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Archive for the ‘United Nations’ Category

When writing about the statist agenda of international bureaucracies, I generally focus my attention on the International Monetary Fund and the Organization for Economic Cooperation and Development.

Today, let’s give some attention to the United Nations.

Based on this story from the Washington Post, the bureaucrats at the UN have concluded that America is a miserable and awful nation.

…a new United Nations report that examines entrenched poverty in the United States…calls the number of children living in poverty “shockingly high.” …the report, written by U.N. special rapporteur on extreme poverty and human rights Philip Alston, says the United States tops the developed world with the highest rates of youth poverty… The results of the report are not out of line with a number of others…in recent years by different organizations in which the United States has turned up at or near the top on issues such as poverty rates.

But I’ve learned from personal experience (see here and here) that the United Nations is guided by statist ideology and I should be extremely skeptical of any of its findings.

For instance, when it intervenes in policy (global warming and gun control, for instance, as well as the Internet, the War on Drugs, monetary policy, and taxpayer-financed birth control), the UN inevitably urges more power and control for government.

So let’s take a jaundiced look at some of the assertions in this new report, starting with that dramatic claim of record child poverty in America.

The United States…has the highest youth poverty rate in the Organization for Economic Cooperation and Development (OECD)… The consequences of neglecting poverty… The United States has one of the highest poverty…levels among the OECD countries… the shockingly high number of children living in poverty in the United States demands urgent attention. …About 20 per cent of children live in relative income poverty, compared to the OECD average of 13 per cent.

So is it true that poverty is very high in the USA and is it also true that America has the highest rate of child poverty of all OECD countries? Even higher than Mexico, Greece, and Turkey? And what is the source of this remarkable assertion?

If you look at footnote #51, you’ll see reference to an OECD publication that contains this supposedly damning chart.

But if you look at the fine print at the bottom, you’ll discover that the chart on child poverty doesn’t actually measure child poverty. Instead, the bureaucrats at the OECD have put together a measure of income distribution and decided that “relative poverty” exists for anyone who has less than 50 percent of the median level of disposable income.

In other words, the United States looks bad only because median income is very high compared to other nations.

Which is the same dishonest data manipulation that the OECD uses when exaggerating America’s overall poverty rate (other groups that have used this deliberately dishonest methodology include the Equal Welfare Association, Germany’s Institute of Labor Economics, and the Obama Administration).

The bottom line is that the key finding of the UN report is based on a bald-faced lie.

By the way, I’m not surprised to see that the UN report also cites the IMF to justify statist policies.

In a 2017 report, the International Monetary Fund (IMF) captured the situation…, stating that the United States economy “is delivering better living standards for only the few”, and that “household incomes are stagnating for a large share of the population, job opportunities are deteriorating, prospects for upward mobility are waning, and economic gains are increasingly accruing to those that are already wealthy” …A much-cited IMF paper concluded that redistribution could be good for growth, stating: “The combined direct and indirect effects of redistribution — including the growth effects of the resulting lower inequality — are on average pro-growth.”

For what it’s worth, the IMF’s research on growth and inequality is embarrassingly bad.

Here’s another big takeaway from the UN report.

The United States…has the highest…infant mortality rates among comparable OECD States. …The infant mortality rate, at 5.8 deaths per 1,000 live births, is almost 50 per cent higher than the OECD average of 3.9.

I’m not an expert on infant mortality. Indeed, I’ve never looked at infant mortality data. But given the UN’s reliance on dodgy and dishonest numbers in other areas, I’m skeptical whether these numbers are true.

And, according to Johan Norberg, the numbers about high levels of infant mortality in the United States are false.

The UN report contains many other ideologically motivated attacks on the United States.

For instance, America is a bad country because taxes supposedly are too low.

The United States has the highest rate of income inequality among Western countries. The $1.5 trillion in tax cuts in December 2017 overwhelmingly benefited the wealthy and worsened inequality. …The tax cuts will fuel a global race to the bottom, thus further reducing the revenues needed by Governments to ensure basic social protection and meet their human rights obligations. …There is a real need for the realization to sink in among the majority of the American population that taxes are not only in their interest, but also perfectly reconcilable with a growth agenda.

While the above passage is remarkable for the level of economic illiteracy, I confess that I chortled with glee when I read the part about how the recent tax reform “will fuel a global race to the bottom.”

As I wrote last year and this year, the fact that other governments will face pressure to reduce tax rates is something to celebrate.

Here’s one final excerpt. The UN report also bashes the United States because we don’t view dependency as a human right.

Successive administrations, including the current one, have determinedly rejected the idea that economic and social rights are full-fledged human rights, despite their clear recognition not only in key treaties that the United States has ratified… But denial does not eliminate responsibility, nor does it negate obligations. International human rights law recognizes a right to education, a right to health care, a right to social protection for those in need and a right to an adequate standard of living.

Needless to say, a problem with this vision of “positive rights” is that it assumes there will always be a supply of chumps willing to work hard so the government can tax away their money to finance all the goodies. But Greece shows us that it’s just a matter of time before that games ends with disaster.

In other words, Thomas Sowell is right and Franklin Roosevelt was wrong.

Let’s close with some good news. As the Washington Post just reported, the UN’s dishonest anti-American screed apparently will prove costly to that bloated bureaucracy.

Alston arrived in Washington last fall on a mission from the U.N. Human Rights Council to document poverty in America. …he was told by a senior State Department official that his findings may influence the United States’ membership in the human rights body. …“I think I was being sent a message.” Two other people at the meeting, speaking on the condition of anonymity, confirmed Alston’s account. …Nikki Haley announced this week that the United States would withdraw from the Human Rights Council.

Good for Ambassador Haley.

Her actions stand in stark contrast to some of her predecessors, who apparently believed in taxpayer-financed self-flagellation.

Alston said he was initially invited by the U.S. government under President Barack Obama to study poverty in America. The invitation was extended again by U.S. officials under then-Secretary of State Rex Tillerson in 2017, he said. “We look forward to welcoming Mr. Alston to the United States for a country visit this December,” Flacelia Celsula, part of the U.S. delegation at the United Nations, said in a meeting of the Human Rights Council on June 8, 2017.

It goes without saying that Mr. Alston should have the freedom write leftist reports. He also should have the freedom to spread lies in those reports. But I don’t want American tax dollars to finance his ideological bilge.

Which brings us to the obvious takeaway. As seems to be the case with all international bureaucracies, the United Nations wastes money at a prodigious pace. With any luck, Alston’s nonsense will convince American policymakers that deep budget cuts for the UN are long overdue.

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I don’t think I’m a glass-half-empty kind of person, but I realized that I have a habit of sharing “depressing” charts.

Well, as the Monty Python folks advised, it’s time to look on the bright side of life.

So here’s the most enjoyable chart of 2018, courtesy of the Washington Post.

By the way, it’s not “enjoyable” because it shows more gun ownership.

Yes, I believe in private gun ownership, because I respect the Constitution, because I want to discourage crime, because I support liberty, and because I believe in the right of self-defense in case society goes off the rails. But those reasons don’t bring a smile to my face.

The reason the chart is so enjoyable is that it nicely captures Obama’s total failure to impose gun control. Heck, he didn’t just fail to change policy, he actually wound up being the best thing that ever happened to gun manufacturers. And I confess that makes me feel warm and fuzzy.

But let’s set that aside and actually take a closer look at gun ownership numbers. The data in the chart come from a global survey. Here’s some of the coverage of those numbers from the Associated Press.

The Small Arms Survey says 393 million of the civilian-held firearms, 46 percent, are in the United States, which is “more than those held by civilians in the other top 25 countries combined.” …the report’s author, Aaron Karp, said at a news conference. “American civilians buy an average of 14 million new firearms every year, and that means the United States is an overwhelming presence on civilian markets.” …The estimate of over 1 billion firearms worldwide at the end of 2017 also includes 133 million such weapons held by government military forces and 22.7 million by law enforcement agencies, it said. …The Small Arms Survey released its study to coincide with the third U.N. conference to assess progress on implementing a 2001 program known as Prevent, Combat and Eradicate the Illicit Trade in Small Arms… According to the report, the countries with the largest estimated number of civilian-held legal and illegal firearms at the end of 2017 were the United States with 393.3 million, India with 71.1 million, China with 49.7 million, Pakistan with 43.9 million and Russia with 17.6 million. …Americans, who own 121 firearms for every 100 residents. They are followed by Yemenis at 53, Montenegro and Serbia with 39, Canada and Uruguay about 35, and Finland, Lebanon and Iceland around 32.

Given America’s status, I’m tempted to start chanting “USA, USA, USA,” but there are some very important factoids buried in the AP report.

Anna Alvazzi del Frate, the institute’s program director, said that “the countries with the highest level of firearm violence — they don’t rank high in terms of ownership per person.” “So what we see is that there is no direct correlation at the global level between firearm ownership and violence,” she said.

Wow, that’s a remarkable admission. It turns out that more guns don’t lead to more crime. But we already knew that.

Now let’s look at some excerpts from the aforementioned story about the same report from the Washington Post.

There are more than 393 million civilian-owned firearms in the United States, or enough for every man, woman and child to own one and still have 67 million guns left over. Those numbers come from the latest edition of the global Small Arms Survey… The report, which draws on official data, survey data and other measures for 230 countries, finds that global firearm ownership is heavily concentrated in the United States. In 2017, for instance, Americans made up 4 percent of the world’s population but owned about 46 percent of the entire global stock of 857 million civilian firearms. …the United States stands out among the world’s wealthiest nations, with an ownership rate more than three times higher than the rate in the next-highest country, Canada. …Measured in rates or in raw terms, the United States is the civilian gun capital of the world.

Since I already shared the chart about the U.S. having more guns than people, here’s another chart from the story showing how Americans are far better armed than their counterparts in other advanced countries.

I’m surprised Switzerland isn’t in second place, but I’m glad to see good numbers from the Nordic nations (Bernie Sanders may have to reconsider his affection for those countries).

P.S. Thinking about whether to create a collection of “enjoyable charts,” the obvious choice would be the one from 2014 that showed how effectively the Tea Party-influenced GOP stymied Obama’s spending plans (that was back when Republicans were in favor of smaller government, unlike 2018).

P.P.S. The AP story mentioned that the United Nations has a pact to restrict private gun ownership. I explained in 2013 why that’s an awful scheme. The good news is that Trump’s new National Security Adviser is very solid on that issue.

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I expressed approval when Trump proposed to reduce U.S. funding for international bureaucracies, mostly because of my disdain for the statist policy agenda of the International Monetary Fund and Organization for Economic Cooperation and Development.

Sadly, there’s has not been much follow-through by the White House, and it looks like Congress isn’t going to cut either the funding or the authority of these bloated institutions. And that means they will continue to advocate for class-warfare tax policy and bigger government.

But, as reported by AFP, some seeds were planted early in the year that may eventually save money for taxpayers.

…a draft executive order…prepared at the White House could deprive the United Nations of billions of dollars in US financial support. The United States is by far the UN’s biggest financial contributor, providing 22 percent of its operating budget and funding 28 percent of peacekeeping missions, which currently cost $7.8 billion annually. …The Trump administration is proposing a 40 percent cut in some US funding, according to the draft executive order titled “Auditing and Reducing US Funding of International Organizations.”

And it appears that some of the seeds germinated. According to the Associated Press, steps are being taken to reduce the fiscal burden of the United Nations.

The U.S. government says it has negotiated a significant cut in the United Nations budget. The U.S. Mission to the United Nations said on Sunday that the U.N.’s 2018-2019 budget would be slashed by over $285 million. The mission said reductions would also be made to the U.N.’s management and support functions. The announcement didn’t make clear the entire amount of the budget or specify what effect the cut would have on the U.S. contribution. U.S. ambassador to the U.N. Nikki Haley said that the “inefficiency and overspending” of the organization is well-known, and she would not let “the generosity of the American people be taken advantage of.”

By the way, “nicked” or “trimmed” would be more accurate than “slashed.”

Nonetheless, at least it’s a small step in the right direction.

And the recent U.N. vote against the U.S. may lead to additional budgetary savings, as explained in the Wall Street Journal by John Bolton, a former ambassador from the United States to that bureaucracy.

…the U.N. showed its true colors with a 128-9 vote condemning President Trump’s recognition of Jerusalem as Israel’s capital. …America is heard much more clearly at the U.N. when it puts its money where its mouth is. …the White House should also reconsider how Washington funds the U.N. more broadly. …Despite decades of U.N. “reform” efforts, little or nothing in its culture or effectiveness has changed. …Turtle Bay has been impervious to reform largely because most U.N. budgets are financed through effectively mandatory contributions. Under this system, calculated by a “capacity to pay” formula, each U.N. member is assigned a fixed percentage of each agency’s budget to contribute. The highest assessment is 22%, paid by the U.S. This far exceeds other major economies… The U.S. should reject this international taxation regime and move instead to voluntary contributions. This means paying only for what the country wants—and expecting to get what it pays for. Agencies failing to deliver will see their budgets cut, modestly or substantially. Perhaps America will depart some organizations entirely.

Bolton has some targets in mind.

…earlier this year the U.N. dispatched a special rapporteur to investigate poverty in the U.S.? American taxpayers effectively paid a progressive professor to lecture them about how evil their country is. The U.N.’s five regional economic and social councils, which have no concrete accomplishments, don’t deserve American funding either. …Next come vast swaths of U.N. bureaucracy. Most of these budgets could be slashed with little or no real-world impact. Start with the Office for Disarmament Affairs. The U.N. Development Program is another example. Significant savings could be realized by reducing other U.N. offices that are little more than self-licking ice cream cones, including many dealing with “Palestinian” questions. …Thus could Mr. Trump revolutionize the U.N. system. The swamp in Turtle Bay might be drained much more quickly than the one in Washington.

And Rich Lowry of National Review didn’t even wait for the latest controversy.

Here are some excerpts from a column he wrote in late 2016.

We are the chief funder of a swollen, unaccountable U.N. apparatus that has been a gross disappointment for more than 70 years now. …As early as 1947, a U.S. Senate committee flagged “serious problems of overlap, duplication of effort, weak coordination, proliferating mandates and programs, and overly generous compensation of staff within the infant, but rapidly growing, UN system.” And those were the early, lean years. We pay more than anyone else to keep the U.N. in business, about 22 percent of the U.N.’s regular budget. …Because nothing involving the U.N. is clean or straightforward, it’s hard to even know how much the U.S. pays in total into the U.N. system. But it’s probably around $8 billion a year. We should withhold some significant portion of it.

My view, for what it’s worth, is that the United Nations is better (less worse?) than the OECD or IMF.

But that’s mostly because it doesn’t have much power. When it does try to intervene in policy (global warming and gun control, for instance, as well as the Internet, the War on Drugs, monetary policy, and taxpayer-financed birth control), the U.N. inevitably urges more power and control for government.

If you think I’m exaggerating about a statist mindset at the United Nations, check out this jaw-dropping tweet from a high-level bureaucrat.

Wow. Before capitalism, as explained in videos by Deirdre McCloskey and Don Boudreaux, human existence was characterized by grinding poverty. But once free markets were unleashed, the world has enjoyed unprecedented prosperity.

Yet this liberating and enriching system is “an urgent threat” according to the United Nations.

Wouldn’t it be more appropriate if the bureaucrat who sent out this tweet instead focused on hellholes where the free market is suppressed and persecuted – such as Venezuela, North Korea, Zimbabwe, and Cuba?

My friend Walter Williams perhaps has the best response to the U.N.’s vapid sentiment (h/t: libertarian Reddit).

Others share my concern, as illustrated by this passage from a column in the U.K.-based Daily Telegraph.

Hillel Neuer, the head of UN Watch, a campaign group, called this a “loony tweet”, adding: “While millions of people are suffering from genocide, sexual slavery and starvation, it is far from clear why the UN would instead focus its attention on unidentifiable ‘urgent threats’, let alone on economic subjects about which it has neither competence nor expertise.” Mr Neuer pointed out that socialist economics had brought misery to Venezuela without drawing similar criticism from the UN. “The same UN human rights office has failed to issue a single tweet about this past month’s dire human rights crisis in Venezuela, where millions face mass hunger in part due to attacks on the free market,” he said.

Let’s look at other examples of U.N. statism.

For example, the bureaucrats are inserting themselves in American racial issues.

The history of slavery in the United States justifies reparations for African Americans, argues a recent report by a U.N.-affiliated group based in Geneva. …The group of experts, which includes leading human rights lawyers from around the world, presented its findings to the United Nations Human Rights Council on Monday, pointing to the continuing link between present injustices and the dark chapters of American history. “In particular, the legacy of colonial history, enslavement, racial subordination and segregation, racial terrorism and racial inequality in the United States remains a serious challenge, as there has been no real commitment to reparations and to truth and reconciliation for people of African descent,” the report stated. …The reparations could come in a variety of forms, according to the panel, including “a formal apology, health initiatives, educational opportunities … psychological rehabilitation, technology transfer and financial support, and debt cancellation.”

By the way, I’m fine with a formal apology (assuming one hasn’t already been issued). Slavery is a stain on American history, after all.

And I’d be delighted to see a massive school choice initiative, which would benefit students from all backgrounds, but I strongly suspect black kids would disproportionately gain.

I fear, though, that the U.N. panel is primarily interested in “financial support,” which is simply a euphemism for a bigger welfare state. And since the current welfare state already has caused great damage to the black community, making it even bigger would be very ill-advised.

Here’s another example of bizarre policy from a division of the United Nations. The bureaucrats at the World Health Organization want to classify the absence of a sexual partner as a disability.

…the World Health Organisation will change the standard to suggest that a person who is unable to find a suitable sexual partner or is lacking a sexual relationship to have children – will now be equally classified as disabled. WHO says the change will give every individual “the right to reproduce”. …Gareth Johnson MP, former chair of the All Parliamentary Group on Infertility, whose own children were born thanks to fertility treatment, said: “I’m in general a supporter of IVF. But I’ve never regarded infertility as a disability or a disease but rather a medical matter. …Dr David Adamson, an author of the new standards, argued…”It puts a stake in the ground and says an individual’s got a right to reproduce whether or not they have a partner. It’s a big change. …It sets an international legal standard. Countries are bound by it.”

Hey, I’m had many tragic periods of celibacy in my life and I never even got a handicapped parking sticker!

More seriously, I have great sympathy for people with fertility issues. Not only because I have empathy for them, but also because of my concerns about demographic decline.

But there’s a big difference between saying that people have a right to try to have children and the U.N.’s assertion that others are obliged to help people have children.

It doesn’t help that the U.N. newest top bureaucrat has a very dismal track record.

Here are some of the grim details from Claudia Rosett.

…former Prime Minister of Portugal Antonio Guterres…brings to the job a record that suggests he is a perfect fit to head a UN that is prone to overreach, mismanagement, waste, fraud, abuse and government meddling in every aspect of life — provided we all want even more of the same. …Guterres also served as president of the Socialist International, from 1999-2005… From 2005-2015, Guterres served as high commissioner of the UN agency for refugees (UNHCR)… That sounds great, except the UN’s own auditors…issued an audit report identifying a series of “critical” lapses by the UNHCR under Guterres’s management. …If that’s how Guterres managed — or mismanaged — a single UN agency while running it for more than a decade, is it likely he will do a better job as secretary-general? …we get a longtime socialist with a record of managerial incompetence, heading a multi-billion dollar, diplomatically immune, opaque, globe-girdling organization funded with billions of other people’s money (America, which bankrolls roughly one-quarter of the UN system with your tax dollars, being the largest contributor). What could go wrong?

The answer to Claudia’s question is that we’ll probably get business as usual.

And since that means more waste and more advocacy of bad policy, that’s unfortunate news for taxpayers all over the world.

So I’m keeping my fingers crossed that the Trump Administration does the right thing and puts the U.N. on a diet.

Let’s close with some humor. Here’s a Jeff MacNelly cartoon, presumably from way back in the 1970s.

P.S. In my experience, many U.N. officials and bureaucrats are smart, well-meaning people. But as I noted during a trip to Switzerland back in 2009, it would be much better if they were in the private sector where their skills and abilities could be used for expanding prosperity.

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The United Nations has proposed a set of “sustainable development goals.” Most of them seem unobjectionable. After all, presumably everyone wants things such as less poverty, a cleaner environment, better education, and more growth, right?

That being said, I’m instinctively skeptical about the goal of “climate action” because of the U.N.’s past support for statist policies in that area.

And I also wonder why the bureaucrats picked “reduced inequalities” when “upward mobility for the poor” is a much better goal.

While I am tempted to nit-pick about some of the other goals as well, I’m actually more worried about how the U.N. thinks the goals should be achieved.

I participated in a U.N. conference in early April and almost every bureaucrat and government representative asserted that higher tax burdens were necessary to achieve the goals. It truly was a triumph of ideology over evidence.

And some of the cheerleaders for this initiative have a very extreme view on these issues. Consider a new report, issued by Germany’s Bertelsmann Stiftung and the U.N.’s Sustainable Development Solutions Network, that ranks nations based on how successful they are at achieving the sustainable development goals. Jeffrey Sachs was the lead author, so perhaps we shouldn’t be too surprised to discover that there are some very odd results.

Bernie Sanders will be naively happy since the Nordic nations dominate the top of the rankings. The United States is #42, by contrast, sandwiched between Argentina and Armenia. Moreover, the United States is behind countries such as Hungary, Belarus, Portugal, Moldova, Greece, and Ukraine, which seems strange because Americans enjoy significantly higher levels of consumption – even when compared to other rich jurisdictions.

But the most absurd feature – at least for anyone with the slightest familiarity with international economic data – is that Cuba (circled in green) is ranked considerably above the United States (circled in red).

This is a jaw-droppingly stupid assertion. Cuba is a staggeringly impoverished nation thanks to an oppressive communist dictatorship.

So how can Sachs and his colleagues produce a report putting that country well above a rich nation like the United States?

Let’s look at some of the data. Here’s the summary of Cuba from the report. Pay particular attention to the circle on the right. If the blue bars extend to the outer edge, that means the country supposedly is doing a very good job achieving a goal, whereas a small blue bar indicates poor performance.

And here is the same information for the United States.

It appears that Cuba does much better for poverty (#1), responsible consumption (#12), climate action (#13), life on land (#15), and partnership (#17), while the United States while the United State does much better for industry, innovation, and infrastructure (#9).

But here’s an easier and more precise way of comparing the two nations. All you need to know is that green is the best, yellow is second best, followed by burnt orange, and red is the worst.

Cuba wins in nine categories and the United States is ranked higher in three categories.

Now here’s why most of these rankings are total nonsense. If you go to page 51 of the report, you’ll see the actual variables that are used to produce the scores for the 17 U.N. goals.

And what do you find? Well, here are some things that caught my eye.

  • For the first goal of “no poverty,” the report includes a measure of income distribution rather than poverty. This is same dodgy approach that’s been used by the Obama Administration and the OECD, and because almost everyone is Cuba is equally poor, that means it scores much higher than the United States, where everyone is richer, but with varying degrees of wealth. I’m not joking.
  • For the second goal of “zero hunger,” I can’t figure out how they concocted a higher score for Cuba. After all, there’s pervasive food rationing in that hellhole of an island. My best guess is that the United States gets downgraded because the category includes an obesity variable. Having a lot of overweight people may not be a good feature of America, but is it rude for me to point out that a large number of heavy people is the opposite of hunger?
  • Jumping ahead to the fifth goal of “gender equality,” I assume the United States gets a bad score because of the variable for the gender wage gap, even though women in America earn far higher incomes than their unfortunate and impoverished counterparts in Cuba.
  • Regarding the eighth goal of “decent work and economic growth,” it’s not clear how Sachs and his colleagues gave Cuba the best possible score. But I know the final result is preposterous given that the Cuban people are suffering from crippling material deprivation.
  • For the twelfth (“responsible consumption and production”) and thirteenth (“climate action”) goals, it appears that the United States gets a lower score because rich nations consume more energy than poor nations. If this is why Cuba beats the USA (just as they “scored higher” in the so-called Happy Planet Index), then I’m glad America loses that contest.
  • Last but not least, I can’t resist commenting on Cuba getting the best score and the U.S. getting worst score for “partnerships,” which is the seventeenth goal. If you read the fine print, it turns out that nations get better grades if their tax burdens are higher. And countries like the United States get downgraded because they are tax havens and/or they respect financial privacy.

The main takeaway is that Sachs and his colleagues produced a shoddy report based on statist ideology and – in many cases – on dodgy methodology.

Anyone who ranks Cuba above the United States when trying to measure quality of life should be treated like a laughingstock.

The report also ranks the ultra-rich and very successful nation of Singapore at #61, below poor countries such as Uzbekistan and Mexico. Are these people smoking crack? That’s even more absurd than the OECD’s report on Asian taxes, which basically pretended Singapore didn’t exist.

Heck the report also has dysfunctional Venezuela ahead of Panama, even though tens of thousands of Venezuelans have fled to Panama to escape their poorly governed nation. But I guess real-world evidence doesn’t matter to people trying to promote statism.

P.S. I got to tangle with Jeffrey Sachs at a United Nations conference on the state of the world economy back in 2012. Nothing has changed.

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I’ve been at the United Nations this week for both the 14th Session of the Committee of Experts on International Cooperation in Tax Matters as well as the Special Meeting of ECOSOC on International Cooperation in Tax Matters.

As you might suspect, it would be an understatement to say this puts me in the belly of the beast (for the second time!). Sort of a modern-day version of Daniel in the Lion’s Den.

These meetings are comprised of tax collectors from various nations, along with U.N. officials who – like their tax-free counterparts at other international bureaucracies – don’t have to comply with the tax laws of those countries.

In other words, there’s nobody on the side of taxpayers and the private sector (I’m merely an observer representing “civil society”).

I could share with you the details of the discussion, but 99 percent of the discussion was boring and arcane. So instead I’ll touch on two big-picture observations.

What the United Nations gets wrong: The bureaucracy assumes that higher taxes are a recipe for economic growth and development.

I’m not joking. I wrote last year about how many of the international bureaucracies are blindly asserting that higher taxes are pro-growth because government supposedly will productively “invest” any additional revenue. And this reflexive agitation for higher fiscal burdens has been very prevalent this week in New York City. It’s unclear whether participants actually believe their own rhetoric. I’ve shared with some of the folks the empirical data showing the western world became rich in the 1800s when fiscal burdens were very modest. But I’m not expecting any miraculous breakthroughs in economic understanding.

What the United Nations fails to get right: The bureaucracy does not appreciate that low rates are the best way of boosting tax compliance.

Most of the discussions focused on how tax laws, tax treaties, and tax agreements can and should be altered to extract more money from the business community. Participants occasionally groused about tax evasion, but the real focus was on ways to curtail tax avoidance. This is noteworthy because it confirms my point that the anti-tax competition work of international bureaucracies is guided by a desire to collect more revenue rather than to improve enforcement of existing law. But I raise this issue because of a sin of omission. At no point did any of the participants acknowledge that there’s a wealth of empirical evidence showing that low tax rates are the most effective way of encouraging tax compliance.

I realize that these observations are probably not a big shock. So in hopes of saying something worthwhile, I’ll close with a few additional observations

  • I had no idea that people could spend so much time discussing the technicalities of taxes on international shipping. I resisted the temptation to puncture my eardrums with an ice pick.
  • From the moment it was announced, I warned that the OECD’s project on base erosion and profit shifting (BEPS) was designed to extract more money from the business community. The meeting convinced me that my original fears were – if possible – understated.
  • A not-so-subtle undercurrent in the meeting is that governments of rich nations, when there are squabbles over who gets to pillage taxpayers, are perfectly happy to stiff-arm governments from poor nations.
  • The representative from the U.S. government never expressed any pro-taxpayer or pro-growth sentiments, but he did express some opposition to the notion that profits of multinationals could be divvied up based on the level of GDP in various nations. I hope that meant opposition to “formula apportionment.”
  • Much of the discussion revolved around the taxation of multinational companies, but I was still nonetheless surprised that there was no discussion of the U.S. position as a very attractive tax haven.
  • The left’s goal (at least for statists from the developing world) is for the United Nations to have greater power over national tax policies, which does put the UN in conflict with the OECD, which wants to turn a multilateral convention into a pseudo-International Tax Organization.

P.S. The good news is that the folks at the United Nations have not threatened to toss me in jail. That means the bureaucrats in New York City are more tolerant of dissent than the folks at the OECD.

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I’m not a fan of international bureaucracies. Simply stated, they routinely promote statism, which translates into less freedom and prosperity.

But not all international bureaucracies are created equal. Most of my ire is directed at the International Monetary Fund and the Organization for Economic Cooperation and Development for the simple reason that those two institutions actually have some ability to subsidize or coerce bad policy.

The United Nations, by contrast, is largely ineffective and corrupt (or absurd, as seen by the effort to make taxpayer-funded birth control a “human right”). So while its even more left-leaning than the IMF and OECD, it doesn’t do as much damage.

Though that may change if the UN succeeds in its multi-year plan to seize control of the Internet, something that may happen because of feckless choices by the Obama Administration (if you think his FCC scheme to turn the Internet into a public utility is misguided, you’ll love what’s now happening).

Let’s review the situation. Here’s some background information from an article by James Glassman.

…the Internet has been governed by the people who use it. In a bottom-up process remarkably free of political interference, the system brings together businesses, engineers, research institutions, civil society groups, and governments to make decisions by consensus. …this “multi-stakeholder model,” as it’s called, actually works, with real transparency and accountability. Rooted in the principles of seamless cross-border networks and freedom of expression, the Internet has been adopted faster than any other means of communication in history.

But the attitude of politicians and bureaucrats seems to be that if something works, it’s time to break it.

…the Internet’s good-governance model faces a serious threat. …the United Nations General…will consider new ways to govern the Internet, and authoritarian countries are pushing to give governments a bigger stake in decision-making. …Regimes like those in Russia, China, and Iran are themselves under serious threat, with their own Internet users criticizing government and uncovering corruption. What they want is a U.N.-style model, where every country has a vote, and those votes will boost the power of the governments casting them. One result could be a balkanized Internet where threatening speech, or commercial competition, is squelched at the border.

That’s not good news, as I can personally attest having been severely limited in my Internet access during a recent trip to China.

Surely the United States will oppose this agenda, right? That may have been true years ago, but not now.

…the United States has been a fervent supporter of the multi-stakeholder process. But last year, the Obama administration announced it would give up…now ICANN is up for grabs. It could end up being not just a manager of addresses but the main governing institution for the entire Internet.

And that means the heavy foot of government.

Consider the filing by the Group of 77 plus China — a coalition…that…says “… the overall authority for Internet related public policy issues is the sovereign right of States.” …Russia’s filing is even worse: “We consider it necessary [the document’s italics] to consecutively increase the role of governments in the Internet governance…”

The bottom line is that decisions by the Obama Administration have made it more likely that governments will compromise the efficiency and openness of the Internet.

In past meetings of this sort, the U.S. has managed to keep the authoritarians at bay, but the administration’s ICANN decision — another case of attempting to lead from behind — won’t help. ICANN is a tempting prize for China and other countries. …The real problem is that with WSIS+10, the United Nations has gained official acceptance as the arbiter of Internet governance. …the conference itself amplifies the danger of a takeover by forces that see a free Internet as an existential threat.

Glassman’s article was published in December. It’s now March.

What’s happened over the past few months?

We have a new column in the Wall Street Journal by Gordon Crovitz, and the developments have been in the wrong direction.

Two years after President Obama decided to give up U.S. protection of the open Internet, his administration is now considering how to give away power to other governments, most of which want a closed, censored Internet. …The plan was supposed to ensure that U.S. control could never be replaced “with a government-led or intergovernmental organization solution.” Yet it does precisely that, giving foreign governments new powers over the Internet Corporation for Assigned Names and Numbers, or Icann, and a path to full control. …Robin Gross…filed a dissent with Icann against upgrading the government role “from an advisory to a decisional role over Icann’s policies, operations and corporate governance matters.”

And here’s what this may mean.

The main risk of government control is to the root zone of the Internet, currently protected by the U.S. government through its contract with Icann. If authoritarian governments can get access to the underlying website names and addresses globally, they could disable sites they don’t like everywhere in the world, not just in their own countries. In secret planning discussions last year leaked to me, the Russian representative told other authoritarian governments that full government control over Internet stakeholders is a topic that “needs to be further examined” only after the U.S. withdraws, creating a vacuum of power.

So is there any way of stopping Obama from surrendering the Internet?

Crovitz explains that there is hope.

Congress has used budget bills to defund any action by the Obama administration to end the U.S. contract with Icann, at least through this September. …A new president should decide the wisdom of abandoning the Internet before it is given up with no chance of return. The Obama administration doesn’t like to acknowledge American exceptionalism, but the open Internet reflects the American values of free speech and open innovation. The Internet as we know it won’t survive if other governments get their way.

I suppose a key issue is whether Congress can extend the funding ban until next year, at which point there may (or may not!) be a President interested in protecting the Internet.

P.S. If the busybodies at the United Nations simply need a topic to keep them occupied, perhaps they should deal with the ongoing scandal of sexual abuse by their own bureaucrats.

Here are but a few of the recent examples of UN personnel abusing their position:

  • Just in the last few weeks, more children have come forward to allege sexual abuse by UN peacekeepers in the Central African Republic.
  • In Haiti, UN personnel traded goods for sexual favors, exploiting several hundred women and girls.
  • In the Ivory Coast, ten UN peacekeepers reportedly gang raped a 13-year-old girl.
  • In Liberia, UN peacekeepers gave goods and presents in exchange for sex.
  • In Bosnia, some UN personnel not only patronized brothels featuring kidnapped women and victims of war, but also allegedly helped procure women for brothels.

This is just the tip of the iceberg.

P.P.S. I confessed years ago to a fantasy involving the United Nations.

P.P.P.S. But when I read about the UN’s efforts for gun control, global taxation, UN-imposed taxes, a world currency, the Law of the Sea Treaty, tax harmonization, restrictions on American sovereignty, and climate-change statism, my real fantasy is to raze the building.

P.P.P.P.S. I actually participated in a conference at the UN a few years ago, sort of a personal Daniel-in-the-lion’s-den experience.

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What’s the best way to generate growth and prosperity for the developing world?

Looking at the incredible economic rise of jurisdictions such as Hong Kong and Singapore, it’s easy to answer that question. Simply put in place the rule of law, accompanied by free markets and small government.

But that answer, while unquestionably accurate, would mean less power and control for politicians and bureaucrats.

So you probably won’t be surprised to learn that when politicians and bureaucrats recently met to discuss this question, they decided that development could be best achieved with a policy of higher taxes and bigger government.

I’m not joking.

Reuters has a report on a new cartel-like agreement among governments to extract more money from the economy’s productive sector. Here are some key passages from the story.

Rich and poor countries agreed on Thursday to overhaul global finance for development, unlocking money for an ambitious agenda… The United Nations announced the deal on its website… Development experts estimate that it will cost over $3 trillion each year to finance the 17 new development goals… Central to the agreement is a framework for countries to generate more domestic tax revenues in order to finance their development agenda… Under the agreement, the UN Committee of Experts on International Cooperation in Tax Matters will be strengthened, the press release said.

Though there’s not total agreement within this crooks’ cartel. There’s a fight over which international bureaucracy will have the biggest role. Should it be the Organization for Economic Cooperation and Development, which is perceived as representing the interests of revenue-hungry politicians from the developed world?

Or should it be the United Nations, which is perceived as representing the interests of revenue-hungry politicians from the developing world?

Think of this battle as being somewhat akin to the fight between various socialist sects (Mensheviks, Trotskyites, Stalinists, etc) as the Soviet Union came to power.

Bloomberg has a story on this squabble.

Responsibility for tax standards should be moved to the UN from the Organization for Economic Co-operation and Development, a group of 34 rich countries, according to a position paper endorsed by 142 civil-society groups. …Tove Maria Ryding from the European Network on Debt and Development, [said] “Our global tax decision-making system is anything but democratic, excluding more than half of the world’s nations.”

I’m tempted to laugh about the notion that there’s anything remotely democratic about either the UN or OECD. Both international organizations are filled with unelected (and tax-free) bureaucrats.

But more importantly, it’s bad news for either organization to have any power over the global economy. Both bureaucracies want to replace tax competition with tax harmonization, precisely because of a desire to enable big expansion is the size and power of governments.

This greed for more revenue already has produced some bad policies, including an incredibly risky scheme to collect and share private financial information, as well as a global pact that could be the genesis of a world tax organization.

And there are more troubling developments.

Here are some excerpts from another Bloomberg report.

Step aside, Doctors Without Borders. …A team called Tax Inspectors Without Borders will be…established next week by the United Nations and the Organization for Economic Cooperation and Development. …Tax Inspectors Without Borders would take on projects or audits either by flying in to hold workshops…or embedding themselves full time in a tax agency for several months… “There is a lot of enthusiasm from developing countries” for this initiative, said John Christensen, the U.K.-based director of the nonprofit Tax Justice Network.

Gee, what a surprise. Politicians and bureaucrats have “a lot of enthusiasm” for policies that will increase their power and money.

But at the risk of repeating myself, the more serious point to make is that bigger government in the developing world is not a recipe for economic development.

The western world became rich when government was very small. As noted above, Hong Kong and Singapore more recently became rich with small government.

But can anyone name a country that became rich with big government?

I’ve posed that question over and over again to my leftist friends and they never have a good answer.

If we want the third world to converge with rich nations, they need to follow the policies that enabled rich nations to become rich in the first place.

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