Why the blackout in the northeast is a call for more deregulation, not less
Many people have been quick to blame deregulation of electricity markets for the blackout disaster in the northeast. When I talk about deregulation, I'm really talking about the combination of the loosening of government controls over the industry, and the privatisation of power utilities and grids. Let me just make this disclaimer though. No matter what happens, there is no way to guarantee that another blackout along the lines of what happened last week will not occur again. We cannot predict with absolute certainty that the lights will never go out again.
Many of the media's talking heads and national politicians have blamed a lack of investment in the electricity grid for allowing the blackouts to become so widespread. In some cases, a publicly owned utility operates and owns the electrical grid, and the sources. In others, the powerplants are privately owned, but the grid may be owned by the state, or another private company. In all cases, the same problem occurs. Power generation, and power distribution are cases of natural monopoly. Because of high start-up costs, there are few or no new entrants to the industry. The response to this monopoly position is to regulate the utilities. This makes sense because monopolies free to choose their own price and production will tend to produce less than what the market needs. Unfortunately, the urge is to have average cost pricing which reduces the company's profits to zero, which in turn gives no incentive for the company to reinvest in it.
There is nothing inherently wrong with having publicly-owned utilities. The main problem is that the government must stump up the cash to pay for needed upgrades and expansion of the system, which tends to result in higher taxes. Many state, provincial and national governments have become incredibly tightfisted with their budgets, and as a result privatisation has become the only option. At least private investors make their investments willingly. Though, without government subsidies, consumers may appear to face higher prices.
In short, the problem with regards to the blackouts has been that the power grid has not received the necessary infrastructure upgrades, most likely because governments have not been able to afford to upgrade the system, or private utilities have been denied the incentive to make the necessary upgrades because over-regulation has significantly reduced their profits.
More deregulation would entail more privately-owned utilies and a privatised distribution grid, each with the freedom to make profit-maximising investment decisions (and thus the necessary upgrades). More deregulation would also entail less disruption of the energy market with subsidies, and perhaps lower taxes (or at least more money for social programs).
No one wants to pay higher energy prices, but perhaps higher prices are just the kick in the pants that this world needs to be more realistic about energy consumption. People should not pay some lump sum for electricity access. Consumers must be billed by consumption. The costs could be scaled to discourage profligate usage.
Ugh, like all other topics, I hope to get back to this.
Monday, August 18, 2003
Monday, July 28, 2003
Should America Intervene in Liberia?
For many people, this seems like a no-brainer. Not faced with the real costs of a troop demployment, it's easy enough to be an armchair general and assume that American should intervene because it's the right thing to do. Amazingly, the argument that it's the right thing to do is probably the strongest one in favour of a deployment in Liberia. I believe that there is reason to be much more cautious about a deployment, but I would still back it.
Why should America intervene? Some people claim that America should intervene because of cultural ties, and because Liberia was founded by freed American slaves. This argument is pretty week in my opinion. Do former colonial powers have obligations to their former dependencies? Most former colonies tend to spurn intervention by their former colonial masters. There is no international law that says so. The existence of such a law would legitimate much more intervention on the part of former colonial powers, and it's probably good that such a law does not exist. America did not cause Liberia's current woes. Charles Taylor brought this upon his country by spurring civil wars in neighbouring countries. Once a colony gains independence, the obligations of the colonial master are practically nullified. The only obligation may be a moral one, which leads to the next argument in favour.
The most vital argument in favour of intervention is that morally, it makes sense. Liberia has been suffering from civil war for years, and it is among the poorest countries in the world. Liberia's long suffering people need intervention to prevent massive bloodshed. The costs versus the benefits would be quite favourable given the number of people who's lives could be saved by a small, but well-equiped intervention force, coupled with humanitarian assistance. An American intervention would likely be successful, especially since unlike many other places, the locals actually WANT them there. A disciplined, and well equiped intervention force could probably beat back the drugged up thugs of both the government and rebel armies.
Why shouldn't America intervene? In the short term, the main argument against intervention is that the situation is way to chaotic to act in a peacekeeping capacity. Also, what would be America's role? Would they be propping up the government? Really, America wants to see Charles Taylor go, so intervening could run counter the long-run interest of Liberians, who would be better off without him. The situation on the ground is very fluid, and ceasefire has been a joke. There is the potential for America's intervention force to get a bloody nose if they meet organised resistance from either the government or the rebels. America does not want to invade. Their role (as they hope) would be to bring security and calm by helping to enforce a ceasefire, and facilitating negociations. For all practical purposes, there will be no intervention without a voluntary ceasefire from both sides. The chance of a lasting ceasefire is fairly low at present, which decreases the likelyhood of American intervention.
Another argument against intervention is that America's interests are not at stake, and they don't need more military expenditure at this point. Paying for military intervention is like pissing on your tax money, and then burning it. Those costs are basically a black hole. Defence planners are already talking about over-extension. For America there would not seem to be any tangible gain from intervention. Liberia has little strategic value, and no strategic resources to keep secure (such as oil). The only gains from intervention would be diplomatic. America could demonstrate some compassion by intervening where their interests are not at stake. This could give them a bit more clout internationally, since America's influence has been changing with their new commitment to unilateralism.
So, should America intervene? My gut says they they should and beat back both sides to ensure humanitarian aid. On the other hand, they could be playing into the hands of Charles Taylor, who could conveniently stay in power, or manipulate things form behind the scenes. Really, Mr. Talyor should be indicted for crimes against humanity in the International Criminal Court. What would happen in Liberia if America did intervene? What if they could force Mr. Taylor out? Would they play the kingmaker in Liberia as well? The other thing is that, despite the moral ramifications, it make more practical sense to wait for some calm on the ground. This looks unlikely. Maybe the rebels can take the capital and oust Charles Taylor. What will happen then? God knows!
For many people, this seems like a no-brainer. Not faced with the real costs of a troop demployment, it's easy enough to be an armchair general and assume that American should intervene because it's the right thing to do. Amazingly, the argument that it's the right thing to do is probably the strongest one in favour of a deployment in Liberia. I believe that there is reason to be much more cautious about a deployment, but I would still back it.
Why should America intervene? Some people claim that America should intervene because of cultural ties, and because Liberia was founded by freed American slaves. This argument is pretty week in my opinion. Do former colonial powers have obligations to their former dependencies? Most former colonies tend to spurn intervention by their former colonial masters. There is no international law that says so. The existence of such a law would legitimate much more intervention on the part of former colonial powers, and it's probably good that such a law does not exist. America did not cause Liberia's current woes. Charles Taylor brought this upon his country by spurring civil wars in neighbouring countries. Once a colony gains independence, the obligations of the colonial master are practically nullified. The only obligation may be a moral one, which leads to the next argument in favour.
The most vital argument in favour of intervention is that morally, it makes sense. Liberia has been suffering from civil war for years, and it is among the poorest countries in the world. Liberia's long suffering people need intervention to prevent massive bloodshed. The costs versus the benefits would be quite favourable given the number of people who's lives could be saved by a small, but well-equiped intervention force, coupled with humanitarian assistance. An American intervention would likely be successful, especially since unlike many other places, the locals actually WANT them there. A disciplined, and well equiped intervention force could probably beat back the drugged up thugs of both the government and rebel armies.
Why shouldn't America intervene? In the short term, the main argument against intervention is that the situation is way to chaotic to act in a peacekeeping capacity. Also, what would be America's role? Would they be propping up the government? Really, America wants to see Charles Taylor go, so intervening could run counter the long-run interest of Liberians, who would be better off without him. The situation on the ground is very fluid, and ceasefire has been a joke. There is the potential for America's intervention force to get a bloody nose if they meet organised resistance from either the government or the rebels. America does not want to invade. Their role (as they hope) would be to bring security and calm by helping to enforce a ceasefire, and facilitating negociations. For all practical purposes, there will be no intervention without a voluntary ceasefire from both sides. The chance of a lasting ceasefire is fairly low at present, which decreases the likelyhood of American intervention.
Another argument against intervention is that America's interests are not at stake, and they don't need more military expenditure at this point. Paying for military intervention is like pissing on your tax money, and then burning it. Those costs are basically a black hole. Defence planners are already talking about over-extension. For America there would not seem to be any tangible gain from intervention. Liberia has little strategic value, and no strategic resources to keep secure (such as oil). The only gains from intervention would be diplomatic. America could demonstrate some compassion by intervening where their interests are not at stake. This could give them a bit more clout internationally, since America's influence has been changing with their new commitment to unilateralism.
So, should America intervene? My gut says they they should and beat back both sides to ensure humanitarian aid. On the other hand, they could be playing into the hands of Charles Taylor, who could conveniently stay in power, or manipulate things form behind the scenes. Really, Mr. Talyor should be indicted for crimes against humanity in the International Criminal Court. What would happen in Liberia if America did intervene? What if they could force Mr. Taylor out? Would they play the kingmaker in Liberia as well? The other thing is that, despite the moral ramifications, it make more practical sense to wait for some calm on the ground. This looks unlikely. Maybe the rebels can take the capital and oust Charles Taylor. What will happen then? God knows!
Wednesday, July 09, 2003
Does the US State Department need reform?
This entry is meant to be a reflection of the article entitled "Rogue State Department" by Newt Gingrich in the July/August edition of Foreign Policy. Reading the article will help make sense of what's in this entry.
Mr. Gingrich starts the article with an attempt to blame the ill will faced by America on the international level on the US State Department. I do not believe this is true though. As an outsider, I encounter the opinions of non-Americans all the time. Granted, much of the criticism heaped on America is unjustified, and downright ignorant. Most commonly, I hear people say that they have nothing against America or its people per se, they are only peeved at the policies of the American government. Take for example, the relationship between Canada and the United States. In the past few years, Canada/US relations have been strained by a number of rows over trade and foreign policy. American farm subsidies, steel tariffs, the softwood lumber trade dispute, the ban on the import of Canadian beef have all earned the ire of Canadians in one way or another. Let's be honest, is there ANYTHING that the US State Department could possibly do to make these measures palatable to Canadians? The example of Canada/US relations is a microcosm for America's relationship with the rest of the world. Non-Americans view the rhetoric out of the Washington through the lens of their own interest. The role of the US State Department seems to be to foster and improve relations with other countries. To fulfill this role, the diplomats in the department need to be non-ideological. Dogmatic ideology tends to impede pleasant relations between countries. "Process, Politeness and Accomodation" are part and parcel to fulfilling the State Department's role.
For a great caricature of the State Department's role, watch the Simpson's episode Bart vs. Australia, in which Bart's prank call leads him to be forced, by the State Department, to apologise to Australia for his disrespectful actions. A comparison could be made between the administration and the Simpsons. When Bart is to be booted, Homer is shocked by the use of corporal punishment, while the State Department representative urges him to respect "Australia's cultural tradition". This really goes to the heart of Mr. Gingrich's criticism of the State Department, which in his opinion seems to value accommodation over principle. Of course, the problem on the Simpsons' side (and perhaps the side of the American administration) is ignorance and insensitivity, while the problem on the State Department's side is the willingness to sacrifice values.
In my opinion, the main source of anger against America is the administrations's insensitivity towards the interests of other countries. I don't blame the administration for doing what is in America's best interest; after all, that is why it is there. If the administration wishes to foster better relations with other countries though, it must take the interests of those countries (or at least the governments of those countries) into account. On the most part though, these relations do not matter, and there is no way to make the ill sentiments of outsiders impact the administration. Only the sentiments of Americans matter because they vote, and outsiders do not. Furthermore, marginal votes are worth more than non-marginal votes. With America divided 50/50 in the last presidential election, the votes of swing voters such as farmers, steelworkers and timberworkers become much more valuable. This is why the administration, and politicians in general, must pander to these groups. Do the French elect the US President? Of course not. That is why their opinion does not matter to the administration.
Of course, the real issue in Mr. Gingrich's article is that the State Department is out of synch with the rest of the administration, and that some serious inertia has set in. Mr. Gingrich is probably right in that other countries receive mixed messages from the US State Department's diplomats and from the mouth of the administration. He is also probably right in saying that there is some serious inertia in the department. Like most government bureaucracies, the bureaucrats themselves work to protect their own turf and interests. Change is usually not welcome. This in and of itself is a good argument for reforming the State Department, and for Mr. Gingrich's plan of cycling its bureaucrats through other parts of the administration to give them perspective.
In this post Cold-War era, the greatest check against American ideologicalness - the Soviet Union, no longer exists. During the Cold War, America was forced to cooperate with its allies in Europe , and its proxies elsewhere, to achieve a common defence against Communism. Before the fall of the Berlin Wall, America could tolerate associating with unsavoury governments, and propping up tin-pot dictatorships. Without the spectre of a second superpower though, America's estwhile allies are much less useful. Is it any wonder that the ideologues are out in force in this administration? In some ways, the State Department is still stuck in Cold War mode. Mr. Gingrich makes a useful observation that with news available 24 hours a day, the nature of departmental communication needs to change to reflect the new environment. The ease and speed of information acquisition undoubtably introduces new challenges to the dissemination of policy statements by the administration and the State Department.
Would bringing the State Department more under the boot of the administration really help? Well, it would probably reduce the policy confusion between what it says, and what the administration says. On the other hand, it would be expected that the "new and improved" US State Department would mirror the ideological bent of the rest of the administration, much to the frustration of outsiders. Also, reforming the State Department would do nothing to eliminate the hypocracy of certain American policies that draw the ire of non-Americans.
In short, the State Department may need some significant reform, but not for the all the reasons that Mr. Gingrich states. He points to America's negative image abroad and blames it on State Department bungling. America's negative image is more a reflection of how far the differences between America and its allies are emphasised by critics, and how outsiders do not see common interest with the policies of the administration. The administration itself could use a hard dose of respect for the interests of other countries. Domestic interests too often (at least in the opinion of non-Americans) trump long-term foreign policy interests, which can result in policy confusion. Of course, what happens when one's foreign partners or enemies are ideological, such as Germany during the Iraq war controversy, or left-wing NGOs? Will any amount of reform in the State Department make a difference?
Perhaps, I can address this issue in more depth in future.
This entry is meant to be a reflection of the article entitled "Rogue State Department" by Newt Gingrich in the July/August edition of Foreign Policy. Reading the article will help make sense of what's in this entry.
Mr. Gingrich starts the article with an attempt to blame the ill will faced by America on the international level on the US State Department. I do not believe this is true though. As an outsider, I encounter the opinions of non-Americans all the time. Granted, much of the criticism heaped on America is unjustified, and downright ignorant. Most commonly, I hear people say that they have nothing against America or its people per se, they are only peeved at the policies of the American government. Take for example, the relationship between Canada and the United States. In the past few years, Canada/US relations have been strained by a number of rows over trade and foreign policy. American farm subsidies, steel tariffs, the softwood lumber trade dispute, the ban on the import of Canadian beef have all earned the ire of Canadians in one way or another. Let's be honest, is there ANYTHING that the US State Department could possibly do to make these measures palatable to Canadians? The example of Canada/US relations is a microcosm for America's relationship with the rest of the world. Non-Americans view the rhetoric out of the Washington through the lens of their own interest. The role of the US State Department seems to be to foster and improve relations with other countries. To fulfill this role, the diplomats in the department need to be non-ideological. Dogmatic ideology tends to impede pleasant relations between countries. "Process, Politeness and Accomodation" are part and parcel to fulfilling the State Department's role.
For a great caricature of the State Department's role, watch the Simpson's episode Bart vs. Australia, in which Bart's prank call leads him to be forced, by the State Department, to apologise to Australia for his disrespectful actions. A comparison could be made between the administration and the Simpsons. When Bart is to be booted, Homer is shocked by the use of corporal punishment, while the State Department representative urges him to respect "Australia's cultural tradition". This really goes to the heart of Mr. Gingrich's criticism of the State Department, which in his opinion seems to value accommodation over principle. Of course, the problem on the Simpsons' side (and perhaps the side of the American administration) is ignorance and insensitivity, while the problem on the State Department's side is the willingness to sacrifice values.
In my opinion, the main source of anger against America is the administrations's insensitivity towards the interests of other countries. I don't blame the administration for doing what is in America's best interest; after all, that is why it is there. If the administration wishes to foster better relations with other countries though, it must take the interests of those countries (or at least the governments of those countries) into account. On the most part though, these relations do not matter, and there is no way to make the ill sentiments of outsiders impact the administration. Only the sentiments of Americans matter because they vote, and outsiders do not. Furthermore, marginal votes are worth more than non-marginal votes. With America divided 50/50 in the last presidential election, the votes of swing voters such as farmers, steelworkers and timberworkers become much more valuable. This is why the administration, and politicians in general, must pander to these groups. Do the French elect the US President? Of course not. That is why their opinion does not matter to the administration.
Of course, the real issue in Mr. Gingrich's article is that the State Department is out of synch with the rest of the administration, and that some serious inertia has set in. Mr. Gingrich is probably right in that other countries receive mixed messages from the US State Department's diplomats and from the mouth of the administration. He is also probably right in saying that there is some serious inertia in the department. Like most government bureaucracies, the bureaucrats themselves work to protect their own turf and interests. Change is usually not welcome. This in and of itself is a good argument for reforming the State Department, and for Mr. Gingrich's plan of cycling its bureaucrats through other parts of the administration to give them perspective.
In this post Cold-War era, the greatest check against American ideologicalness - the Soviet Union, no longer exists. During the Cold War, America was forced to cooperate with its allies in Europe , and its proxies elsewhere, to achieve a common defence against Communism. Before the fall of the Berlin Wall, America could tolerate associating with unsavoury governments, and propping up tin-pot dictatorships. Without the spectre of a second superpower though, America's estwhile allies are much less useful. Is it any wonder that the ideologues are out in force in this administration? In some ways, the State Department is still stuck in Cold War mode. Mr. Gingrich makes a useful observation that with news available 24 hours a day, the nature of departmental communication needs to change to reflect the new environment. The ease and speed of information acquisition undoubtably introduces new challenges to the dissemination of policy statements by the administration and the State Department.
Would bringing the State Department more under the boot of the administration really help? Well, it would probably reduce the policy confusion between what it says, and what the administration says. On the other hand, it would be expected that the "new and improved" US State Department would mirror the ideological bent of the rest of the administration, much to the frustration of outsiders. Also, reforming the State Department would do nothing to eliminate the hypocracy of certain American policies that draw the ire of non-Americans.
In short, the State Department may need some significant reform, but not for the all the reasons that Mr. Gingrich states. He points to America's negative image abroad and blames it on State Department bungling. America's negative image is more a reflection of how far the differences between America and its allies are emphasised by critics, and how outsiders do not see common interest with the policies of the administration. The administration itself could use a hard dose of respect for the interests of other countries. Domestic interests too often (at least in the opinion of non-Americans) trump long-term foreign policy interests, which can result in policy confusion. Of course, what happens when one's foreign partners or enemies are ideological, such as Germany during the Iraq war controversy, or left-wing NGOs? Will any amount of reform in the State Department make a difference?
Perhaps, I can address this issue in more depth in future.
Friday, June 20, 2003
Iraq's Post War Settlement (or Lack Thereof)
Why can't America deliver on its promises in Iraq? Why was the war less than a month long, and two months later things have barely improved? Firstly let me say that my view has been skewed by the biased coverage delivered by just about every news agency. America's failure makes interesting news, so naturally, there's plenty of coverage. Of course, they can't be all wrong. Unfortunately, positive outcomes are rarely newsworthy.
Much as I hate to defend the Americans, sometimes it can be fun to play the devil's advocate. I'm hoping that this will outline some of the reasons why Iraq is still lawless, and some reasons why perhaps America should be given some slack (for now).
1) America's plan for the end game was not fully developed before the war
The old adage says, never count your chickens before they hatch. There was some talk of the post-war settlement from the administration prior to the war, but much of it came off as pre-war bluster. Perhaps some of it was. Some were urging the administration to make such plans before the war, while others were shocked by the arrogance of such talk since they believed that there would be a long war. WWII may provide some useful perspective on how to plan the end game, but let us recall that the allies had plenty of time in which to hash out their plans. None of the powers had post-war plans prior to the outbreak of war. In that sense, it's not so unusual that America's post-war plans have been so haphazard.
2) Bureaucratic Overlap and Competing Jurisdictions
Who is really in charge? America's civilian administrators or the military? Technically the administrators are in charge, but there must undoubtably be friction between the soldiers and the administrators. What about the body in charge of the reconstruction? How do they fit into the grand scheme of things? Perhaps Iraq should have been placed under the direct rule of a military proconsul. At least then one would know who's in charge.
3) Lack of money
America has committed considerable sums of money for the reconstruction of Iraq, though the provisional administration always seems to be short of cash. They need money to pay civil servants, and to administer public services. The problem is mostly that money is not finding its way to the right places at the right times. Going back to problem 2, it's not like the civilian adminstration in Iraq can appropriate military helicopters or transports for their use, at least not very easily. Without a functional banking system in Iraq, the problem is only exacerbated.
4) Failure to use local resources
In the rush to administer Iraq after the war, America has probably ignored a number of opportunities for confidence-building measures. This problem has a cultural dimension to it. American administrators are trying to do things in an American fashion. They are not thinking like Arabs, Iraqis, or Muslims. Why doesn't America cooperate more with Shia clerics? (Perhaps out of fear they they may seize political power) Right now, the clerics are providing the most visible source of order, albeit sometimes intolerant order. Aparently America would rather see chaos in Iraq rather than cleric-imposed order. Furthermore, America has failed to use residual institutions from Saddam's regime since they fired all the Ba'athist bureaucrats and dissolved the Iraqi military. While there is justification for this because of suspicion of disloyaly and collusion with the Saddam's remaining resistance. In any case, America could have made much better use of local institutions and resources.
5) Intrigue by foreign powers
Iran is probably the most guilty in this case. This is a bit of a conspiracy theory, but it is believed that Iran's Ayatollahs control certain factions within the Shia population in Iraq, and have been using their influence to stymie America's efforts.
6) Remnants of the Old Regime
Saddam Hussein and his cronies had a lot of time to come up with a contingency plan for if and when they would be ousted. Undoubtably this is why Saddam has not been found. Part of such a contingency plan probably included plans to stymie the post-war settlement, and to set the scene for the return of the old regime.
7) Short Attention-Span
With the war over, Americans can go back to focusing on other things and let the administrators deal with things. Without the attention of the media, or at least diminished attention, the process of the post war-settlement can get away with moving slowly. The Bush administration itself is largly ignoring developments in Iraq except for the odd sound-bite indicating the capture of some member of Saddam's regime. The administration has moved Iraq to a lower priority since the war ended.
8) Unrealistic Expectations
This applies not to the administration in Iraq or in the White House (though I'm certain that the argument could be made). I'm talking about us, the armchair administrators. We're free to criticize all we want without knowing a thing about what's happening on the ground in Iraq. Two months after the war ended, many expected Iraq to be far along the road to recovery. The only reason that Iraq's situation seems bad is because we expect the situation to get better immediately. I would contend that our belief in a fast reconstruction is not based on empirical experience, or any logic at all. We have no reason to believe that Iraq's situation can be dramatically improved in two months. It's easy to have such expectations because we are, on the most part, ignorant of the actual situation, and we have no sense of the difficulty of establishing a new government in a country that presently lacks one, and no party is strong enough to impose itself (especially since the Americans do not want impose because that would seem like imperialism). There are some bases for comparison such as Japan after WWII. However, that reconstration took a considerable amount of time, much more than 2 months.
So, let us all be a bit more patient and try to make our expectations more realistic. I would also ask, could any other country do any better? Before rushing to criticise America, please consider whether anyone else could do any better. Could you if you were in charge? Everyone likes to think yes, but the answer is probably no. Many a country has a good repuation with regards to development, and development projects, but few have every had the obligation to create a new regime. So please, cut back on the vociferous criticism if you can't prove that you could do any better.
Why can't America deliver on its promises in Iraq? Why was the war less than a month long, and two months later things have barely improved? Firstly let me say that my view has been skewed by the biased coverage delivered by just about every news agency. America's failure makes interesting news, so naturally, there's plenty of coverage. Of course, they can't be all wrong. Unfortunately, positive outcomes are rarely newsworthy.
Much as I hate to defend the Americans, sometimes it can be fun to play the devil's advocate. I'm hoping that this will outline some of the reasons why Iraq is still lawless, and some reasons why perhaps America should be given some slack (for now).
1) America's plan for the end game was not fully developed before the war
The old adage says, never count your chickens before they hatch. There was some talk of the post-war settlement from the administration prior to the war, but much of it came off as pre-war bluster. Perhaps some of it was. Some were urging the administration to make such plans before the war, while others were shocked by the arrogance of such talk since they believed that there would be a long war. WWII may provide some useful perspective on how to plan the end game, but let us recall that the allies had plenty of time in which to hash out their plans. None of the powers had post-war plans prior to the outbreak of war. In that sense, it's not so unusual that America's post-war plans have been so haphazard.
2) Bureaucratic Overlap and Competing Jurisdictions
Who is really in charge? America's civilian administrators or the military? Technically the administrators are in charge, but there must undoubtably be friction between the soldiers and the administrators. What about the body in charge of the reconstruction? How do they fit into the grand scheme of things? Perhaps Iraq should have been placed under the direct rule of a military proconsul. At least then one would know who's in charge.
3) Lack of money
America has committed considerable sums of money for the reconstruction of Iraq, though the provisional administration always seems to be short of cash. They need money to pay civil servants, and to administer public services. The problem is mostly that money is not finding its way to the right places at the right times. Going back to problem 2, it's not like the civilian adminstration in Iraq can appropriate military helicopters or transports for their use, at least not very easily. Without a functional banking system in Iraq, the problem is only exacerbated.
4) Failure to use local resources
In the rush to administer Iraq after the war, America has probably ignored a number of opportunities for confidence-building measures. This problem has a cultural dimension to it. American administrators are trying to do things in an American fashion. They are not thinking like Arabs, Iraqis, or Muslims. Why doesn't America cooperate more with Shia clerics? (Perhaps out of fear they they may seize political power) Right now, the clerics are providing the most visible source of order, albeit sometimes intolerant order. Aparently America would rather see chaos in Iraq rather than cleric-imposed order. Furthermore, America has failed to use residual institutions from Saddam's regime since they fired all the Ba'athist bureaucrats and dissolved the Iraqi military. While there is justification for this because of suspicion of disloyaly and collusion with the Saddam's remaining resistance. In any case, America could have made much better use of local institutions and resources.
5) Intrigue by foreign powers
Iran is probably the most guilty in this case. This is a bit of a conspiracy theory, but it is believed that Iran's Ayatollahs control certain factions within the Shia population in Iraq, and have been using their influence to stymie America's efforts.
6) Remnants of the Old Regime
Saddam Hussein and his cronies had a lot of time to come up with a contingency plan for if and when they would be ousted. Undoubtably this is why Saddam has not been found. Part of such a contingency plan probably included plans to stymie the post-war settlement, and to set the scene for the return of the old regime.
7) Short Attention-Span
With the war over, Americans can go back to focusing on other things and let the administrators deal with things. Without the attention of the media, or at least diminished attention, the process of the post war-settlement can get away with moving slowly. The Bush administration itself is largly ignoring developments in Iraq except for the odd sound-bite indicating the capture of some member of Saddam's regime. The administration has moved Iraq to a lower priority since the war ended.
8) Unrealistic Expectations
This applies not to the administration in Iraq or in the White House (though I'm certain that the argument could be made). I'm talking about us, the armchair administrators. We're free to criticize all we want without knowing a thing about what's happening on the ground in Iraq. Two months after the war ended, many expected Iraq to be far along the road to recovery. The only reason that Iraq's situation seems bad is because we expect the situation to get better immediately. I would contend that our belief in a fast reconstruction is not based on empirical experience, or any logic at all. We have no reason to believe that Iraq's situation can be dramatically improved in two months. It's easy to have such expectations because we are, on the most part, ignorant of the actual situation, and we have no sense of the difficulty of establishing a new government in a country that presently lacks one, and no party is strong enough to impose itself (especially since the Americans do not want impose because that would seem like imperialism). There are some bases for comparison such as Japan after WWII. However, that reconstration took a considerable amount of time, much more than 2 months.
So, let us all be a bit more patient and try to make our expectations more realistic. I would also ask, could any other country do any better? Before rushing to criticise America, please consider whether anyone else could do any better. Could you if you were in charge? Everyone likes to think yes, but the answer is probably no. Many a country has a good repuation with regards to development, and development projects, but few have every had the obligation to create a new regime. So please, cut back on the vociferous criticism if you can't prove that you could do any better.
Thursday, May 29, 2003
The Maturity of the Environmental Movement
Before I start, I must first of all claim that I have no real first hand knowledge of the environmental movement. This blog entry is merely an expression of my observations and experiences. I have no credentials to back any of my statements beyond the fact that I have lived in this contemporary North American culture since the early 1980s. That in mind, please remember that this is all an expression of opinion.
Why do I prefix my blog entry with a badly formed disclaimer? It is my observation that discussions about environmental protection and policy arouse strong emotions. Readers may get the wrong impression of me as if I am some sort of authority on the subject, which I am not.
First of all, I would like to say that I grew up with environmentalism. We all did, at least those in my generation. We were socialised in school to care about issues like "the rainforest", ozone depletion, recycling, and other major environmental causes. In a sense, we are all environmentalists now, at least by the standards of where the movement was when I was a child. Now, I doubt that I can claim to be an environmentalist, and that does bother me. To be branded as not an environmentalist implies that I do not care about the environment, and that I must be a stooge of the coporate mainstream. It doesn't help that I'm studying business administration. For the record though, I do care about the environment and environmental issues, but I'm no hardcore firebrand corporate basher.
Why am I bringing up this issue? Well, tonight I watched en episode of South Park (don't laugh, I'm serious) that caricatured the environmental movement in several humourous, and perhaps unjustified ways. You can read the script of the episode here (don't forget to say no to the nasty software download). In celebration of Earth Day, the Earth Day Brainwashing Organisation is hosting the Earth Day Brainwashing Festival in South Park. The organisers were forcing the grade 4 class to help set up the venue for the festival. Later to scare Kyle, Cartman, Stan and Kenny into following on what they had promised to do, the organisers started hacking off Kenny's limbs with a cleaver. In my opinion, this was going a bit far. In any case, the environmental movement is caricatured in the episode as brainwashing people, exploiting children to achieve their ends, and valuing the environment over human life. On the surface, there is no justification for this, though I believe this demonstrates something about environmentalism. The movement has matured. People are now more willing to criticise the movement, though most such critics remain at the fringes, or are part of right-wing political parties. Even then, many people on the right wing have accepted the core idea that the environment in which we live cannot be taken for granted. Does the environmental brainwash? Well no more so than any other lobbying group that runs publicity in the media. Does the environmental movement emxploit children? Well, exploiting children as manual labour is going a bit far, but much of the publicity (some might call propaganda) about environmentalism is tailored for children. The fact is that many of us grew up being socialised to think a certain way on environmental issues. Does the environmental movement value the environment over human life? That's debatable, though in my opinion, some environmentalists value the environment over human welfare (from an ecnonomics perspective).
I don't know the history of the environmental movement. In my opinion though, it has achieved a certain level of maturity. I believe that the environmental movement, as we know it today was born in the 1960s. Since then it has moved from a fringe movement to mainstream. Despite claims by its adherents to the contrary, environmentalism is mainstream, and it has matured. In some ways, environmentalism is like a religion, though much less centralised. The aim of environmentalism is the salvation of the earth, and its inhabitants. The Christianity is the salvation of humanity. Environmentalism can be dogmatic, though no central authority dictates what the environmental doctrine is. Environmental dogma is developed by the researchers that study environmental science. Religious dogma has tended to be developed by researchers that study theology. Environmentalists use guilt to change people's behaviour and achieve the aims of the environmental movement. Some may accuse the Catholic church of the same thing. Proponents of environmentalism have demonstrated the will to punish members of the movement that do not follow the dogma (such as Bjorn Lomborg, writer of The Sceptical Environmentalist). Do I even need to mention excommunication?
While the comparison between environmentalism and religion is amusing, it doesn't really demonstrate the maturity of the environmental movement. Let me try to set out some anecdotal evidence. The focus of environmentalism when I was in grade school seemed to be preservation. We needed to save the pandas, the whales, the white rhino, the elephants, and all the other highly visible animal species. There was also a focus on conservation of resources such as water, minerals, forests, and energy. This led to another focus: pollution reduction. Today, the focus is no just on individual species, but the entire biomass and its diversity. The focus on conservation and pollution reduction still holds, but new foci have been added such as the push to reduce carbon emissions, and sustainable development. This doesn't really demonstrate maturity, but it does show that the scope of the movement has increased from species-specific action to a more wholistic view of the entire biomass. Is the movement suffering from inertia though? If that were true, then the movement would definately be mature. Inertia (roughly speaking) is a state of an organisation in which decisions tend to follow those made historically with little deviation, and is demonstrated by an inability to innovate. This is difficult to prove. I'm afraid that I do not know enough about the environmental movement to make this case. I would like to point out a divergence in the movement though. A core group of environmentalists continues as always with the same anti-business, anti-industrial, historical view. Others are exploring the possibilities of working with business to achieve what environmental protection they can. In some ways this is similar to the split between communists and social democrats. The social democrats couldn't wait for some messianic revolution, and took to promulgating their policies through the ballot-box. This new wing of the environmental movement involves not just scientists and activists, but also economists and policy experts. I think of these people more as resource and environment managers. They seek to find out what policies by governments and businesses can ensure proper management of the environment.
I believe another issue with regards to the maturity of the movement is that now has a number of victories under its belt. Unfortunately, these tend to be overlooked as the focus is placed on unresolved environmental issues. Furthermore, old views tend to continue to be expressed long after the issue has passed. For example, the Montreal Accord of 1987 has signed by 43 countries, and its aim was to eliminate the use of Ozone-depleting CFCs. 16 years later, we see that this was pretty much a success. Despite lingering misinformation to the contrary, CFCs have largely disappeared as an issue. CFCs are no longer suppsed to be used in aerosol containers, air conditioners or refridgeration units. The whole in the ozone layer, to the best of my knowledge is slowly getting smaller. On a much smaller scale, environmentalists successfuly pushed for polution reduction in North America's great lakes. I don't know the actual state of affairs, but as far as I know, the conditions in the great lakes have been imrpoving. I think that PCB, dioxin and heavy metal concentration levels have been dropping. The issue of acid rain has diminished as it has been (as far as I know) proven to be less harmful than it was feared. The acidification of northern Ontario's lakes has been combatted.
So what is the future of the environmental movement? This is all just speculation, but since I believe that the movement has matured, I expect some amount of inertia. The activists will continue their present tactics for better of for worse. Perhaps some discreditation will come their way (if that has not already happened. In any case, I expect that environmenal issues, some of them at least, will become more open for debate, and less black ane white as many are placed now. I'm glad that there has been debate about the Kyoto Protocol. While agitation will continue, energy production will slowly become more efficient. Industrial processes will be tweaked, and perhaps redesigned to reduce waste. Ultimately, technology and increased efficiency will ensure salvation from climate change, not reducing production (and human welfare by extension). In the rush to achieve a hydrogen society (a pipe dream perhaps), it is important to not ignore incremental changes with regards to internal combustion. Increasing fuel efficiency is an important step. Dreamers may think that fuel cells can be adopted overnight, but that is not true. The right incentives must be available to coax people into the right decision. Also, expect big oil, to remain big oil. Hydrogen will probably be more easily and cheaply acquired from hydrocarbons than solar-powered electrolysis. That said, expect dirty energy to linger. Coal will continue to be important as new technology makes it cleaner. As fewer people use coal, the price will fall, which will keep it competitive. I guess I can sum it all up by saying, the more things change, the more they stay the same.
Whew! There are many unresolved issues. Like everything else I say, I hope to revisit this.
Comments? E-mail me at icy_caina@nospamhere.yahoo.ca (remove nospamhere if you want to reach me).
Before I start, I must first of all claim that I have no real first hand knowledge of the environmental movement. This blog entry is merely an expression of my observations and experiences. I have no credentials to back any of my statements beyond the fact that I have lived in this contemporary North American culture since the early 1980s. That in mind, please remember that this is all an expression of opinion.
Why do I prefix my blog entry with a badly formed disclaimer? It is my observation that discussions about environmental protection and policy arouse strong emotions. Readers may get the wrong impression of me as if I am some sort of authority on the subject, which I am not.
First of all, I would like to say that I grew up with environmentalism. We all did, at least those in my generation. We were socialised in school to care about issues like "the rainforest", ozone depletion, recycling, and other major environmental causes. In a sense, we are all environmentalists now, at least by the standards of where the movement was when I was a child. Now, I doubt that I can claim to be an environmentalist, and that does bother me. To be branded as not an environmentalist implies that I do not care about the environment, and that I must be a stooge of the coporate mainstream. It doesn't help that I'm studying business administration. For the record though, I do care about the environment and environmental issues, but I'm no hardcore firebrand corporate basher.
Why am I bringing up this issue? Well, tonight I watched en episode of South Park (don't laugh, I'm serious) that caricatured the environmental movement in several humourous, and perhaps unjustified ways. You can read the script of the episode here (don't forget to say no to the nasty software download). In celebration of Earth Day, the Earth Day Brainwashing Organisation is hosting the Earth Day Brainwashing Festival in South Park. The organisers were forcing the grade 4 class to help set up the venue for the festival. Later to scare Kyle, Cartman, Stan and Kenny into following on what they had promised to do, the organisers started hacking off Kenny's limbs with a cleaver. In my opinion, this was going a bit far. In any case, the environmental movement is caricatured in the episode as brainwashing people, exploiting children to achieve their ends, and valuing the environment over human life. On the surface, there is no justification for this, though I believe this demonstrates something about environmentalism. The movement has matured. People are now more willing to criticise the movement, though most such critics remain at the fringes, or are part of right-wing political parties. Even then, many people on the right wing have accepted the core idea that the environment in which we live cannot be taken for granted. Does the environmental brainwash? Well no more so than any other lobbying group that runs publicity in the media. Does the environmental movement emxploit children? Well, exploiting children as manual labour is going a bit far, but much of the publicity (some might call propaganda) about environmentalism is tailored for children. The fact is that many of us grew up being socialised to think a certain way on environmental issues. Does the environmental movement value the environment over human life? That's debatable, though in my opinion, some environmentalists value the environment over human welfare (from an ecnonomics perspective).
I don't know the history of the environmental movement. In my opinion though, it has achieved a certain level of maturity. I believe that the environmental movement, as we know it today was born in the 1960s. Since then it has moved from a fringe movement to mainstream. Despite claims by its adherents to the contrary, environmentalism is mainstream, and it has matured. In some ways, environmentalism is like a religion, though much less centralised. The aim of environmentalism is the salvation of the earth, and its inhabitants. The Christianity is the salvation of humanity. Environmentalism can be dogmatic, though no central authority dictates what the environmental doctrine is. Environmental dogma is developed by the researchers that study environmental science. Religious dogma has tended to be developed by researchers that study theology. Environmentalists use guilt to change people's behaviour and achieve the aims of the environmental movement. Some may accuse the Catholic church of the same thing. Proponents of environmentalism have demonstrated the will to punish members of the movement that do not follow the dogma (such as Bjorn Lomborg, writer of The Sceptical Environmentalist). Do I even need to mention excommunication?
While the comparison between environmentalism and religion is amusing, it doesn't really demonstrate the maturity of the environmental movement. Let me try to set out some anecdotal evidence. The focus of environmentalism when I was in grade school seemed to be preservation. We needed to save the pandas, the whales, the white rhino, the elephants, and all the other highly visible animal species. There was also a focus on conservation of resources such as water, minerals, forests, and energy. This led to another focus: pollution reduction. Today, the focus is no just on individual species, but the entire biomass and its diversity. The focus on conservation and pollution reduction still holds, but new foci have been added such as the push to reduce carbon emissions, and sustainable development. This doesn't really demonstrate maturity, but it does show that the scope of the movement has increased from species-specific action to a more wholistic view of the entire biomass. Is the movement suffering from inertia though? If that were true, then the movement would definately be mature. Inertia (roughly speaking) is a state of an organisation in which decisions tend to follow those made historically with little deviation, and is demonstrated by an inability to innovate. This is difficult to prove. I'm afraid that I do not know enough about the environmental movement to make this case. I would like to point out a divergence in the movement though. A core group of environmentalists continues as always with the same anti-business, anti-industrial, historical view. Others are exploring the possibilities of working with business to achieve what environmental protection they can. In some ways this is similar to the split between communists and social democrats. The social democrats couldn't wait for some messianic revolution, and took to promulgating their policies through the ballot-box. This new wing of the environmental movement involves not just scientists and activists, but also economists and policy experts. I think of these people more as resource and environment managers. They seek to find out what policies by governments and businesses can ensure proper management of the environment.
I believe another issue with regards to the maturity of the movement is that now has a number of victories under its belt. Unfortunately, these tend to be overlooked as the focus is placed on unresolved environmental issues. Furthermore, old views tend to continue to be expressed long after the issue has passed. For example, the Montreal Accord of 1987 has signed by 43 countries, and its aim was to eliminate the use of Ozone-depleting CFCs. 16 years later, we see that this was pretty much a success. Despite lingering misinformation to the contrary, CFCs have largely disappeared as an issue. CFCs are no longer suppsed to be used in aerosol containers, air conditioners or refridgeration units. The whole in the ozone layer, to the best of my knowledge is slowly getting smaller. On a much smaller scale, environmentalists successfuly pushed for polution reduction in North America's great lakes. I don't know the actual state of affairs, but as far as I know, the conditions in the great lakes have been imrpoving. I think that PCB, dioxin and heavy metal concentration levels have been dropping. The issue of acid rain has diminished as it has been (as far as I know) proven to be less harmful than it was feared. The acidification of northern Ontario's lakes has been combatted.
So what is the future of the environmental movement? This is all just speculation, but since I believe that the movement has matured, I expect some amount of inertia. The activists will continue their present tactics for better of for worse. Perhaps some discreditation will come their way (if that has not already happened. In any case, I expect that environmenal issues, some of them at least, will become more open for debate, and less black ane white as many are placed now. I'm glad that there has been debate about the Kyoto Protocol. While agitation will continue, energy production will slowly become more efficient. Industrial processes will be tweaked, and perhaps redesigned to reduce waste. Ultimately, technology and increased efficiency will ensure salvation from climate change, not reducing production (and human welfare by extension). In the rush to achieve a hydrogen society (a pipe dream perhaps), it is important to not ignore incremental changes with regards to internal combustion. Increasing fuel efficiency is an important step. Dreamers may think that fuel cells can be adopted overnight, but that is not true. The right incentives must be available to coax people into the right decision. Also, expect big oil, to remain big oil. Hydrogen will probably be more easily and cheaply acquired from hydrocarbons than solar-powered electrolysis. That said, expect dirty energy to linger. Coal will continue to be important as new technology makes it cleaner. As fewer people use coal, the price will fall, which will keep it competitive. I guess I can sum it all up by saying, the more things change, the more they stay the same.
Whew! There are many unresolved issues. Like everything else I say, I hope to revisit this.
Comments? E-mail me at icy_caina@nospamhere.yahoo.ca (remove nospamhere if you want to reach me).
Friday, May 23, 2003
Iraqi Oil: the controversial black stuff
So now the UN Security Council has given approval to the coalition's occupation of Iraq. Let's not kid ourselves, it is an occupation. Though, I mean that with as little negative connotation as possible. It is in any case, an occupation that is sorely needed, and the coalition's responsibility under international law. As the occupying power, the coalition has an obligation to care for the Iraqis. To some, the occupation looks like an attempt by America to control Iraq's oil supply. I won't deny that oil played a part in America's decision to go to war. It is true that America wouldn't mind busting up OPEC if that were possible. I don't believe that America is in Iraq to plunder oil though. What is important for the future of Iraq with regards to oil is to make sure that whatever fills the vacuum (whether it be a monopoly, or a panoply of firms) in the management of Iraq's hydrocarbons, not be directly controlled by the state. Oil should not be used to fund the wishes of the ruling party, as it did for at least three decades.
The best suggestions that I've heard for the management of Iraq's oil is for a trust with an independent board of directors be set up to collect royalties from the firms that actually manage the oil recovery. The money could then be distributed to the public on an equitable basis. When communism collapsed in Russia, a number of public oil firms emerged. The shares for these firms were widely distributed, but what ended up happening was that most of the shares went the market almost immediately as the poor went and cashed in below the true value of the shares, which were then bought up by the wealthy and influential. This in turn has probably only exacerabted inequality in Russia. This scenario should be avoided in Iraq. Also, private firms should probably not be allowed to own oilfields directly. The problem with oil is that it is quite comparable to the fishing industry (and it's pretty well publicised what has happened to fish stocks). Ownership of oil is established throgh the rule of capture. He who pumps the oil can claim ownership of it. This creates an incentive for all participants to pump as much oil as possible with the hopes ot pumping it all out before their competitors do so.
Oil could probably be administered in a similar way to which forests are managed (at least in Canada). Forests suffer from the same rule of capture incentive. Thus, the governments lease large sections of forest to logging companies for incredibly long-term leases. This creates an incentive for the company to reseed the clearcut areas of perform more selective cutting. Logging companies, in addition to paying for the lease, have to pay a royalty to the government in the form of a stumpage fee for each tree cut. This creates an incentive to use the tree resources efficiently, with as little waste as possible, after all, cutting trees and only getting a few boards out of it is just a plain waste. Unfortunately, it does create an incentive to cut the biggest trees possible, because they offer the most wood for ths stumpage fee. Perhaps, logging companies should be charged by the amount of volume cut... Anyways, back to oil...
Iraq's oil resources could be managed in a similar way. Oil companies should bid for long-term leases to Iraq's oilfields, which would give them an incentive to manage the rate of extraction carefully, rather than pump as much as possible, as fast as possible. The companies would then pay a royalty on the basis of volume of oil pumped, into a trust fund for the Iraqi people, administered by an independent board. Nevertheless, this plan is very controversial. Many would balk at the idea of giving oil companies 25 or 50-year leases to a country's oil-fields. Let us examine the alternatives though. A government-owned oil company would have the advantage of being able to strategically manage the country's oil resources as a whole. However, such a firm would be vulnerable to government meddling, political influence, and would have the potential to be used as a slush fund (ahem, Jacques Chirac and Elf-Aquitaine). The main function of such a company would be to raise money for the tax-shy public, which would create an incentive to pump as much as possible as fast as possible. Another alternative would be for individual firms to own oil-fields directly. As it has already been shown this creates an incentive to suck up as much oil as possible, then dump the land. A similar situation would result from short-term spot transactions with regards to oil-field leases. If firms had to bid each year for the privilege of pumping Iraq's oil, the incentive would be to pump as fast as possible during each firm's tenure. There would also be little reason for a firm to set up shop in the first place because their lease would be up in a year or two, which is insufficient to get an adequate return on investment. If there is imperfect competition though, the Iraqi people/government could be placed in a weak bargaining position because oil fields have little other use except as oil fields. Because of the specialised nature of the assets, the oil firms could bargain down the terms of their rent/lease and extract quasi-rents (the difference between the present value of the contract and the value of the contract under its next best alternative) from the government. In my opinion, the optimal solution is to have long-term leases that lock in the oil companies in the long term. Of course, it is important that the Iraqi government not reneg on its end of the deal by attempting to nationalise the oil company and its assets.
So where does that put America and the "coalition of the willing"? So far no one really knows what will happen. The UN is phasing out the Oil-for-Food Program,and placing Iraq and its oil under coalition cum America's jurisdiction. Will America make the optimal choice? Only time will tell. So far, the picture is mixed. President Bush has talked about holding repudiating Saddam's oil contracts (mostly with Russia and France) and holding fair auctions for the new oil contracts. For some reason, this reminds me of ancient Rome's publicani: tax farmers. The system worked like this: there were a number of tax-farming firms, which would promise to pay the republican government a certain bundle of denarii to tax a province. The publicani would then try to collect at least that much money in taxes from the chosen province, and any excess would be profit for the firm. The auctions for these firms were held every five years with the election of a two new Censors. This got out of control really fast, as the republican government kept raising the ante for its wealthiest provinces. Eventually, the bar was raised so high, that not even the publicani could raise enough denarii through their rapacious taxation methods to pay for the contracts. As a result every side lost (especially the taxpayers of the province).
Fortunately, in the present situation, America's tenure of control of Iraq should be relatively short. The oil firms that will bid will probably only get short-term contracts (unfortunately), as undoubtably the new Iraqi administration will be eager to run its own oil contract auction. While the auctions are inevitble (and they are the optimal way of determining the price paid and received), what is sad is that the oil companies will get only short term contracts, will be prone to government meddling, and the situation will be totally contrary to the interests of the Iraqi people. The best solution for them would be to ensure a steady stream of income from their oil as it is extracted gradually over a long period of time. Some renegociation should be possible to take changes in economic conditions into account, but on the whole, there should be no move towards a short-term spot transaction system. Once again, the best solution I've seen would charge the oil firms involved a royalty on a per unit of volume pumped basis. The money from the lease and royalties could then dumped into a trust fund for the Iraqi people and provide an equitable payout in the form of allowances/stipends, or better yet, a combination of health and education allowances and pensions.
So now the UN Security Council has given approval to the coalition's occupation of Iraq. Let's not kid ourselves, it is an occupation. Though, I mean that with as little negative connotation as possible. It is in any case, an occupation that is sorely needed, and the coalition's responsibility under international law. As the occupying power, the coalition has an obligation to care for the Iraqis. To some, the occupation looks like an attempt by America to control Iraq's oil supply. I won't deny that oil played a part in America's decision to go to war. It is true that America wouldn't mind busting up OPEC if that were possible. I don't believe that America is in Iraq to plunder oil though. What is important for the future of Iraq with regards to oil is to make sure that whatever fills the vacuum (whether it be a monopoly, or a panoply of firms) in the management of Iraq's hydrocarbons, not be directly controlled by the state. Oil should not be used to fund the wishes of the ruling party, as it did for at least three decades.
The best suggestions that I've heard for the management of Iraq's oil is for a trust with an independent board of directors be set up to collect royalties from the firms that actually manage the oil recovery. The money could then be distributed to the public on an equitable basis. When communism collapsed in Russia, a number of public oil firms emerged. The shares for these firms were widely distributed, but what ended up happening was that most of the shares went the market almost immediately as the poor went and cashed in below the true value of the shares, which were then bought up by the wealthy and influential. This in turn has probably only exacerabted inequality in Russia. This scenario should be avoided in Iraq. Also, private firms should probably not be allowed to own oilfields directly. The problem with oil is that it is quite comparable to the fishing industry (and it's pretty well publicised what has happened to fish stocks). Ownership of oil is established throgh the rule of capture. He who pumps the oil can claim ownership of it. This creates an incentive for all participants to pump as much oil as possible with the hopes ot pumping it all out before their competitors do so.
Oil could probably be administered in a similar way to which forests are managed (at least in Canada). Forests suffer from the same rule of capture incentive. Thus, the governments lease large sections of forest to logging companies for incredibly long-term leases. This creates an incentive for the company to reseed the clearcut areas of perform more selective cutting. Logging companies, in addition to paying for the lease, have to pay a royalty to the government in the form of a stumpage fee for each tree cut. This creates an incentive to use the tree resources efficiently, with as little waste as possible, after all, cutting trees and only getting a few boards out of it is just a plain waste. Unfortunately, it does create an incentive to cut the biggest trees possible, because they offer the most wood for ths stumpage fee. Perhaps, logging companies should be charged by the amount of volume cut... Anyways, back to oil...
Iraq's oil resources could be managed in a similar way. Oil companies should bid for long-term leases to Iraq's oilfields, which would give them an incentive to manage the rate of extraction carefully, rather than pump as much as possible, as fast as possible. The companies would then pay a royalty on the basis of volume of oil pumped, into a trust fund for the Iraqi people, administered by an independent board. Nevertheless, this plan is very controversial. Many would balk at the idea of giving oil companies 25 or 50-year leases to a country's oil-fields. Let us examine the alternatives though. A government-owned oil company would have the advantage of being able to strategically manage the country's oil resources as a whole. However, such a firm would be vulnerable to government meddling, political influence, and would have the potential to be used as a slush fund (ahem, Jacques Chirac and Elf-Aquitaine). The main function of such a company would be to raise money for the tax-shy public, which would create an incentive to pump as much as possible as fast as possible. Another alternative would be for individual firms to own oil-fields directly. As it has already been shown this creates an incentive to suck up as much oil as possible, then dump the land. A similar situation would result from short-term spot transactions with regards to oil-field leases. If firms had to bid each year for the privilege of pumping Iraq's oil, the incentive would be to pump as fast as possible during each firm's tenure. There would also be little reason for a firm to set up shop in the first place because their lease would be up in a year or two, which is insufficient to get an adequate return on investment. If there is imperfect competition though, the Iraqi people/government could be placed in a weak bargaining position because oil fields have little other use except as oil fields. Because of the specialised nature of the assets, the oil firms could bargain down the terms of their rent/lease and extract quasi-rents (the difference between the present value of the contract and the value of the contract under its next best alternative) from the government. In my opinion, the optimal solution is to have long-term leases that lock in the oil companies in the long term. Of course, it is important that the Iraqi government not reneg on its end of the deal by attempting to nationalise the oil company and its assets.
So where does that put America and the "coalition of the willing"? So far no one really knows what will happen. The UN is phasing out the Oil-for-Food Program,and placing Iraq and its oil under coalition cum America's jurisdiction. Will America make the optimal choice? Only time will tell. So far, the picture is mixed. President Bush has talked about holding repudiating Saddam's oil contracts (mostly with Russia and France) and holding fair auctions for the new oil contracts. For some reason, this reminds me of ancient Rome's publicani: tax farmers. The system worked like this: there were a number of tax-farming firms, which would promise to pay the republican government a certain bundle of denarii to tax a province. The publicani would then try to collect at least that much money in taxes from the chosen province, and any excess would be profit for the firm. The auctions for these firms were held every five years with the election of a two new Censors. This got out of control really fast, as the republican government kept raising the ante for its wealthiest provinces. Eventually, the bar was raised so high, that not even the publicani could raise enough denarii through their rapacious taxation methods to pay for the contracts. As a result every side lost (especially the taxpayers of the province).
Fortunately, in the present situation, America's tenure of control of Iraq should be relatively short. The oil firms that will bid will probably only get short-term contracts (unfortunately), as undoubtably the new Iraqi administration will be eager to run its own oil contract auction. While the auctions are inevitble (and they are the optimal way of determining the price paid and received), what is sad is that the oil companies will get only short term contracts, will be prone to government meddling, and the situation will be totally contrary to the interests of the Iraqi people. The best solution for them would be to ensure a steady stream of income from their oil as it is extracted gradually over a long period of time. Some renegociation should be possible to take changes in economic conditions into account, but on the whole, there should be no move towards a short-term spot transaction system. Once again, the best solution I've seen would charge the oil firms involved a royalty on a per unit of volume pumped basis. The money from the lease and royalties could then dumped into a trust fund for the Iraqi people and provide an equitable payout in the form of allowances/stipends, or better yet, a combination of health and education allowances and pensions.
Saturday, May 17, 2003
NMD: Threat to Canadian Sovereignty? Or a Great Opportunity?
I will admit that my view on this subject has changed from when I first heard about it. Initially, my reaction to the prospect of America's National Missile Defence was to label it as the "son of Star Wars" and to criticise the administration for rocking the boat of international balance of power. I think I know why my view changed though. For this, I can thank North Korea. I'm afraid that I have difficulty viewing this issue with much clarity. In any case, North Korea is a separate issue. To be brief, my view on NMD changed because of the North Koreans apparent attempts at blackmailing the international community, specifically the United States. So in the end, I've come out in mild support of North American Missile Defence.
Firstly, I would like to say that Canada and the United States have a long history of defensive cooperation. This only made sense because our mutual border is the longest undefended border in the world. Despite our differences, Canadians and Americans have so much in common. Unfortunately, this is usually ignored. I have two major arguments to make in support of North American Missile Defence. First is the threat of proliferation. Second is the free-rider issue and national responsiblity.
Why is proliferation a problem? Is containment always an option for dealing with rogue states? These questions are interconnected, and are fundamental regarding nations such as North Korea and pre-war Iraq. Proliferation is a major problem. Obviously I'm not talking about the international small arms trade, a deplorabale trade that may be. People may be able to brush off the threat posed by weapons of mass destruction (WMD), since no leader in their right mind would ever consider using one, right? Are we willing to take that chance? (There's nothing quite like answering a rhetorical question with an equally rhetorical question.) I personally believe that most people are deluded to the actual threat that WMDs pose. The real risk that such weapons impose on the world is that certain unscrupulous nations will use the threat of such weapons to coerce their citizens (consider pre-war Iraq) or other nations (consider North Korea) into doing what they want. Of course there's the concomitant risk that they will get used, but I believe that we can safely assume that both parties (particularly the weaker one: the one without a deterrent) will do everything possible to prevent the use of WMDs (such as concede in the face of demands). This is one reason why the United States wants to build the national missile defence.
Despite international treaties such as NPT, proliferation of atomic and missile technology has continued. It is pretty well accepted that North Korea traded its missile technlogy with Pakistan (prior to the coup of Pervez Musharraf) in exchange for aid in its nuclear program (probably uranium enrichment). North Korea has shown that is it willing to to sell its missile technology to the highest bidder. It is naive to think that international treaties alone can stop proliferation, especially given the half-hearted commitment of many nations to the cause. What about individuals or groups? Personally, I don't pay too much heed to the threat that al-Qaeda could acquire an atomic bomb. It's possible, but I still think it's rather unlikely. Al-Qaeda has shown that it, and groups like it cannot be deterred or contained. Sure, nations can be contained and deterred, but if both sides have the same destructive capabilities, containment swings both ways.
I don't believe that it's unreasonable to assume that proliferation of nuclear and missile technology to nations hostile to Canada (or more likely to the United States) is inevitable. To be prepared for this contingency, it is necessary that Canada take part in the construction of the North American Missile Defence. Presently, I rate Canada's coerceability as rather low, because like most, I don't believe that anyone has any specific reason for hating Canada right now. This could change though. Having a missile defence system leaves the government much freedom to act in such a situation.
More important though is the free-rider problem. If the United States builds the NMD alone, does that mean that the missile protection would end at the 49th parallel?It's reasonable to assume that the protection would be extended somewhat to keep any explosions out completely. In that case though, Canada would be a major free-rider because a large portion of Canada's population would be protected by America's missile defence (and by America's tax dollars). Thus, the only ethical choice should be to take part in its construction. Canada cannot remain a leech on America's good will and its defence projects. Perhaps if Canada played a major role in the development and deployment of a North American Missiel Defence system, then the United States would be less likely to seem to ignore Canada for lengthy periods of time (though at present they seem to be motivated by political differences).
It is important that Canada get in on the action (with regards to NMD) now instead of later. The longer this is postponed, the further along America's plans will be. By then, it may be too late to take more of Canada's interests into account. The longer Canada waits, the less important it will be to the entire project, implying that Canada will have less power to affect the system's deployment and operation. In the end, waiting will have a much more negative impact on Canada's sovereignty because it will give Canada even less control over its own defence.
Obviously this is a complex issue, and I hope to tackle it again soon.
I will admit that my view on this subject has changed from when I first heard about it. Initially, my reaction to the prospect of America's National Missile Defence was to label it as the "son of Star Wars" and to criticise the administration for rocking the boat of international balance of power. I think I know why my view changed though. For this, I can thank North Korea. I'm afraid that I have difficulty viewing this issue with much clarity. In any case, North Korea is a separate issue. To be brief, my view on NMD changed because of the North Koreans apparent attempts at blackmailing the international community, specifically the United States. So in the end, I've come out in mild support of North American Missile Defence.
Firstly, I would like to say that Canada and the United States have a long history of defensive cooperation. This only made sense because our mutual border is the longest undefended border in the world. Despite our differences, Canadians and Americans have so much in common. Unfortunately, this is usually ignored. I have two major arguments to make in support of North American Missile Defence. First is the threat of proliferation. Second is the free-rider issue and national responsiblity.
Why is proliferation a problem? Is containment always an option for dealing with rogue states? These questions are interconnected, and are fundamental regarding nations such as North Korea and pre-war Iraq. Proliferation is a major problem. Obviously I'm not talking about the international small arms trade, a deplorabale trade that may be. People may be able to brush off the threat posed by weapons of mass destruction (WMD), since no leader in their right mind would ever consider using one, right? Are we willing to take that chance? (There's nothing quite like answering a rhetorical question with an equally rhetorical question.) I personally believe that most people are deluded to the actual threat that WMDs pose. The real risk that such weapons impose on the world is that certain unscrupulous nations will use the threat of such weapons to coerce their citizens (consider pre-war Iraq) or other nations (consider North Korea) into doing what they want. Of course there's the concomitant risk that they will get used, but I believe that we can safely assume that both parties (particularly the weaker one: the one without a deterrent) will do everything possible to prevent the use of WMDs (such as concede in the face of demands). This is one reason why the United States wants to build the national missile defence.
Despite international treaties such as NPT, proliferation of atomic and missile technology has continued. It is pretty well accepted that North Korea traded its missile technlogy with Pakistan (prior to the coup of Pervez Musharraf) in exchange for aid in its nuclear program (probably uranium enrichment). North Korea has shown that is it willing to to sell its missile technology to the highest bidder. It is naive to think that international treaties alone can stop proliferation, especially given the half-hearted commitment of many nations to the cause. What about individuals or groups? Personally, I don't pay too much heed to the threat that al-Qaeda could acquire an atomic bomb. It's possible, but I still think it's rather unlikely. Al-Qaeda has shown that it, and groups like it cannot be deterred or contained. Sure, nations can be contained and deterred, but if both sides have the same destructive capabilities, containment swings both ways.
I don't believe that it's unreasonable to assume that proliferation of nuclear and missile technology to nations hostile to Canada (or more likely to the United States) is inevitable. To be prepared for this contingency, it is necessary that Canada take part in the construction of the North American Missile Defence. Presently, I rate Canada's coerceability as rather low, because like most, I don't believe that anyone has any specific reason for hating Canada right now. This could change though. Having a missile defence system leaves the government much freedom to act in such a situation.
More important though is the free-rider problem. If the United States builds the NMD alone, does that mean that the missile protection would end at the 49th parallel?It's reasonable to assume that the protection would be extended somewhat to keep any explosions out completely. In that case though, Canada would be a major free-rider because a large portion of Canada's population would be protected by America's missile defence (and by America's tax dollars). Thus, the only ethical choice should be to take part in its construction. Canada cannot remain a leech on America's good will and its defence projects. Perhaps if Canada played a major role in the development and deployment of a North American Missiel Defence system, then the United States would be less likely to seem to ignore Canada for lengthy periods of time (though at present they seem to be motivated by political differences).
It is important that Canada get in on the action (with regards to NMD) now instead of later. The longer this is postponed, the further along America's plans will be. By then, it may be too late to take more of Canada's interests into account. The longer Canada waits, the less important it will be to the entire project, implying that Canada will have less power to affect the system's deployment and operation. In the end, waiting will have a much more negative impact on Canada's sovereignty because it will give Canada even less control over its own defence.
Obviously this is a complex issue, and I hope to tackle it again soon.
Wednesday, May 14, 2003
International Legitimacy and the UN
With the resignation of Claire Short from Tony Blair's cabinet, I think it's worth discussing whether the UN actually does what so many people claim: giving the actions of individual member states international legitimacy. Well, I think many people are right in this respect. The UN can and does confer legitimacy in a very novel way. It is wrong though (in my opinion) to say that it is the only source of legitimacy, or rather, the only valid source of legitimacy.
Firstly, let us consider the UN's problems.
1) The UN is not a world government, and without serious reworking of its charter, it can not be and will never be one. Actually, in many respects, this is a good thing.
2) The UN as an institution is hindered by its institutional legacy and inertia. If I may explain... the UN's General Assembly (GA) was a holdover of the pre-WWII League of Nations. As such, the GA is a talk shop devoid of significant geopolitical power. Before you cry blasphemy, please hear me out. There are serious limits to what can be said in resolutions passed by the GA. At most, the GA can only suggest a course of action, or beg one party to do something. At its nastiest, the GA can condemn a nation for its actions, but this is really only an expression of international opinion that has little bearing inside a country willing to ignore it. The Security Council (SC) embodies Franklin Delano Roosevelt's idea of the "four policemen". He had this bad idea that the permanent members of the SC would enforce the world order, and it stuck. The body does wield significant power, but it is not really representative of the balance of world power (of course, it's hard to measure this kind of thing). The weakness of the SC is that the permanent members block significant action on important issues, and with good cause too! That leads us to the next problem...
3) The UN is a venue in which foreign policy, and international politics plays out. This is just reality. The actions of the UN tend to be tainted by national interests. During the building up to the Iraq war, the US and France fought to legitimise their respective positions in the UN for better or for worse. While there are certainly examples of selfless action in the UN, I believe that such occasions are in the minority. How many times has action been avoided because a permanent member of the security council didn't like it? Or some coalition of nations is not in favour because the decision affects them?
4) The UN has a contradictory mission. It is supposed to protect human rights, and promote democratic freedoms on some level. At the same time, it is supposed to preserve national sovereignty. Incidentally, this tends to trump the UN's other mandates. The UN is a bit like a vampire: it needs to be invited in. Take Zimbabwe for an example. Without a doubt, Zimbabweans are being made to suffer, their human rights are being violated, and their democratic freedoms are being denied. Can the UN do something? Without the Zimbabwean government's approval, there is practically nothing that the UN agencies can do to alleviate the situation.
5) The UN is abused through the use of political horse-trading. How do you think Libya got to head one of the UN's human rights commissions? Sure, Libya has come a long way, but Qaddafi still has hundreds, if not thousands of political prisoners. Imagine the mayhem if a rogue state were to head the international criminal court
6) The UN just what its name implies: a union of nations, not people. the European Union is trying to represent the European people as well as their nations. The UN doesn't even come close. There is no world parliament. People have no representation at the UN. As such, the UN is not to be held accountable to people, only the nations that support it. There can not and should not be any expectation that the UN will adopt a course of action just because it's popular. Sure, millions of people opposed the war in Iraq (before it ended), but the UN didn't condemn it (neither did it support the war).
7) International law is quite murky and complicated. It can only be enforced so far as national governments are willing to cooperate. With regards to international conventions, they can only be binding if ratified by the representatives of the people: the parliament or equivalent. I must admit that my knowledge of international law is quite limited. I am quite sceptical of the whole issue though. The International Criminal Court is supposed to make strides towards enforcing international human rights law. Without political support from nations though, it cannot survive. It also lacks the executive and legislative support that a national judicial system enjoys. International accords are composed by diplomats: appointed representatives of elected governments. What executive branch enforces international law? Certainly not the UN secretariat. It exists on a skeleton budget. Another important issue is that there is no international constitution, and nobody similar to the supreme courts within nations that determine whether international law is constitutional. There is no judicial review or appeal.
Don't get me wrong. I like the UN. Actually, I've participated in a number of model UN events. People who are celebrating the end of the UN right now are likely to be disappointed. The UN does many things well. Multilateral aid management, in my opnion, has a much better track record than bilateral aid. The UN tends to handle development issues quite well. The UN's peacekeeping operations have probably saved millions of lives. At least by representating nations, it is harder for minority interests and NGOs to foist their specific agendas upon the world community, noble though they may be.
The likelyhood of reform of the UN is quite low. Diplomats have talked about restructuring the SC to eliminate the permanent seats, and to increase the size of the body. The permanent members (especially Russia, France and the UK) are likely to continue to block such attempts because they would lose power as a result. The formation of a world parliament under the auspices of the UN is incredibly unlikely because that would weaken the power of national governments.
So, what about the original question? Does the UN confer legitimacy upon actions at the international level? Yes, to the extent that it is only a plurality of other nations that provide their support. Is this legitimacy important? It can be. It is only important so far as national governments value and respect it.
For some, the war in Iraq was a slap in the face. So many people seemed to be against it. Nevertheless, only a few national governments acted vociferously against the war. It is important to note that the UN is not the be all and end all of legitimacy. According to American public opinion, there was broad support for the Bush government throughout the war. Polls showed George W. Bush's popularity was way above 50% during the fighting, and continues be so. Clearly, the administration had a mandate from the American people for the conflict. Did the American people not provide some legitimacy to the actions of their government?
I will get back to this issue later.
With the resignation of Claire Short from Tony Blair's cabinet, I think it's worth discussing whether the UN actually does what so many people claim: giving the actions of individual member states international legitimacy. Well, I think many people are right in this respect. The UN can and does confer legitimacy in a very novel way. It is wrong though (in my opinion) to say that it is the only source of legitimacy, or rather, the only valid source of legitimacy.
Firstly, let us consider the UN's problems.
1) The UN is not a world government, and without serious reworking of its charter, it can not be and will never be one. Actually, in many respects, this is a good thing.
2) The UN as an institution is hindered by its institutional legacy and inertia. If I may explain... the UN's General Assembly (GA) was a holdover of the pre-WWII League of Nations. As such, the GA is a talk shop devoid of significant geopolitical power. Before you cry blasphemy, please hear me out. There are serious limits to what can be said in resolutions passed by the GA. At most, the GA can only suggest a course of action, or beg one party to do something. At its nastiest, the GA can condemn a nation for its actions, but this is really only an expression of international opinion that has little bearing inside a country willing to ignore it. The Security Council (SC) embodies Franklin Delano Roosevelt's idea of the "four policemen". He had this bad idea that the permanent members of the SC would enforce the world order, and it stuck. The body does wield significant power, but it is not really representative of the balance of world power (of course, it's hard to measure this kind of thing). The weakness of the SC is that the permanent members block significant action on important issues, and with good cause too! That leads us to the next problem...
3) The UN is a venue in which foreign policy, and international politics plays out. This is just reality. The actions of the UN tend to be tainted by national interests. During the building up to the Iraq war, the US and France fought to legitimise their respective positions in the UN for better or for worse. While there are certainly examples of selfless action in the UN, I believe that such occasions are in the minority. How many times has action been avoided because a permanent member of the security council didn't like it? Or some coalition of nations is not in favour because the decision affects them?
4) The UN has a contradictory mission. It is supposed to protect human rights, and promote democratic freedoms on some level. At the same time, it is supposed to preserve national sovereignty. Incidentally, this tends to trump the UN's other mandates. The UN is a bit like a vampire: it needs to be invited in. Take Zimbabwe for an example. Without a doubt, Zimbabweans are being made to suffer, their human rights are being violated, and their democratic freedoms are being denied. Can the UN do something? Without the Zimbabwean government's approval, there is practically nothing that the UN agencies can do to alleviate the situation.
5) The UN is abused through the use of political horse-trading. How do you think Libya got to head one of the UN's human rights commissions? Sure, Libya has come a long way, but Qaddafi still has hundreds, if not thousands of political prisoners. Imagine the mayhem if a rogue state were to head the international criminal court
6) The UN just what its name implies: a union of nations, not people. the European Union is trying to represent the European people as well as their nations. The UN doesn't even come close. There is no world parliament. People have no representation at the UN. As such, the UN is not to be held accountable to people, only the nations that support it. There can not and should not be any expectation that the UN will adopt a course of action just because it's popular. Sure, millions of people opposed the war in Iraq (before it ended), but the UN didn't condemn it (neither did it support the war).
7) International law is quite murky and complicated. It can only be enforced so far as national governments are willing to cooperate. With regards to international conventions, they can only be binding if ratified by the representatives of the people: the parliament or equivalent. I must admit that my knowledge of international law is quite limited. I am quite sceptical of the whole issue though. The International Criminal Court is supposed to make strides towards enforcing international human rights law. Without political support from nations though, it cannot survive. It also lacks the executive and legislative support that a national judicial system enjoys. International accords are composed by diplomats: appointed representatives of elected governments. What executive branch enforces international law? Certainly not the UN secretariat. It exists on a skeleton budget. Another important issue is that there is no international constitution, and nobody similar to the supreme courts within nations that determine whether international law is constitutional. There is no judicial review or appeal.
Don't get me wrong. I like the UN. Actually, I've participated in a number of model UN events. People who are celebrating the end of the UN right now are likely to be disappointed. The UN does many things well. Multilateral aid management, in my opnion, has a much better track record than bilateral aid. The UN tends to handle development issues quite well. The UN's peacekeeping operations have probably saved millions of lives. At least by representating nations, it is harder for minority interests and NGOs to foist their specific agendas upon the world community, noble though they may be.
The likelyhood of reform of the UN is quite low. Diplomats have talked about restructuring the SC to eliminate the permanent seats, and to increase the size of the body. The permanent members (especially Russia, France and the UK) are likely to continue to block such attempts because they would lose power as a result. The formation of a world parliament under the auspices of the UN is incredibly unlikely because that would weaken the power of national governments.
So, what about the original question? Does the UN confer legitimacy upon actions at the international level? Yes, to the extent that it is only a plurality of other nations that provide their support. Is this legitimacy important? It can be. It is only important so far as national governments value and respect it.
For some, the war in Iraq was a slap in the face. So many people seemed to be against it. Nevertheless, only a few national governments acted vociferously against the war. It is important to note that the UN is not the be all and end all of legitimacy. According to American public opinion, there was broad support for the Bush government throughout the war. Polls showed George W. Bush's popularity was way above 50% during the fighting, and continues be so. Clearly, the administration had a mandate from the American people for the conflict. Did the American people not provide some legitimacy to the actions of their government?
I will get back to this issue later.
Spam 101
Everywhere it elicits strong emotions.
Either your a victim, or you're making money off of it. Is there a valid use of spam? Is there an ethical argument to support this cancer of the internet? I have to say maybe to both questions. Like most people, I hate spam. I can remember 5 or 6 years ago, receiving only a few pieces of spam in my inbox every few days. These days, I receive upwards of 50 day, which is probably less than what a lot of people have to go through. I think there must be some valid use for spam. It wouldn't be so bad if the spammers didn't need to cheat to get the messages into the inbox. Then again, it would be much easier to block the crap if they didn't cheat. Ideally (at least in my mind), bulk e-mailers shouldn't need to send their spam anonymously or fraudulently. Most of the people who receive it, and just going to delete it anyways and get pissed off.
Why bother even trying to get the spam into their inbox? There are two types of people who fall for spam: people who are genuinely interested in what is being advertised, and poor saps who don't know what they're doing.
There's a big contradiction with regards to spam and privacy. Many people are rightfully scared of making private information public on the internet. No one really wants to give away demographic information for fear that they will be spammed by marketers. I've got news for you: That's how marketing operates, by trying to target advertising to people who will want to buy the product in question. Unfortunately, this paradigm failed. Now, the only economically viable way of performing e-mail advertisement is by sending it out by the millions, and hope that .01% out there follow through and buy your product. With modern spammers, there is no attempt to cultivate the client/vendor relationship. In an ideal world, we would only get commercial e-mail for products that we as consumers in specific demographics would conceivably want to buy. Also ideally, we wouldn't get so much of it. Unfortunately, we've missed the boat for this. The ideal situation is unattainable, and I am willing to bet that spam will probably continue in the format in which we know it now for several years to come at least.
Laws may make a difference. Unfortunately, the only remedies that I believe will work will be economic in nature, as opposed to legal. Charging a flat charge for every e-mail could do this. Better (or worse) still would be to charge internet users for bandwidth use, instead of providing it on a flat rate basis. That would get everyone re-thinking how they use their internet time. Imagine if your internet usage was metered just like water, electricity or gas. That would bring up some privacy issues, but let's try not to think of internet usage that way. In many ways, it's just another utility. As long as bandwidth is plentiful, I seriously doubt that there can be much done about this. We're stuck like this until all the excess capacity is wrung out of the fibre optic grid that spans the world. Also, the ISPs would have charge a pretty steep price to curtail spam, a price that I doubt as a society we are willing to pay.
Why do I think that laws will fail to curtail spam? Laws have physical limits. Outside of the jurisdiction of the government that has passed the law, the law has no effect. We may manage to curtail the spammers around us, but new ones will pop up in other countries. Imagine if North Korea got into the spamming business. It already sells illegal narcotics and WMD technology (but that's another topic to come up...), what could be done then. No international accord could stem the tide of spam.
Does that leave us without hope then? Well, we'll see. I will talk about this subject again in future.
Everywhere it elicits strong emotions.
Either your a victim, or you're making money off of it. Is there a valid use of spam? Is there an ethical argument to support this cancer of the internet? I have to say maybe to both questions. Like most people, I hate spam. I can remember 5 or 6 years ago, receiving only a few pieces of spam in my inbox every few days. These days, I receive upwards of 50 day, which is probably less than what a lot of people have to go through. I think there must be some valid use for spam. It wouldn't be so bad if the spammers didn't need to cheat to get the messages into the inbox. Then again, it would be much easier to block the crap if they didn't cheat. Ideally (at least in my mind), bulk e-mailers shouldn't need to send their spam anonymously or fraudulently. Most of the people who receive it, and just going to delete it anyways and get pissed off.
Why bother even trying to get the spam into their inbox? There are two types of people who fall for spam: people who are genuinely interested in what is being advertised, and poor saps who don't know what they're doing.
There's a big contradiction with regards to spam and privacy. Many people are rightfully scared of making private information public on the internet. No one really wants to give away demographic information for fear that they will be spammed by marketers. I've got news for you: That's how marketing operates, by trying to target advertising to people who will want to buy the product in question. Unfortunately, this paradigm failed. Now, the only economically viable way of performing e-mail advertisement is by sending it out by the millions, and hope that .01% out there follow through and buy your product. With modern spammers, there is no attempt to cultivate the client/vendor relationship. In an ideal world, we would only get commercial e-mail for products that we as consumers in specific demographics would conceivably want to buy. Also ideally, we wouldn't get so much of it. Unfortunately, we've missed the boat for this. The ideal situation is unattainable, and I am willing to bet that spam will probably continue in the format in which we know it now for several years to come at least.
Laws may make a difference. Unfortunately, the only remedies that I believe will work will be economic in nature, as opposed to legal. Charging a flat charge for every e-mail could do this. Better (or worse) still would be to charge internet users for bandwidth use, instead of providing it on a flat rate basis. That would get everyone re-thinking how they use their internet time. Imagine if your internet usage was metered just like water, electricity or gas. That would bring up some privacy issues, but let's try not to think of internet usage that way. In many ways, it's just another utility. As long as bandwidth is plentiful, I seriously doubt that there can be much done about this. We're stuck like this until all the excess capacity is wrung out of the fibre optic grid that spans the world. Also, the ISPs would have charge a pretty steep price to curtail spam, a price that I doubt as a society we are willing to pay.
Why do I think that laws will fail to curtail spam? Laws have physical limits. Outside of the jurisdiction of the government that has passed the law, the law has no effect. We may manage to curtail the spammers around us, but new ones will pop up in other countries. Imagine if North Korea got into the spamming business. It already sells illegal narcotics and WMD technology (but that's another topic to come up...), what could be done then. No international accord could stem the tide of spam.
Does that leave us without hope then? Well, we'll see. I will talk about this subject again in future.
Tuesday, May 13, 2003
Welcome to contemporary comments!
Introductions are in order... I am a business administration student at Simon Fraser University (SFU) in Burnaby, BC. Presently, I am studying finance, international business and mathematics. With any luck, I will graduate some time in 2005, though SFU students have a strange tendency of taking more than 4 years to finish an undergraduate degree.
Politically, I would describe myself as a liberal internationalist. Naturally, there is a lot of confusion out there as to who actually straddles the middle of the political spectrum. I tend to be sceptical on a lot of political issues. I will admit to some level of prejudice against the radical left, and a certain amount of ridicule for the extreme right. Sometimes, it's difficult to separate oneself from the point-of-view of one's source of information. I know the there are a lot of valid points and arguments supporting and opposing political issues, but obviously, I can't subscribe to every one. If you don't like what I have to say, tough beans!
Robillard
Introductions are in order... I am a business administration student at Simon Fraser University (SFU) in Burnaby, BC. Presently, I am studying finance, international business and mathematics. With any luck, I will graduate some time in 2005, though SFU students have a strange tendency of taking more than 4 years to finish an undergraduate degree.
Politically, I would describe myself as a liberal internationalist. Naturally, there is a lot of confusion out there as to who actually straddles the middle of the political spectrum. I tend to be sceptical on a lot of political issues. I will admit to some level of prejudice against the radical left, and a certain amount of ridicule for the extreme right. Sometimes, it's difficult to separate oneself from the point-of-view of one's source of information. I know the there are a lot of valid points and arguments supporting and opposing political issues, but obviously, I can't subscribe to every one. If you don't like what I have to say, tough beans!
Robillard
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