Think Tanks Wrap-up

WASHINGTON, Jan. 16 (UPI) -- The UPI Think Tank Wrap-Up is a daily digest covering brief opinion pieces, reactions to recent news events, and position statements released by various think tanks.

(The IPA is a nationwide consortium of policy researchers that seeks to broaden public discourse by gaining media access for experts whose perspectives are often overshadowed by major think tanks and other influential institutions.)

WASHINGTON -- Colombia, Haiti, and Enron

* Sandra Alvarez, Colombia program coordinator for Global Exchange, responds to news reports Wednesday that, according to administration officials, the "Bush administration is considering expanding U.S. counternarcotics assistance to Colombia to give more aid to that country's counterinsurgency war against leftist guerrillas."

"The resumption of the peace talks marks an important moment for Colombians and people worldwide who support a negotiated solution to that country's conflict. The U.S. has long supported a military solution to the four-decades-old conflict, disguising military aid as support for a 'War on Drugs.' Contrary to what our government is saying, we are not so much fighting drug trafficking in Colombia as we are strengthening a military for an escalation of the conflict. In response, all armed actors have been building their own capacities for war. In addition, instead of the United States responding to the call for peace, high level officials are making plans for an expansion of military aid beyond Counternarcotics."

* Cecilia Zarate-Laun, co-founder and program director of the Colombia Support Network.

"Thanks to the United Nations and the help of diplomats from ten countries, which have declared themselves friends and supporters of a negotiated solution to the Colombian civil war -- Canada, Spain, France, Italy, Cuba, Norway, Sweden, Switzerland, Mexico and Venezuela -- the threats for an imminent breakdown of the negotiations for peace in Colombia were overcome. All of this in spite of the United States, which after Sept. 11 placed enormous pressure on President Pastrana to end the peace process and to enhance the build-up of the Colombian military machine with the gift of 14 Black Hawk helicopters presented by Ambassador Patterson just last week."

* Ray Laforest, co-coordinator of the Haiti Support Network.

"The OAS is today considering imposing further economic sanctions on Haiti. This is clearly a U.S.-government-led attempt at forcing a much greater role for a small group of parties who represent a tiny minority."

* Wenonah Hauter, director of Public Citizen's Critical Mass Energy & Environment Program and co-author of the report "Blind Faith: How Deregulation and Enron's Influence Over Government Looted Billions from Americans."

"The Bush administration should immediately release all communications it has had with Enron because its selective disclosure of Enron contacts so far doesn't tell the whole story. For example, on Feb. 17, 2001, Bush's Secretary of the Treasury, Paul O'Neill, announced that the administration was scrapping an international treaty negotiated by Bill Clinton that would have ended the ability of U.S. corporations to utilize off-shore tax havens as vehicles to hide money. Enron is perhaps the largest abuser of this practice, employing 874 subsidiaries in the Cayman Islands and other nations with weak bank disclosure laws ..."

* Russell Mokhiber, editor of Corporate Crime Reporter.

"Much of the history of corporate crime and violence in this country has never seen the light of day because of corporate executives who follow closely the advice of corporate counsel -- when in doubt, shred it. By destroying relevant documents, Andersen (Arthur Anderson, the auditing firm)was apparently following to the letter advice often dished out by white collar defense lawyers, including that of Harvey Pitt, the accounting industry star defense lawyer until he became the current chair of the Securities and Exchange Commission. White collar defense lawyers like Pitt often advise corporate clients to implement flexible 'document retention' programs so that incriminating documents are destroyed before they see the light of day. In 1994, Pitt co-authored a law review article, 'When Bad Things Happen to Good Companies: A Crisis Management Primer.' 'At the crux of many corporate crises, there are typically a handful of key documents,' Pitt wrote. 'Corporate counsel must take every available opportunity to imbue company executives with the understanding that their documents will take on separate lives when they enter the treadmill of litigation. Ask executives and employees to imagine all their documents in the hands of a zealous regulator or on the front page of the New York Times. Each company should have a system of determining the retention and destruction of documents,' Pitt wrote. 'Obviously, once a subpoena has been issued, or is about to be issued, any existing document destruction policies should be brought to an immediate halt.'"

* Richard Grossman, co-director of the Program on Corporations, Law and Democracy, which recently released the book "Defying Corporations, Defining Democracy."

"The focus should not be so much on the individuals at the helm of Enron, but on the nation's and our states' legal and constitutional underpinnings. Our public officials are responsible for creating and empowering corporate legal entities like Enron which deny human rights and cause great harm. It is in the DNA of present-day corporations to consolidate power and wealth -- and to exercise governing powers over the people.

"Since we the people are supposed to be sovereign -- the source of all legal and political authority in this country through elections, lawmaking and public policy -- why do we permit our public officials to give our authority away to these artificial entities?"

Competitive Enterprise Institute

(CEI is a free-market think tank that supports principles of free enterprise and limited government, and actively engages in public policy debate.)

Broadband Dreams: The Tech Community Has a Vision

By James V. DeLong

Normally fractious tech executives agree: The nation needs broadband -- 100 million connections by 2010 -- and not at a piddling 0.5 or 1.5 megabytes, such as provided by most current technologies, but at blistering speed of 100 megabytes, such as can be provided by advanced fiber optics.

Furthermore, and more surprising, the companies agree that the basic method for achieving this goal should be less regulation and more reliance on market processes. There is no call for a "national broadband authority" or a new "broadband science institute."

For six months, stories have circulated that equipment and software companies are growing increasingly annoyed about the stalemate over broadband deployment among local telecoms, long distance telecoms, cable companies, Congress, and the Federal Communications Commission. While communications companies block each other and government dithers, tech applications stall, sales stagnate, and stock prices languish.

Does this mean you're accepting arguments that deployment is slow? Expanding broadband connections, the companies theorize, would enable a host of entertainment, e-learning, security, telecommuting, and health applications, juicing demand for everything.

Now the industry is rolling. This morning, TechNet, which "comprises more than 300 chief executive officers and senior partners of companies in the fields of information technology, biotechnology, venture capital, investment banking and law," released its paper on "A National Imperative: Universal Availability of Broadband by 2010," along with a media blitz.

Yesterday, the Information Technology Association of America wrote the president about broadband, sending along a recent white paper. Next week, the Computer Systems Policy Project will bundle up chief executives Michael Dell (Dell), Craig Barrett (Intel), Chris Galvin (Motorola), and Lars Nyberg (NCR) to hit all the Washington bases -- Congress, the Executive, and the press.

The gist of their thinking, as contained in TechNet's paper, is that the government should:

-- "Exercise regulatory restraint," and, specifically, release the Bells from any requirement to share facilities built through new investment, decline to impose unbundling rules on cable operators, and refrain from regulating new services such as Voice over Internet.

-- Make states and localities stop their greedy monopolizing behavior (TechNet's actual language is a little more restrained).

* Recognize the continuity between broadband deployment and the difficult problems of protecting intellectual property from piracy; content providers will not play unless they are secure.

-- Adopt market approaches to allocation of electromagnetic spectrum.

* Allow tax incentives to encourage deployment to underserved communities.

* Use government buying power to require that its needs be met by at least two different facilities-based providers.

One can quibble with some of this. We would go further, endorsing Tauzin-Dingell, but that bill is not going anywhere and action is moving to the FCC.

Another issue: a goal of 100 million 100-megabytes connections by 2010 sounds like a Soviet five-year plan. The industry is trying to solve the chicken-egg problem that applications do not develop without connections and connections do not blossom without applications, but this problem will not be solved by arbitrary goals.

If the players see that valuable applications are possible, and that broadband connections can be built at reasonable costs and revenues collected -- and that the government will not foul it up by playing favorites, protecting incumbents, establishing monopolies, confiscating property and engaging in other nefarious activities that usually characterize telecommunications policy -- then deployment will occur.

If these conditions are not met, then arbitrary goals will not help, as the lesson of the Telecommunications Act of 1996 shows.

On the whole, it is a good program. And it is wonderful to see an industry deciding to stop trying to capture the government to use to dish competitors and, instead, bet its future on simple rules, deregulation, property rights, and the market.

(James V. DeLong is a senior fellow with the Project on Technology and Innovation at the Competitive Enterprise Institute.)

Airline Executives Look Toward Washington with Hands Out

The federal government is being pressured to approve a round of loan guarantees for struggling airline companies, and the Competitive Enterprise Institute is urging caution when these applications are considered.

The loans were originally authorized by Congress as an emergency measure to prop up the industry after the losses of the Sept. 11 attacks. America West just received approval for its application, and other airlines are expected to follow suit and press their own claims.

Unfortunately, the program itself could easily end up accomplishing the opposite of its intended purpose -- making the industry less competitive and proving a liability for both taxpayers and air travelers.

"It is going to be difficult to determine whether an airline's distress really stems from Sept. 11," said James Gattuso, vice president for policy at CEI. "Remember, this industry was having a notoriously bad year even before last fall, with losses projected at $3 billion or more. An industry shakeout was widely predicted, and arguably much needed.

"Such a shakeout would certainly be bad for the losers, but ultimately good for consumers, as it forces the least well-managed to improve or make way for others."

Reason Foundation

Still Wrong After All These Years: Worldwatch Misdiagnoses the Planet Again.

By Ronald Bailey

The World Summit on Sustainable Development will convene in Johannesburg, South Africa, this coming September. The World Summit is the 10th anniversary follow-up to the Earth Summit in Rio de Janeiro in 1992.

At the Earth Summit, ideological environmentalism achieved considerable success in advancing its agenda for reshaping the world's economy. The Earth Summit saw the adoption of the Framework Convention on Climate Change, the Convention on Biological Diversity, and the incorporation of the precautionary principle in international treaties.

In the 10 years since the Earth Summit, the FCCC has led to the Kyoto Protocol, which aims at setting binding (and costly) limits on carbon dioxide emissions from burning fossil fuels in order to slow projected increases in the world's average temperature. The CBD process has spawned the Biosafety Protocol, which mandates onerous and scientifically illegitimate international regulations on genetically enhanced crops and farm animals.

Even more worrisome is the fact that the CBD and the new treaty on Persistent Organic Pollutants have incorporated the precautionary principle, which essentially declares that the expression of mere fears of potential harm provides enough basis to ban any new technologies and products.

The Washington, D.C.-based Worldwatch Institute has dedicated its annual compendium of environmentalist doom and gloom, the "State of the World 2002 Report," to "helping define the agenda for the World Summit." So what's on the agenda?

Among other things, Worldwatch wants to corral the United States into the Kyoto Protocol, encourage the widespread adoption of organic farming, and expand the reach of the precautionary principle.

The Kyoto Protocol would require the United States to cut the burning of energy-producing fossil fuels by around 25 percent of its projected 2012 level of consumption. Although the Worldwatch Institute treats global warming predictions as certain, satellite temperature measurements of the globe show far less warming than the climate computer models relied on by the activists predict.

Extrapolating satellite measurements, it appears that the globe's average temperature might increase by as much as 1 to 1.5 degrees centigrade over the next 100 years. Such an increase would not be an environmental disaster, but implementing deep immediate cuts in fossil fuel use could well be an economic one.

How costly is the Kyoto Protocol? Estimates vary, but a recent analysis published in "Science" this past November concluded that adopting the Kyoto Protocol would cost the United States as much as $125 billion annually.

In addition, Worldwatch activists well know that Kyoto is just the first cut, because the reductions mandated by that agreement would decrease potential global warming by an undetectable one-tenth of a degree centigrade over the next century. To stabilize carbon dioxide levels in the atmosphere would require that fossil fuel consumption be reduced by 70 to 80 percent.

Perhaps the most quixotic policy advocated by Worldwatch is the promotion of organic agriculture. Organic agriculture is generally only about two-thirds as productive as conventional modern agriculture. To raise the amount of food we now grow through other means organically would require plowing down 50 percent more land. This would clearly mean converting more wild lands like forests, wetlands, and grasslands into farms. Hardly an environmentally friendly prospect.

Other problems include the fact that there is only about one-sixth the amount of organic fertilizer (animal manure) necessary to sustain food production at current levels if we went all organic. Organic doctrine also forbids farmers from planting genetically enhanced crops. This means that among other things organic farmers must forego "no-till" agriculture, which prevents 90 percent of soil erosion by using herbicide-resistant crops so that farmers don't have to plow to control weeds.

The fact is that conventional agriculture using pesticides and fertilizers has nearly tripled global food production in the last 50 years. Food is cheaper and more abundant now than ever before in history. Dennis Avery, director of the Center for Global Food Issues at the Hudson Institute, notes, "One continent, Africa, practices organic farming and it is the only continent in which hunger is increasing."

Sustainable development is often defined as "ensuring that human needs are met in a way that protects the natural environment without undermining the prospects of future generations." Organic agriculture is almost the opposite of sustainable development.

Worldwatch is still promoting one of the hoariest dogmas of ideological environmentalism: that modern synthetic chemicals like plastics and pesticides are reducing average life spans through epidemics of cancer. This doctrine, popularized by Rachel Carson in her influential book "Silent Spring" in 1962, remains a bedrock tenet of environmentalism even though decades of scientific research have never shown it to be true.

Worldwatch actually still maintains that breast cancer is increasing and that sperm counts are declining because of exposure to synthetic chemicals, although there is no epidemiological evidence for these assertions. In fact, epidemiologists conclude that 2 percent at most of all cancers can be attributed to exposure to man-made substances.

To control synthetic chemicals, the Worldwatchers want the participants at the World Summit to broaden the reach of the "precautionary principle," which would require manufacturers to prove that their products are completely safe before they would be allowed to sell them. The precautionary principle fails utterly to acknowledge that while there are risks in technological innovation, there are also risks in technological stagnation.

In fact, history clearly shows that the balance of risks favors technological innovation over the harm-prevention strategy embodied in the precautionary principle. After all, since the advent of modern chemicals in the 1920s and whatever risks they pose, the average American's life expectancy has increased by 20 years.

There is one bright note in this 19th edition of the "State of the World." Earlier volumes in the series regularly forecasted imminent global famine, but this year's chapter on population issues is much less alarmist. The new tone may be the result of the departure of the Institute's doomster founder Lester Brown. Or it may just be that this group of activists can no longer ignore the demographic and economic realities that show that many population trends are positive. Worldwatch now recognizes that if current trends continue, world population will likely peak at between 7.9 and 10 billion in the next 50 years.

Also, Worldwatchers are apparently beginning to understand that poverty, not population, is the chief source of environmental harm. Unfortunately, they do not show any understanding of how economic growth fueled by free markets, secure property rights, and expanding global trade is essential to alleviating poverty and protecting the natural world.

However, the vision of a crowded, resource-depleted world promoted by early environmental fundamentalists may at long last now be fading.

(Ronald Bailey is Reason magazine's science correspondent and the editor of "Earth Report 2000: Revisiting the True State of the Planet.")

Cato Institute

Moral Colonialism

By Tomas Larsson

When the U.S. House voted on fast track trade promotion authority recently, the issue of environmental havoc and mistreated workers surfaced as it has in similar debates over trade liberalization. Now, with the recession and increased unemployment, the protectionist sentiment is again trying to disguise itself in the clothes of global solidarity. But while some critics may be disingenuous in their push for so-called "fair trade," others are doubtless sincere -- and it is worthwhile understanding why their sentiments are misplaced.

As Jagdish Bhagwati, professor of economics at Columbia University, has noted, imposing limits to trade to promote moral or environmental concerns amounts to a kind of colonialism. Its principle is "might makes right," with the larger, richer, most powerful countries lording it over the not-so-rich and not-so-powerful ones.

The United States can impose trade sanctions against India if Indian fishermen are nasty to cute dolphins. But India cannot realistically bar trade with the United States if Americans are nasty to cows. Similarly, the United States can punish Norway if Norwegians do not want to eat gene-manipulated beef. But Norway cannot realistically punish the United States if U.S. labor law is less generous toward union interests than Norwegian labor law.

Are contentious issues of governance -- about which there is rarely consensus even within the boundaries of a particular country -- really to be settled by trade clauses, rather than domestic politics and persuasion? Rather, we should accept as a basic tenet of trade policy that ethical choices must be made mainly by the producers and consumers themselves -- not by politicians and bureaucrats acting in their name.

In any case, "ethical" trade restrictions rarely, if ever, achieve what they set out to achieve. The key causes of poor labor and environmental standards are poverty and despotism, and there is little that yet another bout of protectionism can do to alleviate poverty or foster freedom and democracy in countries like China, Pakistan and Burma.

In fact, trying to promote "core labor standards" via tariff barriers may well accomplish the opposite of its intention.

Keith E. Maskus, an economist at the University of Colorado, has studied the issue of core labor standards for the World Bank. He concludes that attempts to stop so-called "social dumping" from poor nations pose a "real and serious risk" to the well-being of some of the most vulnerable members of Third World societies.

"The celebrated French ban of soccer balls sewn in Pakistan for the World Cup in 1998 resulted in significant dislocation of children from employment. Those who tracked them found that a large proportion ended up begging and/or in prostitution," Maskus told me.

Shutting down a non-optimal opportunity does not thereby install a better one in its place.

The true fear of many protectionists is that trade with countries with lower labor standards will engender loss of jobs back home. But in general, poor labor standards are a competitive disadvantage to an economy -- or result from deeper problems that hamper the economy. The "race to the bottom" is a figment of imagination: It is not, after all, countries with the worst human rights records that top the annual rankings of national competitiveness, dominate export markets or attract the lion's share of foreign direct investment.

This is hardly surprising. National leaders who pay scant attention to the rights of workers are unlikely to pay much attention to a host of other important civic protections either: private property rights, freedom of the press, the rule of law, etc.

Governments that recognize legitimate social interests are more likely to respect private property and contracts. This makes for less arbitrary government, more predictable rules, and a better climate for investment and innovation.

It should be kept in mind that almost all countries that are today prosperous and democratic were once poor and undemocratic. Increased international trade is one of the factors that has led to rising prosperity -- and to rising demands for political openness. In recent years the process has been evident in such Asian nations as South Korea, Taiwan, the Philippines, Thailand and Indonesia.

Concerns about labor and environmental standards are legitimate. What rich countries can do to help is dismantle trade barriers. Both the United States and the EU levy lower tariffs on unprocessed goods from the developing world than they do on processed goods. As a result, fewer jobs for educated youths are created than would otherwise be possible.

For those who feel concern for the fate of the developing world, giving the president the ability to expand trade gives those countries a hand up. Unfortunately, that's the last thing on the labor-controlled left's mind.

(Tomas Larsson is the author of "The Race to the Top: The Real Story of Globalization")