G8 2009 Italy Report by The Group of Nations

Summit 2009

Welcome Message from the President of L’Aquila

Russian Standard

Sono davvero orgogliosa e onorata, come presidente della Provincia dell’Aquila, di poter ospitare nel capoluogo di regione un evento di così grande importanza, come il G8. La scelta di individuare L’Aquila, colpita dal terremoto dello scorso 6 aprile, sede del Summit mondiale, a cui partecipano i Grandi della Terra, è indubbiamente un segnale d’attenzione forte per il nostro territorio. Un’opportunità per continuare a tenere accesi i riflettori su una provincia devastata dal sisma, che tuttavia ha tanta voglia di ripartire, di ricostruire, a cominciare dal tessuto produttivo, economico e sociale. Una provincia che ha anche tanto da offrire, in termini di competenze, di professionalità, di cultura, di know how e di meraviglie naturali e paesaggistiche. Siamo da sempre e continueremo ad esserlo la provincia dell’innovazione e dell’accoglienza. Il nostro territorio vanta la presenza di centri di formazione e di ricerca di fama internazionale, di imprese d’eccellenza nei settori delle telecomunicazioni, del farmaceutico, dell’elettronica, di un tessuto dinamico di piccole e medie imprese, di un polo universitario che continua ad essere punta di diamante del centro Italia. Il terremoto ha distrutto le case, le sedi della scienza e della cultura, ma non le nostre menti, le nostre professionalità, non le nostre competenze. Il sisma non ha intaccato le meraviglie naturali, paesaggistiche, storiche, i parchi, le montagne i borghi antichi, le tradizioni secolari e l’ospitalità della nostra gente. Il sisma non ha fatto crollare il know how, che il territorio è sempre stato in grado di offrire e che sapremo mettere al servizio dei grandi temi, su cui si confronteranno i leader di tutto il mondo a L’Aquila. Sviluppo eco-sostenibile, politica energetica intesa come promozione di fonti rinnovabili e tecniche di risparmio; istruzione, cultura, lavoro, tutela dell’ambiente, sicurezza alimentare… Saranno queste le scelte da compiere per il futuro. Questi i nodi che il Summit è chiamato a sciogliere. Sono gli stessi temi che ci hanno appassionato da sempre, temi su cui l’Ente e il territorio che rappresento hanno saputo svolgere un ruolo trainante. Per questo ritengo che il G8 sia una grande opportunità per la nostra provincia. Ai grandi della terra, a cui do’ il benvenuto e auguro un buon lavoro, chiederemo di aiutarci nella ricostruzione, di rimettere in piedi le strutture che il sisma ha devastato, affinché il grande patrimonio che abbiamo costruito negli anni non vada disperso. Stefania Pezzopane Presidente della Provincia dell’Aquila

Summit 2009

Welcome Message from the President of L’Aquila

Forbes

It is a great honor and a pleasure for me, as the President of the Province of L’Aquila, to host in the capital of the Abruzzo region the G8 Summit. The choice of L’Aquila, so hard-hit by the earthquake of last April 6th, as the venue of the summit, is undoubtedly a clear sign of attention towards our territory. This occasion represents to us the opportunity to keep on having the spotlight of the media on our province, so deeply devastated by the quake, yet still strongly committed to restore itself and to rebuild its economic, social, and productive fabric. Our province has indeed much to offer in terms of culture, nature, know how, and skills. We have been so far, and we still want to be, the province of innovation and hospitality. Our territory boasts the presence of research and education centers internationally acclaimed, outstanding telecommunication, pharmaceutical, and electronic companies, a dynamic fabric of small and mid-sized firms, a renowned university which must continue to be our flagship. Our houses, our art, culture, and science venues have been destroyed by the earthquake, but not our minds or our passion. Still alive is our history, our natural beauties, our unique landscapes, mountains, parks, ancient villages, our centenary tradition, and our people’s great hospitality. The quake did not destroy our skills and our local competencies, which our territory has offered so far and which we want to put on to service of the great issues that the leaders of the world will debate in L’Aquila. Sustainable development, energy policy meant as encouragement of renewable and more efficient power source, education, culture, jobs, environmental conservation, and food security. These are the pressing issues the summit is asked to tackle. These are the challenge and the choices for the future. These are crucial themes in which our administration has showed its committment since its establishment. For those reasons I believe that the G8 summit will represent a unique opportunity to our province. We therefore ask the world leaders, to whom we are proud to offer our warm-hearted welcome and our wishes of a profitable meeting, to help us in the reconstruction, to restore all the structures the earthquake has destroyed, to give new life to the great heritage that our territory built through the years. This is our greatest hope, our utmost goal.

Stefania Pezzopane President of the Province of L’Aquila

Summit 2009

Welcome Message from the Director General of L’Aquila

Il summit dei rappresentanti degli otto paesi maggiormente industrializzati del mondo, in programma a l’Aquila dall’8 al 10 luglio prossimi, rappresenta una grande occasione di rilancio dell’economia mondiale in un momento di crisi che perdura da diverso tempo. L’incontro ha grande risalto per essere il primo cui partecipa il nuovo presidente degli Stati Uniti Barack Obama, che con la sua politica riformista ha dato avvio ad un nuovo corso di apertura dell’amministrazione americana alle problematiche socio-economiche di tutto il mondo, ridando così nuova forza e fiducia all’immagine degli Stati Uniti. Per essere il G8 il luogo in cui si discutono gli scenari futuri di tutto il globo dal punto di vista politico economico e sociale, si può comprendere che la scelta dell’Aquila come sede, soprattutto dopo il sisma del 6 aprile, è occasione imperdibile per porre all’attenzione dei grandi della terra la ricostruzione di questo territorio, delle bellezze artistico-ambientali e del tessuto economico sociale, costituito da una moltitudine di imprese e da numerosi uffici pubblici, statali, regionali, provinciali comunali e da un’importante Università che erogano ai cittadini servizi essenziali e che pertanto devono tornare ad operare efficacemente ed in breve tempo per ripristinare condizioni di vita normali. Tutta la struttura tecnica della Provincia dell’Aquila saluta gli organizzatori ed i partecipanti a questo grande evento rivolgendo i migliori auguri di un proficuo lavoro. Dott. Giovanni Di Pangrazio Il Direttore Generale Provincia dell’Aquila

The summit of the eight most industrialized countries in the world, organized in L’Aquila from July 8 to 10, 2009, represents a big occasion for world economy revival during a crisis period that continues for long time. The meeting has great importance because it is the first with American President Barack Obama, who, with his reform policy, has started a new era of opening the U.S. to the world’s socio-economic problems, giving a new power and trust to the U.S. image. After the earthquake of April 6th, 2009, the choice of L’Aquila as the seat of G8, where the members debate about the world’s political, economic, and social issues, is a considerable occasion to direct the attention of the world powers to reconstructing this land and preserving its artistic and environmental beauties, and the economic and social area made by a lot of enterprises and public national, regional, and local offices, and an important University, that deliver essential services to citizens and therefore they must return to work effectively and as soon as possible to restore normal life conditions. The entire infrastructure of the Province of l’Aquila greets the members and organizers of this great event and sends best wishes for successful work in the meeting. Dott. Giovanni Di Pangrazio General Director Province of l’Aquila

Summit 2009

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Publisher’s Note Publisher The CAT Company Inc G8 summit Magazine Company Ltd The CAT Company Inc President Chris Atkins

Chris Atkins

Dear G8 Summit Readers, I would like to take this opportunity to thank all those involved for their dedication in helping to make this a successful publication especially Ana Rold from the Diplomatic Courier and Kirk Jowers Director of the Hinckley Institute of Politics. The CAT Company is the only publishing company that has been involved with the past thirteen G8 Summits and is continuing to get great recognition as its foremost publisher, including being awarded the status of “exclusive” publication for many of the past G8 Summits. As the publisher of the award winning G8 Summit magazine and in keeping with one of this year’s themes, environmental sustainability, the CAT Company is doing its part for the environment by proudly offering this publication in E-book format, brought to you by E-OCTAVO, a subsidiary of the CAT Company. The E-book version of this magazine will reach 19 million companies across Europe and the United States of America, with the help from the Euro Chambers and our link on Forbes.com. If you would like to visit and peruse this magazine online, please visit: www.thecatcompanyinc.com I hope you enjoy our magazine and we will see you in Canada for 2010. Yours Sincerely

Advisory Board Peter Atkins Chris Atkins Jennifer Latchman William Zimmer Graphic Design and Art direction President Henri de Baritault Head of Sales Mark R Marshall Sales Executives Chris Atkins John Armeni Peter Scott Ralph Windsor Veronique Madsen International Sales office Japan Sun Monde Inc Eriya Unten Seiko Ogushi Takashi Fukunaga Kunio Toma Takeshi Noguchi Hinckley Institute of Politics- University of Utah Director Kirk Jowers Intern Manager Courtney McBeth S.J. Quinney Law School – University of Utah Dean and Professor Hiram Chodosh Director of external Relations Barry Scholl Special Thanks To Diplomatic Courier Hinckley Institute of Politics S.J. Quinney Law School Verso Paper DHL Hudson Printing CRI Intro 60 Roll Call Provincia L’Aquila Stefania Pezzopane Presidente della Provincia dell ‘Aquila Il Direttore Generale Provincia dell’ Aquila – Dott. Giovanni Di Pangrazio

Chris Atkins Publisher and Founder, CAT Company Inc.

Summit 2009

EDITORIAL EXECUTIVE EDITORS Ana Carcani Rold Kirk L. Jowers Barry Scholl Courtney H. McBeth

CONTRIBUTORS Tyler Anderson, Hinckley Institute of Politics, University of Utah Dr. Raymond Baker, Global Financial Integrity John Bavoso, Diplomatic Courier Magazine Michelle Bernard, Independent Womenâ&#x20AC;&#x2122;s Forum Ambassador John Bruton, EU Delegation to the U.S. Hiram E. Chodosh, University of Utah S.J. Quinney College of Law Lincoln Davies, University of Utah S.J. Quinney College of Law Brian J. Forest, Diplomatic Courier Magazine Dustin Gardiner, Hinckley Institute of Politics, University of Utah Erika George, University of Utah S.J. Quinney College of Law Amos N. Guiora, University of Utah S.J. Quinney College of Law Ryan Harding, Diplomatic Courier Magazine Andrew Jensen, Hinckley Institute of Politics, University of Utah Christian Johnson, University of Utah S.J. Quinney College of Law Dr. Joseph S. Joseph, University of Cyprus C.S. Eliot Kang, Bureau of International Security and Nonproliferation, U.S. Department of State Minister Hala Lattouf, Jordanâ&#x20AC;&#x2122;s Ministry of Social Development Secretary Michael O. Leavitt, U.S. Department of Health and Human Services Chibli Mallat, University of Utah S.J. Quinney College of Law Christopher Peterson, University of Utah S.J. Quinney College of Law Dr. Maria Rost Rublee, University of Auckland Rami Turayhi, Diplomatic Courier Magazine Joseph M. Vandette, Jr., Hinckley Institute of Politics, University of Utah Chris Whytock, University of Utah S.J. Quinney College of Law

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Summit 2009

Table of Contents Welcome Message from the President of L’Aquila, italian 4 Welcome Message from the President of L’Aquila, english 6 Welcome Message from the Director General of L’Aquila 8 Publisher’s note By Chris Atkins 10 EDITORIAL 12 EDITORS’ NOTE - Return of the Summits By Ana Carcani Rold and Kirk L. Jowers , Executive Editors 21 All Roads Lead to Rome By Brian J. Forest, Correspondent – Diplomatic Courier Magazine 28 Addressing the Global Shadow Financial System By Raymond Baker – Director of Global Financial Integrity (GFI) 30 Global Economic Crisis and EU’s Response to Protectionism By Ambassador John Bruton – Ambassador of the Delegation of the European Commission to the United States 32 Bank Capital and the Credit Crisis By Christian Johnson, Professor of Law, University of Utah S.J. Quinney College of Law 34 Can Sovereign Wealth Funds Be the Unlikely Saviors of Renewable Energy? By Rami Turayhi, Senior Contributor – Diplomatic Courier Magazine 38 Drafting a Carbon Emission Regulation System for the U.S: Insight Provided by a Carbon Tax By Joseph Vandette, Hinckley Scholar, University of Utah Hinckley Institute of Politics 42 Finding Security in Climate Change By Lincoln Davies, Associate Professor of Law, University of Utah S.J. Quinney College of Law 46 The G-8 Global Partnership By Dr. C.S. Eliot Kang, ISN Acting Assistant Secretary – U.S. Department of State 48 The Most Dangerous Threat By David Irvine, Retired Brigadier General – U.S. Army 50 Encouraging Nuclear Nonproliferation & Disarmament: Lessons from Social Psychology By Dr. Maria Rost Rublee – University of Auckland 52 On Combating Global Terrorism By Ryan Harding, Correspondent - Diplomatic Courier Magazine 54 Democracy Promotion: Productive Long-term Strategy, Not Counterterrorism Answer By Andrew Jensen, Hinckley Scholar, University of Utah Hinckley Institute of Politics 56 China’s Investment in Africa: Development or Neo-Colonialism? By John Bavoso, Correspondent – Diplomatic Courier Magazine 58

A Prescription for Development: Curing What Ails Foreign Aid to Africa By Erika George, Professor, of Law, University of Utah S.J. Quinney College Of Law 60 Mugabe’s Zimbabwe: A State’s Decline from Fragile Democracy to Electoral Authoritarianism By Dustin Gardiner, Hinckley Scholar, University of Utah, Hinckley Institute of Politics 64 European Union Enlargement and the Islamic Challenge By Dr. Joseph S. Joseph, Jean Monnet Chair in European Foreign Policy and Security Policy, University of Cyprus 66 Between the Justice of Islam and the Injustice of Tradition By the Honorable Hala Bsaisu Lattouf, Minister of Social Development, Hashemite Kingdom of Jordan 70 Pakistan, Afghanistan, India: Report on the State of Conflict By Amos N. Guiora, Professor of Law, University of Utah S.J. Quinney College of Law 72 From Zero-sum Conflicts to Federalism: The Road Forward By Hiram E. Chodosh, Dean and Professor, and Chibli Mallat, Professor, S.J. Quinney College of Law 74 An International Agenda at a Time of Crisis By Michelle Bernard, President and CEO Independent Women’s Forum and MSNBC Political Analyst 76 Mercantilism or Meeting Demand? China’s National Oil Companies and Multilateral Diplomacy By Tyler Anderson, Hinckley Scholar, University of Utah Hinckley Institute of Politics 80 Harmful Transnational Activity: Principles for Coordinated Domestic Legal Responses By Chris Whytock, Associate Professor, University of Utah S.J. College of Law 82 Foreclosing on American Leadership By Christopher Peterson, Professor, University of Utah S.J. Quinney College of Law 84 Pandemic Flu: Preparedness in a Changing World By Secretary Michael O. Leavitt – Former Governor of Utah, Administrator of Environmental Protection Agency, and Secretary of the U.S. Department of Health and Human Services 86 Interview with His Excellency Klaus Scharioth of Germany 88 Interview with His Excellency Pierre Vimont of France 90 Interview with His Excellency Ichiro Fujisaki of Japan 94

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Summit 2009

EDITORS’ NOTE Return of the Summits By Ana Carcani Rold and Kirk L. Jowers Executive Editors

When assessing the year 2009, historians will undoubtedly dub this the year of the return of grand summits. The G20, the NATO 60th Anniversary Summit, the 5th Summit of the Americas, and the culmination of all summits: the G8, hosted this year by the rotating presidency of the Republic of Italy. All of them were grand in their own respects and the issues they sought to tackle, even bigger. 2009 may also be remembered as the year all countries turned to multilateralism and unilateralism both at the same time. How is it possible? The challenges of the global financial crisis called for unilateral protectionist measures by most countries in the world. Naturally, when the economy is tough, nations will look to protect their own workforces and markets. At the same time, the scope of the financial crisis is global and interconnected. It demands for a bigger and more inclusive group of nations to work out their problems multilaterally. Thus the G20 became the biggest and most important gathering this past spring, even overshadowing, for that moment, the G8. Yet the G8 is itself becoming more inclusive, both in agenda and in membership. Historically, the G8 was one of the most exclusive clubs in the world of grand summits. However, since the first meeting took place in 1975 at the Château de Rambouillet, just outside Paris, much has changed. At the time, the G6 of the major industrialized democracies gathered to informally discuss the economic crisis plaguing the world in the early seventies. It may feel as though not much has changed since then. Indeed, the G8 still gets together every year to discuss mainly economic matters, but the gathering has become more formal and much more important, and the agenda has become steadily more ambitious. This year, besides the economic crisis, the G8 will be tackling four other significant issues affecting nations globally: non-proliferation and terrorism, climate change and energy security, regional crises such as Pakistan and Afghanistan, and development in Africa. These are the five priorities that the Italian presidency put forward but recent and upcoming events may yet force themselves on to the G8’s crowded lineup. A renewed discussion on a new form of world governance, based on an enhanced and structured form of dialogue with the major emerging economies has also been the focal point of the Italian presidency for this year’s G8 Summit. Coupled with the invitation of the BRIC countries and several other regional representatives from around the world at this year’s G8 meeting testifies to the fact that the culmination of this year’s grand summits will be a striking balance in which the G20 and the G8 will meet somewhere in the middle to better represent the world’s economies and challenges toward a better future. What will be the future of the G8? Will it be the G13 the next time around? Perhaps. As it stands, the summit of all summits is already including more observer nations at the table. And perhaps the G8 will move completely away from the informal discussions of yester years to an official assembly befitting the world order of today. Until then, however, we will undoubtedly remember this year’s G8 Summit as the one that changed the course of history of all subsequent summits.

Ana Carcani Rold

Kirk L. Jowers

Executive Editors

Summit 2009

All Roads Lead to Rome By Brian J. Forest, Correspondent – Diplomatic Courier Magazine

As President Barack Obama seeks to improve ties with Russia and Iran, he may find an ally in Italy’s Prime Minister, Silvio Berlusconi. Italy has a distinctive reputation in Europe for forging close ties with the United States as well as the nations with which it has had the rockiest relations—namely Iran and Russia. Berlusconi was one of former President George W. Bush’s strongest allies throughout his presidency, contributing troops to the missions in Afghanistan and Iraq against strong opposition at home. He was one of the few world leaders Bush invited to give a joint speech before the U.S. Congress, addressing the body in 2006. With Bush back at his ranch in Texas and a new administration in power in the U.S., Italy is now seeking to serve as a conduit between the United States and some of its most cantankerous adversaries. President Obama has openly talked of thawing relations with Iran’s hard-line leadership and declared, “If countries like Iran are willing to unclench their fists, they will find an extended hand from us.” He spoke of a “new beginning” in a video message distributed to Iranian news agencies in March, offering, “The United States wants the Islamic Republic of Iran to take its rightful place in the community of nations.” Yet, the Obama administration has so far seen its limited outreach to the Islamic republic rebuffed. President Mahmoud Ahmadinejad and Supreme Leader Ayatollah Khamenei have openly criticized the new administration. Secretary of State Hillary Clinton’s claim of a dialogue between her envoy and Iran’s deputy foreign minister at a summit in March was met with a “categorical” denial from the foreign ministry. Improving relations with Russia—which grew cool under the Bush presidency—has also proven challenging. Disputes over pro-democracy movements in Ukraine and Georgia, Kosovo’s independence, human rights, and the war in Iraq led to a steady decline in relations between the two countries during the Bush years. While the Obama administration has received a more positive reception in Moscow than its predecessor, Russian leaders have not forgotten candidate Obama’s criticism over the conflict in Georgia, or his implicit threat to block Russia’s bid to join the WTO.

Summit 2009

Italy’s U.S. Ambassador, Giovanni Castellaneta, has recently been promoting his nation’s “special relationship” with Russia and has spoken of the need to include additional participants in nuclear talks with Iran— presumably his own country.

Cover Story Referring to the talks between Iran and the P5— U.S., Britain, France, Russia, China—and Germany, Castellaneta told the Washington Times, “The ‘P5 plus 1’ approach didn’t give us the results we hoped for.” He suggested adding additional countries to the negotiations, including, “Japan, India, even the (Persian) Gulf states and Canada.” Castellaneta served as Italy’s ambassador to Iran from 1992-1995. Italy has long had unique ties with Iran, dating back to Marco Polo’s treks through Persian lands on his way to China. Today, Italy is Iran’s largest European trading partner and the two countries have more than doubled their volume of bilateral trade over the past five years. Berlusconi offered to help President Bush solve the Iran nuclear issue on a farewell visit to Rome in 2008, offering to share his country’s knowledge of the Islamic republic “from the inside” if it would help resolve the dispute. With Italy in charge of the rotating G8 presidency this year, Italian Foreign Minister Franco Frattini has also invited his Iranian counterpart to take part in a June G8 summit on Afghanistan. ANSA news agency quoted Frattini as saying, “Iran could play a positive role and with the Americans we are discussing how to involve them, not whether to involve them.” He added, “America wants us to talk with Iran because Italy is in a position to speak with Tehran.” Berlusconi has also forged close commercial and political ties with Russia, and is known to have a deep personal friendship with Prime Minister Vladimir Putin. He was one of the only pro-U.S. European leaders to refrain from criticizing Russia over its military actions in Georgia. Berlusconi has also publicly called for Russian entry in the European Union, telling Italian reporters that he considers Russia, “to be a western nation.” As part of its G8 presidency, Italy hosted a conference titled “Overcoming Nuclear Dangers” in April. At the conference, former U.S. secretaries of state conferred with Mikhail Gorbachev and Franco Frattini on global nuclear challenges, including Iran. April’s conference followed an agreement between Barack Obama and Russian President Dmitri Medvedev to begin work on an arms reduction treaty. Frattini applauded the accord as “very important in reviving U.S.-Russian relations,” and American and Russian diplomats have been working out the details of the agreement in Rome. Brian J. Forest is a Senior Correspondent for the Diplomatic Courier magazine where he covers global elections, Japan, and Canada.

Summit 2009

Addressing the Global Shadow Financial System By Raymond Baker – Director of Global Financial Integrity (GFI)

Global Financial Crisis Global Financial Integrity (GFI) recently completed an analysis of illicit financial flows out of developing countries, utilizing in part the World Bank Residual Method and IMF Direction of Trade Statistics. This is the first study to take these models and apply them to the whole of the developing world. We show that somewhere between $850 billion to more than $1 trillion a year of illicit money passes out of developing countries. Or put another way, for every $1 of aid generously given to developing countries, some $10 of illicit money flows out, passing through the shadow financial system and ultimately into our western economies. This is the most damaging economic condition hurting the global poor. Part of what is so difficult about the current crisis is that no one knows how big it is. We have no idea how much bad paper in the form of subprime mortgages, credit default swaps, and derivatives contracts is hidden away in tax havens and secrecy jurisdictions, in hedge funds and offshore banks and special purpose vehicles. Interbank lending has dried up because one bank does not know the quality of assets in another bank. As a result, other forms of lending have been pulled down as well—corporate, trade, home, consumer, and more. The culture of opacity, so evident in this crisis, driven in good part by the global shadow financial system, has been hurting the developing countries for decades and now has brought this harm home to industrialized economies as well. What can countries do? The goal should be to curtail the flow of tax evading and other illicit money across borders, not to try to stop it. Stopping it would require draconian steps. Substantially curtailing it can be achieved with a few broadly adopted and implemented measures. Some people assert that this is extremely complex and technically difficult. Not correct; it is a matter of political will.

Summit 2009

The G8 has an extraordinary opportunity to begin reshaping the international economy around principles of legitimacy and equity.

that perhaps half of global trade and capital transactions pass through this shadow financial system somewhere between origination and completion.

The outstanding issue that needs to be addressed is the global shadow financial system. Working in unison are tax havens, secrecy jurisdictions, disguised corporations, anonymous trust accounts, fake foundations, transfer pricing arrangements, and money laundering techniques that move cumulatively trillions of dollars of illicit money across borders. This system equally facilitates shifts of the proceeds of bribery and theft by foreign government officials, criminal activity such as drug trading and racketeering, terrorist financing, and commercial tax evasion. Some estimates suggest

These illicit financial flows damage both the developing countries and the industrialized economies of the G8. For developing countries, it drains hard currency reserves, heightens inflation, reduces tax collection, worsens income gaps, cancels investment, hurts competition, and undermines trade. In G8 economies it reduces tax collection, worsens income gaps, and shifts tax burdens off of capital and onto labor. Affecting all countries, it contributes to the culture of opacity that lies at the heart of the current financial crisis.

There are four measures that leaders of the G8 can take now that will substantially curtail the problem. First, exchange of tax information should be automatic rather than by request. G8 leaders should make a commitment to automatic exchange of tax information across borders and place a target date on its implementation. This would signal that we are dead serious about resolving this financial crisis and preventing future such crises. Second, beneficial ownership must be addressed. All financial institutions around the world should be required to know the beneficial owners of entities with which they do business. It is inexcusable in this age of terrorism and crime for any financial institution not

to know with whom it is doing business. A Wall Street banker recently asked, “Do you have any idea how much it would cost us to determine the beneficial owners of all our accounts?” The answer is it costs nothing. Banks should simply require the account holder to tell them who are the flesh and blood owners or the listed company that is the owner of the account, in the absence of which the account is closed. Third, countries cooperating with the Financial Action Task Force in Paris should harmonize predicate offenses under anti-money laundering laws and add to such predicate offenses knowingly handling the proceeds of tax evasion. It is unacceptable that many countries remain open to a wide range of criminal money and equally unacceptable that many countries actively seek the proceeds of commercial tax evasion. Fourth, country-by-country reporting of sales, profits, and taxes paid by multinational corporations should be agreed. Currently, corporations compile this information for internal purposes but do not provide disaggregated data in annual reports. Hence we see tens of billions in stated profits and little or nothing paid in taxes. Countryby-country reporting has a number of very significant advantages, including generating additional tax revenues for countries, accomplished without large regulatory burdens on either governments or businesses. It also reverses the shift over recent decades of tax burdens increasingly onto labor, and in doing so it reverses the growing inequality between rich and poor. There is a grand bargain between democracy and capitalism. Democracy offers to its people an equal measure of political liberty. Capitalism is expected to offer to its people a fair measure of economic opportunity and economic prosperity. Across recent decades, capitalism has not been holding up its end of the grand bargain. It has not been doing a satisfactory job of spreading the benefits of growth and prosperity to all people, either within countries or between countries. As a consequence, the spread of democracy itself has been stagnating since the mid 1990s and indeed slipping backwards in a number of countries. There is now substantial risk that this trend may continue. Within the democratic-capitalist system, it is capitalism that needs to move closer to the ideals of democracy, closer to transparency, equity, and justice. And it is the G8 that needs to lead toward these goals. Raymond W. Baker, Director of Global Financial Integrity, is author of Capitalism’s Achilles Heel: Dirty Money and How to Renew the Free-Market System (John Wiley & Sons, 2005)

Summit 2009

Global Economic Crisis and EU’s Response to Protectionism

Global Financial Crisis

By Ambassador John Bruton – Ambassador of the Delegation of the European Commission to the United States

In every crisis, there are opportunities that might otherwise be postponed. There is no question that we are living in difficult times. The economic crisis is affecting all of us—big countries and small, the wealthy and the not-so-wealthy. Climate change is a reality; the Wilkins Ice Shelf, which is the size of Connecticut, is breaking away from the Antarctic Peninsula. In many cases, these problems could have been averted, or at least mitigated, if we had addressed the underlying causes sooner. But now, the arguments for taking action are more compelling—in fact, we are rapidly running out of choices. The EU—like the United States—has already taken forceful and coordinated steps to end the financial crisis and build a stronger, more sustainable, more stable economy for the future. We were the first to act on credit rating agencies, capital requirements, and deposit guarantees, and we are working together to implement a fiscal stimulus of at least 3.3 percent and up to four percent of GDP in 2009-2010, or more than €400 billion. By dealing with impaired assets in a European framework, we are rebuilding confidence and stimulating lending, and we are supporting industry where necessary while rejecting protectionism and preventing a destructive subsidy race. But we haven’t stopped there. We have also mapped out a route toward sustainable long-term prosperity. By investing in the sectors of the future and in intensifying—not reducing—the fight against climate change, repairing financial markets, and strengthening financial regulation and supervision, we are ensuring stability for ourselves as well as for future generations. The coordinated EU strategy currently being implemented would be a remarkable achievement even for a single national government. For 27 Member States and 500 million people, it is unprecedented. While it is true that circumstances differ widely across the EU as a whole, there is no two-speed Europe or new iron curtain. We all prospered in the good times, and we all are suffering in the bad times, though to different degrees. But because every economy is different, we have adapted our instruments to the different national circumstances.

Summit 2009

The EU has been providing funds to stimulate our individual national economies in accordance with the individual room for fiscal maneuvering that each country

has. We have also, in conjunction with the IMF, been providing funds to assist some EU Member States, as well as some European non-members, who have gotten into particular difficulties. Of course, not everyone always immediately agrees on every detail. Each nation around the world wants to invest in its economy, in its industries and workers, in the way that seems best and most productive in its individual situation. You could even call this “protection” against a volatile economic situation, in the broadest sense of the word. But that is entirely different from protectionism. Open markets deliver huge economic benefits, in terms of both supply and demand—they offer opportunities for our businesses and greater choice for our consumers. But defending open markets is also important politically, because they shape the future of international trade in a way that fosters a more just and prosperous world for all. Retreating to the safety of our own domestic markets would be a huge mistake—it is what tipped recession into depression in the 1930s and what could turn a downturn into our downfall today. The G8 Summit offers us the opportunity not only to continue the worldwide coordination of fiscal stimulus programs and reform of the financial markets, but also to find ways to deliver on our climate change and development goals. The fight against climate change must not be delayed by the economic crisis. By implementing measures to green our economies, we can tackle the two issues simultaneously. The stimulus packages that will get our economies moving again are creating green jobs for our citizens by accelerating investment in building a lower-carbon economy that is vital for beating climate change.

tionately the biggest contribution to fixing the problem. Industrialized countries can and must lead through example, by putting a market price on carbon emissions, by investing in new technologies, and by helping others develop wisely.

As much as the EU is doing to fight climate change, we cannot go it alone. Developed parts of the world, like Europe and the United States, have contributed and continue to contribute disproportionately to climate change. With only 12 percent of the world’s population, the EU and U.S. together account for 40 percent of all global emissions.

We also need to look at how we can best reform the institutions governing the global economy to allow emerging economies to take their rightful place at the table. To truly deliver on our commitment, we need to complete the Doha Round of world trade talks. This agreement would add hundreds of billions of dollars to the world economy every year, and allow the developing world to continue to lift its citizens out of poverty through their own labor and their own ideas.

Since we have played such a major role in creating this global crisis, we must now take the lead in finding a solution. It is only fair that those of us who have already put the most CO2 into the atmosphere make propor-

Doha is also an insurance policy against protectionism. A recent study shows that if tariffs were raised to levels still allowed under current WTO ceilings, global income could be reduced by at least 500 billion dollars.

That’s a large chunk of the fiscal stimulus—gone. This summer’s G8 meeting offers us the opportunity to tackle these issues in a coordinated forum, through what our European Commissioner for External Relations and European Neighborhood Policy Benita FerreroWaldner has called “effective multilateralism.” In reality, multilateralism is the only effective approach, not only for the financial and economic issues which dominate the agenda today, but for all issues which affect the future of our planet. The EU is determined to play our part in encouraging open and positive debate. We will continue to engage with partners from all over the world, to better understand their concerns, and see how we can advance together. His Excellency John Bruton is Ambassador of the Delegation of the European Commission to the U.S.

Summit 2009

Bank Capital and the Credit Crisis

Bondurant

By Christian Johnson, Professor of Law, University of Utah S.J. Quinney College of Law

Starting in 2007, the world began slipping into an intractable credit crisis resulting in financial institutions of all types unwilling to lend to even their most creditworthy customers. In spite of enormous efforts by the Federal Reserve in the United States to increase liquidity in the credit markets, the problem has proven remarkably difficult to resolve the problem. Because financial Figure 1

Liabilities & Capital

Performing Assets

US$850,000,000

Deposits

US$900,000,000

Troubled Assets

150,000,000

Capital

100,000,000

Totals

US$1,000,000,000

A simple example using a bank’s balance sheet may help explain the difficulties in resolving the crisis. A financial institution (“ABC Bank”) is required by its regulator to maintain a capital ratio of 10 percent (capital/ assets), which represents the shareholder’s investment in the institution. Losses are first offset against the shareholder’s investment. If losses exceed a bank’s capital, the creditors would then suffer losses and the bank would be insolvent. Assume that ABC Bank has $850 million of performing assets and $150 million

During 2009, ABC Bank is required to write-down its troubled assets by US$70 million due to defaults

Assets

institutions such as banks are highly leveraged (i.e. they hold only a minimal amount of capital), when banks suffer losses, they find themselves either having to raise additional capital or reduce their total assets in order to meet regulatory capital requirements and investors’ expectations. These concerns are some of the chief reasons why lending has effectively ground to a halt.

Summit 2009

of nonperforming assets, such as mortgage-backed securities or commercial real estate loans that may be nonperforming. The balance sheet for ABC Bank as of 1/1/2009 would be as follows: (See figure 1.)

US$1,000,000,000 on its troubled assets. A write-down of the troubled assets generates a corresponding loss that reduces ABC Bank’s capital. Assuming that ABC Bank otherwise had no operating net income, ABC Bank’s balance sheet at 12/31/2009 would be the following: (See figure 2.) Because of the loss, ABC Bank no longer meets the 10 percent regulatory capital requirement. ABC Bank now has a capital ratio of 3.22 percent (30,000,000/ 930,000,000). Both from a regulatory and a safety and soundness perspective, ABC Bank will need to raise its capital ratio back up to ten percent or it will need to reduce its total assets. Given the current economic climate, ABC Bank’s problems become obvious. If ABC Bank suffered losses of $70,000,000 on its troubled assets, but wants to maintain its current asset portfolio, ABC Bank will need to raise additional capital either from current or new investors. However, as the stock prices of banks have deteriorated, there is little, if any, interest on the part of investors to put in new money in the form of capital into banks. Recently, it has become almost impossible to raise capital without direct governmental investment. If a bank is unable to raise capital, it can also sell assets in order to get its capital ratios in compliance. In the above example, however, due to the effect of leverage, ABC Bank would need to shrink its assets down to $300 million, requiring ABC Bank to sell $630 million in assets before its capital of $30 million would equal ten percent of its assets. Asset sales are as problematic as raising capital, however, because other banks at this time are not interested in purchasing these types of assets. Even if ABC Bank were to find a buyer for these

Summit 2009

Global Financial Crisis

assets, ABC Bank would typically have to sell them at a discount, generating additional losses. A major reason for the current credit crisis stems from this problem. In the event they suffer losses, banks are currently unable to either raise capital or sell assets to improve their capital ratios. As a result, they have stopped lending and taking risk. Banks are Figure 2

Liabilities & Capital

Performing Assets

US$850,000,000

Deposits

US$900,000,000

Troubled Assets

150,000,000

Capital

100,000,000

Write off

(70,000,000)

Loss

(70,000,000)

Net Troubled Assets

80,000,000

Net Capital

30,000,000

Totals

US$930,000,000

As capital has dwindled in the financial markets and the credit markets have seized up, the U.S. (as well as other governments across the globe) has engaged in two different approaches to the above problem. The U.S. responded in October of 2008 with the passage of the Emergency Economic Stabilization Act of 2008 (commonly referred to as “TARP” for the Troubled Asset Relief Program) in which the U.S. Congress authorized the U.S. Treasury to spend up to US$700 billion to resolve the credit crisis. The U.S. Treasury could do this either (i) by purchasing troubled assets from banks, or (ii) by making equity investments directly in them. From October 2008 through March 2009, the U.S. invested approximately US$300 billion through TARP principally through purchases of equity.

The U.S. Congress believed that because of the TARP equity investments, a bank would be more willing to lend because it had more capital. Commentators, however, generally do not believe that much additional lending has occurred because of TARP. This may be because banks still fear additional losses from new lending. It may also be because the banks that received

Assets

literally paralyzed by the fear of additional losses that would further erode their capital. Instead of looking for opportunities to lend, banks are instead trying to avoid incurring additional losses until they can rebuild their capital. The effect of this that banks investing in “riskless” assets such as bank balances at the Federal Reserve, U.S. government securities, repo transactions (which are fully collateralized) and other high credit quality assets as opposed to traditional lending to businesses and consumers. In contrast to these current conservative investments where transactions continue, commercial real estate lending, for example, has virtually halted.

Knowlegis

US$930,000,000 capital were in worse shape than anticipated. The TARP investments may very well have simply stabilized a precariously weaker than understood banking system. The U.S. Treasury Department, under the Obama administration, appears to be moving away from the equity investment approach, and is instead devising programs to purchase troubled assets directly from the banks. It is believed that getting the troubled assets off of the banks’ balance sheets will reduce the possibility of future write-downs that would further impair capital. Unfortunately, the concept has yet to be tested under current market stresses. The success of the U.S. Treasury and the Federal Reserve in reversing the credit crisis through TARP and other actions still remain to be seen. It will take months before the effects of equity investments and purchases by the U.S. government will have any effect on U.S. credit markets. In order to preserve its banking system, however, the U.S. appears to have little choice but to try and strengthen the capital held by its banks. Professor Christian Johnson teaches corporate finance and banking at the University of Utah College of Law and has written four books and over three dozen articles on the subject. Professor Johnson lectures both in the U.S. and abroad on the financial crisis.

Summit 2009

Can Sovereign Wealth Funds Be the Unlikely Saviors of Renewable Energy? By Rami Turayhi, Senior Contributor – Diplomatic Courier Magazine

Low-hanging fruit almost always trumps its brethren higher up the tree. With so many of today’s green energy pundits focused on developing the next generation of renewable energy technologies, policymakers have missed some potentially easy solutions that are immediately available to help spur investment and development in this heretofore undercapitalized industry. One such proposal combines the financial capital of the East with the human capital of the West, and could play a significant role in promoting green energy investment during this financial crisis. The proposed solution: use regulatory and tax incentives to promote sovereign wealth fund investment in renewable energy companies. For simplicity’s sake, this analysis is limited to Arab Gulf sovereign wealth funds (“SWFs”) and American renewable energy companies, but the same basic concept applies to any large state-owned fund and recipient country company. The proposal is straightforward and seeks to find common economic ground where it ought to already exist. The economic and political power of SWFs has increased quite substantially over the past decade; the largest fund in the Gulf today maintains over half a trillion dollars in assets, and most of the smaller ones hold at least a few tens of billions in capital. These funds have sought to lessen their dependence on highly unstable oil prices by diversifying their investment strategy and seeking out financially lucrative investment returns around the world. Host governments—largely democratic—have sought to assure an often suspicious public that these funds seek to do no harm, especially with regards to sensitive technologies and industries. The United States has even set up a Committee on Foreign Investment in the United States (“CFIUS”), in order to better regulate large investments by SWFs. Meanwhile, SWFs insist—and practice has largely affirmed their repeated assurances—that they are simply seeking financial returns and nothing more.

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Moving on to the other side of the equation, the election of President Barack Obama has recently focused a great deal of spotlight on renewable energy. The President has made a compelling case for using “green” technologies to help lift the United States out of recession on sustainable and politically responsible terms. A robust renewable energy-fed grid would help wean the United States off of foreign oil and gas, allow firms to project more stable long-term energy costs, and assist the United States in tackling global warming, perhaps within the rubric of a cap-and-trade or carbon tax sys-

tem that is enforced by global agreement. Arguments on behalf of renewable energy make it abundantly clear that, notwithstanding cost, green technologies are a net positive for the United States. The question, however, becomes more difficult when it comes time to determine exactly who is going to bear the brunt of the costs associated with this renewable energy revolution in the United States. That is where the SWFs come in. While the United States will certainly have to bear the lion’s share of the costs associated with renewable energy production, it should seek to offset at least some, if not a significant portion, of these costs by promoting SWF investment in the renewable energy industry. Doing so would at once provide badly-needed capital to this fragile industry during a time of curtailed lending in the United States, while also diverting SWF investment away from other industries where national security concerns might hold greater sway. The United States could seek to promote green energy investment by using a variety of means, but two that appear to be promising are regulatory and tax incentives. Any significant investment in U.S. companies by SWFs is subject to the relatively harsh and oftentimes humiliating rigors of the CFIUS oversight process. SWFs tend to desire privacy at all cost—they have little appetite for being subjected to any intense scrutiny by the American public, especially after the Dubai Ports debacle of 2006. One way to help target SWF investment in renewables, therefore, would be by allowing SWFs to proceed through a “fast track” CFIUS process. Given that the products of this investment are largely stationary—wind and solar farms are firmly rooted to the ground—there is little concern that SWFs would use their positions as major shareholders or lenders to affect nefarious designs. Quite the opposite could occur: SWF investors might use their clout to help disseminate technological know-how to other parts of the world—a net plus for the struggling international climate change regime. Taxes could also be restructured to help promote SWF investment in renewables. While SWFs currently pay little or no taxes as a result of their “sovereign” status, there are ways in which additional tax incentives could help focus investment in renewables. A tax credit, for instance, could be granted to SWFs that invest in renewables. This tax credit could be used to help offset other investments in less environmentally-friendly industries, or could be traded to polluters for cash. The latter proposal would be most effective within the confines of a carbon

Climate Change & Energy Security cap-and-trade system, a regime whose prospects for implementation in the near future look likelier by the day. Even in the absence of a cap-and-trade regime, tax incentives could largely mirror those within the Obama stimulus plan. The idea would be, in effect, to use some government money to bring in even greater amounts of capital—in this case foreign—to shore up an industry that most Americans want to see succeed. These two ideas—regulatory and tax incentives—are but a couple of suggestions that seek to achieve one common aim: increased SWF investment in the renewable energy industry. To the extent that other proposals complement these ideas or promote investment by SWFs more efficiently, they should also be pursued. The main point is that something ought to be done to put this excess SWF capital to work promoting renewables. The timing could not be better: SWFs have lost billions in recent months on account of losses sustained in the financial industry where much of their investment capital was located. They are thus sitting on their cash reserves, holding out for a sure bet. With the proper U.S. government incentives in place, a financially-lucrative renewable energy investment scheme could be exactly what these funds are looking for right now. One can foresee two major objections to any proposed incentive regime, but these can be either mitigated or dismissed by reframing the argument. The first objection was alluded to earlier: this notion that were SWFs to become major shareholders in renewable energy companies, they could potentially wreak havoc with U.S. energy infrastructure or disseminate sensitive technologies. Historic practice suggests otherwise. SWFs have not been the activist investors that naysayers predicted they would be; in fact, they may not be activist enough, but that is a topic for another day. Even assuming that these funds would seek to take actions that were potentially harmful to renewable energy companies for some political purpose, ample legal authority exists within both state and federal law to limit the ability of shareholders and lenders, even major ones, from acting in ways that harm companies and minority shareholders. If this does not allay concerns, an alternative proposal recently floated by legal scholars Ronald Gilson and Curtis Milhaupt could do the trick: suspend SWF shares’ voting rights, at least until they are sold to third-party investors. This regime would effectively mitigate any explicit negative influence that a SWF investor would have on a company’s Board of Directors, while at the same time allowing the fund to reap the financial benefits inherent in company ownership. The second and more substantive objection can actually be turned on its head to argue vociferously for increased SWF investment in renewable energy.

Skeptics argue that these SWFs, especially those from energy-producing countries, have little incentive to promote an industry that effectively diminishes the need for their own greatest source of capital—oil and gas—in the long-term. While the long-term effects of increased renewable energy production will indeed likely hurt the oil and gas industries, a number of factors suggest that SWFs will still choose to invest in renewables, so long as sufficient financial incentives are in place. For starters, the fact that these SWFs even exist confirms the notion that capital-rich countries are seeking to diversify their own assets away from just oil and gas. These funds would not exist if oil and gas producers did not want to start planning for a future where other revenue streams besides carbon-based ones start contributing to the countries’ fiscal stability. In addition, many of these countries, especially those in the Gulf, are seeking major image makeovers. This is evidenced by the recent surge in enthusiasm for green energy in the Gulf: Abu Dhabi is investing in a $20 billion carbonfree city, Dubai and Qatar have both recently announced massive investments in solar power plants, and green energy conferences are sprouting up throughout the region. Simply put, the Gulf—which maintains by far the largest SWFs in existence today—is on board with renewable energy. Indeed, it is in their interest to promote solar power in particular—the Middle East has a comparative advantage in promoting this technology, as the sun is their greatest underutilized asset. This proposal is as simple as it is novel. Use incentives, whether regulatory, tax, or something even more efficient, to promote renewable energy investment in the United States by capital-rich SWFs. It is hard to find a true loser in this proposal, as each major player seems to take at least something significant away from this grand bargain. The benefits of this scheme are many: the U.S. receives sorely-needed capital to boost its renewable energy sector, a revitalized labor-intensive renewable industry helps create millions of “green” jobs, the environment benefits without as much U.S.-led investment, green technologies would be spread to the Arab Gulf and other parts of the developing world, and, best of all, the United States would effectively be using the money it spends on dirty, foreign-sourced fuels, namely oil and gas, to subsidize and promote the domestic renewable energy sector. The irony is almost too wonderful for words. Rami Turayhi is a senior contributor with the Diplomatic Courier magazine where he reports on energy security and the Middle East. Mr. Turayhi is currently pursuing a JD at Columbia Law School in New York.

Summit 2009

Drafting a Carbon Emission Regulation System for the United States: Insight Provided by a Carbon Tax

The Noble Group

By Joseph Vandette, Hinckley Scholar, University of Utah Hinckley Institute of Politics

Once deemed a viable alternative to reduce carbon emissions in the United States, a national carbon tax has seen dwindling support. Momentum in favor of a marketbased cap-and-trade system has been growing steadily in the United States Congress, where draft bills of carbon emissions cap-and-trade programs have outnumbered national carbon tax proposals by a large margin. The establishment of the European Union Emission Trading System (EU-ETS) and other regional cap-and-trade initiatives in the United States has furthered the justification for a similar nationwide system in the United States. Moreover, President Obama’s 2010 budget has called for a cap-and-trade program to simultaneously generate revenues and reduce carbon emissions in the coming years. Though a national carbon emissions tax currently seems to be an unlikely candidate for regulating carbon emissions in the United States, the unique advantages of a national carbon tax should be considered when drafting a carbon emission reduction program. Under either carbon emission reduction program, the potential exists for the program’s effectiveness to be undercut by political bargaining and manipulation that results in certain industries gaining exemptions from the regulations. As exemplified in the EU-ETS, free carbon emission permits were allocated to energy producers in attempt to decrease financial burdens for these carbon emission-intensive industries. This practice was partially responsible for the “windfall” profits realized by energy companies1; energy producers passed on “implied” increased market costs to consumers2. The Obama administration has expressed interest in allocating all carbon emissions permits through an auction process, enabling a more equitable distribution. However, in recent draft cap-and-trade bills Congress has utilized free emission allowances as a ploy to gain bipartisan and businesses support3. In contrast, a carbon tax has the potential to be all-inclusive and non-bias by including bylaws that prohibit tax exemptions, though the tax could be rendered ineffective if some industries are successful in gaining exemptions. To ensure significant emissions reductions are achieved and to prevent “windfall” profits, draft carbon emission cap-and-trade bills should strive to employ only auction-based permit allocation schemes.

Energy price volatility, recognized as one fault in the EU-ETS4, should be a principal concern when drafting United States carbon emission regulation bills. As a priced-based approach to regulate carbon emissions,

a carbon tax would eliminate price volatility concerns. A carbon tax level is predetermined and this additional fixed cost attributed to energy prices will allow both energy producers and energy users to more easily determine their cost structures. Although price certainty exists under this scenario, carbon taxes do forfeit the ability to guarantee an exact quantity of emission reduction. Contrarily, under a cap-and-trade scheme, a limited supply of emission permits are distributed, which guarantees the total carbon emission levels can be reduced. The cost of emitting carbon in a cap-and-trade program, however, is determined by the demand for the emission permits, which correlates with factors such as the level of economic activity, seasonal demand for energy, price speculation surrounding tradable permits, and general energy prices. Because these factors are in constant flux, energy consumers under a cap-and-trade system are likely to pay inconsistent prices for energy, which is burdensome for businesses trying to manage and forecast costs. Draft carbon emissions cap-and-trade bills will likely be effective in reducing specific levels of carbon emissions, but the program should also incorporate a form of price regulation to ensure cost stability for consumers. The urgency of the climate issue is grounds for swift implementation of a United States emission reduction program. A national carbon emissions tax has the potential to be instituted relatively quickly via the existing tax code by utilizing the time-tested structure and collection mechanisms of the Internal Revenue Service5. In contrast, the creation of a carbon emissions cap-and-trade market may require the formation of a corresponding regulating agency to mentor the new commodity market, which could delay emission reductions. The recent failure of the under-regulated and convoluted financial markets would likely necessitate a great deal of transparency in a cap-and-trade program—a difficult feat for a complex system. A national carbon tax would be administratively simplistic and structurally transparent in comparison. A synergistic linkage of different cap-and-trade systems throughout the world may further delay implementation of such a system. A carbo tax, however, would likely be more easily adapted internationally because goods imported from countries without carbon emission regulations could simply be taxed at the border. U.S. lawmakers should consider transparency and expediency top priorities when drafting

Summit 2009

The Noble Group

Climate Change & Energy Security

carbon emission reduction legislation. Though the momentum surrounding an impending United States carbon emissions cap-and-trade market may have overwhelmed the possibility of a national carbon tax 6, the comparative advantages of a tax should be incorporated into draft carbon emissions cap-and-trade programs. Relative price certainty should be a priority in a cap-and-trade program, which can be achieved by setting price ceilings for emission permits or by establishing other cost-containment mechanisms as insurance against drastic increases in price. While essentially serving the function of a complicated carbon tax, a modified cap-and-trade system may prove more politically palatable than an outright tax. The Obama administrationâ&#x20AC;&#x2122;s call for an auction-based distribution of permits should be considered a valuable appeal and political manipulation of this component of a capand-trade program should be limited. Moreover, given the recent failures in the financial market, transparency should be paramount in a United States cap-and-trade program.

Joseph Vandette graduated with a B.S. in Environmental Studies and Marketing from the University of Utah and completed a Hinckley Institute of Politics internship in Washington, DC with the Department of Energy.

1 Ellerman, A. E., & Joskow, P.L. (2008). The European Unionâ&#x20AC;&#x2122;s emission trading system in perspective. Washington, DC: PEW Center on Global Climate Change. Retrieved February 1, 2008, from http://www.pewclimate.org/docUploads/EU-ETS-In-Perspective-Report.pdf 2 Houser, T., Bradley, R., Childs, B., Werksman, J., & Heilmayr, R. (2008). Leveling the carbon playing field: International competition and US climate policy design. Washington: Peterson. 3

Ibid.

Ellerman, A. E., & Joskow, P.L. (2008).

5 Metcalf, G.E. (2007). A proposal for U.S. carbon tax swap: An equitable tax reform to address global climate change. (Discussion Paper 2007-12). Washington, DC: Brookings Institution. Retrieved February 1, 2009, from http://www.brookings.edu/~/ media/Files/rc/papers/2007/10carbontax_metcalf/ 10_carbontax_metcalf.pdf 6 Metcalf, G. E. (2008, December). Analysis of a carbon tax. A National Carbon Tax: Another Option for Carbon Pricing. Lecture at the Environmental and Energy Study Institute Congressional Briefing, Rayburn House, Washington, DC.

Summit 2009

Finding Security in Climate Change

Climate Change & Energy Security

By Lincoln Davies, Associate Professor of Law, University of Utah S.J. Quinney College of Law

and infrastructure overhauls, renewables hold immense promise economically. And by shifting consumption away from limited resources—oil, coal, and nuclear— to those that virtually every nation already has—sun, wind, and water—increased reliance on renewables is likely to make health and wealth distribution much more equitable.

It is easy to chronicle the ills of climate change. The phenomenon threatens species, ecosystems, the very fabric of the natural world. It endangers our economy, the way in which agriculture now provides for us, the water supplies we rely on. It imperils global security, political stability, existing migration and disease patterns. Climate change could, as one multi-expert report recently concluded, “destabilize virtually every aspect of modern life.” It is, quite simply, the most daunting challenge we now face.

Renewables do not come without limitations. Their on-and-off availability throughout any given day means that, currently, they can only supplement other traditional electricity production resources. Their nascence means that the technologies for harnessing their power are not nearly as efficient as they someday will be. Moreover, the fact that there presently is no realistic technology available for storing electricity en masse means that a full transition to renewables likely remains decades away.

Despite the near-certainty of climate change’s many detriments, its emergence is not cause only for pessimism. There is at least one silver lining in the looming cloud of global warming. Ecological protection often is maligned as forcing a choice between “jobs or nature,” “the economy or the environment.” For decades, naysayers have used this false dichotomy as a foil to defeat environmental policies. Even now, as the United States Congress takes up the climate change question in earnest for the first time, advocates of the short-term point to the current global economic crisis as cause for even further delay. What such critics fail to recognize, however, is that climate change does not present an either-or choice. As scholars have long noted, acting to forestall climate change promises an economic opportunity for which every nation strives: energy security. Preventing climate change, indeed, demands changing course on energy policy. Energy use and climate change are inextricably intertwined. By far, the largest source of greenhouse gas emissions comes from the consumption of fossil fuels—the cars we drive, the electricity we produce. By the same token, the source of our energy insecurity can be found in a virtually identical locus—the reliance on scarce fossil fuels controlled by foreign nations and uncontrollable cartels. Thus, fixing one problem naturally profits the other. Sufficiently reducing fossil fuel consumption will eliminate the climate change risk. Shifting from fossil fuels to other energy sources likewise will moderate the political and economic risks engendered by energy insecurity.

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Different nations have different resources, and thus, carry different visions of how to reach their own energy security. For the United States, electricity increasingly appears the most ready substitute for petroleum consumption, at least in the transportation sector. But the United States’ current electricity mix is roughly 50% coal, 20% natural gas, and 20% nuclear. Consequently, simply switching from oil to electricity in the United States would solve neither the climate change problem nor the

But the limits of today should not cabin our vision of what tomorrow can be. Simply because the path to a fully secure, sustainable, and energy-independent society is a long one does not mean we should not take the journey’s first steps.

nation’s energy insecurity quandary. Coal and natural gas contribute heavily to greenhouse gas emissions, though the former much more than the latter. Natural gas also poses security risks, particularly in transportation. Nuclear fission technologies long have presented their own national security and environmental concerns, from the risk of proliferation to the dilemma that no nation has yet solved: how to safely store nuclear waste. As governments face these tradeoffs, a clear path has emerged. Renewable energies such as wind, water, and solar power offer a clean solution to both climate change and energy insecurity. The modern mantra of environmentalism is “sustainability,” the notion that sound policy should simultaneously protect the environment, foster economic development, and ensure equity for the long-term. These renewables offer progress on all three fronts. By reducing pollution, including greenhouse gas emissions, renewables are far more environmentally sound than traditional fossil and nuclear fuels. By offering the possibility of new technological progress

Many nations already have begun. A majority of European states have adopted “feed-in tariffs” that ensure renewable energy projects a preference price on their power. Other European nations and, importantly, more than two-thirds of the United States have adopted “renewable portfolio standards” that obligate electric utilities to acquire a given percentage of their power from renewable resources by a date certain. Adoption of any of these policies—or a combination of them— can help spur the transition away from climate change and energy dependence and toward sustainability and energy security. Increasingly, our tendency as a society is to focus on the myriad ills that climate change, if unchecked, may deliver. If this will yield action that prevents the disaster of climate change from transpiring, so be it. Perhaps, however, that view is too narrow. Perhaps we should see in climate change not just a burden to be lifted, but also an opportunity to rise up to. If we do, we might just find in climate change a kind of security we have never before enjoyed. Lincoln Davies is an Associate Professor of Law at the S.J. Quinney College of Law, University of Utah. He teaches and researches on energy and environmental law, administrative law, and civil procedure.

Summit 2009

The G-8 Global Partnership By Dr. C.S. Eliot Kang, ISN Acting Assistant Secretary – U.S. Department of State

The proliferation of weapons and related materials remains a concern for all of us in the international community, and President Barack Obama and Secretary of State Hillary Clinton have made plain that combating this threat worldwide is among the United States’ highest international security priorities. The G8 Global Partnership against the Spread of Weapons and Materials of Mass Destruction (GP) serves as the primary multilateral financial commitment to implement and coordinate chemical, biological, radiological, and nuclear (CBRN) threat reduction activities worldwide.1 At Kananaskis, G8 leaders undertook a farreaching and global commitment “to prevent terrorists, or those that harbor them, from acquiring or developing nuclear, chemical, radiological and biological weapons; missiles; and related materials, equipment and technology.” While GP activities have been focused in Russia and the former Soviet Union (FSU) since the formation of the GP in 2002, implementation of GP geographic expansion to combat CBRN proliferation and terrorism threats worldwide is now underway. The U.S. Government remains focused on fulfilling its GP commitments in Russia and the FSU, while at the same time working to implement the declaration made by G8 leaders at the 2008 G8 Summit in Hokkaido Toyako to begin GP geographic expansion to combat 21st century threats. Going forward, the GP can serve as a mechanism to secure critical financial support for concrete activities to combat global CBRN terrorism and proliferation threats.

Current Successes: Meeting Commitments in Russia and the FSU by 2012 The U.S. has committed over $1 billion per year under the Global Partnership, and is on target to meet its pledge of $10 billion over ten years by June 2012.

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Initial GP priorities identified at Kananaskis—the destruction of chemical weapons, the dismantlement of decommissioned nuclear submarines, the disposition of fissile materials, and the employment of former weapons scientists—remain critical initiatives, and the U.S. continues to honor its commitments made in these areas. The U.S. Department of Defense continues invest-

ing resources in close partnership with the Russian Federation and other international partners to complete the Shchuch’ye Chemical Weapons Destruction Facility to eliminate the most dangerous type of chemical weapon—nerve agent—by 2012. In another area of success, the United States funds the elimination of one Russian strategic nuclear submarine per year, which has been budgeted through 2012, depending on turnover of submarines for elimination. The program is also eliminating one Typhoon vessel and will shortly award a contract to eliminate a Delta III submarine. Over the same period, funding is also budgeted to help eliminate intercontinental and submarine ballistic missile launchers at least through 2012. Key interim goals were also met at the end of 2008 with respect to the U.S.-Russia Bratislava Nuclear Security Initiative, including the completion of material protection, control and accounting upgrades at all sites as defined in the Initiative. On scientist engagement, the United States and other GP members have also made great progress through the International Science and Technology Center (ISTC) in Moscow and the Science and Technology Center in Ukraine (STCU). Dual-use expertise that could be at-risk for diversion is a global threat, and lessons learned through the ISTC and STCU can be applied worldwide to address the global threat posed by terrorists and proliferant states seeking weapons and applicable expertise. There is a growing consensus that the ISTC in Moscow must be transformed to address emerging global scientific, nonproliferation, and security needs recognized by ISTC Parties. We look forward to working closely as partners with the Russian Federation to accomplish this. Overall, the United States has made great strides and is on target to meet GP commitments by 2012. That said, further progress must be made in turning Kananaskis pledges into concrete projects and activities. As the global financial crisis continues, it will be imperative to allocate funds precisely and to cooperatively develop plans to meet these critical commitments.

The Future of the Global Partnership (GP) Expansion of the G8 GP is now a reality, and every effort must be made to make that expansion a success.

The 2008 Hokkaido Toyako Summit leaders’ statement endorsed the expansion by stating, “We also recognize that the GP must evolve further to address new, emerging risks worldwide if we are to prevent terrorists or those that harbour them from acquiring chemical, biological, radiological, nuclear weapons and/or missiles.” 2

In addition, the United States believes the GP is an excellent venue to implement partnerships on meeting international commitments such as United Nations Security Council Resolution 1540, the Global Initiative to Combat Nuclear Terrorism, and the Biological and Chemical Weapons Conventions.

The United States believes successful GP expansion will involve three elements: geographic expansion of GP projects into countries beyond Russia and the FSU; expansion of GP membership to include new partners (both donors and recipients) from different regions throughout the world; and implementation of new concrete global threat reduction projects in priority international security areas that GP members can support.

Going forward and beyond 2012, the United States remains committed to expanding global threat reduction efforts worldwide in partnership with the G8, the entire GP, and new potential members. G8 leadership on nonproliferation and global threat reduction will be critical to combat the threats we collectively face from terrorists and proliferant states seeking to acquire weapons and related materials, technology, and expertise. The cooperative spirit of CBRN threat reduction established under the GP is critical to achieving this objective, and the U.S. looks forward to continued close cooperation with the Global Partnership in the years ahead.

In addition to the $1 billion allocated per year for threat reduction activities previously mentioned, the U.S. obligated more than $380 million in fiscal year 2008 to reduce the CBRN threat in nations outside the FSU. The focus for that global funding has been ensuring that dangerous materials, technology, and expertise are safe and secure in regions with high risk of terrorism, improving export controls and border security, and engaging former weapons scientists in Iraq and Libya. To further implement expansion, the GP is also considering outreach to new members to provide new resources, both financial and technical, to further the goals of the GP and to aid in its geographic expansion.

C. S. Eliot Kang, Ph.D., became the Acting Assistant Secretary for the Bureau of International Security and Nonproliferation on 20 January 2009. Previously, he served as the Deputy Assistant Secretary for Threat Reduction, Export Controls, and Negotiations and served, concurrently, as Special Adviser for North Korean Denuclearization.

In terms of new project areas, the United States maintains flexibility in its authorities to maximize funding opportunities across all areas of CBRN and missile threat reduction. Developing specific focus areas for global threat reduction projects could help other G8 and GP members gain financial support for new projects now and beyond 2012. On April 5, 2009, President Obama outlined his strategy for nuclear security in a speech in Prague, Czech Republic that stressed the importance of keeping nuclear weapons out of the hands of terrorists. Efforts will be directed to implement President Obama’s call to secure all vulnerable nuclear materials around the world within four years, and this goal will require the coordination and support of our international partners, especially within the Global Partnership mechanism.

The G8 GP is a $20 billion commitment over 10 years, established in 2002 at the Kananaskis Summit in Canada, and of which the U.S. has pledged $10 billion by 2012. There are currently 22 member nations (including the G8) plus the European Union in the GP. See: http://www.canadainternational.gc.ca/g8/index. aspx?lang=eng 2

Report on the G8 Global Partnership: http://www.mofa.go.jp/ policy/economy/summit/2008/doc/pdf/0708_12_en.pdf

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The Most Dangerous Threat

Non Proliferation & Terrorism

By David Irvine, Retired Brigadier General – U.S. Army

The changes in American life and our politics wrought by 9/11 have been profound, but they would pale to insignificance should a terrorist nuclear attack take place in New York, Washington, or, for that matter, anywhere in the world. It is highly probable that among the victims would be the Bill of Rights, with all that would imply for our system of democratic government. Nuclear terrorism from non-state actors and nuclear proliferation are the most dangerous threats we face and have the greatest likelihood of occurring.

frittered away with North Korea and Iran by the refusal of President Bush to apply Churchill’s maxim: “Jaw-jaw is better than war-war.”

While we know where most of the world’s store of warheads and fissionable material is likely to be, we have no way of knowing where all may be hidden away. Part of the problem is of our own creation. For decades, the U.S. has transferred enriched uranium to more than 40 nations, which, if misused, could construct more than 1,000 weapons; however, little has been recovered, even though it was supposed to have been returned as spent fuel.

With each of these three nations, unless the fissionable cat is already out of the bag, our ability to ensure that loose nukes, nascent nukes, and new nuclear weapons remain secured or undeveloped—Graham Allison’s three priorities for preventing nuclear terrorism— will depend, not on our military strength, but on the vitality of American diplomacy and economic strength. These necessary tools cannot be deployed without direct negotiation. To be successful with North Korea and Iran, President Obama, personally, will have to refurbish old alliances and work to create new ones. It isn’t so much a challenge of structuring new architecture that will operate with greater effect, as it is getting more in-

The importance of recovering that material cannot be ignored, but the most urgent focus of our attention should be the risk of theft or unauthorized transfer of

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weapons or weapons grade material from Pakistan and North Korea, and the emerging Iranian uranium enrichment program which threatens the Middle East tinderbox like nothing else ever has. No challenge the Obama administration faces during the next four or eight years is of greater significance to American security than what happens with these nations, and in each instance, this president begins his term badly hobbled by the approach of his predecessor to all three. Eight years were

As for Pakistan, we seem to have fallen back on hope as our plan: we hope that the government has full control of its nuclear weapons; we hope that the intelligence services are loyal to President Zardari, and we hope that Abdul Khan is not shipping atomic secrets and material to North Korea, Iran, or bin Laden.

ternational commitment to and putting enough resources into Cooperative Threat Reduction, the International Atomic Energy Agency, the Nuclear Proliferation Treaty, and the Nuclear Suppliers Group—to enable existing programs to function as they were intended. The full cooperation of Russia, India, Pakistan, Israel, and China are indispensable to a global nuclear security effort that must come to grips with the danger of

a nuclear-armed North Korea and Iran—and a Pakistan teetering on the verge of chaos. The world cannot afford to allow Pakistan’s weapons and technology to go astray. It is to the Obama administration’s credit that it is rethinking the U.S. presence in Afghanistan with more of an eye to Pakistan’s security and stability. Whatever may be the definition of the military mission at the moment, we are perceived by the Iraqis, Afghans, and Pakistanis as occupiers at best and imperialists at worst. Foreign occupation breeds resentment and hatred, and our presence and cross-border operations become threats to the stability of the very governments we seek to assist. We can’t deal with Iran without meaningful Russian help. We might have had more of that had we been less eager to offer NATO membership to former Soviet states. We can’t view (or treat) every Muslim as a potential terrorist.

faster than we can field combat battalions. The focal point for defeating nuclear terrorism is where the weapons and weapons grade material are stored. The Bush administration’s most glaring failure was its mismatch of national resources to what and where the real threat is. A quantity of enriched uranium sufficient to construct a nuclear bomb is, in volume no larger than a six-pack; the necessary plutonium would equal a couple of cans. Lead shielding would add size and weight, but it would substantially reduce the probability of detection. In view of that, the detection challenge cannot even be framed in the needlein-a-haystack comparison, because the linear scale of porous geographic borders to the size of the object of any search defies imagination. We cannot successfully interdict even the hundreds of tons of illegal drugs which find their way into the U.S. every year.

The irrationality of our current national security strategy becomes quickly evident when we compare resource commitment and attention focus to threat ranking. Nuclear terrorism is our most dangerous threat, yet over the last 15 years; we have only committed $7 billion to the Cooperative Threat Reduction program, which has made a good start (but not much more) with former USSR stockpiles. Neither Iraq or Afghanistan poses a nuclear threat to us, but those wars are being financed on a national credit card at a cost to date (depending on whose numbers are used) of $1.6 trillion. If the real focus of those wars is al Qaeda, the cost per potential terrorist killed to date is ridiculous. We are spending unsustainable sums of borrowed money in an attempt to kill off a terror delivery system that can regenerate itself exponentially

If the Obama administration is seeking an onthe-shelf set of excellent policy recommendations, it need only look to “Securing the Bomb 2008,” a comprehensive study commissioned by the Nuclear Threat Initiative, headed by former Senator Sam Nunn. Much time and money have been wasted, the task to be accomplished is very, very difficult, but the price of failure beggars description. Mr. Irvine is an attorney in private practice in Salt Lake City. He was commissioned as a strategic intelligence officer in the Army Reserve in 1967 and retired as a brigadier general. He is a graduate of the Army War College, and maintained a faculty assignment for 18 years with the Sixth Army Intelligence School.

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Non Proliferation & Terrorism

Encouraging Nuclear Nonproliferation & Disarmament: Lessons from Social Psychology

media coverage. For example, Peace Depot in Japan is a small NGO with big impact. The group publishes reports that outline the Japanese government’s promises on nuclear issues, and then grades the government based on their action (or inaction) that year. The Japanese media report extensively on Peace Depot materials, amplifying their influence.

By Dr. Maria Rost Rublee – University of Auckland

With continuing nuclear crises in the Middle East and East Asia, the question of how to promote nonproliferation and disarmament is more important than ever. Recent social psychology research highlights multiple ways to encourage countries, organizations and even individuals to help stop the spread of nuclear weapons.

Strengthening the Nuclear Nonproliferation Regime The Nuclear Nonproliferation Treaty (NPT) and associated agreements—known as the nuclear nonproliferation regime—are more important than ever. The regime embodies the nuclear nonproliferation norm— that is, it provides the normative foundation for saying “civilized states don’t seek nuclear weapons.” Before the NPT, acquiring nuclear weapons was an act of national pride; after, it became an “act of international outlawry,” noted U.S. Ambassador Thomas Graham. But the NPT does more than just draw a line in the sand. It also creates social mechanisms that can influence how policymakers think about the value of nuclear weapons. For example, social psychology has found that the need to appear consistent is a powerful motivator of human behaviour. States that have signed and ratified the NPT, as well as participated in treaty review conferences and other associated activities, are less likely to later withdraw from the NPT and/or covertly seek nuclear weapons. This is true not only because individuals feel a need to act consistently but also, because, over time, a bureaucracy dedicated to the goals of the NPT grows within the state, gaining influence and leverage. Such a bureaucratic establishment makes it harder to reverse course—a form of institutional consistency.

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Another social mechanism embedded in the NPT is what psychologists call a “descriptive norm”—that is, people notice what we do at least as much as what we say. The more people who do X, the more everyone else thinks that X is the right thing to do. In this way, the NPT creates a clear descriptive norm that shapes how policymakers view those who do and do not adhere to it. Almost every state in the world is a member of the NPT, and almost all of those states adhere to their treaty commitments. So the NPT is about more than words and lectures—it’s also about overwhelming global compliance, which helps to influence how elites conceptualize nuclear weapons. Indeed, few countries are lining up to become the next “rogue” state.

Social psychology also helps us understand how the NPT changes the social cost-benefit equation of nuclear decision-making. Some states support nuclear nonproliferation because they are persuaded that nuclear weapons are not in their best interest. However, other states refrain from nuclear weapons because they are conforming; that is, they may wish to develop nuclear armaments, but consider the social costs too high. Without the NPT, the cost-benefit equation changes dramatically for these states, and not in favor of nuclear nonproliferation. These normative benefits would disappear if the NPT were weakened or if the treaty collapsed. In that case, the normative costs of going nuclear would drop, and states around the world may reconsider their nuclear restraint. The policy conclusion is to maintain and strengthen the NPT so that embedded social mechanisms remain robust.

Rethinking Our Approach to “Rogue” States Another relevant lesson from social psychology is from the “in-group vs. out-group” literature. People are more likely to accept normative pressure from those they like, while normative pressure from the “disliked” tends to backfire—think of rebels who gain status by breaking the rules. For this reason, a rogue state is unlikely to respond well to lectures from the country benefiting most from the status quo, which is why normative pressure from the U.S. usually adds fuel to the fire. A better way to approach problem states is through countries and experts considered neutral. Libya, which gave up its nuclear weapons program in 2003, would be an especially good choice. The Libyans can argue from experience about the benefits of abiding by the NPT, including increased global economic integration and greatly reduced concerns about state security. Another good choice is China, whose experts can talk about the value of focusing on economic development from the point of view of a developing country. Other neutral states that will not be seen as mouthpieces of Washington are also better positioned to make effective normative arguments. Social psychology also tells us that creating conflict destroys the fertile ground necessary for normative influence. Conflict polarizes people, leading them to shut

Peace groups are also acting creatively—and on shoe-string budgets. For example, the New Zealandbased Parliamentary Network for Nuclear Disarmament (PNND) facilitates cooperation and information sharing among anti-nuclear parliamentarians around the world. If members in one country find a particular tactic effective, they can share it world-wide with other members, who can then adopt the strategy for use at home. Because they can leverage their influence and adapt tactics to their local situation, peace NGOs are a low-cost yet effective way to promote the twin norms of nuclear nonproliferation and disarmament.

Small, Steady Steps on Disarmament Atomic Bomb Dome in Hiroshima

off normative messages from “enemies.” The policy lesson here is if we are negotiating to end a nuclear weapons program, we should avoid creating new points of conflict in other areas, thus increasing the likelihood that problem state will comply. This does not mean that we should avoid conflict over the issue of nuclear proliferation. Rather, if stopping nuclear proliferation is our highest priority, we need to place all other conflicts on the back burner until the issue is solved. Whether this is realistic or not is a judgment call for policymakers. The point is that introducing new areas of conflict will likely undermine existing normative influence we have on the nuclear issue.

Supporting Peace NGOs A recent study showed that in three different democracies, peace nongovernmental organizations (NGOs) helped keep the countries non-nuclear by making the political costs of going nuclear prohibitive. So while conservative elites may have preferred the nuclear option, they instead decided to stay in power and settle on other ways to manage insecurity, such as accepting a security guarantee from another country. While peace NGOs perform many tasks, activities that attract media attention are particularly helpful in influencing government policy. By focusing public awareness on the nuclear issue, peace NGOs make it harder for governments to craft policy undermining either nuclear nonproliferation or disarmament. Some peace NGOs are becoming increasingly effective in leveraging

Recent events have heartened supporters of nuclear disarmament—from U.S. President Barak Obama’s speech in Prague to the Russian nod to further reduce nuclear stocks. What can we do to continue the momentum toward nuclear disarmament? Social psychology might advise, “Small, steady steps.” When asked to make big sacrifices, people often refuse. But people find it easier to make small sacrifices and will often agree to do so, which makes them much more likely to consent to larger sacrifices for the same cause later on. This is because “commitments grow their own legs,” as psychology Robert Cialdini argues. Once a small commitment is made and kept, people often internalize the commitment, making bigger sacrifices more likely. So instead of pressuring nuclear weapons states to move toward disarmament immediately, a better method is to ask for small but sure steps in that direction, such as ratification of the Comprehensive Test Ban Treaty, negotiations for a Fissile Material Cut-Off Treaty and, of course, further reductions in nuclear stocks. By getting the ball rolling, these incremental efforts will likely lead to internalized commitment to nuclear disarmament, making the ultimate goal more likely. Maria Rost Rublee is a lecturer at the University of Auckland and author of the recently published Nonproliferation Norms: Why States Choose Nuclear Restraint (Athens: University of Georgia Press, 2009).

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On Combating Global Terrorism

Nuclear Non Proliferation & Terrorism

By Ryan Harding, Correspondent - Diplomatic Courier Magazine

Since September 11, 2001, discussions about terrorism have centered largely on the state of al-Qaeda, its membership, and its systematic circumscription. With some success, pressure has been placed on main arteries providing al-Qaeda and other like-minded and like-willed organizations with material support, leaving those organizations ischemic and depleted of financial support. Yet, despite this attention, terrorism persists. Now, America’s eye has shifted away from Iraq to Afghanistan and Pakistan, the latter of which was recently labeled “terrorism’s epicenter.” With fresh attacks occurring in Mumbai, Lahore, and elsewhere in the region, the challenges facing South Asia (particularly Pakistan) will be difficult to surmount. However, preceding this great shift of attention and resources, it would be a beneficial exercise to take stock and consider the current state of global terrorism both as an idea and a phenomenon.

Defining Terrorism Discursively, terrorism has come to take on many different meanings and has been cast in numerous lights. If there is one thing that can be said about the body of literature that exists on the subject of terrorism, it is that there is a complete lack of consensus about not only how “terrorism” should be countered strategically, but its meaning as an idea; what, as a term, it implies and to whom it refers; and how it is currently manifesting itself. The issue is certainly semantic at its heart: without international agreement about the meaning of terrorism, there can be no reconciliation between views. Nonetheless, in order to come to grips with the issue of global terrorism, the definition of terrorism must be somewhat flushed out. The idea that 9/11—or even the decades preceding it—ushered in a new era of terrorism has pervaded political discussions on terrorism and media coverage of terrorism. Making taxonomical sense of this new species of terrorism, it was deemed that this new form of terrorism—typified by violent militant Islamic groups— was different from earlier forms in terms of, among many things, its objective (seemingly nonpolitical and religiously motivated), method (indiscriminate, nonstrategic killing of bystanders), and scope (global, instead of regional or local).

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Antonoy Field of the University of Warwick, however, points out that idea of a “new terrorism falls short of a useful analytical concept” insofar as by segregating contemporary examples of terrorism from past examples we obscure, and obviate the need to thoughtfully consider, history. Field points out that while there are indeed

differences, the “shift in the nature of terrorism has been exaggerated” inasmuch as “traditional terrorism” and “new terrorism” have in common those very things used to divide them; their method, objective, and scope. In addition to this, because terrorists have been described as an amorphous enemy whose demands are incapable of being met, terrorism is seen as something seemingly insurmountable, leaving us often to forget that “[t]he attacks of 11 September 2001 by al-Qa’eda were not simply a form of cathartic punishment; they also served a broader strategic purpose with the aim of coercing the government of the United States to change its foreign policy.” The question, therefore, is, if indeed conquering terrorism is not an insurmountable goal (keeping in mind, however, that the threat of terrorism should not be underestimated), what is the appropriate response to terrorism?

Is Terrorism Losing Ground? Patrick Porter, in his aptly titled article “Long war and long telegrams: Containing Al-Qaeda,” rehabilitates George Kennan’s Cold War strategy of containment. Porter develops, with great efficacy, a narrative about terrorism which runs counter to most. Citing success in disrupting the flow of capital to terrorist organizations, in addition to “restricting the movements of militants and tracking down principal leaders,” the U.S. could embark on a policy of containment. Porter’s idea of containment is also predicated on the idea that al-Qaeda and like organizations will continue to alienate former supporters and offend most Muslims. While attacks have not ceased and are becoming more visible (with attacks targeting high profile targets such as Sri Lanka’s cricket team), movements against violent extremist brands of Islam also have not ceased. In Algeria, the organization known as the Salafi Group for Call and Combat (GSPC) has experienced difficulty recruiting, one of which reasons is that “the GSPC no longer have the support within the population” due to a drawdown of tensions in Iraq and a decline in Al-Qaeda activity. In Bhubaneswar, Muslims from across India united at an anti-terrorism conference in condemnation of terrorism. In Pakistan, an opinion poll taken by Terror Free Tomorrow, shows that Osama bin Laden’s popularity has declined steeply, from 33 percent in August 2007 to 18 percent in January 2008, and in the northwest territory, it has fallen from 70 percent in August 2007 to 4 percent in January 2008. AlQaeda and linked cells of support have overplayed their hand with the local population, systematically alienating many of their supporters. Instead of being “the knight of Islam… [Al-Qaeda] persecutes and impoverishes Muslims.”

Nonetheless, terrorism continues to be a problem. In November 2008 the world watched as terrorists killed over 170 people in Mumbai, harming an already strained relationship between Pakistan and India. Pakistan has currently taken five of the nine “alleged collaborators” in custody as it continues to experience strained relations with India. Pakistan has seen multiple terrorist attacks in Lahore recently, one of which—perpetrated by the Taliban—was directed at the Sri Lankan cricket team and left five Pakistani policemen dead and seven players injured. While terrorism has persisted elsewhere, with insurgents representing the group al-Shabab firing mortars at a plane carrying a U.S. congressman out of Mogadishu, Pakistan has grabbed America’s attention. Unable to effectively govern much of its tribal frontier territory, policymakers worry about it being used as a staging ground for terrorist organizations. Also of concern is the interconnection between unrest in the northwest of Pakistan, and the country bordering it, Afghanistan. However, in designing policy meant to combat this terrorism, somewhat of a shift in thinking is required. While the idea that the germ of the modern phenomenon of terrorism is socio-economically related is hotly contested on both sides, the support terrorist groups receive among local populations should not be

overestimated nor should the West’s ability to gain favor in the eyes of those in the Middle East who are thought to look upon the West unfavorably. After the earthquake in Pakistan in 2005 “Pakistanis with positive views of the United States” went up “from 23 per cent to 46 per cent.” And, after the Tsumani, the United States gained ground in opinion polls, including in Indonesia. When tailoring policies in response to terrorism it might help to look at the War on Terror through a constructivist lens: it might be that perhaps the language of the War on Terror has circumscribed America’s response to terrorism to primarily military action, and the prospect of a “new terrorism” has obscured the way in which terrorism is approached and countered. Projecting a positive image through humanitarian work is one of the most effective ways of undermining terrorist support and “undercut[ting] the image of America” as “the imperialist predator.” Even though terrorism persists, it might be that America has overlooked the greatest weapon in its arsenal: humanitarian aid. Ryan M. Harding reports on International Organizations, Global Governance, and Latin America for the Diplomatic Courier magazine in Washington, DC.

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Democracy Promotion: Productive Long-term Strategy, Not Counterterrorism Answer1 By Andrew Jensen, Hinckley Scholar, University of Utah Hinckley Institute of Politics

Democracy promotion has been a fundamental principle of U.S. foreign policy since the end of the Cold War and has been used to prevent political extremism and transnational terrorist violence in the war on terrorism. According to this strategy, when democratic standards are infused in a state’s political structure, the occurrence or probability of terrorist acts will decline. Yet the empirical data and case studies on the causes of transnational terrorist violence demonstrate this assumption moderately inaccurate in many vital respects. The correlational studies literature on democracy and transnational terrorism illustrates that the presence of democracy—notably during its weak and untried stages—often provides an unpredictable environment where terrorism is able to flourish. Even more advanced democracies, like India, are susceptible to terrorist acts due to other significant variables, such as social and religious division, multipartism, and the tendency toward extremism2. On the other hand, more authoritarian states, such as China, with excessive rule of law often preempt terrorist groups from organizing and carrying out violent political acts.

Theoretical Interpretations of Events Data Although the arguments concerning terrorism and democracy seem to have reached a watershed in their primary focus on failed, failing, and weak democratic states as most susceptible to terrorist violence, there are still many states that have/do not fit into these ideal types. Using various methodologies, scholars have shown that terrorists hailed most often from democratic countries in the past; that historically, terrorist attacks occurred more often in democratic countries; and that transnational terrorism transpired more often in states experiencing regime change.3 The story has been narrowed further by using the ITERATE4 to determine that established democracies are less prone to terrorist activity than non-democracies, but a causal relationship was also drawn between new democracies and frequency of terrorist acts5. As was later shown, most terrorist violence has been committed by individuals of the same nationality as their victims and most often in (frequently mature) democratic states.6

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Other less quantitative, contributory factors were later accounted for to fill in some of the existing gaps in the literature. One scholar maintains that a more accurate indicator needs to be developed, so instead of looking solely at regime type in the aggregate, main causal

factors within democracies should be isolated.7 James Piazza first takes on the so-called “rooted-in-poverty hypothesis” that argues terrorism is the result of socioeconomic discontent. He points out that only three of the top ten countries experiencing terrorism-related casualties had low socioeconomic development and the top ten cases with “intense” terrorist violence were all “medium to high” on the scale of socioeconomic development. Additionally, the case-study analyses on relative deprivation are rooted in the 1970s and the authors are too loose with their definitions, often interchanging civil conflict and domestic insurgency with terrorist activity. Indicators based on “social cleavage theory”— particularly social and religious division, multipartism, and the tendency toward extremism—more accurately predict if a country is prone to terrorism.8

Indian Heterogeneity India serves as an important example to demonstrate the inaccuracies surrounding many U.S. leaders’ insistence that democracy and development are solutions to the problem of terrorism. In 2003, India accounted for 75% of terrorist incidents among countries classified as “free” with most attacks originating from Pakistan.9 In 2007, if deaths caused by terrorism in Iraq and Afghanistan are factored out, 1,093 of 7,113 (or 15%) of global fatalities happened in India.10 The social cleavage model seems to be more precise in documenting the complexities of the Indian case. India is one of the most diverse countries in South Asia, encompassing copious ethnic factions and political parties. Significant caste and religious rifts divide the country along provincial and linguistic lines. Although Hindi is the official and dominant language, its use is consigned primarily to the northern part of the country.11 On the national level, these social and religious fissures prove detrimental. Lok Sabha—India’s lower house of parliament—had thirty-eight different parties from 1999-2004 and the dominant party of Bharatiya Janaata only constituted 23.7% of total seats during this time.12 The uncertain political party structure with numerous ethnic and religious cleavages contributes to the precariousness of the situation and the persistence of tension, often ending in terrorist violence

Chinese Homogeneity From 2000-03, 203 international terrorist attacks were recorded in India and zero in China. From 1976

Nuclear Non Proliferation & Terrorism

to 2004, 400 incidents occurred in India and only 18 in China. As Gregory Gause points out, even if China is underreporting and the number increases ten times, it still falls significantly short of the number of transnational terrorist incidents occurring in India.13 China offers a striking contrast to the diverse cultural, religious, and linguistic climate in India. The mostly homogenous Chinese Communist Party (CCP) governs and maintains complete military control over all the provinces and allows relatively little opposition. The National People’s Congress is a unicameral legislative branch that acts according to demands of the Party and Politburo.14 Over 90 percent of the Chinese population is Han and most minority and political opposition groups have been alienated, integrated forcefully, and/or branded as dissidents. Religion in China consists mainly of observing local customs and traditional beliefs, though practice is limited by the pervasive atheist political convention of the ruling Socialist leadership. Derived from mixtures of Buddhism, Confucianism, and Taoism, this “religious pluralism” evokes a more amiable atmosphere than the Middle East and South Asia primarily because it is practiced by similar people with the same ideals of “harmony” and “unity”.15 Lastly, political extremism that followed the considerable social and economic disruption after the Cold War—notably in the Soviet Union—was likely curbed by CCP limits on political transparency and democratizing forces.16 China did experience significant growth as a result of semi-free market policies and partial decentralization, but its leaders have maintained significant control over political processes and groups.

Democracy Promotion Not Enough Democracy promotion is a worthy strategy and should remain one of the pillars of U.S. foreign policy, but should not be seen as the crucial solution to the problem of transnational terrorism. Instead, the focus should be on policies that promote rule of law, education and assimilation, and that heal deep social and religious divides, rather than the unrelated focus of advancing free and fair elections, socioeconomic development, and reductions in economic disparity. The Indian and Chinese cases viewed through the social cleavage model demonstrate that a more nuanced and rigorous approach is essential for the U.S. to develop an effective international counterterrorism policy.

1 This essay is based on a previous paper I wrote (to be published) entitled, “Terrorism via Democracy? Assessing Democracy Promotion as a Security Rationale,” Hinckley Journal of Politics, Vol. 10 (forthcoming). 2 James Piazza, “Rooted in Poverty? Terrorism, Poor Economic Development, and Social Cleavages,” Terrorism and Political Violence, Vol. 18, No. 1 (2006), pp. 159-177. 3 William Eubank and Leonard Weinberg, “Does Democracy Encourage Terrorism?” Terrorism and Political Violence, Vol. 6, No. 4 (Winter 1994), pp. 417-443. See also Eubank and Weinberg, Terrorism and Democracy: What Recent Events Disclose,” Terrorism and Political Violence, Vol. 10, No. 1 (1998), pp. 108-18. 4 ITERATE:

International Terrorism: Attributes of Terrorist Events. See James Piazza, “Do Democracy and Free Markets Protect Us From Terrorism?” International Politics, Vol. 45, No. 1 (2008), pp. 72-91.

5 Joe

Eyerman, “Terrorism and Democratic States: Soft Targets or Accessible Systems,” International Interactions, Vol. 24, No. 2 (1998), pp. 151-70.

6 Weinberg

and Eubank, “Terrorism and Democracy: Perpetrators and Victims,” Terrorism and Political Violence, Vol. 13, No. 1 (2001) pp. 155-64.

Piazza, “Rooted in Poverty?”

8 Ibid. 9 South

Asia Terrorism Portal, “India Assessment – 2007,” Accessed 6/2/2008, http://satp.org/satporgtp/countries/india/index. html.

10 National

Counterterrorism Center, “2006 Report on Terrorism,” http://wits.nctc.gov/reports/crot2006nctcannexfinal.pdf; Also, “2007 Report on Terrorism,” http://www.terrorisminfo.mipt.org/ pdf/NCTC-2007-Report-on-Terrorism.pdf

11 Piazza,

“Rooted in Poverty?”

12 Ibid. 13 Gregory Gause, “Assessing Middle East Security Prospects,” Institute for National Strategic Studies Symposium, Ft. McNair, April 20-21, 2005, http://www.ndu.edu/inss/symposia/topical2005/ gausepaper.pdf. 14 BBC

News, “Inside China’s Ruling Party,” http://news.bbc. co.uk/2/shared/spl/hi/asia_pac/02/china_party_congress/china_ ruling_party/html/default.stm.

15 Zhibin

Xie. Religious Diversity and Public Religion in China (Great Britain: Ashgate, 2006).

16 Kishore

Mahbubani, “Understanding China” Foreign Affairs, Vol. 84, No. 5 (Sep/Oct 2005), pp. 49-60.

Andrew Jensen graduated from the University of Utah with an Honor B.S. in Political Science in 2009., and served a Hinckley internship in Washington, DC with the House Committee on Foreign Affairs.

Summit 2009

China’s Investment in Africa: Development or Neo-Colonialism? By John Bavoso, Africa Correspondent – Diplomatic Courier Magazine

Driving down any given road in the United States, one has very little occasion to contemplate who constructed said thruway or where the funds for its completion originated. Travel down a newly paved road in a country like Liberia in West Africa or a reconstructed railway in Angola, in the continent’s southern region, and consideration of the origins of such infrastructure projects results in delving into complex relationships involving the international community and issues such as paternalism, accountability, resource dependence, human rights, and neo-colonialism. Such far-reaching associations are due to the fact that the struggle between the West and China has found a new ground-zero in the last decade: subSaharan Africa. Foreign aid makes up much of the national budget of many sub-Saharan African countries, and for decades most of this aid has been coming from Western countries and international organizations such as the International Monetary Fund (IMF) and the World Bank (WB). One of the downsides of this aid, from the perspective of many African leaders, is that these funds come with strings attached: conditions, such as the creation of anti-corruption and poverty-reduction plans and the privatization of public services, are attached to loans, debt relief, and bilateral aid provided for sub-Saharan African countries. Economically emerging countries within the international system have taken note of how resentful of many of these conditions many sub-Saharan African states have become, considering them the height of Western paternalism. This has led to the rise in popularity in recent years of a phenomenon sometimes referred to as “south-south cooperation,” a concept which posits that developing countries, which comprise the “Global South,” are turning to other developing countries for assistance and trade rather than more developed countries. The most striking example of this has been China’s prodigious interest in sub-Saharan Africa and the natural resources and opportunities for energy creation it offers.

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China’s growing population is known for being one of the most energy-hungry in the world, leading the Chinese government to constantly search for reliable sources of natural resources to power its continued development. Tense relations with the West over issues such as human rights and political ideology have resulted in the country looking to other areas of the world to meet

its needs. Sub-Saharan Africa, with its vast stores of natural resources like oil, platinum, and copper, lack of infrastructures in many areas, staggering levels of debt and increasing disdain for Western interference in economic matters, has presented China with an opportunity to meet its economic goals while also expanding its global influence. Upwards of 85 percent of China’s oil imports now come from five different African countries: Angola, Equatorial Guinea, Nigeria, the Republic of Congo, and Sudan. The Asian giant also receives large amounts of other resources such as diamonds, timber, and copper from the region. This has shot China into the position of being Africa’s second biggest trading partner—behind the United States, but ahead of the countries of Western Europe. On the African side, individual countries have been given impressive amounts of funds for projects such as road and railway reconstruction meant to boost infrastructure. China has agreed to forgive large amounts of African debt, refuses to put conditions on money going to countries on the continent, and practices a policy of non-interference in terms of domestic issues such as governance and human rights protection. When asked, many Africans indicate that they appreciate the fact that, unlike dealing with the IMF, the World Bank, or many Western donor countries, dealing with China is a positive experience because the Chinese “treat Africans like adults,” rather than children in need of disciplining and oversight. The West has been quick to point out that China’s interest in the region, despite its rhetoric, is less than altruistic and that, despite its claims, the influx of cash flooding the region is doing more harm than good. Many parties in the international community see the country’s role in the region as more exploitative and parasitic than beneficial. For instance, while funds from China go towards many infrastructure improvements, the actual projects are, more often than not, completed by Chinese nationals who are brought in for the purpose, taking viable and much-needed jobs away from local African workers. Also, China’s policy of non-intervention means that it pumps money into non-democratic regimes and, in the case of the Sudan and Zimbabwe, for instance, keep human rights abusing governments afloat despite condemnation and criticism from much of the rest of the world. While it’s interesting to see so much renewed interest in an otherwise neglected region of the world, as with many other issues in the international community, the

voices of Africans tend to get lost in the shuffle. While both sides of the issue argue that they have sub-Saharan Africa’s best interests in mind, this current round of debate is reminiscent of the Cold War era, where Africa was a battlefield upon which the conflicting interests of the world’s superpowers could unfold, much to the detriment of Africans. Within sub-Saharan Africa, a debate rages as well. Many Africans appreciate the idea that they are “treated like adults” by the Chinese and they feel that this new source of funds may be the impetus needed to help pull the continent out of decades of poverty. Others, however, have expressed concerns about what China gets in exchange for its raw materials: a market for its low-cost consumer goods. The influx of foreign goods, taken together with the Chinese insistence on using their own laborers rather than the local workforce, leaves many Africans worried about the future of domestic industries and jobs. There is also a fear that, as the world’s natural resources begin to become scarcer, a new “scramble” for Africa, this time between the West and China, will once again overtake the continent. With all of these competing interests, ideas and narratives, is there any way to develop a strategy which benefits all parties and minimizes damage to the Africans who are often caught in the middle? From the Western perspective, in order for the U.S. and its allies to have any credibility in decrying China’s non-interference and tacit support of human rights abusers, they will have to reevaluate support of countries like Saudi Arabia, which provide steady oil supplies but have seriously questionable human rights policies.

The U.S., and the rest of the West, should also increase their diplomatic presence in sub-Saharan Africa if they hope to balance China’s influence. The international community doesn’t have a great track record in terms of helping Africa when the region needs it the most when its own interests aren’t threatened, and a greater interest in the area may go a long way towards increasing credibility. There are also other avenues which Africans can explore. The “south-south cooperation” model doesn’t just apply to countries outside of the region. South Africa, for instance, is the only sub-Saharan African country to be included in the ranks of G8+5 and G20 countries, and this offers an alternative opportunity for funding, which is closer to home and represents a country with more of a stake in the prosperity and stability of the region. However the international community chooses to proceed in the future, it is important to pause and consider the fact that the lives of everyday Africans are very much at stake when such economic decisions are made. There is a very real risk that sub-Saharan Africa may once again become the victim of economic colonization, but there also exists an equal potential that renewed interest in the region may lead to lasting development. Greater inclusion of African voices this time around may just help to avoid some of history’s worst pitfalls. John Bavoso is a graduate student at the School of International Service at American University focusing on issues related to human rights, gender and sexual equality, and sub-Saharan Africa at the Diplomatic Courier magazine.

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A Prescription for Development: Curing What Ails Foreign Aid to Africa By Erika George, Professor, of Law, University of Utah S.J. Quinney College Of Law

Far too often images emerging from Africa depict poverty, disaster, conflict, and suffering. With increasing regularity industrialized nations express their intentions to provide additional development aid to assist Africa with ameliorating the poverty responsible for much of the suffering experienced by so many on the Continent. Despite the best intentions on the part of donor countries, efforts to uplift debtor nations frequently fail to meet or fall far short of articulated expectations. At the 2005 Summit, G8 members answered former British Prime Minister Tony Blair’s call for increasing aid to Africa and pledged to commit additional resources to development aid. Today however these pledged goals have not been reached. In the current climate of global economic downturn Africa’s actual receipt of these pledged resources appears to be increasingly remote. In the meantime, images of African misery and suffering continue to capture the public imagination.

There are multiple motivations for offering aid. For example, a 2006 U.S. AID published primer illustrates a perceived role for aid to play in promoting national security and waging the “War on Terror.” Along with defense and diplomacy, development is advanced as supporting U.S. geostrategic interests central to combating terrorism and strengthening American security at home and abroad. Aid is then an investment against instability, a “leveraging instrument,” a device for perception management to counter anti-American propaganda.

The Diagnosis: What Ails Aid? Sharp differences persist in the public debate over the ability of foreign development aid to change and improve the images coming out of Africa. Does foreign aid promote or prevent development in Africa? Development assistance has committed devotees who maintain that aid, when responsibly distributed, has been successful in saving and improving lives by increasing food production, promoting disease control, and providing safe drinking water among other things. Increasingly, however, development assistance has detractors who charge that aid has failed to accomplish its aims. Some argue that aid actually perpetuates poverty. Economist Jeffery Sachs advocates more rapid and increased levels of aid for Africa in his book The End of Poverty. According to African author and economist Dambisa Moyo’s Dead Aid, aid to Africa needs to end entirely and immediately. Those critical of aid can point to instances of failure. They argue that aid distorts incentives and promotes dependency. Those who champion aid can point to some successes. They assert that lives can be saved for as little as a dollar a day. Even if such assistance does not directly result in economic growth, some forms of aid still remain effective.

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Although the debate is currently characterized by a sharp division over whether assistance is effective or whether it kills the kind of entrepreneurship imperative for elevating people out of poverty, there appears to be some emerging consensus that intervention is urgently needed. But what ails aid?

Besides perceived self-interest, pity appears to play a motivating role for some aid donors. A significant and perhaps underexplored problem with aid concerns how many see Africa—more as a charity case than a cooperative venture partner. Were the motivating intention animating interaction with Africa to invest in a future partner instead of self promotion or pity the incentive structures in the aid enterprise could arguably look quite different perhaps with benefits accruing to those within and outside of Africa.

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Development in Africa In addition to perception problems with respect to Africa in particular and the aid enterprise more generally, there are more practical difficulties with aid delivery. One problem has been the demand by some donors that in return for assistance aid recipients must use and source goods from the donor nation. Restricting the recipient from sourcing locally or finding better bargains can leave a recipient country in a circumstance of always paying back and not investing forward. Complex reporting requirements for recipient countries present another problem by generating additional administrative costs which in some instances diminish the benefits of aid significantly. Most significant, however, is the unfortunate fact that recipients—the poor people in debtor countries—have virtually no voice in the aid determination and delivery process.

A Prescription: An Antidote in Mutual Accountability There are competing and contradictory claims over aid’s efficacy. Evidence seems inconclusive, so arguments over how best to better the lot of the Continent’s poorest are unlikely to end soon. Certainly, the world’s “bottom billion” cannot wait for a consensus to build. Interventions to improve aid must include a mechanism for accountability to the intended beneficiaries of aid. Much of the attention in the public debate over the efficacy of development aid to Africa has centered on conditions in the recipient country. Donors and aid agencies have identified corruption and poor governance as barriers to development and appropriately are demanding more responsible management of aid resources received. While these concerns are appropriate, less attention has been paid to responsible resource management on the part of aid agencies in donor countries.

mutual monitoring mechanism may serve to yield better mutual outcomes and could potentially set the stage for better understanding and adjusting incentives towards a form of aid that is invested in and accountable to those most in need. Accountability could be advanced by a mutual monitoring mechanism with sufficient independence and transparency to permit a place for the voice of the neediest recipient to be heard and an opportunity for the donor to listen and learn. A mutual monitoring mechanism must also promote the development of a more constructive reciprocal relationship between nations engaged in the aid exchange. Such a relationship may cure the imbalances afflicting the current aid system by better ensuring that what is offered is aligned with the interests of those in need. Erika George is a Professor of Law at the University of Utah’s S.J. Quinney College of Law where she teaches international human rights and humanitarian law, international environmental law, constitutional law, and civil procedure. Professor George graduated from Harvard Law School. She completed a M.A. in International Relations and earned her B.A. in Politics Economics Rhetoric and Law with honors both from University of Chicago. She continues to conduct human rights advocacy and outreach projects, she is also a frequent lecturer and writer on issues of women’s human rights and international human rights. Her human rights work has been covered by BBC, The Economist, NBC News, CCN, and the Christian Science Monitor. Acknowledgements: Ben Lear and John Mbaku

Economist William Easterly has observed that aid agencies are typically not accountable to their intended beneficiaries. As a result, there are no incentives to deliver to intended beneficiaries. Moyo suggests that many African governments have no incentives to help their people and aid further exacerbates the lack of accountability and impunity already enjoyed by those in power. The question then becomes—how better to set incentives such that someone will accountable to the bottom billion? Collectively, G8 member states should work to design such an incentive structure. Donors and development aid recipients together should consider the design of mechanisms to mutually monitor aid resources.

Summit 2009

Easterly has proposed that donors create “international independent evaluation groups” separate from government but including nationals from the stakeholder nations involved in aid. Some form of independent

Summit 2009

Mugabe’s Zimbabwe: A State’s Decline from Fragile Democracy to Electoral Authoritarianism

Regional Crises

1 “Mugabe swears in rival Tsvangirai as Zimbabwe PM”. (2009, February 11). The Guardian. Retrieved April 8, 2009, from http:// www.guardian.co.uk/world/2009/feb/11/tsvangirai-zimbabweprime-minister-mugabe.

By Dustin Gardiner, Hinckley Scholar, University of Utah Hinckley Institute of Politics

If the outcome of Zimbabwe’s last presidential election is an indication, President Robert Mugabe’s strong foundation for authoritarian rule is beginning to crumble. Although Mugabe has maintained his decades-long grip on the presidency even after he lost the March 2008 election by most accounts, he has since ceded to international pressure and formed a unity government with opposition leader Morgan Tsvangiari, who is acting as prime minister.1

The move comes after a humanitarian and economic crisis paralyzed the country last fall when Mugabe refused to sign off on a final power-sharing agreement with Tsvangiari. As Mugabe’s government fell into disarray, basic services, such as access to clean water, deteriorated, resulting in a cholera outbreak and widespread food shortages.2 The humanitarian crisis coupled with ongoing political disputes and violence led to a crash in the value of the Zimbabwean currency, causing a mass exodus of capital and people from the country. The panic sent the economy further into a downward spiral. Seeing the growing crisis and Mugabe’s unwillingness to engage in power sharing talks, international leaders, including several of Mugabe’s former allies, intensified their criticism and sanctions against Mugabe’s administration. Kenyan Prime Minister Raila Odinga led the charge, calling for international military intervention to remove Mugabe and end the Cholera outbreak.3 Mugabe eventually succumbed to the pressure and growing need for international aid.

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However, despite the formation of a unity government, which gave Tsvangiari authority over day-to-day governing and calls for the creation of a new constitution4, Mugabe still retains much of the power that he

has accumulated in nearly thirty years as the country’s leader. In the absence of an embarrassing and growing humanitarian crisis that drew the attention of many foreign leaders, Mugabe might have been able to avoid forming a unity government entirely. In short, Mugabe maintains much of the foundation for authoritarian rule that has enabled his power-grab and Zimbabwe’s decline from a fragile democracy to electoral authoritarianism, though his basis of power is weakening. The term electoral authoritarianism is used to describe regimes that present an “illusion of multi-party democracy at the local and national levels while effectively stripping elections of efficacy.”5 While elections are held often, the state is not considered democratic because the ruling leader or party uses government institutions and informal powers to manipulate vote counts or strip the opposition of its ability to effectively compete against the incumbent regime. Unlike a fragile democracy where elections are mostly free, fair and provide a chance for real competition despite the existence of weak institutions, elections in electoral authoritarian states don’t allow any chance for real electoral competition.6 Mugabe’s stranglehold on power is perhaps most apparent in his ability to maintain the presidency even after numerous international observers have discredited the results of the March 2008 presidential election as fraudulent.7 The nation nearly descended into anarchy when Mugabe refused to release the results of the hotly contested election and ordered the violent suppression of protesters supporting Tsvangirai’s Movement for Democratic Change.7 After delaying for over a month and committing numerous human rights violations, Mugabe released fraudulent numbers showing Tsvangirai had beaten him by a six percent margin, but failed to win a majority and to avoid a run-off election. Mugabe stalled again by extending the date of the run off election until late June. Tsvangiari agreed to the runoff but withdrew and fled the country after it became clear Mugabe’s government would continue to use violent means to secure a victory. Following the results of the election, there were nearly 90 reported killings that resulted from political violence, and members of Mugabe’s ZANU-PF Party were primarily responsible for the deaths.9 Many more were injured and imprisoned. The intimidation techniques even focused on MDC presidential candidate Tsvangirai, who was arbitrarily arrested, beaten and later released without being charged on five separate instances.9

2 “Cholera epidemic is still ‘out of control’”. (2008, December 28). The Associated Press. Retrieved April 8, 2009, from http://www.guardian.co.uk/world/2008/dec/28/zimbabwe-cholera-epidemic-child-malnutrition.

Underlying Mugabe’s basis for electoral authoritarian rule is his position in Zimbabwe’s deep-seated military culture and a network of patronal relationships with elites. Violence and military intervention in political campaigns has been an ongoing problem in Zimbabwe, particularly with the ZANU-PF. Mugabe, who is well-know as a leader of the liberation forces that fought the British and white colonists for independence, first used the military to wage war against the forces of a major political opponent shortly after Zimbabwe gained independence in 1980.10 The 2008 election is just the latest example of his using the military to intimidate and suppress opposition protesters to secure a victory. Mugabe’s ability to remain in office despite widespread support for the opposition and international condemnation of his tactics is also reflective of his ability to build a network of patronal relationship with political elites, including military leaders, bureaucrats, and key members of the ZANU-PF. The relationships generally involve the trading of presidential favors in exchange for political support from elites. Because the elite tend to support political leaders who serve their self-interest, a willing president like Mugabe can yield a heavy amount of informal influence.11 Mugabe seems to have gained a considerable amount of leverage over elites through his re-appropriation of millions of acres of farmland seized from white plantation owners without compensation. He seized most white land holdings saying they would be given to rural blacks in retribution for the fertile lands that were taken from natives by colonial settlers. However, much of the land was given out to top government and military officials to secure their loyalty.12 The unwillingness of elites to defect from Mugabe after the 2008 election is a testament to the strength of his patronal network. While much of Mugabe’s foundation for authoritarian rule remains intact, the formation of a unity government has provided an opportunity for Tsvangirai and the opposition to erode his power base. With the next presidential election several years away and a new constitution on the table, the opposition must work to restore the rule of law and prevent another sham election that simply reinstates Mugabe’s power.

3 Mudzwiti, M. (2008, December 8). “Mugabe buys more time”. The Times of South Africa. Retrieved December 8, 2008, from http://www.google.com/search?q=zimbabwe+us&ie=UTF8&oe=UTF-8. 4 McGreal, C. (2009, February 10). “Tsvangirai to be sworn in as Zimbabwe prime minister”. The Guardian. Retrieved April 10, 2009, from http://www.guardian.co.uk/world/2009/feb/10/zimbabwe-coalition-tsvangirai. 5 Tlemcani, R. (2007, May 24-30). “Electoral Authoritarianism”. Al Ahram Weekly Retrieved December 6, 2008, from Carnegie Endowment for International Peace Web site:http://www.carnegieendowment.org/publications/index.cfm?fa=view&id=19176&prog=z gp&proj=zdrl,zme. 6 Waterbury, J. (1999). “Chapter 12: Fortuitous Byproducts”. In Anderson, L. (Ed.), Transitions to Democracy. New York: Columbia University Press. Retrieved December 7, 2008, from http://www. ciaonet.org.tproxy01.lib.utah.edu/book/anderson/anderson12. html. 7 “MDC seeks new Zimbabwe election”. (2008, October 21.) BBC News. Retrieved November 17, 2008, from http://news.bbc. co.uk/2/hi/africa/7681468.stm. 8 Whitaker, R. (2008). “Zimbabwe election violence spreads to Harare.” The New Zealand Herald. Retrieved November 14, 2008, from http://www.nzherald.co.nz/world/news/article.cfm?c_ id=2&objectid=10517688. 9 “Tsvangirai arrested in Zimbabwe”. (2008, June 4). United Press International. Retrieved November 19, 2008, from http://www.nzherald.co.nz/world/news/article.cfm?c_ id=2&objectid=10517688. 10 Lyman, P. N. (2007). “Zimbabwe: The Limits of Influence”. In Lyman, P. N. & Dorff, P. (Eds.), Beyond Humanitarianism (89-100). New York: Council on Foreign Relations. 11 Transparency International. (2008). “Corruption Perceptions Index.” Retrieved November 17, 2008, from http://www.transparency.org/news_room/in_focus/2008/cpi2008/cpi_2008_table. 12 Human Rights Watch. (2008). “Our Hands Are Tied”: Erosion of the Rule of Law in Zimbabwe. Johannesburg: Human Rights Watch Africa Division. Retrieved December 7, 2008, from Ciao Net online database: http://www.ciaonet.org.tproxy01.lib.utah.edu/ book/anderson/anderson12.html.

Dustin Gardiner graduated from the University of Utah with B.S. degrees in Political Science and Mass Communications and was the editor of the university campus paper, the Daily Utah Chronicle.

Summit 2009

European Union Enlargement and the Islamic Challenge

Regional Crises

By Dr. Joseph S. Joseph, Jean Monnet Chair in European Foreign Policy and Security Policy, University of Cyprus

The geographic expansion of the European Union poses challenges and presents opportunities to the EU itself, but also to the member states and the candidate countries. It also affects the deepening of the Union and its efforts for institutional reform, which is not an easy task, as the failure of the constitutional treaty and the difficulties faced by the Lisbon treaty have shown. As of January 2009, there are three candidate countries: Turkey and Croatia, which started accession negotiations in 2005, and the Former Yugoslav Republic of Macedonia (FYROM) which has been granted the status of a candidate country, but has not yet started accession negotiations. There are also five potential candidate countries: Albania, Bosnia and Herzegovina, Montenegro, Serbia, and Kosovo under Security Council Resolution 1244. These countries have been promised the prospect of EU membership as and when they are ready. While accession talks and preparations are under way, the debate over Turkey’s European prospects and identity is heating up and a variety of perspectives, positions, opinions and arguments are put forward. The former president of the European Commission, Romano Prodi, while arguing for the commencement of accession negotiations back in 2005 asked Turkey to show “determination in pursuing further reforms and wisely conduct an accession process which, like all the others, will display both periods of progress and moments of tension and unavoidabledifficulties.” He also appealed to the member states and the European public to demonstrate equal perseverance, as “Europe has nothing to fear from Turkey’s accession.” After three years of accession negotiations, difficulties and Turco-skepticism are growing over Turkey’s membership prospects. Europe’s confusion and ambivalence about Turkey is not a new phenomenon, although recently it has been becoming more visible. For example, in March 2007, Turkey’s government was not invited to the Berlin Summit which marked the 50th anniversary of the Treaties of Rome, causing disappointment in Ankara.

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A few years ago, the fear of many Europeans about Turkish accession were expressed and stirred up by the former French President and head of the European constitutional convention, Valery Giscard d’Estaing, who in a blunt manner declared that Turkey was “not a European country” and that its inclusion in the EU “would be the end of Europe.” In a similar vein, echoing Turcoskepticism, a European Commissioner brought back

memories of the Ottoman siege of Vienna by stating that “the liberation of 1683 would have been in vain” if Turkey joins the EU. On the other hand, there are strong voices arguing that Turkey can play the role of “a cultural and physical bridge between the East and West [and] become one of Europe’s most prized additions.” Across the Atlantic, the United States has a clear pro-Turkish position that cannot be ignored. In June 2004, during the NATO summit in Istanbul, the American President George W. Bush underlined the position and called on Europe to prove that it “is not the exclusive club of a single religion” and that “as a European power, Turkey belongs in the EU.” The increasingly polarized discussion over Turkey’s position and role in Europe will continue for years to come at various levels. The debate may even outlast the protracted period of accession negotiations during which

not only negotiations on the acquis chapters will be conducted, but also a lot of diplomatic maneuvering and political twisting will take place. Throughout this period, the Christian and Islamic worlds will have to show that they can accommodate each other and prove false Samuel Huntington’s argument about “the clash of civilizations” and the reconfiguration of the political world “along cultural lines”. Both Europe and Turkey will find out what they expect from each other and whether they can share a common future that will reconcile their different pasts. The real question will be whether the internal sociopolitical dynamics and external orientations of Turkey can be compatible with the changing dynamics of European integration, which aims at deepening the solidarity among peoples “while respecting their history, their culture and their traditions”, and creating “firm bases for the construction of the future Europe”. In the long run and in a broader sense, the challenge

for the EU will be to develop a forward-looking worldview based on a multicultural civilization that has ample room for different religions including Islam. In a shrinking world of increasing interdependence and a new European order of deepening and widening integration, this may no longer be a political option, but an urgent imperative. After all European integration is a process of building unity through diversity. In a few years, not only Turkey, but also the Balkan enlargement, which will include more countries with Moslem populations, will pose the same challenge. In light of these developments, Turkey is not a test case, but a turning point. Dr. Joseph S. Joseph is Professor of International Relations and European Affairs and Director of the Jean Monnet Centre of Excellence at the University of Cyprus. He is also a member of the Editorial Advisory Board of the Diplomatic Courier magazine.

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The message of European businesses to the G8 Short term priorities are crucial… but Europe should look at longer-term too!

Europe remains decades behind the US...

The meeting of the G8 certainly represents an opportunity for world leaders to work on a coherent international response to the crisis and to get the global economy back on a pathway to growth. No doubt this is the main priority for the short term.

As the graphic left shows, the EU27 is lagging behind the United States for all key economic indicators (GDP per capita, productivity, investment in R&D) by an average of 24 years. This means that the EU’s current performance on these indicators was already reached by the US in the 1980s!

The European business community, however, urges decision-makers not to forget about the longer term perspective. They are concerned that, even when the economic downturn is over, Europe will still be lagging behind its international partners.

Investment in R&D is the worst indicator, with the current level of European investment in research and development having been attained by the United States 30 years ago.

EUROCHAMBRES’ most recent “Time-Distance Study” supports this vision. This unique report compares the European economy with the USA and the BRIC countries (Brazil, Russia, India and China) using several different key economic indicators…in terms of years. Based on ‘what-if’ scenarios, the study shows how many years the EU would need to catch up with its competitors, as well as the conditions for growth that developing countries would need to bridge the time distance gap.

…and BRICs are catching up fast

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vestment in R&D and skills. Policy makers must provide businesses with the right framework conditions to drive Europe’s recovery and future growth.” A healthy and growing global market – including A stronger Europe, as well as a healthy and growing global market, is beneficial to businesses the world over; it is to no-one’s advantage to pursue a larger slice of the cake if the cake itself is getting smaller. To this end, EUROCHAMBRES has consistently advocated more open international markets and continues to push policy makers to take measures to reduce trade barriers, minimise the risk of unfair practices and, especially in the current climate, to resist protectionism. The European Chamber network looks to the G8 leaders to further these aims.

The chart also shows that the EU remains well ahead of all BRIC countries for every economic indicator, although to varying degrees. Russia stands on average 35 years behind the EU, Brazil nearly 40, China just over 40 years and India 68 years. Yet high growth rates – which remain well above the EU’s growth even in times of crisis – are allowing these countries to close the gap.

How Europe can close the gap 1) The business environment

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Commenting on these findings, Arnaldo Abruzzini, Secretary General of EUROCHAMBRES, said: “These figures tell us that if the EU is to maintain and enhance its global competitiveness, it must put in place not only a short term strategy to exit the recession, but also longterm structural reforms. Time is not on our side…we cannot afford to delay any longer the much needed in-

Europe needs a highly skilled workforce to compete on the global market. One of the key priorities in the current crisis is thus to safeguard employment and to prepare the workforce for the upswing after the crisis. Education systems should be adapted to the needs of European enterprises, eliminating skills mismatches and creating a closer cooperation between academia and businesses.

3) Infrastructure and energy The emergency measures proposed in response to the crisis, namely improving the energy efficiency of buildings and modernising different infrastructures related to energy, ICT and transport, constitute an important step in the right direction. It is important that the measures are translated into action rapidly, laying the foundations for a more energy efficient Europe. At the same time, research efforts for the development and widespread use of renewable energies should be considerably increased.

4) R&D and Innovation

A rnaldo A bruzzini , EUROCHAMBRES’ S ecretary G eneral

Russia is the closest to catching up with the EU27 GDP per capita value, followed by Brazil and China. If the current differential between EU and Chinese growth remains around 10%, China could reach the current level of EU GDP in 2020, as illustrated in the graph below.

2) People

The current crisis necessitates measures to enhance access to finance for businesses, to reduce administrative burdens and to promote entrepreneurship. Businesses need quicker and simpler access to credit on realistic terms and improvements in payment terms and times from public and private sector clients. The reduction of administrative burdens should be accelerated to further improve the business environment, with the medium term focus on meeting the target of 25% red tape reduction at EU and national level by 2012. Promoting entrepreneurship is important in times of economic crisis, as entrepreneurs are the true wealth creators and are thus essential to re-launching the economy and generating sustainable growth.

Investment in research and development and the conversion of this into innovative initiatives are key elements in Europe’s competitiveness. During past crises, these elements have often been the first victims of budget cuts. It is imperative that this trend is avoided during the current crisis. Both public and private sector investment in research needs to increase significantly.

EUROCHAMBRES is the Association of European Chambers of Commerce and Industry. It represents over 19 million enterprises in Europe – 96% of which are SMEs – through members in 45 countries and a European network of 2000 regional and local Chambers. The 2009 edition of EUROCHAMBRES’ Time-Distance Study can be downloaded from www.eurochambres.eu/content/default. asp?PageID=1&DocID=1792

Summit 2009

Between the Justice of Islam and the Injustice of Tradition

Regional Crises and women equally, and our secular laws attempt to do the same.

By the Honorable Hala Bsaisu Lattouf, Minister of Social Development Kingdom of Jordan

If you search for the words “Women in Islam” on the internet you are likely to find two things: commentary suggesting Islam is derogatory to women, and attempts to debunk this myth. Unfortunately, the image of Muslim women in the world is that of rigid obedience and supplication to men. In reality, we reflect the customs, practices and socially ascribed religious beliefs of our culture. In preparing this paper a number of topics ran through my mind. Poverty or democracy in Islam would have been fitting subjects due to my current service as Minister of Social Development. Yet, as a woman from Jordan, I see women in Islam often being misrepresented and misjudged. The other day my daughter told me she heard Muslim women could not be leaders in government. As a woman working in government, this statement took me back. I wondered where she heard this idea. Here in Jordan, we have been progressive in enhancing the rights of women. His Majesty King Abdullah II is a tireless advocate for women and children, and has described crimes against them as “sabotage” against the community. We have also increased women’s participation in public life. The present Cabinet, Senate and the Lower House of Parliament have a much greater number of women than in times past. Jordan was even the first Middle Eastern country to have a female garbage truck and taxi driver. Surprisingly, 24 percent of Jordanian youth who participated in a survey analyzing morals and values believed women were more suitable than men as political leaders. Ten percent of these were young men. This is significant because it shows a male population who would put their political future in the hands of women. However, a recent survey of over five thousand Jordanian women contained some more intuitive statistics. According to the study, 81.4 percent of these women felt they were being treated unjustly due to existing traditions and customs. In contrast, only 14.2 percent held Islam responsible for discrimination. I interpret this to mean the cultural norms need adjustment, not the Islamic faith.

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Although a practicing Muslim, I have never considered myself solely a “Muslim” woman per se, rather a Jordanian-Arab Muslim. However, since 9/11 I have come to identify myself with these women more than simply by nationality. I find myself often, if not always, “randomly selected” and searched by airport security just as frequently as other Muslim women. I am portrayed in the media alongside

The Shehada, or testimony, is also widely questioned. It is often thought that this means two women are needed to testify before a court of law in the place of one man. This is actually only limited to situations when women were not directly involved. They are, however, still allowed to testify, whereas men were prohibited from testifying in cases pertaining specifically to women, such as a woman’s virtue.

them as part of a discriminated gender, despite the situational differences between women across Muslim countries. Some may think it odd for a woman born and raised in the heart of the Middle East to not experience gender stereotyping. My parents made every effort to raise me as a strong human being, with a very enlightened belief of Islam. I never felt inferior to men. Now, with children of my own, I try to instill the same sense of equality I experienced growing up. I realize they do not live in a vacuum, and that society and cultural values play an important role in influencing how they think. Many Muslim women live happy and fulfilling lives in their home countries. Why then, do I continually see reports in the media suggesting acts of abuse and intolerance are committed in the name of Islam? The Islam I practice and read about in the Holy Quran does not condone these actions. However, tradition, much which comes from pre-Islamic societies, perpetuates this image. Some of these customs have led to cruel injustices. Sadly, many try to justify harmful traditions through their faith. This gives power and legitimacy to their actions. Having said this, not all of these traditions are bad. Drinking Arabic coffee during marriage proposals, helping strangers who have lost their homes and providing generous hospitality for guests are some of the many positive traditions in the Arab culture. When I married my husband we signed a marriage contract in accordance with Islamic teachings. This document promotes equality, prevents abuse and is similar to a prenuptial agreement. In it, I could specify conditions my husband must legally meet. Such conditions may include the right of divorce, the ability to deny him additional wives, entitlement to servants, or the location of our future home. Women can even require payment for cooking and cleaning if they choose to do so, I personally prefer to do neither. Unfortunately, some women feel they cannot take advantage of these rights either for fear of being denied marriage or because their cultural upbringing, under the guise of religion, has led them to believe women are not equal to men. Furthermore, Islam grants women exclusive financial independence. Not only do I have the opportunity to list the “cans” and “cannots” in my marriage, but any money I bring into the relationship remains mine. Any wages I earn after I am married are also mine to spend as I wish. While Islam requires a man to pay and support the needs of his family, the woman is exempt from this

responsibility. Yet tradition in some families requires girls to pass their inheritance on to their brothers, something we are working hard to change. Islam provides women with an extensive array of political rights. Early Muslim women gave a monetary pledge of allegiance to the Prophet Muhammad (peace be upon him). According to the Hadith, Caliph Omar consulted both men and women as to who should be his successor. The Prophet Muhammad (pbuh) was even employed by his future wife, Khadija. Additionally, the first convert to Islam, the first tortured and killed for their beliefs in Islam, and the first Muslim judge were all women. Comparatively speaking, many women in modern Islamic societies have made advances much faster than in Europe or the United States. Various heads of government such as Megawati Sukarnoputri, former President of Indonesia have served in Muslim states. The office of Prime Minister has also been held numerous times by women such as Khaleda Zia in Bangladesh, Tansu Ciller in Turkey, and the late Benazir Bhutto in Pakistan. The United States has yet to elect a female president, while Europe has made some progress with female leaders such as Margaret Thatcher and Angela Merkel. In addition, Turkey and Sri Lanka were among the first to grant women the right to vote, while Switzerland waited until 1971. Undoubtedly, Muslim women have made substantial advances in Islamic nations. Despite this political progress, harmful social traditions exist which do not follow the council of Islam. Honor killings, for example, are violent acts which find no root in the Muslim faith. It is an abhorrent tradition handed down from pre-Islamic times. Jordan has recognized its existence and has spoken out against it. Under Islamic law, adultery is nearly impossible to prove. To eliminate honor killings, we need to change the cultural mindset to understand that these murders are a crime in Islam and society. In all offenses Islamic law punishes men

I often hear other human rights activists discussing how they can rescue Muslim women from the presumed horrors men afflict on their lives. This confuses me because I am certainly not the only woman who loves and treasures her father, brother, and son. I most certainly will nor be the last. I come from a culture with many positive traditions. It is a culture where immediate and extended family ties are strong. It is a culture where a mother can choose to work as a homemaker if she so desires. Homemaking is viewed as a respectable career and not demeaning servitude. I come from a culture which knows its neighbors and cares for their well being just as if they were their own family. The Prophet Muhammad (pbuh) instructed us, “God enjoins you to treat women well, for they are your mothers, daughters, aunts.” Although these words were spoken centuries ago, they hold true for all people today. As Muslim women, we are caught between the justice of Islam which provides protection and equal rights, and the injustice of certain traditions which subject some to abuse. Muslim women are not alone in this struggle. We, as an international community, must do more to guarantee equality among both men and women and overcome the negative aspects of our respective cultures. Otherwise, we stand to lose our humanity. Hala Bseisu Lattouf is Jordan’s Minister of Social Development. Minister Lattouf earned a Masters Degree in Financial Management and later served as Executive Director of World Links Arab Region making commendable achievements in the education of Arab youth. She has also held important positions in the Office of Her Majesty Queen Rania Al-Abdullah. Currently, she resides in Amman, Jordan with her husband and two children. Acknowledgment to Maranda Skoubye.

Summit 2009

Pakistan, Afghanistan, India: Report on the State of Conflict

Regional Crises Iran—Western leaders may determine that it is of such strategic importance that “losing Afghanistan” is “beyond the conceivable.”

By Amos N. Guiora, Professor of Law, University of Utah S.J. Quinney College of Law

This potential reality, then, raises significant questions regarding the “limits of power.” How far foreign governments can (or will) go in protecting their interests—whether ill or well-defined—is the essence of the Afghanistan question. Afghanistan does not present the immediate threat Iraq did. Rather, Afghanistan is more appropriately categorized as a perceived threat suggesting clear operational limits. That said, if any of the above mentioned threats become “palpable” then decision makers would determine whether their respective national interest are at stake. The answer to that question would determine how the limits of self-defense are applied.

In the immediate aftermath of Benazir Bhutto’s assassination1 many commentators asked the appropriate question: who is guarding Pakistan’s nuclear warheads. Although it is beyond the scope of this essay to examine the development of Pakistani nuclear capability, suffice it to say that the combination of Pakistani nuclear capability along with troubling instability presents enormous potential for regional and international conflict. It may be the single greatest potential source of international instability. President Obama’s decision to continue former President Bush’s policy of conducing aggressive attacks against Bin-Laden in Pakistan is manifestation of the widely agreed upon consensus of the international intelligence community that al-Qaeda’s leader is hiding in Western Pakistan. Similarly, it is the working assumption of British radicalization experts that Pakistan is critical to the radicalization of British Muslim youth. Furthermore, according to Indian intelligence, the overwhelming majority of terrorist attacks inside India are initiated by Pakistan.

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Although Pakistan is a sovereign nation and a U.S. ally, America has conducted targeted killing attacks inside that country2. The targets have been terrorists associated either with al-Qaeda or the Taliban; nevertheless, the violation of sovereignty cannot be ignored for it speaks volumes about the nature of the U.S.-Pakistani

relationship. Simply put, an international law analysis suggests the U.S. is violating Pakistani sovereignty. Whether that is justified---in the context of anticipatory self-defense— depends on an interpretation of the Bush Doctrine3 which establishes that nations harboring terrorists are legitimate targets. Pakistan must be viewed as presenting a tripartite threat—regional (India), terrorism (“hot-bed” for radicalization) and nuclear. Whether that justifies preemptively attacking Pakistan depends on the degree of threat posed by Pakistan and to whom. From a geopolitical perspective, Pakistan may well represent the most complicated—and dangerous—threat. On the face of it, President Obama has adopted the Bush doctrine. That said, the Pakistan dilemma requires decision makers, policy makers and commanders to determine the limits of self-defense with respect to multiple threats posed by one country. The nuclear threat posed by Iran has been much discussed and analyzed4. Nuclear physicists and intelligence experts suggest a “window of opportunity” exists to exert diplomatic and economic pressure on the Iranian regime to cancel the program. If the Iranians reject sanctions, then the critical question is when would a potentially “impacted” nation-state act in accordance with the principles of anticipatory self-defense? Whether it is the U.S., Israel, a combination of the two, or a third

nation-state is a matter of enormous speculation. While the Caroline Doctrine5 and Article 51 of the United Nations Charter6 articulate restrictive applications of self-defense I would suggest the Iranian dilemma wilbring to the fore application of anticipatory self-defense in its broadest sense. While there is, obviously, enormous uncertainty regarding “who, what, why, where and when,” an attack on Iran would not be beyond the realm of the possible. In the realm of the “unknown”, obviously, is the possible Iranian response to such an attack. The essence of geo-politics is weighing legal, political, policy and military considerations regarding both operational actions and possible responses.

Professor Amos Guiora teaches Criminal Law, Criminal Procedure, International Law, Global Perspectives on Counter-terrorism, and Religion and Terrorism. He is a Research Fellow at the International Institute on Counter-Terrorism, The Interndisciplinary Center, Herzeliya, Israel; a Corresponding Member, The Netherlands School of Human Rights Research, University of Utrecht School of Law and Has been awarded a Senior Specialist Fulbright Fellowship for The Netherlands in 2008. Guiora has published extensively both in the U.S. and Europe on issue related to national security, limits of interrogation, religion and terrorism and the limits of power. Prof Guiora is the author of Global Perspectives on Counterterrorism, Fundamentals of Counterterrorism, Constitutional Limits on Coercive Interrogation and Freedom from Religion. He served for 19 years in the Israel Defense Forces Judge Advocate General’s Corps (Lt. Col. Ret.). 1

http://news.bbc.co.uk/2/hi/south_asia/7161590.stm,

See “Guess Who’s Coming to Dinner” Martha Minow and Amos Guiora, Boston Globe, January 21, 2006, http://www.boston.com/ news/globe/editorial_opinion/oped/articles/2006/01/21/guess_ whos_coming_to_dinner/ 3

http://www.whitehouse.gov/nsc/nss.pdf

As examples see http://www.cfr.org/publication/8830/, http:// www.state.gov/t/us/rm/60254.htm, lhttp://www.time.com/time/ world/article/0,8599,430649,00.html 5

Afghanistan’s importance is manifested both in the continued presence of American forces and the resurgence of the Taliban which has clear regional implications. Admittedly there are many “ifs” in the Afghanistan discussion; it is perhaps the most “forward-looking” of the threats addressed in this essay. Because of its geographic reality—situated between Pakistan and

See http://findarticles.com/p/articles/mi_m1282/is_12_54/ ai_87130362, 6

http://www.un.org/aboutun/charter/,

Summit 2009

From Zero-sum Conflicts to Federalism: The Road Forward By Hiram E. Chodosh, Dean and Professor, and Chibli Mallat, Professor, S.J. Quinney College of Law

From Gujarat to Quebec, from Johannesburg to Jerusalem, from Kashmir to Kirkuk, our civilization faces a crossroads of historic magnitude. As a common, universal, social condition, we live in close proximity with peoples of diverse language, culture, religion, power over resources, and identity, often shaped by powerful historical narrative or recent experience of victimization by the other. We gain a sense of inspiration, place, and purpose from these identities; however, they also

Maintain the Status Quo As in physics, in the realm of seemingly irreconcilable conflicts, inertia is a powerful law, and we must recognize its force to minimize the effect of weak interventions and merely rhetorical commitments to justice, human rights, and peace. Yet the self-sustaining logic of conflict for groups who see killing the other as their only option, combined with disturbing availabil-

Regional Crises territorial units, however, is demonstrably flawed and ultimately offers no solution at all. Dislocation through partition has a disturbing past of immense violence, from Native American history to the Jewish ghettos, from the balkanization of the former Yugoslavia to the subcontinent’s partition of India and Pakistan. The separation of Israelis and Palestinians into hermetically sealed states or the break-up of Iraq into three separate nations may seem an attractive path to peace because this approach holds the theoretical promise of separating those engaged in heated conflict. However, partition does nothing to resolve the cycles of violence—at best, it merely suspends them for another opportunity to advance an unmet historical claim from forced dislocation. Partition ignores overlapping and intermixed conditions of identity and territory. The division of Iraq into three nations would hardly resolve the problem of Kirkuk, oil and gas, water, the rights of minorities, who would control Baghdad, and so on. And the two-state solution, while now nearly a conventional wisdom, does not alone determine civil and human rights for Arab Israelis in Israel or Jewish settlers in the West Bank. Partition is more likely to exacerbate historical conflicts than resolve them.

Political Condominia of Shared Powers: Federalism

carry a zero sum logic in which the mightier wins, and in which empathy for the other is viewed as a betrayal of oneself and one’s own kind. What are our options?

Conquest through Violence

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Historically, conflicts create justifications for the elimination of one people by another. Lemkin coined a phrase for this after WWII: genocide. Even though we have achieved normative agreement that genocide is a crime against our common humanity, legal commitments are weak against the underlying grammar of deep-seated conflict that has no political outlet or constructive form of expression through a shared political system. Without the creation of the latter, we can sadly expect the next Rwanda or Darfur to emerge, and we can hardly continue to sit on the sidelines or even rely solely on military interventions to put a stop to it.

ity of devastating military technologies, can only lead to catastrophe. As the means of destruction become more powerful, the likelihood of self-destruction in the futile attempt to maintain the status quo only becomes greater. In this sense, survival of the mightiest is a formula for mutual self-destruction. From the vantage point of Israelis, is it safe to assume that over time the Qassam rocket will remain the most advanced weapon of destruction to penetrate the Southern border? And from the Iranian point of view, is it reassuring to predict that Israel will sit back and merely passively observe the technological development of what it views as an existential threat?

Separation through Partition From the schoolyard to the battle zone, the temporal truce and division of enemies are attractive alternatives to the brutality of conflict. The more ambitious jurisdictional notion of dividing intermixed peoples into

Normative commitments to human and civil rights, peace and prosperity are necessary, but completely insufficient. Jean Monnet, the founder of the European Union, is reported to have said that every new idea is a bad idea before it can be implemented through an elaborating institution. From the differentiation of the township to the county or state, from the distinction between the province and the nation, the notion of federalism in the United States and the concept of subsidiarity in the economic and the political unification of Europe all reflect attempts to capture these vertical political strategies. Through these means, an Italian can be a European, a Quebecois can be a Canadian, and a Kurd can be an Iraqi. For those who are skeptical of this approach working in the context of highest conflicts, let’s take the inspirational, though fragile, exemplar of Iraq. Iraq presents the contemporary laboratory for the examination of pressing alternatives: conquest through violence or occupation, chronic sectarian violence and civil war among Kurds, Sunni, and Shi‘i, proposed political partition, and yes, implementation of vertically differentiated institutions under the rubric of federalism. This is not just a fanciful notion in Iraq today. Re-

markably, the Iraqi Constitution considers the country to be a Federation. Both the Preamble and Article 1 of the 2005 Constitution underline this fundamental characteristic; and the constitutional text refers to federation and federalism extensively in three of its six chapters. However, the second chamber of the legislative branch (a Federation Council) has not yet been developed, and the federal system in Iraq will not be completed without it. Without a Federation Council, the country cannot fulfill its own definition as a federal system as constitutionally mandated under Article 48: ‘The federal legislative power shall consist of the Council of Representatives and the Federation Council.’ This is at the heart of the discussion in Iraq, within the current constitutional revision process and in the country at large. By offering a territorial (and arguably sectarian and ethnic) balance to central power, federalism provides the most sophisticated constitutional instrument to hold the country together. Federalism is arguably the best institutional tool to reach solutions to hitherto intractable problems such as Kirkuk and oil, in addition to likely problems of water distribution and family law. A working federalism (advanced in part through the Federation Council) can resolve present and future constitutional issues of great importance to the country and in an institutional and systematic manner, rather than as an ad hoc political arrangement that renders most solutions, if reached, constantly elusive. The future of federalism in Iraq is not only important to the peoples of that country who have struggled over so many decades for human rights and peace. It is an experiment of consequential interest to all of us, from North America to Europe, from Asia to the Middle East, to see if a society riddled by sectarian violence can reject the undesirable alternatives of conquest, genocide, and partition in favor of a vertical political strategy and institution that accommodates self-determination with shared values and purpose. Professor Hiram Chodosh is Dean of the S.J.Quinney College of Law, University of Utah, and director of the Global Justice Project: Iraq. This is his personal opinion, which he contributed to the Daily Star. Chibli Mallat is Presidential Professor of Law at the University of Utah, and EU Jean Monnet Professor of law, USJ, Lebanon. He is senior legal advisor of gjpi. The authors are speaking here in their personal capacity.

Summit 2009

An International Agenda at a Time of Crisis

Envision

By Michelle Bernard, President and CEO Independent Women’s Forum and MSNBC Political Analyst

There may never have been a more critical G8 meeting. Leaders of the world’s most important industrial states are gathering as many nations fall deeper into recession and some teeter on the brink of default. The conflict in Afghanistan is growing more intractable, while North Korea is turning more hostile. Iran and Russia pose differing challenges, while Africa continues to suffer from poverty, disease, and misgovernment. There is so much to do. Unfortunately, it will be hard to agree to a specific policy agenda, but a broad consensus may become possible if participants start by focusing on larger principles. The leaders should be able to agree on the direction that needs to be taken, even if they disagree on some of the specifics. First, there should be no retreating from a market economy. Even Karl Marx recognized that it was the rise of capitalism that took impoverished societies from penury to plenty. We need better accountability and transparency in markets, but government can never substitute for the productivity of a free and open marketplace. Second, there should be no returning to the closed economies of the past. Protectionism is rearing its dangerous head in the U.S., Europe, and elsewhere around the globe. There has been much discussion of looking to the New Deal for remedies to today’s economic crisis. But a more relevant lesson is the role played by the Smoot-Hawley Tariff in turning a harsh recession in America into a global depression. Opening markets has benefited people the world over, and those gains must be preserved. Third, the greatest aid that wealthy nations can provide to the world’s poor is to create economic opportunities for Third World states and then to train Third World peoples to take advantage of those opportunities. Foreign “aid” for development has a dismal record, having done more to enrich corrupt elites than empower impoverished masses. Despite our current economic travails, what those at the bottom most need economically is the chance to be entrepreneurial and to succeed—both of which we in the West take for granted.

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Fourth, meeting the practical challenges of poverty and disease requires the cooperation of businesses, foundations, NGOs, and governments. No one gains from demonizing companies, which often provide the best practical means of achieving the ends we all share. If AIDS is cured, it will be by profit-making pharmaceutical firms. If today’s developing states join nations such as South Korea among the world’s economic elite,

it will be with the help of abundant investment and trade through Western multinational corporations. Fifth, education should top the agenda for promoting domestic and international economic development. Transformational technologies have created professional and financial opportunities that previous generations could only dream of. The world has shrunk as economies have grown more complex. Industrialized societies, like the U.S., have much work to do to educate their young to succeed in this new world. Poorer nations have even further to go, both in improving the quality of and access to schooling. Particularly important is ensuring that girls, minorities, and the very poor do not lose out to discrimination and prejudice. Sixth, problems will not be solved through the blame game. The U.S. and Europe sharply disagreed over the invasion of Iraq. Today many waste time trying to assign blame for the current economic crash. Although it is important to reflect on past mistakes to make right decisions in the future, we should look to the future rather than wallow in unhelpful recriminations over the past. Seventh, economic, environmental, and health problems require both cooperation and a nonpartisan balancing of competing interests. The need for international economic coordination must be compared to the danger of regulation by unaccountable bureaucracies. Concern over the impact of climate change must be contrasted with the importance of preserving economic prosperity. In spite of what the world media often parrots, the science of climate change is far from settled with many leading authorities now predicting a cooling trend instead of catastrophic warming. It would be a mistake to exacerbate existing economic challenges with rash, economy-crushing actions in the name of thwarting “global warming.” Eighth, a concerted international effort is needed to deal with the world’s hot spots. The U.S. cannot alone bring peace and stability to Afghanistan. The African states have been unable to create peace in Congo and Sudan, and defend democracy in Zimbabwe. Iraq’s future depends upon the behavior of its neighbors as much as upon America’s military performance. Neither Washington nor Europe has the answer for the multiple conflicts between Israel, the Palestinians, and Israel’s neighbors. Ninth, leading global players have a special responsibility to find peaceful means to resolve potential conflicts. Whatever the equities of the disputes between Russia and Georgia, China and Taiwan, and America and Iran, for

Summit 2009

Editorial instance, the price of war will always be high. Tragically, war is sometimes necessary. However, countries which aspire to international leadership must ensure that war truly is a last resort. Last, and perhaps most importantly, all participants in today’s interconnected global order need to take a long-term perspective. Peoples, companies, NGOs, and governments alike have an important role to play in meeting today’s challenges. But this crisis eventually will be just a distant memory. In addressing the problems of the present, we must be careful not to shortchange the future. The world looks much darker at the G8’s 2009 meeting than it did last year. But our nations have weathered economic depression and global war in the past. We can surmount the current challenges before us. However, doing so will require a willingness to cooperate and openness to new ideas not often seen at international meetings. This year more than ever we cannot afford to allow selfish politics to trump good policy. Michelle D. Bernard is an MSNBC political analyst and a Sunday columnist with The Washington Examiner. Bernard is the President and CEO of the Independent Women’s Forum and Independent Women’s Voice. Bernard is author of Women’s Progress: How Women and Are Wealthier, Healthier, and More Independent than Ever Before.

Summit 2009

Mercantilism or Meeting Demand? China’s National Oil Companies and Multilateral Diplomacy

Editorial 1 Luft, Gal. U.S., China Are on Collision Course Over Oil. LA Times Op-Ed, February 2, 2004.1.

By Tyler Anderson, Hinckley Scholar, University of Utah Hinckley Institute of Politics

2 Daniel,

Caroline. Kissinger Warns of Energy Conflict, Financial Times, June 2, 2005. 8.

Much has been said about the assertive, statist ideology that encourages Chinese petroleum firms to engage in unfair practices in international oil markets. Gal Luft, executive director of the Institute for the Analysis of Global Security and one of the most outspoken critics of China’s National Oil Companies (NOCs), put it thusly:

3 Downs, Erica. The Fact and Fiction of Sino-African Energy Relations. China Security, 3 (3), Summer 2007. 4 Alterman, Jon B. and Garver, John W. The Vital Triangle: China, The United States and The Middle East, Significant Issue Series, 30 (2). Center For Strategic and International Studies. Washington DC. 5 Rosen, Daniel; Houser, Trevor. China Energy: A Guide for the Perplexed. China Balance Sheet. Center for Strategic and International Studies & Peterson Institute for International Economics. May 2007.

“Sixty-seven years ago, oil-starved Japan embarked on an aggressive expansionary policy designed to secure its growing energy needs, which eventually led the nation into a world war. Today, another Asian power thirsts for oil: China…The seeds of what could be the next world war are quietly germinating.”1

are run by fewer than 150 staff member, many of which have close ties to the petroleum industry.11 Furthermore, even if the Chinese government had the bureaucratic capacity to leverage NOCs, there are political reasons why it cannot significantly manipulate them from engaging in anti-market (and hence non-profit maximizing) behaviors in order to accomplish additional policy objectives. Lee and Shalmon of Harvard’s Kennedy School of Government state, “The profitability of the state oil companies is critical to China’s efforts to meet its long-term energy security goals while supplying a significant percentage of the total revenues realized from the struggling state sector.”12 As the New York Times has recently reported, it seems that Chinese firms are more than willing to divest from their foriegn holdings if they feal they are in danger of being crippled economically.13

Henry Kissinger has also argued that competition for oil will be the driving source of international conflict in the near future.2 When viewed from afar, the current actions taken by Chinese NOCs may certainly look like a mercantilist grand strategy planned from Beijing in order to secure long-term oil concessions and strategic partnerships in rogue states (Syria, Iran, Sudan). However, that analysis is fundamentally flawed—instead, the international expansion of Chinese National Oil Companies is driven primarily by market factors, and not by government ideology or political calculations. This process is the logical reaction to Chinese domestic market pressures and supply shortages. 3;4 If anything, the Chinese government would prefer to remain self sufficient rather than depend on NOCs opperating in politically unstable countries where Western oil companies are forbidden to operate.5 Under Mao, energy self-sufficiency was once a centerpiece of Chinese energy policy.6 Even today the more internationally oriented NOCs often contradict domestic governmental preferences for increased spending on national infrastructure to “prop up” national oil fields like those in Daqing.7

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Unfortunately, the Chinese government faces a grim statistical reality: consumption is vastly outpacing domestic productive capabilities (BP’s statistical review of world energy reported that in 2007 China imported 3,277,000 barrels a day of crude oil and 834,000 barrels of refined petroleum),8 and the NOCs are hard pressed to find domestic or international sources of petroleum to meet this demand. Additionally, fuel subsidies further constrain NOCs by structurally incentivizing overseas expansion. Scholars Rosen and Houser from the Peterson Institute for International Economics contend, “With

limited opportunities to increase upstream production domestically and thin or negative margins on downstream activities because of price controls, Chinese oil companies have sought to boost reserve holdings, production, revenue, and clout by expanding overseas.”9 These factors, not political machinations in Bejing, compell expansion abroad. Equally important is that Beijing simply does not have the bureaucratic infrastructure to enforce such a mercantilist policy. Erica Downs, scholar of Chinese energy security at the Brookings Institute, argues: “Where many international observers see a carefully devised strategy for the acquisition of overseas oil and natural gas assets driven from the ‘top-down,’ Chinese analysts see chaos generated from the ‘bottom-up.’”10 In fact, the Chinese government (notoriously bottlenecked as it is) has no single overriding government body overseeing its energy policy; two of its largest offices, the Energy Bureau and the State Energy Office,

It is time we acknowledge China’s bilateral relationships with oil producing states are relationships defined by economics and not geopolitical posturing, especially as it opens new opportunities for international cooperation on issues of energy security. In fact, the Center for Strategic and International Studies (CSIS) and the US Government have both recently released papers arguing that China has begun to show just such flexibility.14;15 Steps toward this cooperation should include the addition of China in the International Energy Association (IEA) and addressing China’s fuel price ceiling and subsidies. Were fuel prices allowed to rise, demand for refined petroleum would slacken, thus reducing the rate the Chinese production/consumption gap is expanding. China already leaves a large footprint on the global energy market, and as Chinese energy markets continue to grow cooperation with China on energy issues becomes even more important. As NOCs continue to operate on the market conditions rather than politics, it is evident that policy steps can and should be taken to insure that China becomes a responsible member of the international energy community.

6 Zha, Daozjiong (≤È£¨µ¿æº). China’s Energy Security and Its International Relations. Third IISS Global Strategic Review, Geneva, 16-18, September 2005. Retrieved December 2008 www.silkroadstudies.org/new/docs/CEF/Quarterly/November_2005/Zha_Daojiong.pdf 7 Rosen

and Houser (2007). 22.

8 BP Statistical Review of World Energy, June 2008. 21. http://www.bp.com/liveassets/bp_internet/globalbp/globalbp_uk_ english/reports_and_publications/statistical_energy_review_2008/ STAGING/local_assets/downloads/pdf/statistical_review_of_world_ energy_full_review_2008.pdf 9 Rosen 10

and Houser (2007). 22.

Downs 2007. 47-48.

11 Rosen

and Houser (2007). 18.

Lee, Henry. Shalmon, Dan A. Searching For Oil: China’s Initiatives in the Middle East. The Enviroment. Harvard University Press, June 2007. 4. 13 The

New York Times. After Wall Street Losses, China Fund Said to Shift Focus. The New York Times Dealbook, Edited by Andrew Sorkin. February 20, 2008. http://dealbook.blogs.nytimes.com/2009/02/20/after-wall-streetlosses-china-fund-said-to-shift-focus/

14 Alterman,

Jon B. and Garver, John W. The Vital Triangle: China, The United States and The Middle East, Significant Issue Series, 30 (2). Center For Strategic and International Studies. Washington DC.

15 Kellerhals,

Mere D. US China Relations Show Progress. America. gov, 5/27/08. Retrieved from http://www.america.gov/st/peacesecenglish/2008/May/20080527135326dmslahrellek0.5858271.html

Tyler Anderson is an undergraduate student at the University of Utah in Economics and Political Science and he served a Hinckley Institute of Politics internship with the U.S. House Committee on Foreign Affairs.

Summit 2009

Harmful Transnational Activity: Principles for Coordinated Domestic Legal Responses

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By Chris Whytock, Associate Professor, University of Utah S.J. College of Law

Maritime piracy has recently made its way into world headlines. While piracy has existed for centuries, it has increased dramatically in the last decade and now causes billions of dollars of damage annually, according to a study published in the journal Foreign Affairs. Piracy is only one example of a wider phenomenon that confronts today’s world leaders: harmful acts committed by nonstate actors operating beyond national borders. Other examples include human trafficking, narco-trafficking, transnational terrorism, and cross-border pollution. Unfortunately, the international legal system is ill equipped to deal with these challenges. The system was built on the assumption that only states have rights and obligations under international law. To be sure, the emergence of human rights law and the advent of the International Criminal Court challenge this assumption and represent important steps in the development of the international justice system. Individuals now have limited but nevertheless important rights and obligations under international law. Yet compared to the magnitude of the transnational threats now posed by nonstate actors, the international legal framework for responding to those threats remains disproportionately weak. As a result, the legal response to the new rise of piracy has relied primarily on domestic rather than international institutions. Once captured, suspected pirates (if not released) have been delivered to domestic courts for trial. The United Kingdom and the United States have entered memorandums of understanding with Kenya whereby suspected pirates captured by the former can be tried in Kenyan courts. But for the most part, arrangements have been ad hoc. The international community’s responses to other types of transnational harms have also consisted largely of improvised reliance on domestic legal institutions. There are two basic alternatives to the prevailing approach. One is to establish new international courts to address challenges like these. However, world leaders should not rush toward that solution without carefully comparing the likely costs and benefits of formal international institutional initiatives to those of another alternative: well-coordinated and principled domestic institutional strategies. These strategies should be based on three key principles: effectiveness, fairness, and comity.

First, they should be designed to effectively reduce transnational harm by holding wrongdoers accountable and deterring future harmful acts. But the ends do not justify the means. Hence, the second guiding principle: fairness. Domestic institutional responses to transnational harms must follow procedures that ensure that suspected transnational wrongdoers are detained, tried, and (if convicted) punished consistently with international norms of due process and human rights. Third, these responses should be developed and implemented in accordance with the principle of comity: each country should develop and implement domestic responses in coordination with other concerned countries, taking into account other countries’ legitimate interests.

While formal international legal arrangements may often be optimal, policymakers should not automatically assume that this will always be the case. Domestic institutional responses—if well-coordinated and based on the principles of effectiveness, fairness, and comity— can also be appropriate. The essential point is that the character of particular transnational problems will determine whether the best legal responses will rely primarily on international, regional, or domestic institutional foundations. Moreover, history shows that even in the face of grave transnational threats, political realities often prevent countries from agreeing upon formal international institutional solutions. Even when not optimal, coordinated and principled domestic institutional strategies may offer the best practicable responses to many of the transnational challenges of our time. Dr. Christopher A. Whytock is an associate professor of law at the University of Utah S.J. Quinney College of Law, where he conducts research on transnational litigation, international law, and the role of domestic courts in global governance.

Summit 2009

Foreclosing on American Leadership

Editorial

By Christopher Peterson, Professor, University of Utah S.J. Quinney College of Law

One of the surprising things about the U.S.’ home mortgage foreclosure glut was how many different entities had a hand in sowing the seeds of tainted loans. It’s widely understood that Congress’ tax break on home mortgage interest created an incentive to shift consumer and medical debts into refinanced home mortgage loans. Moreover, it is not hard to see that the Federal Reserve’s sustained cheap money monetary policy through the 1990s and 2000s created tempting spreads between banks’ cost of funds and the promised yields on subprime home mortgage securities. But what may be less clear is how many government institutions had the legal authority to make changes that would have prevented—or at least moderated—the lending practices that caused the foreclosure crisis.

Trade Commission forgot to act. The American banking industry is made up of a complex hodgepodge of many different federal and state chartered institutions. In the U.S. there are federal banks, thrifts, and credit unions—all three of which have different regulators. And, these same types of institutions can be chartered by any of the fifty states—and regulated by more than fifty different state regulators, plus another federal deposit insurance watchdog of some sort. The Comptroller of the Currency (federal banks), the Office of Thrift Supervision (federal thrifts), the National Credit Union Administration, and all the other federal and state bank regulators had the authority to limit any practice that would jeopardize the “safety and soundness” of the financial industry. But none of them did. Perhaps the easiest target of blame was the dereliction of President George W. Bush—the leader of an administration that opposed virtually all regulation of any form. But, his failure cannot explain how the American judiciary—an institution that was supposed to act as a check and balance on the excesses of the political branches of government—sat on the sidelines while millions of fraudulent loans went undeterred. The custodians of the Anglo-American common law tradition never laid the strong hand of the law on mortgage broker kickbacks, “stated income” loans, or the commission hungry investment banks that passed on faulty paper to investors.

In 1994 Congress recognized that, in the wake of Reagan era banking deregulation, a new breed of “predatory” mortgage lenders had began taking advantage of naïve borrowers that had significant equity in their homes. In a tragically forgotten law called the Home Ownership and Equity Protection Act, Congress gave the Federal Reserve Board of Governors sweeping authority to issue regulations constraining abusive consumer mortgage lending practices. Basically, the Fed had the regulatory equivalent of a blank check that they never bothered to cash.

Summit 2009

But, it wasn’t just the Federal Reserve Board. The U.S. Federal Trade Commission has for generations had the authority to issue regulations limiting “unfair and deceptive” practices by many of the non-bank lenders that were the most reckless actors in recent years. In the past the FTC had been a leader in the American consumer movement adopting regulations that preserved consumers’ rights in retail installment lending and debt collections. But, somewhere in the subprime refinance frenzy, the Federal

It is not as though abusive and poorly underwritten loans were something new. Courts, bankers, and bank regulators have always dealt with this problem. What was different was that the home mortgages that came to clog America’s real estate markets with foreclosures and abandoned properties were bought, packaged, and sold to investors through a process known as securitization. Unlike past generations where lenders retained mortgages in their own portfolio or sold them to relatively well heeled government sponsored enterprises, private label securitization created a method of connecting one limitedly rational group, borrowers, to another, investors. All along the way a host of middlemen wet their beaks in a stream of commissions and fees little regard as to whether the loans actually made sense. But this recognition does not answer the puzzling question of why so many different government agencies and institutions so completely failed to stop such a large and—one would think—detectable problem? The answer may lie in the fundamental shift in the political power and prestige of those that profited from questionable lending. By enlisting world capital markets

and the most prestigious investment banking houses in the once-shady fringe lending business, securitization dramatically empowered the opponents of consumer protection law. In the 1980s and early 1990s, American academics generally referred to high-cost consumer creditors as the ‘fringe lending industry.’ The appellation invoked a picture, then accurate, of marginalized businesses that preyed on consumers by flying below the radar screen of law enforcement and the courts. But in the subprime home mortgage refinance glut, reference to ‘fringe’ lenders became a misnomer. The reason is not that fringe lenders went away, but rather that fringe lenders became capitalized and politically embraced by America’s most powerful financial institutions. It remains to be seen whether the United States’ government and the American people will learn one of the most important lessons of the financial crisis. Long overdue, America must adopt comprehensive legal reform of its consumer financial services system. Not just bailouts, America’s banks themselves need firm legal change. Failing at this will risk the permanent loss of international faith in not only American financial institutions and securities, but also American leadership.

Christopher Peterson is a Professor of Law at the University of Utah, S.J. Quinney College of Law, where he specializes in consumer financial services law.

Pandemic Flu: Preparedness in a Changing World

Editorial

By Secretary Michael O. Leavitt – Former Governor of Utah, Administrator of Environmental Protection Agency, and Secretary of the U.S. Department of Health and Human Services

Pandemics happen. They always have, they always will. They are a fact of biological life. However, discussing them presents a political and cultural dilemma. Anything one says in advance of a pandemic seems alarmist. Yet after pandemics begin, all preparations and warnings will seem inadequate. Periodically, a unique virus surfaces and swiftly diffuses across a non-immune population, causing widespread disease on a global scale. During the past five years, the H5N1 virus heightened the attention of the world to pandemic danger. While the virus continues to spread around the world among animals, no evidence has yet emerged that it will mutate into an efficiently transmissible human pandemic virus. However, if it is not the H5N1 virus that sparks the next pandemic, it will be another virus. Pandemics happen. Continual preparation is an imperative. World leaders must protect their citizens from the spread of influenza by working collaboratively to strengthen global prophylactic production and treatment capacity, provide and encourage targeted investments to productionready companies, and promote transparency vis-à-vis virus and vaccination information and ideas.

and healthy along with the old and infirm within days. The Spanish Flu was the most recent pandemic of historic scale, but others have since attacked with destructive consequences. Throughout two pandemic waves, the Asian Flu of 1956-58 maintained high infection rates among the so-called “transmitter population”— notably school-aged children—and killed between one and four million globally, including nearly 70,000 Americans. Later, as the mildest pandemic of the 1900s, the Hong Kong Flu in 1968 brought about around 33,000 deaths globally, likely mitigated by a moderately immune population and enhanced medical treatment. Though counteractants were developed quickly and further catastrophe preempted, unpreparedness and limited vaccine supplies likely exacerbated the death toll in each case. Most recently, the Avian Influenza (or H5N1s) that transmitted from infected poultry has killed hundreds with a more than 60% fatality rate since its detection in 1997. Although H5N1 is a new multiple-strain, influenza virus subtype and has contaminated and sickened many humans, it has failed to easily transmit and protract across humanity as viable pandemics must. Still, transmissibility remains a plausible and volatile prospect.

A Framework for Pandemic Preparedness Pandemics are a fact of biological life and experts predict that one will eventually occur and affect the entire international community. However, governments around the world are not prepared, nor can they resolve the crisis alone, but require assistance from corporate actors, community institutions, critical service providers, and others. As a result, it is essential for the international community to work collaboratively in implementing a pandemic preparedness agenda.

Pandemic Influenza: Historical Background

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During the 20th century, three pandemics occurred, triggering immense devastation to human life. The Spanish Flu of 1918 infected between 20 and 40% of the global population and killed more than 50 million people, including 675,000 Americans. These acute infections were not prejudiced and killed even the young

To contain an initial outbreak, plans must be coordinated between nations and their associated governmental entities and between governments and the private sector, with an emphasis on local organizations not wholly reliant on the federal government. Each nation at appropriate public and private levels should develop comprehensive strategies and contingency plans with primary aims to strengthen the capacity of the vaccine and antiviral industries, advocate public and private investment, and ensure transparency of information. A practical stockpiling and distribution countermeasure system maintained by health industries and supervised by national and local governments would provide critical and prompt vaccinations and medical supplies— such as ventilators, syringes, and intravenous antibiot-

ics—to people in any country at the outset of pandemic influenza. To accomplish this, it is necessary to bolster the vaccine industry by awarding contracts with substantial incentives to companies willing to build production facilities and generate sustainable and adaptable inventories.

tries collaborate (rather than compete) and produce viable vaccines from shared samples. Countries like Indonesia who want to hold H5N1 virus samples hostage by demanding payment need to reconsider their position and concede the fundamental principle that health risks outweigh intellectual property gains.

As with any remedy to global threats, a joint public and private investment scheme can sufficiently prepare against an attack. To deal with the relatively new H5N1 subtype, the U.S. teamed up with health technology companies to develop new cell-based methods of production and advanced dose-sparing technology to limit production constraints and lower vaccination costs. Due partly to these efforts, the U.S. has secured over 26 million doses of H5N1 pre-pandemic influenza vaccine and over 50 million antivirals. Existing stockpiles are made available to domestic health experts and foreign countries for clinical trials, case reporting, and rapid viral diagnosis.

Preparation is a Continuum

If pandemic influenza spreads within one geographic location, it becomes an economic problem and tangible threat to the entire world. Due to the potency of global economic interconnectedness, as pandemic influenza disrupts industrial or agricultural production in, for instance China, the effects are likely to cause setbacks in food trade and transportation routes everywhere. The rapid spread and variation of a deadly influenza strain accentuates the need for transparent information and virus sample sharing among nations. As demonstrated in the SARS flare-up of 2003, no one country owns the virus once it begins to spread. Such outbreaks are effectively managed when doctors from various coun-

Pandemic preparedness generates many ancillary benefits in that it prepares the world for other natural and manmade disasters. Preparation for pandemic influenza becomes a catalyst through which readiness against all categories of risk can progress and will establish innovative processes to combat all other global threats. Pandemic plans require active preparation for nonroutine emergencies and must be continuously adjusted to fit contemporary needs. If a pandemic influenza occurs anywhere, it is a risk everywhere. As nations, cities, communities, companies, and households prepare and pandemic readiness progresses, antivirals and vaccines will be allocated to everyone, not only the few. Global health is at stake, but more importantly, humanity is threatened and as global cooperation is achieved, the current generation could be the first ever prepared in the event of a pandemic outbreak. Secretary Michael Leavitt is the former Governor of Utah, Administrator of the Environmental Protection Agency, and Secretary of the U.S. Department of Health and Human Services. Acknowledgements: Rich McKeown and Andrew Jensen.

Summit 2009

Interview with His Excellency Klaus Scharioth Ambassador of the Federal Republic of Germany to the United States

Q: What are the major challenges and priorities for the German government at the upcoming G8 Summit? We support the priorities of the Italian Presidency. The G8 should send a clear signal of a common effort to overcome the global financial and economic crisis. We want to emphasize that the global economic downturn hits the poorest countries especially hard and that we must show solidarity. Another key issue is to mark the route to Copenhagen, i.e. plan the steps required to tackle climate change. Finally we want to focus on our cooperation with Brazil, China, India, Mexico and South Africa in what we call the “Heiligendamm Process”, an initiative taken by the German G8 Presidency in 2007. Q: In a speech at the Paris Conference, titled “New World, New Capitalism” Chancellor Angela Merkel said that: “The G8 is no longer the group that can create a global order for the world. Under Germany’s G8 presidency, we started, in what is referred to as the Heiligendamm process, to work together with five major partners—India, China, Mexico, Brazil, and South Africa—on a permanent and continuous basis within the OECD.” Does Germany believe that the G8 is closer than ever before to adding new members to the G8? How many more members should be added besides the five already mentioned? We witness the emergence of new actors like Brazil, China, India, Mexico and South Africa on the world scene. Germany initiated during its G8 presidency the so-called Heiligendamm Process in order to involve these major emerging economies in the work of the G8. The Italian presidency wants to continue and intensify this process; we support this. A real partnership with these countries is essential because we need to cooperate with them to solve the most pressing global problems (financial crisis, food security, climate change, energy and resource supply). It is my impression that these countries show readiness to shoulder responsibility, they are more and more open to acting together on issues of mutual concern. Therefore our aim is to continue and to deepen the dialogue with them. Discussions within the G8 regarding a possible enlargement process have just started. In any case: consensus among all G8 partners is necessary. Therefore it is too early to predict a precise outcome. Q: The Italian government has indicated that it intends to push for a fresh approach to African development by crafting a comprehensive strategy that treats African countries as equals and makes more use of NGOs and private sector actors rather than following the old top-down model of simply dispensing aid. Does Germany also embrace such an approach? The approach is not entirely new, in fact, the whole G8-Africa partnership and the Action plan have rested on this premise right from their outset. Various G8-presidencies, including the German one in 2007, have highlighted this philosophy in various ways. One of the issues at the G8 Heiligendamm summit in 2007 (Growth and Responsibility in Africa) was the strengthening of the private sector in Africa in order to promote growth and sustainable development. The Joint EU-Africa-Strategy, which was introduced during the German EU-Presidency in 2007, is another good example of a partnership amongst equals. Over the past 40 years, German development cooperation has relied on a close cooperation with nongovernmental organizations, from Germany and abroad. We value this partnership and will continue to channel a significant proportion of development assistance through NGOs.

Summit 2009

Q: The Italians plan to focus on ways to improve the security situation in Afghanistan. How does the German government view the situation in Afghanistan and does Germany plan to contribute

to helping improve security and building civilian institutions in Afghanistan? While living conditions of millions of Afghans have improved remarkably (health; education; water, energy and transportation infrastructure), Afghanistan is still plagued by violence and intimidation from the hands of an armed insurgency and extremist groups. The challenge of improving the security situation in Afghanistan is twofold. First, sustainable security gains will require building self-reliant Afghan Security Forces along with capable civilian institutions to guide them. Secondly, and equally important, Afghans must be convinced to firmly side with their government and support Afghanistan’s constitutional order which requires reducing the appeal of the economic and ideological recruiting tools at the extremists’ disposal. To this end, the Government of Afghanistan must be enabled to deliver basic services, economic opportunity and a sense of personal security and stability to Afghans throughout the country. In all of these endeavors, Germany closely and actively partners with Afghanistan. Germany has been NATO’s lead nation for the stabilization of Afghanistan’s north for almost six years. The German military presence there has greatly contributed to improved security, economic reconstruction and the establishment of civilian institutions. In fact, Germany was the first country to establish a NATO presence outside Kabul. German airlift and reconnaissance capabilities operate throughout Afghanistan. Overall, Germany is the third largest troop contributor to Afghanistan. The German contingent will grow this year from 3,500 to 4,150 to safeguard presidential elections. Germany is heavily involved in building a capable Afghan National Army (ANA) - with seven teams of military trainers and a pledge of 50 million Euros to the ANA Trust Fund. With a view to establish a capable Afghan National Police (ANP), Germany has deployed 140 experts, advisers, trainers and military police and funds the construction of critically needed police infrastructure such as headquarters and academies. In the field of civilian reconstruction, Germany is the fourth largest bilateral donor with an assistance total of over 1.2 billion Euros in the period 2002-2010. In addition, Germany accounts for 20% of the assistance provided by the EU for Afghanistan. That assistance amounts to 1,5 billion Euros in the period from 2002-2009. Striving to provide tangible improvements in living conditions for the Afghan populace, Germany is particularly engaged in providing energy, water, health, education, infrastructure (e.g. hospitals in Balkh and Faizabad, airport in Mazar-e-Sharif), mine clearance and counter-narcotics projects. In addition, Germany provides 22 million USD to UNDP to support Afghan national elections. Germany also helps build a capable Afghan justice sector and supports building administrative capacity through training and exchange programs. The German engagement in Afghanistan is part of a joint international effort with the G8 being one of many frameworks to coordinate within the donor community. We will use the G8 summit in Italy as another opportunity to jointly assess the situation in Afghanistan and to consult with partners on the way ahead. Q: In the midst of the global financial crisis, there are strong domestic pressures on governments to enact protectionist trade measures. What is the position of the German government on protectionism? In times of crisis, it is very tempting to fence off one’s own economy. From our perspective that would absolutely be the wrong answer. It only would lead deeper into crisis, as is shown by painful experiences in the past. For decades, we have all benefited together from the global reduction in trade barriers. Open markets and freedom to invest are the foundations for growth and prosperity world-wide. We therefore have to fend off protectionist tendencies vigorously. In this context, the German government, for example, paid very close attention in its own stimulus programme to ensuring that it does not give preferential treatment to domestic suppliers. Thank you Mr. Ambassador.

Summit 2009

Interview with His Excellency Pierre Vimont

Ambassador of France to the United States

Q: What are the most important priorities and challenges for the French government at the upcoming G8 Summit? I think there are three main priorities. The first one is the G8 collective response to the economic crisis. The G8 is a natural actor in this area. Since last November, the G20 has worked intensely to identify the root causes of the downturn and cope with its consequences including by improving the regulation of the financial system and stimulating a sound recovery, but we have to work in concert. The G8 will probably focus on the long term perspectives for recovery. We can come back to that later, but the economic situation is the first priority for the French government. The second priority would be the upcoming Copenhagen conference and the design of an ambitious and competitive international framework that will deal with climate change. This is of paramount importance. The third one is the question of development assistance particularly towards the most vulnerable in Africa, which is becoming one of the major challenges that the G8 is addressing. An overall priority in that context has to do with the G8 outreach towards emerging countries, and as I was saying previously, this involves some coordination with the G20. I think that there will be some discussions on how we are exercising the G20 process and how we organize relations between the G20 and the G8. I think it will be necessary for the leaders that prompted the G8 meeting to have a discussion on that and to see how things can be articulated. You know that for some time, there has been a tradition in the G8 to allow at one point that the eight countries that belong to the G8 meet with the five main emerging countries, Brazil, China, India, Mexico, South Africa and I think that this has already been planned in the G8 agenda in Italy. This outreach activity will have to be put into the context of the new G20. Q: Considering how popular the G20 summit in London was this year it seems like the G8 was a little overshadowed, if only for a moment. Do you feel that in the coming years we will see a revolutionary change between these two summits? We will have to see. It is true that France is very much at the forefront of the idea that the G8 cannot be kept with the present format. President Sarkozy has been very clear about that; he has been of the opinion for sometime now that the G8 should be transformed into a G13 with the five emerging countries I mentioned. In fact, at the time the financial crisis burst out with the Lehman Brothers bankruptcy in September of last year, he said that there should be an international group to deal with the issues that should be more inclusive than the G8. President Bush agreed to go forward and came up with this G20 format. Now the important thing as we go along is to see of and how we keep those two processes working side by side or if we should try at one point to simplify the way we proceed and coordinate our policies. Q: Of course no one has decided what the magic number will be for the Group.

Summit 2009

When you have left the G20 out of the box it is very difficult to say to some of the members to go back home and not participate anymore. But maybe at one point, once the economic and financial situation is getting better, the leaders in the G8 will be able to find the right figure in order to enlarge the G8.

Interview with His Excellency Pierre Vimont Q: We spoke about expansion and how France feels about it. I wanted to talk a little bit about the agenda that the Italian Presidency put forward. Italian Foreign Minister Frattini was in Washington a few months ago to discuss five focus areas for the summitâ&#x20AC;&#x2122;s agenda, which included development in Africa, non-proliferation, counter-terrorism, and the financial crisis which in itself is quite big considering the sub-issues of protectionism and trade. Do you feel that the agenda of the G8 has become too ambitious to tackle in a few days? Well, that has always been the case. If you look at the history of G7 and then G8 Summits you will see that for a three-day meeting they were able to get through many international issues. The G7 and the G8 meetings have always been much more than just meetings on economic issues, because when you have important world leaders in one single place, it is natural that they wish to evoke political issues on which they feel they can make some progress. Q: I have to agree with you on that I think there are about eight meetings so far scheduled with foreign ministers and financial ministers, so there is a lot of groundwork done before the summit. You have to remember that in fact the idea for the summit originally was to just have one day or one weekend talk in a very casual and informal way about economic issues. Quite quickly though, it became this three-day meeting of heads of state that turned into a long and well prepared process. Q: How does France view the situation in Afghanistan and Pakistan? We are very much in line with what has been stated by President Obama on the strategy towards Afghanistan and Pakistan. The fact is that Al Qaeda and the Taliban move from one country to another and you have to take into account this element if you want to find a sustainable solution to this conflict. Having said that, what we are trying to do is to be as practical as possible and to look at what the priorities are in both countries. If you look at Afghanistan, the important issues at stake are how to help and assist the Afghans in improving their institutions, training their security forces and equipping them to carry out their mission. We are also looking at increasing our technical and financial assistance to the central government but also to the provincial governments around the country. In other words, we are looking at helping the country and their local and national leaders to build up a viable state in all areas, from public health to justice or education and agriculture. We also have to work very closely with the Pakistani authorities so that they can mobilize to fight the Taliban. The priority there is to help the Pakistani army to be better equipped, to become more efficient in its fight against the Taliban. The current army is certainly a very efficient army but an army that has so far been mostly trained for conventional conflicts and not for those kinds of counter insurgencies and asymmetrical conflicts that we are facing today. Q: It is definitely a very sensitive situation for Pakistan. The Swat Valley for example is an area full of civilians that are being used by the Taliban as a shield. Looking at the reports that we have received, one can detect that the majority of the population seems to oppose The Taliban rule. They are very reluctant and have shown a lot of reservation towards the Taliban and I think that is something that we have to keep in mind. Thank you Mr. Ambassador.

Summit 2009

Yuishi Kimura

Summit 2009

Interview with His Excellency Ichiro Fujisaki

Ambassador of Japan to the United States Q: What are the major challenges and priorities for the Japanese government at this upcoming G8 Summit? Before we get into that point, can I tell you what the G8 is from my perspective. The G8 Summit is an annual health check up of our political and economic system. If we think of our system as an architecture, every year or all the time there are termites trying to bore into this structure. That could be in the political field, the proliferation of weapons of mass destruction or it could be terrorism. In the economic or social area, it could be a challenge to the market economy, a pandemic, or development issue. All in all, you can think of our system as a building, a construction, where the west wing is the political system and the east wing is the economic system. We always have to watch that this building is not attacked by termites, and accordingly, a regular health check up is necessary. That is the very essence of the G8 Summit, from that point you are coming up with very similar issues every year, and similar prescriptions as well. You address similar issues and also you are given similar prescriptions to not drink too much, to jog a bit, etc. So, I would like you to know that is the very essence of how I see the G8. This year this torch has been carried, passed on from last yearâ&#x20AC;&#x2122;s Hokkaido Toyako Summit in Japan. But there are other changes as well. A big change is that the world economy has met huge challenges since last year, so in our health check up that would be the first topic to be raised. Second or third would be the issues carried on from the last summit, environmental issues like climate change, the fight against terrorism, and the proliferation of weapons of mass destruction including nuclear. On top of that there are regional issues. Q: What are your thoughts on the G20? It seemed for a moment that the G20 Summit overshadowed the G8 Summit. The G8 is very different from the G20. The G20 is very important because it covers 85 percent of GDP of the world. As far as it addresses and copes with the global economy and financial issues today, the G20 is a very useful tool and I think all of us should utilize this as much as possible. But the G20 is not addressing proliferation, it is not addressing the flu pandemic, it is not addressing democracy, it is not addressing the development issue per se. On the other hand, the G8 summit covers not only ecoonmic and financial issues but also global issues such as the environmental issues, the fight against terrorism, and the non-proliferation issues. Therefore, the importance of the G8 summit is not undermined or overshadowed by the G20 summit.

Interview with His Excellency Ichiro Fujisaki

Q: I wanted to take you to the second priority of the G8 Summit this year, the climate change discussions and the Copenhagen discussions coming up. What are your thoughts on the issue? We think that climate change is very important. Our economy is one of the most energy efficient economies and we feel especially responsible because of the framework being started in Kyoto. However, Kyoto was not a great success because the U.S., China, and India were not there. You may already know that the U.S. and China each account for 20 percent of the emissions in the world. Japan accounts for just 4.3 percent. So, we are already doing a lot not to repeat this in a next framework on climate change. Q: Do you think that the Copenhagen meeting will be a much more positive meeting than Kyoto? It should be. The U.S. is much more positive and that is a hopeful sign. But it depends not only on the U.S. but other countries as well, especially emerging countries. And for that Japan and the U.S. have established a fund to assist developing countries for adaptation to climate change. Also Japan is implementing technical cooperation to developing countries. Q: I wanted to take you back to the financial crisis and what it does to trade. I know you mentioned quite a few things about the situation in Japan, do you feel that there will be more protectionism measures coming up as a result of the financial crisis? I donâ&#x20AC;&#x2122;t think so. Let me elaborate on my thoughts. Japan is dependent on foreign trade. If ever one goes protectionist, we are one of the first ones that will be hit the most. Our energy self sufficiency is 4 percent, our food self sufficiency is 40 percent. U.S. energy self sufficiency is 61 percent, U.S. food self sufficiency is 128 percent. The U.S. can survive on its own, Japan cannot. So we need foreign trade in Japan. We think that leading countries like the U.S. and Japan and others should not be caught in a psychology to protect our industry. That is exactly what happened after the great depression and countries went into the protectionist mode and started trade wars, which prompted the spirit stipulated in Article 1 of 1947 GATT in the aftermath of post WWII. This vicious cycle should be avoided with our firm commitment to promote global trade and investment and to reject protectionism. Thank you Mr. Ambassador.

Q: Italian Foreign Minister Frattini was in Washington in January and said that in a financial crisis where the whole world is suffering we shouldnâ&#x20AC;&#x2122;t let development ideas take the back seat. Would you agree with that?

I agree with that idea. Japan is trying to increase our development assistance in Asia as well. Of course there are two reasons that Asia should not be left behind. Asia is an engine for world development so we think that we have to put an emphasis on Asian countries. While the Japanese economy suffers the current situation more than those of the United States or Europe, in terms of GDP growth prospects, we think that we should live up to our commitment because we cannot spill this economic difficulty into developing countries.

Summit 2009

Stylex

Summit 2009

Think about the spirit of “ITADAKIMASU” 1. Rationale for establishing the class of “ITADAKIMASU”

Waseda University affiliated Waseda Jitugyo Elementary Course

Summit 2009

During her visit to Japan in February 2005, Prof. Wangari Maathai (69), Nobel Peace Prize laureate in 2004 met up with and was deeply moved with a word “MOTTAINAI” that has the spirit of the unique language culture of Japan. Since then she has been carrying on a MOTTAINAI campaign to spread “MOTTAINAI” as a “world common keyword” in every corner of the world to protect the environment. Prof. Wangari Maathai was awarded the Grand Cordon of the Order of the Rising Sun by the country of Japan through the Ambassador to Kenya in May of this year (2009). She said with joy that it is “very encouraging for her to continue to make efforts”. She then showed her determination to further promote her grass roots movement through environment protection. Ambassador Iwatani stated the reasons why she was awarded this Order were that she had contributed to globally disseminate the spirit of “MOTTAINAI” and introduced Japan’s efforts for addressing climate change. In addition to MOTTAINAI, Japanese language has many other words that have peculiarity to the Japanese language culture. From the perspective of the food culture, “ITADAKIMASU” is one of them. “ITADAKI” in “ITADAKIMASU” was originally the verb “ITADAKU” in a grammatical sense. When receiving a reward from a person of higher standing, or eating offerings made to Shinto and Buddhist deities, Japa-

nese people have deeply bent down their head, which has been practiced since the medieval times. “ITADAKU” has originally been a noble conduct of appreciation. Even in the modern times, a full of feelings of all the people concerned are embraced in the act of eating a meal. Eating animals and plants is nothing more or less than “a noble behavior of eating lives”. In schools, lively voices of “ITADAKIMASU!” are heard at lunch time. However, only fewer children than expected know the original subtext. They need to clearly understand the meaning of “ITADAKIMASU” and must be proud as a Japanese of the word created by our forerunners. In the field of education, we want to think of this word of weight with children without losing substance but to continue to inherit as a “living word”. On the basis of this, we as Japanese want to confidently introduce “ITADAKIMASU” to the world. 2. Class descriptions (1) 1st Lecture Coursework is conducted with all the children of 5th grade. Slides are used to let them know of Prof. Wangari Maathai’s campaign. With the information, they think of the word “MOTTAINAI”. While citing various “MOTTAINAI” movements around them, they make the class as the place to think of the movement in their position. (2) 2nd Lecture Coursework is conducted in each class. With the opinions exchanged during the 1st lecture, children think of its original meaning of “ITADAKIMASU”. Before closing the class, each child makes up a slogan to sum up the coursework. 3. From the look of the coursework (1)_1st Lecture A. The teacher s asked children to think of the situation in which they will deem it “MOTTAINAI” ‘in their daily life’. Children gave the following answers: _To do away with things that are

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still usable. _To run an excessive amount of tap water. _To consume too much tissue paper at a time. _Wasteful spending of money. _To leave an electric light turned on. _To leave food on the plate. B. Read to children a book “MOTTAINAI” about the word encountered in Japan, written by Vice Environment Minister of Kenya who received the Nobel Peace Price (published by Planet Link, Magazine House in June 2005). Then children were assigned to write their feedback on their notebook. Representative comments are given below: _There are poor people in the world. _In the future, try not to repeat MOTTAINAI things that I used to do. _It is shameful to hear that military expenditure is higher than the amount of money given to developing countries. _Instead of only we live a rich lifestyle, we better collect contributions. _If we bring a war to an end, the

number of people dying will decrease and then we can give money. _We must care for children. _I thought there were various types of MOTTAINAI in the world. _It is cruel and inhuman that a large amount of military spending is taken for granted. (2)_2nd Lecture A. The teacher asked children to think if there are any words of which Japan can be proud, other than “MOTTAINAI”. In reply to this, they gave the following answers: Arigatou (thank you), Magokoro

(sincerity), Ichigo-Ichie (meeting only once in a life time), Doryoku (make effort), Taisetsu (valued), Setuyaku (saving), Omoiyari (compassion), Tomodachi (friend), Iccho-Niseki (kill two birds with one stone), Kiryoku (mental toughness). B. All the students in the class thought of a slogan to introduce “ITADAKIMASU” to the people of the world. And each student wrote the slogan on a strip of sheet and put it up for display. Following are slogans: _ITADAKIMASU is a baton relay to support our life. _”ITADAKIMASU” is a set expression to thank for lives. Pronounce “thanks” (arigatou) from the heart. _”ITADAKIMASU” is a feeling of gratitude for having lives of other things. _Pronounce ITADAKIMASU. ITADAKIMASU with thankfulness. _Do not forget the spirit of ”ITADAKIMASU”! _”ITADAKIMASU” is …that saves lives. _Desire to make ”ITADAKIMASU” a world common keyword. _”ITADAKIMASU” with a feeling that we are having (Itadaku) lives. _Desire to spread ”ITADAKIMASU” globally. _For ”ITADAKIMASU”, a feeling of thankfulness is important. _Eat even one grain of rice if left. _The word to thank and respect for all. _Feel good saying ”ITADAKIMASU!!” _Value your life. _”ITADAKIMASU” is packed with lots of thankfulness. C. In finishing the coursework for thinking of the spirit of “ITADAKIMASU”, children were required to write their feedback down on their notebook to confirm what they learned from the one-shot course. Following are their feedbacks: _When I told to my grandmother and grandfather about this, they said that they had been told by their grandmother and grandfather to “cherish what you have, not leave rice on the plate.” I now think that I will eat up all

the rice served, use up a thing cleverly and separate recyclable things as much as I can. _Japanese people of today almost forget this MOTTAINAI, so I now think to value MOTTAINAI more.

_Poor children always tolerate their living standards, so favored children should not lead a life of luxury. Every grain of rice seemingly in a small amount is cropped with a lot of care given. I like to express my thanks to farming people by eating all the rice serviced in return. I have not thought of such thing till now. _ITADAKU means that we have (Itadaku) lives of others. They include cows, swine and vegetable and other various lives. By eating them, we grow in height and feet, and become healthy. So, we must say thanks to these animals. But the people who raised animals and plants are not here, so say ITADAKIMASU with a feeling of thankfulness to the animals and the people involved. I am happy that I could have time today to think it over. Because I have done this today, I will be able to say “ITADAKIMASU” seriously. _I practice some things. I accept and give hand-me-downs. My school slippers are also hand-me-downs. The ones that become small for me will be handed to my cousin or acquaintance. I now understand that although I think I live frugally, it is a life of luxury to the people of Africa. I will exercise saving as much as I can. _I thought that there were many good people among the Japanese. This is because they have the thankful mind. I used to say ITADAKIMASU

without knowing the meaning, but from now on, I want to say it wholeheartedly. _I want to spread ITADAKIMASU together with its meaning to the people of other countries in the world. Then, leftover food might be reduced. If leftover food is reduced, many people could be saved. To make such a world, I wish many more Japanese people desire to globally spread this phrase. As was expected, people in old days are great!! _I think only six letters (when written in Japanese) can convey the joy and appreciation to those who raised them. _Some lives must be lost. Otherwise, humans cannot survive. When I think of this, I feel very sorry for them. Indeed our lives can be sustained and our lives are nurtured in this way. _I thought ITADAKIMASU was very important. I like to share my meals with those who cannot afford to have meals and are going to die. Pork, beef and chicken meat are delicious but we must ITADAKU their lives. Otherwise, we will not get our food. So, Cows, swine and poultry are raised with care. When we say ITADAKIMASU, say it with thankfulness to all involved in providing food. I have said it without a thankful feeling, but from today I will say it with feeling. _I have not said ITADAKIMASU with much feeling, but I now say it with feeling to all the people who made the lives and food as I studied on ITADAKIMASU. Lastly I would say that I want to study on the ITADAKIMASU again.

Summit 2009

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Hyatt

The Last Ark Called Survivability by J. B. Kabua Marshall Islands Ambassador to Japan

There is a saying that in every event in human affairs, including sea level rising and its predicted calamity, there is an opportunity of creativity. The immensity of Nature’s force on the human habitat arrives slow but can also take the unprepared by surprise. The opportunity of creativity presented by sea level rise has actually arrived. But its seascape and physical future belongs to the survivor. Profile of author: current Marshall Is. Ambassador to Japan served over 25 years(public policy), critic, loves politics, classic music and philosophy, issue writer (essayist), boat/canoe builder; interested in fish industries Marshall Islands Freindship Associates

And who might that be? I define this person or persons as those who are interested in reading the “ark’s drawings” and willing to assemble the keel, ribs, rudder, etc. that have been precut, laid before you, and ready to be assembled into a condition for human survivability. The debate on whose policy and way of life inadvertently destroyed another man’s way of life and culture is finished long time ago. There is no more time for playing the “blame game” or the “look for sympathy” overture. Instead, let us recognize and act quickly on the new reality: that an opportunity to change the social structure, the law of the land, and to create new wealth, etc. has arrived. I therefore propose this action for the survivor of the future (for the sake of others). Will you help create wealth through economic cooperation that I will design to assure equitable profit sharing with a nation whose way of life has not created its own wealth and predicted to be a victim of sea level rise? Will you help create a trust fund exclusively for defraying the cost of migration, relocation and resettlement? Would you be interested in the management of extensive coral reef systems and ocean regions and their resources? Let’s connect at e-mail: camelot_pi@hotmail.com

NEXT GENERATION Noah Tartan Kabua, 14, son of ambassador: “If this thing were to happen tomorrow, l think I will be okay, because there are good people who will help”.

Yoshio Tanaka, 15, resident of Tokyo: “I think there is enough land to welcome Pacific islands people who must migrate. I think there is good chance to discuss exchange arrangements. But this is a very difficult problem.”

Hideaki Yasuda, 29, Kyoto resident: “Some planning by the people must be done. Politicians are usually good in understanding this kind of problem. Who looks after the islands area under the sea is very interesting. I think many fish will come there and many businessmen will like to go there to get the resource. But I do not know when.”

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Changing Ways Record high oil prices in 2007 and 2008 prompted businesses to re-think one of the basic tenets of logistics in times of globalization: produce in low-cost countries and transport to home mar-kets. Within a short period of time and based on the understanding that high oil prices are here to stay in the long run, major international players such as fashion retailer H&M and Sharp began to buck the trend of globalization. In what seemed a counter-intuitive move, the companies actually made rational, pragmatic calculations and moved

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aside. Companies that stick with it know that sustainable business practices and environmental focus lead to innovation and a strong market position – a position that can be maintained for the long haul.

Focus on Sustainability

Given the economic imperative to handle natural resources, such as oil, efficiently, as well as a focus on sustainability and the environment, logistics providers and their customers are examin-ing how to optimize global freight

carbon efficiency of the Group and its subcontractors by 30 percent by 2020. Within GoGreen, Deutsche Post DHL is doing so by optimizing the fleet of vehicles and aircraft, improving energy efficiency in the buildings it operates in more than 220 countries around the world, focusing on the development of innovative technologies at its DHL Innovation Center close to the headquarters in Bonn, Germany, and involving its approximately 500,000 employees as well as its customers and suppliers. In the area of freight, DHL is also working to reduce emissions. It is developing intermodal trans-port, re-thinking basic logistics concepts, optimizing its fleet and training workers to be more en-ergy efficient.

Intermodal Transport: Reducing the Impact on the Environment

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production closer to their customers while looking for ways to make logistics more e f f i c i e n t . They wanted to maximize profits and cut the carbon emissions for which they were responsible, thereby boosting their standing with investors and customers alike. Even as oil prices have tumbled due to the financial crisis, the pressure remains on companies to do their part for the environment. Hence, the process of re-thinking logistics operations hasn’t slowed or reversed in 2009. Companies continue to look for ways to trim logistics costs and make logistics processes more efficient . In fact, sustainability analysts say that tough economic times will prove a watershed for corporate environmental efforts. Those companies that are seri-ous about sustainability and the environment will continue their efforts while organizations that only gave lip service to them will quickly brush their projects

transport. They are not only moving production locations, they’re considering how to pack goods more compactly, use transport containers more efficiently, buy from local suppliers to cut down on transport kilometers and use a variety of modes of transport. Hermann Ude, CEO of DHL Global Forwarding and Freight, said, “In the area of Global Forwarding, we have been thinking about the environment as a top priority for quite some time.” Deutsche Post DHL, the world’s largest logistics company, was the first company in the industry to come forward and acknowledge its responsibility for greenhouse gas emissions. As the basis for worldwide trade, the logistics industry contributes considerably to global carbon emissions. To acknowledge the fact, assume responsibility and begin to change practices in the logistics in-dustry, Deutsche Post DHL has launched an own climate protection program called “GoGreen”. It focuses on improving the

What produces lower emissions and costs less than air transport but is quicker than sending cargo by sea? The answer: a combination, or intermodal transport. Intermodal transport is one of the most exciting topics in the logistics world. Logistics providers can help their customers save time, money and cut down on carbon emissions by intelligently combining transport by ship, plane, rail or truck - as long as the transfers are organized efficiently. The European Intermodal Research Advisory Council (EIRAC) estimates that the share of intermodal transport in all goods transported in Europe will increase to 40 percent by 2020. Deutsche Post DHL has a sophisticated offering of intermodal transport options. For example, goods destined from China for countries such as Tanzania, Angola and Nigeria can be sent us-ing the SeAir service. Transport time by sea for mobile phones, clothing and computers, as well as technical equipment to support the booming telecommunications sector, would take 32 days. By combining air and sea transport by transferring the goods

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in Dubai, the SeAir tariff allows producers to cut transport time by 50 percent, reduce costs about the same and reduce emissions. Dubai is already a key shipping center, but capacity will expand greatly as the country builds the Dubai World Center. It will be the world’s largest logistics platform, setting standards for intermodal transport. The region could become the first fully integrated logistics network in the world when construction is completed in 2015. Deutsche Post DHL is expanding its presence in Logistics City, a part of the Dubai World Center.

Cutting Costs and Emissions with Modal Shifts

Deutsche Post DHL has a strong track record in developing intermodal logistics concepts. In 2005, the company began running a so-called block train from Lübeck/Travemünde in Germany to and from Verona, Italy. It was the first pan-European logistics company to offer scheduled transports with trains pulling trailers and conventional freight wagons. The advantages were clear: The shipments by train were more timely than those by truck, costs were decreased and carbon emissions were reduced dramatically. More than 130,000 tons of goods are forwarded by train and not by truck as previously. Emission were reduced by 70 percent, the equivalent to 15,000 tons of carbon dioxide per year. “Our customers are continuously asking for environmentally friendly logistics solutions given rising transport costs and limited resources,” said Hermann Ude. “By further developing these solutions we are meeting our customers needs.”

New Logistics Concepts

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Deutsche Post DHL sees it as part of its job to re-think logistics processes. The company is doing so in ways big and small, including the development of intermodal transport. But in the long run, limited oil resources will require fur-

ther changes in logistics practices. For instance, compa-nies may be forced to reconsider what was universally seen as a good business practice: avoid-ing high inventories. Producing “just in time” means that goods are produced and delivered ex-actly to the point when needed, without storage in between, even if that meant the transport of goods takes place in vehicles that are only half full. Given the outlook for high, long-term oil prices, the concept of just-in-time delivery may take a back seat in new logistics strategies. Companies may begin to have fuller warehouses, a development that would mean fewer deliv-eries and fewer rush deliveries, and hence a better use of capacity on trucks and ships.

Deutsche Post DHL works constantly to optimize loads and routes. In its DHL Innovation Center, it is developing intelligent transport routing systems that make use of current traffic data, satellite-supported navigation and current orders for pickups and deliveries. It combines this information to reduce unnecessary trips and reach maximum possible capacity use, thereby saving fuel and reducing emissions. Furthermore, the company is replacing its fleet of aircraft and ground vehicles with a focus on fuel efficiency when possible. In Sweden, for example, more than 40 percent of the DHL fleet uses alternative fuels, and the company plans in the next years to replace all the vehicles it owns with more environmentally friendly models. But also supposedly “unimportant” measures, such as driver

training, make a significant contribution. Considering the total number of kilometers that DHL workers around the world drive each day, fuelefficient driving practices can make a big difference overall.

Climate Protection Program GoGreen

“Deutsche Post DHL is not thinking just about the current financial crisis. We’re positioning our company for the long term and in a sustainable manner. We know that it’s critical for our custom-ers and for the environment that logistics companies help improve efficient transport. Our activi-ties in this area build trust with our customers, employees, investors and contractors. They know that we think for the long term,” said Hermann Ude. Launched in April 2008, the GoGreen pro-gram has kicked-off successfully and is constantly developed further. With its GoGreen offering, Deutsche Post DHL gives companies and individuals the chance to lower their carbon footprint. For instance, business customers sent some 5.5 million GoGreen packages and more than100 million climateneutral letters in Germany in 2008. In the U.K., DHL began to operate the first climate-neutral distribution center in November 2008. It heats itself by extracting warmth from 8 kilometers of pipes that run through the building. Even if the ground is frozen, the temperature above it stays constant throughout the year at 12 to 14 degrees Celsius. Other examples: At the DHL Express hub in Leipzig/Halle, energy efficiency was built into the architecture. The building participates in a communal power station. The ceiling is outfitted with 1,000 square meters of solar panels, and DHL is able to contribute 100,000 kilowatt hours to the public electricity network. In addition, the company collects rain water for cleaning toilets and washing planes.

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CARING FOR THE CAREGIVERS When measuring of the significant weakness of healthcare infrastructures in the sub-Saharan African region, few numbers stand so starkly as those quantifying the vast undersupply of healthcare workers present to serve local populations.

lion nurses working worldwide. Soon, such high-profile players on the global health scene as BD (Becton, Dickinson and Company) and PEPFAR (the US President’s Emergency Plan for AIDS Relief) rallied around the concept.

Health care workers chatting in the reception area of the Swaziland Wellness Centre.

The sub-Saharan Africa region, for example, bears 75 percent of the world’s HIV/AIDS burden, yet employs only three percent of the global health workforce.

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and a increase in unemployed health workers as funding for established posts disappeared. Illustrating the “brain drain” affecting the region’s healthcare sector, only 360 of the 1,200 physicians trained in Zimbabwe during the 1990s were still practicing in the country as of 2001.

Swaziland Wellness Centre receptionist and administrator Faith Dlamini welcomes a client at the Centre.

Global health advocates concur that this dire shortage of health workers is the one of the most fundamental health system challenges facing Africa today.

These facilities have opened the door to improved retention practices, better health, and an increased sense of being valued for the African health workers who toil daily on the front lines of the battle against HIV/ AIDS, TB and other infectious diseases.

In the 2002-2003 period, more than 3,000 nurses trained in South Africa, Zimbabwe, Nigeria, Ghana, Zambia and Kenya registered in the UK. And Ethiopia’s public health sector is losing nearly ten percent of its physicians every year, primarily to other countries and to the private sector.

An under-supply of health workers

But there is new hope in the form of several recently established “Wellness Centres for Health Care Workers®” in Swaziland, Lesotho and other sub-Saharan nations with fragile, understaffed healthcare systems.

In Uganda, only 29,000 health care professionals serve a population of 30 million people. And in Malawi, according to 2006 data compiled by WHO, only 25 nurses and one doctor were available for every 100,000 patients.

The centres were originally conceived by the International Council of Nurses in collaboration with its member national nurses associations (NNAs) in sub-Saharan Africa and with support from sister NNAs in the North. The International Council of Nurses (ICN) is a federation of 132 national nurses associations representing the more than 13 mil-

Contrast this to the United Kingdom, where every 100,000 patients have the opportunity to avail themselves of the services of 937 nurses and 256 doctors.

Making matters worse, the relatively few health workers on the scene function under hazardous working conditions and experience a high prevalence of infectious disease, especially HIV/ AIDS, tuberculosis and malaria. Those who contract an infectious disease face the same treatment access challenges as the general population. In addition they are reluctant to queue with their patients for services and treatment.

Massive under-funding of national healthcare systems contributes to a steady exodus of heath workers from sub-Saharan Africa

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“Wellness Centres help keep health workers healthy, in their jobs and in their country, ” says David Benton, Chief Executive Officer of ICN. “The Centres also deliver the powerful message that health workers are valued and cared

for. By stabilizing the local healthcare workforce, these centres play a critical and strategic role in strengthening overall healthcare systems in developing countries.” “The nature of the work done by health workers--especially those

cians report that being treated in the same facility as one’s patients undercuts their effectiveness as caregivers. “If healthcare workers were infected with HIV, they would have to queue alongside their patients for treatment,” Masitsela Mhlanga, former president of the Swa-

Nurse Counsellor Selby Sukati is proud to serve his colleagueclients at the Swaziland Wellness Centre.

The immediate family members of health care workers are also welcome at the Centres.

who are in touch with patients 24 hours a day -- exposes them to stress, depression and various infections that, if not attended to immediately, affects their health grossly,” says Ugandan Commissioner for Health Services/Nursing Margaret Chota. “Many health workers are sick but cannot access healthcare easily.”

ziland Nurses Association, told The Lancet last year. “So today, you are a patient and tomorrow you are a nurse or clinician. The health workers felt undermined and they were losing their authority and the confidence of their patients. They would be stigmatized.”

Sub-Saharan nations are thus experiencing a large and steady decline in the number of already scarce health workers due to death and disease, underinvestment and poor retention practices.

To protect the health of healthcare workers and to promote their retention, ICN and the Swaziland Nurses Association created the first Wellness Centre in Swaziland in 2006. The Lesotho Wellness Centre followed in 2007. BD (Becton, Dickinson and Company) created a partnership with ICN in 2007 to expand and establish Wellness Centres for Health Workers in various countries in sub-Sahara Africa.

Overstressed and undervalued Dysfunctional work environments contribute to the problem, too. In regular consultation with its members in sub-Saharan Africa, ICN found that a primary “push” factor motivating health workers to migrate is that they feel overstressed and undervalued. Furthermore, nurses and physi-

healthcare systems in developing nations through technical training and support, expanding access to appropriate diagnostic and other medical technologies, and investing in new products suitable for use in these settings. Excited by the promise held

The Wellness Centres emerge

BD is a leading global medical technology company that develops, manufactures and sells medical devices, instrument systems and reagents. The company’s Global Health Initiative works to strengthen

forth by the Wellness Centre for Health Care Workers® model first launched by ICN, BD alerted PEPFAR to the significant potential of this innovative, workforce retention resource. This subsequently led to an October, 2008 agreement whereby PEPFAR joined BD and ICN as a collaborator in support of the Uganda facility. A number of additional partners have been working with ICN, BD and PEPFAR to establish, develop and sustain Wellness Centres. These include: the Stephen Lewis Foundation; the ministries of health in implementing countries; the national nurses associations of Swaziland, Lesotho, Uganda, Malawi, Zambia, Denmark, Sweden and Norway; the World Health Organization; the Rose Foundation; and Nurses SOAR of Georgetown University. “Health care workers are the foundation of a health system,” said Gary Cohen, BD Executive Vice President. “By addressing the fun-

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Thabsile Dlamini of the Swaziland Nurses Association waves from the entrance of the Swaziland Wellness Centres for Health Care Workers in downtown Manzini, Swaziland’s largest metropolitan area.

A student nurses assists the president of the Lesotho Nurses Association in unveiling the sign at the official opening of the Lesotho Wellness Centre for Health Care Workers in Maseru, Lesotho.

damental needs of healthcare workers, such as protecting them from occupational hazards and providing medical treatment when needed, Wellness Centers strengthen a country’s capacity to serve patients. “By working in partnership with ICN and PEPFAR in support of the centres, we believe our company stands at the forefront of the most fundamental issue affecting health systems in Africa,” Cohen added. “This kind of social investment delivers unusually far-reaching results. For example, the Swaziland centre has the capacity to reach the country’s entire healthcare workforce.”

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Managed by nurses and supported by inter-sectoral partnerships, centres provide a number of dedicated services for health workers and their families, including HIV and TB prevention, treatment and care in a discreet setting, psycho-

logical counselling and stress management, and occupational safety training and professional training.

HIV prevalence rate, the highest in the world. National life expectancy is 32 years.

The facilities serve as a knowledge and training centre for continuous professional development, and also provide grief-related services. Health workers receive training in disease prevention through needlestick injury surveillance and immunizations for healthcare workers, as well as post-exposure care.

The centre’s land and building were provided by the Swaziland Nurses Association. The site – the first of its kind in the region – is accredited as an official antiretroviral therapy (ART) facility.

Centres presently operate in Swaziland and Lesotho. Facilities are scheduled to open in Zambia, Malawi and Uganda this year.

Swaziland: The first Centre The Swaziland Wellness Centre for Health Care Workers – which opened in September 2006 – is situated in a country with a 26 percent

Thanks to additional support through PEPFAR, the Swaziland program also supports mobile outreach to health workers situated in remote, rural areas. The global health community has been highly encouraged by the results of the Swaziland centre to date. According to its most recent report, the site has served 6,225 health workers, a figure equal to 77 percent of the country’s total health workforce.

The centre launched a TB and MDR-TB training program for nurses, and also provides HIV and TB training for support workers including kitchen, maintenance and cleaning personnel. Swaziland also started hepatitis B immunizations for healthcare workers and has been conducting pubic education programming via radio broadcasts.

workers. More than 200 have received a variety of critical training including in post-exposure prophylaxis, management of TB and MDRTB, resilience for children below the age of 18, grief and loss, and behavior change and communication skills.

As one of the most promising outcomes to date, the president of the Swaziland Nurses Association reported no cases of nurse migration during 2007.

Work on the structure for the Zambian Wellness Centre for Health Care Workers was completed in November 2008. The site will also receive PEPFAR support for mobile outreach to remote locations. The centre is scheduled to open later this year.

The Centre in Lesotho Situated in a nation with a 23 percent HIV prevalence and 35-year life expectancy, the Lesotho Wellness Centre served its first client in November 2007 and hosted a formal opening in April 2008. Like the Swaziland facility, the centre is accredited as an official ART site and receives PEPFAR funding for mobile outreach to workers situated in outlying areas. Since its opening, the centre has served more than 2, 338 health

Three more in the pipeline

The Malawi Wellness Centre for Health Care Workers is now under construction and also set to open towards the end of 2009. And groundbreaking for the Ugandan Wellness Centre for Health Care Workers occurred in October 2008 with an opening scheduled for the fourth quarter of 2009. PEPFAR funding will underwrite a significant expansion of the Uganda centre over the next three years.

“The next day it starts all over again” The centres’ initial successes reflect the high-functioning teamwork among ICN, BD, PEPFAR and other collaborators. And clearly, numbers and epidemiological statistics help to inform us about the vital need for Wellness Centres, their initial successes, and the tremendous promise they hold. But some impacts cannot be measured in numbers. The venues should also be viewed as a place of refuge and sharing for people engaged in work that is physically, psychologically and emotionally demanding. “You accompany a patient through all the stages from diagnosis to death and when they die, you feel like you have died,” Masitsela Mhlanga told The Lancet. “Then the next day it starts all over again with new patients. We all need a place to share our experience.”

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Muskoka is a great destination, even if you’re not a world leader Muskoka gets ready to meet the world Canada’s Muskoka counting down to 2010 Key global issues and the opportunity for face-to-face discussions among the leaders of the world’s major industrial nations are the substance of the G8 Summit. But after the communiqués are complete, it is often the striking settings of these annual retreats, captured in the requisite photo calls, that remain imprinted on public memory.

LOCATION, LOCATION

Picture the stately white halls of Heiligendamm, the swaying palms of Georgia’s Sea Island, Hokkaido’s serene mountain top, or Gleneagles rolling greens. In 2010, yet another postcard location will join that list of international hot spots. The Government of Canada has already selected Muskoka, and its landmark Deerhurst Resort, as the venue for its fifth turn at hosting the event, from June 25 to 27 next year Situated just two hours north of Toronto, Canada’s largest city, Prime Minister Stephen Harper dubbed it “a jewel in the Canadian Shield and an ideal location.” This 2,500 square mile region of 1,600 lakes, granite cliffs and maple forests is no stranger to globetrotting, high profile travelers either.

STEAMSHIPS, TRAINS & AUTOMOBILES

Once the summer preserve of wealthy industrialists, Muskoka has drawn visitors from far away places like New York, Pittsburg and Philadelphia since before Canada became a country.

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Sponsored Article First sportsmen’s clubs, followed by families, would arrive by train and then board steamships that dropped them off for extended stays at the region’s growing number of lakeside inns. Founded by a transplanted Yorkshire man intent on providing “firstclass English service” back in 1896, Deerhurst itself has evolved from a rustic 18-room lodge, where on start-up a week’s accommodations cost $3.50 per person including meals, to a modern 400-room hotel and conference centre, renowned for offering the most on-site activities of any resort in Eastern Canada.

OH CANADA

A fixture of what is known nationally as simply “cottage country,” it has become a low-key icon of Canadians’ collective love for the rural weekend retreat. And much of Deerhurst’s 780 acres are designed with outdoor relaxation in mind, from mountain biking and horseback riding trails to parasailing, paintball and, once the snow flies, classic northern pursuits like snowmobiling and dogsled rides. Deerhurst and the region’s hundreds of travel-oriented businesses are also fortunate to be surrounded by other touchstones of Canadian life and culture This is the very landscape that fueled the country’s best known artists, the Group of Seven. The resort’s vibrant hometown of Huntsville and a string of neighbouring waterside communities have retained an enviable balance of main street charm and thriving industry.

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And the region encompasses nearby Algonquin Provincial Park, an accessible yet unspoiled Ontario wilCont. p112

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Sponsored Article derness playground that has inspired Canadian success stories from prime ministers to musicians and the founders of the internationally fashionable Roots clothing brand.

TAKING CARE OF BUSINESS

While Muskoka continues efforts to diversify, tourism remains a pivotal draw. And even play is serious business at a property that has put itself on the map by hosting annual events like the world’s largest pond hockey championships and an Ironman 70.3 race. Over the past two decades, Deerhurst has strategically expanded its business beyond peak summer leisure traffic into a full-service, 40,000 square foot conference facility known for its on-site teambuilding program, turn-key themed events and top-level meetings. “And the Summit is, in essence, the biggest, most important small executive retreat on the planet,” noted Deerhurst General Manager Joseph Klein.

GREENS & GARDENS

Another big draw for the corporate crowd, as well as vacationers, is Muskoka’s emergence as a major, top level golf destination. Deerhurst was the forerunner, building the highly playable, par-72 Robert Cupp and Tom McBroom designed Deerhurst Highlands in 1990 to flow harmoniously around the rugged and craggy landscape. Today, it has been joined by seven more prime resort courses, not to mention the area’s many other longterm favorites including Deerhurst’s own second 18-hole course, Deerhurst Lakeside.

Deerhurst’s kitchens also put its golf course areas to good use, foraging for edible ingredients served in the resort’s seasonal dishes.

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A founding member of the region’s Savour Muskoka culinary trail, Deerhurst is North America’s only resort that produces both maple syrup and wildflower honey on its own grounds as well as growing its own supply of herbs, composting all its green food waste and fueling the resort’s back country Hummer tours with biodiesel recycled from its used frying oil. The resort also works with about 20 different local food suppliers, showcasing, like a dozen more area chefs, small business partnerships and what can be successfully produced in a relatively short northern growing season. It remains to be seen if the Japanese Prime Minister will have an opportunity to feast on Deerhurst’s third shiitake mushroom harvest grown on recycled oak logs.

get people together to share over a dinner table the world suddenly seems a lot smaller,” he laughed.

COUNTING THE DAYS

While the eyes of the world and the needs of its ultimate VIP guests come inherent with plenty of challenges, Deerhurst’s staff is steadily getting ready. Living in a high demand destination and in close proximity to nature seems to encourage resourcefulness. And while there will be lots of famous names and crowds around next June, nobody in the various hotels or neighbouring towns is fazed.

But Deerhurst Resort Executive Chef Rory Golden sees the Summit as a singular opportunity for Canada and every host nation to showcase its heritage and bounty to the world.

Perhaps understandable when you consider that Muskoka is already a longtime mecca for Hollywood celebs, NHL stars and other notables, since back when Clark Gable, Ernest Hemingway and Princess Juliana of the Netherlands all summered here.

“Wine, cheese, seafood, our country produces so many great, perhaps unexpected, flavours from coast to coast,” said Golden.

Music superstar Shania Twain performed in Deerhurst’s popular stage shows before getting her big break in Nashville.

“We all come from different viewpoints and cultures.”

And every summer theatre and music festivals across the region are packed with well known acts.

“But somehow when you can

“For all of us it’s a summit in more than one sense,” said Klein. “It takes a massive team effort across the government, services, our communities, the private sector and the host venue to complete the mountain of preparations and make it easy for the most powerful people on the planet to relax with each other and get down to business.” “Day-by-day we’re looking forward to collaborating with everyone, especially our neighbors across the region. This is a tremendous opportunity to showcase the Muskoka region, Ontario and Canada around the globe.” “We are honored, we are proud, we’re busy and we’re delighted.” Before and after June 2010, one thing seems certain, Muskoka will continue to be a great place to meet, or just get away from it all.

IF YOU GO

For destination information visit discovermuskoka.ca and huntsvilleadventures.com

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Brighton Equity Investments, has purchased a 50% interest in Triox Technologies, Inc. (TTI).Triox is a research and development contractor in the area of material science and will be co-managed by Brighton Technologies. From the natural energy within an atom, TTI has been able to harness energy to generate electricity, which will spontaneously and continuously produce an electrical

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Brighton Parking Systems ( www.selfvalet.com ) has the potential of being the largest automated parking company in the United States. Brighton Parking Systems reduces space required for parking, lowers constructions costs, and provides secure and safe parking while protecting the environment.

Brighton Technologies is also acquiring a 50% interest in an Alaska water bottling company. This facility has the potential of producing 100,000 liters of pure glacier water per week and an additional 1,000,000 gallons of water to be shipped by bulk carrier to third world countries. The revolutionary discovery of our Alaskan partners in bottling will set Brighton a part from all other water companies. To our knowledge we’ll be the only bottling company shipping our water in biodegradable containers.

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Quinney

Hilton

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Quinney

Country profiles Canada

France

Germany

Japan

Italy

United Kingdom

United States of America

Russia

Leader:

Prime Minister Stephen Harper

President Nicolas Sarkozy

Chancellor Angela Merkel

Prime Minister Taro Aso

Prime Minister Silvio Berlusconi

Prime Minister Gordon Brown

President Barack Obama

Geographical information:

President Dmitriy Medvedev Geographical information:

Area: 9,970,610 km2 Population: 32.6 million (2006) Annual population growth rate: 1.0% (2006) Capital: Ottawa Official languages: English and French

Area: 550,000 km2 Population: 63.0 million (2006) Annual population growth rate: 0.5% (2006) Capital: Paris Official language: French

Area: 357,021 km2 Population: 82.3 million (2006) Annual population growth rate: -0.2% (2006) Capital: Berlin Official language: German

Area: 377,864 km2 Population: 127.7 million (2006) Annual population growth rate: -0.003% (2006) Capital: Tokyo Language: Japanese

Area: 301,255 km2 Population: 58.3 million (2006) Annual population growth rate: 0.3% (2006) Capital: Rome Official language: Italian

Area: 244,820 km2 Population: 60.5 million (2006) Annual population growth rate: 0.5% (2006) Capital: London Official language: English

Area: 9,629,091 km2 Population: 299.4 million (2006) Annual population growth rate: 0.9% (2006) Capital: Washington D.C. Official language: English

Economic data:

GDP (nominal) 2007 [2] - Total $1,436 billion - Pro capita $43,674 - % World GDP 2.6% [4]

GDP (nominal) 2007 [2] - Total $2,593 billion - Pro capita $ 42,033 - % World GDP 4.8 [4]

GDP (nominal) 2007 [2] - Total $ 3,321 billion - Pro capita $ 40,400 - % World GDP 6.2 [4]

GDP (nominal) 2007 [2] - Total $ 4,382 billion - Pro capita $ 34,296 - % World GDP 8.0 [4]

GDP (nominal) 2007 [2] - Total $ 2,105 billion - Pro capita $ 35,745 - % World GDP 3.9 [4]

GDP (nominal) 2007 [3] - Total $ 2,804 billion - Pro capita $ 46,098 - % World GDP 5.1 [4]

GDP (nominal) 2007 [2] - Total $ 13,808 billion - Pro capita $ 45,725 - % World GDP 25.3 [4]

GDP (PPP) 2007 [3] - Total $ 1,270 billion - Pro capita $38,617 - % World GDP 2%[4]

GDP (PPP) 2007 [3] - Total $ 2,068 billion - Pro capita $ 33,508 - % World GDP 3.2 [4]

GDP (PPP) 2007 [3] - Total $ 2,812 billion - Pro capita $ 34.212 - % World GDP 4.3 [4]

GDP (PPP) 2007 [3] - Total $ 4,292 billion - Pro capita $ 33,596 - % World GDP 6.6 [4]

GDP (PPP) 2007 [3] - Total $ 1,787 billion - Pro capita $ 30,365 - % World GDP 2.8 [4]

GDP (PPP) 2007 [2] - Total $ 2,168 billion - Pro capita $ 35,634 - % World GDP 3.3 [4]

GDP (PPP) 2007[3] - Total $ 13,808 billion - Pro capita $ 45,725 - % World GDP 21.3 [4]

Form of government:

Federal parliamentary monarchy

Presidential republic

Parliamentary federal republic

Parliamentary constitutional monarchy

Parliamentary republic

Parliamentary constitutional monarchy

Presidential federal republic

Federal Republic

G8s held to date:

Gleneagles Summit (2005) Birmingham Summit (1998) London Summit (1991) London Summit (1984) London Summit (1977)

Sea Island, Georgia (2004) Denver, Colorado (1997) Houston, Texas (1990) Williamsburg, Virginia (1983)

G8s held to date: Kananaskis Summit (2002) Halifax Summit (1995) Toronto Summit (1988) Ottawa Summit (1981)

Evian Summit (2003) Lyon Summit (1996) Summit of the Arch (1989) Versailles Summit (1982) Rambouillet Summit (1975)

Heiligendamm Summit (2007) Cologne Summit (1999) Munich Summit (1992) Bonn Summit (1985) Bonn Summit (1978)

Hokkaido Toyako Summit (2008) Kyushu-Okinawa Summit (2000) Tokyo Summit (1993) Tokyo Summit (1986) Tokyo Summit (1979)

Genoa Summit (2001) Naples Summit (1994) Venice Summit (1987) Venice Summit (1980)

Area: 17,075,200 km2 Population: 142.8 million (2006) Annual population growth rate: -0.5% (2006) Capital: Moscow Official language: Russian Economic data: GDP (nominal) 2007 [2] - Total $ 1,290 billion - Pro capita $ 9,074 - % World GDP 2.4 [4] GDP (PPP) 2007 [3] - Total $ 2,090 billion - Pro capita $ 14,705 - % World GDP 3.2 [4]

G8s held to date: Saint Petersburg Summit (2006)

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G5 Countries

Nickel institute

Brazil Geographical information:

Leader: President, Luiz Inรกcio Lula da Silva Geographical information:

Area: 9,596,960 km2 Population: 1,331 million (2008) Capital: Beijing Official language: Mandarin Chinese

GDP (PPP) 2007 [3] - Total $ 2,989 billion - Pro capita $ 2,659 - % World GDP 4.58

Economic data:

Parliamentary Federal Republic

GDP (nominal) 2007 - Total $ 3,250 billion - Pro capita $ 2,461 - % World GDP 6.0

Area: 8,514,876 km2 Population: 192 million (2008) Capital: Brasilia Official language: Portuguese

GDP (PPP) 2007 [3] - Total $ 6,991 billion - Pro capita $ 5,292 - % World GDP 10.82

Economic data:

Socialist Republic

GDP (nominal) 2007 - Total $ 1,314 billion - Pro capita $ 6,938 - % World GDP 2.8

India

China

President, Jacob Zuma Geographical information:

Leader:

Area: 1,221,037 km2 Population: 47 million (2008) [1] Capital: Cape Town (legislative), Pretoria (administrative), Bloemfontein (judicial) Official language: Afrikaans, English

President Felipe Calderรณn

Economic data:

Geographical information:

GDP (nominal) 2007 - Total $ 283 billion - Pro capita $ 5,906 - % World GDP 0.5

Leader:

Economic data:

Head of Government: Manmohan Singh

GDP (nominal) 2007 - Total $ 893 billion - Pro capita $ 8,478 - % World GDP 1.9

Geographical information:

Leader:

Mexico

Area: 1,972,550 km2 Population: 108 million (2008) Capital: Mexico City Official language: Spanish

Form of Government:

South Africa

Form of Government:

GDP (PPP) 2007 - Total $ 1,836 billion - Pro capita $ 9,695 - % World GDP 2.8

Presidential Federal Republic

- Total $ 1,099 billion - Pro capita $ 977 - % World GDP 2.0

Area: 3,287,594 km2 Population: 1,148 million (2008) [1] Capital: New Delhi Official language: Hindi, English

GDP (PPP) 2007 [3] - Total $ 1,346 billion - Pro capita $ 12,774 - % World GDP 2.07

Leader:

Economic data:

Federal Republic

President: Hu Jintao

GDP (nominal) 2007

GDP (PPP) 2007 - Total $ 467 billion - Pro capita $ 9,761 - % World GDP 0.71 Form of Government: Constitutional Republic

Form of Government:

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