Edit

Worldwide Web: Transatlantic Divergences on Its Future (5/31)

Email Print

In an unusual joint public-private initiative, political leaders and major Internet players held a broad open forum on May 24-25 in Paris to discuss the future of the Internet. Held on the sidelines of the G8 summit meeting of Western powers in Deauville, the web forum was called "the e-G8." The outcome was foreseeable -- more divergences than agreement.

Read more...
 
Edit

What DSK Meant to IMF (5/25)

Email Print

In the maelstrom of debt engulfing the eurozone in 2009, IMF Managing Director Dominique Strauss-Kahn was “the right man in that place at that time” – both for Europe and for the Fund’s own stature. That favorable judgment is part of a well-informed, nuanced overall account of his record at the IMF that was given to European Affairs two days before the first report surfaced of the scandal that led to his downfall. The insights and evaluation came from Edwin “Ted” Truman, a highly esteemed international economist. Currently a senior fellow at the Peterson Institute for International Economics in Washington, Truman has held many senior positions in the U.S. government and in the IMF.

Under Strauss-Kahn, the IMF transformed itself from being an enforcer of rules on developing countries to becoming a pivotal player in helping rescue European countries and even the euro itself amid a transatlantic financial meltdown. As a sign of its revived prominence, the Fund tripled its resources for lending. Retracing these developments in his question-and-answer session with European Affairs on Friday, May 13, Truman, a prominent “insider-outsider” in the Fund’s evolution, offered an incisive summing-up of what Strauss-Kahn succeeded in changing at the Fund and a partial list of some challenges that remain.

Read more...
 
Edit

e-G8 Wants to Be New Forum on Web Freedom and Governance (5/23)

Email Print

A special variant of the G-8 – this one to bring together a “summit” of web leaders – is meeting in France ahead of the regular G-8 summit meeting this week in Deauville. In this initiative, President Nicolas Sarkozy is convening key players from the public and private sector including such influential figures as NewsCorp owner Rupert Murdoch, Facebook’s Mark Zuckerberg, the French Minister of Finance Christine Lagarde and the European Commissioner for the Digital Agenda Neelie Kroes for a two-day debate (May 24-5) to discuss Internet-related questions -- notably how to ensure its reliability and accessibility while protecting the global system’s security.

Read more...
 
Edit

If U.S. And Europe Stick Together, the IMF's Next Head Will Be European (5/19)

Email Print

International jockeying is already intense about picking a successor to Dominique Strauss-Kahn, who resigned as head of the IMF on May 18. It is a key post in global financial affairs: under Strauss-Kahn, the Fund regained prestige and power, mainly as an influential investor and arbiter in the rescue and bail-out packages for debt-stricken European countries such as Greece, Ireland and Portugal.

Traditionally, the post of Managing Director has been held by a European, but pressures have been mounting in recent years for emerging countries with growing economies in Asia and Latin America to gain more weight at the Fund. This has led to more votes for them and also talk about seeing them put forward a candidate from these countries to challenge the informal arrangement giving Europe a monopoly on the top job.

Already, statements have come out from Germany, Belgium and the European Commission, saying that “IMF leadership should stay in European hands” at a time when the Fund is playing such a central role in the financial crisis around the euro. That view has been publicly espoused by German Chancellor Angela Merkel, whose country is both a powerful player at the IMF and also the principal national bankroller of loans to stricken eurozone nations. A similar position has been taken by Jose Manuel Barroso, the President of the European Commission, who cites the need of any successor to rally strong financial support among the Fund’s largest contributors – implicitly designating a candidate from one of the richer European states.

Already there are signs of growing support for France’s Finance Minister Christine Lagarde as the main contender. Highly regarded in international financial circles, she combines her influence in Europe with years working as a banker in the U.S. She was already being talked about as a successor for Strauss-Kahn in the event that he stepped down this summer to run for the French presidency. His sudden downfall probably adds strength of the argument in her favor.

There are dissenting arguments about the presumption that the post should be kept by a European. For example, see this piece by Nicolas Véron. In this vein, some Fund officials privately say that the Euro crisis does not necessarily preclude a non-European candidate as a managing director now. Indeed, this thinking goes, Strauss-Kahn was personally instrumental as a respected European in persuading initially-reluctant eurozone governments to accept intervention by the IMF, which then became a core element in the ongoing rescue efforts for Greece, Ireland and Portugal.

In that initial phase of the crisis, it was particularly helpful that Strauss-Kahn was well-known and trusted in European political and financial circles after his years as “one of their own” as France’s Finance Minister before coming to the Fund.  Now,  it can be argued, with the IMF role in place, there might be advantages to having a non-European – an “outsider” – in the job and tasked with enforcing the Fund’s often unpalatable medicine in the form of tough conditions on the loans to struggling European countries.

This reasoning is very much a minority view in Western capitals, especially in the current emergency situation. Any change at the top of the IMF would trigger a complicated re-arrangement of several key posts in the international financial system. When the current major global financial institutions were set up after World War II, the Western world’s overwhelming financial weight meant that the World Bank was headed by an American (currently Robert Zoellick) and the IMF by a European, with an American second-in command – a practice adhered to ever since.

Today, “the current EU-US balance at the World Bank and IMF should be kept intact,” says Chancellor Merkel in voicing not just her own view but that of other European leaders. At the IMF, the top deputy currently is Joseph Lipsky, 64, a respected and experienced American, who has taken interim control of the Fund, including the negotiations with Greece and other eurozone countries. He has already been partly handling them under Strauss-Kahn, but Lipsky had already announced (last week) that he will retire in August.

A new chief would serve the remainder of Strauss-Kahn’s five-year term -- supposed to run into 2012 – and then be favored to stay on.

In the perspective of a regular transition, there was already talk about seeing candidates emerge from countries such as Singapore, India, Turkey, South Africa or Mexico. In the crisis situation now, it has become more important than ever that any successor must have great professional and international credibility – and Europeans are stressing the need for someone with strong personal credibility in Europe.

Chancellor Merkel, speaking in Brussels after a eurozone meeting on Greece earlier this week, said “we know that in the mid-term developing countries have a right to the post of IMF chief and the post of World Bank Chief. In the current situation, when we have a lot of discussions about the euro, that Europe has good candidates to offer.”

Amplifying on that theme, an influential financial commentator in the Financial Times, Wolfgang Münchau -- who has often been critical of EU leaders’ management of the euro crisis – agreed that the IMF needs to be run by a European at this juncture . The post must go to “the most capable candidate,” he wrote, but that choice must be viewed in light of the fact that the “new IMF chief will deal with mostly with European issues for his or her first term.”  Since the IMF role has been partly political, bridging difference when national governments could not agree on economic policy, Münchau said, “I wonder to what extent a highly competent Mexican central banker, for example, would be able to fulfill this role?” (take this out of italics Agustin Carstens, a former Mexican finance minister under Felipe Calderon and now governor of Mexico’s central bank, has often been cited as a man with the qualifications for the IMF job if it went to a non-European. That view is shared by at least one country whose finances are at stake – Ireland, whose Finance Minister Michael Noonan has said that the IMF replacement at the helms should be a European.

Britain, while not a member of the eurozone, is a major player at the Fund, and British officials say an emerging market candidate is still an option and that the UK is reserving its position, but that Prime Minister David Cameron would be “very happy” to back a strong European candidate if one emerged. Gordon Brown, Britain’s former Labour prime minister, has been quietly lobbying for the job but is opposed by the Conservative-led British government, the FT reported.

A key factor in the chances of a non-European candidate would be whether large developing countries could unite behind a single figure.

The Obama administration has not spoken publicly on this issue, beyond urging a formal interim replacement as managing director. During Strauss-Kahn’s tenure, Washington has favored some changes at the Fund that has reduced Europe’s number of seats (by two from a previous seven or nine depending on complex rotations). But that diplomacy was aimed at long-term change with a view to easing any rivalry between the G-20 and the more broadly based IMF, with its 187-nation membership.

As things stand, mathematically if the U.S. and European countries vote together, the next managing director will be European.

It is a singular opportunity to measure the state of thinking about transatlantic solidarity.

 

-----European Affairs
 
Edit

If U.S. And Europe Stick Together, the IMF's Next Head Will Be European (5/18)

Email Print
Speculation is rife about the potential international politics that would be involved in picking a successor to Dominique Strauss-Kahn if he has to be replaced as head of the IMF. It is a key post in global financial affairs: under Strauss-Kahn, the Fund has regained prestige, mainly as an influential investor and arbiter in the rescue and bail-out packages for debt-stricken European countries such as Greece, Ireland and Portugal.
Read more...
 
Edit

U.S. Goes To Arctic Ministerial Promoting Pragmatic Cooperation -- UPDATE (5/17)

Email Print

--- POST-MEETING-UPDATE

At the Nuuk meeting, the Arctic Council put off the European Commission’s application for “permanent observer” status – probably for two years. The bid was strongly supported by one Arctic Council member state, Finland (which also belongs to the EU). But it was opposed by two other permanent Council members, Canada and Russia. Decisions are taken by unanimity on the Council. A decision on the EU application – based on criteria established at Nuuk – is set to be taken within two years, ie by the time of the next Council ministerial.

A letter – contending that non-littoral countries are affected by changes in the Arctic and should be heard on the Council – was circulated to the meeting by France, which has observer status and wants more rights for countries with that status. The incoming chair of the Council, Sweden, stressed the rights of the eight members. “Members are members, and observers are observers,” Swedish Foreign Minister Carl Bildt was quoted as saying.

EU sources voice complaints that Canada and Russia have “closed attitudes”  in which they say they are trying to keep the Council from becoming unwieldly as a rationalization for maintaining their degree of control. In the French letter, Michel Rocard, a former prime minister who is the ambassador to the Council, said: "Over the next 20 or 30 years, putting the Arctic to good use is the most colossal of any current human endeavour." The letter implicitely queried whether the eight Arctic Council states would have the capacity to tackle the growing list of issues. A fuller account of this debate can be found at "EU gets cold shoulder in the Arctic."

------ European Affairs

The Obama administration, ei wrote on May 11, is sending a strong and hopefully influential delegation to the ministerial meeting of the Arctic Council on May 12 in Nuuk, the capital of Greenland, the continent-sized Arctic island linked with Denmark. In the eight-nation consultative body of littoral states, Washington is working to play a role on Arctic issues by using tangential leverage because the U.S. is not a party to the main relevant treaty.

Just as with the International Criminal Court and with climate-change negotiations, Washington has not ratified the key treaty instruments – in this case, the treaty formally known as the UN Convention on the Law of the Sea.  In the circumstances, Washington has again (as in ICC work and in climate negotiations)  sought to step up its weight and input in operational negotiations – in this case, with the other Arctic Council member states: Canada, Denmark (and Greenland), Finland, Iceland, Norway and Sweden. To emphasize U.S. interest (and enhance U.S. powers of persuasion), the Obama administration is sending Secretary of State Hilary Clinton and Interior Secretary Ken Salazar to the ministerial.

In framing U.S. hopes for the meeting Deputy Secretary of State James Steinberg described it as an opportunity to expand what he called a “new model” for international cooperation on issues for which there is no treaty-based set of negotiated rules and obligations.  In the Arctic, that instrument is the Law of the Sea treaty, which has been signed by the U.S. but never ratified since its inception in 1994.

In this situation, the Obama administration has sought a constructive role – for the Arctic and for U.S. interests – in embracing pragmatic cooperation as the only alternative.  As presented by Steinberg, the State Department number two official, who has managed these issues for the last two years and was appearing this week after his recent resignation to go to academia, a workable “good news” basis for joint international action nowadays is for countries to volunteer their own objectives, hope that other countries will emulate this with ambitious and complementary efforts of their own and then press each other to live up to their commitments.

This process is what Steinberg sees happening in the Arctic today in a situation where there is no timeframe or political prospect for Senate ratification of the Law of the Sea accord.  In the absence of binding treaty-based joint action, Steinberg sees pragmatic cooperation as a viable way forward. He spoke on these issues this week at a meeting hosted by a Washington think tank, CSIS. Here are excerpts of his remarks on this point:

A great example of this approach, he said, can be seen in the search and rescue agreements that are being signed among Arctic countries. “It is a legally binding agreement; we’re going to be able to do it as an executive agreement, so we can go forward with that. I think there are a number of other examples of steps that we can take to reach inter-governmental agreements that allow us to advance a number of instances…[for example], coordinated domestic action on short-term climate forces [such as black carbon]. These are all things that can be done in collaboration with other Arctic countries, and I think what’s interesting about the Arctic Council is that we really are breaking new ground in terms of tools of collaboration. We’re not a treaty-based organization, but what we’re finding is that it facilitates negotiations among the member-states, and that, I think, is going to be a model for a lot of international organizations that don’t have some of the rigidities of the more formal institutions. The efforts that we make on short-lived climate-forcing agents can contribute to the broader climate discussions taking place through the UN Framework Convention and elsewhere. But [at the Arctic Council] we have nimbleness because it’s a smaller group of significant countries, and can take decisions going forward. [Similarly] to climate work, I think, this is going to be more and more the model that you see of how you stimulate broader international agreements moving forward. Of course, I also want to emphasize that on the Law of the Sea, although we have not yet acceded to it, the United States as a signatory abides by and respects the provisions of that treaty, and we continue to believe it’s an important instrument to our national interests....

[In the Arctic as with climate mitigation] I think what we recognize at the end of the day is that they require domestic actions by the key players. But if you think about the model established by Copenhagen and now incorporated in the Cancun agreement, [it] is a system that allows individual nations to make commitments, but to have the kind of mutual commitment to each other, and in the context of these individual action plans, we will be responsive to each other’s efforts. That’s why the Copenhagen-Cancun model of individual countries putting forward action plans but engaging with dialogue with their partners and trying to encourage coordinated efforts I think is a very promising model moving forward. As I say, the step from Copenhagen to Cancun shows that these kinds of efforts can be effective. So what we’ll be looking for with respect to short-term climate forces, not just among the Arctic member states, but also other nations, is steps that we can take together. And so, for example outside this context, as I mentioned today in China-U.S. bilateral talks [on the global context of short-lived climate forces], we are looking for steps that we can mutually take both to provide technology exchanges, but also to strengthen our own domestic efforts. “

Steinberg amplified his views on this theme in a subsequent part of his answers to questions about how the U.S. and other Arctic littoral (and non-littoral nations) can cooperate on common problems in the melting Arctic outside the most relevant treaty, the Law of the Sea.

What the U.S. and other governments are seeking, in the Arctic Council ministerial and in wider international efforts,  he said, is “a coordinated effort of individual states looking at what is needed broadly and trying to find common understandings about steps these individual states can take. The problem, of course, is different in the different countries. [On black carbon, for example] for more developed countries the challenge has to do with diesel…others deal with problems of domestic cooking and heating. I do not think there is a single answer in terms of what to do in every country. There are elements of this, for example, in the question of hydrochlorofluorocarbons, where there are formal mechanisms both through the Montreal protocol and the U.N.F.C.C.  that may allow for formal agreements. But again here, the point is that the coordinated focus and coordinated set of efforts to put attention on these issues, have encouraged countries to step up to the plate, take strong actions domestically and give the sense that this is a collective action problem…i.e. in the sense that, if everybody does not help, then individual actions do not have that big an impact. There is unlikely to be a formal legal agreement on this, but we are challenging each other to make the collective and common efforts to raise the standards, incentivize strong action and give people sense that, if you take strong action, others will do it, too. This tool has proven to be a successful one and allows us to move this agenda forward without some of the rigidities of going through the negotiation of a formal agreement.”

Steinberg’s perspective and upbeat theme are set to be vindicated in some degree by movement at the Arctic Council ministerial meeting on some agenda items such as codifying the body’s “observer status” to include more non-littoral nations and setting action-agendas on black carbon.

But serious constraints remain on the U.S. role in the Arctic due to the country’s failure to ratify the law of the sea treaty which defines the rights and responsibilities of nations in their use of the world's oceans – including the newly navigable Arctic Sea, establishing guidelines for businesses, the environment, and the management of marine natural resources.

In this context, the U.S. role has shown some ambivalence in approaching its “Arctic vocation” as now embraced by the Obama administration as a national security priority. As described in a paper by the Center for Strategic and International Studies, the Washington think tank that sponsored Steinberg’s briefing, the U.S. so far has preferred “either to remain outside Arctic governing structures such as the Law of the Sea Convention or requiring that Arctic organizations be informal, technical and project-driven in nature such as the Arctic Council. Although the United States has long been regarded as a science power in the Arctic, it is a nation with very limited Arctic infrastructure and coast guard capabilities.” CSIS has worked with the World Wildlife Federation and other partner organizations to produce a policy study on the issues.

 

------ European Affairs

 
Edit

Int'l Criminal Court Seeks Gaddafi Arrest Warrant On War-Crimes Charges (5/17)

Email Print
The chief prosecutor of the International Criminal Court (ICC) in The Hague has formally requested arrest warrants for Moammar Gaddafi and two of his relatives for crimes against humanity.
Read more...
 
Edit

Battle Over New “.xxx” Internet Address for Porn Underscores EU-US Dilemma on Internet Governance (5/13)

Email Print

Official uneasiness about the state of Internet governance is rising as governments on both sides of the Atlantic have come to recognize how limited their ability is to control it. The latest public symptom of this anxiety surfaced in a leaked official letter from European Commission Vice President Neelie Kroes who is also the Commissioner for the Digital Agenda, to U.S. Secretary of Commerce Gary Locke in which she sought U.S. help in stopping the deployment of a new Internet “suffix” -- ".xxx" –- to identify pornography sites on the web. “This is a major public policy concern,” she wrote, “not only because of the unknown effects it may have in terms of internet stability, but also because of the implications such blocking may have for internet censorship and freedom of expression.”

Read more...
 
Edit

U.S. Goes To Arctic Ministerial Promoting Pragmatic Cooperation -- UPDATE (5/17)

Email Print

--- POST-MEETING-UPDATE

At the Nuuk meeting, the Arctic Council put off the European Commission’s application for “permanent observer” status – probably for two years. The bid was strongly supported by one Arctic Council member state, Finland (which also belongs to the EU). But it was opposed by two other permanent Council members, Canada and Russia. Decisions are taken by unanimity on the Council. A decision on the EU application – based on criteria established at Nuuk – is set to be taken within two years, ie by the time of the next Council ministerial.

Read more...
 
Edit

EU Tries, Unsuccessfully, to Block New ".xxx" Internet Address For Porn (5/11)

Email Print
Governmental uneasiness -– worsened by official “cluelessness” –- about the state of Internet governance is rising as governments on both sides of the Atlantic come to a greater realization about the importance of Internet coupled with recognition of the fact that they have only limited ability to control it.
Read more...
 
Edit

EU Must "Ask More" From Athens (5/9)

Email Print

Even if rumors about a Greek departure from the eurozone have been deflated, the recent flurry of speculation should not obscure the hard facts about what Athens needs to do: shrink the country’s defense spending, privatize more public-sector activity and collect more taxes from companies and wealthy citizens. These are the conditions for energizing the country’s economy and businesses.

Read more...
 
Edit

British Voters Enthusiastic About NOT Changing Status Quo in Voting System (5/6)

Email Print

A referendum proposing a complicated tweak in Parliamentary elections was rejected by a “no” vote with a large enough margin to amount to simple repudiation.  With enough ballots counted to ensure the measure’s defeat, projections said that the outcome could approach a 70-30 defeat for the measure, which was put to voters on the same day as local elections in England, Scotland, Wales and Northern Ireland.

Read more...
 
Edit

Ronald D. Asmus (1958-2011) -- A Tribute (5/3)

Email Print

Ron Asmus had already made his place in history – as a worthy successor to the great generation of “Atlanticists” who built and nurtured the transatlantic partnership – when he died last week at the tragically early age of 53. For more than two decades, he had been tirelessly energetic and remarkably effective in pushing his commitment to the emergence of a Europe whole and free. His influence was powerful in policy communities on both sides of the Atlantic: in Europe, he was an adviser and reassuring ally to leaders with aspirations to freedom; in the U.S., he constantly reminded Americans how much they needed that kind of Europe.

Read more...
 
Edit

Killing of Bin Laden May Provide Opening For Compromise In Afghan War (5/2)

Email Print
Will the elimination of Osama Bin Laden help open the way to an end of the war in Afghanistan and an earlier withdrawal of more U.S. and European troops fighting there in the NATO-led offensive against the Taliban? This question is already being debated in policy circles in Washington (and in European capitals) on the day after the killing of Al Qaeda’s leader.
Read more...