Tag: united nations

Obama Lonely at U.N. Climate Fest

People should learn from their mistakes. The last time President Obama took it upon himself to “lead” a U.N. climate fest was at Copenhagen in December, 2009, which, from the point of view of my greener friends, was a notorious failure. 

Today, he’s back, this time at Ban Ki-moon’s U.N. “climate summit,” but not a lot of his global peers are going to be there. Prime Ministers from China, India, Canada, Australia and Germany have all decided to stay home. 

Together, they emit almost three times what the U.S. does, which means we are going it alone in New York.  Any policy we agree to is  meaningless.  According to the EPAs “Model for the Assessment of Greenhouse-gas Induced Climate Change” (yes, it is MAGICC), if we emitted not another molecule of carbon dioxide between tomorrow and January 1, 2100, the amount of warming that would be prevented is a mere 0.14°C, an amount too small to reliably measure. That’s probably an overestimate, too, as the EPA appears to have overestimated 21st century warming.

EPA assumes  that the “sensitivity” of surface temperature to a carbon dioxide doubling is 3°C, an amount very likely far too great, compared to what is being observed.  Or, perhaps, compared to what is not being observed, as global surface temperatures have held constant for 17+ years now (actually 19, according to Cato scholar and eco-statistician Ross McKitrick), according to the surface annual temperature history that climate scientists cite the most. So the “saved” warming from any policy is likely to be even less than what MAGICC says.

You’re not going to hear that from the President. As happened at the 2009 Copenhagen disaster, the President and the Secretary-General will declare a roaring success.

In Copenhagen, that meant that all participants had to submit specific action plans to reduce emissions within two months.  But, a bit more than a month before the deadline, the U.N.’s climate commissioner, Yvo deBoer, announced that they really didn’t have to. Then he resigned.

There’s still no new international agreement to replace the failed Kyoto Protocol. But, last month, the President got people pretty worked up when he proposed a new, U.N.-sponsored agreement (a treaty—or a modification of an existing one—by any other name) on climate change that he didn’t think would require ratification by a two-thirds vote of the Senate, counter to what is explicitly stated in Article II, Section 2, Clause 2 of our constitution:

[The President] shall have Power, by and with Advice and Consent of the Senate, to make Treaties, provided two thirds of the Senators present concur… 

Not only is the president going to be quite lonely at the U.N., he could be setting the country up for a huge constitutional conflagration.

It’s not going to happen on his watch, though. Any agreement that he signs on to won’t likely take effect until at least 2016.  Even under the most rosy Democrat-wave election that year (one is likely to happen, given the demographics of the Senate crowd that is up for re-election), there’s no way 67 are going to vote to ratify a treaty that differentially harms the U.S. while China and India keep increasing their emissions dramatically.

Of course we’re going to hear the rhetoric, repeated again today, that the U.S. has to “lead by example.”  Well, Mr. President, with those big emitters and the developing world saying “no way,” no one is going to follow.  In 2012, the last year for which we have reliable data, the U.S. contributed 14% of global carbon dioxide emissions. Together, the five big no-shows emitted almost three times as much as us, and their fraction can only grow as both China and India are determined to develop their economies.

If we were really going to lead by example we would show the world how our free economy has resulted in investments in clean, big power sources like shale gas. The developing world is currently lacking in large sources of dense energy. If we’re going “lead by example,” maybe that example should be that governments should get out of the way of economic development and cleaner energy will follow. 

Does Freedom of Speech Conflict with Freedom of Religion?

This is a provocative question, of course, or at least it is seemingly everywhere in the world but the United States. In just the last three years, the Supreme Court has protected highly offensive funeral protests, violent video games, animal “crush” videos, and a host of other types of expression. No law punishing blasphemy or “defamation of religion”—as approved by various UN resolutions and making inroads into the legal codes of even Western countries—could possibly survive First Amendment scrutiny. But that’s not the case elsewhere in the world, as an excellent new video by Danish human rights lawyer Jacob Mchangama shows (courtesy of Free to Choose TV; see press release):

America isn’t immune from increasing demands that free speech be limited to respect religious feelings. Recall the condemnations of the anti-Islamic video that may have caused rioting in Cairo on September 11 of last year (but not in Beghazi, as details of that scandal develop). The outcome of this battle will have profound consequences for the ability of people everywhere to freely express themselves and follow their beliefs. Democratic governments play a dangerous game when appeasing religious sensitivities rather than defending free speech.

Mchangama, not coincidentally, is affiliated with the invaluable Human Rights Foundation—an organization that deals with actual human rights violations rather than simply being a vehicle for pushing a transnational leftist agenda—whose president, Thor Halvorssen (with whom I’ve been acquainted since college), calls himself a “classical liberal” rather than a man of the Right or Left.

Another UN Push for Global Taxation

But I guess I’m not very persuasive. The bureaucrats have just released a new report entitled, “In Search of New Development Finance.”
As you can probably guess, what they’re really searching for is more money for global redistribution.
But here’s the most worrisome part of their proposal: they want the UN to be in charge of collecting the taxes, sort of a permanent international bureaucracy entitlement.
I’ve written before about the UN’s desire for tax authority (on more than one occasion), but this new report is noteworthy for the size and scope of taxes that have been proposed.
Here’s the wish list of potential global taxes, pulled from page vi of the preface:

Below is some of what the report has to say about a few of the various tax options. We’ll start with the carbon tax, which I recently explained was a bad idea if it were to be imposed on Americans by politicians in Washington. It’s a horrible idea if imposed globally by the kleptocrats at the UN.

…a tax of $25 per ton of CO2 emitted by developed countries is expected to raise $250 billion per year in global tax revenues. Such a tax would be in addition to taxes already imposed at the national level, as many Governments (of developing as well as developed countries) already tax carbon emissions, in some cases explicitly, and in other cases, indirectly through taxes on specific fuels.

Notice that the tax would apply only to “developed countries,” so this scheme is best characterized as discriminatory taxation. If Obama is genuinely worried about jobs being “outsourced” to developing nations like China (as he implies in his recent attack on Romney), then he should announce his strong opposition to this potential tax.

But don’t hold your breath waiting for that to happen.

Next, here’s what the UN says about a financial transactions tax:

A small tax of half a “basis point” (0.005 per cent) on all trading in the four major currencies (the dollar, euro, yen and pound sterling) might yield an estimated $40 billion per year. …even a low tax rate would limit high-frequency trading to some extent. It would thus result in the earning of a “double dividend” by helping reduce currency volatility and raising revenue for development. While a higher rate would limit trading to a greater extent, this might be at the expense of revenue.

This is an issue that already has attracted my attention, and I also mentioned that it was a topic in my meeting with the European Union’s tax commissioner.

But rather than reiterate some of my concerns about taxing financial consumers, I want to give a bit of a compliment to the UN: the bureaucrats, by writing that “a higher rate … might be at the expense of revenue,” deserve credit for openly acknowledging the Laffer Curve.

By the way, this is an issue where both the United States and Canada have basically been on the right side, though the Obama administration blows hot and cold on the topic.

Now let’s turn to the worst idea in the UN report. Its authors want to steal wealth from rich people. But even more remarkable, they want us to think this won’t have any negative economic impact.

…the least distorting, most fair and most efficient tax is a “lump sum” payment, such as a levy on the accumulated wealth of the world’s richest individuals (assuming the wealthy could not evade the tax). In particular, it is estimated that in early 2012, there were 1,226 individuals in the world worth $1 billion or more, 425 of whom lived in the United States, 90 in other countries of the Americas, 315 in the Asia-Pacific region, 310 in Europe and 86 in Africa and the Middle East. Together, they owned $4.6 trillion in assets, for an average of $3.75 billion in wealth per person. A 1 percent tax on the wealth of these individuals would raise $46 billion in 2012.

I’ll be the first to admit that you can’t change people’s incentives to produce in the past. So if you steal wealth accumulated as the result of a lifetime of work, that kind of “lump sum” tax isn’t very “distorting.”

But here’s some news for the UN: rich people aren’t stupid (or at least their financial advisers aren’t stupid). So you might be able to engage in a one-time act of plunder, but it is naiveté to think that this would be a successful long-term source of revenue.

For more information, I addressed wealth taxes in this post, and the argument I was making applies to a global wealth tax just as much as it applies to a national wealth tax.

Now let’s conclude with a very important warning. Some people doubtlessly will dismiss the UN report as a preposterous wish list. In part, they’re right. There is virtually no likelihood of these bad policies getting implemented any time in the near future.

But UN bureaucrats have been relentless in their push for global taxation, and I’m worried they eventually will find a way to impose the first global tax. And if you’ll forgive me for mixing metaphors, once the camel’s nose is under the tent, it’s just a matter of time before the floodgates open.

The greatest threat is the World Health Organization’s scheme for a global tobacco tax. I wrote about this issue back in May, and it seems my concerns were very warranted. Those global bureaucrats recently unveiled a proposal—to be discussed at a conference in South Korea in November—that would look at schemes to harmonize tobacco taxes and/or impose global taxes.

Here’s some of what the Washington Free Beacon wrote:

The World Health Organization (WHO) is considering a global excise tax of up to 70 percent on cigarettes at an upcoming November conference, raising concerns among free market tax policy analysts about fiscal sovereignty and bureaucratic mission creep. In draft guidelines published this September, the WHO Framework Convention on Tobacco Control indicated it may put a cigarette tax on the table at its November conference in Seoul, Korea. …it is considering two proposals on cigarette taxes to present to member countries. The first would be an excise tax of up to 70 percent. …The second proposal is a tiered earmark on packs of cigarettes: 5 cents for high-income countries, 3 cents for middle-income countries, and 1 cent for low-income countries. WHO has estimated that such a tax in 43 selected high-/middle-/low-income countries would generate $5.46 billion in tax revenue. …Whichever option the WHO ends up backing, “they’re both two big, bad ideas,” said Daniel Mitchell, a senior tax policy fellow at the Cato Institute. …Critics also argue such a tax increase will not generate more revenue, but push more sales to the black market and counterfeit cigarette producers. “It’s already a huge problem,” Mitchell said. “In many countries, a substantial share of cigarettes are black market or counterfeit. They put it in a Marlboro packet, but it’s not a Marlboro cigarette. Obviously it’s a big thing for organized crime.” …The other concern is mission creep. Tobacco, Mitchell says, is easy to vilify, making it an attractive beachhead from which to launch future vice tax initiatives.

It’s my final comment that has me most worried. The politicians and bureaucrats are going after tobacco because it’s low-hanging fruit. They may not even care that their schemes will boost organized crime and may not raise much revenue.

They’re more concerned about establishing a precedent that international bureaucracies can impose global taxes.

I wrote the other day about whether Americans should escape to Canada, Australia, Chile, or some other nation when the entitlement crisis causes a Greek-style fiscal collapse.

But if the statists get the power to impose global taxes, then what choice will we have?

When Obama and Romney Talk Foreign Policy, Who Wins?

The presidential campaign will focus on foreign policy for a few hours on Tuesday when President Obama addresses the United Nations General Assembly in New York City while his Republican challenger Mitt Romney will address the Clinton Global Initiative just a few miles away. Each will try to wring some political advantage from speeches that are generally directed at foreign audiences.

Neither candidate is likely to come out a winner, although for different reasons. It will be difficult for President Obama to convince the electorate and the world that U.S. policies, particularly in the volatile Greater Middle East, are succeeding. But Mitt Romney’s challenge is greater. He must convince voters that his policies would result in tangible gains. It isn’t clear that they would, however, nor that his policies are sufficiently different from the president’s to convince voters to change horses in mid-stream.

The president is likely to call for staying the course. Echoing Secretary of State Hillary Clinton’s remarks from last week, he will try to convince the people of the Middle East that the United States remains their friend and partner, and he will tell skeptical Americans that the feeling is mutual. He may point to the large quantities of aid that U.S. taxpayers have sent to the region to win points with foreign audiences, but this risks alienating the voters here at home.

Obama may also emphasize that the United States intends to maintain a large military presence in the region so as to, as Secretary Clinton said last week, “help bring security to these nations so that the promise of the revolutions that they experienced can be realized.” But foreign listeners aren’t convinced that the United States has helped bring security to anyone, and they certainly don’t want U.S. help now.

Obama’s message to Americans, delivered between the lines of his UN speech, is that the United States cannot afford to disengage from the region. Be patient, Obama will say. Many decades of trying to manage the political affairs of other countries, often with the heavy hand of the U.S. military, has carried high costs and delivered few clear benefits, but it could have been worse.

Not so, says Romney and the Republicans. President Obama’s outreach to the Muslim world has clearly failed, they claim. The Cairo speech in 2009, followed by the belated support for anti-Mubarak protesters in Egypt in 2011, and finally the decision to use U.S. military power to topple Muammar Gaddafi in Libya, don’t appear to have purchased us much good will. On the contrary, anti-American sentiment is running high, higher even than when Obama took office, according to some polls. The violence against U.S. officials and property merely punctuates the grim statistics, and invites ominous parallels to 1979.

But while Obama’s task will be difficult, Mitt Romney has an even higher hill to climb. He must differentiate his policies from the president’s and persuade U.S. voters, especially, but also the skeptics abroad, that his policies would be much better. His surrogates have implied that the events of the past fortnight certainly would not have occurred had Romney been in the Oval Office, but they haven’t explained how or why that is true.

Meanwhile, the few concrete policies that Romney champions are deeply unpopular in the region, and not much more popular with U.S. voters. His calls to add nearly $2 trillion in military spending over the next decade suggest a willingness to increase the U.S. military presence around the world, but especially in the Greater Middle East. Most Americans want U.S. troops to be brought home. His leading foreign policy adviser has criticized the Obama administration for refusing to intervene in the Syrian civil war. This suggests that the problem with U.S. policy has been too little meddling in the internal affairs of foreign countries, whereas most Americans believe that there has been too much. And Romney did not endorse Sen. Rand Paul’s effort to tie U.S. aid to conditions, so it is hard to see how he can score points against President Obama by promising to stick with the status quo.

However, all of these other issues pale in comparison to the most visible U.S. policy in the region of the past decade: the Iraq war. That disastrous conflict will hang heavily over Romney’s speech, as it has over his entire campaign, and over the GOP for several election cycles. Although most Americans now believe that the war never should have been fought, and most non-Americans never thought that it should have been, Romney refuses to repudiate it. On the contrary, he has staffed his campaign with some of the war’s leading advocates. Given his famous aversion to anything that might be construed as an apology, Romney is unlikely to evince any doubts about the war in his speech on Tuesday. But if he wants to convince voters that he will be a more capable steward of U.S. foreign policy than Obama has been, he must at least explain what lessons he takes away from an unpopular war. Otherwise, his implicit assertion that it couldn’t get any worse will fall flat with those who believe that it certainly could.

Should International Bureaucracies Get Taxing Powers or Direct Funding?

Over the years, I’ve strenuously objected to schemes that would enable international bureaucracies to levy taxes. That’s why I’ve criticized “direct funding” proposals, most of which seem to emanate from the United Nations.

Interestingly, the American left is somewhat divided on these schemes. House Democrats have expressed sympathy for global taxes, but the Obama administration has come out against at least certain worldwide tax proposals.

Unfortunately, proponents of global taxes are like the Energizer Bunny of big government, relentlessly pushing a statist agenda. If the world economy is growing, it’s time for a global tax. If the world economy is stagnant, it’s time for a global tax. If it’s hot outside or cold outside, it’s time for a global tax (since “global warming” is one of the justifications for global taxation, I’m not joking).

Given this ongoing threat, I’m glad that Brian Garst of the Center for Freedom and Prosperity has put together a two-page Libertas explaining why international bureaucracies should not get taxing powers or direct funding.

…it would be imprudent to give international bureaucracies an independent source of revenue. Not only would this augment the already considerable risk of imprudent budgetary practices, it would exacerbate the pro-statism bias in these organizations. …The issue of taxing powers and direct funding has become an important issue because international organizations are challenging the contribution model and pushing for independent sources of revenue. The United Nations has been particularly aggressive in pushing for global taxes, seeking to expand its budget with levies on everything from carbon to financial transactions.

He then highlights one of the most dangerous proposals, a scheme by the World Health Organization to impose a “Solidarity Tobacco Contribution.”

Another subsidiary of the United Nations, the World Health Organization (WHO), is also looking to self-fund through global taxes. The WHO in 2010 publicly considered asking for global consumer taxes on internet activity, online bill paying, or the always popular financial transaction tax. Currently the WHO is pushing for increased excise taxes on cigarettes, but with an important condition that they get a slice of the added revenue. The so-called Solidarity Tobacco Contribution would provide billions of dollars to the WHO, but with no ability for taxpayers or national governments to monitor how the money is spent.

I have to give the left credit. They understand that few people are willing to defend tobacco, so proposing a global tax on cigarettes sounds noble, even though the real goal is to give the WHO a permanent stream of revenue.

Brian explains, though, why any global tax would be a mistake.

What all of these proposals have in common – in addition to their obvious intended use in promoting statist policies – is that they would erode the influence of national governments, reduce international accountability, promote waste, and undermine individual sovereignty and liberty. …Before long, international organizations will begin proposing – no doubt in the name of efficiency or reducing the burden on nation states – that affected taxpayers withhold and transfer taxes directly to the international body. This would effectively mean the end of the Westphalian system of sovereign nation states, and would result in a slew of new statist policies, and increased waste and corruption, as bureaucrats make use of their greater freedom to act without political constraint.

He concludes by noting that a global tobacco tax would be the proverbial camel’s nose under the tent. Once the statists succeed in imposing the first global tax, it will simply be a matter of time before additional levies are imposed.

National governments should not be fooled. Any sort of taxing power or direct funding for international bureaucracies would undermine national sovereignty. More importantly, it will further weaken the ability of people to influence and control the policies to which they are subjected. Moreover, once the first global tax is imposed, the floodgates will be opened for similar proposals.

The point about fiscal sovereignty is also important. Not because national governments are keen to adopt good policy, but because nations at least have to compete against each other.

Over the years, tax competition among governments has led to lower tax rates on personal and corporate income, as well as reductions in the double taxation of income that is saved and invested.

Politicians don’t like being pressured to lower tax rates, which is why international bureaucracies such as the Organization for Economic Cooperation and Development, acting on behalf of Europe’s welfare states, are pushing to undermine tax competition. But so long as there’s fiscal sovereignty, governments will have a hard time imposing confiscatory tax burdens.

Any form of global taxation, however, cripples this liberalizing process since taxpayers would have no safe havens.

Daniel in the Looter’s Den: My Adventures at the UN

I was at the United Nations yesterday for something called “The High Level Thematic Debate on the State of the World Economy.”

Most speakers, including the secretary general of the United Nations, the president of the European Commission, Paul Volcker, and Joseph Stiglitz, to varying degrees blamed private markets for the fiscal and financial problems of the world. Not surprisingly, there also was a consensus for more government—usually wrapped up in buzzwords such as “sustainable development” and “equitable growth” and ”coolective action”

I spoke in the afternoon as part of a roundtable on the economic crisis (see full schedule here). There were five speakers on my panel, including yours truly. Here are my thoughts on what the others said.

Dr. Supachai Panitchpakdi, secretary-general of the United Nations Conference on Trade and Development, must have been part of the buzz-word contest I mentioned yesterday. Lots of rhetoric that theoretically was inoffensive, but I had the feeling that it translated into a call for more government. But maybe I’m paranoid, so who knows.

Professor Dato’ Dr. Zaleha Kamaruddin, rector of the International Islamic University of Malaysia, was an interesting mix. At some points, she sounded like Ron Paul, saying nice things about the gold standard and low tax rates. But she also called for debt forgiveness and other forms of intervention. She explicitly said she was providing Islamic insights, so perhaps the strange mix makes sense from that perspective.

Former U.S. senator Alan K. Simpson also was a mixed bag. Simpson was co-chair of President Obama’s fiscal commission, which I thought was a disappointment because it endorsed higher taxes and urged subpar entitlement changes rather than much-needed structural reforms. He also went after Grover Norquist because of the no-tax pledge, which I think is a valuable tool to keep Republicans from selling out for bigger government. All that being said, Senator Simpson is a promoter of smaller government and he wants lower tax rates. So while I disagree with some of his tactical decisions, he was an ally on the panel and would probably do a pretty good job if he was economic czar.

Last but not least, Professor Jeffrey Sachs of Columbia University was a statist, as one would expect based on what I wrote about him last year. We clashed the most, arguing about everything from tax havens to the size of government. Interestingly, we both said nice things about Sweden, but I was focusing on policies such as school choice and pension reform, while he admired the large public sector. But I will admit he was a nice guy. We sat next to each other and did find a bit of common ground in that we both were sympathetic to the way Sweden dealt with its financial crisis about 20 years ago (a version of the FDIC-resolution approach rather than the corrupt TARP bailout approach).

My message, by the way, was very simple: Higher taxes won’t work. The “growth” vs. “austerity” debate in Europe is really a no-win fight between those who want higher spending vs. those who want higher taxes. The only good answer is to restrain spending with—you guessed it—Mitchell’s Golden Rule.

The good news is that I wasn’t tarred and feathered. Indeed, I even got a modest amount of positive feedback. The bad news is that I doubt I moved the needle.

But at least the United Nations was willing to have contrary voices, unlike the Organization for Economic Cooperation and Development, which once threatened to cancel a Global Tax Forum because of my short-lived participation.

Bolivia Withdraws From UN Drug Convention

I never thought I would say this, but Evo Morales is right (this time). The Bolivian president asked the nation’s Congress to pass a law that would take his country out of the United Nations Single Convention on Narcotic Drugs. The bill already passed the lower chamber of Congress and is likely to be approved by the Senate where Morales enjoys a two-thirds majority.

Bolivia is withdrawing from the UN Convention over the country’s failed efforts to have the coca leaf removed from the list of international illicit drugs. Chewing coca leaf is an ancestral and common practice in Bolivia and neighboring Andean countries. It helps people cope with fatigue and high altitude (I’ve tried it myself during a visit to the province of Jujuy in Argentina). The Bolivian amendment to the UN Convention was defeated after strong opposition from the United States and other developed countries.

This is precisely the kind of “drug control imperialism” that was recently denounced by the groundbreaking report of the Global Commission on Drug Policy. It rightly states that the UN (as a result of pressure from the U.S. government in particular), has “worked strenuously over the past 50 years to ensure that all countries adopt the same rigid approach to drug policy –the same laws, and the same tough approach to their enforcement.”

Given the obstinate resistance of Washington to allow even the most timid and sensible changes in international treaties such as declassifying the coca leaf as an illegal substance, one must applaud the decision of the government in La Paz to denounce the UN Nations Single Convention on Narcotic Drugs.

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