Wednesday, November 11, 2009

U.S. Free Trade Agreements (FTAs) and pending FTAs

by M. Ulric Killion

According to the Office of the United States Trade Representative (USTR), Ron Kirk, the “United States has free trade agreements in force with 17 countries.” These countries as listed by the USTR are:
The USTR also reports that the “United States has signed free trade agreements with Colombia, Korea, and Panama, but Congress must enact legislation to approve and implement each individual agreement in order for them to go into effect.” Source: Office of the United States Trade Representative.
Summaries and Text
>>See Full Text of the Agreement (English) here.
>>See Full Text of the Agreement (Spanish) here. 
Reports on the Agreement
>>See ITC Report here.
>>See Interim Environmental Review here.
  • The United States and Panama signed a trade promotion agreement, sometimes called a Free Trade Agreement (FTA), on June 28, 2007. Panama approved the TPA on July 11, 2007. The United States has not yet approved the TPA.
The Office of the United States Trade Representative has also received “Public Comments Concerning the Pending Colombia and Korea Free Trade Agreements.” According to the USTR, “United States Trade Representative Ronald Kirk announced today that USTR has received more than five hundred responses to requests for public comment on the free trade agreements that have been negotiated with Colombia and the Republic of Korea. USTR had issued notices at the end of July inviting comment by interested parties by noon today, September 15. In its ongoing effort to identify and resolve outstanding issues related to the pending free trade agreements, USTR sought comments on stakeholders' views of the costs and benefits of the FTAs, how well they accomplished the objectives of the 2002 Trade Promotion Authority Act, and what concerns they may have with the agreements.” . . . .


As earlier mentioned, the free trade agreements, though signed, with the Republic of Korea and Columbia are pending ratification by U.S. Congressional approval. Despite the importance of ratifying both of these pending FTAs, the decision concerning ratification, thus bring into effect these agreements, will, ultimately, resolve to a political decision by the U.S. Congress. Moreover, a U.S. Congressional decision to ratify these critical FTAs will serve as a measure of the United States’ commitment to multilateral world trade.


Additionally, the following articles and essays discuss the politics of the ratification of both the KORUS FTA and the United States-Colombia Trade Promotion Agreement, notwithstanding the critical economic and diplomatic significance of these pending FTAs.
1). Korea-EU FTA failed to finalize, but still pending, which cites the following sources:   
  • Jim Abrams, Former Dallas Mayor Ron Kirk confirmed as US trade representative, AP, March 18, 2009, (Chicago Tribune). 
  • Killion, M. Ulric. 2004. China’s Foreign Currency Regime: The Kagan Thesis and Legalification of the WTO Agreement, 14 Minn. J. Global Trade 43, (Winter).  
  • WTO NEWS: SPEECHES — DG PASCAL LAMY, March 2, 2009.
  • Bettina Wassenger, Tentative Free Trade Deal for S. Korea and Europe, NY Times, March 24, 2009.
  • South Korea, EU Reach Agreement On FTA, Bernama (Malaysian news agency), March 24, 2009.
3). Pending Ratification of the Korea-US FTA (KORUS FTA) and calls for renegotiation, which cites the following sources:
  • Anthony Faiola, U.S. to Toughen Its Stance On Trade, Washington Post, March 10, 2009, A01.
  • M. Ulric Killion, Regional Economic Integration, Aug. 2008.
  • South Korea/US: FTA jumps major hurdles, faces others, Oxford Analytica, International Herald Tribune, April 2, 2007.
  • NAFTA Secretariat website. 
  • Lawmakers Postpone Korea-U.S. FTA Bill, Chosun Ilbo  (Arirang News), March 5, 2009. 
  • Korea-Singapore Trade Doubles Since 2005 FTA, Chosun Ilbo  (Arirang News), March 2, 2009. 
  • Dan Griswold, NAFTA at 10: An Economic and Foreign Policy Success, Cato Institute, Free Trade Bulletin, No. 1: December 17, 2002, >> Read full article - PDF version of Free Trade Bulletin No. 1.
  • Chung Hae-kwan, The Korea-Chile FTA: Significance and Implications, East Asia Review, Vol. 15, No. 1, Spring 2003, pp. 71-86, >> Read full article – PDF version.
  • Free Trade Agreement between EFTA and South Korea,(European Free Trade Association), European Reports, September 4, 2006.
Copyright © Protected - All Rights Reserved M. Ulric Killion, 2009.
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Thursday, November 5, 2009

Legal Reforms and Judicial Independence in Turkey: The Western-Donor-Aid Issue

by M. Ulric Killion    

Today’s Turkey referendum resulted in a significant boost to Prime Minister Recep Tayyip Erdogan’s ruling AKP party as voters approved 26 amendments to the country’s 1982 Constitution; Turkey referendum boosts Erdogan's Islam-rooted AKP party, CS Monitor, Sept 12, 2010, Osman Orsal/Reuters.   

A recently written short essay by Emrullah Uslu and titled “Judicial Opposition Criticizes the AKP Government,” and appearing in the Eurasia Daily Monitor, should be of interesting to those following modern judicial reforms in the Republic of Turkey (Turkey). The AKP government represents what hails as the Justice and Development Party or White Party (i.e., Turkish: Adalet ve Kalkınma Partisi). The issue of reforming Turkey’s judiciary system transcends domestic borders. This is because even the Bretton Woods Institutions (BWIs), such as The World Bank, continue to follow Turkey’s modern judicial reforms.

A case in  point is that during the December 10, 2004 – Program: Judicial Reform for Improving Governance in Turkey, several representatives of governments, international bodies,  non-governmental organization and other institutions, including the World Bank, are in attendance as participants.  The concluding remarks for the 2004-Program were actually delivered by Roberto Dañino, who was, then, the senior vice president and general counsel of the World Bank, before resigning in 2006.

Demonstrating the international interests in judicial reforms in Turkey, the 2004-Program was actually a World Bank-funded program, and is only one of several judicial reform programs that have been funded by sources outside Turkey. 

Judicial Reform Projects in Turkey 

The “Judicial Modernization and Penal Reform” program was sponsored by the Council of Europe, and entails a budget of 10 million Euros, with a duration period from 2003-2005.

For the period of 2006, there is the “EU/Phare Twinning Covenant Domstolsverket” program was sponsored by the SIDA (The SwedishInternational Development Cooperation Agency), which was implemented by the Domstolsverket - The Swedish National Courts Administration.

For the duration of 2006, there was the “Pre-study in Turkey on Development of the Judiciary” program sponsored by the SIDA and implemented by the Swedish National Courts Administration (SNCA), though in partnership with the Ministry of Justice of Turkey.

During the period from 2001- 2002, there was the “Judicial Sector Exchange Program” sponsored by the DRL (Bureau of Democracy, Human Rights and Labor, U.S. Department of State), with a budget of $400,000.

For the years 2005-2006, there is the “Support to the Establishment of Courts of Appeal” program sponsored by the EU Development Projects and implemented by the Brussels 5 - EC institutions, with a budget of EUR 800,000.

Then there is the Oct.-Dec. 2005 World Bank-sponsored “Judicial Reform Learning Program in Turkey” program that was implemented by the PREM and LEG. 

Earlier in 2000, there is the “Strengthening of the Judiciary in Southeast Europe (Albania, Bosnia & Herzegovina, Bulgaria, Croatia, FYROM, Greece, Romania, Turkey and where possible Yugoslavia)” program sponsored by the SELDI (Southeast European Legal Development Initiative) and implemented by the “The International Development Law Institute.” 

There is of course the earlier mentioned 2004- Judicial Reform for Improving Governance in Turkey program that was sponsored by the World Bank. 

During the period 2003-2006, there is the “Strengthening Human Rights Capacity in Turkey” program sponsored by the SIDA and implemented by the Raoul Wallenberg Institute of Human Rights and Humanitarian Law, with a budge of SEK 30 626 000.

Judicial reform programs of this variety generally premise on a democracy promotion approach, thus, entailing an expectation of enhancing the institutional capacity of governments and their institutions. In the specific context of judicial reform, this generally means an expectation of improving institution capacity in areas such as access to justice, building networks, improving access to information, and improving the quality of judicial and legal education. The earlier mentioned programs, likewise, intend to improve the capacity of Turkey’s judicial system; i.e. carry out much-needed reforms, develop and implement strategies designed to address obstacles to reform.

Notwithstanding judicial programs from the 1990s, the earlier mentioned judicial reform programs in the 2000s also intend to address gaps, as in comparison to developed countries and economies, in developmental goals. Notwithstanding good governance models or policy, these are the gaps (or lags) mostly occurring in the areas of agriculture, energy, finance, transportation, communication, health and education.

Majid Mohammadi writes, “After decades of failures of developmental projects in authoritarian states, international community reached to this point that development will not be sustainable without reform in the areas of law, justice and public administration. Compared to billions of dollars spent on security and defense and hundreds of millions of dollars spent on infrastructural development, mostly funded (granted or loaned) by the international donors, millions of dollars spent on good governance is not noticeable.”

In terms of modern judicial reforms in Turkey, International bodies funding various judicial reforms programs expect that Turkey will improve both the functionality and efficiency of its judiciary system. A problem, however, may be that these international bodies funding reforms also expect that improvements in functionality and efficiency should parallel Western standards, or more particularly, the EU (European Commission and the Council of Europe) model. In defense of international bodies funding these programs and urging judicial reforms in line with Western standards, it seems reasonably that closing the gap (lag) might necessitate that countries and economies, such as Turkey, should align the conditions of its judicial system with international standards, such as the United Nations and the EU models. 

Turkey’s Judicial Opposition 

Emrullah Uslu, in “Judicial Opposition Criticizes the AKP Government,” writes:
The long standing dispute between Turkey's ruling Justice and Development Party (AKP) and the judiciary has once again resurfaced in recent weeks. Since 2007 the judiciary has led the opposition against the AKP. The constitutional court attempted to shut down the AKP and ban the prime minister from politics, while supreme court judges use every occasion to criticize the AKP government, and local courts file cases against President Abdullah Gul (EDM, January 13, May 20). Recently the Supreme Board of Judges and Prosecutors (HSYK) differed with the justice ministry's annual appointment lists.
In the Turkish judicial structure the HYSK, which consists of five elected members from the supreme court and the council of state and two from the justice ministry (Justice Minister Saadullah Ergin and his undersecretary), has undisputed power to appoint judges and prosecutors on an annual basis. Judges and prosecutors' appointments usually occur in late June. This year, however, due to the disagreement between the justice ministry and the HSYK to determine who should be appointed and to which particular court, this process has suffered delays. The Turkish press reported that the conflict between the two centered on whether the prosecutors should remain in place, investigating the Ergenekon criminal network and the prosecutors who investigated unsolved political murder cases in the Kurdish region in 1990's and arrested Colonel Cemal Temizoz for his alleged involvement (Radikal, July 21).
Justice ministry officials insist that the Ergenekon prosecutors and those who investigated the unsolved murder cases in the Kurdish region must remain in their posts to maintain their judicial independence. However, Ali Suat Ertoson a member of the HSYK, reportedly presented an alternative list to appoint new prosecutors to examine these issues (Star, July 24).
While the crisis continues a photograph was leaked to the press showing Ertosun in a meeting with an Ergenekon suspect standing trial in the case (Yeni Safak, July 18). In addition, Ertosun has reportedly spent two days with Brigadier-General Ali Aydin, the commander of the Kayseri Regional Gendarmerie, where the suspect Colonel Temizoz works (Bugun, July 27). Consequently, the AKP government has pressured the HSYK to fire Ertosun (Yeni Safak, July 18). In response, the Deputy Head of the HSYK, Kadir Ozbek, released a statement refuting the allegations against Ertosun, and stating that his meeting with the Ergenekon suspect was a "normal procedure" (Cihan News Agency, July 27). . .
After three weeks of deadlock, the HSYK suggested a possible compromise. The HSYK members agreed that the current Ergenekon judges and prosecutors would retain their positions on the condition that the ministry launches an inquiry into the complaints and charges against the Ergenekon prosecutors -if sufficient evidence exists. . . The HSYK, meanwhile, will be responsible for making a decision on the inquiry (Hurriyet Daily News, July 28). . . In the aftermath of this reconciliation, HSYK elected members issued a written statement criticizing the justice ministry, the AKP government and the media. . .  The statement, however, did not mention whether the board has discussed replacements relating to Ergenekon and unsolved murder cases in the Kurdish region. The justice ministry responded to the HSYK's press statement by insisting that replacing the Ergenekon and unsolved murder case prosecutors violated the judicial independence of the prosecutors. It also accused the HSYK members of an unlawful attempt to use the authority of the justice ministry (Zaman, July 30).
Uslu’s essay, though insightful, speaks to on-going problems of Turkey’s judicial model and judiciary reforms, including a Western perceived need for greater independence of Turkey’s judiciary. His essay also presents issues of the efficient and effective delivery of foreign aid by Western donors intending to promote judicial reforms in other countries. 

The Functional and Efficient Judiciary 

During his closing remarks at the earlier mentioned 2004-Program, Roberto Dañino (2004), in a review of the program modules, described six modules; i.e. Module 1, Module 2, etc. He also stated that there are “four essential dimensions for the process of reforms” which are “institutions, the legal system, enforcement and social commitment.” Dañino then went on to summarize each of the program modules.

In Module 1, they (or participants) “examined the Principle Problem of the Judiciary establishing basic definitions, agreed on essential principles and also reviewed case load management, the practice of calling experts, and judicial personnel policy.”

In Module 2, they “discussed Ethical standards, their Enforcement for Judges and the Legal Professionals and Accountability of the Judiciary.”

In Module 3, they “reflected on the crucial role of Appointment, Promotion, Discipline and Removal of Judges and the complex nature of independence and accountability.”  Module 3 also deserves further attention. This is because Dañino mentioned two important functions of judicial review.

According to Dañino, “The first is to limit government power, and the second is to protect the rights of individuals. When a judiciary is truly independent, then its decisions are respected and enforced and the institution is less subject to political influence. However, judicial independence must be balanced by accountability of the judiciary and the obligation to carry out its duties while following the highest ethical standards. Judicial corruption ultimately destroys judicial independence.”

In Module 4, they “focused on European Union Accession in relation to access to justice and continuing education.”

In Module 5, they “discussed access to justice in relations to alternative dispute resolution (ADR) given that such services also improve the ability of a legal system to offer and deliver justice.”

In Module 6, they reviewed they discussions, “noted points of fundamental agreement, and received” their “Action Plan which will become a useful guide for follow-up activities.”

Nonetheless, as earlier mentioned, Uslu’s essay speaks to on-going problems of Turkey’s judicial model and judiciary reforms, including a Western perceived need for greater independence of Turkey’s judiciary. This also presents issues of the delivery of efficient and effective foreign aid that intends to promote legal reforms. 

The Issues of Legal Reform and Western Donors 

The issues of legal reforms are critical to all models of development. In the context of Turkey, it presents a challenge to a final accession to the EU. On April 14, 1963, Turkey submitted its application to accede to the EU (then the European Communities). In 1963, Turkey became an associate member of the EU. In 1995, Turkey signed a Customs Union agreement with the EU in 1995 and, on December 12, 1999, at the Helsinki summit became an official candidate for full membership. A negotiation process addressing Turkey’s full membership actually commences on October 3, 2005 with most authorities perceiving that accession, and assuming resolution of pending issues (i.e., judicial reforms), predicts a process that may take as long as ten years from this date. 

Although Turkey also became a member of the Council of Europe in 1949, the Organization for Economic Co-operation and Development (OECD) in 1961, the Organization for Security and Co-operation in Europe (OSCE) in 1973, and an associate member of the Western European Union in 1962, Turkey’s membership bid to the EU remains pending (Cendrowicz, Time, Sept. 8, 2009). Borrowing from the title of Cendrowicz’s article, “Fifty Years On, Turkey Still Pines to Become European.” 

All of this, ultimately, presents issues of the efficient and effective delivery of foreign aid by Western donor countries intending to promote judicial reforms in other countries and economies, especially non-Western countries and economies. In this respect, the EU and other countries may be wise to take their lead from earlier suggestions of the Brookings Institution and the Center for Strategic and International Studies (CSIS).

This is because, “in June 2006, a joint task force convened by the Brookings Institution and the Center for Strategic and International Studies (CSIS) released recommendations for reorganizing and reprioritizing U.S. foreign aid programs. The Brookings-CSIS Task Force called for a comprehensive review of foreign aid, led by Congress but involving key non-governmental organizations (NGOs) and government agencies, with the Goldwater-Nichols Defense Reorganization Act of 1986 serving as its model. The Brookings-CSIS Task Force advocates a U.S. development mission that is on parity with U.S. defense and diplomacy, which could result in the creation of a Department for Global Development for bringing together more than fifty U.S. government units involved in aid delivery. The task force also noted that U.S. spending on foreign assistance has seen its greatest increase in forty years, an expansion that also produced a growing incoherence in policy and a fragmentation in organization. What was observed to be a critical problem was the threat to hard power assets, resulting in the United States needing to deploy its soft power more effectively and efficiently” (Killion, 2007; Brookings-CSIS Task Force Releases New Recommendations on Transforming Foreign Aid, Brookings Inst., June 22, 2006).

The 2006 report of the joint task force “centered on the United States failing to take fuller advantage of potential synergies, with these disparate efforts sometimes working at cross purposes. The task force essentially found that the United States punches well below its throw weight in the international community, which should be unmatched when measured in absolute aid dollars. For these reasons, U.S. foreign aid must move away from a one-size-fits-all approach and should be redirected by a unified framework fusing U.S. objectives supporting capable foreign powers and countering security, humanitarian and transnational threats with differentiation based on governance and economic capacities. As a result, U.S. aid programs must be customized to the capacity and need of beneficiary-countries, while also recognizing that beneficial-countries afflicted with poor governance routinely perform the worst in addressing human needs” (Killion, 2007).

In the context of the efficient and effective delivery of U.S. foreign aid and legal reforms, there is the parallel example of U.S. foreign aid intending to promote legal reforms in Mainland China. This is because “United States foreign operations appropriations for China primarily support democracy-related programs, such legal training, legal aid, criminal defense, labor rights, the development of NGOs in China, monitoring human rights conditions in China from outside China, and preserving Tibetan culture. United States funding has been substantive in the area of legal reforms. The U.S. Congress has approved substantive funding for such programs, reflecting a growth from $10 million in 2002, to $23 million in 2006. From 1999 to 2006, U.S. government funding for democracy-related programs in China was about $110 million. Although the major recipients are Temple University (rule of law project), the International Republican Institute (village elections project) and the Asia Foundation (civil society project), many experts and authority suggest that U.S. congressional funding for legal reform efforts in China have produced limited benefits due to the lack of judicial independence, weak enforcement of laws, constraints on lawyers and political corruption” (Killion, 2007; Thomas Lum, U.S.-Funded Assistance Programs in China, CRS Report for Congress, May 18, 2007. General Accounting Office, Foreign Assistance: U.S. Funding for Democracy-Related Programs, Feb. 2004). 

For these reasons, the EU would be wise to follow the recommendations set forth in the 2006 report, especially concerning the delivery of foreign aid intending to effect legal reforms that align the conditions of Turkey’s judicial system with international standards, such as the EU models. As observed by the eminent Professor Stanley Lubman, in the context of China and legal reforms, “China’s difficult transition is reflected in its legal institutions” and “The United States can assist China to build its legal institutions without preaching” (Stanley Lubman: A letter to Obama, WSJ, Nov. 4, 2009). Nonetheless, Professor Lubman admittedly argued that the United States should increase its support for legal reforms. Professor Lubman writes:
In recent years the U.S. government, including your predecessor’s administration, has increased the support that it has given to strengthen labor rights, legal aid, open government, and administrative law, augmenting the support for these and other institution-building efforts by multilateral and U.S. NGOs. The current administration ought to increase that support while restraining highly public calls that urge China to speed up its adherence to Western values. You might suggest creation of a modest program of U.S.-Chinese cooperation on legal issues” (Lubman, 2009).
Conclusion 

It should now be understood, colloquially speaking, that Western donors should not simply throw vast sums of money at a problem without regard for issues such as efficiency and effectiveness, and even functionality. As previously mentioned, Western donors funding various judicial reforms programs expect that Turkey will improve both the functionality and efficiency of its judiciary system. A problem, however, are Western donors expecting that improvements in functionality and efficiency should parallel Western standards, or more particularly, the EU model. As the case of China and legal reforms arguably demonstrate, it may be unreasonable to expect that the closing of this gap necessitate that recipient-countries of donor aid will align the conditions of its judicial system with international standards, such as the EU models.

Additionally, Professor Lubman’s argument for continued support for legal reforms is not contra distinguishable from the thesis of this essay. This is because the essay does not intend to urge a denial of all foreign aid directed to or intending to promote legal reforms in other countries such as China and Turkey. Rather, what is being called for is the efficient and effective delivery of foreign aid, including foreign aid intending to promote legal reforms in other countries. It is for these reasons, the earlier report from the 2006 joint task force, which was convened by the Brookings Institution and the Center for Strategic and International Studies (CSIS), provides invaluable insights to this historical problem of Western donors. Moreover, in the event, Turkey ever accedes to the EU one reasonably suspects that it will largely be a political-based decision (e.g., China’s 2001 accession to the WTO despite a Western-perceived-need for reform of its judiciary).


Sources:
Emrullah Uslu, Judicial Opposition Criticizes the AKP Government, Eurasia Daily Monitor -- Volume 6, Issue 146, July 30, 2009.
Majid Mohammadi, Judicial Reform Projects Sponsored by International Donors in Egypt and Turkey, USAID (http://www.usaid.gov), Oct. 17, 2006.
Leo Cendrowicz, Fifty Years On, Turkey Still Pines to Become European, Time, Sept. 8, 2009.
Brookings-CSIS Task Force Releases New Recommendations on Transforming Foreign Aid, Brookings Inst., June 22, 2006.
Thomas Lum, U.S.-Funded Assistance Programs in China, CRS Report for Congress, May 18, 2007.
General Accounting Office, Foreign Assistance: U.S. Funding for Democracy-Related Programs, Feb. 2004.
Ulric Killion, Modern Chinese Rules of Order (2007), Chapter 8.

Copyright © Protected - All Rights Reserved M. Ulric Killion, 2009.
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Sunday, October 18, 2009

The Sinicization of the Bolshevik Revolution

by M. Ulric Killion

The photo shows Petrograd, 4 July 1917, and street demonstration on Nevsky Prospekt just after troops of the Provisional Government had opened fire with machine guns; Photo/Russian Revoluton/Wikimedia Commons (Public Domain).

In a recent New York Times article, Clifford J. Levy (Russia’s Leaders See China as Template for Ruling, NY Times, Oct. 17, 2009), made the following observation. Levy writes:
Nearly two decades after the collapse of the Communist Party, Russia’s rulers have hit upon a model for future success: the Communist Party. Or at least, the one that reigns next door. Like an envious underachiever, Vladimir V. Putin’s party, United Russia, is increasingly examining how it can emulate the Chinese Communist Party, especially its skill in shepherding China through the financial crisis relatively unbowed. United Russia’s leaders even convened a special meeting this month with senior Chinese Communist Party officials to hear firsthand how they wield power. In truth, the Russians express no desire to return to Communism as a far-reaching Marxist-Leninist ideology, whether the Soviet version or the much attenuated one in Beijing. What they admire, it seems, is the Chinese ability to use a one-party system to keep tight control over the country while still driving significant economic growth. It is a historical turnabout that resonates, given that the Chinese Communists were inspired by the Soviets, before the two sides had a lengthy rift.
Levy, though perhaps inadvertently, is addressing the history, or perhaps even human geography, of a past and present China. In other words, he is addressing a history of the growth of the early Chinese communists and the Chinese Communist Party. It is also a history addressing an earlier vision of Mao Zedong, when he wrote, “The salvoes of the October Revolution [or Bolshevik Revolution] brought us Marxism-Leninism. The October Revolution helped progressives in China, as throughout the world, to adopt the proletarian world outlook as the instrument for studying a nation’s destiny and considering anew their own problems” (Mao Zedong, Selected Works, Foreign Language Press, 1961, Vol. IV, 413).

In terms of the “May 30th Movement (1925) [“that pushed the May Fourth Movement into the past”] that is, generally, recognized as serving as the moment of crystallization, in terms of the pursuit of revolutionary policy by early Chinese communists,” for earlier “Chinese intellectuals pursuing Marxist ideology, the Bolshevik Revolution answered the question of whether a backward country could seize state power and commence the pursuit of modernization” (Ulric Killion, Modern Chinese Rules of Order (2007), Chapter 4).

Then there is the historical relationship and struggles between the former Soviet Union and China. “In the 1920s and 1930s, the early Chinese communists would often succumb to Lenin’s insistence, and then to Stalin’s insistence, in order to avoid impairing the solidarity between China and the former Soviet Union, such as what occurred in the 1950 signing of the new Sino-Soviet Treaty of Friendship and Alliance, and it attendant subsidiary agreements. In the 1950s and 1960s, Chinese leaders for the sake of solidarity would succumb to Stalin, and then Khrushchev. In the interim, the influence of the Bolshevik Revolution and Marxism continued to grow in the China of the 1920s and 1930s, and in subsequent years” (Killion, at Chapter 4). 

In subsequent years, the relationship between China and the former Soviet Union and then later by Russia would experience profound  changes; which is perhaps subsequent to the localization or even Sinicization of the Bolshevik Revolution. In other words, changes attributable to “the by-product of a Chinese phenomenon of taking borrowed and transplanted foreign concepts and ideas, such as Marxism and Leninism, and imbuing them with the Chinese revolutionary spirit, such as the continuing attempt to finalize the adaptation, Sinicization or localization of Marxism to the realities of traditional culture and society” (Killion, at Chapter 1).

Levy rightly observes that: “Nearly two decades after the collapse of the Communist Party, Russia’s rulers have hit upon a model for future success: the Communist Party. Or at least, the one that reigns next door.” In a historical context, it is phenomenon commencing in the 1960s that is much more, however. This is because: “In the 1960s and 1970s, China began to emerge as a world player, as it plays the strategic game alongside the former Soviet Union and the United States, in the Asia region. In the years that followed, China became increasingly intolerant of succumbing to the insistence of the Soviet Union and its leaders, as it had done so in past eras” (Killion, at Chapter 4). 

In the context of International communism, the former Soviet Union and now Russia, the consequences of the historical growth and development of China and the Chinese Communist Party are obvious. “In the new millennium, it is China, and not the former Soviet Union or now Russia, which is evolving into the leading Marxist, communist or socialist country. From the 1920s to the new millennium, China evolved into a world player and is no longer a puppet of the former Soviet Union, or mere pawn in the international communist movement. Rather, China is now a leading world player in the international community. China has, in effect, adapted, Sinicized or localized the Bolshevik Revolution. As for Marxism, China after borrowing the Western philosophy of Marxist philosophy, gave it a Chinese name, Mao’s socialism, and then commences the process of adapting, Sinicizing or localizing Marxism, and is continuing to do so, in an attempt to finalize its adaptation, Sinicization or localization. China also borrowed Soviet models of industrialization and planning, and then jointly pursued a socialist-political polity and capitalist-economic policy. It is no less different than when China borrowed Buddhism during the Han Dynasty, because the Taoists, after accepting the heavens and hells from Buddhism, gave them Chinese names and invented Chinese Gods that would preside over them” (Killion, at Chapter 4).

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Wednesday, September 23, 2009

A reader for the Group of 20 (G20) Pittsburg-financial summit

The Group of 20 (G20) financial summit convenes in Pittsburgh, Pennsylvania, from September 21 to 25, 2009. According to the The G20 Pittsburgh Summit Press Room, the selection of Pittsburgh as the site of the G20 summit is due to the city serving “as a model for economic and environmental transformation in the United States and abroad. The city has reinvented itself by building a balanced, innovation-driven economy based on its strengths in advanced manufacturing, financial services, information and communications technologies, health care and life sciences, education and research, and energy and environmental solutions.” The accomplishments of the city of Pittsburgh serve as a precursor to the critical issues confronting the G20 gathering.
For those unaware of the many issues confronting the G20 Pittsburg-summit, what follows is a short list of essays and interviews, including transcripts, that address several of the critical issues confronting the world's financial representatives and leaders that have come together in Pittsburg to discuss economic policies and address the global financial crisis.

The listing, though there are many other informative sources available, includes a list of informative and insightful interviews and essays from both the Brookings Institution and Peterson Institute for International Economics.

From the Brookings Institution:

G-20 Summit: Recovering from the Crisis

To enhance global coordination and to implement effective financial recovery policies, Brookings experts provide recommendations on how the G-20 can overcome current global governance and economic challenges.
 
Introduction » (PDF)
by Kemal Derviş, Vice President and Director, Global Economy and Development
Download the full report » (PDF)

Articles

The G-20 and the World Economy: Sink or Swim » (PDF)
Eswar Prasad recommends that the G-20 maintain momentum on reforming the international institutions and advance international regulatory reform for the betterment of the overall global economy.

Confronting the Protectionism Spawned by the Crisis » (PDF)
Chad P. Bown makes the case for re-affirming the G-20 economies’ commitment to the World Trade Organization and curbing trade-restricting policies created by the crisis.

The G-20 and IMF: Their Future Roles in the International Monetary System » (PDF)
Domenico Lombardi proposes that the G-20 should focus on supporting effective measures to reform the International Monetary Fund.

To the G-20: Don’t Overlook Africa During the Recovery » (PDF)
Ernest Aryeetey, Mwangi Kimenyi and John Page assess the impact of the financial crisis on Africa and urge the G-20 leaders to support African economic recovery and growth. 

Welcome to the New Era of G-20 Global Leadership » (PDF)
Colin Bradford and Johannes Linn assess the effectiveness of the G-20 summits and how to move the G-20 forward as the global steering body.

International Financial Redesign: A Latin American Perspective » (PDF)
Mauricio Cárdenas calls for international financial regulatory reform in order to address Latin America’s need for greater financial development and to prevent future crises.

The G-20 and Climate Change: Achieving Comparable Effort Through a Carbon Price Collar » (PDF)
Warwick McKibbin, Adele Morris and Peter Wilcoxen propose G-20 leaders to focus on the challenges associated with climate change negotiations leading up to the United Nations climate conference in December.
From the Peterson Institute for International Economics:
audio  Peterson Perspectives: Interviews on Current Issues

Simon Johnson says the Obama administration is not doing much to fix the financial system, and the G-20 summit may do even less.


Nicholas R. Lardy, analyzing the origins of the dispute with China over tire imports, warns that the fight could imperil future US-China economic and political cooperation.


Morris Goldstein says that Treasury Secretary Geithner's proposals for regulatory reform are a step forward that could be endorsed in principle at the G-20 summit in Pittsburgh.

See also Peterson Institute Update: Global Economic Prospects, Commentary on Pittsburgh G-20

Michael Mussa The United States and the world economy have embarked on economic recoveries that will gather strength in the second half of 2009 and proceed fairly strongly through next year and into 2011. These recoveries may not be quite as vigorous as earlier postwar recoveries following deep recessions, but they will surpass almost all current forecasts on the upside and will once again illustrate that steep recoveries tend to follow deep recessions. While most economic forecasters expect a tepid recovery, and some fear a "double dip" in which economies fall back into recession at an early stage, Mussa expects "a V-shaped recovery" to be the most likely course. He forecasts that real GDP growth in the world will be 4.2 percent in 2010, spurred in part by greater than anticipated growth in developing countries and emerging markets. Real GDP growth in the United States will be 4 percent by the end of next year. The US unemployment rate in 2009 peaks at or a little below 10 percent but will fall below 9 percent by the end of 2010. China and India, which have been leading the global recovery, will register growth rates of 8.3 and 6.4 percent, respectively, in 2009 and 9 and 7.5 percent, respectively, in 2010. Mussa's forecast for 2009 is modestly above corresponding forecasts by the International Monetary Fund (IMF) but considerably higher than the IMF forecasts for 2010. Economic performance over the next 16 months will reveal whether Mussa's "conservatively optimistic" view is correct. 
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The G-20 is overlooking the more complex challenges that economic policy must confront as a result of the emergency measures undertaken since mid-2007. The exit strategy needs more international coordination in the form of: returning to a normal interest rate policy; shifting from discretionary fiscal stimulus to putting government budgets on sustainable paths; and withdrawing of banks' guarantees and state-ownership stakes. This type of international policy coordination is not only desirable but attainable, according to Adam Posen. He proposes that the G-20 leaders shed the notion that coordination gains are small, that the emphasis should be on discussion of policy measures and sequences, and that the measures agreed upon should consist of pragmatic steps. Working toward a pact on an exchange intervention standstill instead of a scheme for ongoing surveillance will ensure the G-20 gets through the exit from this crisis safely while providing the foundation for a more sound future regime. 
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Simon Johnson The United States has been in a bubble-bust-bailout cycle since the late 1920s. During the most recent crisis, Ben Bernanke saved the financial system in the short term while exacerbating the long-term pattern of bubble-bust-bailout. A proposal unveiled by Treasury Secretary Timothy Geithner to reduce the number of agencies carrying out regulation and giving new powers to the Fed is unlikely to work, according to Peter Boone and Simon Johnson, who cite the proposal's inability to alter banks' incentive to take excessive risks.
The authors propose a four-part solution to the bubble-bust-bailout cycle that centers heavily on making bank owners more financially responsible for the risks they take. The first part of their solution is to sharply raise capital requirements at banks so shareholders have more at stake and feel that their money is truly at risk when a bank takes gambles. Second, the managers and boards of directors of financial institutions should be personally liable up to a reasonable sum when their companies fail—losing a portion of past salaries and bonuses while seeing their pensions reduced. Third, rules need to be put in place so that regulators and public servants are not financially conflicted. Finally, we need more assertive leadership at the Fed regarding broader system issues.
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Marcus Noland While the effects of liberalized trade in goods have received much attention, research suggests that the gains from liberalized cross-border movements of labor would be much greater. But cross-border migration raises a number of economic and ethical issues, from individuals' right to seek a better situation for themselves and their families to the social externalities of increased migration both for sending and receiving countries. These issues are a source of growing controversy in countries around the globe, but the lack of a multilateral mechanism to address cross-border migration ensures that individual countries will continue to respond haphazardly to migration and its effects, while the number of migrants only grows. 
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See also from the Peterson Institute of International Economics: Pittsburgh G-20 Commentary 

America Cannot Resolve Global Imbalances on Its Own
C. Fred Bergsten and
Arvind Subramanian
Financial Times,
August 19, 2009

The G-20: An Idea from India
Arvind Subramanian
Business Standard,
August 26, 2009

Pittsburgh Priorities
Edwin M. Truman
RealTime Economic Issues Watch,
September 8, 2009 


A Pat on the Back at Pittsburgh?
Michael Mussa
Peterson Perspectives Interview,
September 9, 2009 


G-20 Summit in Pittsburgh, IMF Meeting: What to Expect?
Simon Johnson
RealTime Economic Issues Watch,
September 10, 2009


Ahead of Pittsburgh, Little Progress on Financial Reform
Simon Johnson
Peterson Perspectives Interview,
September 16, 2009


Making Capital Rules Work
Adam S. Posen
Welt am Sonntag\
September 16, 2009

How To Prevent an Unruly Rush for the Exit
Adam S. Posen
Financial Times
September 17, 2009

Pressures on Obama at the G-20 in Pittsburgh
C. Fred Bergsten
Peterson Perspectives Interview,
September 21, 2009 


G-20 Thinking: In the Medium Run We Are All Retired
Simon Johnson
RealTime Economic Issues Watch,
September 23, 2009

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