Fireside Chat: Rep. Harriet Hageman | Caitlin Long - Custodia Bank, Harriet Hageman

All right, guys. What an amazing day full of panels. I just want to thank you all for, you know, being here. I would like to remind you all that we will have Feast Sullivan out at 5:00 p.m.

doing an amazing DJ set. But for now, I want you guys to stick around for this fireside chat by Representative Harriet Hegman as well as the moderator Caitlyn Long. Please give it up for them guys.

Thank you. Thank you. Thanks everyone. All right, I think we're pretty close to the wrap-up of another ETH Denver, the ninth ETH Denver. And I'm really thrilled to have Harriet Hegman, who is Wyoming's Congresswoman and will almost certainly be Wyoming's next US senator, stepping into some very big shoes for Senator Lumis, who announced earlier this year that she's retiring.

and we'll we will miss her. Uh but I am thrilled to have Representative Hegelman here to talk about how she can pick up the legacy of Senator Lumis in DC for what Wyoming has done. And and uh for those who don't know, John Per has helped our event in Wyoming at the University of Wyoming. We've kind of worked together the whole time and uh we're we're at number nine this year. So he started ETH Denver a year before we started our event up in Wyoming.

So there's a deep connection. But Representative Hegamman, tell us your background in land use and energy use because this industry cares a lot about the energy industry. So Caitlyn, uh it's wonderful to be on the stage with you today and to be at this event. These are exciting things that are happening in this in this industry and and the related industries right now. You've definitely been at the forefront of this.

I've learned from you over the years and I'm very proud to continue to work with you. I am a water and natural resource and constitutional attorney, but a lot of the work that I have done is dealing with private property rights, uh dealing with federal issues and uh the energy side of things, working for oil and gas companies, and then also as Wyoming's loan representative in the House of Representatives. Clearly, I deal with energy issues all the time. And yes, this is an incredibly important issue for AI, for the future of this technology, uh because we've got to have sufficient energy to be able to power the what we need in order to tap into the resources and and uh uh power this industry. And Wyoming has a pretty big data center industry because of our proximity to bandwidth, which we don't care that much about in in this industry per se.

Although as crypto and AI start to merge and converge with aentic payments, I think we will care about bandwidth and lat low latency a lot more. but talk a little bit about what Wyoming can do in bringing behind the meter energy to help power our needs. And I think that that's why you probably focused on being from Wyoming, but also focused on Wyoming, recognizing that we're one of the top energy producers in the entire nation. We are the top coal producer in the nation. Um we roughly about 250 million tons a year.

The next state is West Virginia. They're at about 125 million tons. So we're double what the next state produces. We're one of the largest oil and gas producers in the nation. And we're also right now we are the largest in terms of uranium.

So we have nuclear energy as you know. We have the new natrium site that we're building over near Kimmer in western Wyoming. Uh really being at the forefront of the the next generation of nuclear energy and Wyoming. Um we're cool which helps. I know that that makes a difference for for data centers, but we also have the access to the grid.

And I do believe that our leaders in Wyoming have been pretty effective at trying to predict the future and understand what our uh our energy demands are going to uh be and trying to meet those. And then I also love the idea. I have worked with reas rural electric associations for years because I also used to do a lot of a work representing farmers and ranchers and ir in the irrigation context and that can also be an energyintensive industry because of the center pivots. So we've always had somewhat of a challenge of providing affordable energy to our farmers and ranchers and other small businesses. Bringing AI uh the data centers in.

Bringing AI in, I think is going to allow us to actually shore up our reas to be able to do additional work on their infrastructure to bring us into the next century to make sure that we have access to these resources into the long-distant future. So, let's talk about nuclear because there are definitely people working to put nuclear power in Wyoming, which is the least it's it's the most sparsely populated state when you look at the per uh you know per acre um of of people. And so that's a place where naturally there would be a desire on the part of some folks to to put the nuclear plants. What have you been doing to speed up um permitting to try to bring even more power production into Wyoming?

Well, there's a couple of different things. President Trump signed an executive order in May of last year titled reinvigorating the nuclear industrial base to jumpstart America's nuclear energy industrial base in new in November. And this is something that I'd advocated for for quite some time. Uranium was reinstated to the federal list of critical minerals. It had previously been on the list, but it was taken off by the by the prior administration.

Um, we used to source about one half of our uranium from Russia and Russian allies with uh but in 2024 we banned the import of of uranium from Russia, which really fundamentally changes the game in terms of being able to access the resources that we need. But Wyoming has been America's top uranium producer for at least 15 years now. and five of the nation's six uranium production facilities last quarter are in the state of Wyoming. Um, one of the things that we've been doing and working on, especially within the natural resource committee, which is the committee that I am a member of, is permitting reform across the board, whether it is uh building out more in terms of our grid or providing access uh to the other uh infrastructure that we need to advance into the next century. We're doing permitting reforms so that AI uh that our that our various industries, our data centers are able to construct more quickly while at the same time protecting our environment and our communities, but to streamline the permitting on a federal level, especially with a state like Wyoming or even Colorado where we have a lot of federal lands and have to cross federal lands with our infrastructure, speeding up that infrastru the permitting so that we can get that done on a timely basis.

And one last topic on energy because I know that you're so passionate about that topic. There are a lot of folks worried with AI about affordability and the impact on retail power prices and the utility bills that all of us pay. Uh what's where where's the balancing act?

So I think that that's absolutely a legitimate concern and one that has been brought to me by quite a few different industry groups. They're afraid of the competition that is going to be created because obviously with these data centers, you're potentially bringing substantial monetary resources into these communities who could out essentially outbid anybody else. And that's why I think and why I mentioned the reas a moment ago is that I think that this is something where by being innovative by thinking outside the box by thinking about ways in which to marry the the data centers with the needs of the communities we can actually help our local rural electric companies our reas and even uh um the uh black gills in Cheyenne Wyoming to build out what they need to by having the data centers fund that because they do have the financial resources to do so. So again, I'm hoping through various partnerships, we'll actually be able to improve the grid, improve the availability of affordable energy without impacting our traditional industries. Let's pivot now and talk a little bit about privacy.

You've been an outspoken critic of central bank digital currencies, which is a topic that everybody in this room cares about. Uh, and privacy is is a topic that most of us care about. There have been um a number of especially under the prior regime um court cases against software developers who wrote code and uh and and um the financial surveillance state has been cranked up. How when you get to the Senate are you going to work on blocking the the more overreach on that? So, one of the areas that I've worked on in the constitutional space relates to both freedom of freedom of speech as well as privacy.

And I think that those are not necessarily two sides to the same coin, but they're definitely related to each other. And I think over the last several years, I've been extremely troubled. Um, and we did a lot of work on this in the judiciary committee, looking at ways in which our government has been spying on us. We've all heard about the Twitter files. we have and not only spying upon us but also then attempting to block us from being able to communicate.

And I'm pretty much a first amendment absolutist. The first amendment says what it says. We have freedom of speech. The government doesn't get to dictate what we say, how we say it, true or not. That there is in my book, there isn't the this concept of misinformation or disinformation.

It is the marketplace of ideas that will far that out so that we can learn what is true and what is not true. So there's a couple of things that I have looked at in this space and in the freedom of speech area. Um right now it is very difficult to be able to sue the federal government for violating one of our five tenants of the first amendment. Freedom of speech, freedom of religion to uh peaceibly assemble, petition our government for redress and the press. And so I have uh I I have introduced the first amendment accountability act.

And what that would do is it would allow individuals to sue the federal government if they violate one of your First Amendment rights. You could get monetary damages and injunction and attorney's fees. And I think that that makes this effort at censorship much higher risk for the federal government. So there's accountability there. The other side of that, and I think it's something that needs to be discussed in your industry, and you know a lot more about this than I do, but the idea of sunsets on some of the legislation that we pass.

And I say that because um and I'll give you another example of where I believe that our federal government definitely overreached section uh section um the FISA court. You probably all heard about the FISA court several years ago. We know that that the the the administration was was uh spying on the Trump candidacy before he was elected in 2016. And under FISA, the there was a lot of abuse. The FBI and other federal agencies were spying on American citizens.

So the fortunate thing is is that FISA had a sunset clause that we had to either reauthorize it after 5 years or it would go away entirely. So two years ago through the judiciary committee, we did substantial reform of section 702 of FISA to make it much more difficult for our government to spy on us. And then we put a two-year sunset on it so that we have to take this back up in March. What that does is it makes sure that we can control and keep the government in check in terms of their abuse of power against the American citizens. I bring that up in part because of the topic we're talking about, but also because in the technology arena, in what you are doing, things are moving at the speed of light right now.

I mean, the the technological advances and changes are moving at the speed of light. I don't know what the lay of the land is going to be 5 years from now. I'm very uncomfortable with us adopting legislation on a particular issue related to um you know buying and selling or whatever the particular topic might be hardwiring that in as technology changes making it very difficult for us to come back in and fix it. If we put sunsets on our technology type of legislation, it allows us to work with the industry on a very robust way to make sure that we are not creating problems for your industry, stifling innovation, preventing you from advancing at the same time that we're making sure that we're that we are an active partner and we're limiting the overreach of administrative agencies. Yeah, we had a robust conversation after lunch this uh today about the sun setting issue in this industry.

Obviously, we've we've watched government power be weaponized against us uh at at the SEC um against software developers and projects in this space who tried to figure out how to comply with the law and literally couldn't. Uh and then so many of us lost our bank accounts just simply for being involved in this industry or you know transferring money from a crypto exchange back to their bank account. Uh and so one of the problems with I mean we just got one piece of legislation through right we got the uh got got the stablecoin bill through and now the clarity act is is on tap. Um and and our concern of course would be that in in a if if the Elizabeth Warren of the wing of the Democratic party gets control again, they'll just reverse it all. So, uh that's one of the hard parts about the the hard one gains that we've had under the Trump administration is that we're trying very hard to get them through Congress so that they're that they're durable.

uh how how do you weigh the balance of having to if you were to put a two-year sunset or a five-year sunset on the Genius Act or the Clarity Act uh if Congress had to reopen all of that again in a few years because your industry builds up and has create has created its own ecos. I guess you'd say you th this industry is too important for everybody to say, "Well, four years from now, we have a sunset on a a particular piece of legislation and therefore we're just simply going to let it go by the wayside." The pressure is too intense for that to happen. Even with section 702 of FISA, which I voted against and I voted against it because even with the changes we made, I still had concerns about some of the privacy issues under the Fourth Amendment to the United States Constitution. That doesn't mean that I don't think that we made some huge advancements and it ultimately passed and and and it was probably a good thing that it did, but there was a lot of pressure to bear on passing it.

We brought the pre the pressure to bear to reform it. And I think that if you've got people who are working in good faith and recognize the significance and importance of the industry, there is going to be the momentum to make the changes. And the reason I say this is because I know and you and I have talked about this before, as this industry has has grown up and become an adult, um there has been an effort by some to try to to force you into a paradigm that doesn't make sense. Well, we look at the the the statutes from the 1930s. We look at the statutes from the 1980s.

Well, none of this existed in the 30s and the 80s. How do we retrofit laws for the for securities for controlling or or overseeing securities or banking from 80 years ago or from 50 years ago for something that is entirely constructed differently. So, we're all walking into this together trying to figure out how to create a framework that that protects the consumers, protects our economy, protects your businesses, protects each of you individually at the same time that we don't stifle innovation. And that's why I think from the standpoint of having sunsets, it still gives us the opportunity to revisit what we need to, but work with the experts in the field because I'm not an expert. I'm I'm not that person.

I'm not that man. I'm I'm the I'm a water and natural resource attorney. I'm a constitutional attorney. I'm a member of Congress. I don't know what you know.

I need you to help me to to do to to learn that. But that is also in part how we draft the legislation together. Well, thank you. You definitely you can hear the passion for the for the first amendment and the fourth amendment in what you just talked about because of your constitutional uh background. And I think there would be a lot of support from this community for you on those issues.

We've watched our fellow friends and um and and frankly software developers go to jail for writing code that somebody else used to commit a crime. And uh Wyoming exempts that. It's it protects software as speech. There's a a law that got passed in the Wyoming legislature in 2019, I think, that protects software developers from being criminally prosecuted. If someone else uses your code to to commit a crime, uh, and there are exceptions, of course, for if if the software developer wrote the code maliciously, then of course they can be uh they can be prosecuted.

But um the the the overreach that we've faced in this industry is stunning. Let's close by the conversation that you and I just had about how the your idea of putting sunsets in legislation will take power away from the administrative state which has morphed its power so often to to to grab jurisdiction that Congress never intended it to give. So that's probably the other aspect of what I did for several decades as a as a regulatory attorney, a constitutional attorney, was looking at the ways in which regulatory agencies exceeded their authority and exceeded their statutory authorization simply by reinterpreting or reapplying or uh deciding something different than what the statute said or or applying a particular statute in a unique uh way. What happens with sunsets is to the extent that we then go back in and we change that law, whatever regulations have been created based upon the previous statute such as section 702 of FISA, those regulations will no longer have any force in effect because they don't have a legal statutory foundation for them. So that's what's also important is it forces Congress to do its job of being the legislative branch, making sure that we are consistently revisiting the issues that are important to our citizens and our constituency.

Well, thank you. We're out of time. You see why I have endorsed Representative Hegman for the the Senate seat. Uh I think she'll be a a good advocate for our industry, for the foundational issues that we really care about once she gets into the Senate. So welcome.

Thank you very much for coming to ETH Denver. Thank you. Thank you. Thank you.