International Affairs Review - Fall 2014

I NTERNATI ONAL AFF AI RSREVI EW

VOLUMEXXI I I , NUMBER1 F ALL2 0 1 4

The International Affairs Review is a non-profit, peer-reviewed, academic journal published biannually in Washington, DC. It is an independent, graduate student-run publication sponsored by the Elliott School of International Affairs at the George Washington University.

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Cover Image Credits: "Effect of the Drought on Uvas Reservoir" by Don DeBold, used under CC BY 2.0 / Resized and levels modified from original http://goo.gl/lrI91f --- www.flickr.com/photos/ddebold/ https://creativecommons.org/licenses/by/2.0/legalcode Copyright © 2014 International Affairs Review All Rights Reserved.

ISBN: 978-0-578-15368-1 Printed in the United States of America by Signature Book Printing, www.sbpbooks.com

FROM THE EDITOR’S DESK recently attended an event at the National Security Archive, housed in the George Washington University’s Gelman Library, discussing publishing 25 years after the collapse of communism. The access to archival material was extraordinary in the early 1990s, though it was – and still is in many ways – limited to those who can read the language in question and who are willing to travel far afield to copy materials by hand.

Again and again, the speakers emphasized that international affairs is a field that truly requires interaction with an international group of scholars.

I am proud to report that International Affairs Review, both in print and online, is drawing from graduate-level scholarship not just from the Elliott School of International Affairs, but from across the globe.

I

Miki Lendenmann, the author of our first piece on an agricultural policy dealing with climate change, is currently working with the Peace Corps in Moldova. Aaron Turner edited his U.S.-Vietnam piece from a hotel room in Manila, Philippines, while Josh Khoury wrote his based on his experience working in the Middle East. Meanwhile, Christina Gathman and John Driscoll have drawn from international sources to make their arguments on different aspects of organized crime, and the Elliott School capstone group that wrote the piece on developing an LNG trade relationship with Japan has spent this semester working with transnational companies. In addition, I am happy to announce the return of book reviews to IAR – one of which was written by an international student.

This fall, IAR also reinstituted an advisory board, consisting of four distinguished members of the Elliott School faculty: Marlene Laruelle, Kim Thachuk, Mark Gaspar, and J. Furman Daniel. I thank them for their time, ideas, and mentorship. I also thank the staff members of IAR, many of whom stepped directly into leadership roles, and all of whom provided critical inputs to this issue and to the organization. Our partners on the web side of the publication have consistently put forth excellent and thought-provoking pieces on foreign policy and international news.

I hope you find this issue as interesting as we do.

Elizabeth Burnham, editor-in-chief

MASTHEAD EDITOR-IN-CHIEF Elizabeth Burnham MANAGING EDITOR Mia Brown SENIOR EDITORS Bruno Binetti Michael Buchanan Dillon Clancy Amnah Hillou James Nusse William Harrington ASSOCIATE EDITORS Mia Brown Ivana Djukic Amber Footman Nicole Golliher Steven Inglis Robert Larsen Keran Shao Adam Yefet Sebra Yen BOOK REVIEW EDITOR Joey Cheng LAYOUT EDITORS Travis Parrott Limeng Sun COPY EDITORS Amira Loufti Genevieve Neilson EDITOR AT LARGE Jaimie Clark BUSINESS DEVELOPMENT Madhur Mirani Sarah Music CONTRIBUTING WRITERS Barbara Adair, Bruno Binetti, Julia Collins, Rudolfo De la Cruz, John Driscoll, Christina Gathman, John Gillis, Josh Khoury, Miki Lendenmann, Thomas Nelson, Aaron Scott Turner, Zheng Zhu

WRITE TO US: International Affairs Review Elliott School of International Affairs 1957 E Street, NW Suite 303K Washington, DC 20052 www.iar-gwu.org iar@gwu.edu The International Affairs Review accepts submissions year round, with a call for submissions occurring at the beginning of each academic semester and selection rounds shortly thereafter. For further information or to request notification, contact the editors at iar@gwu.edu.

Back issues are available to individuals, libraries, and institutes; contact the editors with the year, volume, and issue number, phone number or email address, and mailing address.

The International Affairs Review publishes short pieces weekly at www.iar-gwu.org and in the IAR Newsletter. Subscribe at www.iargwu.org, or submit items of about 1000 words to iarsubmissions@ gmail.com.

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A CLIMATE-SMART AGRICULTURE POLICY

A Climate-Smart Agriculture Policy in the Face of Droughts in Moldova Miki Lendenmann Miki Lendenmann is a Master’s candidate in International Development at the Josef Korbel School of International Studies in Denver, Colorado. As part of Korbel’s Peace Corps Master’s International (PCMI) program, she completed her coursework in March 2014 and began her service as a Peace Corps Volunteer in the Republic of Moldova in June 2014. Her primary placement is in the southern region of the country with an NGO called Hospice Angelus Taraclia. Miki also hopes to establish connections with the youth to facilitate secondary projects in the community over the next two years of her service.

Abstract The effects of climate change have had and will continue to have devastating impacts on agriculture yields and production in the Republic of Moldova (RM) and throughout the world. Specifically, increased and more severe droughts will increase the number of hot days, decrease the water supply available for irrigation systems, and potentially reduce crop yields and production by 20 to 50 percent in the RM by 2050. Although the RM has been involved in several multilateral and regional initiatives to adopt climate change adaptation and mitigation policies, there is still much to be done to protect the country’s dominant agricultural sector that employs anywhere between 27 and 40 percent of the total population. Thus, this paper recommends a climate-smart agriculture (CSA) policy that combines investment in irrigation infrastructure, investment in the use of drought-tolerant, diseaseresistant seeds and crops, and promotion of education and technical training for farmers on the effects of climate change and proper uses of these technologies. The CSA policy should initially target rural, poor farmers in the southern region of the RM – the population with the highest risk of experiencing the most severe 6 INTERNATIONAL AFFAIRS REVIEW

MIKI LENDENMANN effects of droughts in the country – and, if successful, should be replicated throughout the rest of the country. Finally, to increase its size, scope, and magnitude, multiple stakeholders, including international organizations such as the United Nations and the regional partners like Romania and Ukraine, should coordinate their efforts to organize and implement the CSA policy in the RM and throughout Eastern Europe.

EU GHGs LDC LEDS MCC MDGs MEN MAFI NCCAS NERICA RM UN UNDP UNEP UNFCCC

Acronyms & Abbreviations European Union Greenhouse Gases Least-Developed Country Low Emissions Development Strategy Millennium Challenge Corporation Millennium Development Goals Ministry of the Environment Ministry of Agriculture and Food Industry National Climate Change Adaptation Strategy New Rice for Africa Republic of Moldova United Nations United Nations Development Program United Nations Environment Program United Nations Framework Convention on Climate Change

Statement of Issue The government of the Republic of Moldova (RM) should continue to pursue its national, regional, and international coordination efforts and to strengthen its climate change adaptation policies related to the domestic agriculture sector. The United Nations Framework Convention on Climate Change (UNFCCC) defines climate change as “a change of climate which is attributed directly or indirectly to human activity that alters the composition of the global atmosphere and which is in addition to natural climate variability observed over comparable time periods.”1 By 2050, the effects of climate change are projected to alter aspects of every sector in 7 VOLUME XXIII, NUMBER 1 · FALL 2014

A CLIMATE-SMART AGRICULTURE POLICY every country in the world. Many of the negative effects, such as the frequency and severity of natural disasters, reduction in crop yields, and increased food insecurity will disproportionately affect least-developed countries (LDCs).2 Specifically in the RM, droughts, which are defined as a lack of precipitation for fourteen days or more in October through March, or ten days or more in April through September, will affect a variety of stakeholders in RM’s agriculture sector.3 Ceteris paribus, an increase in the frequency and severity of droughts will increase the number of hot days, decrease the water supply available for irrigation systems, and potentially reduce crop yields and production by 20 to 50 percent by 2050.4 Droughts will also lead to soil erosion and degradation of arable land for farming.5 Thus, droughts and other natural disasters exacerbated by the effects of climate change will affect all members of the population that are directly part of the agriculture supply chain and those involved in subsistence farming.

As the main governing body that oversees the RM’s dominant agriculture industry and with the financial and political support of the central government, the Ministry of Agriculture and Food Industry (MAFI) should be a leader in the continued implementation of existing adaptation policies and the development of new policies to adapt to droughts. The MAFI should collaborate with the RM’s Ministry of the Environment (MEN) to ensure that current and future policies will work to maintain agriculture productivity and yields, as well as increase crop resilience to the effects of droughts and other consequences of climate change. Lastly, because the effects of climate change are a transnational issue, the MAFI and MEN should also continue to collaborate with international organizations (IOs), such as the United Nations (UN), its regional partners, Ukraine and Romania, and the European Union (EU) as a whole.

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MIKI LENDENMANN Why We Care The government of the RM should care about an increased frequency and severity of droughts because they will affect virtually every sector in the country (i.e., agriculture, energy, public health, etc.). For the agriculture sector, in particular, droughts pose a threat to the livelihoods of agriculture producers, subsistence farmers, and those employed in agriculture.

Agriculture production, food processing, and food exports play a prominent role in the RM’s economy. In 2011, 52 percent of the country’s total exports were food products, 32 percent of all agricultural exports went to the European Union (EU), and food processing accounted for 40 percent of the RM’s total industrial production.6 What is more, according to various sources, the agriculture sector employs between 27 to 40 percent of the total population and more than half of the population in rural areas.7 Thus, the issue is twofold. Firstly, droughts will negatively affect the RM’s aggregate economic growth and productivity because of its substantial impact on the agriculture sector. Secondly, all of those directly or indirectly tied to agriculture will experience changes in their food and health security if the status quo continues. Droughts will affect the poorest segments of the population living in rural areas the most because of a heavy dependency on seasonal weather patterns and adequate rainfall that supplies water for subsistence or income-generating agriculture production.8 The damaging effects of droughts on RM’s agriculture sector will impede the economic and human development of a large percentage of the population that relies on income or food from agriculture, which in turn, will affect the development of entire country. Furthermore, increased and more severe droughts will not only negatively affect agriculture production, but will also have a profound effect on the RM’s achievement of the UN’s Millennium Development Goals (MDGs). Without a solid, 9 VOLUME XXIII, NUMBER 1 · FALL 2014

A CLIMATE-SMART AGRICULTURE POLICY coordinated policy framework with national, regional, and international stakeholders, the effects of droughts and other natural disasters induced by climate change will undermine the RM’s progress toward the MDGs.9 Background The most important natural resource in the RM is its arable land, which makes up about 75 percent of the country’s total area.10 Approximately 75 percent of this arable land is composed of chernozem, a black soil that is rich in nutrients and has a high yield capacity, making it optimal for agriculture.11 Due to climate change, however, there will be an increased variability in weather patterns, which will cause soil degradation. By 2040, the average temperature in the RM is expected to increase by 2 degrees Celsius, which will considerably reduce the amount of arable land.12 Thus, overall increasing temperatures and droughts will lead to land degradation, which will decrease agricultural productivity and lead to rural migration. In addition to soil erosion, droughts pose high risks for agriculture in the RM, including increased water scarcity, decreased crop yields, desertification, and increased agricultural pests and diseases.13 Severe and more frequent droughts occurred several times over the last decade, the most recent of which were in 2007 and 2012.14 Over a short period of time, the droughts largely reduced the RM’s cereal, maize, and sunflower harvests, which are all important crops for the agriculture industry (see Figure 1 for agriculture production in the RM from 19912011 and Figure 2 for a geospatial view of the 2007 drought).15 The reduction in crop yields and harvests will continue to have devastating effects on the agriculture sector and the RM’s overall economic growth.

Increased and more severe droughts have both overarching and isolated effects on the land and people. That is, the most recent droughts reduced summer crop production throughout the region in parts of the RM, Romania, Ukraine, and Russia.16 At the same time, specifically in the RM, droughts affected and in the future will disproportionately affect small farmers and agricultural workers in the rural, southern region of the country, who represent the poorest segment of the population (see Figure 3).17 Greater drought intensity will have larger impacts on impoverished, 10 INTERNATIONAL AFFAIRS REVIEW

MIKI LENDENMANN vulnerable, rural farmers in the south because of their greater dependence on optimal climate conditions for crop yields. Thus, droughts will reduce income generated from agriculture production and decrease the overall food supply, which will push the poorest households into further destitution and increase their food insecurity.18

Figure 1: Agriculture Production in Moldova from 1991 to 201119 Droughts in 2003, 2007, and 2012 were a factor for negative production and crop yields.

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A CLIMATE-SMART AGRICULTURE POLICY

Figure 2: 2007 Drought in Moldova: Geospatial view of the effects of droughts on crop production over two months20

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Figure 3: Priority Risks by Region in Moldova21 Notice that the increased risks for drought and water scarcity have the greatest impacts on the central and southern region of the country.

Pre-Existing Policies To address the problem of climate change on agriculture production, unlike many LDCs, the government of the RM has been part of multiple multilateral initiatives to adhere to mitigation and adaptation strategies since the 1990s. For example, the RM ratified the UNFCCC in 1995 and the Kyoto Protocol in 2003, which showed its commitment to combat the effects of climate change on its geography and economy.22 Under the UNFCCC, the Ministry of the Environment (MEN) of the RM created two extensive strategies, the National Climate Change Adaptation Strategy (NCCAS) and the Low Emission Development Strategy (LEDS), which should be approved by the government of the RM in 2014.23 The NCCAS focuses on promoting resilience to future effects of climate change through sustainable uses of the environment’s natural resources with the support of the United Nations Development Program (UNDP).24 The document provides a detailed framework for the coordination and integration of multiple sectors in the RM, including energy, transport, agriculture, and health to effectively manage the plethora of risks 13 VOLUME XXIII, NUMBER 1 · FALL 2014

A CLIMATE-SMART AGRICULTURE POLICY associated with climate change.25 Similarly, the LEDS provides a detailed mitigation strategy for how the RM should move towards a low-carbon emission society through the reduction of greenhouse gas emissions (GHGs) in every sector.26 The overarching goal of LEDS is to reduce GHGs by 20 percent or greater to prevent average global temperatures from exceeding 2 degrees Celsius in the next 100 years.27 Policies will include using manure as fertilizer and increasing the amount of legumes planted to increase carbon in soils, reducing the use of nitrogen fertilizer to decrease N2O emissions, and rotating crops to reduce carbon emissions.28 The NCCAS and the LEDS show the RM’s commitment to national and global environmental protection strategies. However, due to the effects of GHG emissions, specifically the increased severity and frequency of droughts and other natural disasters in the region, the NCCAS and LEDS alone are not sufficient to reduce the global impact of climate change in its entirety.

The RM is also part of the European Union (EU)-funded Clima East project package, which includes the partnership of six Eastern European countries and the Russian Federation.29 In the RM, Clima East has two projects, the Policy Project and the Pilots Project, which are funded and supported by the UNDP and the EU. These projects aim to reduce GHG emissions, appropriately manage natural resources, and promote economic growth in the RM.30 Notably, on December 2, 2014, all seven members of Clima East are scheduled to meet in Chisinau, the RM’s capital, to discuss progress made in 2014 and further actions that should be taken for the Policy Project in 2015.31 This will serve as an opportunity for the RM to share the MAFI and MEN’s strategies and future goals. In addition, it is an opportunity to discuss how the RM and its regional partners can collaborate with the assistance of the UNDP and the EU to address increased and more severe droughts and other aspects of climate change on agriculture in Eastern Europe.

Another strategy that the MAFI of the RM established after the country’s catastrophic 2007 drought was the National Strategy for Sustainable Development of the Agro-Industrial Sector for 2008-2015.32 This strategy promotes the economic competitiveness of the RM’s agriculture industry 14 INTERNATIONAL AFFAIRS REVIEW

MIKI LENDENMANN and also ensures sustainable development and climate change resilience through farmer subsidies, education, trade and investment, and research and development.33 In order for this policy to be successful and continue after 2015, the MAFI needs additional financial support and increased capacity to monitor and evaluate the impacts of these policies, both of which are currently lacking in the RM.34 Lastly, with the 2005 Law of Organic Agri-Food Production, the MAFI pushed for Moldova’s structural and technological transition from traditional agriculture organic agriculture to reduce the amount of GHGs from the agriculture industry.35 In 2009, the RM exported U.S. $46 million of organic products, which accounted for 11 percent of the RM’s total agriculture exports.36 The MAFI supports organic agriculture because of its potential to reduce the degradation of arable land that results from chemical fertilizers and improper crop rotation used in traditional Moldovan agriculture.37 Policy Options and Advantages/Disadvantages As seen from the plethora of research and data on the negative present and future effects of droughts and climate change in general on agriculture production in the RM and throughout the world, doing nothing is an unacceptable, unsustainable decision that should be ruled out as an option for the global community at large.38 Specifically in the case of the RM, the review of current policies shows the existing efforts by the Ministries of Agriculture, Energy, Environment, etc. to develop and implement climate change adaptation and mitigation policies to protect the RM’s agriculture industry.

This commitment must endure throughout the twenty-first century, as droughts and other effects of climate change will continue to pose a threat to agriculture and every sector in the country.

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A CLIMATE-SMART AGRICULTURE POLICY Policy Option A) Invest in Irrigation Infrastructure and Water Management Systems The first policy option for the RM is to invest in irrigation infrastructure and water management systems throughout the country, especially in the southern region, where the land and people are most prone to severe droughts due to less rainfall and generally lower socioeconomic status.39 Similar to the agreement signed in 2010 between the RM and U.S. development agency, the Millennium Challenge Corporation (MCC), irrigation repairs, construction, or management could be undertaken over a five-year period.40 These irrigation systems would need to be appropriately designed and managed due to the RM’s limited water resources. In a previous study, many Moldovan farmers advocated for drip irrigation as a means to increase crop yields.41 The advantages of irrigation include ensuring controlled water supply for agriculture, increasing agricultural productivity and food security despite increased droughts, and the RM’s partnerships with the EU, UN, and other international organizations (IOs) that could provide technical and educational support for such a policy. Investment in irrigation would directly tackle the problem of decreased agriculture productivity the country experienced in severe droughts throughout the last decade.

Furthermore, it would reduce the RM’s reliance on external food aid or food imports. Educating farmers about how to use and maintain these irrigation systems would increase their proper use and sustainability. The prospective disadvantages of this policy are fourfold: forced migration of inhabitants, potential for irrigation to disproportionately benefit middle to high-income agriculture stakeholders instead of the poor, unintended environmental consequences of a shift in the natural ecosystems of large bodies of water, and huge costs that would be incurred.

Policy Option B) Use of Drought-Tolerant, Disease-Resistant Seeds and Crops The second policy option for the government of the RM is to invest in the use of drought-tolerant, disease-resistant seeds and crops, especially in 16 INTERNATIONAL AFFAIRS REVIEW

MIKI LENDENMANN rural, drought-prone areas of the country. Similar initiatives proved to be successful in other parts of the world. For example, in the New Rice for Africa (NERICA) project, the African Rice Center created a hybrid of Asian and African rice that was drought-tolerant and disease-resistant even in nutrient-lacking soil.42 The cost was $41.2 million over six years from 2005 to 2011, or about $6.6 million per year.43 Despite high costs, crop production substantially increased and poverty levels decreased in several countries. NERICA rice yields 1,500 kilograms per hectare without fertilizers and 2,500 kilograms per hectare with fertilizers, as opposed to traditional rice that yields 800 kilograms per hectare.44 NERICA had strong support from and partnerships between AfricaRice, a regional research center, and the African Development Bank.45 In addition, local farmers were trained throughout the process to increase local awareness and ensure sustainability.46 Thus, NERICA showed that the involvement multiple stakeholders, including local beneficiaries, an international bank, and a regional center contributed to the project’s success in multiple countries in the region. A similar model could be altered appropriately for crop and country context and replicated in the RM and other countries in the region over a five-year period. By involving domestic, international, and regional stakeholders in the widespread use of drought-tolerant, disease-resistant seeds, shared resources expertise would create a larger impact throughout the region.

The advantages of this policy are increased food security and decreased reliance on foreign assistance or food imports. Additionally, farmers would be able to plant and harvest different crops, which would expand their skill-set and diversify their production. The disadvantages are that this policy would require a huge investment in time and money to train farmers on how to prepare, harvest, and store these new varieties of crops.

Many farmers in the RM do not have sufficient information on how to properly and effectively harvest these crops, in addition to a lack of knowledge about the extent of the impacts of droughts and climate change on traditional crops and seeds.47 Furthermore, there may be a resistance to planting new crops that farmers are unfamiliar with or do not think there is a demand in the market for, which would compromise the success and 17 VOLUME XXIII, NUMBER 1 · FALL 2014

A CLIMATE-SMART AGRICULTURE POLICY longevity of such a policy.

Policy Option C) Transition to Organic-Dominated Agriculture Industry A third policy option for the government of the RM is to invest in a transition from traditional farming methods to an agriculture industry that is dominated by organic farming. As previously mentioned, in 2005 the MAFI pushed for the transition to organic farming because of its many advantages, including reduction in pollution created from traditional agriculture and the sustainable methods of organic farming used on soil and arable land. In organic farming, GHG emissions are estimated to be half of the amount of GHGs that are emitted by traditional agriculture.48 Furthermore, there is a growing international market for organic products, especially in the EU and the United States. The international organic food market was about U.S. $60 billion in 2010 and is expected to increase in the future.49 Transitioning to organic agriculture, then, would be especially advantageous for the RM because one-third of its food exports go to the EU and will likely increase with the recent EU-Moldova Association Agreement.50 Lastly, because organic food prices are about 20 to 30 percent higher than traditional food products, farmers could potentially see vast increases in their incomes.51 The disadvantages of a transition to organic farming are most seen in the feasibility of success, particularly in rural, poor areas that lack understanding about the value of organic farming because their top priorities are to survive and maintain household food security.

Furthermore, some studies show that more than three-quarters of the population in the RM have no knowledge about organic agriculture or food products.52 Thus, there is still limited supply from producers and demand from consumers for organic food in the RM’s markets. A second major challenge is that organic agriculture requires higher-level training and more labor inputs than traditional agriculture, which rural, poor farmers may not be willing or able to put in, especially because organic crops do not always have higher yields than traditional ones.53 Further research is needed on the value of organic farming in comparison to traditional farming, which makes a full transition from traditional to 18 INTERNATIONAL AFFAIRS REVIEW

MIKI LENDENMANN organic extremely risky. Lastly, while organic agriculture has the potential to reduce GHGs and is generally more environmentally friendly than traditional agriculture, it does not directly tackle the issue of increased droughts that will damage organic crops just as much as traditional ones.

Thus, this policy option could be implemented as a long-term policy prescription over the next two decades with an education campaign about the benefits of organic agriculture production and consumption in an effort to gradually increase its supply and demand. However, this policy alone is not sufficient to adapt to the effects of climate change.

Recommendation and Plan for Implementation: Climate-Smart Agriculture Policy The biggest challenge for the MAFI and the government to implement the three aforementioned policy options or for any unmentioned options is the insufficient institutional capacity and coordination mechanisms across stakeholders within the government of the RM.54 Thus, the government should increase coordination between different Ministries and with its regional partners and IOs to increase financial and capacity-building support. Coordination with regional partners and IOs would have a larger impact on the RM’s agriculture sector and create a sense of shared responsibility for implementing climate adaptation policies in Eastern European region. Because climate change is a transnational issue, the RM’s government should engage in a coordinated multisectoral approach at the national, regional, and international level in its policy development and implementation to minimize the damage from droughts, other natural disasters, and poor weather conditions.

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A CLIMATE-SMART AGRICULTURE POLICY In order to promote economic prosperity and ensure sustainable development of the agriculture industry that directly and indirectly affects a huge portion of the country’s population, policies that adapt to increased and more severe droughts must be implemented in the RM. Thus, I strongly recommend the government of the RM to approve the NCCAS and the LEDS, as well as adopt a “climate-smart agriculture (CSA)” policy that will incorporate aspects of policy option A) investment in irrigation infrastructure and, B) investment in the use of drought-tolerant, disease-resistant seeds and crops. The concept of CSA is that agriculture policies should be implemented to improve food security in rural areas through climate adaptation and mitigation strategies.55 Some of these strategies include using irrigation and farming with perennial crops to enrich the amount of carbon in the soil.56 This climate-smart policy should especially target rural, poor farmers in the southern region of the RM, which has the highest risk of crop yield losses, as seen in the droughts of 2003, 2007, and 2012. Furthermore, the CSA policy should be implemented through a collaborative effort via the MAFI and MEN, with capacity and financial support from the government of the RM and IOs, such as the UNDP, the United Nations Environment Program (UNEP), and the International Fund for Agricultural Development (IFAD). Because the RM is the poorest country in Europe and its government lacks sufficient resources to implement a CSA policy on a large scale, collaboration with and assistance from environmental and/or agriculture IOs is necessary to contribute to the effectiveness of a CSA policy in the country.57 These IOs can collaborate with the government, civil society organizations, and farmers on planning and implementing a CSA policy, as well as provide resources for educational trainings, for a pilot droughttolerant, disease-resistant seed project, and for the creation of irrigation infrastructure.

The government and IOs, such as the UNDP, UNEP, and IFAD should support this policy because of their similar goals to promote sustainable, profitable agriculture using climate adaptation/mitigation strategies. This is evidenced by several efforts already made by international development organizations to assist in improving agricultural efficiency and irrigation systems in the RM. For example, as previously mentioned, the MCC 20 INTERNATIONAL AFFAIRS REVIEW

MIKI LENDENMANN signed a five-year U.S. $262 million agreement in 2010 with the RM to repair water irrigation systems and improve agriculture techniques in the country.58 Other IOs should continue to invest in similar projects and support in the implementation of a CSA policy in the RM. In order to increase irrigation systems and institute the use of droughttolerant, disease-resistant seeds and crops, resources will need to be invested in information dissemination, including technical training for farmers on how to properly use irrigation and how to harvest, prepare, and store seeds and crops.59 In some cases, farmers may be resistant to irrigation or the use of new seed varieties, which is why technical training is insufficient; farmers will also need to be educated on the effects of droughts and other natural disasters on current farming methods and agriculture production for them to fully comprehend the value of these policies and to mitigate the waste of financial resources. They should also be trained on how to most efficiently store and manage water during droughts.60 Farmers should receive this education and technical training with the assistance of IOs, the MAFI, non-governmental organizations, and universities in the RM that specialize in agriculture production.

Finally, meteorological information and outreach about impending droughts, floods, or storms should be disseminated to the population through the mass media and mobile phone alerts to increase their preparedness for these events and minimize potentially catastrophic effects on their crops.61 Ultimately, it means nothing if farmers are educated and trained but lack access to new infrastructure and seed varieties. Thus, it is imperative that during the CSA policy planning and implementation, rural, southern, poor farmers are given priority access to drought-tolerant seeds and new irrigation infrastructure. Furthermore, because investment in irrigation and new seeds/crops will be extremely costly and have several unintended consequences, this policy should be implemented incrementally, beginning as a pilot in a selected area in the south. Lastly, it is imperative that the MAFI and the IOs involved collect data to monitor and evaluate the effectiveness of CSA from the perspective of the target population and in response to droughts and other effects of climate change.

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A CLIMATE-SMART AGRICULTURE POLICY Endnotes 1

United Nations Framework Convention on Climate Change (UNFCCC), “Full Text of the Convention,” 2014, http://unfccc.int/essential_background/convention/background/ items/2536.php 2 Robert Paarlberg, Food Politics: What Everyone Needs to Know (New York: Oxford, 2013), 129.

3 European Commission and OECD/EAP Task Force, “Improving the Environmental Quality of the Black Sea Through Better Waste Treatment and Climate Change Adaptation of the Water Sector in Moldova: Assessing the Impact of Climate Change on Water Supply Sources and WSS Systems in Moldova and Inventory Possible Adaptation Measures (Task 1),” 2013, 21. http://ec.europa.eu/environment/marine/internationalcooperation/pdf/Moldova_Task%201_Final_EN_26%20Feb.pdf.pdf 4 William Brittlebank, “Climate Change Reshaping Agriculture in Eastern Europe,” Climate Action Programme, 2013, http://www.climateactionprogramme.org/news/ climate_change_reshaping_agriculture_in_eastern_europe/ 5 Courtenay Cabot Venton and Lilia Taranu, “National Climate Change Adaptation Strategy: Draft for Consultation,” 2011, 11, http://www.clima.md/download.php?file= cHVibGljL3B1YmxpY2F0aW9ucy8yNTI5MjM3X2VuX21vbGRvdmFfbmF0aW9uLnB kZg%3D%3D 6 Liudmila Torodova and Olga Sarbu, “Innovation Policy in Agriculture and Rural Development of the European Union: Prospects for the Republic of Moldova,” Economic Engineering in Agriculture and Rural Development 13, no. 4 (2013): 287.

7 “Low Emission Capacity Building Programme: Moldova,” http://www.lowemissiondevelopment.org/countries/moldova; Millennium Challenge Corporation, “Moldova Compact: Program Overview,” http://www.mcc.gov/pages/ countries/ program/moldova-compact 8 Pradosh K. Nath and Bhagirath Behera, “A Critical Review of Impact of and Adaptation to Climate Change in Developed and Developing Economies,” Environment, Development, and Sustainability 13, no. 1 (2011): 142.

9 Cabot Venton and Taranu, 31.

10 Government of the Republic of Moldova, “National Report for UN CSD 2012 Rio+20,” 2012, 21. http://sustainabledevelopment.un.org/content/documents/ 782Moldova_Report_RIO20_ENG_12-06-2012_final.pdf 11 Ibid.

12 European Commission and OECD/EAP Task Force, 4.

13 Ministry of the Environment of the Republic of Moldova and United Nations Environment Programme, “Third National Communication of the Republic of Moldova Under the United Nations Framework Convention on Climate Change,” Chisinau, 2013, 34.

14 Ministry of the Environment of the Republic of Moldova and United Nations Environment Programme, 224.

15 Ibid.

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16

United Nations – Moldova, World Food Programme, UNDP. “WFP Moldova Rapid Food Security and Vulnerability Assessment,” 2012, 2. http://www2.un.md/drought/ 2012/RapidAssessmentMoldova2012Final.pdf 17 Ibid.

18 Ibid.

19 Ministry of the Environment of the Republic of Moldova and United Nations Environment Programme, 85.

20 “Drought in Moldova.” NASA Earth Observatory. October 6, 2007. http://earthobservatory.nasa.gov/IOTD/view.php?id=8101 21 Cabot Venton and Taranu.

22 Ministry of the Environment of the Republic of Moldova and United Nations Environment Programme, 16.

23 Ibid., 16, 24.

24 Cabot Venton and Taranu, 6.

25 Ibid., 1-73.

26 Ministry of the Environment of the Republic of Moldova. “Low Emissions Development Strategy of the Republic of Moldova to the Year 2020: Draft for Consultation.” 2011, 4.

27 Ministry of the Environment of the Republic of Moldova and United Nations Environment Programme, 24.

28 Ministry of the Environment of the Republic of Moldova, 17-18.

29 European Union. “Clima East: Support to Climate Change Mitigation and Adaptation in the Eastern Neighbourhood Countries and Russia.” 2013, http://www.climaeast.eu/ 30 HTSPE Ltd. 2013, 4.

31 European Union, “Clima East Policy Project Steering Committee to meet in Chisinau, 12/02/2014,” 2013. http://www. climaeast.eu/news/clima-east-policy-project-steeringcommittee-to-meet-in-chisinau-12022014 32 Government of the Republic of Moldova, 16.

33 Ibid.

34 Ibid.

35 Government of the Republic of Moldova, 25-26.

36 Ibid., 47.

37 Ibid.

38 Nath and Behera, 153.

39 Government of the Republic of Moldova, 26; Paarlberg, 130; Valeriu Cosarciuc, FAO World Summit on Food Security.

40 Millennium Challenge Corporation, “Press Release - MCC and Moldova Sign $262 Million Compact: Program Bolsters Moldova’s Agricultural Development and Transportation Networks,” 2010.

41 William R. Sutton, Jitendra P. Srivastava, James E. Neumann, Ana Iglesias, and Brent B. Boehlert. “Reducing the Vulnerability of Moldova’s Agricultural Systems to Climate Change: Impact Assessment and Adaptation Options.” The World Bank, 2013, 12.

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A CLIMATE-SMART AGRICULTURE POLICY

42

Nath and Behera, 155.

African Development Bank Group, “Multinational: The New Rice for Africa (NERICA) Dissemination Project: Increasing Domestic Production, Improving Food Security,” 2.

44 Ibid., 4-5.

45 Ibid., 6.

46 Ibid.

47 Sutton et al., 105.

48 Government of the Republic of Moldova, 48.

49 Ibid.

50 Todorova and Sarbu, 287; “Moldova sets record in ratifying EU association agreement,” Euractiv, July 2, 2014, http://euractiv.com/sections/europes-east/moldovasets-record-ratifying-eu-association-agreement-303249 51 Government of the Republic of Moldova, 48.

52 Ibid.

53 Ibid.

54 Ministry of the Environment of the Republic of Moldova, 12, 18, 23-24.

55 Sara J. Scherr, Seth Shames and Rachel Friedman, “From Climate-Smart Agriculture to Climate-Smart Landscapes,” Agriculture & Food Security, 1.12 (2012), 4.

56 Ibid.

57 Ibid., 6.

58 Millennium Challenge Corporation, “Press Release - MCC and Moldova Sign $262 Million Compact: Program Bolsters Moldova’s Agricultural Development and Transportation Networks,” 2010.

59 Nath and Behera, 150.

60 Sutton et al.,12.

61 Ibid.

43

24 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER

Establishing a New U.S.-Vietnam Security Relationship Cultivating a “Middle Power” as a Strategic Partner Aaron Scott Turner Aaron Turner is from Louisville, K.Y. and is a Major in the U.S. Army working toward his Masters of International Policy and Practice at The George Washington University’s Elliott School of International Affairs.

Currently serving as a Foreign Area Officer in Manila, Philippines, his studies focus on U.S. foreign policy opportunities in the region. Aaron has an A.A. from the Defense Foreign Language Institute in Monterey, C.A. and a B.A. from Transylvania University in Lexington, K.Y. Abstract Relations between the United States and Vietnam have transformed from a state of bitter adversaries to a comprehensive partnership.

However, current U.S. foreign policy fails to recognize the limits to its security relationship with Vietnam: Vietnam’s defense policy leaders are overwhelmingly reluctant to engage with the U.S. in a fashion that challenges China. Vietnam’s recent foreign policy reorientation seeks to befriend and balance both superpowers, thereby creating a ceiling for security cooperation with each. The question must be answered: How can the U.S. reorient its militaryto-military policy towards Vietnam to maximize the security relationship and cultivate a new strategic partner? This is best achieved through a multilateral and institutional approach that indirectly cultivates Vietnam through heavy channeling towards ASEAN participation. U.S. policy must seek to 1) bypass constraints imposed by Sino-Vietnamese relations, 2) reorient military-to-military efforts, 3) increase focus on Vietnam’s domestic development, and 4) continue to build upon economic underpinnings.

25 VOLUME XXIII, NUMBER 1 · FALL 2014

ESTABLISHING A NEW U.S.-VIETNAM SECURITY RELATIONSHIP Introduction Relations between the United States and Vietnam have transformed from a state of bitter adversaries to a comprehensive partnership. Showing a steady improvement since 1995 when relations were formally normalized, the pace has accelerated throughout the past five years.1 However, the current U.S. foreign policy fails to recognize the limits to its security relationship with Vietnam: Vietnam’s defense policy leaders are overwhelmingly reluctant to engage with the United States in a fashion that upsets China.2 Vietnam’s recent foreign policy reorientation seeks to befriend and balance both superpowers, thereby creating a ceiling for security cooperation with each.3 The dilemma of cultivating this middle power as a strategic U.S. partner remains, and the question must be answered: how can the United States reorient its military-to-military policy towards Vietnam to maximize the security relationship and cultivate a new strategic partner?

Background Beginning in 2011, Vietnam wanted to increase relations with the United States, partly because of its need to keep doors open to U.S. markets, and partly due to concerns about China’s rising influence in Southeast Asia.4 Yet, Sino-Vietnamese relations are Vietnam’s most important bilateral relationship, forcing Vietnamese leaders to delicately traverse the fault line between Washington and Beijing so improving relations with one capital does not threaten the other.

Political Dynamics – A Balancing Act Vietnam is now in a position of balancing its investments between the United States and China. Vietnamese senior leaders must make tough decisions that weigh the country’s need for healthy relations with China against the necessity to exercise its independent right to engage in diplomatic and security agendas with other nations.5 Vietnamese leaders have precisely calibrated their ties to the United States with their ties to China. Just as relations with the United States forged new ground in a 26 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER program of military-to-military practical activities, Sino-Vietnamese relations simultaneously broke ground with first-ever port calls to China and seaborne joint search and rescue exercises.6 Therefore, a step forward with one super-power is taken in-turn with the other.

The Vietnamese Communist Party’s (VCP) primary decision-making bodies include the 175-member Central Committee, and the 14-member Politburo. Politburo membership is usually determined by a general geographic balance from the north, central, and south, and factional balance between conservatives and reformers. Conservative groups still influence not only the direction of foreign policy, but also the facets of its implementation. Conservative Vietnamese, who still view the United States with mistrust, are concerned that the objective of the United States is to wear away the Vietnamese Communist Party itself.7 Describing religious freedom, human rights, and democracy as instruments to unravel Vietnam’s socialist regime, conservative Vietnamese fear the educational exchanges are part of the overarching plan of “peaceful evolution.”8 These conservatives oppose the current trajectory of defense relations, and instead focus on the potential friction in Sino-Vietnamese relations increased cooperation with the United States could cause.

Legacy Issues – Treating Old Wounds Unsettled issues from the U.S.-Vietnam Conflict once smothered bilateral relations. Eighteen years ago, a lack of progress in historical issues prevented the United States and Vietnam from developing a comprehensive partnership. The United States’ efforts to fully account for U.S. Prisoners of War/ Missing in Action (POW/MIA) lacked the necessary humanitarian assistance from Vietnam. Certainly POW/MIA recovery still remains one of the highest priorities today for the United States. The issue of Vietnamese refugees also required serious rapprochement. After 1975, many refugees came from the educated and professional classes of the south. Now these refugees’ children have been raised and educated in the United States and speak English as their primary language. Other refugees, who arrived around 25 years ago under the Orderly Departure Program and Humanitarian Operation for re27 VOLUME XXIII, NUMBER 1 · FALL 2014

ESTABLISHING A NEW U.S.-VIETNAM SECURITY RELATIONSHIP education of camp prisoners among other immigration programs, are underemployed and disproportionately represented on welfare as a result of their difficulty adapting to American life.

Additionally, Vietnam’s mandate for the United States to reconcile “the wounds of war,” such as Agent Orange or dioxin, used by the U.S. military as part of its herbicidal warfare program, has been among the most serious legacy issues.9 Operation Ranch Hand, the U.S. Air Force’s defoliant program in Vietnam, was authorized in 1961 and continued until 1971.10 Records indicate over 6,500 U.S. Air Force spray missions throughout Operation Ranch Hand.11 Over 12 percent of South Vietnam was sprayed with an average concentration of 13 times that recommended by the U.S. Department of Agriculture.12 Some soil and sediment bases still have high levels of dioxin and require remediation. The contaminated soil continues to poison the food chain and disrupt ecological equilibrium, causing illness, skin disease, and cancers of the lungs, larynx, and prostate.13 Although the U.S. government has challenged the figures as highly inflated, the Vietnamese government estimates 3 million citizens have suffered illnesses from exposure to Agent Orange while the Red Cross of Vietnam estimates 1 million citizens are disabled or have health problems due to exposure.14 Some aspects of these legacy issues still remain, and will likely carry forward for generations, but they are not the central focus of current bilateral relations.15 The United States now accepts that Vietnam is putting forth its best effort to provide full accountability for MIAs.16 In 2007, to help with dioxin removal the U.S. Congress appropriated funds to redress the contamination and offer health clinics in Da Nang, one of the primary former storage sites.17 To help address the locations heavily contaminated with dioxin, and to assist in public health programs for those communities most affected, funding for such programs was renewed in FY 2009, and increased in both FYs 2010 and 2011.18 These legacy issues have slowly shifted from center stage; however, as a landmark for future cooperation with the United States, Vietnamese Prime Minister Nguyen Tan Dung enabled continued U.S. assistance to overcome the consequences of war.19 28 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER The Geostrategic Stage – Spotlight on China Located on the eastern coast of the South Asian subcontinent, Vietnam is a key geostrategic partner bordering China, Laos, and Cambodia. Also positioned along the Gulf of Thailand, Gulf of Tonkin, and the South China Sea, Vietnam has a potential maritime foothold for regional influence.20 Vietnam’s 3,444 kilometers of coastline could offer naval ships access to commercial port facilities in Da Nang and Cam Ranh Bay for refueling and maintenance of logistics vessels and potentially access by warships.21 Further, a relationship with Vietnam comports with the Pivot to the AsiaPacific and enhances the strategic positioning of the United States given China’s nascent power. This remains true whether the U.S. strategy towards China is to encircle and contain, or develop a more robust and productive relationship. Vietnam also views the United States as a key to maintaining strategic balance in Southeast Asia.22 For each country, a productive relationship is fitting regardless of respective strategies used to achieve foreign policy objectives. An improved relationship accommodates multiple strategies, specifically with respect to China.

The role that China plays in Vietnam’s foreign policy requires the most focus on the geostrategic stage. Perceived by Vietnam as both an economic rival and partner, China’s imports have skyrocketed over the last ten years, accounting for nearly a quarter of Vietnam’s total imports, while China’s export market for Vietnamese goods and services represents about 10% of Vietnam’s exports value.23 Both China and Vietnam compete for foreign direct investment (FDI) and market shares in their hallmark low-cost manufacturing products.24 This competition and Vietnam’s rising trade deficit, surpassing $18 billion in 2011, has become a growing concern for Vietnam’s senior leaders.25 Perhaps more critically, the two states are connected in more than a trade relationship; their respective infrastructures have also become increasingly interlaced, with China’s southeastern power plants providing electricity for parts of northern Vietnam.26 Furthermore, Prime Minister Dung’s economic policies rely on Chinese investments in Vietnam’s natural resources.27 29 VOLUME XXIII, NUMBER 1 · FALL 2014

ESTABLISHING A NEW U.S.-VIETNAM SECURITY RELATIONSHIP Despite the concern created by Vietnam’s economic dependence on China, there have been marked improvements in Sino-Vietnamese relations since the late 1990’s following China’s adoption of a new security concept of cooperation with its neighbors.28 Hanoi now avoids undertaking significant diplomatic moves without gauging Beijing’s reaction, understanding the value of maintaining friendly and stable relations with its powerful northern neighbor. In truth, China’s Communist Party is a sociopolitical bedfellow for Vietnam and an exemplar for a country seeking to increase market forces in its economy without threatening its ruling communist party’s authority.29 Conversely, conflicting territorial claims over the Spratly and Paracel Islands in the South China Sea leave the states in a precarious opposition.

Having caused military clashes in the late 1980s, tensions increased again in the 2000s. As a result, Vietnam signed contracts in 2009 to purchase billions of dollars of military equipment from Russia, including six Kiloclass submarines, and increased their defense budget by almost 70 percent from 2005 to 2008.30 Tensions flared up again in 2011 when Chinese fishing vessels, along with Chinese naval ships, cut cables being used by Vietnamese boats exploring energy deposits in waters claimed by both countries.31 Vietnamese citizens continue to harbor resentment toward China, requiring Vietnamese officials to act with great dexterity.

Vietnam opposes intimidation, coercion, and threatening use of force by any nation to assert its claim. Instead, Vietnam seeks peaceful resolution of sovereignty disputes with a basis in international law and the United Nations Convention on Law of the Sea. Vietnam is not the only country that has territorial disputes with China in the South China Sea. Other ASEAN members share a common interest in effectively promoting maritime security through the region’s multilateral security institutions. ASEAN advocates for the early adoption of a binding Code of Conduct in the 30 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER South China Sea between China and ASEAN. This is why membership in ASEAN is a powerful weapon for Vietnam, and serves as the most effective way to deal with issues in the South China Sea. Economic and territorial frustrations aside, Vietnam is not planning to alienate one power in favor of the other. Vietnam’s Minister of National Defense, General Phung Quang Thanh, recently stated that Vietnam seeks to expand defense cooperation “with all countries…and Vietnam would like to have fine relations with neighboring countries, regional countries, and major powers of the world, and especially the U.S. and China.”32 Strategy In order for the United States to maximize the security relationship with Vietnam and cultivate a new strategic partnership, it must reorient its military-to-military policies from a direct security relationship, which is ultimately capped by Vietnam’s sensitivity to China’s reactions, to an indirect strategy that pushes Vietnam towards the Alliance of Southeast Asian Nations (ASEAN). Encouraging this multilateral and institutional approach serves U.S. security and strategic objectives by advancing U.S. regional goals and increasing its strategic partnership with Vietnam without upsetting the balance it maintains between U.S. and Chinese relations. The United States must also increase efforts towards Vietnam’s domestic development and economic initiatives to help garner favor, and indirectly cultivate a critical strategic partner.

Bypassing Constraints via ASEAN – Strength in Numbers Much of Vietnam’s foreign policy orientation is already actively directed towards ASEAN and coincides with advancing the agenda of the U.S. rebalance strategy to the Asia-Pacific.33 Washington now views Vietnam as a rapidly developing middle-power with more than 93 million people, and Hanoi has worked to expand its leadership role in Southeast Asia.34 Despite an alignment on an array of regional security topics, Vietnam’s senior leadership point toward the fact that Vietnam will only cooperate with the United States up to a certain extent, and will not ally with it 31 VOLUME XXIII, NUMBER 1 · FALL 2014

ESTABLISHING A NEW U.S.-VIETNAM SECURITY RELATIONSHIP against China.35 Vietnam’s foreign policy alludes to three constraints: no foreign alliances, no foreign bases, and no bilateral relations directed against a third party.36 Directing Vietnam more and more towards ASEAN helps to bypass these constraints by avoiding offending China. China cannot easily react with consequence towards a coalition of countries, each with significant economic ties to China, and an emerging collective maritime security architecture. The United States uses ASEAN as a vehicle to provide support, coordinate training, and develop its regional objectives. Increased participation in ASEAN activities can be seen by Washington as increased partnership with the United States.

Mil-to-mil Reorientation – Strategic Support Reorienting U.S. military-to-military efforts with Vietnam from limited bilateral discussions to training that supports ASEAN will maximize the security relationship in a manner less offensive to China. In particular, naval activities can help achieve strategic convergence through training that supports ASEAN’s goals of a maritime security architecture.

Maritime law enforcement training with Vietnam’s Navy and Coast Guard would enhance Vietnam’s and ASEAN’s efforts in combating narcotics trafficking, human trafficking, and other transnational crimes.37 Coastal patrol training with the Vietnamese Navy and Coast Guard, along with U.S. maintenance and training packages to build maritime security capabilities, would help to accomplish shared (Vietnamese, ASEAN, and U.S.) objectives in maintaining freedom of navigation and the sustainable use of ocean resources.38 These naval engagements and activities, although not yet exercising combat skills, bolster ASEAN’s goal of creating a regional multilateral security architecture. The Vietnamese acknowledge that building their military individually will not help to build diplomacy within the region. Through membership consensus, ASEAN offers a route to negotiations on territorial disputes in the South China Sea. A U.S. focus on efforts to achieve joint goals regarding transshipment routes for weapons of mass destruction and related items would improve Vietnam’s reputation among ASEAN member states. Vietnam’s busy, unregulated ports are currently weak links in the international export 32 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER control chain.39 Proliferation concerns stem from Vietnam’s recent efforts to develop civil-nuclear energy, gaps in trade control systems, lack of nonproliferation awareness, and weak law enforcement.40 Finally, the United States should seek to achieve shared objectives regarding nontraditional threats such as environmental security, and regional interoperability like multilateral search and rescue coordination, regional humanitarian assistance and disaster relief.41 Reorienting U.S. military efforts from bilateral initiatives restricted by a Chinese ceiling to critical training objectives shared by Vietnam and ASEAN reaches the U.S. desired end-state for the overarching security relationship.

Vietnam’s Domestic Development – Focusing Inward Issues regarding the South China Sea explicitly bind U.S.-Vietnam affairs because the United States has a clear interest in freedom of navigation as the world’s foremost maritime power. However, a meaningful long-term relationship must be underpinned by a much broader foundation.42 An important component to this foundation is Vietnam’s domestic development. This is a strategic investment for the United States because China’s development efforts pale in comparison. As the second largest account in the Foreign Operations Budget for Vietnam, Development Assistance funding levels should continue to increase. These funds are invested through partnerships with the private sector, educational establishments, and non-governmental organizations (NGOs) focusing at both the national and provincial levels.

The United States should focus development assistance on human rights, rule of law, and promoting good governance and enhanced government accountability. U.S. development efforts should also focus on greater citizen participation, increasing transparency, and improving the quality of education, instrumental in strengthening the skilled labor force. These areas are critical for Vietnam’s transition to a modern industrial economy.43 These domestic efforts respond directly to Vietnamese leaders’ goals for support and mirror international campaigns. Garnering approval from other states and international organizations will lend 33 VOLUME XXIII, NUMBER 1 · FALL 2014

ESTABLISHING A NEW U.S.-VIETNAM SECURITY RELATIONSHIP credibility, and potentially funding, to U.S. efforts and expand Vietnamese cooperation with U.S.-supported goals.

Continued Economic Relationship – Trade and Stability This meaningful long-term relationship must also be reinforced by comprehensive economic relations. With more than $10 billion invested in more than 600 projects, the United States is currently the seventh largest investor in Vietnam.44 The United States was the top export market for Vietnam in 2012 with bilateral trade reaching $25 billion.45 With both China and the United States vying for influence in mainland Southeast Asia, the Trans-Pacific Partnership (TPP) has become an increasingly important aspect of the relationship.

Although Vietnam is the least developed economy among the prospective TPP members, U.S. officials supported Vietnam’s full participation in the TPP and agreed to an early conclusion to negotiations on the regional freetrade agreement.46 Although this is an economic-based underpinning of trade and capital, strong economic relations will help make joint strategic alignment possible.

Analysis This strategy takes a multilateral and institutional approach to shaping Vietnam as a strategic partner. There are a number of regional entities to serve as points of influence: the Asia-Pacific Economic Cooperation (APEC), the ASEAN Regional Forum (ARF), the East Asia Summit (EAS), the Nuclear Security Summit, the U.S.-ASEAN Summit, and the ASEAN Defense Ministers Meeting Plus (ADMM+).47 These institutions provide legitimate venues to communicate in constructive ways to shape relationships and pursue national interests. A multilateral approach is also 34 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER most congruent with U.S. grand strategy by bolstering fundamental interests of security, economic prosperity, and humanitarian efforts, as well as with U.S. National Security Strategy aimed at strengthening Asian alliances.48 U.S. grand strategy also calls for resisting fear and overreaction, focusing on engagement and sound international order through institutions and organizations, which this approach to shaping Vietnam epitomizes. Multilateralism, propped up by strong bilateral arrangements, is the most effective way for the United States to approach Southeast Asia’s dilemmas, including access to the South China Sea.49 Multilateralism is also well-synchronized with Vietnam’s foreign policy, which has a prevailing theme of international integration. While Vietnam previously emphasized only domestic economic growth in order to avoid potentially destructive relationships, security and regional politics are increasing in prominence. Vietnam has increasingly looked to ASEAN as a pillar of its foreign policy, evidenced by its focus on concepts of community-building, economic connectivity, and the South China Sea when it chaired ASEAN in 2010.50 Providing massive economic benefit to Vietnam, bilateral trade with ASEAN was near $38 billion in 2012, representing 17 percent of Vietnam’s total trade.51 As Vietnam’s third largest market for exports after the U.S. and the European Union (E.U.), ASEAN’s imports from Vietnam surpassed $17 billion in 2012.52 ASEAN serves as Vietnam’s bridge and safety net, a factor that enhances a U.S. strategy that encourages ASEAN participation.

Geo-strategically, Vietnam has membership benefits in APEC, the World Trade Organization (WTO), and anticipated benefits from the TPP, in part because of its ASEAN membership. Such free trade agreements enable Vietnam to meet international standards for macroeconomic policies, helping Vietnam to address internal corruption and stimulating homegrown enterprises.53 Additionally, these trade agreements strengthened bilateral ties with major countries seeking ties with countries in the AsiaPacific region. Vietnam capitalized on this regional attraction by expanding relations with all permanent members of the United Nations Security Council, along with other significant states such as India, Japan, South Korea, and Australia.54 As a whirlpool of fluctuating interests and 35 VOLUME XXIII, NUMBER 1 · FALL 2014

ESTABLISHING A NEW U.S.-VIETNAM SECURITY RELATIONSHIP alliances evolve due to the maneuvering of major powers, the security climate of the region is growing increasingly complex. To navigate through this complex security environment, Vietnam needs ASEAN just as ASEAN needs Vietnam, whose market is among the three largest in ASEAN with more than 90 million people.55 A U.S. strategy that fortifies this natural alliance will prove most successful in tying Vietnam to U.S. goals and avoiding the limits of Sino-Vietnamese relations.

Advocacy A shift in policy toward Vietnam is merely a matter of tactics, not principles. Funding for efforts in Vietnam is currently more than $112 million, Vietnamese communities in the United States are increasing in size and power, and policy goals of the two nations are converging.

Highlighting the compatibility of a Washington-Hanoi strategy should encourage quick and extensive support for a new approach.

Winning Domestic and International Support – The Point of Convergence Cultivating Vietnam as a strategic partner by channeling it deeper into ASEAN is a course of action that will improve the sensitive war legacy issues, as well as the domestic development challenges. Extensive bilateral and multilateral cooperation helps to strengthen mutual trust, allowing Vietnam and the United States to develop a more forward-looking relationship and avoid an appearance of the American superpower flexing its muscles. Additionally, Vietnam’s omni-directional foreign policy orientation already directs Vietnam towards ASEAN and multilateralism; this strategy amplifies its existing momentum and intent.56 This strategy’s focus on regional and domestic issues bolsters international policy goals, which makes Vietnam more valuable to ASEAN, while earning domestic favor by increasing Vietnam’s international respectability and demonstrating the sophistication of Hanoi’s diplomacy.

The U.S.-ASEAN Business Council, the education and health sectors, human rights groups, U.S. and allied leaders, many Vietnam War veterans, the Vietnamese-American community, and most of all, the finance 36 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER community support an expansion of relations between the two nations. All these groups created pressure on the United States to stabilize relations with Vietnam, allowing the groups to make headway on their respective issues. Many are focused on the role a new U.S. policy can play in overcoming human rights and social obstacles in Vietnam. A major player in expanded relations is the Vietnamese American community, now 1.8 million strong and in its second generation. This community is vibrant and increasingly represented in local governments, small business, and advocacy groups. Further, approximately 17,000 Vietnamese students are studying at U.S. educational institutions, making Vietnamese students the largest community of all Southeast Asian students pursuing degrees in the United States.57 A shift in policy will likely require no convincing to these groups already declaring a need for change.

Counterarguments – Ideological Differences Arguments against establishing a security relationship and cultivating Vietnam as a strategic partner rest on its status as a communist state whose political reforms have lagged far behind economic change. Vietnam’s latest adopted constitution of 1992 reasserted the party’s core role in both politics and society, and Vietnam maintains its status as a one-party state.58 Yet the United States still holds substantial trade and security interests despite the communist regime. Forging a closer relationship is an opportunity to shape and encourage Vietnam’s foreign policy thinking in a stark contrast to the trajectories of other communist countries. This institutional and multilateral strategy of developing defense capabilities more closely resembles previous defense dialogues with the Philippines, Indonesia, and Thailand, relative model countries for Vietnam because of their successes in defense reform.59 The Philippine security sector is a clear example of a security program working simultaneously toward military modernization plans, and strengthening maritime domain awareness and law enforcement.

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ESTABLISHING A NEW U.S.-VIETNAM SECURITY RELATIONSHIP Vietnam’s Motivation – Becoming Greater Than Its Conflicts Geopolitically, Vietnamese leadership seeks regional stability and global integration; economically it seeks new foreign investment and markets for its export industries. These objectives all require good relations with the United States.60 Healthy ties with the United States will help to address the constraints that bind these objectives. Governance reforms, broadened and sustainable growth, and regional stability are objectives with which a large superpower can assist a mid-sized developing country. In addition, this strategy complements Vietnam’s efforts to internationalize its South China Sea disputes by urging outside powers to address the disputes with China; it also pressures China to enter multilateral discussions with other disputing countries, or even ASEAN, since China naturally prefers to deal with the disputes with each country bilaterally.61 Vietnam’s motivation would also be reinforced by Hanoi’s significant anti-Chinese constituency.

Ultimately, Vietnam is committed to a peaceful and stable security environment, demonstrated by its active participation in the changing security and political architecture unfurling in the region.

Recommendation Once characterized as foes, the United States and Vietnam now share overlapping strategic interests that prescribe the future trajectory of security cooperation. Washington must reorient its foreign policy towards Hanoi from a comprehensive partnership to a new strategic partnership.

This is best achieved through a multilateral and institutional approach which indirectly cultivates Vietnam through heavy channeling towards ASEAN participation. U.S. policy must seek to 1) bypass constraints imposed by Sino-Vietnamese relations, 2) reorient military-to-military efforts, 3) increase focus on Vietnam’s domestic development, and 4) continue to build upon economic underpinnings. This indirect cultivation 38 INTERNATIONAL AFFAIRS REVIEW

AARON SCOTT TURNER aligns with Vietnam’s omni-directional foreign policy of international integration and preserves Vietnam’s formation of a new international identity.

Endnotes 1

Raymond Burghardt, “U.S.-Vietnam: New Strategic Partners Begin Tough Trade Talks,” East-West Center, Asia Pacific Bulletin, no. 153, February 29, 2012, 1, http://www.eastwestcenter.org/news-center/east-west-wire/new-strategic-partners-us-andvietnam-begin-tough-trade-talks 2 Lewis M. Stern, “U.S.-Vietnam Defense Relations: Deepening Ties, Adding Relevance,” Strategic Forum, no. 246 (September 2009): 7, http://usacac.army.mil/ cac2/call/docs/10-51/ch_6.asp 3 Carlyle Thayer, “Vietnam and the United States: Convergence but Not Congruence of Strategic Interests in the South China Sea,” ISN, Center for Security Studies, ETH Zurich, Switzerland, February 13, 2013, 10, http://www.isn.ethz.ch/Digital-Library/ Articles/Detail/?id=159646&lng=en 4 Mark Manyin, “U.S.-Vietnam Relations in 2011: Current Issues and Implications for U.S. Policy,” Congressional Research Service, May 18, 2012, http://fas.org/sgp/ crs/row/R40208.pdf 5 Nguyen Manh Hung, “Vietnam-U.S. Relations: Past, Present, and Future,” East-West Center, Asia Pacific Bulletin, no. 69, September 24, 2010, 1 http://www.eastwestcenter.org/publications/vietnam-us-relations-past-present-and-future 6 Manyin, 20.

7 Ibid., 2.

8 Thayer, 4.

9 Ibid., 2.

10 William Buckingham Jr, Operation Ranch Hand: The Air Force and Herbicides in Southeast Asia, 1961-1971 (Washington, DC: University of Michigan Library, 1982), 72.

11 Ibid.

12 Ibid., 73.

13 Ibid., 74.

14 Ibid.

15 Ibid., 1.

16 Ibid.

17 Ibid.

18 Consolidated Appropriations Act, Regional Perspectives, East Asia and the Pacific, 2014, 304-309, http://www.gpo.gov/fdsys/pkg/BILLS-113hr3547enr/pdf/BILLS113hr3547 enr.pdf 19 Thayer, 12.

20 Central Intelligence Agency, “Vietnam, East & Southeast Asia,” https://www.cia.gov/library/publications/the-world-factbook/geos/my.html

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21

Thayer, 8.

Burghardt, 2.

23 Manyin, 25.

24 Ibid., 29.

25 Ibid.

26 Ibid., 28.

27 Ibid.

28 Ibid.

29 Ibid.

30 Manyin, 29.

31 Ibid., 10.

32 Thayer.

33 Hoang Anh Tuan, “High Hopes and New Realities for the Vietnam-U.S. Relationship,” East-West Center, Asia Pacific Bulletin, no. 225, August 1, 2013, 1, http://www.eastwestcenter.org/publications/high-hopes-and-new-realities-the-vietnamus-relationship 34 Burghardt, 1.

35 Thayer.

36 Ibid.

37 Manyin, 20.

38 Manyin, 10.

39 Department of State. Congressional Budget Justification Foreign Operations, Appendix 3: Regional Perspectives, 2015, 304-309, http://www.state.gov/documents/organization/ 224070.pdf 40 Department of State, 304-307.

41 Thayer.

42 Frederick Brown, “Rapprochement Between Vietnam and the United States,” Contemporary Southeast Asia 32, no. 3 (December 2010): 337, http://muse.jhu.edu/ journals/Contemporary_southeast_asia_ajournal_of_international_and_strategic_affairs/s ummary/v032/32.3.brown.html 43 Tuan, 1.

44 Ibid.

45 Ibid.

46 Burghardt, 2.

47 Tuan, 1.

48 Beck Hing Lee, “Vietnam’s Foreign Policy Reorientation,” (Ph.D. diss., Boston University, 2011) http://tic.car.chula.ac.th/tsunami/96-aec3/23984-vietnam-s-foreignpolicy-reorientation 49 Brown, 337.

50 Dinh Tinh Le , and Hai Long Hoang, “Vietnam in ASEAN and ASEAN in Vietnam,” East-West Center, Asia Pacific Bulletin, no. 242, November 21, 2013, 1, http://www.eastwestcenter.org/publications/vietnam-in-asean-and-asean-in-vietnam 22

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51

Ibid.

Ibid.

53 Ibid.

54 Ibid., 2.

55 Ibid.

56 Lee. 57 Tuan, 1.

58 Manyin, 26.

59 Stern, 8.

60 Burghardt, 1.

61 Manyin, 10.

52

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The Role of the Defense Department in Advancing the Responsibility to Protect in the Middle East Josh Khoury Josh Khoury is a recent graduate of the Elliott School’s Master of International Policy and Practice program at the George Washington University. He is currently serving as a US Army Middle East and North Africa Foreign Area Officer and has extensive experience living and working in the region. The ideas expressed in this article reflect the author’s personal views, and are not official policy of the United States Department of Defense, the United States Army, or any component parts.

He can be reached at josh_khoury@gwu.edu and via Twitter @JoshKhoury.

Abstract The Responsibility to Protect (R2P) is an emerging component of U.S. foreign policy and international norms. R2P recognizes that it is incumbent upon states to protect the human rights of their domestic populations in order to maintain their international sovereignty. When states willfully fail to live up to this obligation, the international community has an obligation to take action in order to protect the suffering population. The U.S. Department of Defense can ensure that U.S. foreign policy in the Middle East adheres to the tenants of R2P by effectively managing its security and intelligence cooperation activities to prevent and avoid atrocities, or failing that, to help rebuild in the wake of massive human rights violations.

Introduction Over the last decade, a new international norm referred to as the responsibility to protect (R2P), has emerged among international organizations, states, and non-governmental organizations. Ratified by Member States of the United Nations in 2005, R2P establishes a 42 INTERNATIONAL AFFAIRS REVIEW

JOSH KHOURY  responsibility for the international community to take action and potentially use force when a government fails to protect its citizens. R2P doctrine empowers international organizations, altering state sovereignty by making the principal of non-intervention conditional on the ability and willingness of a state to protect its citizens’ human rights.

The United States Department of Defense (DoD) should incorporate the principles of R2P into its bilateral military relations to prevent, avoid, and stop acts of state-sponsored mass violence in the Middle East. This paper will provide an overview of R2P and its implications for state sovereignty, provide three lines of efforts to advance R2P principles and norms through security cooperation, highlight the importance of senior-level defense officials in uniting the DoD effort overseas, and address the risks associated with these policy recommendations.

Background Many of the 21st century transnational security challenges are fundamentally different from those the world faced in the past.

Unfortunately, gross human rights violations, ethnic cleansing, and genocide are not unique to this age. While these horrific acts are similar to their historic predecessors, what has changed are the actors responsible for committing them, and the tools available to respond. The international community has grown to include non-state and supra-state actors and has correspondingly developed new tools to deal with these enduring transnational security threats, including the controversial R2P doctrine.

R2P and intervention for humanitarian purposes is controversial, for when it occurred in Bosnia, Kosovo, Somalia, and Libya; as much as when it has not, in Rwanda, Myanmar and Syria.

R2P is founded on two basic principles. First, state sovereignty inherently includes a responsibility to protect the population within the state boundaries. Second, where a population is suffering due to internal conflict or state failure, if the state is unwilling or unable to stop or avert it, the international community has an inherent responsibility to protect the suffering population. R2P prioritizes prevention principles by addressing 43 VOLUME XXIII, NUMBER 1 ¡ FALL 2014

ROLE OF THE DEFENSE DEPARTMENT the causes of conflicts and crises. Where prevention fails, reacting to humanitarian crises through regulated and proportional response mechanisms such as sanctions, international prosecution, or, as a last resort, military intervention may be necessary. Finally, R2P also includes a responsibility to rebuild – to provide international assistance in aiding with recovery, rebuilding infrastructure and state institutions after military intervention, and reconciling the conflicting parties.1 Effect of R2P on State Sovereignty R2P has a profound effect on states and international organizations because it expands the notion of sovereignty beyond the Westphalian state system. Proponents of R2P argue that this expansion of sovereignty strengthens states by helping them to meet what UN Secretary General Ban-ki Moon described as, “one of their core responsibilities” in protecting their people.2 Its critics, particularly UN ambassadors from non-Western states, have argued that it is an excuse to impose Western norms and neo-liberal interventions on weaker states.3 Oxford University professor of political theory Simon Caney sees more nuance in R2P wherein, “international law still protects sovereignty, but – not surprisingly – it is the people’s sovereignty rather than the sovereign’s sovereignty.”4 Philosophically, R2P challenges realist political theories which contend that while states have domestic political systems, the international realm is characterized by anarchy.5 R2P does not assume that states only act pragmatically to advance their national interests. In fact, it advances the belief that upholding high ideals of human sovereignty is a global interest. Therefore, regardless of whether one embraces or rejects R2P, the doctrine challenges pre-existing conceptions of state sovereignty and the international order.

Recommendations for US Military Relations in the Middle East The United States military has a role in ensuring U.S. interests, and in advancing norms and ideals through its partnerships with foreign militaries. For myriad political and strategic reasons, the U.S. military maintains partnerships with foreign security forces throughout the world.

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JOSH KHOURY Shared beliefs and norms have long been a key component of establishing coalitions and military partnerships, and that should extend to shared acceptance and proactive implementation of R2P. Critics within and outside the organization may argue that diplomacy and development are not the purview of the DoD. In reality, the U.S. military influences the actions of partner armed forces through regular interaction at the individual and organizational level, security cooperation programs, and intelligence sharing. These same processes can be used to ensure that R2P tenants of prevention, reaction, and rebuilding are incorporated into the doctrine, organization, and training of armed forces in the Middle East.

Line of Effort One: IMET, JCETs and SOLOs Through regular interaction at the organizational and individual level, the DoD has several venues to assist Middle Eastern militaries in fostering a culture that promotes the rule of law and protects human rights. Two such venues are International Military Education and Training (IMET) and Joint Combined Exchange Training (JCET). IMET is U.S.-based training of foreign military and civilian defense personnel. The DoD plays a critical role in identifying foreign military leaders to participate in U.S.based education and training as well as implementing the training program. The daily education and training is predominantly conducted alongside members of the United States military.

IMET can be an invaluable tool to inculcate foreign military leadership with democratic and international norms regarding the use of force and the respect of individual liberties.6 The program should be expanded to include a special school specifically for Middle Eastern officers and soldiers. Similar to the former “School of the Americas” which was successful in promoting democracy among Spanish-speaking militaries during the Cold War, the DoD should establish an Arabic-language institute for Middle Eastern military partners.7 Currently, most Middle Eastern IMET students attend training at U.S. military installations, with some receiving strategic-level education at the U.S. Army or Navy War College or the National Defense University.

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ROLE OF THE DEFENSE DEPARTMENT Â These programs are an excellent vehicle for educating and training foreign students alongside their American counterparts. However, by establishing an Arabic-language facility specifically for Middle Eastern students, the DoD will place greater emphasis on its military ties to the region and eliminate English-language fluency as a pre-requisite for attending U.S.based training. Depending on the country of origin, many senior officers from the Middle East may already be fluent in English, having previously studied in the United States or Europe. Still, a larger portion of the officer corps and non-commissioned officers cannot attend training due to the same language barrier.

In order to advance R2P principles, the curriculum at this institution should stress education on the rule of law, human rights, and professional ethics. Additionally, placing a cohort of Middle Eastern officers in training together will increase the international professional bonds among the alumni of this institution helping to establish a regional ethic that respects the rule of law and human rights, and holding the members of the profession accountable to each other. Finally, by assigning Arabicspeaking members of the U.S. military as instructors in this program, the military will expand its cadre of bilingual officers able to operate in the region with greater ease and efficiency. This will also create personal and professional ties between the cadre and students.

JCETs are conducted by U.S. Special Operations Forces with foreign counterparts and focus on counter-insurgency, anti-terrorism, counterpiracy and counter-narcotics tactical training at the small-unit level.

Middle Eastern states allocate greater training resources to their Special Forces units, which are used to confront transnational threats and as tools of regime preservation.8 Because well-trained Special Forces are a high priority in the region, JCETs should occur with greater frequency and duration and should prioritize training higher levels of command and staff.

JCETs should expand beyond tactics to include training on how to develop doctrine and organizational formation that will meet the challenges of internal and transnational threats, while still preserving the rule of law and protecting civil liberties. In this way, U.S. advisors can help to incorporate doctrine into the culture and regulations of partner nation special forces 46 INTERNATIONAL AFFAIRS REVIEW

JOSH KHOURY that bears particular relevance to concepts of R2P by incorporating highly trained medical, engineering, and civil affairs units into SOF organizations. Not only are medical and engineering personnel a critical component to sustaining SOF during combat, but they also can assist with identifying and treating victims of human rights violations and key civilian infrastructure. The combination of in-house civil affairs units, medical and engineering personnel can greatly multiply the access and effectiveness of special forces during R2P interventions. High-level JCETs can also be used to assist military leaders in differentiating between threats to the state and threats to the ruling regime and delineate the differences between the two in military doctrine.

Former USSOCOM Commander, Admiral Bill McRaven, embraced high level JCETs by establishing Special Operations Liaison Officers in ten U.S. embassies.9 SOLOs are assigned to U.S. embassies to coordinate Special Operations activities between the United States and partner nation’s special operations forces. SOLOs are typically assigned for up to three years in order to build a deeper relationship with partner SOF commands. By virtue of their higher rank they enjoy greater access to senior foreign special operations commands, a further network of senior military officers, and foreign security officials. Their extended assignment compared to a typical JCET also allows them to coordinate long-term projects, observe and influence their foreign counterparts over their career progression, and gain greater insight into the political and socioeconomic influences on foreign special operations forces. The SOLO becomes a trusted partner and in so doing, the SOLO is a critical node in ensuring that Middle Eastern special forces will be less likely to commit atrocities against their own populations, actively preventing humanitarian crises.

Line of Effort Two: Joint Training Exercises, Foreign Military Sales and Foreign Military Financing Joint training exercises can vary in scale from two countries to a multinational coalition or alliance, and from a small group of staff and planners to a large-scale deployment of air, land and naval forces. These exercises particularly focus on building inter-operability and forming 47 VOLUME XXIII, NUMBER 1 · FALL 2014

ROLE OF THE DEFENSE DEPARTMENT international partnerships. Additionally, they should rehearse scenarios preventing and reacting to human rights violations, as well as operational planning for rebuilding after major human rights violations that could potentially occur after an R2P intervention.

The Eager Lion exercise is a recent example of incorporating prevention and response to human rights violations into joint training. This annual exercise, held in Jordan since 2011, is the largest of its type in the Middle East. Last year approximately 8,000 personnel from 19 different countries participated in the training, which “integrated defense and humanitarian assistance and disaster relief to address current and future conflicts’ security issues.”10 Even though Eager Lion organizers quickly and repeatedly pointed out that the exercise was not a direct response to the ongoing civil war in Syria, the participation of armed forces from the United States and other Middle Eastern states so close to the Syrian conflict was a clear signal to the Assad regime that military action could quickly follow a political resolution. This year the exercise was expanded to include over 12,500 personnel from 20 countries, including a combined air force with participation from Turkey and Saudi Arabia; it also included training for humanitarian assistance.11 IMET, JCETs and joint training exercises are all covered by Section 620M of the Foreign Assistance Act of 1961. Also known as the Leahy Amendment, it requires that all foreign security assistance and training be preceded by screening the nominated individuals and units for human rights violations with State Department databases, media sources and affiliated NGOs.12 Recipients of IMET, JCET and other training should all be thoroughly screened for human rights violations. This requires close monitoring of individuals, more so than military units because individuals can easily be transferred between units and units are often re-designated with new identification information. Therefore, tracking individuals across time and throughout their military careers is highly preferable and far more effective than identifying units that have committed human rights violations in the past. Unfortunately, monitoring individuals for human rights violations is also much more difficult.

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JOSH KHOURY Security cooperation can also occur through Foreign Military Sales (FMS), the purchase of U.S. security-related materiel by foreign governments, or Foreign Military Financing (FMF), financial aid provided by the United States to foreign governments that is subsequently used to purchase American equipment. These financial aid programs, like IMET, are State Department programs managed by the Department of Defense with strict Congressional oversight. To support R2P goals, financial aid programs should place more focus on major defense articles such as tanks, warships and fixed-wing aircraft which are used to defend and deter foreign invasion and less on possible tools of repression: small arms and sniper rifles; less-than-lethal crowd dispersal weapons and ammunition; or rotary wing aircraft.

Some may argue that limiting defense-related financial aid to “big ticket” items would not be appropriate in the modern Middle East, because they may be captured and used by any number of terrorist organizations and sub-state threats to regional security. Yet it would be difficult to believe that a lack of weapons in the hands of the military may have contributed to the rise of the Islamic State, Al Qaeda or its associated organizations in Syria, Iraq, Yemen, or Libya more so than societal, political, and economic grievances the governments have failed to address. Where the militaries in the region have failed to prevent the spread of terrorist organizations within their own borders it has not been due to a lack of firepower, but a lack of organization, training, and logistical support. Therefore, the United States should make defense-related financial aid conditional on concrete action to address the root causes of instability and strictly limited to those items which are used to deter foreign aggression or participate in coalition operations against hostile regimes.

Security assistance should be tied to long-term security needs and goals, and not as a reaction to current events. In their study of U.S. military 49 VOLUME XXIII, NUMBER 1 · FALL 2014

ROLE OF THE DEFENSE DEPARTMENT Â assistance and FMF from 1950 to 2007, Anderson and McCauley found that Executive administrations managed these tools in an ad hoc manner, often responding to wars, attacks, coups, natural disasters or U.S. domestic concerns instead of long-term planning or ideology.13 The Jordanian example provides a strong counterpoint to this trend where the United States has committed to an annual FMF of $300 million despite a decreased total foreign aid budget due to military commitments in Iraq and Afghanistan. This military aid is part of a larger five year economic aid package which also seeks to address developmental goals including democratization, water preservation and education.14 Line of Effort Three: Intelligence Sharing Finally, intelligence sharing by DoD subordinate elements is another way the U.S. government uses its military influence to shape and influence the conduct of foreign governments.15 The United States maintains a robust technical and human intelligence capability that it shares selectively (at its discretion) with partner nations in order to provide relevant information on issues of mutual concern. Intelligence collaboration should only occur within military channels for military purposes, and not with the internallyfocused national intelligence agencies common in the Middle East. In this way, the DoD can ensure that the intelligence it provides to Middle Eastern militaries remains focused on the legitimate protection of state sovereignty and not on identifying internal actors or movements which may threaten the regime.

International terrorist organizations are a clear threat to state sovereignty as they erode the rule of law and fail to respect basic human rights.

Therefore under the R2P doctrine, with regard to mutually identified terrorist organizations it is incumbent on U.S. military intelligence organizations to conduct intelligence liaison with their Middle Eastern counterparts in order to prevent humanitarian crises. What intelligence sharing should not include is the provision of information or tools to collect intelligence which can be used against legitimate and peaceful political opposition to the ruling regimes, or turning a blind eye when such 50 INTERNATIONAL AFFAIRS REVIEW

JOSH KHOURY infractions do occur. Doing so would prioritize state sovereignty over individual sovereignty and thus run counter to the tenants of R2P. The Role of the Senior Defense Official/ Defense Attaché If there is one person uniquely empowered and capable of implementing these three lines of effort, it is the Senior Defense Official/Defense Attaché (SDO/DATT). The SDO/DATT is the Chief of Mission’s principal advisor on defense issues and the senior diplomatically accredited DoD military officer assigned to a U.S. diplomatic mission. All diplomatic elements under COM authority are under the coordination authority of the SDO/DATT, except for the Marine security guard detachment and Naval support units.16 The SDO/DATT has a close working relationship with the ambassador and ensures that the Unified Country Plan (UCP) is implemented with full DoD support. Although SOLOs work directly for the Theater Special Operations Command (TSOC), their work is coordinated by the SDO/DATT. The SDO/DATT heads the Security Cooperation Office, responsible for implementing the FMS and FMF programs in the assigned country as well as planning and coordinating joint training exercises and IMET. In addition, the SDO/DATT manages all activities of the Defense Attaché Office.

Finally, the SDO/DATT reports directly to the Geographic Combatant Commander, in the case of the Middle East, this is the CENTCOM Commander. In that capacity the SDO/DATT has a critical function in reporting through the DoD chain of command the “ground truth” within their assigned country. The SDO is best positioned to notify senior government officials of potential or actual human rights abuses. Through their daily interactions with host nation military leadership, the SDO/DATT has the best sense of whether a foreign military may possibly commit human rights violations and influence them to prevent such action.

If abuses do occur, the SDO/DATT can quickly take action to rectify the situation. Additionally, if human rights abuses are occurring in the region, the SDO/DATT is in a position to know if the host country is preparing to, 51 VOLUME XXIII, NUMBER 1 · FALL 2014

ROLE OF THE DEFENSE DEPARTMENT or willing to, take military action to intervene. Lastly, should human rights violations occur and a rebuilding process becomes necessary, the SDO/DATT can assess and prioritize rebuilding efforts – whether in their assigned country or within the region.

Risks Assessment The greatest risk in implementing these policy recommendations is that they will not be sufficient to prevent human rights violations. The United States may still be compelled to use military force to prevent large-scale human rights violations. Most analysts would point to Egypt as an example in the region where U.S. security cooperation efforts have not advanced democratic norms. Egypt’s new President Abdel Fatah Al-Sisi came to power via a military coup, and while he was head of the Egyptian Armed Forces, the military conducted brutal crackdowns on political and religious protests. AlSisi is also a graduate of the U.S. IMET program, having attended the U.S. Army War College and writing his thesis on “Democracy in the Middle East.”17 Second to Israel, Egypt has been the largest recipient of military aid globally since the Camp David Accords. The United States and Egypt conducted bi-annual training exercises since 1981 until the United States suspended Operation Bright Star in the wake of the Egyptian revolution in 2011. However, it is through the bilateral military relationship that the United States has been able to maintain open lines of communication with the Egyptian government throughout the volatile last four years, and likely minimized the levels of violence.

In Libya (which had not received U.S. security assistance) and Yemen (which did) the military split into factions and civil wars erupted.18 In Syria, the story is the same and the end is uncertain.19 What this analysis indicates is that the military is a unique state institution because its support is necessary for an authoritarian regime to commit human rights 52 INTERNATIONAL AFFAIRS REVIEW

JOSH KHOURY violations. This appears to be a more compelling reason for using bilateral relationships to foster a culture that respects human rights amongst the military elite, not a justification for limiting security assistance. Security cooperation does not cause human rights violations, but it may prevent them from occurring.

Another very valid critique is that security assistance may end up benefiting the very forces responsible for committing human rights violations. Certainly as events are unfolding in Iraq, U.S. policymakers and defense analysts are rightfully concerned that equipment valued at nearly $30 billion was insufficient to defend large portions of the country and now it is being used by transnational terrorist organizations.20 As sectarian militias gather strength in Baghdad and other Shiite-dominated regions of Iraq, it is very possible that the equipment and training the DoD provided to the Iraqi Security Forces will be used to promote and prolong ethnic cleansing, genocide and sectarian strife across previous geographic borders.21 As a result, the United States has assembled a coalition and begun military operations to stabilize Iraq and the region. However, proponents of R2P would propose an alternative scenario to the current dilemma in Iraq. They would argue that had the United States and partner militaries invoked R2P in Syria several years ago, the civil war could have been contained and the fighting in Iraq averted.

Other critics of R2P doctrine point to Libya, the most recent example of its use, as a warning against invoking it again in the future. In Libya, the United States and European, African Union and Arab League partners controversially used the R2P doctrine as justification for military intervention under UN Security Council Resolution 1973. This was the first humanitarian intervention of this scale since the Rwandan genocide.

Through targeted air and sea-based attacks on critical government infrastructure, the coalition prevented a pending humanitarian disaster in Benghazi and supported the Transitional National Council, thereby leading to the overthrow of the Qaddafi regime.22 Similar to the 2003 invasion of Iraq, Operation Odyssey Dawn in Libya quickly led to regime change, but failed to address internal fractions which caused instability in the ensuing years. Viewed through the three tenants of R2P doctrine, 53 VOLUME XXIII, NUMBER 1 · FALL 2014

ROLE OF THE DEFENSE DEPARTMENT Libya is an example of world powers excelling at prevention and reaction, but falling short in rebuilding.

The responsibility to rebuild may be the most difficult and risky component of the R2P doctrine. Should the United States invoke the “responsibility to protect” as a justification for another intervention in the Middle East, it would entail a political, military and economic commitment to see the rebuilding effort come to fruition. Historical examples of the recent past in Libya and Iraq indicate that the United States and its partners do not take the responsibility to rebuild seriously.

The Marshall Plan, the United States’ commitment to rebuild Europe after World War II, is often considered the “gold standard” of rebuilding after major catastrophe. The military component of the Marshall Plan was in large measure motivated by the desire to balance the Soviet threat during the height of the Cold War. It is unlikely that an equivalent threat would provide similar motivation in the Middle East to create the political will necessary for a large scale rebuilding effort in any of the region’s current hot zones. Even the rapid spread of the Islamic State does not provide the existential threat that the Soviet Union posed to the United States.

Therefore, critics of security assistance are partially correct that it is not sufficient to prevent human rights violations. Nor will security assistance be enough to influence or enable Arab partners to prevent human rights violations in the region unilaterally. The policies recommended are not intended to cover the entirety of U.S. foreign policy, but they are three important steps to advancing the R2P norm in the region. Absent diplomatic, developmental, economic, and informational policies that work to reinforce security policy and address other sources of instability, security policy will fail to achieve its diplomatic and political goals.

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JOSH KHOURY Conclusion Since 2011, the Middle East and North Africa has witnessed multiple regime changes. As violence continues to unfold across the region, close analysis indicates that the military has a critical role in determining whether states will fracture, acquiesce to demands for political reform and regime change, or respond oppressively. Throughout the last decade R2P has emerged as a controversial challenge of sovereignty. The United States has embraced the concept, using it as a justification for military intervention in Libya and other actions in Syria.

By increasing the scope of IMET and JCET programs, incorporating human rights violations scenarios into joint training exercises, focusing financial aid on defense and deterrence-specific items, and judiciously conducting intelligence sharing, the DoD can effectively advance R2P as an international norm in the Middle East. The Senior Defense Official will be instrumental in implementing these policies abroad, in close collaboration with the Ambassador and other members of the country team and under strict Congressional oversight. Doing so will decrease the likelihood of future human rights violations, encourage and enable Middle Eastern states to react when human rights violations do occur in the region, and increase the speed of rebuilding that must occur in the states and populations which have experienced severe national trauma. While these policy recommendations will not address all of the sociopolitical cleavages in the region, they will go a long way in ensuring the region is willing and able to respond in the event of mass human rights violations.

In an environment of economic austerity and reluctance for direct military intervention, the DoD has planned to shape its force under the assumption that “unprecedented levels of global connectedness provide common incentives for international cooperation and shared norms of behavior, and the growing capacity of some regional partners provides an opportunity for countries to play greater and even leading roles in advancing mutual security interests in their respective regions.”23 This signifies that the United States is not abandoning its leadership role in the world, but that it will demand other states contribute more to preserving international order 55 VOLUME XXIII, NUMBER 1 · FALL 2014

ROLE OF THE DEFENSE DEPARTMENT and stability. The policies outlined in this paper are one avenue to pursue international cooperation and enable regional powers to play leading roles in the Middle East. In the end, it is more important and more effective for Arab states to embrace and enforce human rights and personal sovereignty than for such norms to be imposed on them from outside.

Endnotes 1

Gareth J. Evans and Mohammed Sahnoun, “The Responsibility to Protect: Report of the International Commission on Intervention and State Sovereignty,” International Development Research Centre, December 2001, XI-XIII, http://responsibilitytoprotect.org/ICISS%20Report.pdf. The work of Evans and Sahnoun was the basis for the “Responsibility to Protect” paragraphs (138-139) in the Outcome Document of the 2005 UN World Summit.

2 Ban Ki-Moon, “Secretary-General Defends, Clarifies ‘Responsibility to Protect’ at Berlin Event on ‘Responsible Sovereignty: International Cooperation for a Changed World,” United Nations, July 15, 2008, http://un.org/press/en/2008/sgsm11701.doc.htm 3 “To Protect Sovereignty, or to Protect Lives?” The Economist, May 15, 2008, http://www.economist.com/node/11376531 4 Stevie Martin, “Sovereignty and the Responsibility to Protect: Mutually Exclusive or Codependent?” Griffith Law Review 20, no. 1 (2011): 155.

5 Simon Caney, Justice Beyond Borders: A Global Political Theory. (New York: Oxford University Press, 2005), 226-262.

6 Michael J McNerny, “Assessing Security Cooperation as a Preventative Tool,” RAND, 2014, 92-93, http://www.rand.org/content/dam/rand/pubs/research_reports/RR300/ RR350/RAND_RR350.pdf McNerny tests the link between security cooperation and state fragility and the effectiveness of security cooperation as a preventive tool. This is particularly relevant to this paper because state stability and human rights violations are also directly related. (pp. 18-19) Therefore, by connecting security cooperation to state stability and then to human rights violations, security cooperation is proven to be a more powerful component of national security. Unfortunately, McNerny’s study did not include Israel and Egypt (pp. 28-29), the two largest recipients of U.S. security cooperation aid and two states with controversial human rights records.

7 Barry L. Brewer, “United States Security Assistance Training of Latin American Militaries: Intentions and Results.” (Thesis, Air Force Institute of Technology, 1995), 7, http://www.dtic.mil/dtic/tr/fulltext/u2/a301595.pdf 8 James T. Quinlivan “Coup-Proofing: Its Practices and Consequences in the Middle East,” International Security 24, no. 2 (1999): 141-148.

9 Eric Schmitt and Thom Shanker, “A Commander Seeks to Chart a New Path for Special Operations,” New York Times, May 1, 2013, http://www.nytimes.com/2013/5/02/us/politics/admiral-mcraven-charts-a-new-path-forspecial-operations-command.html?pagewanted=all

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10

Hendrick Simones, “U.S. participating in international Eager Lion exercise in Jordan,” Stars and Stripes, June 12, 2013, http://www.stripes.com/news/us-participating-ininternational-eager-lion-exercise-in-jordan-1.225511 11 Jeff Schogol, “About 6,000 U.S. troops headed to Jordan for military exercise,” Military Times, May 20, 2014, http://www.militarytimes.com/article/20140520/ NEWS08/305200052/About-6-000-U-S-troops-headed-Jordan-military-exercise 12 U.S. Department of State. 2013. “An Overview of the Leahy Vetting Process,” July 2009, http://www.humanrights.gov/2013/07/09/an-overview-of-the-leahy-vetting-process/ 13 David A. Anderson and Randall McCauley. 2009.“Ideology or Pragmatism? U.S. Economic Aid, Military Assistance, and Foreign Military Sales: 1950-2007,” Strategic Insights VIII, no.3 (August 2009).

14 Jeremy M. Sharp, “Jordan: Background and US Relations” Congressional Research Service, May 8, 2014, 13 http://fas.org/sgp/crs/mideast/RL33546.pdf 15 Mark M. Lowenthal, Intelligence: From Secrets to Policy, 5th ed., (Washington, DC: Sage, 2012): 345-374.

16 U.S. Department of Defense, “Directive 5205.75, DoD Operations at U.S. Embassies,” (Washington, DC: Department of Defense, December 4, 2013) http://www.dtic.mil/whs/ directives/corres/pdf/520575p.pdf 17 Abdel Fatteh Al-Sisi, “Democracy in the Middle East” (Thesis: US Army War College, 2006).

18 Zoltan Barany, “Comparing the Arab Revolts: The Role of the Military.” Journal of Democracy 22, no. 4 (October 2011): 24-35.

19 Eva Bellin “Reconsidering the Robustness of Authority in the Middle East: Lessons from the Arab Spring,” Comparative Politics 36, no. 2 (January 2004): 139-157.

20 Suadad Al-Salhy and Tim Arango, “Sunni Militants Drive Iraqi Army Out of Mosul,” New York Times, June 10, 2014, http://www.nytimes.com/2014/06/11/world/middleeast/ militants-in-mosul.html 21 Alissa J. Rubin and Durad Adnan, “Iraq’s Hold on Border Crossings Weakening as at Least 34 Are Killed in Battle,” New York Times, June 20, 2014, http://nytimes.com/ 2014/06/21/world/middleeast/top-shiite-cleric-in-iraq-urges-inclusive-government.html 22 Elizabeth Dickinson, “Does the World Belong in Libya’s War?” Foreign Policy, March 18, 2011, http://foreignpolicy.com/articles/2011/03/18/does_the_world_belong_ in_libyas_war 23 U.S. Department of Defense, “Quadrennial Defense Review 2014” (Washington, DC: US Department of Defense, March 2014): iii.

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INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE

Inside North Korea’s State-Sanctioned Criminal Empire Christina Gathman Christina Gathman is a Master’s candidate in International Affairs at The George Washington University’s Elliott School of International Affairs, where she specializes in the Middle East and International Security Studies. Her studies at the Elliott School brought her to Beirut, Lebanon, where she lived and worked for eight months. Christina received her B.A. in International Relations and Philosophy from Tulane University.

Abstract The government of the Democratic People’s Republic of Korea (DPRK) has managed to develop an elaborate state-run criminal enterprise with both domestic and international dealings despite the extremely closed-off nature of the North Korean state. The DPRK runs its highly-organized criminal organizations out of an office known, among other names, as Bureau 39. The activities managed by Bureau 39 range from international narcotics trafficking, to the manufacture of counterfeit goods, to insurance fraud. Over the years, in the face of greater visibility, both the activities undertaken by Bureau 39 as well as its means for carrying out these activities have adapted, however they have not necessarily decreased. Thus, North Korea’s sophisticated criminal network continues both to enable the state to acquire hard currency to be used domestically for its own nefarious purposes as well as allow the state to export its criminality, posing a dual threat to both regional and international security.

Introduction History has seen few examples of a state as directly complicit in criminal activity as North Korea. Two aspects of organized crime in the Democratic People’s Republic of Korea (DPRK) make it a particularly 58 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN interesting case. First, criminal penetration of the government is extreme and widespread, with nearly all levels of the state apparatus involved in criminal activities.1 Second, along with this unprecedented level of criminal penetration, the manner in which the government began to undertake criminal activity is unique. Criminal infiltration in government is generally viewed as a bottom-up phenomenon, wherein crime slowly penetrates the government, growing more influential over time. In North Korea, however, the reverse has happened; the DPRK’s government has been so actively involved in organized crime that it has become the most pervasive actor in all of the country’s criminal activities. This criminalization process has taken place over a significant period of time.2 There have been over fifty documented instances of individuals connected directly to the North Korean government perpetrating organized criminal activities occurring in at least 20 different countries. A large part of this sampling has involved DPRK diplomatic officials being either taken into custody or imprisoned by officials in these various foreign nations.3 The total income generated from the DPRK’s illicit undertakings was, as of 2005, thought to be in the range of $500 million.4 North Korea falls into the category that Michael Miklaucic and Moises Naim define as a criminal sovereignty.5 As a criminally sovereign state, North Korea “functions effectively as a criminal enterprise with the apparatus of the state itself directly engaged in criminal activity as a matter of policy.”6 The DPRK is able to take advantage of the distinct resources it possesses as a sovereign nation-state, and uses those resources to perpetrate its criminal activities. This paper focuses on the mechanisms through which North Korea orchestrates its criminal activities and addresses some of the major criminal operations that the state undertakes.

In addition, the paper addresses the DPRK government’s use of violence and corruption when pursuing these criminal activities, the steps taken to combat these activities, and the future implications of North Korean organized crime.

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INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE Bureau 39 All state-sanctioned criminal activity in North Korea is conducted through a governmental organization known as Bureau 39.7 The Bureau arose out of a set of economic reforms aimed at safeguarding the economic security of the ruling elite and increasing the state’s funds beyond the large subsidies provided by the Soviet Union.8 These reforms first began with the formation of what is known as a “royal court economy” in the state, or rather a “special sector with particularly extensive rights and powers” that is “accountable directly to higher party leadership and well isolated from the mainstream economy of the DPRK.”9 Bureau 39 emerged from this special royal court economy.

Despite the prevailing belief that North Korea’s involvement with organized crime began in the 1990s as a response to the collapse of its main benefactor, the Soviet Union, this is not the case. Rather, the DPRK’s heavy involvement in organized crime began with the 1974 establishment of Bureau 39 by Kim Jong-il.10 The establishment of the bureau was spurred by the DPRK’s loss of access to international credit following a default in the 1970s, leaving it wholly dependent on Soviet subsidies.11 Bureau 39, operated under the direct guidance of Kim Jong-il years before he was to take control of the country, provided the DPRK with a relatively stable source of financing.12 Bureau 39 was formed with the main purpose of acquiring hard currency for the state, and was mandated to do so by any means necessary.13 This is an important distinction to make—the modus operandi of North Korean criminal activity has never been crime for crime’s sake; the objective has always been hard currency. Obtaining foreign currency is especially crucial for a country that has been aggressively sanctioned in recent years, has been unable to borrow internationally since the 1970s, and whose 60 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN currency, the won, is essentially valueless for foreign transactions.14 The Bureau, which reportedly brings in between $500 million to $1 billion per year, fills the niche between the country’s hard currency requirements and its actual ability to meet these needs.15 Though it operated throughout the 1970s and 1980s, Bureau 39 was especially active in the 1990s. That decade saw a large intensification of state-sanctioned criminal activities, which likely occurred for three main reasons.

First, in 1990, a struggling Soviet Union altered the terms of its deal with the DPRK, requesting that any further imports be purchased with hard currency. The country also demanded that the overleveraged state balance its accounts with the Soviet Union, a debt which at the time amounted to $4 billion.16 Second, the collapse of the Soviet Union just one year later, in 1991, led to the cessation of food and fuel subsidies which counteracted the DPRK’s lack of natural resources. The third reason has to do with the transfer of leadership to Kim Jong-il. Following the death of Kim Il-sung in 1994, the North Korean leadership was replaced with a “younger group, less committed to the dogma of socialism and seemingly more eager to experience the good life.”17 The creation of Bureau 39 was an attempt to legislate a financial support mechanism for regime elites as well as for Kim Jong-il’s own future political succession.18 The office was designed as a department-level organization within the Korean Workers Party (KWP) Secretariat, under the KWP Central Committee, and was explicitly made completely independent of the DPRK government’s cabinet, including the cabinet’s economic planning process.19 Today, Bureau 39 still feeds the special court economy, which constitutes around 30 to 40 percent of North Korea’s larger state economy.20 From a logistical standpoint, the headquarters of Bureau 39 employs an estimated 130 individuals in its downtown Pyongyang offices who organize and oversee the state’s foreign ventures and undertakings, as well as run large domestic facilities used to further North Korea’s illicit activities.21 Through the ten departments it houses, Bureau 39 oversees a vast array of operations, including those of the Korean Workers Party, 61 VOLUME XXIII, NUMBER 1 · FALL 2014

INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE “the military and an even hazier group of entities,” which include government-owned front companies as well as other licit and illicit enterprises.22 Each department has its own specific specialization.23As of 2010, the Bureau controlled a total of seventeen offices abroad, with representation in Moscow, Singapore, and various parts of China.24 The domestic reach of Bureau 39 is no less extensive. According to sources, Bureau 39 has representation at “every major sea port and rail junction in North Korea. Office #39 also maintains liaison offices in every province, city, and county in North Korea.”25 Bureau 39’s largest operating agency, the Daesung General Bureau (DGB), is directly responsible for various trade companies and foreign exchange banks.

Falling under the umbrella of the larger Bureau 39, DGB’s activities are entirely segregated from those of the North Korean state. Instead, the organization reports directly to the Kim family, under the auspices of the KWP’s Organization and Guidance Department.26 Though technically overseen by the government Bureau 39 and its subordinates act as a parallel economy to that of the one officially run by the North Korean government. The many branches of the DGB are responsible for procuring an array of goods for the regime from both domestic and international sources. Some of the sources from which these goods are procured are licit; others are not. 27 Given its broad mandate, the Daesung General Bureau continuously expanded to the point that Bureau 39 is now colloquially referred to as the Daesung Conglomerate.

Bureau 39’s criminal focus is international in scope.28 The office is responsible for managing all of the Korean Worker’s Party’s foreign transactions (both licit and illicit), a mandate which includes overseeing a number of front companies.29 Two well-established examples are Austria’s Daesung Chongguk and the Zokwang Trading Company, based 62 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN in Macao.30 In most cases the front companies answer directly to Bureau 39.31 Bureau 39 is also responsible for managing slush funds for the Korean Workers Party elite.32 According to David Asher of the State Department, “in one sense, Office 39 is like an investment bank. It provides the money for the stuff Kim needs. Like any organized crime syndicate, you’ve got a don, and you’ve got accountants, and it’s a very complicated business, keeping track of all this money and making sure the boss gets paid.”33 These activities have led to Bureau 39 becoming colloquially known as the “keeper of Kim’s cashbox.”34 As of 2010, this so-called cashbox was thought to hold approximately $5 billion in cash.35 In addition to managing front companies and illicit funds, Bureau 39 is responsible for the procurement of certain goods, including luxury goods destined for the North Korean political elites. This was the case in 2009, when a botched attempt at procuring two Italian yachts, worth over $15 million and intended for the personal use of Kim Jong-il, implicated Bureau 39.36 On the illicit end, for example, Bureau 39 coordinates ephedrine imports, a key precursor chemical for the production of methamphetamine.37 The funds generated by Bureau 39 and its subordinates’ activities are used in three ways. First, they are used to support the lavish lifestyle of the Kims, as well as that of other members of the Kims’ inner circle. Second, the funds are used by the Kims to maintain the loyalty of the military and political elite. Third, the funds garnered through illicit activities are funneled back into the DPRK’s military apparatus, most notably to fund the country’s nuclear and ballistic missiles program.38 The types of criminal activities that provide these funds are vast and surprising, and have evolved over the years. The list of North Korea’s nefarious activities includes “illicit drug production and trafficking, foreign currency counterfeiting, trafficking in counterfeit cigarettes and pharmaceuticals, insurance fraud, and trafficking in humans.”39 However, even this list is not extensive.

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INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE Drug Trafficking The North Korean government’s involvement in drug trafficking was first made apparent in the 1970s, and was facilitated in large part by the use of diplomats stationed at foreign posts. In 1976, North Korea’s precarious financial situation led to individual embassies being required to cover their entire cost of operations personally; these diplomats and officials were encouraged by the state itself to engage in illicit smuggling activities using diplomatic protections.40 That year, North Korean diplomats were expelled from Norway, Sweden, Denmark, and Finland for trafficking in black market cigarettes, liquor, and hashish. The Danish Prime Minister at the time, when commenting on the event, stated that the trafficking was not done for personal gain, all-but-confirming the state’s role in these illicit schemes.41 In 1977, all North Korean diplomats were expelled from Venezuela for their involvement in narcotics trafficking three years after the two countries first established diplomatic ties.42 While the use of embassies for illicit trafficking remains an issue, the overarching trend seems to be a shift towards less conspicuous methods of distribution. Increased scrutiny encouraged the North Korean government, in its typical adaptive fashion, to turn to other methods of trafficking, such as the use of state-owned enterprises as front companies. On the distribution end, North Korea seems to have shifted to contracting with criminal partners for the transportation and distribution of illicit narcotics in a given market.43 The benefits of doing so are apparent on both ends.

By partnering with the state, the criminal organization gains a stable supply partner and increases efficiency by circumventing law enforcement. Furthermore, the organization gains access to the enhanced resources of a nation-state.44 From the state’s perspective, North Korea gains plausible deniability through outsourcing while still earning a significant profit. In addition, the state eliminates competition in distribution markets by turning competing groups into partners while maintaining its ability to produce narcotics without the threat of interdiction.45 There have been known drug drops at sea between North Korean Special Operations Forces and the Japanese Yakuza.46 The DPRK has also been linked to Taiwanese organized crime groups (allegedly 64 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN bringing members to North Korea for meetings), as well as the Russian Mafia and other criminal organizations throughout Europe and Southeast Asia.47 Though North Korea has contracted out part of its illicit narcotics distribution, the state still actively involves members of its diplomatic corps, the military, and intelligence service in the process.48 In order to circumvent both international law and the domestic law of other states, North Korea continues to take advantage of the power and resources it possess as a sovereign nation-state. One method by which the DPRK circumvents such laws is to use state-owned commercial vessels and military vessels for the transportation of illicit narcotics.49 The majority of drug transportation to its wholesale market, where it is then sold by various criminal groups, is done through the use of DPRK ocean-going vessels; North Korean vessels have been caught, for example, transferring narcotics to Japanese vessels in DPRK territorial waters.50 North Korean officials also serve as middlemen for other illicit narcotics traffickers, a practice which has been observed on several occasions and has direct implications for regional security.51 When acting as middlemen, DPRK officials generally forego monetary payment and instead barter for other types of goods. On one occasion, a North Korean vessel loaded with small arms was detained by authorities in Myanmar. Insurgent groups within Myanmar had planned to trading heroin for weapons.52 Though it is unclear whether the arms’ final destination was Myanmar, their spread would have would have been a destabilizing factor. Two further cases in 1998 illustrate North Korea’s willingness to act as a middleman. In Egypt, a diplomatic official from the DPRK was captured by Egyptian authorities when trying to transport 500,000 tabs of rohypnol, better known as the ‘date rape’ drug, into the country. That same year, two DPRK diplomatic officials were arrested in Russia with 35 kilograms of cocaine. 53 In the latter two instances, it is unclear whether or not the DPRK produced the drugs domestically, or if they are simply further examples of North Korea acting as a middleman. However, North Korea has not traditionally been known to be a major producer of either rohypnol or cocaine.

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INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE As North Korea began to contract out aspects of its drug trade, its profits took a slight hit, and continued to drop throughout the 2000s.54 This drop in profit could be one of the reasons that North Korea has reportedly shifted away from the drug trade and towards more profitable illicit industries like counterfeiting. While one can only speculate as to the reasoning behind the shift, it is evident that the volume of North Korean narcotics trafficking is on the decline. A public report on drug seizures noted the drop in trafficking along with a rise in North Korean drug seizures which peaked in the mid-1990s and was followed by a continual decrease through the report’s cutoff in 2006.55 A decline in drug seizures is generally correlated with a decrease in drug production, although in the case of North Korea it is difficult to confirm. The DPRK could have been using its extensive state resources more effectively to evade interdiction efforts. Nonetheless, the evidence points to the fact that illicit narcotics trafficking has decreased in the past several years, while still remaining an important source of income for the state. The North Korean government is known to be deeply involved in and committed to the production of both heroin and methamphetamine, illicit drugs which are not intended for domestic consumption but instead sold internationally.

Heroin Heroin production in North Korea began in the late 1970s, although the degree of state involvement was not revealed until the famine in the 1990s, when international aid workers were allowed into the country.56 Various Western intelligence organizations have since corroborated the stories of these aid workers, noting the existence of large, state-run opium 66 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN refinement facilities within the country.57 To this day, the North Korean government holds a monopoly on the heroin trade, responsible for growing, manufacturing, processing, warehousing, and—to an extent— transporting the drug.58 According to the testimony of North Korean defectors, the government uses its citizens to cultivate the poppies, with villages facing strict production targets.59 Once the raw opium is extracted from poppies on these farms, it is then transported to pharmaceutical plants near the Nanam area of Chongjin.60 Because the government is complicit in the criminality, there are no obstacles in terms of domestic refinement and distribution.

Following several publicized incidents of North Korean diplomats being arrested for trafficking, the government diversified its approach to heroin distribution, though the DPRK has not entirely eliminated the diplomatic aspect. For example, a DPRK official carrying 50 pounds of heroin was arrested in 1996 by the Russian authorities.61 Two years later, North Korea’s deputy ambassador to Germany was arrested in the country for possessing heroin, which likely originated from the DPRK. That same year, a consulate employee was arrested in China with 9 kilograms of opium in his possession.62 More recently, though, North Korean naval vessels have played a critical and direct role in the distribution process. In 2002, during a stop and search of one of its own commercial fishing vessels, Taiwanese officials discovered 174 pounds of heroin which had been brought on board by way of gunboat from the DPRK. The following year, Australian police arrested three men after they received a delivery of $50 million of processed heroin already prepared for distribution. The illicit narcotics were transported to this coastal village via a small boat put to sea by a DPRK government-owned vessel, known as Pong Su, which floated in nearby waters.63 Methamphetamine Methamphetamine has recently replaced heroin as the drug du jour for North Korean organized crime. The reasons for this switch are known only to certain members of the North Korean elites, though it is likely that the emergence of Afghanistan as the main global supplier of heroin forced the 67 VOLUME XXIII, NUMBER 1 · FALL 2014

INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE DPRK to revamp its strategy toward illicit narcotics. Today, the North Korean government directs its pharmaceutical companies to focus predominantly on the production of methamphetamine. The bulk of North Korean methamphetamines is destined for Japan, which has a large and rapidly growing market.64 Based on previous incidents, it can be surmised that methamphetamines bound for Japan are typically trafficked via North Korean navy vessels. In 2001, following an incident of back-and-forth shooting, the Japanese Coast Guard sank a North Korean naval vessel. The vessel was under the operation of members of the DPRK Special Forces and had entered Japanese territorial waters with the express goal of transferring DPRK-produced methamphetamine to the Japanese Yakuza.65 North Korean-manufactured methamphetamine is also exported to China, and in some proven cases even further into the West.66 Methamphetamine distribution is, for the most part, conducted in two ways. First, meth bound for Japan, along with many other countries, is exchanged at sea with the DPRK’s criminal partners. Second, meth destined for China is smuggled across the Chinese border. Despite these two predominant forms of trafficking, instances of diplomatic trafficking have also been observed. In 2012, South Korean newspaper Chosun Ilbo reported that the North Korean embassy in an unspecified Eastern European country received a large quantity of illegal narcotics. Diplomats were told to sell the drugs and send the money back to North Korea. The defected DPRK official who supplied these details also told the newspaper that this embassy was not the only one to receive such orders, though overall they appear to have been concentrated largely on embassies located in the meth-addled region of Eastern Europe.67 The former official stated that various DPRK diplomatic officials stationed abroad had received 20 kilogram parcels sent directly from North Korea, along with instructions to send cash back by a specific deadline: April 15, or Kim Jong-un’s birthday.68

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CHRISTINA GATHMAN Counterfeit Currency and Goods ‘Superbills’ In addition to its use of drug-trafficking to make money, North Korea is the world’s largest producer of what are known as ‘superbills,’ or counterfeit U.S. one hundred dollar bills.69 These bills first began circulating in 1989 and were detected in Manila and Belgrade that same year.70 It is estimated that millions of dollars of superbills were already in distribution by this time.71 As of 2000, the United States government possessed information which confirmed the presence of various printing plants located within North Korea being used to create these superbills.72 These bills are extremely inconspicuous and are considered to be among the most sophisticated counterfeits in the world.73 The case of Chen Chaing Liu speaks to this accuracy. In March of 2009, Liu, a Taiwanese national residing in Las Vegas, was sentenced to over twelve years in prison for conspiracy and fraud as it related to his role in laundering millions of dollars of presumed North Korean superbills.74 Because of their exceptional quality, Liu was able to use slot machines in Las Vegas casinos, all of which are required to have special electronic devices to detect counterfeit currency, to launder massive amounts of counterfeit superbills. The majority of Liu’s bills passed through the machines undetected, eventually finding their way out of the casinos and into general circulation.75 In addition to Las Vegas, superbills have turned up in locations as diverse as Lebanon’s Bekaa Valley, Ethiopia, Peru, Germany, Hong Kong, and Macao.76 The currency production process is carried out by highly trained professionals using advanced machinery from Japan, paper from Hong Kong, and ink from France. The alleged distribution network for superbills 69 VOLUME XXIII, NUMBER 1 · FALL 2014

INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE implicates a variety of actors, including North Korean diplomats, Chinese gangsters, organized crime syndicates (both in Asia and elsewhere), and banks (in the past, primarily in Macao).77 In Europe, the North Korean government has cultivated ties with the Official Irish Republican Army, an I.R.A. splinter group, who has been utilized in the laundering of superbills.78 The total proceeds from this distribution ring with the Official Irish Republican Army were estimated at $28 million.79 It is speculated that North Korea earns around 40 percent of the face value of these bills.80 In certain cases, Chinese merchants have purchased superbills for up to 50 percent of their face value.81 China, for its part, has voiced concern regarding the production of superbills to North Korean officials, specifically to the DPRK’s Vice Foreign Minister, Kim Kye-kwan, during his delegation’s visit to Beijing. Furthermore, in 2006 China’s central bank, the People’s Bank of China, issued a public announcement urging all Chinese financial institutions to ‘increase vigilance’ against the counterfeit currency.82 Some of the manufactured superbills allegedly remain in North Korea and are subsequently used by DPRK intelligence sources to finance overseas activities or to procure goods for Kim, as well as to directly finance WMD transactions.83 Part of the 2005 actions in Macao, to be discussed further, included attempts to inhibit the DPRK’s laundering of superbills. In spite of these efforts, the South Korean government has disclosed that counterfeit U.S. currency has flooded into the country in increasing numbers since 2005.84 Cigarettes

An even more recent counterfeiting industry to arise in North Korea, picking up at the beginning of the Kim Jong-il regime, is counterfeit cigarettes, an industry at which the DPRK government is rather proficient.85 Central estimates of North Korea’s profits from counterfeit cigarette production are $100 million per year. Depending upon the price variation of different markets, profits can range from $80 to $160 million.86 It has been speculated that counterfeit cigarettes very likely constitute North Korea’s most profitable container export. 87 Cigarette 70 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN production factories are located throughout the state, rather than being centralized in one area. It is reported that North Koreans who work in these factories are considered members of a ‘special work force team,’ and are given preferential treatment over average North Korean citizens, including extra food rations.88 The cigarettes produced are generally replicas of American, Japanese, and British tobacco brands, with at least one of the factories solely producing counterfeit Marlboro cigarettes.89 Given the available evidence, it seems that while North Korean illicit narcotic sales are declining, they are being replaced with counterfeit cigarette sales, which appear to be increasing.90 A likely reason for this expansion of counterfeit cigarette production in North Korea is the fact that counterfeit cigarettes are both highly profitable and easily exportable.

Counterfeit cigarettes have a low overhead but high profit margin, depending in which country they are sold; in certain cases, a container of counterfeit cigarettes can be sold for 40 to 50 times the cost of production.91 In addition, cigarettes can easily be trafficked through legal means if they avoid detection as counterfeits.

The means through which these cigarettes are trafficked varies. In 2009, Swedish police seized 230,000 counterfeit cigarettes smuggled into the country from Russia. The cigarettes were discovered in a vehicle manned by two North Koreans, both of whom were registered diplomats in Russia, though not in Sweden. In another incident, a vehicle full of North Korean diplomats, who were posted in Warsaw, was stopped at the Jagodzinie checkpoint on the Polish-Ukranian border with 20,000 boxes of North Korean-manufactured counterfeit cigarettes.92 There is also evidence of North Korea’s collaboration with various organized criminal groups, such as Chinese organized crime networks, similar to the distribution networks for illicit narcotics. Japanese intelligence acknowledges that the DPRK transfers counterfeit cigarettes to various foreign vessels, including those 71 VOLUME XXIII, NUMBER 1 · FALL 2014

INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE sailing with Cambodian, Mongolian, and Taiwanese flags, on a regular basis.93 Additional evidence points to counterfeit cigarette trafficking carried out through North Korea’s Rajin-Sonbong Economic Special Zone, now known as the Rason Special Economic Zone. Tung Yan Yuk, a Chinese cigarette smuggler currently wanted for arrest in China, had established links with a factory located inside this free-trade zone, through which he was channeling North Korean-made counterfeit cigarettes into international markets.94 Russian companies, along with several Chinese companies, have established offices in the Rason Special Economic Zone.

While the role of these companies in relation to counterfeit cigarette trafficking is unclear, given the locations in which North Korean counterfeit cigarettes have surfaced, it is likely that at least a few of these businesses are actively smuggling cigarettes out of the DPRK. Other While superbills and cigarettes are North Korea’s two major counterfeiting industries, the government has undertaken other counterfeiting ventures worth noting, prescription medications and insurance. Counterfeit prescription pharmaceuticals have recently been exposed as a major North Korean illicit industry, though the full extent of the industry remains murky. In 2004 Turkish police arrested two DPRK diplomatic officials who were stationed in Bulgaria for attempting to smuggle 700,000 fenethylline pills from Bulgaria to two unidentified Turkish citizens in Istanbul.95 The narcotics were carried in vehicles with diplomatic plates, in yet another attempt by the country to use the diplomatic protections it possesses as a nation-state for its own illicit ends.96 In what may be its strangest undertaking yet, North Korea has also been implicated in the production of counterfeit Viagra.97 North Korea has also most recently moved into the field of insurance fraud. From August 2008 to August 2009, the DPRK’s life insurance corporation recouped around $100 million from European companies, claiming it made payouts on life insurance policies of individuals killed in separate train, ferry, and helicopter crashes. Sources claimed these policies were fraudulent. When the policies are contested as fake, it is difficult to 72 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN meet the standard of satisfaction that courts require in order to overturn the ruling, and the measures are therefore usually unsuccessful.98 A 2009 story published in the Washington Post discusses this scheme in great detail, concluding that the North Korean insurance schemes are extremely sophisticated and extremely profitable, though it is difficult to know their full extent as there are various legal issues to consider, along with the more obvious fact that insurance firms are hesitant to draw attention to their losses and thus disclose little information about the phenomenon.99 Violence and Corruption With regard to violence, the DPRK behaves in a manner comparable to that of a conventional non-state mafia, employing both fear and violence to ensure proper behavior from its members. This can be observed in the case of Chen Chiang Liu; when asked why he chose not to secure a deal with the prosecutors in his case, Liu replied, “the North Koreans are my friends. I have a good connection with them. I can make money easily with them. But you can’t betray them.”100 Members of the North Korean criminal nexus who do not deliver on their responsibilities are eliminated.101 Corruption in the North Korean organized criminal activities is more difficult to discern. Corrupt military officials and border guards are crucial components in the process of transferring North Korean migrants across the border to China. However, the case of state-sanctioned crime in North Korea is more opaque. In a state where an integral part of the government’s mandate is to engage in illicit activities, can these activities still be considered corrupt? With the North Korean government, there is no discernible norm, whether explicit or implicit, from which the state deviates. In the case of DPRK-sanctioned organized crime, it may be argued that what occurs is not corruption but instead a government that functions how it is supposed to, though with a vastly different modus operandi than what is considered the norm in international relations.

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INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE Threats to State, Individual, and Regional Security Because of the top-down pervasiveness of organized crime in North Korea, the country’s illicit activities do not present a threat to state-level security. While a case could be made that the government’s focus on criminal activity detracts from its ability to provide state services to its population, this lack of proper governance stems more from selfish, authoritarian leadership, and not from the criminal activity itself.

However, the threats to both individual and regional security stemming from North Korean organized crime are significant.

At the individual level, the biggest threat stems from the government’s involvement in illicit narcotics trafficking. As previously mentioned, during the famine of the 1990s the North Korean government slightly liberalized parts of the north, specifically North Hamgyung province, allowing for a small measure of black market trade, with the hope of bringing in foodstuffs across the border from China for the starving population. Upon the enactment of these measures, Chinese rice began making its way across the border along with black market Chinese goods such as DVDs.102 Around this same time, North Korea began producing methamphetamine in large, state-run factories. Meth produced in these factories was subsequently smuggled into and sold in China through these same black market cross-border channels, channels which the government had not closed, due to either lack of will or lack of ability. Eventually, some of the methamphetamine smuggled into China began to find its way back into North Korea through this cross-border trade.103 Today, North Korea’s northernmost provinces have allegedly been blighted with a large amount of recreational meth use and subsequent meth addiction. While one must be critical of allegations given the closed-off nature of North Korean society, a report published by the Brookings Institution in 2010 did lend credence to the idea that rates of methamphetamine addiction in the country are “significant and growing.”104 Considering North Korea’s starving population (meth allegedly helps dull hunger pangs), lack of proper health education, virtually non-existent healthcare system in large parts of the country, and the possible flow of meth back across the Chinese border, it is unlikely that this problem will dissipate in the near future.

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CHRISTINA GATHMAN The threats to regional security are evident, demonstrated by several international cases in the Asia-Pacific. In February 2013, The Economist reported that China has been facing an ongoing struggle against methamphetamine smugglers who cross the border under the guise of DPRK defectors.105 It is claimed that around 40 to 67 percent of Japan’s methamphetamine originates in the DPRK. Further across the Pacific, in Hawaii, the growing rate of methamphetamine addiction has been attributed to North Korean meth, which has made its way into the territories through criminal groups connected to the DPRK.106 Additionally, Myanmar presents a regional security threat. As mentioned earlier in the paper, a North Korean ship carrying small arms was detained in Myanmar in 2003. These weapons were being traded for heroin, which was manufactured and sold by members of the guerilla faction. In acting as a middleman for the Myanmar guerillas and supplying them with small arms, North Korean organized crime contributed to the prolonged violence in the country.107 While this ‘guns for drugs’ scheme was interrupted, there is nothing to prevent North Korea from enacting this scheme in other countries, such as Afghanistan, and causing further destabilization.

Efforts to Combat North Korea’s Illicit Activity North Korea’s status as a sovereign nation-state complicates external efforts to combat its organized criminal activities. However, the United States has taken reasonably effective steps toward interdicting North Korea’s illicit funds. Pressure from the United States on banks in Macao, where North Korean illicit funds were traditionally held, led to North Korea transferring funds to other countries.108 Before they could transfer the funds, however, the U.S. Treasury Department froze $25 million of North Korean assets being held in Macao’s Banco Delta Asia.109 New controls issued by the Chinese authorities have led to more stringent requirements for customers opening accounts at Banco Delta Asia.110 Between 2005 and 2007, the U.S. Treasury Department cracked down on several North Korean front companies, in addition to the complicit banks, which caused notable damage to North Korea’s illicit economic networks and inhibited its criminal capabilities, while causing other banks to deny 75 VOLUME XXIII, NUMBER 1 · FALL 2014

INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE North Korean funds for fear of increased U.S. scrutiny.111 In the end, however, it seems that this crackdown has only encouraged the DPRK to seek out other methods of money laundering. This has even involved the DPRK reverting back to its triedand-true method of using the diplomatic privileges of a nation state to conduct its criminal activities, illuminated in early 2006 when diplomatic officials attempted to smuggle large amounts of American and Japanese currency into Mongolia.112 Conclusion and Future Implications Throughout the years, noticeable developments have occurred in the North Korean state-organized crime matrix. As the state’s criminal activities became more apparent, the use of middlemen, front companies, and multiple names became common practice. This gave North Korea a unique advantage, enabling the government to insulate and disguise its illicit activities more effectively than in the past.113 In November 2010, the U.S. Treasury Department designated Korea Daesong Bank and Korea Daesong General Trading Corporation as either belonging to, or controlled by, Bureau 39 of the Korean Workers Party.114 According to a press release from the U.S. Department of the Treasury issued on November 18, 2010, “Korea Daesong Bank is involved in facilitating North Korea's illicit financing projects, and Korea Daesong General Trading Corporation is used to facilitate foreign transactions on behalf of Office 39.”115 This followed the increased U.S. government scrutiny of 2005, which led to several of North Korea’s secret accounts being transferred to banks in Luxembourg and Singapore.116 This maneuverability also translates to other aspects of North Korea’s criminality, as the state is able to deftly switch from one criminal activity to another, doing so when any given operation becomes too noticeable. North Korea’s latest move towards increased production of counterfeit cigarettes and insurance fraud activity 76 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN can be partially attributed to its illicit narcotics trafficking and counterfeit currency operations becoming too well-known.117 The North Korean government has proven that its criminal networks are extensive, as well as “adaptive, resilient, covert, and widespread.”118 Its schemes are highly adaptable and creative. These facts have several implications for the future of North Korean organized crime. The most important consequence is that North Korean criminal activities are likely to continue in the future, adapting and evolving in the face of any outside pressure on the state. Though Kim Jong-un’s role related to Bureau 39 remains unclear, there is evidence that he remains well connected to the office. Just prior to the death of Kim Jong-il, his son can be spotted in the background of a photograph of the Dear Leader, who is on an escalator at a supermarket. Standing next to Kim Jong-un in the photo is the manager of Bureau 39, Jon Il-Chun.119 Combined with the lavish lifestyle that the youngest is alleged to Kim live, it is likely that the predicted negative effects on Bureau 39 following the death of its head Kim Jong-il and the subsequent transfer of leadership have failed to materialize.120 The biggest concern regarding the future of North Korean organized crime is the possibility of the DPRK adding a nuclear export component to its pre-existing illicit smuggling networks. Thus far, networks used for proliferation purposes have been concentrated almost entirely on imports rather than exports, as the DPRK seeks to strengthen its nuclear capabilities.121 However, if and when North Korea is able to build up its nuclear program to a suitable extent, this could change. The DPRK has not consistently rejected the option of nuclear export, and the state possesses a track record of disregard for international laws and norms.122 For example, U.S. and Israeli intelligence reports have linked the DPRK to the construction of a nuclear reactor in Syria, although the reactor was ultimately eliminated in 2007 by an Israeli airstrike.123 Given the current state of North Korea’s nuclear program, however, the plausibility of illicit nuclear exports remains unlikely. The biggest hindrance on North Korean nuclear exports is the country’s uranium enrichment program, which, as far as Western sources understand, is not yet advanced enough to appeal to 77 VOLUME XXIII, NUMBER 1 · FALL 2014

INSIDE NORTH KOREA’S STATE-SANCTIONED CRIMINAL EMPIRE potential buyers.124 Given the fact that North Korea is actively engaged in nuclear import via its illicit smuggling networks, this could change.

North Korea continues to face international sanctions related to its nuclear program, leaving the country desperate for income in the form of hard currency, thereby re-emphasizing the role and importance of Bureau 39 to the state. In short, Bureau 39 has become an integral part of North Korean politics as a result of the financial struggles faced by the state. As long as Bureau 39 benefits the elites ruling the reclusive country, the leadership will not inhibit its activities or shutter its operations. Any further increases in sanctions against North Korea will serve to drive the government further into the realms of criminality. Increasing the DPRK’s inability to procure financing on the licit international market will force the state to rely more heavily on those areas in which it can procure finances, i.e. the illicit criminal markets. The DPRK will not accept further international sanctions without taking actions to support its own survival. It will instead do everything in its ability to minimize fallout from further sanctions.

North Korea’s adaptability and ability to easily switch to new lines of illicit businesses will render international measures to combat DPRK organized crime minimally effective.

The existence of a criminal state such as the Democratic People’s Republic of North Korea has far-reaching security implications.

Domestically, criminal activity allows the government to maintain its hold on power and its extreme levels of repression over the population without any accountability or regard for human rights. As seen in the case of staterun methamphetamine factories, certain illicit activities trickle back into society with negative repercussions, in this case creating a domestic public health issue. Regionally and internationally, North Korean criminal activities can and have served as destabilizing factors. Whether contributing to rising drug addiction rates in various countries, or trafficking weapons and providing weapons technology to rogue states, guerilla insurgencies, or terrorist organizations, North Korea has proven that it is a state willing to conduct its criminal business with just about anyone, anywhere. Unfortunately, without a drastic shift in North Korean governance, there looks to be little hope for a decrease in the state’s 78 INTERNATIONAL AFFAIRS REVIEW

CHRISTINA GATHMAN criminality. There will always be a bank somewhere willing to assist in the laundering of illicit funds, and as long as there remains a demand for illicit goods and services, there seems to be little to no regulating mechanism when it comes to North Korea’s involvement in organized crime.

Endnotes 1

Members of the diplomatic service, the state security service, organs of public administration, the public manufacturing and agricultural sectors, state owned enterprises, and unique state organs have all directly taken part in criminality. For more on this, see Michael Miklaucic and Moises Naim, “The Criminal State,” in Michael Miklaucic and Jacqueline Brewer eds., Convergence: Illicit Networks In the Age of Globalization, (Washington, D.C.: NDU Center for Complex Operations, 2013), 149-69 at 164.

2 Miklaucic and Naim, 164.

3 David Rose, “North Korea’s Dollar Store,” Vanity Fair, August 5, 2009, http://www.vanityfair.com/politics/features/2009/09/office-39-200909 See also Miklaucic and Naim, 165.

4 Sheena Chestnut, “Illicit Activity and Proliferation: North Korean Smuggling Networks,” International Security, no. 32, 1 (Summer 2007): 80-111 at 92. http://scholar.harvard.edu/files/greitens/files/Chestnut%20-%20Illicit%20Activity% 20and%20Proliferation%20-%20North%20Korean%20Smuggling%20Networks.pdf 5 Miklaucic and Naim, 150.

6 Ibid.

7 Bureau 39 is more formally known as Central Committee Bureau 39, but is often referred to as Office 39 or Room 39.

8 Vasily Mikheev, “Reforms of the North Korean Economy: Requirements, Plans and Hopes,” The Korean Journal of Defense Analysis no. 5, 1 (Summer 1993): 81-95 and 248-249. See also Paul Rexton Kan, Bruce E. Bechtol Jr., and Robert M. Collins, “Criminal Sovereignty: Understanding North Korea’s Illicit International Activities,” Strategic Studies Institute, March 2010, 4, 21, http://www.strategicstudiesinstitute. army.mil/pdffiles/pub975.pdf 9 Mikheev, 248.

10 Kan et al., 2.

11 Sheena Chestnut Greitens, “A North Korean Corleone,” New York Times, March 3, 2012, http://www.nytimes.com/2012/03/04/opinion/sunday/a-north-korean-corleone.html 12 Kan et al., 4-5.

13 Miklaucic and Naim, 165.

14 Geoffrey Ingersoll and Adam Taylor, “North Korea Allegedly Forces Diplomats to Deal Drugs for Hard Cash,” Business Insider, March 22, 2013, http://www.businessinsider.com/north-korea-allegedly-turns-foreign-diplomats-into-bigtime-drug-dealers-2013-3 15 Rose.

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16

Kan et al., 1.

Tamara Makarenko, “The Crime-Terror Continuum: Tracing the Interplay between Transnational Organized Crime and Terrorism,” Global Crime no. 6, 1 (February 2004): 129-45 at 139, http://dx.doi.org/10.1080/1744057042000297025 18 Kan et al., 1 and 21.

19 Kan et al., 21.

20 Ibid.

21 Rose.

22 Kan et al., 6 and 22. See also Rose.

23 Kan et al., 22.

24 Ibid., 24.

25 Ibid.

26 Ibid., 25.

27 Ibid.

28 Ibid., 2.

29 Ibid., 5.

30 Ibid.

31 Ibid.

32 U.S. Department of the Treasury, “Treasury Designates Key Nodes of the Illicit Financing Network of North Korea’s Office 39,” Press Release, November 18, 2010, http://www.treasury.gov/press-center/press-releases/Pages/tg962.aspx 33 David Asher, in Rose.

34 Kan et al., 4.

35 Ibid., 7.

36 Jeremy Page, “Luxuries Flow Into North Korea,” Wall Street Journal, January 7, 2012, http://online.wsj.com/articles/SB10001424052970204331304577142372171328622 37 Rose.

38 Kan et al., 3.

39 Miklaucic and Naim, 164.

40 Chestnut, 85-6.

41 Miklaucic and Naim, 164.

42 Kan et al., 10.

43 Julia Sieger, “Illicit Activity and Proliferation: North Korean Smuggling Networks Review,” Human Security Journal, no. 6 (Spring 2008): 136-138 at 136.

44 Kan et al., 11.

45 Ibid.

46 Ibid.

47 Kan et al., 11-2.

48 Frank Cilluffo, “The Threat Posed from the Convergence of Organized Crime, Drug Trafficking, and Terrorism,” testimony before the U.S. House Committee on the Judiciary, December 13, 2000, http://csis.org/files/media/csis/congress/ ts001213cilluffo.pdf 17

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49

Kan et al., 9.

Ibid.

51 Ibid., 10.

52 Ibid.

53 Ibid., 11.

54 Greitens. See also Stephen Haggard and Marcus Noland, “North Korea’s External Economic Relations,” Peterson Institute for International Economics, August 2007, 8, http://www.iie.com/publications/wp/wp07-7.pdf 55 Haggard and Nolan, 8.

56 Kan et al., 8-9.

57 Cilluffo.

58 Kan et al., 8.

59 Ibid.

60 Ibid., 9.

61 Ibid., 10.

62 Ibid., 11.

63 Ibid., 10.

64 Mischa Glenny, McMafia (New York: Vintage Books, 2008), 338.

65 Kan et al., 10.

66 Martin Robbins, “The Weird Science of North Korea,” Vice, June 2013, http://www.vice.com/read/north-korean-scientists-are-leaving-the-west-behind 67 Ingersoll and Taylor.

68 Ibid.

69 Superbills are also known as supernotes.

70 See Haggard and Nolan, 8. See also Kan et al., 13.

71 Kan et al., 13.

72 Cilluffo.

73 Glenny, 338. See also Kan et al., 12.

74 Rose.

75 Ibid.

76 Kan et al., 13.

77 Ibid.

78 Greitens.

79 Kan et al., 18.

80 Haggard and Nolan, 9.

81 Kan et al., 13.

82 Ibid.

83 Ibid., 13-14.

84 Ibid., 12-13.

85 Ibid., 15.

86 Haggard and Nolan, 10.

87 Kan et al., 15.

50

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88

Ibid.

Ibid., 15-16.

90 Haggard and Nolan, 10.

91 Kan et al., 14-15.

92 Yuliya G. Zabyelina, “The Untouchables: Transnational Organized Crime Behind Diplomatic Privileges and Immunities,” Trends in Organized Crime 16 (January 2013): 343-367 at 354, dx.doi.org/10.1007/s12117-012-9184-y 93 Kan et al., 16.

94 Glenny, 337-8.

95 A synthetic drug known as Captagon, which is now illegal in most countries. See Zabyelina, 354.

96 Ibid.

97 Blaine Harden, “Global Insurance Fraud by North Korea Outlined,” Washington Post.

June 18, 2009, http://www.washingtonpost.com/wp-dyn/content/article/2009/06/17/ AR2009061703852.html 98 Rose.

99 Harden.

100 Rose.

101 Ibid.

102 Max Fisher, “How North Korea got Itself Hooked on Meth,” Washington Post, August 21, 2013, http://www.washingtonpost.com/blogs/worldviews/wp/2013/08/21/how-northkorea-got-itself-hooked-on-meth/ 103 Ibid.

104 Ibid.

105 Ingersoll and Taylor.

106 Kan et al., 19.

107 Ibid., 18. See also Shawn Crispin and Bertil Lintner, “For U.S., New North Korea Problem,” Wall Street Journal, November 18, 2003, http://online.wsj.com/articles/ SB106910943187620600 108 In the past Macao was a hub for North Korean criminal activity, specifically money laundering, due in large part to the island’s lax banking laws.

109 Kan et al., 7.

110 Ibid., 12.

111 Ibid., 26.

112 Ibid., 12.

113 Chestnut, 98.

114 U.S. Department of the Treasury.

115 U.S. Department of the Treasury.

116 Kan et al., 7.

117 Greitens.

118 Kan et al., 19.

119 Greitens.

89

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120

Mark Blunden, “North Korean Dictator Kim Jong-un’s ‘Seven Star’ Lifestyle of Yachts, Booze, and Lavish Food,” London Evening Standard, October 17, 2013, http://www.standard.co.uk/news/world/north-korean-dictator-kim-jonguns-sevenstarlifestyle-of-yachts-booze-and-lavish-food-8885910.html.

121 Chestnut, 97.

122 Miklaucic and Naim, 165. See also Sieger, 137.

123 Greitens.

124 Greitens.

83 VOLUME XXIII, NUMBER 1 · FALL 2014

IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME

Improving U.S. Strategy on Transnational Organized Crime John Driscoll John Driscoll is a graduate student at the Elliott School of International Affairs, The George Washington University. He is pursuing his Master of Arts in International Affairs, with a dual focus in international security issues and conflict resolution. His has a B.A from Elon University, where he double majored in political science and international studies.

Abstract In recent decades transnational organized crime (TOC) has risen swiftly up the U.S. security agenda, and the scale and scope of potential profits for criminal groups has expanded as a result of improved information and transportation technologies.

Domestically, no organized crime threat poses as great a risk as the illicit trafficking of drugs, for which the United States is a top consumer. In the face of these challenges, the U.S. government has developed a National Strategy to Combat TOC, and continued its decades long War on Drugs. Both the broad strategy against organized crime, and specific national drug policies, are deeply flawed and in need of serious revision. For effective progress towards combatting TOC and drug trafficking, the United States will primarily need to shift focus from supply management towards demand reduction policies, develop proper metrics for effectiveness, and increase international and multilateral efforts.

Developing a successful strategy to combat transnational organized crime (TOC) presents a highly complex challenge. This stems from the fact that, as Edwards and Gill point out, TOC blurs the “established boundaries between domestic security, which is the appropriate jurisdiction of criminal law, and protection from external threats which is the appropriate responsibility of foreign and defense policy.�1 There is no clear solution to deal with criminal activity that takes place only in part on domestic soil.2 84 INTERNATIONAL AFFAIRS REVIEW

JOHN DRISCOLL What is clear is that the current strategy used by the United States is far from perfect, as the scale, scope, and potential profits of organized criminal activity have risen dramatically in recent decades.3 In light of these developments, this paper is focused on answering the following questions: what is the current strategy of the United States on TOC, how does this strategy manifest itself in U.S. drug policy, and how could it be improved in terms of performance and effectiveness?

The concept of organized crime lacks a precise and universal definition, and can at times be very encompassing and ambiguous. The unlawful production, trafficking, and sale of arms, drugs, humans, oil, antiquities, wildlife, and counterfeit goods and medicines can all be reasonably included in a definition of international organized crime, along with international tax fraud, predatory extortion rackets, gambling, and many other illicit activities. Of all these, none has a more significant effect on the United States in terms of scale and negative impact than drug trafficking. Therefore, in conjunction with a macro study on U.S. TOC goals and strategy, the central focus of this paper will be the specific implications of this strategy on U.S. drug policy. Concentrating on drug trafficking provides a manageable scope for analysis, and brings attention to the sector of organized crime that is most important to U.S. political and security agenda.

This paper starts with an explanation of the relevance of the threats posed

by TOC and the causes of its rising priority in the security agenda. From there, an illustration of the current U.S. strategy to combat organized crime and drug trafficking will be presented. An evaluation of the current strategy follows, in which its major failings will be made clear. Moving forward, this paper presents alternative strategy options that this author will argue are better fit to handle TOC in general and drug trafficking specifically. These alternatives include shifting focus from supply management towards demand reduction, developing proper metrics for effectiveness, and increasing international multilateral efforts to combat TOC, for which specific potential difficulties will be discussed. Finally, I will present conclusions about the current and future state of U.S. TOC strategy.

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IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME Threats and Causes of TOC In recent decades the scale and scope of TOC, measured as a component of the global economy, has risen dramatically.4 Rough estimates conclude that it represents over 3% of the world’s total gross domestic product (GDP).5 Organized criminal activity has a direct and adverse effect on public health, levels of violence, criminality and corruption, and even interstate relations.6 For the United States this issue is particularly acute, as the Western Hemisphere holds some of the world’s largest producer and consumer nations of illicit drugs.7 While TOC poses more of a strategic than existential threat to the relatively strong and stable United States, the same cannot be said for other countries in the region. In the most severe instances, “by setting off disintegrative cycles,” organized crime and drug trafficking have threatened the very sovereignty of comparatively weak states in a “particularly rapid and dramatic fashion.”8 In such cases TOC can and does undermine a states’ ability to provide citizens with basic services, as well as fuel violent conflict within the state.9 The worldwide attention garnered by TOC is a relatively recent phenomenon.10 A variety of arguments exist for the rising priority of organized crime in the security agenda. Traditional realists have argued for the decline of large-scale interstate conflict as a primary cause. One prominent argument contends that the end of the Cold War has resulted in the vast array of U.S. security and defense agencies adopting new challenges, such as transnational organized crime, to serve as continued justification for their existence and large budgets. Others have focused on the effects of globalization and its corresponding technological improvements. Liberalization and partial deregulation of international trade and finance, advancements in communication, information, and transportation technologies, and increases in cross-border transactions in general have created new opportunities for criminals and 86 INTERNATIONAL AFFAIRS REVIEW

JOHN DRISCOLL made states more susceptible to organized crime.11 Among these factors, the increasing importance of international trade is particularly prominent.

In practice, there is no “strict dichotomy between the ‘upperworld’ of legitimate economic enterprise and the ‘underworld’” of illicit cross border trade; they are in fact deeply intertwined.12 Put together, these factors can help explain both the rising priority of TOC on the security agenda, and the abundance of criminal opportunities for these organizations. The overall impact of these developments has resulted in significant changes in the specific commodities trafficked, the pace, scale, and method of cross-border transport, the organizational characteristics of criminal operations, and the level of consumer demand.13 Current U.S. Strategy to Combat TOC The “U.S. Strategy to Combat TOC” published by the White House in 2011 contains five tenets, stated in this order: protecting US citizens from harm and violence, increasing government transparency worldwide, protecting U.S. strategic economic markets, defeating TOC networks, and lastly, building multilateral cooperation.14 Quite recently, the U.S. Senate Subcommittee on Crime and Terrorism has added to its “cutting edge strategy” the goal of bringing “all of the resources and tools of the Federal Government to bear in a coordinated way against transnational criminal groups.”15 The goals of this strategy are fairly straightforward: to limit consumption of these illicit goods, to reduce the harm caused by them in areas such as public health and violence, and to incapacitate organized criminal groups.16 The exact means by which these goals will be achieved is unstated. Upon analyzing the actions of the U.S. government towards these ends, on which greater detail will be provided below, it becomes clear that the prevailing theory within the U.S. policy arena is that TOC must be challenged by criminal law enforcement and, when necessary, military means.17 Furthermore, despite the stated fifth tenant of increasing multilateral cooperation, regional and bilateral TOC initiatives are generally weak.18

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IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME Failings of the Current Strategy There are three major failings in this current strategy to combat TOC: first, it emphasizes criminal law enforcement and military efforts at the expense of social and health programs to curb demand. Second, it is largely federal and unilateral at the expense of multilateral efforts. Lastly, it lacks welldeveloped performance metrics.

The focus on military and law enforcement efforts has been the status quo since the origins of the struggle to combat organized crime. When the international strategy on TOC was developed in the 1960’s, powerful nations that were major importers of illicit goods, mainly the United States, lobbied heavily for a control regime focused on combatting supply, instead of limiting their demand through domestic health-based policies.19 In the following decades, this original perspective became so entrenched that shifting international norms to focus on market-based strategies is extremely difficult.20 Over time this law enforcement strategy has proven to be insufficient to control transnational crime. Although it is effective enough to make the sale and purchase of illicit goods and services a risky and expensive enterprise, it has been incapable of choking-off TOC flows altogether.21 This one-sided focus is detrimental: by fighting supply without allocating equal effort to limiting demand, traffickers are further incentivized to provide drugs to users who are willing to go to great lengths, and pay higher prices, to acquire these illicit goods.22 Even law enforcement initiatives that U.S. political officials have deemed successful treat symptoms of TOC rather than its causes, leading to a quick resurgence of threats. For example, the “Plan Colombia,” an $8.5 billion U.S. program to enhance the law enforcement capacity of Colombia to fight its criminal networks, merely resulted in displacing the criminal organizations to neighboring Peru, according to the United Nations Office on Drugs and Crime (UNODC).23 The military aspect of U.S. strategy is equally flawed, if not overtly detrimental. Along with escalating the violence involved in illicit transactions, the track record of military based antinarcotic policies have demonstrated only the ability to “throw up mirages of success,” and 88 INTERNATIONAL AFFAIRS REVIEW

JOHN DRISCOLL may potentially elicit unintended negative consequences, or “what the parlance terms disruptive feedback.”24 The unilateral focus of the U.S. strategy represents another major problem.

It is fundamentally incorrect to think that any single state can productively combat TOC, regardless of its strength and resources. Moreover, it is often impossible to identify, capture, and prosecute international offenders without the active assistance of foreign governments.25 This is especially hard to accomplish in a context of lacking multilateral legislation and cooperation, as national laws vary greatly on the treatment of organized criminal groups and drug traffickers specifically. U.S. participation in international initiatives to combat TOC is but a minor aspect of its overall strategy. As Berdal and Serrano state: “Even in the most dense, balanced, and farthest-reaching scheme of law-enforcement cooperation,” information and intelligence sharing remains very limited and is based solely on voluntary action, “with the definition of strategies…remaining a mostly national prerogative.”26 Sensitive issues of sovereignty, state monopoly of the use force domestically, and legal jurisdiction perpetually complicate such cooperation.

All of this is underpinned by an unsound system of measurement of progress in the U.S. strategy against transnational crime. Effectively combatting the threats posed by TOC requires a distinction between ultimate and intermediate goals. Currently, policy-makers are concerned with obtaining measures of activity, such as seizures and arrests.27 These metrics focus entirely on intermediate outcomes, and in no way measure progress towards more long-term goals such as limiting violence, corruption, or improving public health. Concentrating on these statistics can be detrimental to the overall strategy, as they demonstrate the alleged effectiveness of programs that may not, in the end, support the real desired outcomes. Reaching intermediate objectives, such as arrests and seizures of criminal assets, is only truly helpful if they produce real incapacitation or general deterrence of criminal networks.28 When put into practice, it becomes clear that this strategy is misguided and ineffective. More than fifty years after combatting transnational drug 89 VOLUME XXIII, NUMBER 1 · FALL 2014

IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME trafficking became a priority, the United States remains the world’s top consumer of illicit drugs and continues to incarcerate citizens at levels high above any other country. Currently, more than half a million U.S. citizens are incarcerated on drug charges. Furthermore, the United States continues to suffer from public health issues related to TOC, with over one third of all AIDS patients in the country having contracted the disease through drug use.29 American demand of cocaine reaches 196 tons per year, a market valued at almost $40 billion.30 In Mexico, a country that receives high levels of U.S. assistance on organized crime issues, between 50,000 and 70,000 people have been killed in TOC related incidents since 2006.31 Strategy Alternatives The current U.S. strategy on combatting TOC can be improved. However, to generate greater progress towards reducing consumption of illicit drugs, improving public health, reducing violence, and defeating organized criminal groups, the focus of this strategy must shift. Initiatives for supply limitation must be met with corresponding social programs that aim for demand reduction. The focus on federal and unilateral initiatives must change towards international and multilateral initiatives that are befitting to the nature of TOC threats. Lastly, proper mechanisms must be designed to measure progress towards ultimate goals, not intermediate activity.

Demand Reduction: In light of the long entrenched views of TOC requiring criminal law and military responses, a new strategy would necessitate what Edwards and Gills call “alternative conceptions” of international security and organized crime, which focus primarily on “the underlying conditions that produce crime in the first place.”32 This means understanding the provision and purchase of illegal goods as a market 90 INTERNATIONAL AFFAIRS REVIEW

JOHN DRISCOLL enterprise, not merely an external security threat. These criminal groups do not participate in such activities by chance, “the demand side of the criminal market is responsible for the existence and spread of transnational organized crime.”33 So long as the incentives for participating in international crime remain high, success against one organization, or in one region, will simply create a scramble by other groups to control the newly available market share.34 In practice, while criminal law enforcement and military efforts have contributed to partial victories and the fragmentation of criminal organizations, this process has not translated into less illegal activity or violence, and has in certain places, like Mexico, directly increased violence.35 This new conception of organized criminal activity will require a different understanding of the way that individual markets and criminal groups interact. According to the UNODC: “Today, organized crime seems to be less a matter of a group of individuals who are involved in a range of illicit activities, and more a matter of a group of illicit activities in which some individuals and groups are presently involved.”36 This market-based understanding is particularly important for the United States, as its citizens are the main consumers of these goods, a fact that has not changed under the current strategy.37 According to the Financial Times’ Mexico and Central America correspondent, “the hard facts show an increase in demand, a demand that continues to place a lot of pressure on the market.”38 The current one-sided focus on supply is not only less than optimal; it is in some cases harmful. Placing pressure only, or in large part, on the criminal groups that produce and traffic illegal drugs not only increases both the profitability and violence associated with the trade, it unfairly burdens developing countries with the cost of handling an issue that affects all nations, an effort they may not be capable of sustaining.39 91 VOLUME XXIII, NUMBER 1 · FALL 2014

IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME To make effective progress towards reducing the demand for illicit goods, the United States will need to develop new social programs and expand on existing ones. This shift is in fact already underway, but requires increased focus and funds. Despite international action remaining greatly focused on supply-side measures, President Obama and his top advisors have in recent years recognized the need for prevention and treatment, and have been more overt concerning the way demand at home fuels international crime.40 Such an understanding is beginning to promulgate worldwide, to other developed nations and international organizations. A report by the Council on Foreign Relations states that: “Nations and international institutions … are slowly integrating public health, development, and community-based practices to decrease not only the supply but also the demand for illicit commodities.”41 But the United States is far from where it needs to be in terms of shifting to demand-oriented programs. The bulk of U.S. effort, measured in both staffing and funds, remains positioned behind the War on Drugs and other criminal law enforcement programs, despite their poor track record. The UN Global Commission on Drug Policy recommended in a 2011 publication that a “paradigm shift to public health rather than criminalization” take place, recognizing that in spite of the $2.5 trillion spent worldwide on the U.S.-led War on Drugs, the policy has “failed, primarily because of its focus on law enforcement.”42 This massive policy failure is supported empirically by both quantitative and qualitative data sets. Despite the intended outcomes of the War on Drugs, the scale and scope of illegal international drug markets has, in practice, grown substantially over the period of time in which the policy has been in place.43 Consumption of controlled substances, particularly opiates and cocaine, have risen by around 30% from 1998 to 2008 alone, and HIV rates among drug injectors in the United States remain more than four times as high as comparably developed nations like Australia and the United Kingdom that employ more comprehensive harm reduction strategies. 44 Subject matter experts, as well as the UNODC, have argued in favor of promoting social programs aimed at education, addiction treatment, and 92 INTERNATIONAL AFFAIRS REVIEW

JOHN DRISCOLL health improvement instead of criminal law enforcement, to bring demand efforts in line with the current supply initiatives.45 Where the War on Drugs has proven inadequate, U.S. alternative social programs have demonstrated real utility. A program which has substituted imprisonment for drug charges with addiction management and treatment has been reported by the Council on Foreign Relations to be “75 percent more successful at preventing recidivism than incarceration,” and has even been found to reduce the crime associated with the drug trade where the program has been active.46 One potential option for the United States, ending prohibition practices on drugs, has been gaining support from high-level politicians. Former presidents Jimmy Carter and Bill Clinton, both of whom funded the War on Drugs and supported criminalization while in office, currently say the approach is flawed.47 “‘We could have fighting and killing over cigarettes if we made it a felony to sell a cigarette,’ said former President Clinton.

‘So we legalized them. If all you try to do is find a police or military solution to the problem, a lot of people die and it doesn’t solve the problem.’”48 Along the same lines, analogies have also been made to the U.S. prohibition of alcohol, a program that failed to such a degree that it caused a great boon for organized crime and widespread anger with the federal government, leading to its eventual repeal. In recent years legislation has arisen supporting this very idea, with decriminalization of marijuana sweeping several states in the nation, and outright legalization of recreational use beginning in the states of Washington and Colorado in January of 2014.49 The possible benefits of alternative, non-criminal policies do not pertain solely to marijuana, however, but extend to the most dangerous drugs, even heroin, where drug substitution programs have resulted in a decrease in both overall addiction rates and violence.50 The criminal prosecution of these offenders in fact creates serious negative externalities that are directly in contrast with the goals of the U.S. strategy on TOC. According to a member of the Global Drug Commission, tenfold 93 VOLUME XXIII, NUMBER 1 · FALL 2014

IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME increases in the number of Americans in the correctional system for drug crimes over the last three decades, coupled with excessively long prison sentences, has had a major impact on the “ballooning” of the domestic prison population.51 The economic cost of increased incarceration is substantial. A Pew study has concluded that it costs the United States an average of $30,000 a year to incarcerate an inmate, while the nation spends only an average $11,665 per public school student.52 Over half a million people currently imprisoned on drug charges, with an average cost of $30,000 per inmate, means a total cost of over $15 billion annually, money that would make much greater progress towards the ultimate goals of the U.S. strategy if it was spent on social programs, treating addiction, education, and creating real reduction in demand.

The need to understand organized criminal activity as a market is very clear. Addressing supply alone, or in large majority, is an ineffective longterm strategy for reducing the threats posed by TOC and achieving the ultimate goals of the United States federal government. Social programs and decriminalization could provide excellent alternatives to the status quo, and have been proven effective, where the current War on Drugs has been proven a failure. The results of studies on alternative anti-drug policies have demonstrated their successful impact in decreasing the sale of illicit drugs, and shows that they “have actually decreased violence more than law enforcement interventions.”53 Programs and legislation have begun to shift towards these demand reducing factors, but they still pale in comparison to the resources and legislation placed behind criminal law efforts. Alternative programs focused on reducing national drug demand remain “the exception rather than the rule.”54 Proper Metrics for Success: To properly measure the effect of any program aimed at combating TOC, a significant amount of data is required. However, with criminal activities being inherently secretive in nature, and taking place on the black market, accurate data is extremely difficult to come by. The practical implications of this should not be underestimated: the lack of real data and the difficulty of accurately measuring criminal activity obstruct all processes of attempting to create effective TOC strategies.55 94 INTERNATIONAL AFFAIRS REVIEW

JOHN DRISCOLL In the absence of significant data regarding organized criminal activities, U.S. programs have taken to measuring easily obtained statistics to quantify the progress made by its initiatives. These measurements are often misleading and can promote the illusion of success in cases where it may not be a reality. Current metrics for TOC strategy success revolve around arrests, seizures, and the confiscation of assets.56 However, an increase in arrests or seizures does not necessarily correlate to a drop in violence, illicit good consumption, or to increases in public health. The U.S. strategy on TOC needs to develop accurate metrics for success that measure ultimate goals, not intermediate activities.

Developing proper metrics for a program or set of programs that lack sufficient data is possible. The central factor is to develop a point of reference by which progress of the U.S. TOC strategy can be measured.

One quantitative analyst has designed such a process: “The matching techniques consist of using the set of X variables to locate the ‘clone’ of each beneficiary as the person, or people, who is not a beneficiary of the project and has the closest structure of X characteristics to the beneficiary he will be the ‘clone’ of.”57 These points of reference, or “clones,” can be communities within or outside of the United States that share congruent levels of the factors intended to be measured, in this case the ultimate goals of the U.S. TOC strategy: drug use, drug related violence, public health statistics, etc. Such a strategy can be used to measure both the presence and absence of specific policy options. For example, the clone strategy can be employed to measure the long-term effects of marijuana legalization in urban, developed cities by comparing Amsterdam, where legal marijuana has been available for some time, to San Francisco, where it has not. This exact study was in fact undertaken, and found that San Francisco’s repressive policies had no effect on drug use compared to Amsterdam’s non-criminal policy.58 In cases where clone communities are not evident, measurements can be made based on a “without project situation.” “In general, the ‘without project situation’ implies maintaining the status quo, projecting its normal evolution in certain cases. The benefits of the project are measured and valued by what the project adds beyond that state.”59 95 VOLUME XXIII, NUMBER 1 · FALL 2014

IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME By choosing the appropriate “clone” or properly quantifying the “without project situation” to act as a control group to which TOC strategy programs are not provided, measurements can then be made with certain assurances for causation.60 By utilizing such methods, the progress towards the ultimate goals of the U.S. TOC strategy can be accurately measured, instead of focusing on intermediate activities. Such methods can be applied to both the criminal law enforcement and military efforts as well as social programs aimed at demand reduction.

International and Multilateral Efforts: International criminal groups and networks are not constrained by the borders to which states limit the extension of the use of force, jurisdiction, or legislative authority.

Prosecutors combatting an international criminal group must regularly work in and with several different countries to build a single case.61 The criminal law enforcement institutions in the United States, however, are not historically designed for this; they have been constructed with the explicit goal of operating within their national boundaries.62 Therefore, a shift in strategy is required away from U.S. federal and unilateral efforts towards international and multilateral initiatives to combat TOC. These international initiatives need to strike the same balance between supply and demand oriented programs, much like this paper has proposed for the United States internally. While Washington does currently support a number of international programs on organized crime such as Plan Colombia or the Mérida Initiative, the major U.S. bilateral security agreement with Mexico concerning drug trafficking, they are too few in number. Besides, despite being nominally international, these efforts measure progress only in accordance with U.S. strategy. Such aid is “overwhelmingly military, and funding for more comprehensive solutions has consistently decreased year after year.”63 Overall, the United States has continued to demonstrate incredible difficulty in moving from rhetorical declarations of international cooperation to the construction of real strategic multilateral cooperation mechanisms.64 To demonstrate the internally minded nature of U.S. international programs, one must look no further than its southern border with Mexico.

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JOHN DRISCOLL The U.S. and Mexican governments support bilateral efforts to stop the flow of illicit goods across the border. While the United States has spent over $30 billion in the last two decades protecting against the trafficking of illicit goods and humans into the country, “it has virtually nothing in place to check, let alone stop, what is flowing out.”65 This allows the free passage of illicit goods, mainly weapons, from the United States into Mexico, which upon arrival become extremely detrimental to efforts to fight organized crime, specifically drug trafficking, in the region, as cartel members utilize these weapons against the very forces aimed at combatting them.66 This is not a result of a lack of resources or poor enforcement; it is a direct outcome of a federal U.S. strategy that is internally-focused. In Laredo, Texas, at the largest border crossing station, monitoring outbound traffic for illicit goods is such a foreign concept that the federal government does not even own the six lanes headed into Mexico, they in fact belong to the city.67 Looking abroad, one finds that comprehensive multilateral and intergovernmental strategies to combat TOC are not without precedent.

For decades now, member states of the European Union have been forging a common security agenda around the issue of organized crime.68 This effort goes beyond cooperation or mutual assistance all the way to a premeditated alignment of policies and laws, as member states are required to coordinate their individual national laws on organized crime with the rest of the region.69 Such a strategy has allowed for more law enforcement and judicial cooperation among the countries in the region, and resulted in very real progress against criminal networks.70 The most famous example is prosecutor Giovanni Falcone’s efforts against the Italian Mafia. Falcone’s prosecution, which dealt a debilitating blow to Italian organized crime, was underpinned by an acute understanding that such criminal activity was not merely a national problem. Significant cooperation with authorities in other countries played a major role in his success.71 While the United States does not belong to a supranational body akin to the European Union, it can make use of the United Nations (UN), another key resource in international efforts against TOC. Coming into force in 97 VOLUME XXIII, NUMBER 1 · FALL 2014

IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME 2003, the United Nations Convention on Transnational Organized Crime (UNTOC) currently exists as the central treaty addressing the issue, and the only comprehensive multilateral tool in effect.72 The federal focus of the U.S. strategy has left problems like southbound weapons trafficking into Mexico occurring unchecked, due to one-sided negotiating resulting from U.S. relative strength and pool of resources. In contrast, utilizing a global forum such as the UN to address TOC mitigates the impact of bilateral negotiating power on the content of agreements, thereby offering developing countries relative parity with their developed counterparts.73 This parity is crucial in the long-term effort to counter the threats of organized criminal activity, as the universal nature of effective international norms, and the active support of both developed and developing nations, is absolutely paramount.

The UN is already striving to address the international trafficking of drugs, and has programs in place that could make significant strides with greater resource support from the United States. The United Nations Office on Drugs and Crime (UNODC) operates a number of programs aimed at a wide variety of issues concerning TOC. The UNODC operates worldwide, spearheading efforts at evaluating the scale and practices of the illegal drug market, implementing state awareness programs, offering treatment support, and improving judicial frameworks to better handle the challenges posed by organized crime.74 The UNODC also operates programs to check containers for maritime shipment of illegal narcotics, programs for anti-corruption, alternative livelihood economic development, and serves as a hub for disseminating data as well as best practices for counter-TOC efforts.75 Despite promoting nominally international or multilateral initiatives, the U.S. strategy remains in large part federal and unilateral in nature. It has failed to adopt relevant protocols from the UN, largely as a result of the lack of political will to meet the requirement of enacting matching domestic legislation for these protocols, and concentrates solely on illicit trafficking into the country, despite the negative effects of outbound weapons on its overall TOC strategy. For effective progress towards the goals of its strategy, the United States must take greater steps to promote 98 INTERNATIONAL AFFAIRS REVIEW

JOHN DRISCOLL and develop international and multilateral action on an issue as complex and wide reaching as organized crime.

Difficulties Associated with International Action Addressing security issues through multilateral efforts, and working within the UN to promote strategy development is not without its difficulties. The UN is largely underfunded, lacks enforcement mechanisms for its resolutions, and international security cooperation raises sensitive issues around sovereignty, wherein nations jealously guard judicial and policing authorities and are reluctant to cooperate or release domestic intelligence.76 Part of the European Union’s success comes from the fact that it operates based on the acquis communitaire, a binding legal document with consequential regional enforcement mechanisms capable of compelling member states to adopt and comply with protocols.77 The UNTOC, on the other hand, lacks implementation mechanisms that would provide motivation for countries that are not willing, or capable of adhering to the convention's guidelines, resulting in an overall lack of action and neglect of responsibilities, for which the former UNODC director has chastised member states.78 Beyond enforcement capacity, the UN simply lacks the funds required to reach its goals, as the UNODC remains over 90 percent funded by voluntary contributions and suffers from chronic understaffing and funding deficits.79 While the United States remains a top contributor to the UN budget, congress has placed a cap on contributions, independent of funding assessments made by the UN towards each member state based on their gross national income. Nevertheless, Washington will have to overcome these obstacles, as increased multilateral effort would be a crucial aspect of a truly effective TOC strategy.

Conclusions Creating a comprehensive national strategy to combat TOC, and its crucial subset, drug trafficking, is no simple task, but one that the current international criminal climate necessitates. Past efforts by the United 99 VOLUME XXIII, NUMBER 1 · FALL 2014

IMPROVING U.S. STRATEGY ON TRANSNATIONAL ORGANIZED CRIME States in this regard have fallen short of effective development and implementation due to a number of specific failures. The overwhelming focus on criminal law enforcement and military measures to combat organized crime, the use of improper metrics to measure the success of the strategy’s ultimate goals, and the lack of meaningful international and multilateral initiatives on TOC have resulted in insufficient, and, at times, negative progress. In order to remedy this situation, significant paradigm shifts in approach to the threats of international organized crime will need to take place. Programs oriented towards demand reduction will need to be created, funded, and studied in equal fashion to the law enforcement and military supply-side programs already in place. An important aspect of this shift will be a movement away from the prohibition regime that has dominated U.S. policy, including the creation of health based options like drug substitution programs, and the potential decriminalization or even legalization of substances like marijuana. Proper metrics to measure progress, based on entirely different data collection and analysis protocols, will need to be employed to ensure accurate measurement of ultimate goals, not merely intermediate objectives. Finally, greater importance, efforts, and funds must be allocated to international and multilateral initiatives on TOC, including utilizing the UN as a valuable resource and improving bilateral agreements. The evolving nature of transnational organized crime in recent decades must be met with informed, enlightened, and innovative strategies if the United States is to keep pace with such dynamic threats.

Endnotes 1

Transnational Organised Crime, ed. Adam Edwards and Peter Gill. (Abindon: Taylor & Francis, 2003), 176.

2 Transnational Organized Crime & International Security: Business as Usual? ed. Mats Berdal and Monica Serrano. (Boulder, Colo.: Lynne Rienner Publisher, 2002), 101.

3 Ibid., 2.

4 Ibid.

5 Council on Foreign Relations, “The Global Regime for Transnational Crime,” June 25, 2013, Scope of the Challenge, http://www.cfr.org/transnational-crime/global-regimetransnational-crime/p28656 6 Berdal and Serrano, 96.

7 Ibid.

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8

Ibid., 29.

Council on Foreign Relations, Scope of the Challenge.

10 United Nations Office on Drugs and Crime, “The Globalization of Crime,” 2010. https://www.unodc.org/documents/data-and-analysis/tocta/TOCTA_Report_2010_low _res.pdf 11 Berdal and Serrano, 2.

12 Edwards and Gill, 60.

13 Berdal and Serrano, 2.

14 United States Government National Security Council. “Strategy to Combat Transnational Organized Crime,” July 25, 2011, http://www.whitehouse.gov/ administration/eop/nsc/transnational-crime/strategy 15 U.S. Senate Subcommittee on Crime and Terrorism, “Combating international organized crime: evaluating current authorities, tools, and resources,” 2013, 4, http://www.gpo.gov/fdsys/pkg/CHRG-112shrg81638/pdf/CHRG-112shrg81638.pdf 16 Executive Office of the President of the United States. “National Drug Control Strategy,” 2013, 3, http://www.whitehouse.gov/sites/default/files/ndcs_2013.pdf 17 Edwards and Gill, 4.

18 Council on Foreign Relations, Overall Assessment.

19 Ibid., Narcotrafficking.

20 Ibid., Building Norms.

21 Edwards and Gill, 63.

22 Ibid.

23 Council on Foreign Relations, Narcotrafficking.

24 Berdal and Serrano, 30.

25 Senate Subcommittee on Crime and Terrorism, 3.

26 Berdal and Serrano, 5.

27 Edwards and Gill, 178.

28 Ibid.

29 Drug Policy Alliance, “Drug War Statistics,” 2014, http://www.drugpolicy.org/drugwar-statistics 30 United Nations Office on Drugs and Crime, 5.

31 “U.S. Vows to Continue War on Drugs," voanews.com, February 28, 2012, http://www.voanews.com/content/us-vows-to-continue-war-on-drugs-140706933/ 164700.html 32 Edwards and Gill, 10.

33 Gavril Paraschiv, “Conceptualizing Transnational Organized Crime,” Economics, Management and Financial Markets 8, no. 2 (June/2013): 6, http://search.proquest.com. proxygw.wrlc.org/docview/1433041995?pq-origsite=summon 34 Council on Foreign Relations, Building Norms.

35 Juan Garzon et al., “The Criminal Diaspora: The Spread of Transnational Organized Crime and How to Contain its Expansion,” Woodrow Wilson International Center for 9

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Scholars, 2013, 2, http://wilsoncenter.org/sites/default/files/CRIMINAL_DIASPORA %20(Eng%20Summary).pdf 36 United Nations Office on Drugs and Crime, 29.

37 Berdal and Serrano, 96.

38 Adam Thomson, “Mexico Criticizes U.S. Drug War Efforts,” Financial Times, March 30, 2006, http://search.proquest.com.proxygw.wrlc.org/docview/228902116?pqorigsite=summon 39 Council on Foreign Relations, U.S. and International Transnational Organized Crime Policy Issues.

40 Ibid., Building Norms.

41 Ibid.

42 Ibid., Narcotrafficking.

43 Global Commission on Drug Policy, “War on Drugs: Report of the Global Commission on Drug Policy,” 2011, 4, http://www.globalcommissionondrugs.org/wp-content/themes/ gcdp_v1/pdf/Global_Commission_Report_English.pdf 44 Ibid.

45 Ibid.

46 Ibid.

47 Nicole Flatow, “Bill Clinton Joins World Leaders in Declaring Drug War Failure,” December 10, 2012, http://thinkprogress.org/justice/2012/12/10/1309711/bill-clintonjoins-world-leaders-in-declaring-drug-war-failure/ 48 Ibid.

49 Ray Sanchez and Martin Martinez, “Colorado Pot Law Called Springboard for Other States,” January 6, 2014, http://www.cnn.com/2014/01/03/us/marijuana-laws-unitedstates/ 50 Council on Foreign Relations, Support Evidence-Based Drug Policy.

51 Richard Branson, “War on Drugs a Trillion Dollar Failure,” December 7, 2012, http://www.cnn.com/2012/12/06/opinion/branson-end-war-on-drugs/ 52 Ibid.

53 Council on Foreign Relations, Support Evidence-Based Drug Policy.

54 Ibid., Narcotrafficking.

55 Ibid., Overall Assessment.

56 Edwards and Gill, 178.

57 Arístides Torche, “Assessing Real Benefits Of A Social Program. From Counterfactual To A Measure Of Its Impact,” Cuadernos de Economía, 40, no. 121 (December/2003) 58 “War on Drugs: Report of the Global Commission on Drug Policy,” 10.

59 Ibid.

60 Ibid.

61 Ibid.

62 Council on Foreign Relations, Scope of the Challenge.

63 Ibid.

64 Juan Garzon, Marianna Olinger, et al., 2.

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65

Cam Simpson, “Flow of Weapons Targeted,” Wall Street Journal Europe, April 17, 2009, https://global-factiva-com.proxygw.wrlc.org/ga/default.aspx 66 Ibid.

67 Ibid.

68 Edwards and Gill, 8.

69 Gavril Paraschiv, 10.

70 Edwards and Gill, 128.

71 Berdal and Serrano, 84.

72 Council on Foreign Relations, Building Norms.

73 Berdal and Serrano, 85.

74 Council on Foreign Relations, Narcotrafficking.

75 Ibid.

76 Ibid., Narcotrafficking.

77 Edwards and Gill, 128.

78 Council on Foreign Relations, Building Norms.

79 Ibid., Overall Assessment.

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LNG EXPORTS TO JAPAN

LNG Exports to Japan: Recommendations for Opening the U.S. Market Julia Collins, Barbara Adair, Rodolfo De la Cruz, John Gillis, Zheng Zhu Barbara Adair earned a master’s degree in International Affairs at the Elliott School of International Affairs in 2014. She has worked for Hillary Rodham Clinton in the U.S. Senate, and is currently at the U.S. Department of State. Julia Collins will graduate with a master’s degree in International Affairs from the Elliott School of International Affairs in fall 2014, having completed her undergraduate studies at UCLA. She speaks Hungarian and works for ExxonMobil. Rodolfo De la Cruz earned a B.A. in Conflict Analysis and Resolution from George Mason University in 2009, and an M.A. from the Elliott School of International Affairs in 2014.

An army reservist for 10 years, he is currently a program analyst for the U.S. Department of Defense. John Gillis is a U.S. Army veteran and graduated with a master’s degree in International Affairs from the Elliott School of International Affairs in 2014, specializing in Transnational Security and Energy Security. He holds a B.A. in Political Science from Loyola College, Maryland. Zheng Zhu is a cross-border investment researcher at Rhodium Group and graduated from the Elliott School of International Affairs in 2014 with a master’s degree in International Affairs. He holds a bachelor’s degree in International Studies from the University of Nottingham-China Campus.

Abstract By increasing liquefied natural gas (LNG) exports to Japan, the United States will enjoy a more favorable trade balance, advance carbon-reduction goals, and increase geopolitical stability. The United States must urgently pursue the following steps in order to take full advantage of the current market: 1. Increase funding for Department of Energy personnel support 2. Establish a blanket waiver with the DOE Office of Fossil Fuels 104 INTERNATIONAL AFFAIRS REVIEW

JULIA COLLINS, ET AL. 3. Nominate a special committee on U.S. liquefied natural gas 4. Prioritize finalizing the Trans-Pacific Partnership 5. Raise public awareness The State of LNG in the United States and Japan Since the 1990s, natural gas has played an influential role in the United States’ energy market. As a clean-burning, abundant fuel, natural gas is a prevalent resource in North America, and has become even more accessible through technological advancements in hydraulic fracturing and horizontal drilling. As a result, 95% of natural gas consumed in the United States comes from domestic and Canadian sources, and there is an increased and persistent demand for U.S. natural gas exports throughout the world. Nevertheless, this has been a contentious issue for years, with coalitions in both the House and Senate debating the United States entrance to the global market. As the law stands, it is very difficult for U.S. firms to export gas to countries with which the U.S. does not have a free trade agreement. The Obama administration and the Department of Energy (DOE) have recently moved forward in approving a liquefaction terminal for the exportation of U.S. liquefied natural gas (LNG) but only after a lengthy bureaucratic process. This is just the first of many projects that should be prioritized.1 Considering the increasingly competitive LNG export climate, the United States faces a shrinking window of opportunity to enter and maintain a competitive advantage in the global market. As such, the United States must open more export facilities, and should establish long-term contracts and agreements to ensure the competitiveness of U.S. natural gas. With this in mind, Japan is an obvious and potentially profitable partner in gas exports. Following the Fukushima nuclear reactor meltdown, Japan has actively pursued alternative sources of energy. Although Japan has recently reactivated some nuclear plants, almost all of Japan’s power generation has been replaced by oil and 105 VOLUME XXIII, NUMBER 1 · FALL 2014

LNG EXPORTS TO JAPAN natural gas. In fact, Japan is now the world’s largest importer of LNG. Considering its high level of demand, this is a major potential market for the United States and reinforces longstanding political and economic ties.2

Figure 1: Rising LNG Consumption in Japan3 Viewing U.S. LNG exports from an industry perspective, the case is even clearer. LNG projects are driven by demand from the buyer. Once a buyer commits, particularly for long-term purchase agreements, the lowest cost offered by a sufficiently large and reliable supplier like the United States will prevail. With many LNG projects driven by the buyer's willingness to sign a long-term purchase agreement, the prospect of an agreement is encouraging. With a strong trade agreement or purchasing structure in place, suppliers in the United States can deliver gas to Japan at a lower, competitive price relative to other energy sources. Furthermore, the abundant natural gas reserves in the United States assure the sustainability of supply.4 The United States must ensure the lowest costs to the buyer from start to finish. Beyond the contract costs and negotiating processes, the buyer 106 INTERNATIONAL AFFAIRS REVIEW

JULIA COLLINS, ET AL. must also pay for transportation and regasification costs under existing structures. Because Japan has extensive regasification infrastructure already in place, with corresponding port access and existing storage facilities, its costs will be minimal. Unlike other potential partners, Japan is prepared to meet higher levels of imports if the United States is able to increase export facilities. Other countries have yet to build significant import facilities and regasification infrastructure.5 Ultimately, Japan is prepared, but the United States is not. Political and physical obstacles to exportation remain, which the United States must address to move forward with LNG exports.

Challenges LNG terminals must obtain approvals before converting existing import facilities into export facilities. Ongoing delays in updating and building LNG export infrastructure, as well as competition from other countries are key obstacles. Timing also poses a challenge. The United States must act quickly to maximize the economic and strategic gains to be made from LNG exports to Japan. On the Japanese side, the risk of a drop in demand would reduce the incentives and competitive advantage that U.S. suppliers currently have due to the price differences between the Japanese and the American markets.

Approval Complications Before LNG producers can export, they must first receive approval from the Department of Energy’s Office of Fossil Fuels (OFF).6 Exporting to countries with free trade agreements requires a simple approval process, but exporting LNG to any country without a free trade agreement involves a much more bureaucratic process. Since 2011, the OFF has granted only six approvals for LNG exports. Meanwhile, an additional twenty applications are currently awaiting approval.

The DOE has an inefficient process for sorting applications. The applications themselves can be lengthy, and often include public statements and comments that require review. As part of the review, the 107 VOLUME XXIII, NUMBER 1 · FALL 2014

LNG EXPORTS TO JAPAN department must assess the impact of the proposed export terminal on the U.S. economy. Additionally, the regulatory body of the DOE, the Federal Energy Regulatory Commission (FERC), must approve construction plans for the liquefaction plants. The commission is responsible for ensuring that liquefaction plants meet 79 different conditions to avoid negative environmental impacts.7 LNG terminals usually do not apply for FERC approval until after they are cleared to export by the Office of Fossil Fuels.

Therefore, any setback in the initial approval pushes back FERC approval, which delays the construction of the liquefaction plants. The Energy Department clearly needs a more streamlined system to process the applications at a faster rate.

The Natural Gas Act of 1938 requires proposed exports to be consistent with the public interest, but proving this fact has gridlocked the approval process. Two main parties oppose the export of LNG and aim to sway public opinion against exports: domestic manufacturers and environmental activists. Manufacturers, which use LNG as an input for their products, do not want gas prices to increase. They have benefited from lower natural gas costs in the United States and stand to lose profits if exports are approved. As a result, manufacturers are threatening to lay off workers if exports are approved.

Environmental groups, on the other hand, are opposed to the process used to extract natural gas, known as hydraulic fracturing. They believe that approving LNG export plans will encourage and expand hydraulic fracturing in natural gas production, which will create further ecological and environmental damage. Their mission is to gain public support to prove that LNG exports are not in the public interest.

Despite opposition groups, the DOE has reviewed economic studies in favor and against LNG exports to countries without free trade agreements, and polling data confirms that the public supports LNG exports.8 But demonstrated public interest has not hastened the review of additional export applications.

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JULIA COLLINS, ET AL. Infrastructure The United States lacks significant infrastructure to export LNG by sea.

Current exports of natural gas pass through pipelines to Mexico and Canada. Exporting LNG will require liquefaction plants at LNG terminals that are currently equipped only for importing. This is the second challenge for increasing LNG exports. For example, in February the DOE granted approval for Sempra Energy to export LNG to Japan and India on a twenty-year long-term contract through the Cameron LNG terminal.

Before doing so, Sempra Energy must first construct a liquefaction plant capable of processing 1.7 billion cubic feet per day (Bcf/d) of LNG.9 Although construction began in October 2014, the first stages of operations are not anticipated to begin until 2018, and at least four years stands in the way of actual exports. This facility expansion is estimated to cost $10 billion.10 The conversion of infrastructure from import- to exportready is extremely expensive and time-consuming.

Japan’s Domestic Climate One of the biggest threats to U.S. LNG producers is decreased demand from Japan, particularly if Japan resumes the use of nuclear reactors for power generation after the Fukushima reactor disaster of 2011. Recently, candidates in the Tokyo mayoral election debated the future of nuclear power in Japan, suggesting that politicians are at least considering restarting nuclear reactors for power generation, but public trust in nuclear power is still shaken. In this context, the government is concerned about the rising costs of LNG imports. If Japan’s government decides to use more nuclear power plants, it might reduce demand for LNG. Therefore, the U.S. has a closing window of opportunity to export LNG to Japan. In order to take advantage of the price differences, construction of the liquefaction plants needs to begin as quickly as possible to take full advantage of a favorable market.

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Figure 2: U.S. and Japanese LNG prices, 201311 In March of 2013, LNG prices at major U.S. distribution point Henry Hub stood at $3.49, compared to $19.75 in Japanese markets. Two important factors shape this disparity. First, Japan lacks domestic natural gas resources, and relies on imports. In the past, China supplied LNG to Japan, but has pulled back as growing internal demand has made it a net importer. Japan needs new sources of LNG. Second, Japan has suffered two decades of stagnant economic growth. To stimulate the economy, the Bank of Japan recently implemented a monetary policy to expand the money supply, which devalued its currency against the U.S. dollar.

Because of this, LNG is much more expensive in Japan. High natural gas prices in Japan help to explain why the national government is interested in resuming nuclear reactor use: It is a cheaper alternative for power generation.

Competing Countries Further complicating the prospects for U.S. LNG exports are uncertainties over the future global supply of LNG. Australia and Qatar, among other countries, have expanded LNG exports in recent years and are well-placed to supply potential customers in Asia and Europe. Due to the cost of 110 INTERNATIONAL AFFAIRS REVIEW

JULIA COLLINS, ET AL. liquefying and transporting gas, U.S. exports may not remain costcompetitive if Japan’s closer neighbors begin exporting substantial amounts of LNG quickly.

Why Export to Japan?

U.S. Domestic Economic Analysis Many argue that exporting liquefied natural gas will increase American natural gas prices. This raises concerns for utility companies and many industrial users.12 These fears are offset by the anticipated economic impact of LNG exports on the United States presented by the National Economic Research Associates (NERA) in a recent report.13 This analysis describes why exporting domestic natural gas will positively impact the U.S. trade balance and advance the adoption of the cleaner-burning fuel around the world.

NERA predicts that total U.S. “dry” natural gas production will be between 67 and 81 billion cubic feet per day (Bcf/d) in 2020, while shale gas production will account for 25 to 38 Bcf/d. American domestic consumption is estimated at 68 to 77 Bcf/d. Comparing future consumption and production, the supply of U.S. gas will exceed domestic consumption in the next few decades. Moreover, any price increase for natural gas will incentivize production, preventing domestic gas prices from experiencing exaggerated increases. Overall, U.S. LNG exports are projected to moderately increase U.S. natural gas prices by $0.32 to $1.02 per Million British Thermal Units (MMBtu) between 2016 and 2035.

Future U.S. gas prices will not approach previous price peaks caused by inconsistent supply, pipeline dependency, restricted regional markets, and drastic increases in demand.14 New developments in natural gas markets have reduced the risk of these price spikes.

LNG exports can adversely affect some sectors of the domestic economy.

Energy-intensive U.S. manufacturers in particular, who rely on natural gas as a fuel or feedstock, could be subject to price impacts as the result of competition. However, any increase in the price of natural gas would be 111 VOLUME XXIII, NUMBER 1 · FALL 2014

LNG EXPORTS TO JAPAN limited, and even a major price increase in the domestic natural gas market would not make supplies unaffordable. If an exponential increase occurred, it would not be economic to export U.S. LNG if prices rise above the cost of competing supplies from other countries or regions.

Therefore, with an extreme price increase, exports would slow and the domestic price would settle at a lower point with an increase in domestic supply. NERA calculates that the United States can reap large profits from LNG exports, which would more than outweigh the costs of the price increase caused by the exports. Scenarios with unlimited exports of shale gas are predicted to consistently lead to higher U.S. GDP than corresponding cases with limited exports.15

Figure 3: Projected contribution to GDP of LNG exports16 The extra GDP created by LNG exports can reach $115 billion when the multiplier effect is taken into account in the “high export� case. Besides the GDP benefit, the United States would realize net employment benefits from allowing LNG exports. The increase in labor demand in energy production and extraction equipment manufacturing sectors will outmatch limited job losses of energy-intensive manufacturing. As a result, the net direct and indirect employment impact in the United States is an expected increase of 30,000 to 122,000 jobs by 2035. Across all industries 112 INTERNATIONAL AFFAIRS REVIEW

JULIA COLLINS, ET AL. benefiting from LNG exports, the number could reach 543,000 jobs by 2035 in the “high exports case.”

Prominent think tanks such as the Brookings Institution and the Center for Strategic and International Studies agree that the United States stands to gain as a net exporter of natural gas.17 Net benefits to would be highest if the United States is able to produce shale gas at a low cost, world demand for natural gas increases rapidly, and LNG supplies from other regions are limited. Even if these conditions are not met, allowing exports of LNG would cause limited change in natural gas prices and no harm to the economy overall.

U.S. economic welfare will increase as the volume of LNG exports increases. There is a slight forecasted increase in natural gas domestic prices, but there is also an important and corresponding rise in the value of LNG exports. As mentioned before, and as shown in the ICF estimates, this is because there is a net gain for the U.S. economy across a broad set of indicators, including economic wellbeing and rises in GDP. This, in turn, results in a wealth transfer from overseas in the form of payments for the liquefaction services completed in the United States.

U.S. Strategic Interest Analysis Exporting LNG to Japan makes strategic sense for the United States. The economic impact will enhance President Obama’s “Pivot towards Asia.” trans-Pacific trade is worth hundreds of billions of dollars annually, and U.S. exports to the Asia-Pacific region totaled $895 billion in 2011.18 LNG exports to Japan will reinforce an economic and strategic focus on Asia. Aided by LNG exports to Japan, the United States will keep a foothold and open access to the region.

Japan is the number one LNG importer in the world.19 Additionally, postFukushima Japan depends on natural gas now that its demand has shifted away from nuclear sources. American gas exports to allies such as Japan allow for more steady energy markets that reinforce strategic partnerships.20 There are regasification plants along much of Japan’s 113 VOLUME XXIII, NUMBER 1 · FALL 2014

LNG EXPORTS TO JAPAN coastline. Because of this mobility within the Japanese market, there are no significant variations in domestic prices. Japan has invested a significant amount of capital into natural gas projects regionally and around the world to ensure a steadier incoming stream of LNG.21 Although the market in Japan is ideal for U.S. entry, the window is shrinking. The price advantage of U.S. LNG exports is finite and by no means guaranteed. Of the 7,299 trillion cubic feet of natural gas resources estimated in shale deposits around the world, 75 percent lie outside the United States.22 The export of shale fracturing technology to these locations threatens the current U.S. competitive advantage. Still, these countries will have to implement infrastructure adjustments to extract natural gas from reserves in often complex shale development, in addition to addressing laws, regulations, and policies related to property and mineral rights.

Japan, like many Asian LNG importers, is seeking to diversify its sources.

The pie chart below illustrates the balance of supply from Japan’s regional and non-regional trade partners. This represents an opportunity for the United States, as it signifies ease of entry into the market. Still, that advantage is not unique to the U.S., as others may just as easily enter. To this point, American entry to the Japanese market is already experiencing regional competition from Australia and Malaysia.23 Allowing U.S. liquefied natural gas exports to flow to Japan will deepen economic ties and reinforce the alliance with Japan.24 This will also stabilize Japanese energy markets after the Fukushima disaster, providing Japan a consistent supply of cheaper LNG. This further diversifies the market. Although U.S. LNG exports to Japan will expand American geopolitical influence in the region, it will not be a direct diplomatic tool.

In the end, American exporters are private companies, and will follow the best prices in markets.

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Figure 4: Japan’s LNG Exports by Source, 1990-201125 Due to these factors, geopolitical influence can expand, but liquefied natural gas exports cannot be wielded in the same fashion as oil by nationally owned oil companies and members of the Organization of the Petroleum Exporting Countries (OPEC): There is no international cartel influencing global gas prices.

Because of Japan’s approach to LNG imports, American LNG exports can only be used to positively influence the market and American relations with Japan. First, the natural gas market is regional, not global. Each region has different natural gas prices and different pricing mechanisms.

Japan has diversified its sources across regions and countries. Since LNG can be transported across oceans, Japan can import liquefied natural gas from a variety of sources.

Second, Japan imports LNG via terminals and not natural gas through pipelines. Because Japan is not pipeline-dependent outside of its own borders, it has great flexibility. In comparison, Europe is locked into its natural gas market with very few gasification/import terminals for LNG. 115 VOLUME XXIII, NUMBER 1 · FALL 2014

LNG EXPORTS TO JAPAN Furthermore, Europe is reliant on supply from Russia, with Russianowned pipelines as the main source of imports. With its concentrated and easily controlled supply routes, the European natural gas market is easily manipulated. Japan’s diverse sources and multiple points of entry allow for a flow of LNG that cannot be easily controlled by a single country.

LNG exports from the United States would further diversify Japanese energy sources, and provide Japan lower natural gas prices. This would allow Japan to consume American LNG while contributing to its own energy security.

Recommendations for Facilitating U.S. LNG Exports It is clear from an economic and strategic standpoint that the benefits of exporting LNG to Japan far outweigh the costs. But there is a decreasing window of opportunity to utilize the United States’ “first-mover advantage.”26 We have five recommendations for facilitating and accelerating U.S. LNG exports to Japan before it is too late: 1. Increase Funding Personnel Support

for

DOE

In order to export LNG, the DOE must first grant permission for the natural gas to leave the country.

Only then can FERC take the second step: approving the permit to build liquefaction plants and export facilities. Of the almost two dozen applications waiting to be processed since 2011, only six have been officially approved through this lengthy two-step process. Allocating more funding to DOE and FERC will allow the hiring of additional employees, who can help applicants navigate the complicated application process and review paperwork.

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JULIA COLLINS, ET AL. 2. Establish a Blanket Waiver with the DOE Office of Fossil Fuels The existing legal framework makes it more complicated for the United States to export to countries with which it does not have a free trade agreement. To expedite LNG exports to Japan (which does not have a free trade agreement with the United States) an exception should be established for the 20 companies that have already submitted export applications. This allows the free market to determine whether exporters will be competitive enough to survive. This will speed the path to the FERC’s regulatory processes, which will help convert, update, and build liquefaction plants.

3. Nominate a Special Committee on U.S. Liquefied Natural Gas To increase focus on this vital issue, the Obama administration should strongly advocate that the U.S. Congress formulate a special, bipartisan committee on U.S. LNG to quickly take advantage of the benefits associated with LNG export. This will increase congressional awareness and likely amend some of the slower parts of the federal regulatory process to export LNG to Japan.

4. Prioritize Finalizing the Trans-Pacific Partnership The lack of a free trade agreement increases the amount of red tape involved in exporting LNG to Japan. The Trans-Pacific Partnership (TPP) is a free trade agreement between the United States, Japan, Canada and nine other countries in the Asian Pacific region that has been in negotiations for almost ten years. The countries involved in this agreement are some of the America’s largest and rapidly growing trade partners.27 Once Japan is officially a free trade partner, the process of exporting LNG to Japan will be faster, more efficient, and the gains from exporting can be realized more quickly.

5. Raise Public Awareness The fifth and final recommendation is aimed at increasing public awareness of the positive impacts (U.S. growth, job creation) of exporting 117 VOLUME XXIII, NUMBER 1 · FALL 2014

LNG EXPORTS TO JAPAN LNG, especially to Japan. Educating the public will help to sway national opinion in favor of exportation. This is important because public support is a key component in acquiring the permits to export LNG that has often gridlocked the approval process. Increased public awareness will help minimize this problem.

Conclusion Although those opposed to U.S. LNG exports cite concerns about rising domestic natural gas prices, which could potentially hurt consumers and certain industries that currently enjoy low-cost natural gas, the positives of exporting LNG far outweigh the negatives. With increased LNG exports, the United States will enjoy a more favorable trade balance and advance domestic carbon reduction goals by encouraging the adoption of cleanerburning natural gas for fuel, while increasing geopolitical stability by supplying energy-poor U.S. allies with natural gas.

Endnotes 1

Keith Johnson, “The Geopolitics of Gas Exports,” foreignpolicy.com, February 11, 2014, http://www.foreignpolicy.com/articles/2014/02/11/the_geopolitics_of_gas_exports 2 U.S. Energy Information Administration, “Country Analysis: Japan,” http://www.eia.gov/countries/cab.cfm?fips=JA 3 Timera Energy, “Japanese Nuclear Restarts and the Global Gas Market,” May 6, 2013, http://www.timera-energy.com/energy-markets/japanese-nuclear-restarts-and-the-globalgas-market/ 4 Andrew Inkpen and Michael H. Moffett, The Global Oil & Gas Industry (Tulsa, Okla.: PennWell, 2011), 344.

5 Ibid., 346; Vivek Chandra, Fundamentals of Natural Gas: An International Perspective (Tulsa, Okla.: PennWell Corporation, 2006), 62-3.

6 U.S. Department of Energy Office of Fossil Energy, “Natural Gas Regulation,” http://energy.gov/fe/services/natural-gas-regulation 7 Federal Energy Regulatory Commission, “Fact Sheet: FERC Authorizes Cove Point LNG Project,” September 29, 2014, https://www.ferc.gov/media/news-releases/2014/ 2014-3/09-29-14-fact-sheet.pdf 8 Nick Snow, “DOE allows LNG Exports from Cameron Terminal to Non-FTA Nations,” Oil & Gas Journal, February 17, 2014, http://www.ogj.com/articles/2014/02/doe-allowslng-exports-from-cameron-terminal-to-non-fta-nations.html 9 Zacks Equity Research, “Stay Invested in Sempra,” February 6, 2014, http://www.zacks.com/stock/news/122269/Stay-Invested-in-Sempra

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10

Sempra Energy, “Cameron LNG Liquefaction Project Breaks Ground In Louisiana,” October 23, 2014, http://sempra.mediaroom.com/index.php?s=19080&item=136982 11 Federal Energy Regulatory Commission, “Natural Gas Overview,” March 2013.

12 Keith Johnson and Ben Lefebvre, “U.S. Approves Expanded Gas Exports,” Wall Street Journal, May 18, 2013, http://online.wsj.com/articles/SB100014241278873247670 04578489130300876450 13 NERA Economic Consulting, “Macroeconomic Impacts of LNG Exports from the United States,” December 3, 2012, 1, http://energy.gov/sites/prod/files/2013/04/f0/ nera_lng_report.pdf 14 Ibid.

15 ICF International, “U.S. LNG Exports: State-Level Impacts on Energy Markets and the Economy,” November 13, 2013, 1-3, http://www.api.org/~/media/Files/Policy/LNGExports/API-State-Level-LNG-Export-Report-by-ICF.pdf 16 ICF International, “U.S. LNG Exports: Impacts on Energy Markets and the Economy,” May 15, 2013, 11, http://www.api.org/~/media/Files/Policy/LNG-Exports/API-LNGExport-Report-by-ICF.pdf 17 Charles Ebinger, Kevin Massy, and Govinda Avasarala, “Liquid Markets: Assessing the Case for U.S. Exports of Liquefied Natural Gas,” Brookings Institution, May 2, 2012, http://www.brookings.edu/research/reports/2012/05/02-lng-exports-ebinger ; Center for Strategic and International Studies, “Expanding U.S. Trade Markets: Exploring Liquefied Natural Gas Exports,” July 10, 2013, http://csis.org/event/expanding-us-trade-marketsexploring-liquefied-natural-gas-exports 18 Office of the United States Trade Representative, “FACT SHEET: The United States in the Trans-Pacific Partnership: Increasing American Exports, Supporting American Jobs,” June 2012, http://www.ustr.gov/about-us/press-office/fact-sheets/2012/june/us-tppincreasing-american-exports-supporting-american-jobs 19 U.S. Energy Information Administration, “Country Analysis: Japan,” http://www.eia.gov/countries/cab.cfm?fips=JA 20 Elizabeth Rosenberg, “Energy Rush: Shale Production and U.S. National Security,” Center for a New American Security, February 2014, 5-7, http://www.cnas.org/sites/ default/files/publications-pdf/CNAS_EnergyBoom_Rosenberg_0.pdf 21 U.S. Energy Information Administration, “Country Analysis: Japan,” 22 U.S. Energy Information Administration, “Technically Recoverable Shale Oil and Shale Gas Resources: An Assessment of 137 Shale Formations in 41 Countries Outside the United States,” June 13, 2013, 10, http://www.eia.gov/analysis/studies/worldshalegas/ pdf/fullreport.pdf?zscb=50084186 23 U.S. Energy Information Administration, “Country Analysis: Japan.”

24 Ibid.; Rosenberg, 5-7.

25 Shibata Akio, “Japanese Energy Strategy in the Shale-Gas Era,” Nippon, LNG Imports in the Wake of Fukushima, http://www.nippon.com/en/in-depth/a01602/ 26 Peter Maldonado, interview by authors, Taylor-DeJongh Consulting Agency, Washington, D.C., April 3, 2014.

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27

Lydia DePillis, “Everything You Need to Know about the Trans Pacific Partnership,” Washington Post, December 11, 2013, http://www.washingtonpost.com/blogs/wonkblog/ wp/2013/12/11/everything-you-need-to-know-about-the-trans-pacific-partnership/

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The Slaughter: Mass Killings, Organ Harvestings, and China’s Secret Solution to Its Dissident Problem

by Ethan Gutmann A Review by Thomas Nelson Thomas Nelson is a writer based in Washington, D.C., and the editor of the Uyghur Update newsletter.

Little has been written on the alleged organ harvesting of Falun Gong practitioners, but the few studies that do exist are visceral, horrifying and intriguing, all at the same time. In his book The Slaughter, Ethan Gutmann builds on the existing research of the Matas-Kilgour report to determine if, and at what scale, organs are being illegally harvested from Falun Gong members.

Because of the lack of evidence, no serious academic study has been carried out. The few resources available include Gutmann’s book and a 2006 report from David Matas and David Kilgour, two Canadian human rights researchers who conducted the original investigation into organ harvesting.1 Though he was not involved with the Matas-Kilgour report, Gutmann frequently references the text, particularly in the book’s appendix where he delves into his methodology.

Facing these challenges, Gutmann pieces together a case using interviews with survivors and refugees, as well as what little information has been reported by Chinese media. There is no literature to review, no theories that he can test, no data to analyze. Gutmann’s book is, quite simply, an extended report on the harvesting of organs that he and many others believe to be happening in China. However, the in-depth nature of his interviews and his strong understanding of the history of the Falun Gong movement and its practitioners allow The Slaughter to transcend being a mere report.

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THE SLAUGHTER The book reads almost as a fiction novel, the opening chapter giving it the feeling of a macabre murder mystery. Main and supporting characters are introduced throughout, with their timelines weaving together from time to time as some activists serve coinciding prison terms in the same jails. As its name implies, however, The Slaughter is not for the squeamish. In fact, the story is so appalling and the writing so compelling that the reader would much rather believe that it actually is fiction.

Despite Gutmann’s masterful presentation, he wrote The Slaughter with a mission. In order to prove the government-sanctioned organ harvesting of Falun Gong political prisoners, both Gutmann’s book and the KiglourMatas report rely on the same methodology. Their evidence is compiled using a combination of interviews with former prisoners of Chinese detention centers, calls to hospitals across China to inquire about the availability of organs for transplant, and basic arithmetic involving prison statistics, Falun Gong practitioner estimates and official organ transplant records. The closest thing to a smoking gun is the multiple instances of Chinese doctors claiming that their organs come from Falun Gong practitioners.

However, transplant doctors may have a couple reasons to claim Falun Gong practitioners as the origin of their organs, perhaps falsely. First, Falun Gong practitioners neither smoke nor drink, and are known for being extremely healthy. An organ coming from a healthy individual is much more desirable, and if the doctor could convince patients that his or her source is healthy, they are more likely to decide on the transplant.

Second, the Chinese government has carried out a campaign to convince the general public that Falun Gong is a cult and its practitioners a menace to society. The average Chinese citizen may not feel guilty about taking organs from these dangerous individuals, especially when the organ is going to make a “good” citizen healthy again. It is important to keep in mind that the organ transplant business in China is highly lucrative, and financial incentives could also lead doctors to lie.

The simplest but least rigorous evidence that both The Slaughter and the Kilgour-Matas report presents boils down to basic arithmetic. Chinese 122 INTERNATIONAL AFFAIRS REVIEW

THOMAS NELSON sources indicate that roughly 60,000 organ transplants occurred in the country between 2000 and 2005, the most intense period of Falun Gong persecution and imprisonment. Using trends from previous years, Kilgour and Matas estimate that approximately 18,500 transplants occurred from legitimate sources – family members, brain-dead donors, etc. This leaves another 41,500 organ transplants unaccounted -- a discrepancy left unexplained by the Chinese government. Kilgour, Matas and Gutmann all assert that through simple deduction, the organs must be coming from political prisoners, and in particular, Falun Gong practitioners.

Conducting research about dissidents and oppressed minorities in China is highly challenging, because it is a living issue and highly sensitive for the Chinese government. Efforts to conduct in-country research are highly restricted, if allowed at all. Interviews with refugees are also difficult, as only a few are able to leave China and many are still under the surveillance of Chinese officials in their new homes. Their political activity, though sanctioned and legal wherever they may currently live, can have repercussions on their families and loved ones back in China. It becomes even more challenging to report the truth for an illegal activity such as organ harvesting, as the Chinese government reportedly goes to great lengths to ensure that its tracks are covered and there is as little evidence as possible.

Thus, another challenge to both Gutmann’s book and the Kigour-Matas report is the interview process. As stated above, they are limited as to whom they can speak with about the matter in China, and thus many of their interviews occur with refugees in countries such as Canada or Thailand. These interviewees are people who left China because of their political views, many of whom were detained and tortured. They, perhaps justifiably, hold grudges against the Chinese government and would not say anything to paint it in a favorable light. As a reader, however, it is challenging to feel indifferent when the survivors of China’s black prison tell the stories of their detainment. Their descriptions of the torture and humiliation they underwent are vivid, and throughout the book I found it difficult to maintain a scientific separation from the events and experiences they described.

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THE SLAUGHTER Despite these challenges, I finished the book convinced that these atrocities are being carried out. Gutmann’s logic, though simple, is difficult to rebut without alternative explanations for conflicting numbers of organ transplants. As someone unfamiliar with the Falun Gong movement and its history, I also found The Slaughter to be an unbiased introduction to the spiritual discipline. Though Gutmann makes no obvious efforts to endorse the Falun Gong movement, I finished feeling sympathetic to its practitioners.

In this modern age, information about atrocities and violations of human rights is readily available. Videos, photos, audio and first-hand accounts can be and are disseminated globally. That makes Falun Gong organ harvesting an anomaly, a quiet crisis with no definitive evidence. Can it take its place among the other human rights crises of the day, including refugee camps, mass censorship, and persecution? This year, there is a bill -- House Resolution 281 -- that is being introduced in the U.S. Congress that would condemn China’s practice of forced organ harvesting. In 2008, Kilgour and Matas testified for the United Nations about their research.

But can states and organizations take legal action against the People’s Republic of China on less-than-certain evidence?

It is an unverifiable tragedy, and one that will not receive attention until the Chinese government destroys the barriers to information it has constructed which, barring major shifts in Chinese government policy, is unlikely to happen in the foreseeable future. I would recommend this book to anyone with an interest in human rights, particularly in China. Many tragedies can be found today in news headlines, but organ harvesting of Falun Gong practitioners is one that I fear will be relegated to the history books. My hope is that The Slaughter will draw attention to the issue, and in turn put pressure on China to change their treatment of prisoners of conscience.

Gutmann, Ethan, The Slaughter: Mass Killings, Organ Harvestings, and China’s Secret Solution to Its Dissident Problem. Amherst, New York: Prometheus Books, 2014.

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David Matas and David Kilgour, “Report Into Allegations of Organ Harvesting of Falun Gong Practitioners in China,” Coalition to Investigate the Persecution of Falun Gong in China, 2006, http://www.david-kilgour.com/2006/Kilgour-Matas-organ-harvesting-rptJuly6-eng.pdf

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THE OUTBREAK OF THE FIRST WORLD WAR

The Outbreak of the First World War: Structure, Politics and Decision-Making Edited by Jack S. Levy and John A. Vasquez A Review by Bruno Binetti Bruno Binetti is a Master’s candidate in International Affairs at the Elliott School of International Affairs at The George Washington University. He holds a B.A. in International Studies from Torcuato Di Tella University in Buenos Aires, Argentina. He focuses on conflict resolution, Latin American affairs, and history of International Relations.

This year marks the 100th anniversary of the beginning of World War I, the first military confrontation that affected nearly every corner of the globe. The Great War was great not just because of its geographical reach, but also due to the unprecedented loss of life it caused, and the structural transformations of the international system that followed it. Indeed, as European armies marched to war in August 1914, they were leading the way toward what British historian Eric Hobsbawn coined “the short twentieth century,” that would end with the fall of the Berlin Wall in 1989.

This centennial has generated renewed academic interest on the conflict, which has led to the publication of new books and the reediting of classics.

In this crowded field, The Outbreak of the First World War stands out for bringing together a distinguished group of historians and political scientists to explain the origins of the war in 1914. This interdisciplinary effort, coordinated by editors Jack Levy and John Vasquez, reflects on the historical importance of World War I and highlights the fact that it was the cradle for most of the current theories of international relations.

The sequence of events that led to World War I is widely known. The murder of the heir to the Austrian-Hungarian throne in Bosnia led to an Austrian ultimatum to Serbia. Russia responded with a full mobilization, followed by that of its ally, France, after which Austrian ally Germany declared war on both. This occurred in a context of great power rivalry, arms races, and fixed alliances that had been developing for decades, 126 INTERNATIONAL AFFAIRS REVIEW

BRUNO BINETTI which made conflict almost inevitable after the mechanisms of mutual reassurances and guarantees were set in motion. During these decisive days, governments from all major European powers exchanged telegrams, visits, and informal messages, as they mulled their reactions to each other´s threats and military movements.

The Outbreak of the First World War effectively uses historical documents to sustain different perspectives about what drove Europe and the world to this conflict. Telegrams, newspapers, and official reports are analyzed in depth by all authors in search for the deep reasons and perceptions behind every major power decision. Diplomatic positions and military orders usually changed on a daily basis before the beginning of the war, which makes these efforts even more noteworthy.

The main theme of this book is what Samuel Williamson calls in his chapter the “German paradigm”: the prevalent perspective that Germany was the main (and for some authors almost sole) instigator of the war. This view states that the war was a direct consequence of German fears about its relative decline, combined with the opportunity presented by the events in Sarajevo. Dale Copeland’s chapter explains the origin of the war in terms that are absolutely in line with this vision. In recent times, however, this view has been challenged by alternative explanations that do not ignore the role of Berlin, but consider it to be just one of many factors leading to war. The nature of this debate is very relevant, as by many accounts, the massive war reparations that the Treaty of Versailles imposed on a defeated Germany because of its alleged responsibility in initiating the war originated a profound resentment among the German people that would subsequently lead to Nazism and a second global war just twenty years later.

In that regard, one of the strongest qualities of this text is that it brings new perspectives to the debate without seeking to impose a definite conclusion regarding German responsibility. Historical analysis usually suffers from bias, as authors seek to sustain their own views rather than search for new knowledge. This is not the case in The Outbreak, and the lack of homogeneity provides a diversity of opinion that contributes to the 127 VOLUME XXIII, NUMBER 1 · FALL 2014

THE OUTBREAK OF THE FIRST WORLD WAR explanatory power of the book as a whole. The chapters by Mulligan, Levy, and Vasquez all confront the German paradigm from different points of view, seeking to explain whether Germany intended to launch a preventive war in 1914 or not. For all explanations of the origin of the conflict, and especially for those that subscribe to the German paradigm, the prognoses in Berlin about the nation’s future and its relative decline in the face of a rising Russia are critical. Many authors claim that decisionmakers in Germany, including the Kaiser and the chancellor, believed that the crisis that erupted in 1914 gave them the best opportunity to confront Russia before its power capabilities became far greater than those of Germany itself. Of course, this vision of a strong Russia would eventually fall, along with the Romanov Dynasty, in 1917.

Nevertheless, this book goes beyond the debate about Germany’s responsibility. Karen Rasler and William Thompson study the interconnection of the multiple rivalries between European powers as a key factor for the outbreak of the war. Ronald Bobroff and J. F. V. Keiger analyze the domestic situations and interests of Russia and France, respectively, from a point of view that is not far from the German paradigm previously described; both countries are portrayed as reluctantly drawn into a war they did not choose. Although briefly mentioned in several chapters as an important aspect in the calculations of other great powers in 1914, none of the contributors directly address the role of Great Britain in the beginning of the war. Future works on this matter should explore the reasons why London decided to unequivocally back Paris and Saint Petersburg in the July crisis, a position that became clear to Germany in the days prior to the war. It is likely that this support from Great Britain played an important role in French and Russian decisions to mobilize their troops as tensions rose. Moreover, Great Britain joined the war as the primus inter pares among the European world powers, a position that makes its reasons to enter the war all the more important.

The depth and academic rigor of the Outbreak of the First World War makes it an indispensable book not only to comprehend the origins of World War I, but also to bring the lessons of this conflict to the twentyfirst century. Ultimately, to study the outbreak of World War I is to 128 INTERNATIONAL AFFAIRS REVIEW

BRUNO BINETTI analyze the interaction between the structure of the international system and the impact of human agency. Powerful men and women immersed in an international context make decisions based on their personalities and perceptions; this is the core of international relations. Timeless lessons can be drawn and applied by modern-day scholars from the factors that influenced European major powers in 1914. In particular, as American power in the international system continues to be challenged by emerging states such as China and Russia, debates about balance of power in a multipolar world, relative decline and even preventive war will become increasingly frequent and relevant. It will be crucial for decision makers to understand that rigid positions, armed standoffs, and geopolitical confrontation can be extremely dangerous in a context of uncertainty, and elude their control. In that sense, the outbreak of World War I is the story of an unintended tragedy into which nations entered at full speed. To prevent history from repeating itself, it is crucial to remember what happened in 1914 during the weeks that forever changed the world.

Jack S. Levy and John A. Vasquez, eds. The Outbreak of the First World War: Structure, Politics, and Decision-making. Cambridge: Cambridge University Press, 2014.

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