if you were focused very much on innovations that are in the future this makes you unable to see that you actually should be doing something and I was wondering would you have one or two more practical orientations for the people in the room so that they do something so that we try to get our minds away from thinking about the next innovation especially carbon capture let's just not think about that one so you mean concrete things we should be asking especially governments for now that they need to do now right as concrete as possible because I think this is the thing that's lacking actually we have already lots of science on the ground we just need to do it but what should we do as the first three points or so cool does anybody want to take that first yeah I'll definitely take it uh first of all we need to understand that it should be beyond the government question because democratic governments are made by us we are the ones with the power so for you to make change start sharing creating partnerships with the local initiatives with local with local NGOs with local civil society movements and we can have this open transfer of knowledge based at a very grassroot level that is important at the government level we should reinforce how open data is transferred from one area to another where we have concrete sharing sharing exchange capacity points we see like the EU has quite a good framework of exchanging capacities and we really need more incentives and we really more really need more innovations in the space of exchanging capacities and literacy especially from having women in tech like you sharing two areas such as the sub-saharan area when what we could do and the innovations that are possible because through that lens we could actually make the change that we need but your voice will count and you're the one to actually initiate it Nandini did you get the question like what do we need now from our governments what would be your answer yeah say that we are in a very difficult spot which makes the technical laying out of very concrete clear concrete steps difficult because what we are dealing with is a moment of discourse capture as far as the fight for an equitable digital order is done so everywhere there is the idea that you know as long as we do global data flows with the trust there will be a market that is privacy and basic first generation human rights protecting and the market will do its job and innovation will happen this is the mainstream discourse in the digital space that we are up against so again and again at the multilateral level and with our own governments back home we are in a moment where we actually have to reclaim the space to talk about the fact that public investment in digital infrastructure because that is the meaning of developing the digital as a global public good we have to re-establish this message and we also have to re-establish the message that just because the internet was born in a very unique historical way it does not mean that equal footing multi-stakeholder is some governments and corporations are sitting at the table and deciding what happens to the internet is the way to make rules for digital economy and society so I feel a lot of what we are saying here when it comes to reclaiming the digital may sound a little bit loose a little bit like you know ambiguous but that is because I feel it's the battle is about a battle of like discursive power and we are challenging the neoliberal hegemonic vision of how the data paradigm should be and this is the most important fight because like the fight against historical colonization teaches us unless you are able to claim epistemic freedom and reclaim these alternative imaginaries the fight on the ground cannot succeed a lot of mic drop moments and then these statements today what would be your asks I mean I have very little to add to them but I would say that a very simple step very concrete a step is pushing the universities and the institutions that we work on and number one to make research reproducible but really reproducible it is like the numbers of scientists making the data sets that they based the research on open and usable is very very very limited and that would make a big difference for researchers in the global south to understand you know your methodology how you came up with to the conclusion and applied locally the second thing is make that you know the possibility of human exchanges real I think that the sharing skills and you travel into the countries but also people from the countries where do you know like that the solutions are needed urgently traveling into the centers of innovation is very needed and personally with my team I have held to bring them to Europe for example or it is so tragic that you know like that we still have the main barrier okay free flow of data super restricted flow of people you know like and and you will never get you know different sides of how to localize solutions technical solutions if we know if we do not make fair migration rules you know like it takes four months and many knows to for example my stuff in the Philippines or my stuff in Nepal to come I mean it should like you know it is a very fundamental thing like pushing for better rules of exchange of knowledge in the form of sitting together at the table and looking at your solutions and saying actually that would not work in my country is very very very important and and the third is localizing I mean like we live in an English dominated world and even if you know like it's so much lost in translation and so a lot of knowledge that is not really reaching the places that need to need to reach you know so advocating for budgets of translation and localization is a very small thing but it makes a big difference to have materials of the latest of the latest there's knowledge at least accessible in as many languages as possible just three three very simple and concrete things that we can do to use the power of digital and but also the power of people to to scale the innovations that we need thank you any will we have time for perhaps one more question if there are any other hands going up maybe short comments sorry for my English I had the impression that your opinion is that maybe basically what Renata said that a big companies that control internet represent directly US interest I have different view I think that this is just a tool that can be used by different powers for different reasons and there is a matter of value I mean in internet was used by Trump to destroying American democracy is used by putting to to destroy democracy in in Europe is it was used in the brexit process it's a simple tool so it's a matter of value it's a matter of who is using this tool and what we can do is first fall to protect values democracy and then have some hope that in this environment we can influence somehow who is using this tool and for purpose that's why I see this opposition that you say more about who is controlling internet and and Gabriel is saying more about providing more connectivity so because that it's maybe hope or disaster and put it briefly because I know that there's no time for that because there was nothing about Chinese companies Russian companies here there was no this perspective so if I had the choice to live in Beijing Moscow or New York I still prefer to live in New York because there is more chance that they can do something thank you and there is a war close from here there is a threat of using nuclear weapons I never had about this in this conversation so it's quite strange for me that so close from Russia and these threats that are posing by them there is nothing about this here we are not having a conversation about that topic matter otherwise that would have maybe featured so I didn't quite understand the comment on the threat of nuclear war which is as you can imagine for people living in the city very much on everybody's mind in a current and historical sense so I do think we did mention China briefly do you want to have a circle on the panel to talk to just give a little bit of a reflection on what the gentleman said about the other sort of yeah forces up against I do think if I understood your comment correctly that we are very much in line with what you said in terms of wanting to build a digital future that is based on our democratic values and that the definition of that needs to also be part of a global conversation and exchange so that that's not dominated by few people again but really a global undertaking just as a quick reflection as just quickly technology is not neutral it's political and it's influenced by politics as we have seen in the concrete examples that you gave and it cannot be like you're only regulated by market rules because it is too important like you know like as we can say if someone has the money to pay an influence it is it it is wrong I refer to the concrete case of Latin America in Latin America the influence of Chinese companies is still minimal and is I mentioned it to the hardware layer I didn't mention I'm very lucky and we are very lucky in Latin America that at the moment you know like most of all we are like a region of peace and most of the armed conflicts are like yeah they escalating but we made a mistake not to not to mention other conflicts ongoing conflicts in the global south as if you think of gem and as if you think of the situation in Afghanistan for example and so on I think that we also do not speak enough of real ongoing conflicts for years and decades that are in the rest of the world and are not as close to Europe but as relevant but this was a panel dedicated to the global south so I focus on that and on on the point of the relevance of Russia and China and so on and the companies what we have in Latin America and it's good that you you mentioned it is very complicated because for example in the case of some countries they have embargoes so they have to circumvent the embargo to keep the countries connected by opting to the countries that will sell them access to the hardware and software they need to function I mean I'm thinking of a concrete case of Cuba, Venezuela, Nicaragua regardless of what you think of the political governments citizens in those governments have a right to access right and which is like right to work and so on that is completely cut by sanctions so it's very complex and it's all interlinked and I really hope that we move very soon to a word that is not dependent on who controls the weapon arsenals and of course the effects of of this European war that is not the only war and it's not the only armed conflict going on in the world right now it's having terrifying effects on the food security and and on the geopolitics of many fragile societies and of course it's a cause of concern and it's we could spend the rest of the day discussing but I'm afraid we have run out of time we have time for applause so maybe just as a tiny tiny limited to 30 seconds each closing round is there something that you want to shout out to the audience in case they want to follow your work and keep part of the conversation that we've had here in regard to yeah your respective workplaces anything you want to plug Gabriel definitely for me the internet should be a human right and we should have intent for all because that's the only way we can truly be equal and cultivate a intergenerational alliances so for me I'm active at omuka hub you should see as the director gabriel castle also on twitter so you could follow and see what you're trying to do and I'm really open to speaking to you to see how we could form correlations and thank you so much for the privilege of having me here awesome thank you nandini anything that you want to plug any exciting pieces of research coming out or other activities of it for change or anything else you want to share with the audience yeah I just wanted to quickly say that typically we tend to polarize the US and China model without actually looking at the facts of how Chinese companies are most dominant in their internal market and also not looking at the fact of why countries in the global south opt for the digital silk road because it seems the lesson of the two evils and my last point is that for progressive organizations like it for change in the global south what we what we would want to emphasize is that when we are talking about a new digital sovereignty third way human rights approach that the EU will lead it's equally important that the digital sovereignty of countries in the south are also respected so what's happening in the domestic market and what EU negotiates in the trade agreements in our analysis from a progressive perspective we need to look at like both these parameters when we are talking about digital sovereignty because it's not a simple end of history type of question about liberal capitalism or like you know some authoritarian communist version of the internet thank you just as a final remark another digital future is possible it is learning a lot from the environmental and sustainability communities and it is happening and it will happen in different forms and shapes that hopefully will be tools to decentralize power and to interconnect efforts to save our planet thank you all so much for this really exciting discussion all of you for coming out this early on a saturday morning


In this presentation, we will take a look at multiple choice questions related to corporations. First question, power value a, common stock issued at low price, b, amount assigned by corporate charter, c, market value of stock, d, price stock is sold at, or e, priced used to calculate dividends. So we will go through this again and use the process of elimination and see if we can narrow this down. Power value a, common stock issued at low price. So power value is common stock issued at low price. If it was issued at power value possibly, but it doesn't sound right, I'm going to say that's not it, it's not a, it's not common stock issued at a low price, power value. B, amount assigned by corporate charter, that sounds kind of reasonable possibly, we don't know what power value is, we can say maybe c says market value of stock and again we might say maybe power value, market value, maybe those are the same thing, d says price stock is sold at and again we might say I don't really know maybe d and then e says price used to calculate dividends and that one seems kind of unusual, why would we use a price to calculate the dividends, I mean the board of directors would have to come up with dividends that are going to be paid somehow, maybe they're going to use a power value but not necessarily. So I'm going to say e doesn't look right, I'm going to be left with b, c and d, let's go through this again, power value either b, c or d either amount assigned by corporate charter or market value of stock or price stock is sold at. Now of those three, if we say power value and market value, probably aren't the same thing right, market value of stock is not going to be the same, exact thing is power value unless they're just two words for the exact same thing. So market values doesn't look like it's probably going to be it, price stock is sold at or amount assigned by corporate charter and again price stock is sold at probably is the same thing as market value, that's what we're going to sell the stock for, whatever we can get for it. So c and d are kind of the same thing, c's, d's basically defining c, can't be both of them. So I'm going to cross those out and be left with b which is the amount assigned by corporate charter, which is what the power value is. So the answer is b and just so we know the power value is just an arbitrary number and that's going to be the amount assigned and the reason is just to have conformity with the common stocks so it can be all standardized. So final answer, power value b, amount assigned by corporate charter. Next question, amount received from stockholders in exchange for its stock over the power value is posted to a, common stock, b, preferred stock, c, gain on sale of stock, d, additional paid in capital, e, stock is always issued at the power value. Let's go through this again with the process of elimination. Amount received from its stockholders in exchange for its stock over the power value is posted to. So if we can break that down, if we think about it, we're saying, okay, we're receiving something from the stockholders in exchange for stock. So we're selling the stock and we got money over the power value. We got something over the power value, whatever that means, right? So if we don't know what that means, we'll go through the process of elimination now. A says common stock, which is kind of what they bought. They bought common stock. That's typically, so we might say, hmm, A, maybe, B says preferred stock. Now typically when we buy stock, we're referring to common stock unless stated otherwise. So it's probably not preferred stock, I'm going to say that doesn't sound right. D says gain on sale of stock, which sounds kind of reasonable because we got, they're saying that we got more money than the power value of the stock. So maybe the stock is somehow worth the power value and we have a gain on the sale of stock. So I'm going to keep that for now. D says additional paid in capital, and again, that might sound familiar as something that's just like in the equity section of the stockholders' equity if we don't know what it is. So we might go, hmm, I'll keep that for now, it sounds familiar. But E says stock is always issued at the power value. And that doesn't seem reasonable. Why would we always issue the stock at a set price? We're going to issue it at whatever we can get for it. It's just like any other type of sale, sale of something, right? We're going to get as much as we can. So E doesn't seem right. So we're left with A, C, and D. Let's go through this again. Amount received from stockholders in exchange for its stock over the power value is posted to. We're left with A, C, or D, either common stock or gain on sale of stock or additional paid in capital. So we got an amount received from stockholders in exchange for stock. So we did sell stock and we sold the common stock. But the common stock is going to be recorded at par value. So what we're really saying is we got paid something over par value. So it's not going to be the common stock because we're going to record the common stock at par value. If you think of the journal entry, we would get cash, right? It might be good to write down the journal entry. We would get cash, let's say $100. And then the par value would go to the common stock credited, let's say $90. And we got more cash than the par value, let's say $10. Then the question is, well, does that go to a gain or does that go to additional paid in capital? Now it's not a gain because we're not selling something of operations in the partnership. We're selling of the corporation. We're selling the corporation itself. We're selling an equity interest in the corporation. We're not selling like an asset in the corporation. So that means that it's not a gain from selling something that the corporation owns. We're selling a component of the corporation. So it's going to be something in equity and that something is called additional paid in capital. So a final answer, amount received from its stockholders in exchange for its stock over the par value is posted to D, additional paid in capital.


Hello and welcome to the session. This is Professor Farhad in which we would look at the topic of inflation and real interest rate. Those topics are covered on the CPA as well as the CFA exam and in essentials or principles of investment, graduate or undergraduate. As always, I'm going to remind you to connect with me on LinkedIn if you haven't done so. YouTube where you would need to subscribe. I have 1,700 plus accounting, auditing, tax, finance, as well as Excel tutorial. If you like my lectures, please like them, share them, put them in playlists. If they benefit you, it means they might benefit other people. Connect with me on Instagram. On my website, farhadlectures.com, you will find additional resources to complement and supplement your accounting, your finance courses, as well as this course. So let's assume you have $100 today and the bank is offering you a 10% return on it. So if you deposit this money, a year from now, you will earn 10%. So simply put, a year from now, you're going to get your $100 plus $10. That's your rate of return, 10%. It's going to give you $110. Let's also assume today, this basket of food, it will cost you to buy it $100. This is what you will need for your food, milk, meat, eggs, banana, fruit, vegetables, all sorts of things. A year from now to buy the same exact food basket, it will cost you $106. So what really happened? Here's what happened. You deposited this money in your bank account, this $100 that you had today. You could have bought the basket of fruit or the basket of food. And a year later, you got $110. Here's what happened. This $110, now to buy this basket of food, you will need $106. What does that mean? It means you lost some of your purchasing power. Why? Because the same basket of food that used to cost you $100. Now it's costing you $106. What does that mean? It means your purchasing power went down, although it's the same basket, but you have to pay more for it. How much more? $6 more. And in the bank account, you only earned an additional $10. What does that mean? That means you earned $10. Of that $10, $6 went to inflation, Arap would inflation. What's left is $4. So the $4 is your real interest rate. So here we're going to call the $10, the $6, and the $4 something, they have specific names. And simply put, to approximate the inflation, you can take the real rate. It's approximately equal to the nominal rate minus inflation. Well, we did not define those. Let's define them in a moment. So what is the nominal rate? The nominal rate is what the bank gave you. The nominal rate, for our example, is 10%. The interest rate in term of the nominal, not adjusting for purchasing power. For our example, was 10%. The real interest rate, the growth rate of purchasing power derived from the investment. Well, although you earned $10, $6 was eating by inflation because the basket of fruit went up by $6, 6%. What's left is 4% or $4. What is the inflation rate? The rate at which prices are rising measure as the rate of increase of the CPI, Consumer Price Index. Usually it's a basket of food. And for our purposes, CPI went up 6%. So you have to know the nominal rate, 10%. Real rate is 4 and inflation rate is 6. And let's go back to this formula. So if we take the nominal rate minus the inflation will give us approximately, this is a dirty and quick shortcut to find the real rate, 4%. But this is not the real formula. We're going to look at the real formula in a moment. It's just, it's a dirty, quick and dirty shortcut. Okay, part of your interest earning, which is the $10 had been offset by the reduction in the purchasing power of the dollar you would receive at the end of the year. And this is what happened with the 10% rate. We net out only 6 after you net out the 6% reduction. What's left is 4%. So basically this is the real rate. So your purchasing power increase in proportion to the growth of invested fund, but falls with the growth of prices. So that's fine. Your rate, your purchasing power increase with the growth rate, the 10%, but as the prices of the goods rises, your purchasing power falls down. So when you earn 10% or $10 from your bank deposit, but the food basket increased by $6, the number of items you can buy increased by a multiplication of 1 plus the nominal rate divided by 1 plus the nominal rate. So simply put, if we take 1.031 minus 1, so really the real rate is approximately not 4, not approximately, it's 3.8. So there's a formula to compute the real rate. So to compute the real rate, we're going to take the nominal rate, which happens to be 10% minus 6%, the inflation rate we set 6%, 1 plus 0.6, the inflation rate. And by doing so, we can find basically what it boils down to, basically to find the real rate, this is one way to do it, the nominal minus the inflation, which is 0.04 divided by 1.06. Let's get the calculator and find the formula, 0.04 divided by 1.06. And that's going to give us 3.78 rounding. It's going to give us 3.8 rounding, 3.8%, which is what we thought it was when we said, so that's 10 minus 6, it's 4, that was the approximate rate, but the real rate is 3.8. So this is the formula. So let's assume if the interest rate on a year CD is 8%, this is the nominal and you expect inflation to be 5% in the coming year. How do you compute the real rate? Well, I'm going to take the nominal rate 0.05, subtract inflation 0.08 minus 0.05, then divide this by 1 plus the inflation 0.05. So if I compute this formula, I should come up with 2.86%. Now on the exam, 8 minus 5, it should be around 3%. So 2.86 is close to 2.3%, is approximately close to 2.86. So if you have to approximate, at least you should know, it's a little bit less than 3%. Okay, so this is the answer. Irvin Fischer is an economist. Irvin Fischer argued that the nominal rate ought to increase 1.41 with the increase in inflation. Such an increase would be needed to preserve the investor's real rate of return. So what does that mean? It means the nominal rate should increase in parallel with inflation. If inflation goes up, your nominal rate goes up. So using expected inflation to donate the current expected inflation over the coming period, the Fischer, basically the Fischer formula is the nominal rate should equal to the real rate plus some rate of inflation. So suppose the real rate of interest rate is 2% and the expected inflation rate is 4%, the nominal rate is 6%. This is basically the Fischer formula. So if the expected inflation rises to 5, if this becomes 5, now you need to quote me 7%. So the nominal rate should approximately be 7%. So the increase in the nominal rate offsets the increase in the expected inflation, given the investor an unchanged growth rate of purchasing power of 2%. So you still maintain your 2% purchasing power as long as inflation goes up, the bank will give you more money and the nominal rate will go up as well. Suppose the real interest rate is 3% per year and the expected inflation is 8%. Can you find the nominal rate? Now we know the real rate. So basically the formula is real equal to nominal minus inflation divided by 1 plus inflation. So let's fill in the formula 3%, this is the rate 3% equal to n is the nominal, which is we don't know minus 0.08 divided by 1 plus 0.08. Now if we cross multiply and find n, we'll find out that the nominal rate 11.24. Now again, 3 plus 8 equal to 11, it should be approximately 11, 11.24, this sounds right. Suppose the inflation rate rises to 10%, but the real rate unchanged, what should be the nominal rate? Basically change the 8 to 0.1 and what you will find out, this should go up, it should go up to 13.3%. Again, 10 plus 3, so 10 plus 3 equal to 13, it should be approximately 13, 13.3%. Now in the US, what is the closest thing to measuring inflation? Basically, one month T-bill, one month T-bill government, is close, it works in tandem close enough to inflation. For example, from 1926 to 1951, the average annual rate of return on the T-bill, which is one month treasury bill, if you lend your money to the government, was 1.04, inflation was 1.68. So simply put, the real T-bill, it was giving you a negative return. So if you put your money with the government, what's happening is the inflation is eaten up your return. Between 1952 to 2016, the T-bill earning on average 4.38 and inflation is 3.51. So here the T-bill is covering your inflation and giving you a real rate of less than 1%. This is all on average. And if we see from this graph, interest rate and inflation, T-bills and inflation, T-bills and inflation, you will see that they work hand in hand. Now here we have the depression, obviously they did not work hand in hand. And here we have World War II. Also it's a special time. Otherwise, they go notice hand in hand together. So T-bill is close enough to inflation. That's the point. Now why is this important? We'll see later on that the T-bill is going to represent for us a risk-free measure. Risk-free measure. We'll talk about this in the next, well, starting in the next few sessions. But it's very important to know how the T-bill and inflation rate works hand in hand. In the next session, we're going to start an important topic and that's risk and risk premium. How to measure risk and how to measure risk premium. As always, I'm going to remind you to like my recording, share it, put it in playlist. And I am going to ask you to visit my website forhatlectures.com to compliment to compliment and supplement your accounting and finance education. Study hard and stay safe.