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TITLE Great Decisions [and] Teacher's Guide. 1995Edition.

INSTITUTION Foreign Policy Association, New York, N.Y.REPORT NO ISBN-0-87124-161-7; ISBN-087124-159-5;

ISSN-0072-727XPUB DATE 95

NOTE 145p.; Oversized poster not included in ERIC copy.AVAILABLE FROM Foreign Policy Association, 729 Seventh Ave., New

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EDRS PRICE MF01/PC06 Plus Postage.DESCRIPTORS Financial Policy; Foreign Countries; Foreign Policy;

Global Approach; Higher Education; Immigration;*International Education; Secondary Education; SocialStudies

IDENTIFIERS *United Nations

ABSTRACTThis publication's lead article features the United

Nations' (UN) 50th anniversary, examining how effective the UN hasbeen since it superceded the League of Nations, how the UN has grown,and how well it has supported peacekeeping operations andhumanitarian policies in the world. Other topics for discussionincluded in this volume are: nuclear proliferation; Russia and itsneighbors; The Middle East; global finance; China, Taiwan, Hong Kongand U.S. challenges toward them; an end to open doors in immigration;and promoting democracy. Opinion ballots covering the eight differenttopics are presented along with the results of 35,003 opinion ballotsreceived by the Foreign Policy Association as of June 30, 1994. Anindex to Great Decisions topics from 1984 through 1994 is alsoincluded. The teacher's guide offers activities and lesson plans,including five handout master sheets, coordinated with the topicspresented in the document. (JAG)

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An InvitationHE FOREIGN POLICY ASSOCIATION, publisher of the GREAT DECISIONS briefing book and sponsor of the

nationwide Great Decisions discussion program, invites you to become a National Associate. Your

participation as a National Associate will enable FPA, an independent, nonpartisan educational organiza-

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will be listed in next year's briefing book.

JOIN THE THOUSANDS of people across the U.S. who share your interest in internationalaffairs and foreign policy, and participate in a Great Decisions discussion group inyour community. Sponsors include the League of Women Voters, UNA-USA chap-ters. "Y's," World Affairs Councils, churches and synagogues, and libraries. Or startyour own discussion group.

To start your own group:

1. Assemble a group of 8-12 people. Recruit your friends or find members inneighborhood or civic groups. the library, church or synagogue.

Purchase a copy of GREAT DECISIONS for each participant. Call orwrite the Foreign Policy Association for the nearest Coordinator or Re-gional Organizer. or. if there is none in your area. order directly from FPA.

3. Determine a meeting schedule. Many groups meet weekly or biweekly.beginning in late January or early February. Other groups prefer a fallmeeting schedule or a monthly schedule throughout the year.

4. Select the leadership for the group. Some groups prefer to have the sameperson lead all eight sessions, while others rotate the leadership responsi-bilities among group members.

5. Designate one group member to collect opinion ballots and forwardthem to the Foreign Policy Association. We will make your opinionsknown to the President, the Secretary of State. the Secretary of Defense andMembers of Congress.

Do you have any questions about starting, joining. leading or participating in a Great Decisions group?Please write or call the Department of Programming and Community Affairs at

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EMEMEMER- CONTENTS

Printed by Ripon Cs mum; linters.Ripon, Wionsin

Cover deign: Ed Bohon

Cover photo of UN General Assembly:United Nations

GREAT DECISIONS IS A TRADEMARK OF

THE FOREIGN POLICY ASSOCIATION

riCOPYR IGI r 1995 BY FOREIGN POLICY

ASSOCIATION, INC.. 729 SEVENTH AVE-

NUE. NEW YORK. NEW YORK 10019. ALL

RIGHTS RESERVED. RESEARCHED AS OF

NOVEMBER U. 1991 THE AUTHORS ARE

RESPONSIBLE FOR FACTUAL. ACCURACY

AND FOR THE. VIEWS EXPRESSED. FPA

ITSELF TAKES NO POSITION ON ISSUES OF

U.S. FOREIGN POLICY. PRINTED IN THE

UNITED STATES OF AMERICA. LIBRARY

OF CONGRESS CARD NUMBER: 58.59828.

I. United Nations at Fifty:Reaching Out or Overreaching? by Raymond Carroll 3

2. Nuclear Proliferation:Can It Be Capped? by Ronald J. Bee 15

3. Russia and Its Neighbors:U.S. Policy Choices by Allen Lynch 25

4. Middle East:Lasting Steps to Peace? hr Lawrence G. Potter 37

5. Global Finance:America's Role and Stakes by Robert D. Hortnats 47

6. China, Taiwan, Hong Kong:U.S. Challenges by Joseph R. Gregory 59

7. Immigration:An End to Open Doors? by Karen M. Rohan 69

8. Promoting Democracy:America's Mission? by Richard H. Ullman 81

Opinion Ballots13-14, 35-36, 57-58, 79-80

BEST COPY AVAILABLE

How to get more out of GREAT DECISIONS 92

Opinion ballots: 1994 results 93

Index to GREAT DECISIONStopics (1984-94) 95

No part of this hook may be reproduced in any form,or by any means, without permission in w riting from the publisher.

4

INTRODUCTION -11EISMEMEIHE NOVEMBER 1994 elections changed the country's political landscape. Forthe first time in 40 years Republicans won control of both houses ofCongress. How will this affect the country's foreign policy? Will rancorous

partisan politics interfere with the nation's willingness or even its ability to exercisethe global leadership role thrust upon it by the end of the cold war? The answerswill become clearer once the 104th Congress gets under way.

Although the Constitution places very limited powers at the disposal of aPresident, Presidents and their executive branch advisers have traditionally domi-nated foreign policy. President Clinton's two Republican predecessors, RonaldReagan and George Bush. set the foreign policy agenda for the dozen years theywere in power even though the Democrats controlled one or usually both houses ofCongress.

Despite traditional executive dominance in foreign policy. Congress and thepublic do play a role. In some instances. where the Congress has assessed thenational interest more correctly than the executive, that role has been very influen-tial, according to Paul E. Peterson. a professor of government at Harvard Univer-

sity. Congress refused to appropri-ate funds for Reagan's strategicdefense initiative because itviolated the antiballistic missiletreaty. Congress also cut defenseexpenditures in the mid-1980sbecause the requested budgetseemed out of proportion to theinternational danger.

FPA President John Temple Swing presents the1994 Opinion Ballot Report to Secretary of StateWarren Christopher.

"The need for the executive todefend its foreign policy positionsbefore Congress helps to insure thatforeign policy decisions arecarefully reasoned," writesPeterson. "To the extent that one

branch or another indulges in fanciful myths or ideological thinking, the otherbranch shouldand often doesbecome a more influential participant."

In this time of transition, the need for informed citizens to make their voicesheard by their policymakers in the White House and on Capitol Hill assumesgreater importance than ever. By completing the opinion ballots hat are bound intothis hook and mailing them in to the Foreign Policy Association by June 30. youwill be able to make your voice heard and your views count. As in past years. 1-PAwill tabulate the ballots and. with the help of a public opinion expert. analyze theresults. Copies of the National Opinion Ballot Report will be presented to thePresident. the national security adviser. the secretaries of State and Defense.Congress and the media.

We welcome you to Great Decisions and your participation in the nationalforeign policy debate.

John Temple SwingPresidentForeign Policy Association

EditorialAdvisory

Committee

CHAIRMAN

Richard H. UllmanDavid K.E. Bruce Professor of

International AffairsCenter of International Studies

Princeton University

David B. H. DenoonProfessor of Politics and Economics

New York University

Earl W. FoellFormer Editor in Chief

World Monitor and The ChristianScience Monitor

Christine R. LucasGreat Decisions Coordinator. Ohio

Program Officer,Cleveland Council on World Affairs

Ponchitta A. PierceTelevision Host and Producer

FPA Director

John Gerard RuggieDean, School of International and

Public AffairsColumbia University

FPA Governor

Sanford J. UngarDean, School of Communication,

The American University

Nancy Hoepli-PhalonFPA Editor in Chief

Ex officio

Foreign Policy Association

Paul FordChairman of the Board of Directors

John Temple SwingPresident

EDITOR IN CHIEF

Nancy Hoepli-Phalon

SENIOR EDITORS

Ann R. MonjoK.M. Rohan

EDITORIAL ASSISTANT

June Lee

EDITORIAL INTERNS

Kimberly LantayTatiana L. Mokiebust

COPY EDITOR

James 1. Bauer

DESIGN

K.M. Rohan

United Nations at 50:reach' out oroverreac g?Afterfive decades, the world organization's vision is expanding,a bit too quickly for some members.

by Raymond Carroll

THIS IS A LANDMARK YEAR for theUnited Nations. As it reaches theage of 50, it will be a time to cel-

ebrate its many accomplishments. Ofgreater importance, it will also be a timefor a hard look at the organization's cur-rent condition, its future prospects and itssecretary-general's troubled relationswith its most powerful member, the U.S.Half a century, after all, is almost twicethe life span of the organization on whichthe UN is modeled, the League of Na-tions, which was discredited in the 1930sby its weakness in the face of Japanese,Italian and German aggression, and thendestroyed by the advent of World War II.

With all its much-publicized flaws andGccasional stumbles, the UN has accom-plished much. Though hobbled by the dip-lomatic gridlock created by the cold war,the UN helped mitigate the ideologicalconflict that threatened the world withnuclear incineration. As the old colonialempires disintegrated, it eased the birthof scores of newly independent countries.

The UN won four Nobel Peace prizesfor the work carried out by its blue-helmeted peacekeepers, by the UNChildren's Fund (Unicef) and the UNOffice of High Commissioner for Refu-gees (Unhcr). Projects led by the WorldHealth Organization (WHO), a UNagency, wiped out smallpox and are soonexpected to complete the job of eradicat-ing river blindness, the scourge of WestAfrica.

Since the late 1980s, the UN has beencoming to grips with the immense new

RAYMOND CARROLL is a former Newsweekeditor, author ofThe Future of the UN (NewYork, Franklin Watts, 1985) and freelancewriter.

challengesa second chancecreatedby the crumbling of the Soviet empireand the end of the cold war. With Ameri-cans and Russians no longer at eachother's throats, the Security Counciltheprimary locus of power at the organiza-tionfinally was freed to functionunhampered by the constant threat of theveto. The Security Council for the firsttime could forge the kind of consensusamong the five permanent members(China, Britain, France, Russia, U.S.)required to make strong decisions andemploy significant military power.

The nations and peoples of the UnitedNations are fortunate in a way thatthose of the League of Nations were not.We have been given a second chance tocreate the world of our Charter thatthey were denied.Boutros Boutros-Ghali,

secretary-general

c

To the more optimistic, it seemed fora time as though a "new world order"might be emerging. Though the phrasewas never precisely defined, presumablyit meant the world of law, economic andsocial development, and respect for hu-man rights that the founders of the UNhad hoped for. But it soon became clearthat the world, if anything, had grownmore anarchic, the problems facing theUN and its members more numerous. In-stead of conflicts between states, theworld now found itself beset by ethnicrivalries, civil wars and humanitarian ca-lamities raging inside the boundaries ofrecognized states. "The UN was set up in1945 primarily to deal with threats to thepeace, acts of aggression, and disputesand conflicts between states," saysformer UN Undersecretary General BrianUrquhart. "It is now increasingly per-ceived by the press and the public to be,or to have the potential of being, theworld's police force and humanitarianrescue service."

Without question, demands on the UNfor policing or humanitarian aid, not tomention economic and social services,have grown enormously. More peace op-erations were launched in the early yearsof this decade than in the entire 40 yearsof the cold war. By mid-1994, some70,000 blue helmets from 70 countries

6 GREAT DECISIONS 1993 3

maw NATIONS

were on missions around the worldseven times more than six years earlier.The cost of these peace operations is anestimated $3.2 billion a year, and the UNfinds it harder and harder to get membersto pay their assessed shares of the bill. Inrecent years, the biggest debtor has beenthe U.S. In August 1994, after the U.S.had run up a bill of $748 million for peace-keeping operations and an additional $531million for the regular budget, Congressfinally authorized a payment of $1.2 bil-lion. "It is a miracle, in many ways,"writes the foreign minister of Australia,Gareth Evans, in his book Cooperating forPeace, "that the UN has done as well as ithas in responding to the peace and secu-rity challenges unceasingly hurled at itsince the end of the cold war."

Not everyone is as generous as Evans.The organization is perceived by many inthe media and general public as weak andfloundering. Where, some wonder, is thenew world order once so hopefully envi-sioned? As the secretary-general, a vet-eran diplomat with few illusions, haspointed out: "The passing of an old orderdoes not of itself create a new order."

Boutros-Ghali's visionIn whatever "order" does emerge in theyears ahead, the UNBoutros-Ghali isconvincedmust play a leading role.The organization, as he is well aware, hasenormous built-in weaknesses. It is not asovereign state with its own tax systemand military arm. It has 184 membersand it cannot make important decisionswithout the agreement of the most pow-erful among them, particularly the fivepermanent veto-holding members of theSecurity Council. But the secretary-gen-eral, who took over his post in January1992, is determined to make the UN into"the instrument for dealing with all theworld's post-cold-war problems, theproblems of ethnic conflict, of the envi-ronment, of poverty and development."

This willingness to take on greater re-sponsibility and authority for the organi-zation was reflected in two reports byBoutros-Ghali: An Agenda for Peace(1992) and An Agenda for Development(1994). Both were applauded for theiractivism by many members of the orga-nization, but the more powerful coun-tries, and some smaller ones as well,wary of any drift toward suprana-tionalism, regarded the secretary-general's policy papers with varying de-grees of suspicion and distaste.


P

44.

t

EDUCATING WOMEN is a development priority.An evening adult education class in southernSudan, using Unicef workbooks.

The first was done at the request of theheads of the 15 countries represented onthe Security Council in January 1992.They asked the new secretary-general torecommend ways to strengthen the UN'scapacity for maintaining peace and secu-rity in the post-cold-war era. In June ofthat year, he produced An Agenda forPeace, in which he outlined an ambitiousplan to expand the organization's abilityto deal with the new varieties of threats topeace and proposed a more energetic useof preventive diplomacy. Boutros-Ghalialso implied that traditional concepts ofnational sovereignty need not necessarilystand in the way of intervention by UNtroops within a country's borders, with orwithout the consent of the local parties.Though Boutros-Ghali did state that re-spect for the fundamental sovereignty ofstates remains crucial to international or-der, he added: "The time of absolute andexclusive sovereignty...has passed."

Since a commonly held view of sover-eignty is that events within a given coun-try are no business of the outside world,the secretary-general's statement dis-turbed many members. If any country'ssovereignty could be infringed on by theSecurity Council, who might not be acandidate for intervention some day?

The proposals that attracted the mostattention concerned the use of militaryforce. At present. whenever the SecurityCouncil requires armed might to carry

out its decisions, the force must bescraped together, often with considerabledelay. To strengthen the UN's hand, thereport called on member states to placesizable units of their armed forces on apermanent "standby" basis, meaning theywould remain under national control, forthe Security Council's use when deemednecessary. In addition, Boutros-Ghaliproposed the creation of smaller "peace-enforcement units" composed of highlytrained volunteer units from the forces ofmember states, to be made available oncall to the Security Council for dangerousassignments.

Since its appearance, the report hasgenerated much discussion but little prac-tical response. The more powerful mem-bers, including the U.S., have argued thatthe organization is already overextendedand should not be given new responsi-bilities or power.

In Washington, the attitude toward theUN has turned especially sour. TheClinton Administration, initially an ar-dent supporter of multilateralism and UNpeace operations, has undergone achange of heart. An ill-conceived actionin Somalia, in which 18 American sol-diers lost their lives, led to a backlashagainst UN peace operations in publicopinion and in Congress. The WhiteHouse issued new policy guidelines thatnot only set strict conditions for U.S. par-ticipation in peace operations but for sup-porting any new UN peace missions.

Human developmentIf Boutros-Ghali had lost support amongthe great powers for his views on peaceoperations, he did not let it temper hisenergetic approach to a second major con-cern of the organization, development.

In An Agenda for Development, issuedin May 1994, Boutros-Ghali talked of"the new vision of development that isemerging." This vision stresses "humandevelopment"social, cultural and po-litical, as well as economic. Thesecretary-general did not disparage"macroeconomic" development but heemphasized that programs must also domore to improve the lives of individualsdirectly, through the creation of jobs,through attention to human rights, thestatus of women and democratic pro-cesses, and through greater attention tothe environment.

Noting that some critics faulted theUN for placing greater emphasis onpeace and security than on development,

UMW MADONS

Boutros-Ghali said these fears were notjustified. In an interview with British TVshow host David Frost, he stated thatonly 20% of the activities of the UN con-cerned peace, while "80% are dealingwith economic cooperation, cultural co-operation, problem[s] of human rights,democratization."

Still, in An Agenda for Development,Boutros-Ghali insisted that membercountries must pay even more attentionto global development andthough "do-nor fatigue" might be understandablethey must increase aid and find ways toease the debt-burden that cripples somany low-income countries. Without "adeeper moral commitment" to global de-velopment by members, he warned, "a

half century of considerable progresscould be undermined."

The secretary-general clearly believesin a UN that would make the most of itssecond chance by taking on a larger role.For this to happen, the major powers, andespecially the U.S., would have to agreeto give the UN much greater political andfinancial backing than at present. But, infact, they have become less than stalwartin their support.

Should the U.S. be more supportive ofthe UN? Does the UN need more poweror less? Is the UN under Boutros-Ghalitrying to do too much? Just what is it thatthe U.S. wants the UN to do about main-taining peace and improving the lot ofthe human race?

Learning to say no0 NE AFTERNOON in 1993, Secretary

General Boutros-Ghali briefed themembers of the Security Council on themore than 20 trouble spots in the worldwhere the UN was involved either as amediator or peacekeeper. When he fin-ished, the Spanish representative won-dered aloud whether the organizationmight not be taking on too many tasks.Boutros-Ghali replied that the UN couldnot turn away any country, no matterhow insignificant, that requested its assis-tance. "We would," he said, "be accusedof discrimination and double-dealing."

This exchange spoke volumes aboutone of the major problems afflicting theUN. The demand for the organization'sservices in the realm of peace and secu-rity has grown at an amazing pace. At thesame time, the UN is on the brink ofbankruptcy, remains dependent on reluc-tant members for money, manpower andmateriel, and sometimes seems unable tocope with its growing responsibilities.Kofi Annan, the Ghanian diplomat whoheads the UN's peace operations, statedbluntly last March: "Frankly, if the re-sponse of governments remains the wayit is today, we couldn't get another opera-tion off the ground."

Annan's job clearly had become exas-perating. During most of the UN's his-tory, small numbers of lightly armedpeacekeeping troops typically were posi-tioned between hostile forces to helpmaintain cease-fires and prevent new out-breaks of violence. When this modest

and raretype of operation succeeded,as it has in the Golan Heights, the Sinaiand along the Indo-Pakistani frontier inKashmir, it was because both sideswanted the UN forces to be there, wantedthe shooting to halt and were in com-mand of disciplined military forces. Theparties to the conflict were recognizedcountries, members of the UN, who re-spected the missions of the men in theblue helmets, soldiers who used theirweapons only in self-defense.

Only in exceptional cases like the Ko-rean War (1950-53) and the former Bel-gian Congo turmoil (1960-64) did troopsactually do battle under the UN flag. In1990, the Security Council again sanc-tioned force, placing its stamp of legiti-macy on Operation Desert Storm, the re-markable 28-member military coalitionled by the U.S. that punished Iraq for itsseizure of Kuwait.

But reckless, Iraqi-style aggression byone state against another across recog-nized borders is not likely to become acommon occurrence. These days, mostserious conflicts have been taking place,and probably will continue to take place,within and not between recognized na-tions. They are likely to be partly ethnic,religious or secessionist in nature, or theymay be factional disputes among purelydomestic political rivalsthe kind ofcivil strife that can produce great distress.including mass starvation, and the shock-ing television footage that moves peopleto demand action. Since action usually

involves armed force, and since most in-dividual countries or regional groups areunwilling or unable to take on such as-signments, nations routinely turn to theUN.

Retreat from multilateralismFor a time, the Security Council, em-boldened by its post-cold-war ability toreach consensus, voted for resolution af-ter resolution committing the UN to un-dertake military missions of a wide vari-ety in Asia, Central America, Africa andEastern Europe. Then harsh realities be-gan to intrude. In some internal struggles,governments were not in control, some-times barely in existence. Combatants,imbued with communal or nationalisticpassions, were often uncontrollable. UNtroops were not always welcome. A hu-manitarian operation in Bosnia becamebogged down in the midst of an intrac-table civil conflict. Stung by the loss ofAmerican lives in Somalia, the ClintonAdministration retreated from support of"assertive multilateralism" to skepticismabout most UN peace operations. Othermajor countries followed the Americanlead. Money and men for peace missionsbecame scarcer.

The increasing demands were indeedpart of the problem. But another part wasthe understandable inclination ofBoutros-Ghali himself and his chief ad-visers to expand the UN's peacekeepinghorizons beyond the mere policing ofcease-fires. In this, the five permanentmembers of the Security Council consis-tently acquiesced. (It must be noted thatthe U.S., during the Bush and earlyClinton Administrations, backed all theSecurity Council resolutionsand initi-ated somethat expanded the scope ofthe UN's peace operations.)

Peacekeeping victoriesSome of these ground-breaking, "secondgeneration" peacekeeping missions wereextremely successful. The first was thedeployment of about 6,000 troops andcivilian experts in Namibia in 1989. Withthe sometimes reluctant cooperation of theSouth African government, the UN forcenot only provided security but organizedand supervised elections that guided theSouth-West African land peaceably fromtrusteeship to independence.

Ali even more ambitious operationwas launched in 1992 in Cambodia.where years of Khmer Rouge terror, fol-lowed by Vietnamese occupation and

GREAT DECISIONS 1995 5

civil war, had all but destroyed the coun-try. Carried out by 22,000 military andcivilian personnel, this mission repatri-ated hundreds of thousands of refugees,enforced at least a partial truce amongthe rival armies, supervised an interimgovernment, protected human rights, andconducted a national election. It tried toplace Cambodia on the road to demo-cratic, constitutional government.

In other, less-comprehensive but com-plex operations, UN forces monitored acease-fire, separation of forces and anelection in Nicaragua; helped the Organi-zation of American States conclude apeace accord, then monitored humanrights, an election, the purge of rights-abusers from the military and the distri-bution of land to demobilized soldiers inEl Salvador; monitored the withdrawal ofCuban troops, a cease-fire and election inAngola, the results of which the loser re-jected before resuming war against thegovernment.

As of late 1994, a number of othersecond-generation peacekeeping opera-tions, most of them conducted by smallnumbers of troops, were also under wayin Georgia, Liberia, the Western Saharaand Mozambique. In addition, a uniqueexperiment in "preventive deployment"is being conducted in the FormerYugoslav Republic of Macedonia. Thegovernment feared that its territory mightbe violated and asked that UN troops besent to secure the borders. In an unprec-edented step, the Security Council sent1,050 military observers and civilian po-lice to the Balkan state, where they re-mained at the end of 1994, a successfuldeterrent to aggression.

Besides preventive deployment,Boutros-Ghali proposed in An Agendafor Peace a greater use of preventive di-plomacy, including more aggressive fact-finding about potential trouble spots, thesetting up of demilitarized zones and ear-lier efforts at resolving disputes beforethey evolve into outright conflicts. More-over, he endorsed the expansion of theSecurity Council's capacity to authorizeforce, even in situations traditionally re-garded as solely within the province ofnational governments.

This latter point, the expanded use ofenforcement, has become the most con-troversial aspect of recent UN peace mis-sions. In the 45 years prior to 1990, onlytwo UN operationsKorea and theCongowere authorized to use force forany purpose other than self-defense.

6 GREAT DECISIONS 1 99S

UMW NATIONS

Since 1990, the UN has approved fourmore: in Iraq/Kuwait, in Somalia, inBosnia and in Haiti.

The Iraq precedentSome UN-watchers believe the PersianGulf war triggered by Iraq's occupationof Kuwait was a "defining event" for theorganization. It began as no more thancollective resistance to a classic exampleof aggressiona breach of internationalpeace considered in the UN Charter aswarranting the use of such military force"as may be necessary." Few countriesopposed that. It was only after the defeatof Iraq and after its terms of surrenderwere concluded that controversy arose asthe Security Council considered Resolu-tion 688.

The resolution stated that Iraq's re-pression of its Kurdish minority threat-ened "international peace and security"in the area; it demanded an end to the re-pression and insisted that Iraq "allow in-ternational humanitarian organizationsimmediate access to those needing assis-tance"; and it called on member states to"contribute" to those humanitarian ef-forts. Countries opposed to the measureargued that Iraq's Kurdish problem wasstrictly a domestic affair, did not threateninternational peace and therefore was nobusiness of the UN. The resolution, saidthe Yemeni ambassador, "sets a danger-ous precedent."

Backers of the resolution, led by theU.S., Britain, France and the then SovietUnion, argued that the flow of Kurdishrefugees across the Turkish and Iranianborders in itself constituted a threat to in-ternational peace. A second argument,advanced chiefly by Britain and France,was more radical in its implications. Asthe French representative put it, Iraq'sviolation of its citizens' human rightsamounted to "a crime against humanity"and therefore was of international con-cern, whether or not it was a threat to thepeace. After the passage of Resolution688 (10 in favor, 3 against, 2 absten-tions), the victors of Operation DesertStorm interpreted its call for memberstates to "contribute" to humanitarian as-sistance as legal justification for estab-lishing a protected zone for Kurds innorthern Iraq and for imposing a "no-fly"zone barring Iraqi flights over Shiite ar-eas in southern Iraq.

The debate over Resolution 688 raisedimportant questions: Is there a new rightof hurlanitarian intervention that applies

even in the absence of a credible threat tothe peace and without consent of the par-ties to a conflict? Would the SecurityCouncil now have a precedent for furtherexpansion of its authority?

In the case of Bosnia-Herzegovina,the Security Council originally sent theblue helmets on traditional cease-fire du-ties. Later, they were authorized to pro-tect relief supplies, and establish safezones for civilians and deter attacksagainst them. For these purely human',tarian purposes, they were permitteduse force, which some members believedwas contrary to the UN Charter.

Somalia is a clearer example of mili-tary intervention for humanitarian pur-poses. There the inspiration for UN ac-tion was, from the beginning, completelyhumanitarian: to deal with a disastrousfamine brought on by internecine warfare.When local warlords disrupted the I JN aidmission, the Security Council authorizedintervention by a heavily armed Ameri-can-led coalition. No national governmentwas then in place in Somalia to f,ive con-sent or deny it. No credible threat to in-ternational peace existed; the SecurityCouncil, however, cited such a "threat"to legitimize its forcible intrusion.

In its early stages, the operation savedmany from starvation, but conflicts be-tween the U.S. and the UN over policyand tactics, a decision to use force againstone of the warlords, and subsequent lossof life among UN troops led to widespreadcriticism of the operation and the worldbody itself. So disenchanted with humani-tarian peacekeeping did the U.S. and othercountries become that when hundreds ofthousands of minority Tutsis were beingmassacred in Rwanda in the spring andsummer of 1994, Boutros-Ghali was un-able to win commitments of either man-power or money to stop the carnage.

Haiti: restoring democracyIn August 1994, the Security Councilciting human-rights violations by the rul-ing junta in Haitiauthorized members(i.e., the U.S.) to use "all necessarymeans" to restore democratic government.Once again the Security Council, underprodding this time from the U.S., had au-thorized a military operation and, said TheNew York Times, "recklessly stretched theboundaries of what constitutes a threat tointernational peace and security."

To some supporters of the UN, theexpansion of the Security Council's poweris a welcome development. Former U.S.

UNITED NATIOVAS

BALKANSf/

Forces: 34,940Annual cost: $1.2 bil.Date sent: Mar. 1992ks,- %'

CYP US

Forces: 1,218Annual cost: $47 mil.Date sent: Mar. 1964

ISRAELI BORDERS LEBANON

Forces: 1,251Annual cost: $62 mil.Dates sent: June 1948 & 1974

Forces: 5,231

Annual cost: $145 mil.Date sent: Mar. 1978

N SAHARA

Forces: 310Annual cost: 140 mil.Date sent: Sept. 1991

GEORGIA

Forces: 21

Annual cost: 17 mil.Date sent: Aug. 1993

IRAQ-KUWAIT

Forces: 1,147Annual cost: 173 mil.Date sent: Apr. 1991

Forces: 250Annual cost: 124 mil.Date sent: July 1991

INDIA-PAKISTAN,

Forces: 40Annual cost: 18 mil.Date sent: Jan. 1949

LIBERIA

Forces: 370Annual cost: 170 mil.Date sent: Sept. 1993

Total Forces Woildwide: 70,442Forces Indude troops, observersand dviltan poke

Source: United Nations

IIIlkSOMALIAANGOLA MOZAMBIQUE

Forces: 77Annual cost: 125 mil.Date sent: June 1991

RWANDA

Forces: 5 929Annual cost: 1329 mil.Date sent: Dec. 1992

Forces: 706Annual cost: 198 mil.Date sent: June 1993

For es: 18,952Annual cost: $1 bil.Date sent: Apr. 1992

:where ut4 Forces:Om 3 0,Peact.,,;(at of May 31(1994)

Ambassador Max M. Kampelman, forexample, believes there is a "shifting di-viding line" between those internal affairsthat should be protected against interven-tion and the responsibility of the "inter-national community" to intervene in de-fense of peace or important human val-ues. But who determines where that di-viding line is in specific cases? "It is evi-dent," says Kampelman, "that it is the UNSecurity Council, which, by its decisions,places the legal imprimatur between whatis justifiable and unjustifiable interna-tional intervention."

Boutros-Ghali agrees with this view.When asked what "allows" the UN to in-tervene in essentially national matters, hereplied: "It is a political decision, becausethe Security Council is a political body.They will decide when they will enter andwhen they prefer to avoid to intervene."

Not every friend of the UN is com-fortable with the Security Council'swidening reach. Australian Foreign Min-ister Evans believes that humanitarian-motivated peace enforcement mightsometimes be justified, but he suggeststhat the Security Council learn to ignorepopular pressure and weigh the conse-quences of its decisions more carefully inthe future. Observing that the UN is oper-ating in a "no-man's land" in terms of in-ternational law, former U.S. Ambassador

to the UN Donald McHenry has askedwhether the UN may not be in danger ofgetting too far ahead of its members. Hisanswer: "Yes, it is in danger."

Most discouraging of all for Boutros-Ghali has been the criticism of prominentleaders like President Bill Clinton, wholectured the UN on the need for restraint,and British Foreign Secretary DouglasHurd, who argued that crises in Bosnia,Somalia and elsewhere might be "trag-edies" but were not threats to interna-tional peace.

In a closed-door meeting with the sec-retary-general in December 1993, the for-eign ministers of the five permanent mein-bers of the Security Council made it clearthat the UN would have to contain its ap-petite for peace operations. They pledgedto strengthen the organization's "capabili-ties" but stated that "new commitments"should be made with the greatest caution.

Boutros-Ghali has remarked that "theinternational community is now in re-treat." Asked what he would do about it,the secretary-general shrugged: "I mustaccept reality. I also must continue to giveyou my view."

The human elementThe term "development," in today's UNlexicon, is a many-sided thing. Instead ofconcentrating on the trickle-down ben-

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efits of economic growth, the gurus ofdevelopment at the UN have set theirsights on human development. The goalis to improve as rapidly as possible thequality of life for millions of peoplearound the world while at the same timepreserving the earth's environment. "Itis," says James Gustave Speth, adminis-trator of the UN Development Program,"development that is pro-people, pro-nature, pro-jobs and pro-women."

From the start, the UN's concern foreconomic and social issues was over-shadowed by its activities in pursuit ofpeace and security. In the organization'searly days, UN multilateral economicassistance programs were initiated andfinanced by wealthier members (such asthe U.S.) to benefit newly independentcountries, chiefly in Africa and Asia.

As the cold war intensified and theU.S. and the Soviet Union contended forglobal influence, the two sides pouredvast sums into development-finance andtechnical assistance for countries of theThird World. These country-to-countryprograms were often interwoven withmilitary aid and political strings. With theend of the cold war, says Boutros-Ghali,"the poorest countries no longer hold thesame interest for the rich...."

Over the years, the UN has beenhandicapped in its efforts to help the

GREAT DEcisioNs 1905 7

wino"have-nots." Donors preferred to funnelaid abroad through bilateral agreementsor the World Bank, where voting strengthdepended on the financial contributionsof the members ("one dollar, one vote" asagainst "one country, one vote" in theUN proper).

Despite this poor-relation status, theUN has had its share of success in thefield of development. Unicef has workedtirelessly to improve the education andnutrition of children and saved countlesslives through its immunization cam-paigns against childhood diseases;Unhcr, in collaboration with other UNagencies and private relief organizations,has led the international effort to alleviatethe misery of millions of people uprootedby ethnic tensions, civil conflict, human-rights violations, drought and famine; theUN Population Fund (Unfpa) has pro-moted family planning around the worldand provided advisers and funds to helpnational population programs; the UNDevelopment Program (UNDP), thework organization's largest provider ofdevelopment grants, concentrated in thepast on helping countries improve theiroverall economies, but it now has broad-ened its scope to fund projects aimed atalleviating poverty, improving social pro-grams and judicial systems, and protect-ing the environment.

Unfinished businessThese achievements, along with those ofother UN agencies, individual govern-ments and private organizations in thefield of international development, havedone much to bring about the global risein income and life span, the decline ininfant mortality and the vastly improvedlevels of education. nutrition and sanita-tion that have occurred in the past 50years. Nevertheless, poverty, unemploy-ment, environmental outrages and socialills of all kinds still exist almost every-where.

The statistics of deprivation and dis-tress are chilling: despite technologicaladvances and an incredible amount ofmaterial abundance, the UN estimatesthat a fifth of the developing world'spopulation goes to bed hungry everynight, a quarter lacks access to basic ne-cessities such as safe drinking water anda third lives in abject poverty.

The persistence of such widespreadeconomic distress, and the growth of glo-bal awareness in recent years of issuessuch as the environment, overpopulation,

8 GREAT DECISIONS 1995

VICE PRESIDENT AL GORE, leader of the U.S. delegation, addresses the population conferencein Cairo. The U.S., the largest donor, pledged to devote $595 million to population programsin fiscal year 1995.

and the status of women and children,have combined to create a strong demandfor the UN to expend more of its effortson human development. In response,Boutros-Ghali wrote An Agenda for De-velopment, a complicated document,written less for the general public thanfor Secretariat officials and the diplo-matic corps. It offers some provocativethoughts:

Without proper national policies,including market economies, socialsafety nets, judicious regulatory directionand attention to the environment, noamount of aid will lead to sustainedgrowth. "The state gives an impetus togrowth; but it is the economy that needsto grow, not the state itself."

To encourage progress in the de-veloping nations, ways must be found toease the debt-burden of low-incomecountries, lower trade barriers to theirproducts and encourage the flow of capi-tal and technology into their economies.Only changes in the polices of the majoreconomic powers can bring about thenecessary improvements.

Human development is a requisitefor stable progress. "A population that isilliterate and uneducated cannot hope tocompete.... A society where women arediscriminated against or lack equal op-portunities cannot reach its full humanpotential."

Democracy is a fundamental humanright. Moreover, by giving competing eth-nic, religious and cultural interests a voice

1I

in civil affairs, it minimizes violent con-flict and thereby creates the most fertileand reliable political soil for development.

Sensitive to charges that the UNslights development activities, Boutros-Ghali points to its recent global treatiesand conferences. One example is the UNConvention on the Law of the Sea. Aftermany years of difficult negotiations,chiefly dealing with American objec-tions, it finally took effect in November1994. It deals with many internationalaspects of the use of the sea and its re-sources and is expected to have an enor-mous impact on global economic and en-vironmental conditions. Moreover, thesecretary-general notes the great interna-tional conferences the UN has sponsored.

The first of these blockbusters, the UNConference on Environment and Devel-opment (Unced), deserves particular at-tention. Held in Rio de Janeiro, Brazil, inJune 1992, it attracted more than 100heads of state and government and legionsof officials from over 170 countries.

Given the sharp differences of opinion,and the problems involved in encourag-ing development and at the same timeprotecting the environment, it was surpris-ing that any agreement was reached. Yet,over 150 countries approved two bindingconventions, one on climate change(requiring signatories to reduce emissionsof gases believed to contribute to globalwarming) and the other on biologicaldiversity (prescribing steps for the protec-tion and ise of the world's plant and ani-

moo NATIONS

mal species). President Bush signed theclimate convention but refused to sign thediversity convention, objecting to its fi-nancial arrangements and the lack of pro-tection for intellectual property. (It waslater signed by President Clinton's ambas-sador to the UN.)

In addition, the conferees signed a"Rio Declaration" pledging allegiance toenvironmental principles and a documentdesigned to conserve the world's forests,both of which were nonbinding andwidely regarded as too tame to be useful.Perhaps more effective was Agenda 21, a500-page blueprint listing over 2,500 tar-getsranging frow the management ofradioactive waste to the alleviation ofpovertyfor action on a local, nationaland global level. Cautiously satisfied,conference chairman Maurice F. Strongsaid "Rio was not just an event but thelaunch of a long-term process."

NGOs: partners indevelopment

A notable aspect of the Rio Earth Sum-mit was the extraordinary role played bynongovernmental organizations (NGOs).About 1,800 from all parts of the worldwere accredited by the UN as observersand were allowed to address the negotiat-ing committee or make written submis-sions at the chairman's discretion. Thou-sands more had no official standing butheld their own hearings, buttonholed theconferees and generated media attention.Agenda 21, in fact, recognized the NGOsas "important partners" in the pursuit ofdevelopment.

The World Conference on HumanRights, held in Vienna, Austria, in June1993, was as contentious as the Rio EarthSummit. But, a Vienna Declaration andProgram of Action was agreed upon, sat-iscying the West by committing all states,regardless of their cultural differences, toprotect basic human rights, and pleasingthe less affluent countries by reaffirmingthe "right to development."

As in Rio, the NGOs in Vienna werenumerous and vocal. They also turnedout in force at the International Confer-ence on Population and Developmentheld in Cairo, Egypt, in September 1994;there they exerted considerable influenceon the debates and the final "program ofaction." Two more important conferencesare planned for the 50th anniversary ofthe UN: the World Summit for SocialDevelopment to be held in Copenhagen,Denmark, and the fourth in the series of

world conferences on women in Beijing,China.

What impact does all this conferringand advocacy have on UN policy andUN action? Even more important, whatimpact does it have on the governmentsand people of the member countries?

At the very least, the cycle of confer-ences raises awareness about the prob-lems of development and may even raiseuniversal standards of conduct. To dem-onstrate his own commitment, Boutros-Ghali has shaken up the UN bureaucracyby appointing officials dedicated to activ-ism under the banner of "human develop-ment." He is seeking ways to strengthenthe UN Economic and Social Council(Ecosoc) to bring coherence to the arrayof UN agencies dealing with develop-ment. And though well aware of donorfatigue, the secretary-general has fre-

'uently reproached the wealthier coun-tries of the world for falling short in theirassistance.

In the end, the course of develop-mentimproving the quality of life forall peoplewill depend in large part onthe actions of governments, national andlocal. It will also depend on the pressuresthat community groups and NGOs canbring to bear on their governments. In thepast few years, says Maurice Strong,there has been a "virtual explosion of ac-tivities and initiatives on the part ofgrass-roots organizations" working forcauses related to global development. Foractivists like Strong, that is good news.But for governments, especially those ofthe more affluent countries, many otherissues still command far more attentionand translate more readily into votes thanhelping people in distant places.

A new rolefor America?

HIS fiRST ADDRESS to the UN Generalssembly, in September 1993, Presi-

dent Clinton complained about the prolif-eration of UN peace operations. "The UNsimply cannot become engaged in everyone of the world's conflicts," he said. "Ifthe American people are to say yes toUN peacekeeping, the UN must knowwhen to say no."

Clinton's words were meant, in part,to fend off congressional critics of hisAdministration's support for UN peaceoperations and to reassure Americansthat U.S. troopsthen taking part in anincreasingly dangerous mission in Soma-liawere not going to become globalpolicemen. They also were meant to cau-tion Secretary General Boutros-Ghali andthe world at large that the UN SecurityCouncil must start being more selectivein responding to the growing number ofcalls for UN intervention.

Boutros-Ghali was not happy with thePresident's remarks. As a permanentmember of the Security Council, the U.S.can veto any resolution, and it had saidyes to every one of the 17 peaceoperations then in the field. NowPresident Clinton appeared to be chang-ing his tune. "Staying power is crucial,"the secretary-general commented. Theforces of chaos would prevail if they

"conclude that the UN is short of breath."This open dispute between Boutros-

Ghali and the President came as a surpriseto some UN-watchers. Over the years, theU.S.-UN relationship had known its shareof ups and downs. But since the end ofthe cold war, it had been on the up side.As a campaigner for the presidency,Clinton promised support for collectiveaction and even endorsed the establish-ment of a small, permanent UN rapid de-ployment force for "standing guard at theborders of countries threatened by aggres-sion, preventing mass violence againstcivilian populations, providing humanitar-ian relief and combating terrorism."

In the early days of Clinton's presi-dency, these sentiments were echoed byhis secretary of state, Warren Christopher,and his ambassador to the UN, MadeleineK. Albright. Only a few months before hisspeech to the UN, Clinton had praised itsmission in Somalia and the Security Coun-cil for giving it orders to hunt down war-lord Mohammed Farah Aidid for the kill-ing of 23 Pakistani peacekeepers in anambush. "We're striking a blow againstlawlessness and killing," the President hadtold a radio audience, "and we're advanc-ing the world's commitment to justice andsecurity."

What caused the change in the


IMOD NATIONS

Administration's attitude toward the UNover the summer of 1993?

For one thing, it became clear that theAmerican people were in no mood for aninterventionist foreign policy. Theywanted no part of Bosnia; that was a Eu-ropean problem. Appalled by the starva-tion in Somalia, they had supportedPresident Bush's action in sending U.S.troops to aid in the humanitarian effort.The killing of the Pakistanis in June wasdistressing. But in August, four U.S. sol-diers were killed. Although AmbassadorAlbright declared "we must persevere,"the American public wanted out.

So did many members of Congress.Sen. Robert C. Byrd (D-W. Va.) andSenate Minority Leader Bob Dole (R-Kan.) called for the withdrawal of theAmerican troops remaining in Somalia.Both the House and Senate passed non-binding resolutions with deadlines for atroop pullout.

Congressional belligerence combinedwith public anxiety to send a message tothe White House: support for unpopularpeace operations could have unfortunatepolitical consequences. The message wasnot ignored. In telling the UN that it mustlearn to say no, President Clinton wastelling all concerned that his Administra-tion also planned to follow that advice.

A disastrous clash between U.S.Army Rangers and the followers of General Aidid in the Somalian capital ofMogadishu October 3-4, 1993, added

I even greater strain to Washington's tieswith the UN. Televised pictures of a heli-copter pilot's corpse being draggedthrough the streets caused many Ameri-cans to ask: Why are we involved in acountry that is of no vital interest to theU.S.?

In a TV address, Mr. Clinton was cau-tious. He rejected calls for an immediatewithdrawal but promised to have almostall U.S. troops out within six months. Toprepare the way for withdrawal "on ourterms," the President ordered over 5,000new troops to Somalia. But he empha-sized that they would be under Americancommand and that their mission wouldbe defined by the U.S. and not the UN.

The President seemed to he blamingthe UN for the military action that costAmerican lives. Moreover, he did not ac-knowledge that it was launched purely onAmerican orders by U.S. special forcc..swho were not under UN command. In atense meeting with Ambassador Albright,Boutros-Ghali made known his displea-

.


sure with the thrust of Mr. Clinton'sstatement and reemphasized his beliefthat a pullout of U.S. troops would de-stroy the Somalia peace operation. A fewdays later, he was still angry. "If it helpsthe Americans solve theirs [problems] byblaming me, I'll be their scapegoat," hetold an interviewer. "Let us be very prac-tical. I need the U.S."

The Haiti operationAs the situation in Somalia turned uglier,it became clear to the White House thatrethinking its participation in UN peaceoperations was in order. Events in Haitimade that doubly plain. A plan workedout between the U.S. and the UN wouldhave returned the ousted, democraticallyelected Jean-Bertrand Aristide to thepresidency of that country. But the opera-tion failed miserably. The U.S. cargoship Harlan County, carrying the Ameri-can and Canadian advance guard of aninternational force, was confronted at thedockside by a gang of armed demonstra-tors loyal to the military junta whoscreamed, "We are going to turn this intoanother Somalia." Rather than risk newbloodshed, the Clinton Administrationordered the ship back to its U.S. port; thiseffectively derailed the UN mission, tothe delight of Pentagon officials who op-posed sending American troops to Haitito restore Aristide to power.

All through the winter of 1993-94 andinto the spring, discussions went onamong Clinton's top policy advisers andcongressional leaders. With each passingmonth, the policy guidelines that beganto emerge stressed the limitations ratherthan the virtues of UN peace operations.In May 1994, the Clinton policy onpeacekeeping was finally unveiled byAnthony Lake, the President's nationalsecurity adviser. The new guidelines didnot reject peacekeeping but proposed touse it "selectively and more effectivelythan has been done in the past."

How will the U.S. choose when to be-come involved? Or when to support anypeace operation at all?

Generally speaking, said Lake, theClinton policy will be to seek "collectiverather than unilateral solutions to regionaland intrastate conflicts that don't touchour core national interests." Specifically,before the U.S. approves any new UNpeacekeeping operations. the followingquestions will be considered:

Is there a real threat to internationalpeace and security?

m Do the parties to the conflict consentto the UN presence?

gt3 Will the necessary money and troopsbe available?Is the Security Council's mandate ap-propriate for the mission?Will the troops be allowed to useforce? Is there a realistic strategy forending the mission?If the U.S. is to participate in the

mission, additional questions will beconsidered:sa Does the mission advance American

interests?ri Does the mission's success depend on

U.S. participation?Is there a clear way of ending the U.S.role?

ci Are the command and control ar-rangements acceptable?

a Will Congress support the mission?Not all of these questions need be an-

swered in the affirmative in any givensituation. Still, all are to be considered.Moreover, the new policy states that theU.S. will not support the creation of apermanent UN military force of any sortor contribute troops to such a force. Italso says American troops may be placedunder the "operational control" of foreigncommanders but that those troops wouldstill remain within the overall U.S. chainof command.

Rwanda crisisThe first clear-cut application of the newClinton policy came in mid-May 1994,when the Security Council discussedsending a peace mission of 5,500 to bol-ster the handful of UN troops in Rwanda.The U.S. not only ruled out the use ofAmerican troops but argued that such aforce would be a useless "paper tiger" inthat chaotic land. At U.S. insistence, itwas cut back to 1,000. It would havebeen a mistake to authorize a larger forcewithout adequate preparation, a clear ideaof the mission and the consent of the par-ties, Ambassador Albright later ex-plained. The new Clinton policy, sheadded, was not to make UN peacekeep-ing impossible but successful by "recog-nizing current limitations...by imposingdiscipline even when discipline is hardestto maintain."

The U.S. eventually agreed to the dis-patch of 5,500 troops to Rwanda if Afri-can states supplied them, and it did pro-vide substantial humanitarian aid forRwanda's refugees. But the reluctance ofthe Clinton Administration, and probably

I Aa

Y.

MADELEINE K. AUIRIGHT, the U.S. delegate to the UN, is a Cabinet member and a strong Administration voice in foreign policy.

a majority of Americans, to support a UNmission to a distant, strategically unim-portant country was a far cry from thesizable humanitarian military effortlaunched in response to Somalia's agonya few years earlier. However, where vitalU.S. interests were perceived to be atstake, as in Haiti, the Administrationturned to the Security Council to seeklegitimization for a possible invasion,presumably on behalf of democracy andhuman rights.

For the most part, however, the back-lash against UN peace operations re-mained in full swing in the U.S. In Con-gress, Senator Dole and ethers on bothsides of the aisle, often speaking in termsreminiscent of the isolationism of the1920s, continued to seek ways of gaininga veto over U.S. participation in UNpeace missions. In a May 1994 article inThe Washington Post, Chester A.Crocker, assistant secretary of state forAfrican affairs during the Reagan Ad-ministration, attacked the irresponsibilityof much UN-bashing. "We need force-fully to remind ourselves, our media andour public opinion," he wrote, "that theUN Security Council is a mirror of theactions, inactions, fudges and fantasies ofits leading members, who can veto any-thing they do not like."

In July 1994, Ambassador Albrighttold the National Press Club in Washing-ton that the Clinton Administrationhoped to "reinvigorate, reinvent and re-

form the UN system" and "articulategoals during the UN's 50th year that willguide it during the next 50." But will theAdministration be able to demonstratethat its commitment to a mutually benefi-cial relationship with the UN is strong,steadfast and more resistant to temporarypolitical pressures than it has been? IfAmbassador Albright is right about theAdministration's plans, 1995 should tellthe U.S. a good deal about that commit-ment and the status of the country's tieswith the UN.

The 50th anniversary year might alsobe a good time for Americans to reviewtheir own thoughts on some criticalquestions: What do they want the UN tomake of its historic second chance? Dothey want a stronger UN, with a militaryarm to enforce its decisions? Which U.S.national interests are important enough tojustify committing forces to foreignpeacekeeping? Can the U.S. bring aboutthe necessary changes in the UN that willenable it to chart a course thatinpresidential candidate Clinton's words"builds on freedom's victory in the coldwar"?

U.S. policy options1. As leader of one of the UN's

founding nations, President Clintonshould issue a proclamation reaffirm-ing America's support for theorganization.

Pro: It would help to bolster Ameri-

74

can public support for the UN, improveU.S.-UN relations and generate interna-tional cooperation with the work of theorganization.

Con: It would be an empty gesture, anattempt to gain favor without providingthe substantial aid the UN needs.

2. The U.S. should encourage UNefforts to form its own military arm byrecruiting international volunteers.

Pro: To be more effective in emer-gencies, the UN should have trainedforces ready for action and not have torely on reluctant members to supply themuscle.

Con: The UN cannot be trusted withits own armed force. Given its trackrecord, the Security Council would havean even greater incentive to intervene inthe internal affairs of nations.J 3. To ease the UN's financial plight,the U.S. should back proposals that theworld organization raise money byborrowing from private sources oreven by levying a small tax on interna-tional money transactions.

Pro: The UN's effectiveness has beenhampered because the slow payment ofdues and assessments by members hasmade it a permanent pauper unable to fi-nance worthy operations.

Con: The UN bureaucracy is hope-lessly wasteful. An independent sourceof income would make it even morespendthrift and encourage its pretensionsto supranationalism.

- -GREAT DECISIONS 1445 11

UNITED NATIONS

1. Is the UN under Boutros-Ghali at-tempting to do too much and take on toomuch power? Or is an activist secretary-general what the UN needs at this time?

2. As a member of the UN, does the U.S.have a duty to help in places like Somaliaor Rwanda, where there is no directAmerican interest involved?

3. What should be the role of Congress

in forming U.S. policy toward the UN?Should Congress be able to block thecommitment of U.S. troops to a UNpeace operation by the President?

4. The poorer countries of the worldwould like the UN to pay more attentionto economic and social questions and lessto peace operations. What do you think?

5. The old League of Nations had a sys-tem of mandates giving major powers theright to govern territories deemed notready for self-rule. In the case of today's"failed states," like Somalia, should theUN be able to assume governmental au-thority or delegate it to a regional power?

6. Many people believe that televisioncoverage of foreign events, particularlyof innocent people suffering from vio-lence or starvation, has an inordinate in-fluence on policymakers and leads topoor decisions. The sending of U.S.troops to help Somalia would be an ex-ample. What do you think?

7. Is the UN necessary? What would bethe effect on the world, and on the U.S.,if this 50th year of the UN were some-how to be its last?

8. How can the UN be strengthened toplay a more effective role in the next 50years?

A

0 IIA Up

Boutros-Ghali, Boutros, An Agenda for Development. NewYork, United Nations, 1994. 48 pp. $10.00. The secretary-general's mixed bag of UN development plans and programs.

, "Empowering the United Nations." Foreign Affairs,Winter 1992-1993, pp. 89-102. A view of "historic opportuni-ties" to strengthen the world organization.

Damrosch, Lori Fisler, ed., Enforcing Restraint. New York,Council on Foreign Relations, 1993. 401 pp. $17.95. Analyticalessays by scholars on UN intervention in internal conflicts.

Evans, Gareth, "Cooperative Security and Intrastate Conflict."Foreign Policy, Fall 1994, pp. 3-20. A perspective on worldorder by Gareth Evans, Australia's foreign minister and amember of the Carnegie Commission on Preventing DeadlyConflict.

Issues Before the 49th General Assembly of the UnitedNations. Lanham, Md., United Press of America for the UnitedNations Association of the United States of America, Inc.,1994. 351 pp. $16.00. A thorough examination of issues beforethe General Assembly.

Mandelbaum, Michael, "The Reluctance to Intervene." ForeignPolicy, Summer 1994, pp. 3-18. In the view of this JohnsHopkins University professor of American foreign policy, theproblem is not too much intervention but too little by a feebleUN and spineless members.

Maynes, Charles William. "A Workable Clinton Doctrine."Foreign Policy, Winter 1993-1994, pp. 3-20. The editor ofForeign Policy maintains that the real agenda-setters for U.S.foreign policy "sit not in the White House but in the editorialrooms and press cubicles."

Norton, Augustus Richard, and Weiss, Thomas George, "UN


Peacekeepers: Solders with a Difference." Headline SeriesNo. 292. New York, Foreign Policy Association, Spring 1990.64 pp. $5.95. Insightful discussion of the importance of the neu-tral UN peacekeepers and the fundamental problems of peace-making from 1946 to 1990.

Urquhart, Brian, "Who Can Police the World?" The New YorkReview of Books, May 12, 1994, pp. 29-33. A distinguishedformer undersecretary-general of the UN reviews some bookson the UN and makes some typically incisive remarks aboutcritics of the world organization.

CAMPAIGN FOR U.N. REFORM, 713 D St., SE, Washington, D.C.20003; (202) 546-3956. Goal is to build a restructured UN forworld peace. Publishes a 14-point UN reform program and op-erates a political action committee. Contact for information onthe latest issues concerning the UN.

UNITED NATIONS ASSOCIATION OF THE UNITED STATES OF AMERICA

(UNA-USA), 485 5th Ave., New York, N.Y. 10017; (212) 697-3232. The UNA-USA focuses exclusively on the UN systemand works to strengthen America's partnership with the worldbody. Provides information and educational services on thework of the UN and other global issues for students, scholars,Congress, business leaders and the media. Currently working tocommemorate the UN's 50th anniversary.

UNITED NATIONS CENTER FOR DISARMAMENT AFFAIRS, United Na-tions, Rm. S-3151, New York, N.Y. 10017; (212) 963-6033,Librarian: (212) 963-5600. el Provides information on armscontrol, disarmament and national security. Publications in-clude Disarmament Yearbook, Disarmament Newsletter andDisarmament, a periodic review.

WORLD FEDERALIST ASSOCIATION (WFA), 418 7th St., SE, Wash-ington, D.C. 20003; (202) 546-3950. WFA works to strengthenthe UN and transform the UN into a world federation. Providesfree brochures and conferences that are open to the public.

WORLD WITHOUT WAR COUNCIL, 1730 Martin Luther King Jr.Way, Berkeley, Calif. 94709; (510) 845-1992. NI Supports peace-oriented institutions and encourages intellectual exchange. Listof publications for students and teachers is available.

tf

:OPINION BALLOTS .

How to use the Opinion Ballots: For your convenience, there are two copies of each opinion ballot. Please cut out and mailoneballot per persononly. To have your vote counted, please mail ballots by June 30, 1995. Send ballots to:

FOREIGN POLICY ASSOCIATION, 729 SEVENTH AVENUE, NEW YORK, N.Y. 10019

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1 United Nations at 50

ISSUE A. Regarding U.S. policy toward the UN, the U.S.should:

1. Reaffirm its support for theorganization.

2. Encourage the establishment of apermanent, volunteer UN militaryforce.

3. Support efforts to let the UN raisemoney by borrowing from privatesources.

YES NO

4. Other, or comment

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TOPIC

United Nations at 50

ISSUE A. Regarding U.S. policy toward the UN, the U.S.should:

1. Reaffirm its support for theorganization.

2. Encourage the establishment of apermanent, volunteer UN militaryforce.

3. Support efforts to let the UN raisemoney by borrowing from privatesources.

YES NO



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Nuclear ProliferationISSUE A, To combat the spread of nuclear weapons, theU.S. should:

I To.2 Nuclear Proliferation

pla ISSUE A. To combat the spread of nuclear weapons, the

111U.S. should:

YES NOIII1. Eliminate existing nuclear-weapons I . Eliminate existing nuclear-weapons

stockpiles. ri stockpiles. 3

2. Support a treaty prohibiting the P3 2. Support a treaty prohibiting the riproduction of fissile materials. ii production of fissile materials. N

3. Open U.S. nuclear military facilities 1 3. Open U.S. nuclear military facilities ato international inspection. ti to international inspection. ri

4. Close the U.S. nuclear umbrella. ii 4. Close the U.S. nuclear umbrella. Ell

5. Develop a theater-missile defense E 5. Develop a theater-missile defense 113

system. 51 system. S6. Increase the U.S. defense budget. :.1 IE 6. Increase the U.S. defense budget.

0 57. Other, or comment 7. Other, or commentI I

6 III

First three digits of your zip code:5

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OPINION BALLOTS

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EU MS ISE SE El SE Eli WE MB fel EMI IN E1 Eli EN MI EN Ell IVII ME ME NM MI NE BM ME OE MINE

ISSUE B. For each of the following statements, indicatewhether you agree or disagree:

1. The UN, under Boutros-Ghali. isdoing too much and assuming toomuch power.

2. As a member of the UN, the U.S.has a duty to help in places likeSomalia or Rwanda. where no directU.S. interests are involved.

3. The U.S. Congress should be ableto block the commitment of U.S.troops to a UN peace operation.

4. The UN should pay more attentionto economic and social questionsand less to peace operations.

5. The UN should assume governmentalauthority in cases where states fail toexercise self-rule.

6. Television coverage of people abroadsuffering from violence or starvationhas led to poor decisions by policymakers. 0 0

ISSUE C. What prospect do you see for the UN in 50 years?YES NO

AGREE DISAGREE

4

IN

N

N

1. The UN will have become the dominantforce on the world scene. O 0 3

2. The UN will have evolved into a worldgovernment.

Other, or comment

14

a

ISSUE B. For each of the following statements, indicatewhether you agree or disagree:

AGREE DISAGREE

1. The UN, under Boutros-Ghali, isdoing too much and assuming toomuch power. 0

2. As a member of the UN, the U.S.has a duty to help in places likeSomalia or Rwanda, where no directU.S. interests are involved.

3. The U.S. Congress should be ableto block the commitment of U.S.troops to a UN peace operation.

4. The UN should pay more attentionto economic and social questionsand less to peace operations.

5. The UN should assume governmentalauthority in cases where states fail toexercise self-rule.

6. Television coverage of people abroadsuffering from violence or starvationhas led to poor decisions by policymakers.

ISSUE C. What prospect do you see for the UN in 50 years?YES NO

0

O

aN

a1N

N

N

N

N

1. The UN will have become the dominantforce on the world scene.

2. The UN will have evolved into a worldgovernment.


MI WE Ele BiE OM 41 WM NE ICI Ell& NE ME EC ME WC ER Ell SE MI EN SE NE RE

ISSUE B. The U.S. should make clear to any country try-ing to acquire nuclear weapons that it will use a preemp-tive strike to prevent such an attempt.

I. Agree.

O 2. Disagree.

ISSUE C. With regard to the extension of the NPT, theU.S. should (choose one):

I. Support indefinite extension.

O 2. Support extension for a fixed number of years.

3. Not support extension.

N

N

O

El

ISSUE B. The U.S. should make clear to any country try-ing to acquire nuclear weapons that it will use a preemp-tive strike to prevent such an attempt.

O I. Agree.

2. Disagree.

ISSUE C. With regard to the extension of the NPT, theU.S. should (choose one):

I. Support indefinite extension.

O 2. Support extension for a Fxed number of years.

O 3. Not support extension.

N

N

N

N

I

N

I

1

IN

N

CBI NE IUM WM E1 NI ra es fa me am em um cis me ma Es IR so RR RE sm vs Im no Es ou oi IR RR sm IN vim in am alGREAT DECISIONS 1995

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1

Nuclear proliferation:can it be capped?The next decade, and U.S. policy, could be decisive in holdingthe line against the spread of nuclear weapons.

by Ronald J. Bee

KAZAKHSTAN IS DESTROYING its nuclear missiles, but it still possesses bomb-grade nuclearmaterials. In November, the U.S. secretly removed a large cache of bomb-grade uranium fromKazakhstan to this country for safe storage.

S THE WORLD'S ONLY remainingsuperpower, the U.S. carries a

1 Y...1 heavy load of foreign policy andsecurity burdens. But preventing thespread of nuclear weapons to other states,whether on the Korean peninsula, in thePersian Gulf area or elsewhere, is one ofthe most pressing. Speaking before theUnited Nations in September 1993,President Bill Clinton warned: "If we donot stem the proliferation of the world'sdeadliest weapons, no democracy canfeel secure."

The keystone of the world's nonpro-liferation efforts is the Treaty on theNon-Proliferation of Nuclear Weapons(NPT) of 1968. The NV!' pledges nuclearstates to refrain from helping non-weapons countries to get the bomb and topursue universal nuclear disarmament. Itprohibits nonnuclear countries from re-ceiving or manufacturing nuclear weap-ons and it obliges them to accept inspec-tion to make certain they are not divert-ing nuclear materials from peaceful uses.

Twenty-five years after the treaty en-tered into force, in April 1995, more than160 parties to the NPT will meet in NewYork City to decide whether to extendthe treaty indefinitely or for some fixednumber of years. For nuclear and non-nuclear countries alike, the stakes in-volved in the outcome of the conferenceare enormous.

At present, five countries admit tohaving nuclear arsenals: the U.S., Russia,Britain, France and China. Israel, whilenot acknowledging it, almost certainlyhas an array of nuclear weapons. India,which conducted a "peaceful" nucleartest in 1974, and Pakistan concede thatthey have developed nuclear capabilitiesbut deny having any actual weapons.South Africa has divulged that it didmake six nuclear weapons but claims tohave destroyed them all.

In addition, a sizable number of othergovernments, either in fear of rival statesor hopeful of gaining power and influ-ence of their ownIran, Iraq, North Ko-

rea, Libya, Algeria and Taiwanhavelong been suspected of harboring suchambitions.

New dangersThe danger of nuclear war between theworld's two superpowers receded withthe end of the cold war and the disinte-gration of the Soviet Union. But thosetwo events also created a number of newproblems. Some of the former Soviet re-publics, most notably Ukraine, flauntedtheir hard-won independence by threat-ening to retain control of the nuclear ar-senals still stockpiled on their territories.Even more alarming, the vast supplies ofleftover Soviet nuclear weapons, technol-ogy and know-how are in danger of be-coming a gigantic "nuclear yard sale,"with choice items available for a price tocountries eager to join the nuclear club.Under-the-table transactions add to theperil. In the summer of 1994, German au-thorities arrested a number of peopleattempting to smuggle weapons-gradeplutonium out of the former SovietUnion to sell on the international blackmarket.

Beside the nuclear uncertainties cre-ated by the Soviet breakup, the mostimmediate and glaring proliferation chal-lenges of the post-cold-war era have beenposed by two rogue states. Iraq sought todevelop nuclear weapons secretly despitebeing a party to the NPT, which expresslyforbids such efforts. Only after the defeatof Iraq in the Persian Gulf war in 1991did the world learn how close Iraq hadbeen to becoming a nuclear power withthe capacity to destabilize the Middle Eastand threaten the peace of the world.

North Korea, also a party to the NPT,refused to permit required internationalinspections and is suspected of havingmade one or two nuclear devices. NorthKorea's conduct had greatly alarmedSouth Korea and Japan, which wereforced to reconsider their own nonnuclearstatus. It compelled the U.S. to threaten,cajole and reluctantly negotiate with thegovernment in Pyongyang (North Korea'scapital) in order to defuse the incendiarysituation in Northeast Asia.

At the upcoming NM' conference, theU.S. will press for indefinite extension ofthe treaty. But others, among them manynonnuclear countries, may withhold sup-

RONALD J. BEE is an author and educator.This article is excerpted from his forthcomingHeadline Series, "Nuclear Proliferation: ThePost-Cold-War Challenge."

.1 8GREAT DECISIONS 1995 15

talcum PROUNIADON

port unless the nuclear powers speedtheir progress toward the world nucleardisarmament they have pledged. In par-ticular, they may demand more rapidsteps toward a comprehensive ban onnuclear testing and a prohibition on themanufacture of materials such as pluto-nium and weapons-grade uranium.

Why were nuclear weapons ever de-vised? What motivates countries to build

and maintain nuclear arsenals? What isbeing done to prevent nuclear weaponryfrom becoming more accessible or evenfalling into the hands of irresponsibleleaders? What i. Washington's policy onthe subject? Can a cap really be put onnuclear proliferation? Or will the worldinevitably see dozens of countries bran-dishing weapons capable of the utmostdestruction?

Three nuclear racesWOLIFERATION HAS ITS ROOTS in threer nuclear races, one of which is still inprogress. Each of those stemmed frompolitical struggles that have marked the20th century and caused countrieseither through fear of their adversaries ora determination to dominateto covetthe deadliest weaponry that modern tech-nology could provide.

Race against the NazisEarly in World War II, German scientistsbegan work on a secret project, code-named The Uranium Society, to developan atomic bomb. Shortly after the Ger-man invasion of Poland in 1939, theevent that ignited the wider war, physi-cist Albert Einstein wrote to PresidentFranklin D. Roosevelt (1933-1945) alert-ing him to the German project and urgingsupport for U.S. atomic research. At thattime, the U.S. was not yet a belligerent,and the war seemed far from home. As aresult, Roosevelt committed only modestsupport for an advisory committee.

Not until after the Japanese attack onPearl Harbor, Hawaii, December 7, 1941,brought the U.S. into the war did Americabegin work in earnest on building a bomb.The atomic research operation was code-named The Manhattan Project and placedunder the direction of the U.S. Army inAugust 1942. As it turned out, when Ger-many surrendered in May 1945, its scien-tists had not come close to making anatomic weapon. On the other hand, theAmerican-led nuclear project had madegreat progress. On July 16, atAlamogordo, New Mexico, the U.S. con-ducted the first successful atomic test.

Germany's formidable ally, Japan,was yet to be defeated. The U.S. had suf-fered a great many casualties in the Pa-cific warfare, and President Harry S.Truman (1945-1953) may well havefeared that an invasion of Japan itself, at

a cost of a huge number of lives, wouldbe necessary to end the war. Some of thescientists who created the bomb arguedagainst dropping it on Japan. Others, likeIsidor Rabi, a Manhattan Project scien-tist, asked: "And what would PresidentTruman say to the American people af-terward? How could he explain to themthat he had had a weapon to stop the war,but had been afraid to use it, because itemployed principles of physics thathadn't been used in wartime before?"Truman made the decision to use the newweapons. In August, U.S. planes droppedatomic bombs on the Japanese cities ofHiroshima and Nagasaki, and the bloodi-est war in history came to an end.

The superpower raceAs Europe and Japan lay in ruins, a glo-bal political struggle, the cold war,between the U.S. and the Soviet Unionbegan to dominate the postwar era. TheSoviets conducted their first nuclear testin 1949.

The years that followed witnessedsome tense confrontations between theU.S. and the U.S.S.R. over the Sovieterection of the Berlin Wall in 1961 andthe Russian emplacement of nuclear mis-siles in Cuba in 1962, as well as wars in-volving U.S. and Soviet-backed forces inKorea and Vietnam. Actual hostilitiesbetween the two superpowers never tookplace, though each side, fearful and sus-picious, built growing numbers of in-creasingly powerful weapons.

On November 1, 1952, the U.S. testedthe first hydrogen bomb (H-bomb orthermonuclear bomb) on an island in thePacific Ocean. The bomb's mushroomcloud spread over 100 miles, and a 17-story building could have fitted in themile-long crater the blast left in the oceanfloor. The island all but disappeared. Thebomb's destructive power was measured

at 12 megatons, nearly 600 times that ofthe Hiroshima bomb. Unlike the atomicbomb, whose explosive energy comesfrom splitting the nuclei of atoms, or fis-sion, the hydrogen bomb derives itsenormous power from fusion, a processsimilar to what happens on the sun.

Not to be outdone by the Americans,the Soviets exploded their first hydrogenbomb on August 12, 1953. Both thencontinued to expand their arsenals andrefine their weapons, many of which car-ried multiple warheads. By 1967, theU.S. stockpile peaked at just over 32,000nuclear warheads; the Soviet stockpilenumbered 45,000 warheads by the mid-1980s. Why the need for so many? "Theweapons each side has sought," com-mented McGeorge Bundy, national secu-rity adviser (1961-1966) to PresidentsJohn F. Kennedy and Lyndon B.Johnson, "have been those its govern-ment found necessary in the light of whatothers had done or might do."

Observing the nuclear race between theU.S. and the Soviet Union, other countriesfound it "necessary" to acquire the mostmodern weapons available. Britain, fol-lowed by France and then China devel-oped atomic and hydrogen bombs duringthe 1950s and 1960s, each building arse-nals numbering hundreds of warheads. Inexplaining why France had to go nuclear,President Charles de Gaulle recalled hiscountry's humiliating defeat in WorldWar !land that "help came only after threelong years of struggle which nearly provedmortal for her." He also commented: "Nocountry without an atom bomb couldproperly consider itself independent."China's leader Mao Zedong offered asimilar reason. "If we are not to be bul-lied in the present-day world," he said,"we cannot do without the bomb."

Since China, no other country has be-come a declared member of the nuclearclub. Many regional wars have beenwaged. But the nuclear powers have notfought each other, and no nuclear weap-ons have been used in warfare since WorldWar II. Arguments have been made thatthe existence of nuclear weapons, thoughexpensive and potentially dangerous, hasactually served as a deterrent to war andkept the peace among the major powersfor some 50 years. Perhaps, say some pro-liferation experts, but couldn't a deterrentrole have been played with arsenals 100times smaller? Still others see no possiblesilver lining in the existence of nuclearweapons. They believe that major war was


1s

Declared Nuclear Weapon States

ri Newly Independent States WithNuclear Weapons on Territory:Belarus and Kazakhstan have acceded to the NPT asnon-nuclear weapon states; Ukraine has pledged to do so.All are transferring nuclear weapons to Russia.

Undeclared Nuclear Weapons States:These nations are believed to be able todeploy one or more nuclear weaponsrapidly or to have deployed them already.

0 Carnegie Endowment for International Peace

Active/Suspected Nuclear Weapons Programs:North Korea, Iran and Libya have taken steps in the past several yearsto acquire nuclear weapons capabilities. Algeria may also have done so.

Recent Renunciations:These nations were known or believed to have had active nuclear-weapon programsduring the 1980s, but recently renounced such activities by opening all of theirnuclear facilities to international inspection and/or by ceasing clandestine researchon nuclear arms. Iraq's program was dismantled by U.N. inspectors after Iraq's defeatin the Gulf War and is under special U.N. mandated long-term monitoring.

Abstaining Countries:These countries have the technological base, but not thus far the desire, to developnuclear weapons. A number have installations under international inspection that canproduce weapons-grade nuclear material.

The Spread of Nutlear-Weapons.1945 to the present .. .

averted in spite ofand not becau,..e ofthe nuclear arms race. They also ask aquestion that bothers many: What happensif these terrible weapons fall into thewrong hands?

Race against proliferationFrom the start of the nuclear age, it wasclear the new weaponry had to be broughtunder international control. In 1946, Presi-dent Truman offered to turn over the se-cret and control of the atomic bomb to theUnited Nations. Presented to the UN bythe financier and presidential adviser Ber-nard M. Baruch, then serving as U.S. rep-resentative to the UN Atomic EnergyCommission, the American proposalcalled for the establishment of a perma-nent UN agency to control, inspect andlicense all atomic reactors and materialsto ensure their use for peaceful purposes.The UN would have the authority to pun-ish violators. Known widely as the BaruchPlan, the American proposal provided forthe destruction of all U.S. atomic bombsafter international controls, includingstrict verification procedures, were agreedupon. "If we fail," said Baruch, "we have

damned every man to be the slave of fear."Whether this plan would have been

acceptable to the U.S. Congress is opento question. But it never came to that.The Soviets, then at work on their ownatomic bomb, denounced the proposal as"vicious and unacceptable." They wereparticularly averse to the verificationrequirements, insisting that they wouldnot have their country "invaded" by in-ternational inspectors. The UN commis-sion eventually adopted a plan similar tothe American proposal, but it wasblocked in the Security Council by aSoviet veto.

The U.S. tried a different tactic in1953, when President Dwight D.Eisenhower (1953-1961) delivered his"Atoms-for-Peace" speech to the UNGeneral Assembly. The Presidentstressed the use of nuclear energy to"serve the peaceful pursuits of mankind"and called for the establishment of an in-ternational atomic energy agency. SinceEisenhower saw no urgent need for "acompletely acceptable system of world-wide inspection and control," this timethe Soviets did not balk. After they and

BEST COPY AVAILABLE

the Americans came to an agreement inbehind-the-scenes negotiations in NewYork City, the UN was able to establishthe International Atomic Energy Agency(IAEA) in 1957. The goals of the agency,headquartered in Vienna, Austria, wereto encourage the use of atomic energy forpeaceful uses and prevent the misuse ofnuclear technology and fissile materialsfor armaments.

After the Cuban missile crisis of 1962had brought the U.S. and the Soviet Unionclose to outright war, the two shaken su-perpowers stepped up their efforts to bringnuclear weapons under control. The firstnuclear test-ban treaty, limited to tests inthe atmosphere, outer space and underwater, was signed in August 1963. Presi-dent Kennedy and Soviet Premier NikitaS. Khrushchev also started serious nego-tiations on a treaty to curb the spread ofnuclear weapons. After Kennedy's assas-sination, President Johnson continuedthose efforts, and in June 1968 a treatysubmitted jointly by the U.S. and theSoviet Union was approved by the UNGeneral Assembly. The pact entered intoforce on March 5,1970.

GREAT DECISIONS I 9 9 5 17

NUCLIAR INKIWIRATKom

Perils and prospectsRECENT YEARS HAVE BROUGHT some

encouraging news regarding nuclearproliferation. Iraq is being denuclearized.North Korea has recently tentativelycommitted itself to dismantle its weaponsprogram. After years of remaining aloof,France and China signed the NPT. Ar-gentina, Brazil and Chile resolved someobjections and acceded to the Treaty ofTlatelolco in early 1994. The Organiza-tion of African Unity (OAU) expects tohave a treaty providing for an Africannuclear weapons-free zone ready for sig-nature in 1995.

Still, neither these heartening develop-ments, nor the end of the cold war, northe preventive measures taken by the in-ternational community have eliminatedthe threat of nuclear proliferation. As Iraq,North Korea and other countries demon-strate, the appetite for the power and pres-tige that come with nuclear weapons re-mains strong. Policing has proven diffi-cult. If the nonproliferation regime (Seep. 20) falters, the world could see 20 ormore countries with nuclear arms.

After the Soviet fallThe disintegration of the Soviet Unioncreated two major proliferation threats: (1)some of the successor republics might tryto gain control of the weapons still on theirterritory and go nuclear on their own right;(2) Russia, as the sole recognized inheri-tor of control over Soviet nuclear arms,would export materials, technology andknow-how to the nonnuclear world.

In addition to Russia, the newly inde-pendent states of Belarus, Kazakhstanand Ukraine retained strategic and tacti-cal nuclear weapons on their territories.By late 1993, Belarus and Kazakhstanhad signed the NPT, but Ukraine, a coun-try of 52 million people and the world'sthird largest nuclear power, caused con-siderable concern, since clearly it was inno rush to accept the treaty.

In agreeing to the terms of the Lisbonprotocol to the Start I pact in 1992,Ukraine had promised to return all Sovietnuclear weapons on its territory to Russiaand to accede to the NPT in the "shortestpossible time." Since then, Ukraine hastransferred a sizable number of nuclearweapons to Russia, but nationalist politi-cal leaders urged the retention of some

warheads as a hedge against potentialRussian ambitions.

The Clinton Administration pressedUkraine to honor its agreement underStart I, and in January 1994, the Presi-dent met with Russian President Boris N.Yeltsin and then Ukrainian PresidentLeonid M. Kravchuk in Moscow to re-solve the problem. In a trilateral agree-ment, Ukraine reaffirmed its commitmentto a nonnuclear status. In return, the U.S.promised Ukraine at least $175 million infinancial assistance for the dismantlingand transport of weapons on its territory.Russia agreed to provide Ukraine withnuclear fuel assemblies to keep its powerplants operating in exchange for thehighly enriched uranium in the warheadsbeing returned to Russia.

Ukraine's parliament ratified Start Iunconditionally in February 1994. And inNovember, on the eve of a visit by thenewly elected Ukrainian president, Le-onid D. Kuchma, to the U.S., the parlia-ment voted overwhelmingly to ratify theNPT. One of the few conditions was thatRussia, the U.S. and Britain would re-spect Ukraine's borders and never usenuclear weapons against it. Parliament'sagreement cleared the way for Russia toimplement Start I and for the Russianparliament and the U.S. Congress toratify Start II.

A major unresolved problem, however,is the existence of huge amounts of So-viet nuclear material, technology and ex-pertise. Plagued by sluggish economiesand a need for hard currency, Russia andthe other successor-states have a strongincentive to sell these assets abroad. Inresponse to U.S. pressure, PresidentYeltsin has agreed to establish nuclear-export-control laws and guard against a

GLOSSARY

ATOMIC SONS (A-KOMIlb Bomb whose ex-plosive power comes from the fissionable nu-clei of the isotopes uranium -235 and pluto-nium-239. First U.S. bomb tested was madewith plutonium-239, and carried a force of 17kilotons of TNT..

FISNOtk The splitting of uranium or pluto-nium atomic nuclei into fragments, a processthat releases energy in the form of heat, blastand radiation. The process used in atomicbombs.

FUSION:. The compression of lightweightatomic nuclei into a nucleus of heavier mass,with the attendant release of energy. The pro-cess used in hydrogen bombs.HIGHLY INRKHID URANIUM: biznium inwhich the percentage of uranium-235 nucleihas been increased from the naturally occur-ring level of 0.7% to some greater level, usu-ally around 90%. Along with plutonium (seebelow), one of the two fuels essential for mak-ing nuclear weapons.

HYDROGIN BOMB (H-IONS OR IMMO-NUCLIAR ROMS): Bomb whose explosivepower derives from nuclear fusion (see above).The first one tested by the U.S. was nearly 600times more powerful than the atomic f!ombdropped on Hiroshima, Japan. Hydiogenbombs have never been used in W1111i111...'

NUCLEAR ran mire oft1987 bilateral treaty between the U.S. and theU.S.S.R. eliminating an entire class of nuclearweaponsintermediate-range ballistic mis-siles and shorter-range ballistic missiles.

PLUTONIUM: An isotope which is manufac-tured artificially when uranium-238, throughirradiation, captures an extra neutron. One of

the two core materials used in nuclear weap-ons, the other being highly enriched uranium(see above).SAFIGUARDSI System used by the Interna-tional Atomic Energy Agency (IAEA) to in-spect a nation's nuclear facilities that are de-clared as a result of the nation becoming partyto the Treaty on the Nonproliferation ofNuclear Weapons (NPT), or as a result of abilateral agreement. Inspections make use ofa mix of material accountancy, containmentand surveillance to provide evidence of unau-thorized use or transfer of safeguarded nuclearmaterials.

SPIN( PUIL: Nuclear fuel that has been usedin a reactor and removed because it containstoo little fissile material to sustain reactor op-eration. Extremely radioactive.111tAllI0IC ARMS IUMTATION TALKS (SALT) kSeries of talks from 1969 to 1972 in which theU.S. and the U.S.S.R. negotiated the firstagreements limiting some of their deadliestweapons.

1111tAlIGK ARMS UMITAllON TALKS (SALT) IliSecond round of talks, from 1972 to 1979,which ended in agreement by the U.S. and theU.S.S.R. to set equal aggregate ceilings andsubceilings on strategic-offensive-weaponssystems and impose restraints on existing andfuture strategic systems. The agreement wasnever ratified.

MATSON ARMS REDUCTION MEATY (START)I AND lk Signed by the U.S and the U.S.S.R.in July 1991, Start I provides for the reduc-tion of approximately one third of strategicwarheads of both parties, limiting nuclearwarheads to 6,000. Under Start II, the U.S. andRussia will reduce strategic warheads to be-tween 3,000 and 3,500 and eliminate land-hued missiles with multiple warheads.

IS GREAT DECISIONS 1995

21

NUCLEAR PROUPERATION

nuclear braindrain by creating researchprojects to employ former nuclear scien-tists and engineers. Yeltsin also pledgedto give Russian border guards better train-ing in the detection of nuclear smugglers,a growing problem. In one reported inci-dent, soldiers looking for drugs at a Rus-sian roadblock instead found nuclear-weapons components stolen from a Sovietnuclear laboratory. In Germany, fromMay to August 1994, four arrests of smug-glers carrying weapons-grade uraniumand plutonium allegedly stolen fromformer Soviet laboratories raised graveconcern about the existence of an inter-national black market for nuclear assets.

Threat from North KoreaBeing party to the NPT as a nonnuclear-weapons state does not guarantee a willto comply with its pledges, as the actionsof North Korea well illustrate. It signedthe NPT in 1985 but did not permitIAEA inspections until 1992. When in-spectors arrived, they found discrepan-cies in North Korea's declaration ofnuclear material; samples taken showedthat it produced more plutonium than ithad acknowledged. Moreover, inspectorswere prevented from conducting crucialtests to verify that no nuclear materialshad been diverted from seven declarednuclear sites.

Then in March 1993, after the IAEAhad asserted its right to inspect two unde-clared sites suspected of storing nuclear-waste products, North Korea threatenedto withdraw from the NPT. In June, afterthe UN Security Council urged it to per-mit inspections of the facilities in ques-tion, North Korea announced that itwould no longer allow inspections evenof its declared sites. By November,IAEA Director General Hans Blixwarned that his organization could nolonger ensure that North Korea's nuclearmaterials were being used solely forpeaceful purposes. U.S. intelligenceagencies estimated a better-than-evenpossibility that the country had enoughnuclear material to make one weapon.

In March 1994, after another round oftalks with the U.S., North Korea chose toreadmit inspectors to the seven declaredsites. But at one of them, they were notpermitted to take the samples needed toverify that plutonium had not been mis-handled. Once again, the IAEA foundNorth Korea in noncompliance.

As the possibility grew of UN sanc-tions, North Korea said that would be "an

act of war"; one diplomat threatened toturn the South Korean capital of Seoulinto a "sea of flames." Defiantly,Pyongyang unloaded fuel rods from itsprincipal reactor, a process that shouldhave been inspected by the IAEA to en-sure that no fuel diversion took place.The removed spent fuel, it was estimated,contained enough plutonium to make upto five nuclear weapons. By mid-June, asthe U.S. called for UN sanctions, a ner-vous South Korea called up its militaryreserves and Washington sent 48 Patriotmissiles to protect its ally against NorthKorean missile attack.

The threat of war abated, however,after former President Jimmy Carter, on a"private" visit to North Korea, gainedPresident Kim II Sung's agreement tofreeze temporarily his country's nuclear

IAEA

INf

LIST

NNPA

NPT

NSG

OAU

!NE

ABBREVIATIONS

International Atomic Energy Agency

Intermediate Nuclear Force Treaty

Limited Test Ban Treaty

Nuclear Non-Proliferation Act

Treaty on the Non-Proliferation ofNuclear Weapons

Nuclear Suppliers Group

Organization of African Unity

Peaceful Nuclear Explosions Treaty

program. As a result, Washington putsanctions on hold and agreed to meetagain with the North Koreans. Talks inGeneva, Switzerland, were interrupted inJuly when Kim Il Sung died. Theyresumed in August 1994, with his sonand successor, Kim Jong II.

The threat of a showdown with NorthKorea receded on October 18, when theU.S. announced the successful conclusionof the negotiations. In exchange for a com-mitment from the North Korean leader-ship to freeze and gradually dismantle itsnuclear-weapons program, PresidentClinton approved a plan calling for morethan $4 billion in energy aid to NorthKorea over the next decade. A consortiumof nations, led by South Korea and Japan,will provide for the construction of light-water nuclear reactors, designed to makethe conversion of nuclear waste intonuclear weapons far more difficult. Un-der the accord, North Korea must allowfull and continuous inspections of itsnuclear sites, freeze and then later disas-semble some of its key nuclear plants, and

then ship its spent nuclear fuel rods out ofthe country. Critics of the plan contendthat North Korea can keep the fuel rodsfor years, surrendering them only whenthe new plants are near completion. Basedon past experience, they say, North Ko-reans could also renege on the agree-mentas they have beforeand rejectIAEA inspections.

The accord reduced tensions causedby North Korea's nuclear program, but italso led some to ask: Will it preventNorth Korea, despite inspections, frommaking nuclear weapons? Does theagreement strengthen or und5:rmine thevalue of the NPT and the IAEA' s safe-guards system?

Middle East challengesIf North Korea has been the center ofnuclear concern in Northeast Asia, threecountries are major players on the com-plex proliferation scene in the MiddleEast: Iraq, Iran and Israel.

Iraq Another NPT party with nuclearambitions, Iraq has been a painful embar-rassment (and lesson) for the IAEA. De-spite safeguards, the Iraqi nuclear-weap-ons programstimulated by fear ofIsrael's possession of the bomb, thethreat of renewed warfare with Iran and adesire for regional dominancesecretlycame close to success before defeat in thePersian Gulf war led to its exposure.

Postwar inspections by IAEA teamsrevealed that Iraq had managed to con-ceal a large, complex project costing bil-lions of dollars and involving thousandsof skilled technicians. Using oil revenues,Iraqi President Saddam Hussein had re-lied on an extensive international networkto buy equipment and materials his coun-try could not make or purchase throughlegitimate means. He had hoped to makesome weapons-grade uranium by late1993 and eventually produce enough tobuild several nuclear weapons a year.

After Iraq's defeat, the UN SecurityCouncil authorized the IAEA to inspectsites anywhere in the country and destroyfacilities and equipment that could beused to make nuclear or other weapons ofmass destruction. Despite initial lack ofcooperation and occasional harassmentby the Iraqi authorities, by 1994 the UNseemed certain that Iraq's nuclear capac-ity had been destroyed. But UN inspec-tors cautioned that a monitoring systemthat they had installed would needlengthy testing to guard against Iraqi at-tempts to revive their weapons program.

GREAT I993 19

NUCLIJt PROUFERA11ON

The Nonproliferation RegimeTHE NONPROLIFERATION TREATY is the centerpiece of effortsin the race against the spread of nuclear weapons. TheNPT, along with the IAEA, several other treaties, agree-

ments and national policies, combine to make up what hascome to be known as the nonproliferation regime.

The Treaty on the Non-Proliferation of Nuclear Weap-ons: The NPT is the most widely adhered-to arms-controlagreement in history. It has sought to freeze the number ofnuclear-weapons states at five, and as of 1992, when France andChina signed on, all five countries that have declared they pos-sess nuclear weapons have become parties to it.

Since 1970, parties to the NPT have held four review confer-ences, one every five years, as required by the treaty. At thefifth and most important, in April 1995, the parties will "decidewhether the treaty shall continue in force indefinitely."

si International Atomic Energy Agency: Though affiliatedwith the UN, the IAEA is largely autonomous. The agency hastwo chief roles: (1) to facilitate the transfer of peaceful nucleartechnology to developing countries; and (2) to verify compli-ance with the NPT.

The NPT requires all nonnuclear-weapons countries to nego-tiate IAEA "safeguards" agreements, which spell out inspectionprocedures. The U.S., Britain and the U.S.S.R. in separateagreements voluntarily opened all their civilian nuclear reactorsto inspections; France and China opened some. All the weaponsstates, however, exclude military-related facilities from suchinspection.

Not all members of the IAEA are parties to the NPT. Thus,India and Pakistan, which are not parties to the NPT, allow theIAEA to inspect some, but not all, of their nuclear facilities.Argentina and Brazil, also non-NPT countries, neverthelesspermit full-scope IAEA safeguards on all their nuclear activities.

When the extent of the Iraqi nuclear program became publicknowledge after the Persian Gulf war, the agency's safeguardssystem came in for heavy criticism. As a result, some of theprocedures have been improved and other changes are underreview. Member states now must facilitate inspection proce-dures by providing design information about nuclear facilitiesbefore nuclear material is introduced. In the case of Iraq, largequantities of natural uranium and uranium oxide (sometimescalled yellow-cake) were not under IAEA safeguards and wereeasily diverted for use in its weapons program. Consequently, ithas been suggested that countries be required to place a widerrange of equipment, facilities and materials under safeguards. Inaddition, the IAEA has proposed the establishment of an inter-national register for all nuclear transfers, including dual-usetechnologies that can be used for civilian or military purposes.

Critics contend that the IAEA must be more aggressive ininspecting "undeclared" nuclear sites and in conducting special,unannounced "challenge inspections." Also, shorter notice ofinspections should be given to reduce the likelihood of stateshiding their nuclear activities.

Despite the IAEA's expanded responsibilities, including thedenuclearization of Iraq, inspections of Brazilian, Argentineand South African nuclear facilities, and coping with nuclear

20 OREAT DECISIONS 1995

environmental hazards in Eastern Europe and the former SovietUnion, its budget has been frozen for eight years.

Other elements of the regime: Two treaties complementthe NPT in combating the spread of nuclear weapons to othercountries. The Treaty of Tlatelolco (1967), which calls for theestablishment of a nuclear-weapons-free zone covering Centraland South America, has been ratified by all Latin Americancountries, with the exception of Cuba. It requires parties to ac-cept full-scope IAEA safeguards and prohibits nuclear-weaponsstates from using or threatening to use nuclear weapons in thearea. The Treaty of Rarotonga (1986) prohibits the manufactureor acquisition of nuclear weapons by states in the South Pacificregion and bans the stationing of nuclear weapons there bynuclear-weapons states. Neither France nor the U.S. has signedthis treaty; the chief U.S. reason is that it. ould set a bad prece-dent for other regions where an American nuclear deterrentmay still be needed.

A number of other treaties contribute to halting the growthof existing nuclear stockpiles. These include the Limited TestBan Treaty (LTBT) of 1963, the Strategic Arms LimitationTalks (SALT I) agreement of 1972, the Peaceful Nuclear Ex-plosions Treaty (PNE) of 1976, the Intermediate Nuclear ForceTreaty (INF) of 1987, and the two Strategic Arms ReductionTreaties (Start I and II) of 1991 and 1993.

sa Committees and other groups: To help NPT members de-termine which exports to nonweapons states needed safeguards,a committee was formed in the early 1970s to keep a "triggerlist" of materials and equipment "especially designed or pre-pared" for nuclear use, including reactors, reactor componentsand certain materials such as heavy water that could be used formilitary purposes.

After India's nuclear test in 1974, it was clear that more-restrictive export guidelines were required. At the suggestion ofthe U.S., a suppliers' group was formed. It called for restraint inexporting dual-use items such as technology for the enrichmentand reprocessing of nuclear materials, a prohibition againstpassing exports on to third parties, and a '..equirement that im-porting states accept full-scope IAEA safeguards.

In March 1991, after the revelation of Iraq's procurementactivities, the Nuclear Suppliers Group (NSG) met and updatedits list of controlled items. It agreed upon stricter guidelines forthe export of a wider range of dual-use nuclear-related materi-als and technologies and to report such exports to the IAEA.

American legislation: In 1978, the U.S. Congress passedthe Nuclear Non-Proliferation Act (NNPA) committing theU.S. to support the NPT and a stronger, more effective IAEA.In an action then seen as controversial, the NNPA required"full-scope safeguards" on all nuclear activities (not just thosedeclared) in nonnuclear states as a prerequisite for exportingAmerican nuclear technology. This provis'on is now acceptedby many countries as a standard for nuclear exports.

After the breakup of the Soviet Union in 1991, Congresspassed legislation known as the Nunn-Lugar Act. to help ensurethat Soviet nuclear weapons were dismantled and destroyed andto establish safeguards against the proliferation of such weap-ons. Expenditure of the authorized funds has been slow becauseof difficulties in negotiating the necessary implementing agree-ments with Russia, Belarus, Ukraine and Kazakhstan.

NUM MI PROWIRATION

The Iraqi case was a wake-up call forthe IAEA as well as the rest of the entirenonproliferation regime. All involvedhad been ineffective in dealing with anNPT party that was engaged in an exten-sive clandestine program to build nuclearweapons. The IAEA is considering pro-posals to strengthen safeguards, but aquestion remains: Barring a level of in-trusion into domestic national affairs thatis not acceptable to most countries, canthe international community ever be to-tally certain that a country is not secretlybuilding a nuclear arsenal?

Iran The question is particularly per-tinent when considering Iran, anotherparty to the NPT. To date, the IAEA hasreported no unexplained discrepancies inIran's nuclear materials or the existenceof nuclear-weapons facilities. Butgrounds for suspicion are ample. Inrecent years, President HojatoislamHashemi Rafsanjani has openly called forthe development of nuclear weapons, andat least one Iranian official has declaredthat Muslim states need nuclear weaponsto balance Israel's undeclared arsenal.

In 1991, Iran unsuccessfully tried topurchase a 30-megawatt nuclear researchreactor from India that could haveproduced enough plutonium to makeseveral weapons annually. The followingyear, Iran sought to buy nuclear-reprocessing equipment from Argentina,but the sale was blocked by Americanpressure. Russia and China both havepromised to supply reactors to Iran. TheU.S. opposes the sales, and as of late1994 no deals had been transacted.

Though an "Iranian smoking gun" hasnot been found, some U.S. experts thinkit likely that Iran might be getting nuclearassistance from China and North Korea,its major arms suppliers during the warwith Iraq. Unconfirmed reports alsoclaim that Iran has been recruiting Rus-sian nuclear scientists. While Iran assertsthat its nuclear activities remain peaceful,the U.S. believes otherwise. In February1993, R. James,Voolsey, director of theCentral Intelligence Agency (CIA), toldthe Senate Government Affairs Commit-tee that "Iran probably will take at leasteight to ten years to produce its ownnuclear weapons, perhaps sooner if it re-ceives critical foreign assistance."

Israel: 'ambiguous' arsenalIsrael began its nuclear-weapons pro-gram in the mid-1950s, with cooperationfrom France. Following the Suez crisis of

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1956, France and Israel both felt threat-ened by Arab nationalism, leadingFrance secretly to supply Israel with aplutonium-production reactor (locatednear Dimona in the Negev desert), weap-ons design and weapons-manufacture in-formation. By 1974, the American CIAreported, "We believe that Israel has al-ready produced nuclear weapons." In1986, The Sunday Times of London pub-lished extensive interviews withMordechai Vanunu. a technician whohad worked at Dimona for almost 10years. Vanunu reported that Israel hadproduced enough plutonium to produce"at least 100 and as many as 200 nuclearweapons of varying destructive power."McGeorge Bundy, in his book, Dangerand Survival: Choices about the Bomb inthe First Fifty Years, concluded thatVanunu's testimony "showed that the Is-raeli program fully justified the designa-tion of Israel as the sixth nuclear power."

Israel, however has maintained apolicy of strict secrecy regarding itsnuclear-weapons program. It does notadmit to having nuclear weapons at all,although Israeli officials tacitly admit tohaving the capacity to deploy them as alast resort. It has formally maintainedsince 1962 that "there are no nuclearweapons in the Middle East and Israel willnever be the first to introduce them." This"ambiguity" between the evidence and theIsraeli "no bombs" posture is intended todeter enemies in the Middle East frommounting a military attack that mightthreaten Israel's existence. The U.S. gov-

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ernment has accepted this Israeli ambigu-ity, but in doing so has raised the issue ofAmerica playing favorites in its efforts tolimit the spread of nuclear weapons.Moreover, in the case of Iraq, and possi-bly Iran, Israel's undeclared nuclear ar-senal has been one of the reasons for ra-tionalizing clandestine nuclear-weaponsprograms. Israel has not signed the NFL

South Asian rivalsIndia and Pakistan have gone to war witheach other three times since indepen-dence in 1947. American intelligence ex-perts believe both countries, neither ofwhich has signed the NPT, have all thecomponents necessary to make nuclearweapons, within hours if necessary.Moreover, the next stage in this regionalarms race has already begun; both Indiaand Pakistan are seeking ballistic mis-siles that could carry nuclear warheads.

India's motive for developing nuclearweapons stemmed from concerns in the1960s over the nuclear threat from thePeople's Republic of China, a desire forregional power and world influence, and,since the mid-1980s, a perceived need tokeep ahead of Pakistan's nuclearprogram. In 1974, India tested a "peace-ful nuclear device," and in the 1980s itenlarged its capacity to make nuclearweapons by building new reactors andplutonium-extraction plants.

Since its loss in the 1971 war withIndia and the Indian nuclear test in 1974,Pakistan has launched its own nuclear-weapons program. During the 1980s,

GREAT DECISIONS 199 s 21

NUCLIAR PROUFMATION

Pakistan received considerable nuclearassistance from China and developed thecapacity to build its own weapons.

Neither India nor Pakistan at presentchooses to build actual nuclear weapons.Both could make them at a moment'snotice, a situation that has been called"nonweaponized deterrence." In short,India and Pakistan deter each other withthe prospect of nuclear weapons.

The U.S. and other countries con-cerned about proliferation fear that thisform of deterrence could easily fail, sincetension between the two countriespar-ticularly in the Kashmir regionremainsat a consistently high level. CIA directorWoolsey warned in 1993 that South Asia"poses perhaps the most probable pros-pect for future use of weapons of massdestruction, including nuclear weapons."

Reviewing the treatyThe danger posed by a nuclear-armedSouth Asia will be on the minds of thedelegates to the NPT extension confer-ence. The U.S. and most other major in-dustrialized countries support an indefi-

nite extension, but many nonnuclear par-ties to the treaty have reservations. Tobegin with, the nonweapons states wantthe five declared weapons states to makeswifter progress toward the cessation ofthe arms race and toward universalnuclear disarmament. Some would like tosee an unconditional pledge by the weap-ons states never to use nuclear weapons.Others may well press for a worldwideban on the production of fissile materials,weapons-grade uranium and plutonium.Many especially want to see swifterprogress by the weapons states toward acomprehensive ban on nuclear testing.

Currently, the U.S., Russia, Britainand France are abiding by a voluntarymoratorium on all testing. China wishesto continue with an ongoing series oftests until its scheduled conclusion in1996. The nuclear have-nots may insiston a firm commitment to halt tests beforethey agree to an indefinite extension. Ifthe treaty is extended for a fixed periodinstead, it would have to be amended af-ter that period, requiring ratification byall parties to the treaty.

A new U.S.EXPERTS ON NUCLEAR policy differ onmany issues, but on two things there

is consensus: (1) the next decade will becrucial in the fight to contain the spreadof nuclear weapons; and (2) the role ofthe U.S. will be decisive in the outcome.

The Clinton Administration seemswell aware of the high stakes involved.On September 27, 1993, after an eight-month interagency review, PresidentClinton signed Presidential DecisionDirective 13 (PDD-13)confidentialguidelines for his Administration's policyon nuclear proliferation. On the same day,in a speech before the UN in New YorkCity, he included a proposal for a newtreaty that would prohibit the productionof fissionable uranium or plutonium fornuclear weapons.

While the PDD-13 remains classified,the general thrust of the current U.S.policy is clear.

1. Strengthen the existing regime. Inaddition to the proposed treaty to banproduction of fissile materials, the Ad-ministration says it will seek ways toeliminate existing stockpiles of such ma-terial. To this end, the U.S. agreed to pur-chase 500 tons of highly enriched Rus-

'Icysian uranium removed from warheads; itwill also permit IAEA inspection ofAmerican fissile material no longerneeded for weapons. In addition, the U.S.will make a strong effort to secure theindefinite extension of the NPT treaty,and it will press for the earliest possibleconclusion of a comprehensive ban onnuclear testing. It will seek more "re-sources" [funds] for the IAEA, tostrengthen its "ability to detect clandes-tine nuclear activities."

2. Pay close attention to proliferationhot spots. In addition to keeping a sharpeye on the dismantling of North Korea'snuclear-weapons program and the lastingdenuclearization of Iraq, the U.S. will tryto contain Iran's nuclear ambitions andencourage India and Pakistan to cap andeventually roll back their nuclear andmissile capabilities. By promotingdialogue and a sense of confidencebetween Israel and the Arab states, theAdministration hopes eventually to"create the basis for a Middle East free ofweapons of mass destruction." It alsowill intensify efforts to prevent the statesof the former Soviet Union, EasternEurope and China from exporting nuclear


material, technology and know-how.3. Balance export controls with eco-

nomic interest. The goal here is to reviewU.S. export controls relating to nuclearproliferation on a case-by-case basis,eliminating those that inhibit exports un-less they are deemed necessary for secu-rity or foreign policy reasons. Critics fearan easing of controls will aid countrieswith nuclear ambitions, but the Adminis-tration argues that American dual-useexport controls, more stringent than thoseof other countries, hurt U.S. exportersand should be reassessed.

4. Consider "counterproliferation."This relatively new concept is designedprimarily to thwart terrorist groups orrogue nations, and to give the President arange of military options in case nonpro-liferation efforts fail. Counterprolifera-tion includes a variety of governmentalactivities from diplomacy, arms controland export controls to heightened intelli-gence gathering and possible preemptivestrikes. One relevant military option isthe new theater missile defense system,that would include a mobile antimissileinterceptor for use against short- andmedium-range missiles.

Proponents see counterproliferationplanning as prudent, given the changingnature of threats to U.S. security. Criticssee counterproliferation as an overreac-tion, designed to bolster the role of thedefense and intelligence communitiesand to justify the development of expen-sive new weapons. They fear that pre-emptive strikes, if used without interna-tional sanction, would have harmful po-litical and diplomatic consequences.They also doubt they could be effective,especially against targets hidden or dis-persed across a wide terrain.

As the Clinton Administration shapesits policy on nuclear weapons, expertsand pundits of many political shadeshave contributed their thoughts. One po-sition might be called step back and closethe nuclear umbrella. In expounding thisview, Ted Galen Carpenter, Director ofForeign Policy Studies at the Cato Insti-tute, a conservative research organizationin Washington, D.C., contends that "thefirst task of a prudent U.S. security strat-egy must be to keep America out of thenuclear crossfire." He doubts that theNPT and the "unraveling nonprolifera-tion system" that it represents, can stopthe spread of nuclear arms. In the post-cold-war era, Carpenter writes, the U.S.should be wary of "entangling nuclear

alliances" that could involve the countryin regional nuclear wars. The U.S., hefears, could be called upon to deternuclear states from attacking or intimi-dating regional American allies. Nowthat the global struggle against the SovietUnion is over, the U.S. nuclear umbrella,once extended protectively over manynonnuclear countries, should be closed.

A quite different perspective, held bystrong supporters of multilateralism,would not abandon nonproliferation ef-forts but let the UN take the lead. Thoughthe U.S. is now the world's sole super-power, they say, it neither can nor shouldbe the nuclear policeman. It should joinother nations in supporting multilateralorganizations, agreements and initiativesconcerned with proliferation, but itshould defer to the leadership of such fo-rums as the UN Security Council, theIAEA and the UN Conference on Disar-mament. Moreover, the U.S. should sup-port the establishment of a UN "rapiddeployment force," to enforce UN Secu-rity Council resolutions as well asnuclear nonproliferation commitmentsunder the NPT.

A third suggested strategy calls for theU.S. neither to withdraw nor defer, but tocontinue America's global leadershiprole in curbing the spread of nuclearweapons. The Atlantic Council of theUnited States, a nonprofit organization inWashington, D.C., for example, encour-ages U.S. support for multilateral efforts,but it believes that no other country orgroup of countries can offer a compa-rable leadership role. "Successful con-struction of a stable and predictableworld order in changing political condi-tions," it argues, "still depends very fun-damentally on the political will of theU.S."

Many other voices are being heard.Jonathan Dean, arms-control adviser tothe Union of Concerned Scientists, aMassachusetts-based advocacy group onnuclear issues, thinks the nuclear powers,especially the U.S., should be paying lessattention to ending warhead testing andthe production of fissile materials andmore to reducing their own vast stock-piles of warheads and missiles. He advo-cates an irreversible "builddown" anddestruction of nuclear arsenals under bi-lateral or multilateral monitoring.

In their book, Reducing Nuclear Dan-ger: The Road Away from the Brink.McGeorge Bundy, William J. Crowe Jr.(former chairman of the Joint Chiefs of

Staff), and Sidney D. Drell (physicist andprofessor at Stanford University) also ar-gue that the existing arsenals of nuclearweapons should be reduced drastically.They call for more openness from theundeclared nuclear states of Israel, Paki-stan and India. "It is time," they say, "toreplace the inherited distinction betweenthose countries with nuclear weapons andthose without by a wider assertion that allnations should be on the same sideagainst nuclear dangerwhatever theirpresent degree of reliance on nuclearweapons." For all the disarmament andnonproliferation efforts, these authorsmaintain, "it is not at all clear that theoverall level of nuclear danger has gonedown."

Many experts and many political lead-ers, including President Clinton, wouldprobably agree with that glum judgment.The President and his policymakersunderstand that the U.S. has a decisiverole to play in curbing the spread of theweapon that was born at Alamogordo 50years ago.

But how well is that role actually be-ing played? Is the U.S. doing enough tohalt further nuclear proliferation? Is itpossible? If the experts are right, theyears immediately ahead should providethe answers.

U.S. policy options1. As the only country to have used

nuclear weapons in warfare, the U.S.has a moral responsibility to lead theresistance to proliferation.

Pro: From the start of the nuclear age,America has seen itself as duty-bound to

P.

combat the spread of nuclear weapons. Ithas led that fight; it should continue tolead, and with more vigor.

Con: America's use of the bomb in ajust cause 50 years ago has nothing to dowith it. Other countries, and the UN,should be taking more of a leadershiprole on this issue.J 2. The U.S. should make it clear toany country trying to acquire nuclearweapons that it will use preemptiveforce to prevent it.

Pro: The spread of nuclear weaponsmust be stopped. No country but the U.S.has the power and the political will to act.The U.S. should use force, with or with-out UN approval.

Con: The U.S. is not the world'snuclear policeman. The UN should im-pose tough economic sanctions againstsuch countries. As a last resort, the UNmight have to authorize the use of limitedforce.J 3. To discourage further prolifera-tion in the Middle East, the U.S.should try to pressure Israel into sign-ing the NPT and accepting IAEAmonitoring of its nuclear stockpile andfacilities.

Pro: Some Arab states feel they musthave nuclear weapons to balance Israel'sarsenal. That view might change ifIsrael's nuclear stockpile and facilitieswere placed under international control.

Con: Barring a comprehensive andwell-tested peace in the Middle East,Israel would be foolish to give up an im-portant military advantage. Such U.S.pressure would be resented; U.S. ties witha longtime ally would be jeopardized. r

or GREAT DECISIONS 1995 23

NUCLEAR PROLIFERATIONAt'

1. What priority should the U.S. give tonuclear nonproliferation? Should theU.S. support the indefinite extension ofthe NPT? Why or why not?

2. North Korea has agreed to freeze itsnuclear program in exchange for billionsin energy aid. What precedent does thisaccord set for other countries withnuclear ambitions? Does it help or hurtthe nonproliferation regime?

3. It has been argued that the existenceof nuclear weapons has served as a deter-rent to war. Others argue that war wasaverted in spite of nuclear weapons.What do you think?

4. All five declared nuclear weapons-states have signed the NPT, whichobligates them to pursue universaldisarmament. What additional stepsshould the U.S. take to abolish nuclearweapons?

5. How can the IAEA strengthen itssafeguards system? What steps shouldthe agencyand the U.S.take to en-force compliance? Negotiate? Apply eco-

nomic pressure? Take military action?

6. How serious a security threat doesRussia now pose to the U.S.? What canRussia and the international communitydo to s. op the illegal flow of nuclear tech-nology and materials to nonweapons-state5?

7. In November, Republicans were over-whelmingly voted into office. GOP lead-ers have pledged they will increase defensespending and cut international aid. Whateffect will this have on nations harboringnuclear ambitions? On the denuclear-ization of the former Soviet Union? Onnonproliferation efforts overall?

A LID0

Bailey, Kathleen C., Strengthening Nuclear Non-Prolifera-tion. Boulder, Colo., Westview Press, 1993. 132 pp. $15.95.Former Reagan official assesses current U.S. policy options forstrengthening the nuclear nonproliferation regime.

Bethe, Hans A., Gottfried, Kurt. and McNamara, Robert S.,"The Nuclear Threat: A Proposal." The New York Review ofBooks, June 27, 1991, p. 38+. The authors recommend reduc-ing U.S. and Russian nuclear forces to less than 5% of theircurrent level.

Bundy, McGeorge, Crowe, Jr., William J., and Drell, SidneyD., Reducing Nuclear Danger: The Road Away from theBrink. New York, Council on Foreign Relations, 1993. 107 pp.$12.95 (paper). Three nuclear experts offer their prescriptionfor preventing nuclear proliferation and advocate drasticallyreducing U.S. and Russian arsenals.

Carpenter, Ted Galen, "Life After Proliferation: Closing theNuclear Umbrella." Foreign Affairs, March/April 1994. Thedirector of foreign policy studies at the Cato Institute, argues thatthe U.S. must withdraw from "entangling nuclear alliances."

Clinton. Bill, "Address by the President to the 48th Session ofthe United Nations General Assembly." U.S. Department ofState Dispatch, September 27, 1993, pp. 649-53. A key speechthat outlines the Clinton Administration's approach to nuclearproliferation.

Dean, Jonathan. The Final Stage of Nuclear Arms Control."Washington Quarterly, Autumn 1994, pp. 31-52. Formerarms control negotiator advocates a builddown of nucleararsenals.

Mack, Andrew, "North Korea and the Bomb." Foreign Policy,Summer 1991. Why North Korea wants a nuclear capabilityand the problems this poses for the nonproliferation regime.

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GREAT DECISIONS 1995

Solarz, Stephen J., ' Next of Kim: How to Stop the North Ko-rean Bomb." The New Republic, August 8, 1994, pp. 23-27.The author calls for a hardheaded analysis that takes into ac-count North Korea's continuing nuclear capabilities and notmerely its political landscape.

Spector, Leonard, Nuclear Ambitions: The Spread ofNuclear Weapons. Boulder, Colo., Westview Press, 1990. 400pp. $54.00. Regarded by many as a classic work on nuclearproliferation.

ARMS CONTROL ASSOCIATION (ACA), 1726 M St., N.W., Suite201, Washington, D.C. 20036; (202) 463-8270. EA nonpartisannational membership organization dedicated to promoting pub-lic understanding of arms-control policies and programs.ACA's services include educational programs and a monthlyjournal, Arms Control Today.

COMMITTEE FOR NATIONAL SECURITY (CNS), 1601 ConnecticutAve., N.W., Suite 600, Washington, D.C. 20009; (202) 745-2450. r Nonprofit, nonpartisan organization that seeks to edu-cate the public on arms-reduction issues. In addition to organiz-ing workshops and seminars, CNS offers curriculum materials,books and reports.

INTERNATIONAL SECURITY COUNCIL (ISC), 2000 L St., N.W., Suite506, Washington, D.C. 20036; (202) 828-0802. A nonprofit,nonpartisan public-policy institution devoted to the critical ex-amination of international security issues. ISC conducts forumsand conferences and publishes books, reports, studies and thequarterly Global Affairs.

U.S. ARMS CONTROL AND DISARMAMENT AGENCY, State Depart-ment Building, 320 21st St., N.W., Washington, D.C. 20451;(202) 647-8677. I" Government agency that formulates andimplements arms control and disarmament policies.

WISCONSIN PROJECT ON NUCLEAR ARMS CONTROL, 1701 K St.,N.W., Suite 805, Washington, D.C. 20006; (202) 223-8299."'Carries out research and public education designed to inhibitthe spread of nuclear arms. Publishes Directory of CurrentProjects in the Field of Nuclear Nonproliferation.

2

Russia andits neighbors:U.S. policy choicesAs Russia seeks to come to terms with the collapse of anempire, the U.S. response will influence the stability ofcountriesin Russia's 'near abroad' and beyond.

by Allen Lynch

MIKHAIL S. GORBACHEV, presidentof a nuclear superpower of 288million people, voluntarily sur-

rendered the Soviet Union's political andmilitary control over the heart of Europein 1989-90. It was perhaps the most as-tounding political event of a centuryscarred by two world wars and the fall ofhalf a dozen overseas empires. Then,within barely two years, the Soviet Unionitself dissolved peacefully. A continentalRussian Empire that had been built upover more than three centuries ceased toexist.

Such a smooth surrender of interna-tional and sovereign power is unprec-edented. History teaches that the breakupof empires is usually associated withmajor wars. After World War I, forexample, the multinational Austro-Hungarian and Ottoman empires brokeup. The Russian Empire itself collapsedduring that war. Perpetual instability inthe Middle East followed the disintegra-tion of the Ottoman Empire. And thelongest, most destructive war in Europesince 1945 is being fought by descen-dants of the Austro-Hungarian and Otto-man empires in the former Yugoslavia.

The political, economic and diplo-matic consequences of the Sovietbreakup for the 15 successor-states arealso without historical comparison. Awhole series of new domestic and inter-national institutions, from local govern-ment to laws to alliances, must be con-structed on a vast scale. The internationalpolitics of Europe and Asia, not to men-tion critical U.S. foreign policy choices,-- ---------------------- -

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THE LAST SOVIET LEADER (1985-91), MikhailS. Gorbachev, addresses 28th party congressbeneath Lenin's statue in the Kremlin.Gorbachev's unprecedented reforms led tothe demise of the Communist party's monopolyof power in the U.S.S.R. and Eastern Europe.He won the Nobel Peace Price in 1990 forpromoting greater openness at home andhelping end the cold war.

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will be affected for the foreseeable futureby the collapse of Soviet power.

What will be the basis of internationalstability in central Eurasia? Will the Rus-sian Federation (or Russia, for short) beable to assert its influence on its neigh-bors by mutually acceptable economic,diplomatic and security arrangements?Or will Russia revert to a pattern of inter-vention and domination by force? Whatis the U.S. prepared to do to encouragethe first choice and discourage the sec-ond? Should the U.S. try to integrateRussia into the Western community ofnations by encouraging democracy and amarket economy and buttressing it as aregional policeman? Or should the U.S.try to curb Russia's expansionist tenden-cies by incorporating parts of EasternEurope, including possibly Ukraine, intoa Western-oriented security community,such as the North Atlantic Treaty Organi-zation (NATO)?

One question that U.S. analysts havenot yet faced is whether the Russian statecan survive if it tries to reestablish anempire. Alexei G. Arbatov, director ofthe Center for Geopolitical and MilitaryForecasts in Moscow, Russia's capital,has argued that because of the weaknessof the Russian state itself, "theattempt...to reconquer the former Sovietgeopolitical space would only lead to thefinal Russian national disaster, with cata-strophic consequences for the wholeworld." To what extent, then, are the U.S.and its allies prepared to work togetherwith Russia and its former Soviet neigh-bors to stabilize the new international or-der and avoid such an outcome?

Politics without governmentOne of the few who foresaw how the So-viet Union might come to an end and theconsequences for Russia is George F.Kennan, one of this country's preeminentstudents of Russian and Soviet affairs.Writing in 1947 in Foreign Affairs,Kennan wondered whether Stalin's suc-cessors might one day "reach down into[the] politically immature and inexperi-enced masses in order to find support fortheir respective claims...." If so, then"strange consequences could flow for theCommunist party: for the membership atlarge has been exercised only in the prac-tices of iron discipline and obedience and

ALLEN LYNCH is associate professor ofgovernment and director of the Center forRussian and East European Studies at theUniversity of Virginia.


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MAIM AND ITS NISOHIORS

not in the arts of compromise and accom-modation. And if disunity were ever toseize and paralyze the party, the chaosand weakness of Russian society wouldbe revealed in forms beyonddescription....& iet power is only acrust concealing an amorphous mass ofhuman beings among whom no indepen-dent organizational structure is tolerated.In Russia there is not even such a thingas local government. The present genera-tion of Russians have never knownspontaneity of collective action. If,consequently, anything were ever to oc-cur to disrupt the unity and efficacy ofthe party as a political instrument, SovietRussia might be changed overnight fromone of the strongest to one of the weakest

and most pitiable of national societies."If anything, Kennan's prophetic

words understated the condition of aRussia shorn of the Communist party.Not only does such a Russia find its inter-national influence vastly reduced butRussians face the troubling question ofnational identity. Russia, unlike theWestern powers, had incorporated its co-lonial conquests into the Russian state.What then is Russia without its empire?What is the national interest of a Russiathat isn't sure whether it is a nation or anempire? What about the 25 million Rus-sians who live outside Russia's newboundaries? These questions are amongthe most important issues of Russian do-mestic and foreign policy today.

Post-Soviet Russia'sinternational role

N THE SPRING of 1989, before theVI breakup, the effective boundaries of

the Soviet Russian state extended to theElbe River, in the heart of Germany. Be-fore 1991 was out, less taan three yearslater, these borders had been reduced bya greater extent than the loss of territoryinflicted upon the Soviet Union by theNazi armies in the summer of 1941. OfRussia's major boundaries, only that inSiberia has not changed. in the south, inthe Caucasus, Russia's formal bordersare those of roughly 1800, before the in-corporation of the Kingdom of Georgiainto the Russian Empire. In Central Asia,Russia's borders are those before thegreat imperial expansion begun in themiddle of the 19th century. Finally andmost importantly for Ru..,ia's standing asa European and a great power, in theWest, Russia's borders are those of morethan three centuries past, before the treatyof union with Ukraine.

No strict comparison can be madewith the American experience. But to ap-preciate the importance of Ukraine toRussia, it is as if overnight the U.S. hadbeen deprived of territories acquired dur-ing the Mexican War and the settlementof the Oregon territories in the mid-1800s. While such a loss would stillleave the U.S. a formidable country, itwould strip it of essential parts of its na-tional patrimony and leave many Ameri-cans with a burning sense of national hu-


miliation. France after World War II lostits empire and international influence.That blow to-French pride helped precipi-tate a drive led by General Charles deGaulle to make France once more a ma-jor world power. A comparable reactionin post-Communist, post-imperial Russiashould not be surprising.

Russia has not only been expelledfrom Eastern Europe, but its imperiallegacy has collapsed. In contrast withmost Western empire builders, Russia

incorporated its colonies directly into themother country. Since state and empirewere virtually one and the same, a threatto any part of the empire was also athreat to the state. As the Soviet politicaltheorist Alexander Tsipko put it in 1991,"Can Moscow secede from Moscow?"That is, could Russia lose its empire andstill preserve a historically recognizableRussian state identity?

Nation or empire?For most of history, the leaders of Russiaand the U.S.S.R. have ruled over largenumbers of non-Russians, such as Ukrai-nians, Poles, Finns, Armenians, the Bal-tic peoples, and large numbers of MuslimTurkic peoples in Central Asia. Indeed,while Russians made up a slight majorityin the latter-day U.S.S.R., ethnic Rus-sians were just 44% of the population ofimperial Russia, according to the censusof 1897.

Post-Soviet Russia is now properly a"nation-state," but with a difference. Thisstate established itself not by acquiringterritories and peoples in the classicalWest European manner but in acquiesc-ing in the secession of large swaths ofterritory and millions of people. As a re-sult 25 million Russians and 35 millionRussian-speaking peoples now live out-side of the borders of their ethnic home-lands. (There are 1.7 million Russiansand Russian speakers living in the threeBaltic states, Estonia, Latvia andLithuania. Ukraine has a Russian popula-tion of 11.4 million; they constitute 20%

is)

CzechoslovakiaHungary

Union of Soviet Socialist Republics

mawMediterranean Sea 41Pr

Aral Sea

THE SOVIET BLOC, as it was constituted from 1945 to 1989, included the current /2 CIS republics,the 3 Baltic states and the 6 nations of Eastern Europe.

2S1

of the population and a majority in theCrimean peninsula.)

Because the historical Russian empireruled over so many nationalities, reformsdesigned to modernize the country nevermade much headway. Russian and laterSoviet reforms, such as those underAlexander II (1855-81) and Nikita S.Khrushchev (1953-64), ground to a haltin part out of fear that political and eco-nomic control would pass into non-Russian hands on the periphery of theempire. The concern to maintain the sta-bility of a multinational empire, and inparticular the dominance of the Russianruling class, always led Russian reform-ers to choose autocracy over liberaliza-tion. Yegor K. Ligachev, who until 1990was second in command of the SovietCommunist party under Gorbachev,argued forcefully for preserving the lead-ing political role of the Soviet Commu-nist party. He insisted that there was noother authority capable of integrating thediverse interests of the various nationali-ties within the Soviet Union.

The Soviet legacyOnly in the Gorbachev years (1985-91)would the Soviet government, reflectingGorbachev's control of both the Commu-nist party and government, push eco-nomic and political reforms to the pointwhere they undermined the state. The re-

suiting collapse of the U.S.S.R., and withit most institutions of public authority,left all of the governments and peoples inthe post-Soviet states, Russia included,facing two enormous challenges. Thefirst is to build effective institutions prac-tically from the ground upmost impor-tantly, effective constitutional govern-ment, a market economy and respect forthe rule of law. The second, and even

ABBREVIATIONS

cis Commonwealth of Indepen-dent States

NATO North Atlantic TreatyOrganization

U.S.S.R. Union of Soviet SocialistRepublics

more difficult challenge, is to build all ofthese institutions at the same time and inan unsettled international environment.Yet a prerequisite for political democ-racy, recent history shows, is an effec-tively functioning market economy. Buta modern market economy requires aneffectively functioning legal system, anda prerequisite for the latter is the exist-ence of a strong and competent state andstate administration. Russia and its ex-Soviet neighbors do not have the optionof developing these institutions gradu-ally, in a step-by-step fashion.

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ROW, MANS/RID

Can the heirs of a formerly totalitarianempire make rapid and stable progress topluralist political systems? Can they doso without effective public institutions?Can they achieve the legal and economicprerequisites for constitutional govern-ment, not to speak of democracy (whichmay be the ultimate aim, although formany Russians it clearly is not), withouta strong state? Unfortunately, so many ofthe voices calling for a strong state in thepost-Soviet region are also those mostopposed to democracy, a marketeconomy and the rule of law.

Yeltsin's nationalismRussian President Boris N. Yeltsin, him-self an ex-Communist leader who brokewith Gorbachev in the late 1980s becausehe believed that Soviet reforms were notgoing fast or far enough, is the first rulerin Russian history to renounce Russianimperialism as contrary to the interests ofthe Russian people. According to Yeltsin,controlling large non-Russian popula-tions requires a dictatorship that is as op-pressive for the Russians as it is for thenon-Russians. Second, securing the loy-alty of non-Russian subjects so that theywill collaborate in imperial rule requireseconomic outlays that Russia cannot af-ford. In other words, Russia must give upthe idea of rebuilding an empire if Russiais to have a chance to flourish.

GREAT DECISIONS 199S 27

RUSSIA.AND ITS 1111011114*S..

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OCTOBER 1993: AFTER YELTSIN attempted to dissolve parliament,hundreds of legislators barricaded themselves in the building. Yeltsinordered troops to retake the burning building. Scores were killed in thefighting.

Borii N. YeltsinYeltsin joined the Communist party in 1961 and quickly rose inthe ranks. In 1985 Gorbachev appointed him head of the Mos-cow Communist party organization. Taking advantage ofGorbachev's policy of glasnost (openness), Yeltsin called formore radical political and economic reforms. Gorbachevpromptly dismissed Yeltsin as Moscow party boss in 1987, buthe bounded back onto the political scene in March 1989, whenhe was elected a deputy to the Soviet parliament in the first con-tested national elections in Soviet history.

Yeltsin broke with the Communist party in July 1990. InJune 1991 he was elected president of the Russian Federationwith 57% of the votes and became Gorbachev's chief rival.Wien antireform hard-liners attempted to overthrowGorbachev in August 1991, Yeltsin scrambled atop a tank andmobilized hundreds of thousands of pro-democracy protesters.

The coup failed; Gorbachev returned to Moscow and resignedas party leader. On December 8, 1991, the U.S.S.R. ceased toexist; Yeltsin and the leaders of Ukraine and Belarus met inBrest, Belarus, and formed the Commonwealth of IndependentStates (CIS).

Power struggles between Yeltsin and the parliament haveraised questions about Yeltsin's commitment to democratic re-form. The parliament tried unsuccessfully to impeach Yeltsin inMarch 1993. Six months later, on September 21, Yeltsin dis-solved the parliament. Ruslan Khasbulatov, the leader of theparliament, and his supporters impeached Yeltsin, appointedVice President Aleksandr Rutskoi to the presidency and occu-pied the parliament building. In October, Yeltsin ordered troopsto storm parliament, arrested opposition leaders and resumedpower. Ruling in large part by decree (he issued 2,300 decreesin 1993 alone), Yelstin will most likely run for reelection in1996. J.L

Through early 1992, Yeltsin's rathertolerant nationalism was central to therise of a Russian nation-state committedto democracy, market economics and therevival of Yeltsin's own political for-tunes. He was able to mobilize largenumbers of Russians to support his ideathat the U.S.S.R., while perhaps an ex-pression of Russian power in the world,was detrimental to the welfare of Rus-sians at home. Ironically, the August1991 coup to depose Gorbachev by Com-munist hard-liners, who believed his re-forms were undermining the party andthe state, upset the preferred timetable ofYeltsin and his nationalist colleagues inUkraine and elsewhere. They assumedthey had several years to prepare for astable transfer of authority from centralSoviet agencies to newly sovereign re-

_ _

28 GREA1 DECISIONS I99 5

publican governments. Instead, the failedcoup triggered the collapse of all Sovietpolitical and economic institutions.

This had a more unsettling effect inRussia than elsewhere because it pro-voked the collapse of consensus on themeaning of Russian nationalism. Beforethe Soviet breakup, a broad spectnim ofRussian opinion rallied around Yeltsin'santi-Soviet, anti-Gorbachev nationalistplatform. Whereas the other republicssuch as Ukraine could continue to mobi-lize nationalist opinion, directed nowagainst Russia rather than the U.S.S.R.,Russia itself was at a disadvantage. Rus-sians, many of whom identified theirhomeland with the U.S.S.R., had not yetthought through what it meant to be Rus-sian outside of the Soviet empire. WithGorbachev in power, with his strong

3.1

commitment to a powerful central Sovietstate, it was possible to unify Russians'nationalist sentiment against something.The rapid and unexpected collapse of theU.S.S.R. meant that henceforth Russiannationalism would have to stand forsomething, a much more difficult politi-cal task.

Thus, the problem of defining Russianforeign policy and Russia's national in-terests is connected to the lack of agree-ment within Russia as to its basic identityand role in the world.

Reaction to the loss of empireThe current debates in Russia about theboundaries of the state and Russianforeign policy are intimately related.Russia is not accustomed to thinking ofits immediate neighbors, the other 11

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RUSSIA AND ITS NEIGHBORS

members of the loose federation knownas the Commonwealth of IndependentStates (CIS) and the Baltic states, as for-eign countries. Hence the term "the nearabroad" that Russia uses to describe theformer Soviet republics.

The issue of whether to defineRussia's relations with the near abroad asprimarily a matter of domestic policy orof foreign policy goes to the heart of con-temporary Russian politics. Its impor-tance can hardly be exaggerated. It cutsacross two interrelated questions: Can aliberal Russian state be built if Russia re-tains imperial responsibilities outside ofRussia? Reconstituting and then manag-ing an empire would require a degree ofcoercion that could spell the end ofRussia's liberal prospects. Second, canan effective foreign policy be constructedin the absence of Russia's historical em-pire? Hasn't Russia become so interde-pendent with its former colonies that thetriumph of multiple nation-states on theterritory of the former U.S.S.R. spells the

end of Russia as a factor in world affairs?Both Russian liberals and reactionar-

ies reject the idea of treating the other re-publics and the Baltic states as if they areforeign. This has influenced the mannerin which Russia defines and executes itsforeign policy.

Recent Russian relations with some ofthe other republicsnotably Moldova,Georgia, Tajikistan, Armenia andUkraineprovide some indication ofRussia's future policy toward the nearabroad. In Moldova, beginning in 1992,the Russian 14th Army, together with theDefense Ministry, cooperated closelywith local Russians to bring about the se-cession of eastern Moldova: eventually,under such Russian pressure and in theabsence of support from the U.S. or Eu-rope, Moldova joined the CIS. In Geor-gia, the Russian military, with the sup-port of the Defense Ministry but in oppo-sition to existing government policy,armed Abkhaz secessionists to put pres-sure on the Georgian government, now

headed by ex-Soviet foreign ministerEduard A. Shevardnadze, to cooperatemore closely with Russia. This destabi-lized the country and pressured it intojoining the CIS. In the end, the Russiangovernment, including the Foreign Min-istry, backed the military's actions inGeorgia. In the case of Tajikistan, theRussian government and legislature au-thorized the dispatch of the 201st Motor-ized Rifle Division to police the Tajikborder with Afghanistan. (Both countriesare mired in civil wars.) Once there, theRussian army supported various politicalfactions in that country, mainly by thesurreptitious delivery of arms to bothsides. (In another example of politicalinitiatives by the Russian military, nego-tiations in September 1992 to settle thewar between Armenia and Azerbaijanwere directed by Russian DefenseMinister Pavel Grachev, to the surpriseof senior Russian Foreign Ministryofficials.) In Ukraine, Russia used eco-nomic pressure to obtain concessions on

1917FEBRUARY: February Revolution: Popu-lar revolt leads to abdication of CzarNicholas II and creation of provisionalgovernment.NOVEMBER: November Revolution(October according to Old Style calen-dar): The Bolsheviks, a radical Marxistparty, led by Lenin, Trotsky and Stalin,overthrow provisional government andestablish Council of People's Commis-sars. The Communists (formerly Bol-sheviks) win civil war (1918-21) andform Union of Soviet Socialist Repub-lics (U.S.S.R.).

1924JANUARY 21: Death of Lenin: Internalpower struggle ensues. Stalin emergesas absolute ruler.

1945-48U.S.S.R. Gains Sphere of Influence inEastern Europe: With the defeat of NaziGermany in 1945, U.S.S.R. extendsinfluence in Eastern Europe, imposesCommunist rule. In 1946, British PrimeMinister Winston Churchill declaresIron Curtain has fallen between theCommunist East and the democraticWest.

1913MARCH 5: Death of Stalin: Khrushchevbecomes secretary-general of Commu-nist party September 12.

Timeline 1917-941956

OCTOBER: Soviet troops crush anti-Communist uprising in Hungary.

1961Berlin Wall Erected: Built to restrict EastBerliners from fleeing West for freedom.Major symbol of cold war.

1962OCTOBER 22-28: Cuban Missile Crisis:Soviet attempt to base nuclear weaponsin Cuba leads world to brink of war.Khrushchev's withdrawal of weaponsdefuses crisis.

1964OCTOBER 15: Khruslwhev Ousted:Brezhnev takes power in an intra-partycoup.

1968AUGUST 20.21: Soviet invasion ofCzechoslovakia ends Prague Spring.

1979DECEMBER 27: Soviet troops invadeAfghanistan.

1982NOVEMBER: Death of Brezhnev: Suc-ceeded by Andropov. After his death twoyears later, Chernenko becomes leader.Hi dies in 1985.

1985MARCH 11: Gorbachev New Leader ofU.S.S.R: Calls for perestroika (restruc-turing) and glasnost (openness).

PaaNnU AtIAII ACII

1989MARCH: First-ever contested nationalelections for parliament in U.S.S.R.NOVEMBER: Berlin Wall comes down.

1991JUNE 12: Yeltsin elected President ofRussian Federation.AUGUST 19-21: Anti-Gorbachev hard-liners attempt coup in Moscow.

SEPTEMBER: U.S.S.R. recognizes inde-pendence of Baltic. states (Latvia,Lithuania, Estonia).DECEMBER X: Leaders of Russia, Ukraineand Belarus declare end of Soviet Union,creation of Commonwealth of Indepen-dent States (CIS).

DECEMBER 25: Gorbachev resigns aspresident of U.S.S.R.

1993OCTOBER: Yeltsin orders troops to stormparliament, arrests opposition leaders.DECEMBER: Zhirinovsky wins 24% ofvotes cast for party candidates forparliament. New Russian constitutionreplaces Communist-era constitution of1977.

1994SEPTEMBER: Clinton and Yeltsin holdsummit on nuclear and economic issuesin Washington, D.C.


RUSSIA AND ITS NISONIOR5

Controlling nuclear armsBOTH RUSSIA AND THE WEST have been operating on theassumption that by transferring all ex-Soviet nuclearweapons to Russia, the problem of post-Soviet nuclear

arms control will thereby be solved. This seems highly ques-tionable. The lack of effective public institutions, the absence ofeffective civilian control over the military, the occasionally du-bious control that the Russian military exercises over itself, andthe polarization of Russian political society underscore the needto rethink classical approaches to nuclear arms control.Whereas during the cold war the central problem of interna-tional security was to insulate the management of nuclear weap-ons from global political disorder, today the primary challengeis to insulate nuclear arms control from domestic political disor-der. When the major nuclear powers can no longer be presumedto be stable states, the time has come to begin to denationalizecontrol over nuclear arsenals. Complete denuclearization is

probably unfeasible politically, if only because of the weaknessof the Russian state and the security that nuclear weapons seemto accord it. But states should consider something like a "two-key" system for nuclear arms control, akin to the dual controlexercised by U.S. and West German forces over nuclear mis-siles based in West Germany. Control would be shared by na-tional and international agencies. (Some degree of national an-timissile defense should probably be part of such an approach,if only to serve as an element of psychological assurance forstates who would be asked to cede an essential element of theirsovereignty over vital security interests.) The political benefitsof such an approach for Russia's relations with its neighbors, aswell as for strategic stability and the prospects for the nuclearnonproliferation regime, may prove to be considerable. Absentthat, nuclear stability will depend on a Russia which, by all evi-dence, may be no more stable than Ukraine, which under con-siderable international pressure only recently committed itselfto giving up its nuclear weapons.

transferring nuclear weapons to Russia.Based on these examples, one can

make some generalizations about thepossible future shape of Russia's rela-tions with the near abroad.

First, there wil: not be a formal recon-stitution of empire, even within the CIS.Moscow consid trs the economic and po-litical costs of empire too high. On thispoint, there is broad consensus amongRussian politicians. And politically, forRussian reformers, empire implies autoc-racy over Russians as well as the non-Russians within the empire.

Second, in the event Russia's CIS part-ners violate important Russian interests,they will face Russian political, economicandfailing thesemilitary pressures.

Third, Russia will not face seriousWestern opposition as long as it confinesthe exercise of its political-military influ-ence to the CIS. This was demonstratedby the recent Russian interventions inGeorgia and Moldova.

The final point, and it is one that hascaused ambivalent reactions in states likeArmenia, is that Russia will not take di-rect responsibility for governing itsneighbors. This applies even to Ukraine,where few Russians wish to answer forthe poor state of the Ukrainian economy.

Recent Russian behavior within theCIS follows the historical pattern of rela-tions between the U.S. and Central andLatin America before 1933. America'sown Monroe Doctrine of 1823, designedto prevent Europeans from intervening inthis hemisphere, and especially the 1904Roosevelt Corollary to it, which asserteda U.S. right of intervention to restore "re-sponsible" government, sketches the fu-ture of Russia's relations with the near

_ -30 GREAT DECISIONS 1995

abroad. Russian analysts frequently in-voke this American precedent as an ob-ject lesson in how a great power shouldbehave in its own "backyard." An August1992 report of the Russian SupremeSoviet's Foreign Affairs Commissionstated that "the Russian Federation's for-eign policy must be based on the doctrinethat proclaims the entire geopoliticalspace of the former Soviet Union thesphere of its vital interests (along thelines of the U.S.A.'s 'Monroe Doctrine'in Latin America)." Few Russians seemto realize that the millions of Russiansliving abroad would become local hos-tages to a pattern of interventionism ontheir behalf. That is, Russian military in-tervention on behalf of Russians living inthe Baltic states or Ukraine would exposethem to nationalist hostility by ethnicBaits and Ukrainians, making life muchmore difficult and dangerous. Moreover,such interventionism would onlystrengthen imperialist and military ele-ments in Russia itself, thereby threaten-ing remaining prospects for constitutionalgovernment.

The Russian militaryThe Russian state's loss of fiscal control.reflected in its inability to raise adequatetax revenue, has placed the military in adire budgetary bind. More broadly, in theabsence of competent public administra-tion and a lack of consensus about thenature of Russia and Russian interests,the military has acted unilaterally as theguardian of the nation's alleged interests.It has done so in a manner unprecedentedin the Soviet period. While the Russianmilitary has been a reluctant participantin day-to-day domestic politics, it has not

3 5

hesitated to assert Russian power inneighboring states, such as Moldova andTajikistan.

The fact that many in the Russianmilitary have become activists in foreignaffairs is due to a number of causes. Thestate's administrative control outsideMoscow (and even within the capital) isquite limited. Civilian (that is, party andpolice) authority within the military es-tablishment itself has collapsed. There isno effective mechanism to coordinateforeign and security policy. The militarydoes not believe in either the legitimacyor the durability of a purely national Rus-sian state. In short, the Russian state doesnot have the political capacity to fullycontrol the military, while the militaryoften does not have an interest in beingcontrolled by the present Russian state.

In Moldova and Georgia, it was themilitary who made the decision to inter-vene with force. Surprised by theacquiescence of the U.S. and its NATOallies to such coercive moves, the Rus-sian government quickly shifted positionand endorsed the results of the military'saction.

In the Baltic states, the military haspressed consistently for basing and tran-sit rights. In April 1994, Defense Minis-try officials surprised the ForeignMinistry (which learned of the initiativeby fax from the Latvian government) bypublishing an alleged presidential decreecommitting the Russian government tomaintaining 30 military bases in neigh-boring states, including Latvia. Militarybases had just been ruled out in bilateralnegotiations. By summer 1994, theRussian government prevailed andcompleted the withdrawal of Russian

aussta AND* NMOISOIS

military forces from the Baltic region.Russian military officials have repeat-

edly issued public statements on the sup-posedly deteriorating condition ofUkraine's nuclear weapons, with theintent of isolating Ukraine diplomaticallyand denuclearizing it as rapidly aspossible. (In a striking example of mili-tary initiative in foreign policy beyond

the boundaries of the former U.S.S.R.,Russian Deputy Defense MinisterGeorgii Kondratev spoke in April 1993of the Defense Ministry's policy towardthe war in Bosnia-Herzegovina: "TheRussian Defense Ministry [i.e., not theRussian government] gives absolute pri-ority to political methods in settling theconflict.")

State of theRussian FederationTIN SPITE OF IMPRESSIVE maneuvering on

the international scene, the Russia oftoday is arguably not a great power. It israther a very large power, much in theway that in the 18th century China andIndia, which had the largest economies,were therefore the wealthiest countries.Their wealth had nothing to do with theircapacity to modernize. Furthermore, theRussian giant, much like its Ottomancounterpart, is resting on a very unstablefoundation. Recent reports of the Berlin,Kiel and Halle economic institutes inGermany present a devastating picture ofthe state and prospects of the Russianeconomy:

o an economic decline in the indus-trial economy in each of the past three tofour years that is up to twice as bad asthat suffered in the U.S. during the worstyears of the Great Depression in the1930s;

Q the absence of the political strengthneeded to bring about genuine structuralchange in the economy. To date there hasbeen hardly any progress. For example,according to Russian Economics Minis-ter Alexander Shokhin, half of theRussian government's 1994 program tostimulate investment was never imple-mented;

t corrupt and incompetent financialadministration that led to at least $15 bil-lion (and perhaps as much as $25 billion)in capital flight abroad in 1993;

VI insufficient security for investors,domestic or foreign;

i inability of the central governmentto collect as much as 50% of the tax rev-enue needed to finance an admittedly un-realistic budget, according to the RussianFinance Ministry.

There are more optimistic views ofthe state of the Russian economy and thecourse of Russian reform. According toJohn McLaughlin, an analyst for the Cen-tral Intelligence Agency (CIA), "Russianeconomic reforms have made enormousprogress in the two and a half years sincethe breakup of the Soviet Union."Russia's private sectorwhich goeslargely unrecorded in the official eco-nomic statisticsis expanding rapidlyand now accounts for about 40% of Rus-sian gross domestic product, double thefigure in 1991. Two thirds of domesticretail trade took place outside state chan-nels in 1993, compared with one third in1991. And inflation, which hovered infour digits less than two years ago, wasreduced to less than 10% per month in1994. There are other structural signs thatreform is proceeding apace: services arenow contributing more to the Russianeconomy (50%) than manufacturing.suggesting that the country is now devel-oping the beginnings of a more balancedeconomy; unemployment is significantlylower than expected, reflecting the startof a functioning labor market. Such de-velopments led futurologists DanielYergin and Thane Gustafson, authors ofthe 1993 book Russia 2010, to write that"the new market economy...is develop-ing in Russia much faster than is gener-ally recognized." "Elements of Russiancapitalism are already in place. Early inthe next century, people may even betalking about 'a Russian economicmiracle.'"

To a certain extent, the picture ofunprecedented decline in the holdoverSoviet economy and the rise of a vibrantnew private and service economy are two

sides of the same coin. Indeed, it wouldbe fatal to the prospects of Russian eco-nomic reform if there were an increase oreven a stabilization in state-run obsoles-cent industrial and military production.Yet the weakness of Russia's public in-stitutions has undermined much progressthat has been made. Most dramatically,organized crime has stepped into thebreach of state authority and dominatesthe privatization of Russian industry, oneof the most highly advertised success sto-ries of the government. In what BernardGuetta of the French daily Le Monde hastermed the "biggest holdup in history,"Russia's criminal "mafia," in combina-tion with many in the old Communistelite, have taken over much of theeconomically valuable property inRussia. The consequencessuch asmassive capital flightare far from help-ful to the future productivity of the Rus-sian economy. Russia's Tass-Krim pressagency has reported that the Russianmafia "privatized between 50% and 80%of all shops, storehouses, depots, hotelsand services in Moscow." According toYeltsin adviser Piotr Filipov, who headsthe Center for Political and EconomicAnalysis, criminal elements control40,000 privatized enterprises and collectprotection money from 80% of thecountry's banks and other privateenterprises.

The pace of Russian reform has si-multaneously destroyed the foundation ofthe Communist system in Russia (and byextension its ex-Soviet neighbors) andcondemned it to a highly unstable patternof political and economic development.The outcome, in the best case, is morelikely to be a corrupt and highly (but in-efficiently) state-regulated Latin Ameri-can-style economy than a North Ameri-can or West European model. This wouldnot be a bad outcome in comparison topast Soviet and Russian history, but itwon't lead to democracy or internationalstability for Russia and its neighbors.Even in the event of years of relativelysuccessful economic development, thecentral Russian state will be in no posi-tion to recapture the position of its Sovietor imperial predecessor and thus will notbe a significant geopolitical factor muchbeyond the borders of the former SovietUnion.

The state of the Russian military illus-trates the point:

to the ratio of officers to enlisted menis 1.2:1, reflecting the rapid and chaotic

3 4GREAT DECISIONS 1995 31

contraction of the ex-Soviet army in Rus-sia (which is more than a million menunder strength);

there is very little political controlover the armed forces;

III it took the Russian military oneyear to organize a force of 15,000 men topolice the frontier of Tajikistan;

military procurement has fallencatastrophically: whereas the SovietUnion produced 3,000 combat tanks in1988, Russia produced 200 in 1993 (andprobably purchased considerably fewerthan that). Likewise, whereas in the early1980s the Soviet Union produced 100different types of military aircraft, in1993 the Russian government purchasedjust 17 military aircraft of all kinds.

In consequence, the Russian ground

RUSSIA MID ITS Nii0111101tS

forces are effective only for internal useor against a third-rate power. They lackthe capacity to project power or to en-gage in sustained combat against a com-petent, modern military force, such asthat of Turkey. The state of the Russianair force, and especially that of the navy,is much worse. Moreover, Russia'snuclear weapons (see Topic 2) serve anexclusively defensive deterrent purposeand do not translate into far-reaching in-ternational political influence for theRussian state.

Russia, in short, is far from being thesuperpower that the U.S.S.R. indisputablywas. How, under these circumstances,should the U.S. formulate its policy to-ward a country that it has long thought ofas its peer on the world stage?

Policy considerationsrr HE UNPREDICTABILITY of Russia means

that the West can ill afford to base itsforeign policies on particular assump-tions about the course of Russian politics. .

The spectacular rise of extreme national-ist Vladimir Zhirinovsky, who has calledfor the restoration of the U.S.S.R. by anymeans possible, including nuclear war,underscores this point. (Zhirinovsky'smisnamed Liberal-Democratic party gar-nered 24% of the vote on party lists inthe December 1993 parliamentary elec-tions and became the single largest fac-tion in the Russian Duma, or parliament.)The international conduct of the Russianstate, rather than the day-to-day course ofdomestic politics or policies, would bet-ter serve as the touchstone of Westernpolicies toward post-Soviet Russia. Inthis regard, the critical question is howthe West can make Russia understandthat it must choose between its strong in-clination to intrude in the affairs of theother CIS states and its desire for integra-tion into the West. As long as Russia"wants in," the West has influence overit. But the West must first become seri-ous about the Soviet successor-states andEastern Europeabout the incentives forintegration and the penalties for Russianintervention. It makes a great deal of dif-ference whether the West, by its action orfailure to react, encourages orderly Rus-sian influence based on negotiated tieswith its neighbors or a disorderly patternof domination relying on force and arbi-

trary intervention, and thus leading to in-stability in the region and further afield.

With Moldova, Russia began the pro-cess of reestablishing a dominant positionin the former Soviet area. It did so withthe tacit acquiescence, if not approval, ofthe Western powers, including the U.S.The Russian Foreign Ministry and liberaldemocratic circles in Russia were con-cerned that their country would be con-demned for its aggressive behavior inMoldova, Andranik Migranyan, a foreignpolicy adviser to Yeltsin, recently admit-ted. The West, however, feared that anystrong response to Russia over the 14thArmy's actions might be more than theruling democrats could cope with, andtherefore refrained from any serious ac-tions against Russia; whereupon the Rus-sian Foreign Ministry's position shifted.This lack of Western reaction also sent apowerful signal to the Moldovan leader-ship, and that government ultimatelybowed to Russian pressure and agreed tojoin the CIS. Western failure to challengeRussian intervention in Moldova was thusa turning point in Russia's foreign policy.It disproved the liberal Russian argumentthat Russia would pay a price for violat-ing internationally accepted principles ofgood conduct.

U.S. policy optionsBefore addressing the question of policytoward post-Soviet Russia, the Americanpolitical leadership needs to determine


broad U.S. international interests in themost fluid (and unthreatening) global en-vironment this country has faced since itsestablishment as a world power at theturn of the present century. There are atleast five options:-I 1. Extend democracy. Should theU.S. primary interest be ideological, thatis, encouraging the spread of democracyand judging relations with other states bythe extent to which they observe Ameri-can standards of human, political andcivil rights? (See Topic 8.) If so, the U.S.would then be pursuing a policy withoutobvious limitations with respect to regionand degree of economic, geopolitical orsecurity interest involved. Furthermore,such an approach would make policyhostage to the instabilities of the scoresof states around the world, includingRussia, that are unlikely to meet estab-lished Western standards of governanceany time soon. Such a policy, which hasdeep roots in the American tradition,might lead to such frustration that itcould fuel a return to a more unilateralist(if not isolationist) foreign policy on thepart of the U.S._1 2. Promote economic and politicalintegration. Should the U.S. be prima-rily concerned with integrating the larg-est number of major powers, such asRussia, into the Western political-eco-nomic system? If so, then the govern-ment will have to be candid with its con-stituents about the economic costs ofsuch a policy. If it is not, the early diffi-culties of integrationas seen in the caseof German unification or opening West-ern markets to Eastern Europecouldlead to a dangerous backlash.J 3. Maintain balance of power.Should the traditional basic motivation offoreign policypreventing a hostilepower from dominating vital regions andindispensable resourcesprevail? Thiswas the reason behind the U.S. entry intoWorld War II and the cold war. In thewake of the disintegration of the SovietUnion, that is no longer an issue, at leastfor the U.S. and its European allies. Thatfact greatly complicates the task of defin-ing America's international interests in aworld where the U.S. remains the leadingbut not uniquely dominant power.1 4. Give priority to nuclear armscontrol. Should nuclear arms control anddisarmament remain a high priority,since Russia remains essentially the samenuclear power vis-a-vis the U.S. that theSoviet Union was? Certainly, this prob-

lem persistsat least the weap-ons persistbut under radicallyaltered circumstances: at leastone of the nuclear powers (Rus-sia, and relatedly Ukraine andKazakhstan) is a rather unstablestate with inadequate domesticinstitutions, including poor ci-vilian control of the military.(Russia, Ukraine, Belarus andKazakhstan inherited theU.S.S.R.'s nuclear arsenal; theweapons themselves remain un-der the control of Russianforces.) How should nucleararms control be approached un-der these circumstances? Whatprice is the U.S. prepared to payto assure itself of the state ofRussian nuclear forces? For ex-ample, is it willing to submit itsown nuclear arsenal and facili-ties to comprehensive inspec-tion? (See p. 30.)

5. Uphold international or-der. Might not the U.S. choosea policy of influencing the pat-tern of international political or-der? Such an approach, whichwould treat the Yugoslav warsor the behavior of the Russianmilitary in Russia's near abroadas issues of international politi-cal order, requires painstakingdiplomacy and a public base ofsupport. The latter does not yetexist in the U.S. and politiciansseem uninterested in cultivatingit. Aside from the fact that the interna-tional conduct of states tends to be muchmore sensitive to external pressures andincentives than does their domestic behav-ior, the benefits of persistencesuch asin the Middle Eastare high. So, too, arethe costs of negligence, as seen in the warsof Yugoslav succession.

A middle courseTr. date, the U.S. under both the Bush!.nd Clinton Administrations has chosento focus on influencing Russia's long-term international behavior by seeking tohelp transform its domestic institutions inthe short-term. In the process, the U.S.has avoided addressing Russia's currentinternational conduct in the near abroadfor fear of triggering a domestic reactionagainst the Yeltsin government.

Critics of Administration policy haveurged a contrary policy, one that confrontsa Russia they see as having lost its wager

C47,0CMSTS WRIT(11$ SyNDiCali

on reform at home and that is bent on akind of "neo-imperialism" abroad, at leastin its immediate vicinity.

There is a middle course: its advocates,while not indifferent to Russia's domes-tic prospects, seek to make Russia's in-ternational relations the touchstone ofAmerican policy. This course, whichcould potentially integrate the perspec-tives of both the Administration and itscritics, seeks to make Russia choose, on acase-by-case basis, between its parallel in-terests in seeking a dominant position (ifnot hegemony) in the CIS and integrationinto Western economic and politicalinstitutions.

The cause of international order inEurasia, of Russian reform, and even ofthe integrity of the Russian state itselfrequires that Russia and its neighborsobserve restraint and mutual respect intheir relations with each other. They mustavoid commitments that their already

weak economies and politicalsystems cannot support. Theirfailure to make such an effortwould have three consequences:

It would vastly compli-cate the management of a stablenew order in Eastern Europeand the CIS.

It would reinforce, ratherthan deter, extreme nationalistand reactionary forces in Rus-sia who have been arguing thatit can press its neighbors nearand far without the Westresponding.

It would overwhelm aRussian state which, for theforeseeable future, does nothave the capacity to sustainambitious international commit-ments.

The price of 'success'In his recent book Diplomacy,former Secretary of State HenryA. Kissinger remarks on theparallels between British argu-ments in favor of financial anddiplomatic support for WeimarGermany, a struggling democ-racy in the 1920s, and "Ameri-can propositions regarding aidto Russia in the Yeltsin period."In neither case, Kissinger notes,"was there an assessment of theconsequences of the 'success'of the policy being advocated."Just as a strengthened Germany,

whether ruled by an Adolf Hitler or amore moderate German leader, would"be in a position to threaten the equilib-rium of Europe," so would a Russiastrengthened by post-cold-war interna-tional aid programs "produce geopoliticalconsequences all around the vast periph-ery of the former Russian Empire."Kissinger concludes: "America was far-sighted in offering aid to post-cold-warRussia; but once Russia recovers eco-nomically, its pressure on neighboringcountries is certain to mount. This maybe a price worth paying, but it would be amistake not to recognize that there is aprice."

That there is such a price, how high itmight become, and whether the U.S. isreally prepared to pay it, are questionsthat Americans must ask and debate iftheir government is to arrive at a durablelong-term policy toward post-SovietRussia.

3 6 GREAT DECISIONS 1995 33

0

1. How has the disintegration of the So-viet Union affected Russia's internationalstatus and role?

2. How has the Soviet breakup affectedthe international interests of the U.S.?How would you characterize thiscountry's principal interests: to extenddemocracy? integrate all the major pow-ers, including Russia, into the Westerneconomic and political system? controlnuclear arms and pursue disarmament?

3. In its relations with post-Soviet Rus-

RUSSIA AND ITS NEIGHSORS

sia, should the U.S. place primary em-phasis on influencing Russian domesticpolicies (such as economic and politicalreform)? Or should the U.S. pay more at-tention to Russia's behavior abroad, in-cluding its ties with its former Sovietneighbors?

4. Is an evenhanded U.S. policy towardthe former Soviet republics realisticgiven Russia's economic and geopoliticalweight in central Eurasia? What are thelikely consequences of a Russia-focusedpolicy?

5. Does the collapse of the U.S.S.R. callfor a different approach to nuclear armscontrol? What degree of internationalcontrol of U.S. nuclear forces and facili-ties would be acceptable in order to es-

tablish such control over Russia's nuclearestablishment?

6. Would you be willing to-see the U.S.accept a degree of political, economicand military responsibility for encourag-ing stable relations between Russia andits ex-Soviet neighbors? Should Ameri-can soldiers be included in UN peace-keeping units on former Soviet territory?If so, under what circumstances? If not,why not?

7. How would the reestablishment ofRussian dominance in the territory of theformer Soviet Union affect U.S. relationswith Russia? Would it make a differenceif such dominance were establishedthrough cooperative as distinct fromcoercive means?

READINGS ANDRESOURCES

Brzezinski, Zbigniew, "The Premature Partnership." ForeignAffairs, March/April 1994, pp. 67-82. Argues that the U.S.should actively support an independent Ukraine, as this is thebest way to preclude the reestablishment of a Russian empire.

Christopher, Warren, Address in Chicago, 111., March 22, 1993.U.S. Department of State Dispatch, March 29, 1993, pp.17377. The secretary of state argues that the continuation of Rus-sian reforms is the only basis for the U.S.-Russian partnership.

Dawisha, Karen, and Parrott, Bruce, Russia and the NewStates of Eurasia. New York, Cambridge University Press,1993. 457 pp. $19.95. A broad introduction to the challengesfacing Russia and its ex-Soviet neighbors.

Hersh, Seymour M., "The Wild East." The Atlantic Monthly,June 1994, pp. 61-86. An investigative reporter's disturbingaccount of organized crime and eroded government controlover nuclear weapons in Russia.

Human Rights Watch/Helsinki, "War or Peace? Human Rightsand Russian Military Involvement in the 'Near Abroad.' " De-cember 1993. 14 pp. $3.00. (Available from Human RightsWatch, Publications Dept., 485 Fifth Ave., New York, N.Y.10017-6104; $3.00, plus 600 p & h.) Case studies of Ge ".rgia,Moldova and Tajikistan.

Lynch, Allen, "The Soviet Breakup and U.S. Foreign Policy."Headline Series No. 297. New York, Foreign Policy Associa-tion, 1992. 72 pp. $5.95.The author discusses crucial issues theU.S. and Russia face in their new relationship.

Remnick, David, Lenin's Tomb: The Last Days of the SovietEmpire. New York, Random House, 1993. 576 pp. $25.00.

Pulitizer Prizewinning account of the end of empire by aformer Moscow correspondent for The Washington Post.

"Russia: Apocalypse When?" World Press Review, November1994, pp. 8-13. Reprints of articles that appeared in Augustgive international perspectives on Russia.

Zelikow, Philip, "Beyond Boris Yeltsin." Foreign Affairs,January/February 1994, pp. 4-4-55. A discussion of longer-termtrends in U.S.-Russian relations by a former staff member ofthe National Security Council (1989 - -91).

CENTER FOR POST - SOVIET STUDIES (formerly called CENTER FOR THE

STUDY Of SOVIET CHANGE), 2 Wisconsin Circle, Suite 410, ChevyChase, Md. 20815.; (301) 652-8181. A nonprofit, nonpartisanorganization, the center promotes debate on developments inthe region of the former Soviet Union. Its agenda includesnuclear proliferation, ethnic conflict, health and environmentand U.S.-Russian scientific and technical cooperation. The cen-ter publishes a journal, Perspectives on Change, and reports.

CITIZENS DEMOCRACY CORPS (CDC), 1735 1 St., N.W., Suite 720,Washington, D.C. 20006; (202) 872-0933. A private, non-profit organization that mobilizes U.S. private-sector expertiseand resources to assist countries of Central and Eastern Europeand the former Soviet Union. Its services include a data bank, avolunteer registry and periodic conferences.

HARRIMAN INSTITUTE, Columbia University. 420 West 118th St.,New York, N.Y. 10027; (212) 854-4623. The institute spe-cializes in teaching and research on the former Soviet Union 1

and also offers public affairs programs. It publishes TheHarriman Review, a quarterly.


ISAR (formerly called INSTITUTE FOR SOVIET-AMERICAN RELATIONS),

1601 Connecticut Ave., N.W., Suite 301, Washington, D.C.20009; (202) 387-3034. Dedicated to improving conditionsfor people in the former U.S.S.R., ISAR serves as a clearing-house that provides information and answers questions from or-ganizations. individuals and the press. 1

_

How to use the Opinion Ballots: For your convenience, there are two copies of each opinion ballot. Please cut out and mail oneballot per person only. To have your vote counted, please mail ballots by June 30, 1995. Send ballots to:

FOREIGN POUCY ASSOCIATION, 729 SEVENTH AVENUE, NEW YORK, N.Y. 10019remi===ii Nil NI MI 11111 lin 1111 MI fall BIZI Zia Mal MD 13111

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TOPIC

3 Russia and Its NeighborsISSUE A. The principal criterion governing U.S. rela-tions with Russia should be (choose one):

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2 2. Russia's international conduct.I

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I. Continue the policy of economic assistance anddiplomatic cooperation.

2. Cut back economic assistance and take a tougherstance.



ITOPIC

3 Russia and Its NeighborsIIIa

II

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TOPIC

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YES NO1. Isolate, not cultivate, Syria until it

renounces terrorism and respectshuman rights.

2. Support Palestinian statehood.




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TOPIC

4 Middle EastISSUE A. Regarding policy toward the Middle East, theU.S. should:

YES NO1. Isolate, not cultivate, Syria until it

renounces terrorism and respectshuman rights.

2. Support Palestinian statehood.




36

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OPINION BALLOTS

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3g3g36 GREAT DECISIONS 194536 GREAT DECISIONS 1945

Middle East:lasting steps to peace?Israel has signed peace agreements with Egypt, the Palestiniansand Jordan. Will Syria be next? What can the U.S. do to speedthe peace process?

by Lawrence G. Potter

AFTER A CENTURY of tension andconflict in the Middle East, firstbetween Arab nationalists and

Zionists, and later between Palestiniansand Israelis, peace is in prospect for thefirst time. In 1993 the leaders of Israeland the Palestinians finally acknowl-edged each other's existence and com-mitted themselves to negotiating, notfighting over, future relations. In 1994,Israel began yielding control of territoryto a newly constituted Palestinian Na-tional Authority (PNA). Under its direc-tion, Palestinians are poised to expandtheir control throughout the West Bankof the Jordan River. The Israeli-Palestin-ian agreement was the most promisingstep toward peace since Israel normalizedrelations with Egypt in 1979. A peacetreaty between Israel and Jordan fol-lowed last October. The Middle Eastpeace process is clearly back on track,and despite obstacles there seems noturning back.

Why have these achievements comenow, after decades of struggle thatsparked five regional wars? The answeris that the international situation haschanged in the past few years, and thishas had important domestic repercus-sions. With the end of the cold war andthe collapse of the Soviet Union, the stra-tegic importance of the Middle East hasbeen greatly lessened. Local leaders, whocan no longer count on military and eco-nomic backing from the two superpow-ers, realize that they must begin solvingtheir own economic and social problems

LAWRENCE G. POTTER, a longtime contributorto Great Decisions, holds a Ph.D. in MiddleEastern historyfrom Columbia University andis currently teaching at the State University ofNew York at Stony Brook.

and address their citizens' growing de-mands for political participation.

The Persian Gulf war of 1990-91 ex-posed divisions between Arab states andled them to pursue openly their own in-terests. The war also unleashed hostilitytoward the Palestinians, notably YasirArafat, leader of the Palestine LiberationOrganization (PLO), who sided withIraq. The PLO faced a severe economicsqueeze after the war as contributionsfrom erstwhile backers such. as SaudiArabia and Kuwait dried up. At the sametime, the continuing inttfada, or uprising,against Israeli rule in the occupied terri-tories, which broke out in December1987, had convinced many Israelis thatthe costs of holding on had become too

great. Both sides were under pressure tonegotiate, and talks speeded up after theLabor government of Prime MinisterYitzhak Rabin took office in July 1992.

Milestones in peace processThe changed circumstances in the MiddleEast, coupled with strenuous U.S. diplo-matic prodding, led to a number of majorbreakthroughs. First was the Middle Eastpeace conference in Madrid, Spain, inOctoberNovember 1991, at which lead-ers of Israel, Syria, Egypt, Jordan, Leba-non and the Palestinians sat down to-gether for the first time and sketchedtheir version of peace. That conferenceset in train a process of bilateral and mul-tilateral talks to work out the details ofthe peace process.

By 1993, both Israeli and Palestinianleaders feared that time for negotiationswas running out. If they did not strike adeal soon, the rising influence of extrem-ists, such as Hamas among Palestiniansand hardline settlers among Israelis,would prevent them from doing so. SecretNorwegian-mediated negotiations thatsummer led to the landmark Declarationof Principles on Interim Self-GovernmentArrangements signed by President BillClinton, Arafat and Rabin on the WhiteHouse lawn on September 13. The dec-laration called for a five-year period oflimited autonomy for Palestinians in theoccupied territories and, after local elec-tions, negotiations for a permanent settle-

AFTER THE WONINO of the Israeli-Palestinian peace accord, PLO Chairman Yasir Arafat andhis deputy, Mahmoud Abbas, shake hands as (1. to r.) Israeli Foreign Minister Shimon Peres,Russian Foreign Minister Andrei Kozyrev, Israeli Prime Minister Yitzhak Rabin, PresidentClinton and Secretary of State Warren Christopher look on.


ment. If and when Palestinians willachieve their goal of statehood, and Israe-lis theirs of security, are key questions yetunanswered. The handshake between thetwo longtime antagonists was a momentthat galvanized people of the Middle Eastand the world over, and led to a NobelPeace Prize for Arafat, Rabin and IsraeliForeign Minister Shimon Peres.

There has been steady progress sincethen, even if some deadlines have beenmissed. Last May, the parties agreed onthe final details for self-rule in Gaza andJericho. This led to the pullout of theIsraeli army after 27 years of military oc-cupation and the installation of a Pales-tinian government, protected by a policeforce made up of Arafat loyalists. Manywere not sure Arafat would be able tomake the transition from guerrilla leaderto civic administrator and feared that hisautocratic methods would frustrate wide-spread demands for democracy. He alsoseemed unable or unwilling to controlHamas, which launched a campaign ofviolence against the accords, jeopardiz-ing future Israeli concessions on the WestBank.

The key to peace as far as Israel isconcerned is the establishment of normalrelations with its Arab neighbors. Hereevents have moved swiftly. On October26, 1994, Israel and Jordan signed apeace treaty formally ending the state ofwar that had prevailed between them for46 years. The next step, and the most dif-ficult one. is normalization of relationswith Syria. The price Syria demands forpeace is Israel's total withdrawal fromthe Golan Heights, which it captured inthe 1967 war.

End of illusionsThe peace train suddenly started moving,according to Abba Eban, former Israeliforeign minister, "because the Palestinianand Israeli leaderships have awakenedfrom illusions." The Arab illusion wasthat Israel could be destroyed; Israel be-lieved that it could rule indefinitely overa disgruntled people in captured territo-ries. Even tragic incidents, such as an Is-raeli settler's massacre of 29 Palestinians

ABBREVIATIONS

PLO Palestine Liberation Organization

PHA Palestinian National Authority

Unrwa United Nations Relief and WorksAgency for Palestine Refugees inthe Near East


in Hebron in February 1994, or a bcmbblast set off by Hamas in a Tel Aviv buson October 19 that killed 23 people,could not derail it.

In its Middle East diplomacy theClinton Administration has scored a for-eign policy success. Secretary of StateWarren Christopher has demonstrated acommitment to peace by his repeatedtravels to the region, and Clinton himselfmade an election-eve visit to Damascus,Syria's capital, last October in hopes ofspeeding the negotiations. Yet faced withso many world crises, what priorityshould the U.S. give to the region? Howmuch influence does the U.S. have, andhow much is peace in the Middle Eastworth? The price that the U.S. will becalled on to pay has not yet been deter-mined, but will surely be substantial. Be-fore providing financial aid, should theU.S. insist that recipients promise toimplement democracy and respect humanrights? What attitude should the U.S. taketoward Syrian President Hafez Assad,who is accused by the U.S. State Depart-ment of supporting terrorism?

Since September 1993, the clock hasbeen ticking toward a final settlement.Elections in the occupied territories, origi-

nally scheduled for July 1994 and thenpostponed, should lead to the extensionof Palestinian control throughout much ofthe West Bank. "Final status" negotia-tionsto decide the fate of Jerusalem andthe momentous issue of statehoodare tobegin in principle by December 1996 andbe concluded within two years. However,their starting date could be delayed.

The Middle East peace process has al-ways been hostage to domestic politics,especially in the U.S. and Israel. Nationalelections scheduled in Israel by June1996 and the U.S. in November 1996 setthe time frame for action: 1995 will be acrucial year to consolidate peace, for af-terward, both countries' leaders will bepreoccupied with elections. Syria's presi-dent likewise realizes that his best chancefor a deal is now, because if the conser-vative Likud bloc returns to power in Is-rael, negotiations will be much more dif-ficult, if not impossible.

The Arab-Israeli conflict has beentransformed in the last few years. Al-though many details remain to be workedout, both sides have decided to take risksfor peace that bring new hope to atroubled region, perhaps along with newresponsibilities for the U.S.

Palestiniansand Israelis

pALESTINIANS AND ISRAELIS both claimthe territory between the Mediterra-

nean Sea and the Jordan River as their an-cestral home. Each has known the loss ofthis homeland and has been sustained bythe dream of reclaiming it. For two mil-lennia, Jews have longed to return to theLand of Israel. In the 20th century, Pales-tinians have demanded their own state inareas where they constitute a majority.Painfully aware of their own tragic histo-ries, many Israelis and Palestinians havebeen oblivious to the others' suffering.

The names Israel and Palestine bothcome from people who entered the areaaround the 12th century B.C. According tothe Bible, God promised the land toAbraham and later led the Jews (who re-ferred to themselves as the Children ofIsrael) out of bondage in Egypt to safetyin the Land of Canaan. As Jews took overthe interior, the Philistines, a people ofGreek origin, settled on the coastal plains.

41

The word Palestine is derived from them.After 1000 B.C., the Jews subjugated thePhilistines and others and gained controlof the area. They held power on and offfor the next millennium. In A.D. 66, theJews revolted against Roman rule, buttheir rebellion was crushed and theirtemple destroyed in A.D. 70. The Romanslater destroyed Jerusalem, and, in an ef-fort to sever the Jews' link with the land,renamed the territory Syria Palestina, af-ter the Jews' traditional enemies. Mostsurviving Jews were sold into slavery orotherwise scattered throughout the Romanworld.

Most of the population of Palestineconverted to Islam after the Arab conquestin A.D. 637. In the Middle Ages, Christiancrusaders from Europe fought to regainthe Holy Land from the Muslims. Theyestablished short-lived Crusader king-doms, the last of which succumbed inA.D.1291. The Ottoman Turks, based in

Istanbul, captured Palestine, then part ofthe province of Syria, early in the 16thcentury and held it until World War I.

The political contest for Palestine be-gan in earnest in the late 19th century asJews and Arabs were both affected by thetide of nationalism sweeping Europe.Theodor Herzl (1860-1904), a Hungar-ian Jewish journalist living in Vienna,Austria, was one of the founders of mod-ern political Zionism. (Zion is Jerusalem.)Herzl made an appeal for a return of theJews to Palestine at a time of virulent anti-Semitism, manifested by the DreyfusAffair in France (1894-1906) and thepogroms of czarist Russia. The Zionistdream was summed up by the phrase, "aland without a people for a people with-out a land." The problem was that theancestral land of the Jews was not unin-habited. By 1914, about 85,000 Jews livedin Palestine alongside some 600,000Arabs, both Muslim and Christian.

The Balfour DeclarationDuring World War I, Britain promised tosupport the creation of an independentstate or states in the Ottoman-controlledportions of Arab lands if the Arabs wouldrevolt against the Turks. The Arabs, ledby Sharif Hussein of the Hijaz (in present-day Saudi Arabia), agreed. This promiseconflicted, however, with later commit-ments the British made. Foreign SecretaryArthur James Balfour promised in 1917,"His Majesty's Government view withfavor the establishment in Palestine of anational home for the Jewish people,...itbeing dearly understood that nothing shallbe done which may prejudice the civil andreligious rights of existing non-Jewishcommunities in Palestine...."

The Balfour Declaration, a masterpieceof equivocation, did endorse the Zionistdesire for a homeland, but it did not prom-ise to transform Palestine into a Jewishstate. After all, most of the inhabitantswere not Jewish. Satisfying the compet-ing claims of Arab and Jew to the sameland has proved impossible ever since.

After the war, Britain and Francecarved up the Arab portions of the Otto-man Empire into "mandates," in effectcolonies, which were technically super-vised by the League of Nations. Themandate for Syria (including present-dayLebanon) was awarded to France andthat for Iraq and Palestine (includingpresent-day Jordan) to Britain. The man-dates for Syria and Iraq were intended toprepare those countries for independence,

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UNDER THE TERMS of the Israeli-Palestinian peace accord, Palestinians enjoy limited self-government in the Gaza Strip and Jericho. Israel occupies the rest of the West Bank and theGolan Heights, which Syria lost in the 1967 war.

but the Palestine mandate was designedto accommodate Zionist goals as well asbolster Britain's strategic position in theMiddle East.

By World War I, a feeling of Arabnationalism was developing which inten-sified after the destruction of the OttomanEmpire. Arabs in Palestine revolted in1920, protesting that Britain had goneback on its promise to support their rightto self-determination. Zionists were alsounhappy, because by creating the Emir-ate of Transjordan in 1921 in the part ofPalestine east of the Jordan River, Britainreduced the territory available for a Jew-ish homeland. In the 1930s, as more Jewsimmigrated to Palestine to escape Nazipersecution, Jewish-Arab relations wors-ened. In 1936, Arabs held a six-monthgeneral strike, followed by a rebellionwhich lasted until 1939.

That year Britain, which wanted toforestall Arab hostility during the antici-pated war with Germany, announced theending of its mandate in 10 years, if con-ditions permitted. Jewish immigrationwould be strictly limited and restrictionsplaced on land purchases. The Jews felt

BEST COPY AVAILABLE4 2

betrayed, especially since the 1937 PeelCommission, sent by Britain to examinethe causes of the Arab strike, had recom-mended partition, with a small portion ofPalestine allotted for a Jewish state.

Israel's birthAfter World War II the British an-nounced their intention to leave Pales-tine, and Jewish and Arab terrorist activ-ity there increased. Britain turned theproblem over to the United Nations,which in November 1947 passed a reso-lution partitioning Palestine into indepen-dent Arab and Jewish states. The areaaround Jerusalem was to become an in-ternational zone administered by the UNas a permanent trusteeship. The Zionistsaccepted and the Arabs rejected the planas civil war broke out.

Israel declared itself a sovereign stateon May 14, 1948. The following dayArab armies from Transjordan, Syria,Lebanon, Iraq and Egypt invaded, withtoken forces from Saudi Arabia. The Is-raelis prevailed due to their tactical skills(sharpened by wartime service in theBritish army), the lack of an effective

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Arab command and poor morale amongArab armies. Israel extended its controlto 78% of the territory, much more thanit would have received under the UNplan. Armistice agreements but not peacetreaties were concluded between Israeland some neighboring Arab states afterthe war.

The war resulted in major populationshifts. In 1947, the Arab population inPalestine was estimated at 1.3 million andthe Jewish population at 650,000. Afterthe war, the Jews constituted about threequarters of the population in the part ofPalestine that became Israel. About133,000 Arabs remained and becameIsraeli citizens, and an estimated 600,000to 760,000 became refugees. The largestnumber fled to the West Bank, which KingAhdullah (the son of Sharif Hussein) an-nexed to Transjordan (i.e., the East Bank)to form the new state of Jordan. The restwent to Gaza, occupied by Egypt in 1948,and to other Arab countries, especiallyLebanon and Syria.

Arab-Israeli conflictThe conflict between Jews and Arabs thathad been confined to the Palestine Man-date was now transformed into a conflictbetween the state of Israel and its Arabneighbors. Many Palestinians suddenlyfound themselves homeless refugees.Arab governments did not want to inte-grate them into their own countries forpolitical and economic reasons, and mostPalestinians did not want to be assimi-lated, lest their demand for a homelandbe forgotten. Many Palestinians ended upin refugee camps, where they were caredfor by the UN Relief and Works Agencyfor Palestine Refugees in the Near East(Unrwa). But they never forgot their an-cestral homes.

The six-day war in June 1967 was apolitical turning point for the MiddleEast. Provoked by Egypt's closure of theStrait of Tiran, Israel's outlet to the RedSea, and growing war fervor among theArab states, Israel launched preemptiveair strikes against them. Israel delivered ahumiliating blow to the Egyptian, Jorda-nian and Syrian armies and tripled thesize of its territory. Israel captured theWest Bank (including East Jerusalem)from Jordan; the Gaza Strip and Sinaifrom Egypt; and the Golan Heights fromSyria. Over 200,000 refugees, includingmany Palestinians who had taken refugeon the West Bank in 1948, fled to Jordan.

UN Security Council Resolution 242


of November 1967 provided a blueprintfor peace. Under it, Israel would give up"territories" it had captured in June 1967in return for recognition by its Arabneighbors of its right to live in peacewithin secure boundaries. Arabs arguethat all the territories should be relin-quished whereas many Israelis insistparts of the West Bank or Golan Heightsshould be retained on the grounds of se-curity or historic right.

The sense of frustration and despairthat was widespread among Arabs after1967 was particularly acute among Pales-tinians. With their hope that the Arabstates could restore their homelandcrushed, they became more militant un-der the leadership of the PLO. Foundedin 1964 and led since 1969 by Arafat, thePLO carried out terrorist acts to publicizeits cause. The turn to terrorism boostedmorale among Palestinians, but did notthreaten the survival of Israel.

In the wake of the October 1973 v:ar(in which Israel prevailed following asurprise attack by Egypt and Syria), thePLO cultivated a more moderate image.In October 1974 a majority of Arab statesdesignated the PLO as "the sole legiti-mate representative of the Palestinianpeople." But the PLO, expelled from Jor-dan in 1970-71, experienced difficulttimes after the Israeli army forced it outof Lebanon in 1982. Its top officials, ex-iled to Tunisia, were increasingly out oftouch with the situation in the West Bankand Gaza Strip.

Mounting frustration in the occupiedterritories, compounded by the Palestin-ians' sense that they had been abandonedby their Arab brethren, led to an explo-sion. On December 8, 1987, spontaneousdemonstrations broke out in the occupiedterritories after an incident in which fourPalestinian workers were killed by Israelitroops in a traffic accident. This quicklydeveloped into a general revolt againstIsraeli rule.

The PLO was taken by surprise by theoutbreak but moved to assume leadershipof the revolt, or intifada, before extrem-ists gained the upper hand. The decisionof Jordan's King Hussein in July 1988 torelinquish claims to sovereignty over theWest Bank added to the pressure on thePLO to negotiate. In a breakthrough inDecember 1988, Arafat explicitly recog-nized Israel's right to exist, accepted UNresolutions 242 and 338 (which called foran exchange of land for peace) andrenounced terrorism.

43

The Gulf war and aftermathThe war in the Persian Gulf in early1991, touched off by Iraq's invasion ofKuwait, profoundly affected the Palestin-ian community. In retaliation for wide-spread support for Iraq among Palestin-ians, some 300,000 Palestinians wereforced out of Kuwait and the Gulf states.Many fled, destitute, to Jordan. The 1.7million Palestinians living in the WestBank and Gaza Strip, meanwhile, wereprevented by curfews from entering Is-rael, and their living conditions were in-creasingly precarious.

In the war's aftermath, the fortunes ofthe Palestinians seemed at a nadir. WithArafat widely reviled, other Palestiniansfrom the territories emerged as nascentnegotiating partners with Israel. These"more moderate" Palestinians, however,made no secret of their allegiance to thePLO. After much debate, and with fewother alternatives, the PLO agreed to par-ticipate in the 1991 Madrid peace talks.Their aim, as always, was obtainingstatehood; the Israeli government re-mained opposed to statehood but wishedto end the intifada. For almost two yearslittle further progress was made due tofoot-dragging by the Shamir governmentand the reluctance of both sides to makesignificant concessions.

The Washington declarationWhen the Labor government took powerin Israel in July 1992, prospects for nego-tiation brightened. Labor, unlike its pre-decessor, the Likud, was ready for terri-torial compromise. Israeli leaders hadcome to the realization that only the PLOhad the prestige to impose a settlement onPalestinians. A series of secret meetingsled to the historic reconciliation in Wash-ington in September 1993. The acceptanceof partition, rejected by many Palestiniansand long resisted by the Likud govern-ment, now looked inevitable.

The accord called for a five-year pe-riod of transition during which a finalsettlement would be negotiated. Under itsterms, Israeli forces withdrew from theGaza Strip and the West Bank town ofJericho as a Palestinian police force as-sumed control. Last August, Israel agreedto hand over authority for education,health, tourism, tax collection and socialservices. The Palestinian national anthemwas sung and the Palestinian flaglongbanned in Israeli-controlled territorywas saluted in West Bank schools last

fall. The transfer of the remainingspheres of authority, however, was ex-pected to be delayed until the end of1994 due to a lack of funds.

Israel has retained extensive powers,including responsibility for external secu-rity, settlements and foreign relations. Is-rael has also delayed giving the go-aheadfor elections for a ruling Palestiniancouncil, since it is first obliged to pullback its troops and believes the safety ofIsraeli settlers cannot yet be assured.During times of tension the Israeli gov-ernment has temporarily sealed off theterritories, preventing 60,000 Palestiniansfrom reaching jobs in Israel. Arafat hasdenounced this as a form of collectivepunishment, but some Israelis believethat only by separating the two peoplescan they have real security. Some Israelisbelieved their government was ready toyield land that properly belonged tothem. They regarded the PLO as an un-trustworthy negotiating partner whichcould not control, let alone fosterprogress in, the occupied territories.

Some Palestinians dismissed the agree-ment as "largely a matter of mood andatmospherics." In the words of ProfessorRashid Khalidi of the University of Chi-cago, "this accord can be described as nomore than an agreement to agree." Withthe final outcome of negotiations uncer-tain, many Palestinians feared that thesmall areas vacated by Israel might be allthey would get. The agreement did notaddress crucial issues such as the bordersbetween Israel and Arab states, the rightof refugees to return, the issue of Pales-tinian statehood or the status of Jerusa-lem. But the majority of Israelis and Pal-estinians were inclined to give peace achance, for they saw no alternative.

One source of tension is Arafat him-self, who is accused of being too auto-cratic and refusing to delegate authority.Palestinians in the territories have longbeet, exposed to Israeli democracy andare demanding no less for themselves.Another obstacle is Islam-inspired mili-tant groups, such as Hamas and IslamicJihad, which oppose the Israeli-Palestin-ian accord. They have attacked Israelisoldiers and civilians, as well as Arafatsupporters. In November, anti-ArafatPalestinian protesters in Gaza weregunned down by Palestinian police, leav-ing at least 12 dead and as many as 200wounded. The clash, which brought Gazato the brink of civil war, was the mostserious challenge yet to Arafat.

MIDDLE IASI

The PLO is counting on outside assis-tance as tangible evidence that its agree-ments with Israel will provide concretebenefits. Although the international com-munity has pledged to provide $2.4 bil-lion over a five-year period, by late 1994less than $100 million had been dis-bursed. More will not be forthcominguntil the PLO gets its economic house inorder.

Although the key issue for the Pales-tinians is that of statehood, other "finalstatus" issues to be resolved during thefinal period of negotiations to begin byDecember 1996 include:

Jerusalem. Since the capture ofthe eastern portion of the city fromJordan in the 1967 war, Israeli govern-ments have insisted that a united Jerusa-lem must remain under its sovereignty.Palestinians have responded with equalforce that East Jerusalem is an Arab cityand must be the capital of their state.(The U.S. has never recognized Israeliannexation.)

Jerusalem has long been regarded asthe most intractable and emotional issue.It is only partly a religious one: for Jews.Jerusalem is the holiest site; for Muslims,it is second only to Mecca and Medina.Jerusalem is also a political issue. ThusArafat denounced the peace treaty be-tween Israel and Jordan because in it Is-rael acknowledged the "historic role" ofJordan's King Hussein as guardian of the

NOEA.111 4111,10

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Islamic shrines in Jerusalem. This under-mines Arafat's and Palestinians' claim onthe city.

Refugees. Palestinian refugees de-mand the right to return to their formerhomes, or at least to receive compensa-tion for them. Israelis fear an influx thatcould alter the Jewish nature of the state.The status of the refugees who left in1948 and their descendants-2.8 millionpeople, according to the UNis not cov-ered in the agreement. Those who left in1967 may have a case for return. Pales-tinian estimates put these at 800,000while Israeli figures suggest 250,000.Whatever the true number, many nowhave roots in other countries and willprobably not want to return.

Settlements. There are some130,000 Jewish settlers in the occupiedterritories at present and Palestinianswant further settlement activity to stop.Many Israelis live in the territories be-cause of cheap housing, tax relief andeducational benefits, not for ideologicalreasons, and would probably respond toeconomic incentives to return.

at Security arrangements. One rea-son the PLO accepted the accord was Is-raeli willingness to ,:now a Palestiniansecurity force to take control in the desig-nated areas. The size and strength of anyfuture force, the nature of its arms, andits relationship with Israeli forces aresubjects of great Israeli concern.

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JERUSALEM: PALESTINIAN AND JEWISH peace activists march together shortly before thesigning of the 1993 peace accord.

44 GREAT DECISI (I N S 1995 41

7srael and itsArab neighbors

EVER SINCE THE FOUNDING Of Israel,Arab governments have maintained

that a just settlement of the Palestinianproblem was their regional priority. Thedream of many Palestinians, and thepremise that has long dominated Arabdiscourse, is that they would be allowedto return to their former homes. The largenumbers of refugees have been a con-stant reminder of the region's unfinishedbusiness.

The idea of "revolution until victory"promoted by the PLO has now beenabandoned. Most countries of the regionconsidered the 1993 Declaration of Prin-ciples as the best hope for a solution. AJordanian newspaper columnist, Fand al-Fanek, put it this way: "Those who rejectpeace must offer an alternative, whichcan only be war. Otherwise they seem toadvocate further delays and paralysis fora few more decades with no obvious ben-efit. Paralysis only means that we wouldbe negotiating tomorrow for gains wecould have taken for granted decadesago. Wars have proven catastrophic forthe Arab world. Call it a new mind-set;call it realism. These are the new facts ofife."

Settlement of the issues that divide Is-raelis and Palestinians is closely linked tothat of normalizing Israel's relations withneighboring Arab states. There is a basicasymmetry in the bargaining structure,though, notes Mark A. Heller of Tel AvivUniversity: "The Palestinians can getmost of what they seek from Israel, butthey can provide no more than a smallpart of what Israel looks for. Most of thebenefits Israel anticipates can only comefrom the Arab states." The main benefitsIsrael seeks are the reduction or elimina-tion of the security threat, the end of theeconomic boycott, reciprocal recognitionand the exchange of diplomats. RecentlyIsrael established low-level diplomaticties with Morocco and Tunisia. In Sep-tember 1994, six Persian Gulf states (in-cluding Saudi Arabia and Kuwait)announced they were abandoning parts ofthe Arab boycott of Israel in effect since1948. Although they still refrain fromdealing directly with Israel, they will nolonger boycott companies that do

42

SAST

business with it either directly or throughthird parties.

The most crucial relations for Israel toresolve are with the states it borders: Jor-dan, Syria and Lebanon.

Jordan. Jordan is an accidental coun-try, whose borders were drawn by theBritish after World War I and whose sizedoubled after World War II with the an-nexation of the West Bank. The rulingHashemite family, imported by the Brit-ish from the Arabian peninsula, devel-oped a constituency among the Bedouinof the East Bank. King Hussein, who hasbeen on the throne since 1952, is consid-ered an astute ruler, yet he is now layingthe groundwork for a political future inwhich the survival of the monarchy is indoubt. Worries about the succession haveincreased since Hussein publically ac-knowledged in 1992 that he had cancer.Although the king has assured his sub-jects, "Jordan did not begin with me, andit will not end with me," others are not sosure.

The overriding struggle in Jordan to-day is between competing national-ismsone Jordanian, the other Palestin-ian. With over half of Jordan's 4 millionpeople of Palestinian extraction, theythreaten to overwhelm their hosts andturn Jordan into what some claim it al-ready is: a Palestinian state.

King Hussein has long been a cham-pion of the Palestinian cause, and Jordanalone grants refugees citizenship. Yet thepresence of two major, potentially hostileblocs has led to serious tensions in thepast, including a bitter civil war withPLO guerrillas in 1970. (It should benoted that many Palestinians supportedKing Hussein.)

By staying neutral during the PersianGulf war and voicing sympathy for IraqiPresident Saddam Hussein, Jordanaroused the anger of the West and theenmity of the Saudis and Kuwaitis. But itraised the king's popularity at home,which helped him ride out some of theeconomic costs of defiance, which weresubstantial. (With few natural resources,save phosphates, and no oil, Jordan isdependent upon outside aid.) At the out-break of war, Iraq supplied 85% of

Jordan's oil requirements, owed Jordanhundreds of millions of dollars, and em-ployed many Jordanians. Afterward,Jordan's oil supply was cut off, remit-tances from Palestinians dried up, tour-ism was dead and the major port ofAqaba was stilled. Jordan's serious eco-nomic problems are compounded by ahigh birthrate, and now a flood of Pales-tinian refugees.

The Washington declaration of 1993took Jordan by surprise. The king fearedthat the PLO deal with Israel wouldmarginalize Jordanian influence and hurtthe country economically. He thereforeacted swiftly to normalize relations. OnJuly 25, 1994, at a warm White Houseceremony, King Hussein and Prime Min-ister Rabin agreed to make peace; threemonths later they signed a formal treaty.At that time they settled long-standingdifferences over land and water rightsand pledged not to allow third parties tolaunch attacks against the other fromtheir territory. Normalizing relations withIsrael was a crucial step to the Hashemitemonarchy as well as Jordan. Meanwhile,Jordan is back in U.S. favor, and whenIraqi troops menaced Kuwait last Octo-ber, King Hussin was quick to condemnthem.

Syria. The cooperation of Syria is es-sential to a comprehensive Middle Eastpeace. If Israel withdraws totally fromthe Golan Heights, Syria's PresidentAssad assured President Clinton inGeneva in January 1994, Syria is readyfor "normal, peaceful relations." He pro-claimed, "We are ready to sign peacenow. In honor we fought, in honor wenegotiate, and in honor we shall makepeace." Since the summer of 1994,Washington has detected a shift inSyria's public diplomacy. For example,Syrian media had live coverage of thesigning of the accord between Israel andJordan. After years of referee in itsmedia to the "Zionist entity" or the "evilenemy," Israel is now called by name.

Such a policy shift is being forced onAssad by changed international and re-gional circumstances. With the loss of hismajor benefactor, the Soviet Union, andthe stronger U.S. influence in the region,Assad knows that he cannot afford tocontinue Syria's costly confrontationwith Israel. Syria signaled its new,friendlier tone to the West by joining theallied coalition against Iraq. In return forits support, Syria was rewarded with fi-nancial aid from the Persian Gulf states,


The occupied territories-1 Gaza. The Gaza Strip, 25 miles long and 4 to 9 miles wide,is one of the most densely populated regions on earth. About830,000 people live there, three quarters of whom are refugeesfrom the 1948 war or their descendants. The frustration anddeprivation of Gazans, coupled with the apparent indifferenceof the outside world, has fueled resistance movements, espe-cially Hamas and Islamic Jihad.

Gaza's problems are above all economic: although famousfor citrus fruits, it has little industry and its infrastructure iscrumbling. Before the intifada, about two thirds of the workforce held jobs in Israel. Many fewer do now, and they com-plain of low wages and bad treatment by their employers. Jobsecurity remains precarious due to the border closings. In 1992,per capita income was only $1,310 per year as opposed to$2,175 in the West Bank and $10,878 in Israel proper.

With the Israeli occupiers removed, Gazans can go for a bar-becue at the beach, leave home without their ID cards and strollaround all night since there is no longer any curfew. Somewomen are even removing head scarves that had become asymbol of protest against the occupation.

Arafat now makes his home in Gaza. But unless the PLOcan deliver tangible improvements soon, tensions will grow."The combination of severe economic deterioration, gross inse-curity, rapidly eroding living conditions, and continued politicaluncertainty has introduced dynamics that now threaten civilsociety in Gaza," according to Sara Roy, a visiting scholar atHarvard University.J Golan Heights. The Golan Heights is a 45-mile-long fertileplateau that stretches from the Sea of Galilee in the south to theslopes of Mt. Hermon on the Lebanese border. Syrian territoryuntil 1967, the Golan Heights is not considered part of Palestineor the Land of Israel. About 130,000 people lived there beforethe war. Today there are some 35 Israeli settlements with13,000 settlers.

With an average elevation of 2,000 feet, the Golan Heightsoverlooks northeastern Israel. It also contains the headwaters ofthe Jordan River. Between 1948 and 1967, Israel and Syriaclashed in the demilitarized zones along the common border,with Syria shelling Israeli settlements below in response toIsraeli attempts to encroach on the disputed lands. After theGolan Heights' capture, many Israelis vowed not to let it fallagain into Syrian hands. During the 1973 war, Syrian forces re-entered the Golan Heights. A U.S.-brokered 1974 agreementseparated the combatants and assured Israel that the GolanHeights would not be used to stage guerrilla attacks on its terri-tory. Since then the border here, patrolled by UN peacekeepers,has been quiet.

The Likud government formally annexed the Golan Heightsin December 1981, an act denounced by the Reagan Adminis-tration and the UN Security Council. Syria regards the GolanHeights as an inalienable part of the state that is not subject tonegotiation. "Politically speaking, no Syrian leader is likely toaccept less than Egypt has accepted: total Israeli withdrawal inreturn for total peace and mutual and symbolically balancedsecurity arrangements," cautions Professor Muhammad Muslihof Long Island University.

Giving up the Golan Heights is difficult for many Israelis to

contemplate, since they have long been told that it is vital totheir security. But Rabin stated in April 1994, "To me, peace isa more important value for the security and future of Israel thanthis or that group of settlements." In September 1994 Rabin pub-licly disclosed a timetable for a "very slight" withdrawal over athree-year period, but he had previously promised that this "pain-ful price" would only be paid after a national referendum.J West Bank. The land to the west of the Jordan River, about2,270 square miles, is commonly referred to as the West Bank.The Likud government (1977-92) called it by the Biblicalnames of Judaea and Samaria. The region, which includes EastJerusalem, is the prime focus of Palestinian aspirations for anindependent state.

King Abdullah of Transjordan, who had conquered most ofthe West Bank in 1948, formally annexed it in April 1950. Herenamed his newly enlarged country the Hashemite Kingdomof Jordan. After Israel captured the West Bank during the 1967

Ittrusietnhww

GAZA STRIP: Young Palestinians, carrying the portrait ofjailed Hamasleader Shaikh Yassin, protest Arafat's arrest of llamas militants.

war, the Labor government encouraged Israelis to establishsettlements there as a security measure. The Likud greatly ex-panded the number of settlements after it took office in 1977. Itwanted to establish a nucleus of Jewish settlers on the land inorder to frustrate any attempt to relinquish the territories at afuture date.

The Israeli occupation bred hatred and alienation. Israel ob-structed the development of local leadership or effective politi-cal organizations; Palestinian officials who opposed the Israeliswere removed, some deported. Since the intifada began in1987, over 100,000 Palestinians have been detained, and Israeliforces have engaged in "a systematic pattern of torture and ill-treatment." according to the New York-based Human RightsWatch/Middle East.

Many Jewish settlers, who constitute no more than 3% of theelectorate, felt betrayed by the Washington peace agreement ofSeptember 1993 and have mounted angry demonstrationsagainst the government.


4

RIwarmer relations with the U.S., and a freehand in Lebanon.

Syria has long vied with Iraq and Egyptfor supremacy among Arab states. Oncepart of the Ottoman Empire, after WorldWar I Syria became a French mandate.The French, operating on the principle ofdivide and rule, created present-day Leba-non in 1920 by combining the predomi-nantly Christian district of Mt. Lebanonwith areas to the north, south and east thatcontained Muslim majorities. Since inde-pendence in 1946, Syrian governmentshave denied the legitimacy of this act, andhave called for the reunification of"Greater Syria." While this is unlikely,Syria has frequently felt entitled to inter-vene in Lebanese affairs.

Today Syria is tightly controlled byAssad and a close circle of military andintelligence figures. Many come from theAlawite minority, an indigenous religioussect combining Islamic and non-Islamicelements, that has ruled since 1963.Assad, who became president in 1971,has not permitted rival political groups,especially Islamic ones, to gain ground.

In Arab politics Assad's rivalry withArafat and King Hussein is legendary.Unable to control the PLO, Assad shel-ters aboutlO rival Palestinian groups, in-cluding the Popular Front for the Libera-tion of Palestine. Syria is also believed tocontrol or heavily influence Hezbullah orthe Party of God (often described as pro-Iranian). which is based in eastern Leba-non. This has helped Syria earn a placeon the U.S. State Department's list ofcountries supporting terrorism.

Lebanon. Israel's neighbor to thenorth has been a reluctant participant inthe Israeli-Palestinian struggle since thefirst wave of Palestinian refugees arrivedin 1948. After 1970. when Lebanon tookin many Palestinians forced out of Jordan,the fragile internal political balance brokedown. Arafat set up a virtual state-within-a-state for Palestinians, which Israel de-stroyed in 1982. Since that time. Israel hascontrolled a strip of territory in the southto protect settlements in northern Israelfrom terrorist activity, while Syria main-

" tains 40,000 troops in eastern Lebanon,especially the Bekaa valley.

After a bitter civil war from 1975 to1990 among and within the majorgroupsSunni and Shiite Muslims.Druze, Christians and Palestiniansrela-tive calm returned to Lebanon. A peaceplan worked out in 1989 at Taif, SaudiArabia, provides for parity between Mus-

-c;REAr t)t:CISIONS 1995

MOLE EAST

lims and Christians in parliament for thefirst time. The Lebanese government isreasserting control over more of thecountry, and Lebanese entrepreneurs arereturning and starting to rebuild.

Lebanon's major objectives in the cur-rent peace talks are the cessation ofIsraeli retaliatory attacks on its territory;the dispersal of the Israeli-sponsoredSouth Lebanese Army; and Israel's with-

drawal from its self-declared "securityzone." Israel refuses to withdraw untilthe Hezbullah ceases rocket attacks. (Forits part, Hezbullah claims its attacks are alegitimate response to foreign occupationof Lebanese soil.) The continuing spo-radic violence along the Lebanese-Israeliborder keeps the region on edge, but it iscontrolled: neither Syria nor Israel wantsit to get out of hand.

U.S. policy:search for solutionsrr HE GROUNDWORK for the accords

between Israel and the PLO and Jor-dan was laic at Camp David, Maryland,in 1978 and Madrid in 1991. At CampDavid, President Jimmy Carter persuadedEgyptian President Anwar Sadat and Is-raeli Prime Minister Menachem Begin tosign two trailblazing agreements: one pro-vided for Israeli withdrawal from Sinaiand an Israeli-Egyptian peace treaty: theother was a framework for Palestinianautonomy in the West Bank and GazaStrip to be implemented over a period notto exceed five years. No later than the thirdyear, residents were to participate in ne-gotiations to determine the final status ofthe territories. These provisions werenever implemented.

In the decade after Camp David, theArab-Israeli dispute was put on the backburner of U.S. diplomacy. The ReaganAdministration (1981-89) was preoccu-pied with instability in the Persian Gulfdue to the Iran-Iraq War (1980-88) and itsought to build a "strategic consensus" ofregional states to resist Soviet encroach-ment. It was not until Iraq was driven outof Kuwait in Operation Desert Storm thatU.S. diplomats returned once again to theArab-Israeli question.

Flush from the U.S. success in leadinga war coalition against Iraq. the then Sec-retary of State James A. Baker 3d cajoledrepresentatives of Israel, Syria, Egypt,Lebanon, Jordan and the Palestinians intomeeting at Madrid. This unprecedentedconference was intended to initiate peacenegotiations among the parties. No majorconcessions were made, but discussionshad begun. Afterward, however, Bakerwas preoccupied with President Bush's1992 reelection campaign, and the bilat-eral and multilateral talks launched at

4g

Madrid degenerated into squabbles.When the Clinton Administration took

office in January 1993, the diplomaticclimate in the Middle East was favorablefor negotiations. A longstanding policygoal that the U.S. had pursued in the re-gion since World War IIexcluding So-viet influencewas no longer an issue.And continued access to the region's oilseemed assured. The likelihood of warand the region's strategic significance forthe U.S. had declined.

Paradoxically, at the very momentwhen the U.S. had an unprecedented op-portunity to influence regional develop-ments, the new Administration's prioritywas its domestic agenda. Experts on theMiddle East such as Professor MichaelC. Hudson of Georgetown Universityfeared that President Clinton was "squan-dering the inheritance" the U.S. had builtup in the Middle East.

The Administration's guiding prin-ciple was continuity with previous U.S.policy. Clinton's chief Middle Fast archi-tect, the highly regarded Dennis B. Ross,is a holdover from the Bush Administra-tion. Clinton's foreign policy team, how-ever, has been regarded as more pro-Is-rael than that of Bush, and more in tunewith the thinking of the hardline LikudParty than the moderate Labor govern-ment that replaced it. In deference to Is-raeli sensibilities, for example, Adminis-tration spokesmen started substituting theterm "disputed territories" for "occupiedterritories." and stopped referring to EastJerusalem as part of these territories.

After a year in office, however, theAdministration sensed that progresscould be made, and it gave peace in theMiddle East a high priority. Secretary ofState Christopher has made repeated trips

to the area. Clinton himself personallymet with key regional leaders in a whirl-wind visit to the region last October.

What does the U.S. hope to achieve inthe Middle East? Above all, it is trying tokeep the bilateral and multilateral talksfrom foundering. The U.S. knows that arapid improvement in conditions in Gazaand Jericho is essential to build supportfor the peace process, to discredit Hamas,and to build Israeli confidence for furtherconcessions. The U.S. wants to inspireconfidence that this is the beginning, notthe end, of the peace process. The U.S.does not support the establishment of anindependent Palestinian state. A formulathat the U.S. has favored in the past isself-government for Palestinians, possi-bly in confederation with Jordan, al-though no Israeli or Jordanian govern-ment has agreed to this.

The U.S. has prodded Arab states toend their boycott of Israel and to contrib-ute to an aid fund for the Palestinians. Ata conference in Morocco last November,the Administration proposed a multi-billion dollar development bank for theMiddle East, but wealthy Arab stateswere reluctant to fund it. By agreeing tomake peace, Israel and Egypt togetherhave received at least $5 billion annuallybetween them from the shrinking U.S.foreign aid budget for many years. Arabstates would expect a similar payoff inany overall peace settlement.

A more immediate issue is whetherthe U.S. would be willing to providemonitors to police the Golan Heights ifthe Israelis withdrew. (A similar forcehas operated almost without incident inSinai since 1981.) Some Americans ob-ject that it would be too dangerous, tooexpensive and not our job to have U.S.forces on the Golan Heights. The newRepublican majority in Congress mayoppose contributing troops or money toany peacekeeping operation.

For strategic as well as domestic po-litical reasons, Clinton, Rabin and Assadall want to see a peace treaty in 1995.Time is of the essence in light of the up-coming U.S. and Israeli elections.

U.S. policy optionsJ 1. The U.S. should try to isolate,not cultivate, Syria.

Pro: Some warn that, in its zeal to en-list Syria in the peace process, the U.S.should not overlook Syrian complicity insupporting terrorism, its activity in thedrug trade, the government's repression

WHITE HOUSE, July 25, 1994: King Hussein and Prime Minister Yitzhak Rabin, with PresidentClinton looking on, end the 46-year state of war between Jordan and Israel.

of its own people, and its threateningmilitary buildup. Syria, in short, is a"rogue state" and the U.S. should treat itaccordingly, writes Daniel Pipes, editorof the Middle East Quarterly.

Con: Syria is the key to a settlement,and it would not be helpful to cut it out ofthe negotiating process, caution others,among them Richard W. Murphy, aformer U.S. Ambassador to Syria."Americans and Israelis alike tend toplay down Syria's fear of Israel," henotes. "In fact this fear is as genuine asIsrael's fear of Syria." If Syria agrees tosign a peace treaty with Israel and cracksdown on terrorists, the U.S. should re-spond with warmer relations and unblockloans to Damascus by multilateral institu-tions like the World Bank.J 2. The U.S. should support Pales-tinian statehood.

Pro: There is no reason to deny thePalestinians their long-sought goal, espe-cially since they have now agreed topartition the land and respect Israeli sov-ereignty. If statehood is not granted,radicalism among militant groups such asHamas is sure to grow. Israel's best secu-rity is a democratic Palestinian state,demilitarized if necessary.

Con: A Palestinian state would intro-duce an element of instability in theMiddle East, would pose a security threatto Israel and would not be viable eco-nomically. Such a state already exists,namely Jordan, and there is no need foranother one. Moreover, such a stateunder Arafat's leadership would be un-democratic and authoritarian and pro-mote terrorism.

46

_1 3. The U.S. should tie financial aidto Arab states and to the Palestiniansto a commitment to implement democ-racy and respect human rights.

Pro: U.S. aid to Israel's former adver-saries, like Syria, should be conditionalon political reform. In the case of the Pal-estinians, the U.S. "should take a moreaggressive position" promoting democ-racy and should link future economic anddiplomatic assistance to the democratiza-tion process, according to, among others,William B. Quandt, an architect of theCamp David process who is now teach-ing at the University of Virginia. Democ-racy would come naturally to Palestin-ians, who constitute a cohesive, well-educated community.

Con: Democracy, according to someobservers, has little future in the Arabworld. The PLO's chaotic record of ad-ministering most Muslim areas in Leba-non in the early1980s and Arafat's pen-chant for secrecy and quashing dissent donot bode well for democracy's prospectsin the West Bank.

* * *

The conflict waged between Arabs andJews for the better part of this centuryappears to be drawing to a close. Thelogic of peace has finally prevailed overwar. The key regional leadersKingHussein, Assad, and Rabinafter devot-ing a lifetime to the conflict, have tired ofit. They want to see the region at peacebefore they die. This will be their legacyto the new generation that will otherwisecontinue the old, deadly antagonisms.


DISCUSSIONQUESTIONS

1. Since the end of the cold war and su-perpower rivalry in the Middle East, theregion has lost some of its strategic im-portance to the U.S. In that light, is theClinton Administration devoting toomuch time to Middle East diplomacy?too little? or about the right amount?

2. After Israel and the PLO signed theiraccord, the international communitypledged $2.4 billion to help the Pales-tinians get on their feet. By late 1994,only $100 million had been disbursed.Should the remaining funds be un-

blocked? Should strings be attached?Will broken pledges play into the handsof extremists?

3. What U.S. interests would be servedby an end to the Arab-Israeli conflict?Should the U.S. try to speed the processby playing the role of honest broker? Orshould the U.S. give greater priority toother, more pressing domestic and for-eign policy concerns?

4. The U.S. does not support the estab-lishment of an independent Palestinianstate. Yet the U.S. supports the right ofpeople to self-determination. Is there aninconsistency in U.S. policy?

5. Should the U.S. urge Israel to make afull withdrawal from the Golan

Heightsto the line of June 4, 1967, asdemanded by Syriain return for peace?Or should the U.S. support Israeli reten-tion of a portion of the Golan Heights forsecurity purposes?

6. The return of Golan to Syria representsa potential security threat to Israel. Toreassure Israel and speed a peace agree-ment with Syria, should the U.S. offer toprovide troops to patrol the heights, as itdid in the Sinai after Israel returned thepeninsula to Egypt?

7. The U.S. Department of State listsSyria as one of seven states that supportsterrorism. Should the U.S. have any deal-ings with Syria until it renounces terror-ism? Or are there trade-offs to be consid-ered, such as peace with Israel?

ID 1111

"Breakthroughs in the Jordan-Israel Negotiations and RecentDevelopments in the Middle East Peace Process." U.S. Depart-ment of State Dispatch Supplement, August 1994, Vol. 5,Supplement No. 7. Entire issue. Contains text of the agreementbetween Israel and the PLO on the Gaza Strip and Jericho area,signed in Cairo, Egypt, May 4, 1994, as well as remarks byleaders involved in the regional negotiations and much back-ground information.

Journal of Palestine Studies. The leading scholarly journaldevoted to Palestinian affairs, published by the University ofCalifornia Press for the Institute for Palestine Studies and Ku-wait University. Available to individuals for $32 annually (4issues) from the University of California Press, 2120 BerkeleyWay, Berkeley, Calif. 94720.

Lesch, Ann Mosely, Transition to Palestinian Self-Govern-ment: Practical Steps Toward Israeli-Palestinian Peace.Bloomington, Indiana University Press, 1992. 160 pp. $10.95(paper). Sensitive discussion of the policy issues involved andphases of the transition to peace.

"The Middle East, 1994." Current History, February 1994.Entire issue. A number of excellent articles discuss the Israeli-Palestinian accord and relations between Israel and neighboringArab states.

Muslih, Muhammad, "Dateline Damascus: Asad Is Ready."Foreign Policy, Fall 1994, pp. 145-63. The time to resolve theconflict between Israel and Syria is now, and the Clinton Ad-ministration should be actively engaged in pressing the partiesfor peace.

, and Norton, Augustus Richard. "Political Tides in the


Arab World." Headline Series No. 296. New York, ForeignPolicy Association, Summer 1991.72 pp. $5.95. Examines theMiddle East after the Gulf war, and recommends democracy asthe best antidote to dictators like Saddam Hussein.

Quandt, William B., Peace Process: American Diplomacyand the Arab-Israeli Conflict Since 1967. Washington, D.C.,Brookings Institution, 1993. 612 pp. $15.95 (paper). An indis-pensable history by former top policymaker on U.S. involve-ment in peace negotiations over the last quarter century.

Tessler, Mark, A History of the Israeli-Palestinian Conflict. 1

Bloomington, Indiana University Press, 1994. 928 pp. $27.50(paper). An excellent, balanced and comprehensive review.

AMERICA-MIDEAST EDUCATIONAL AND TRAINING SERVICES

(AMIDEAST), 1100 17th St., N.W., Suite 300, Washington, D.C.20036; (202) 785-0022. Amideast seeks to increase under-standing between the U.S. and the Middle East and North Af-rica through education, information and development programs.Experts available to speak.

HUMAN RIGHTS WATCH/MIDDLE EAST, 485 Fifth Ave., 3rd floor,New York, N.Y. 10017-6104; (212) 972-8400. Human RightsWatch/Middle East monitors and promotes internationally rec-ognized human rights in the Middle East.

MIDDLE EAST INSTITUTE (MEI), 1761 N St., N.W., Washington, D.C.20036; (202) 785-1141. MEl serves as a resource centerproviding information on recent developments. Publishes TheMiddle East Journal quarterly, reports, books and a newsletter.

MIDDLE EAST STUDIES ASSOCIATION OF NORTH AMERICA (MESA),1232 N. Cherry Ave., University of Arizona, Tuscon, Ariz.85721; (602) 621-5850. MESA is a nonprofit, nonpartisanmembership organization comprised of academics, students andothers interested in the Middle East and North Africa. Publica-tions include the quarterly International Journal of MiddleEast Studies and the semiannual Mesa Bulletin.

- -

A r-I

Global finance:America's roleand stakesAs the internationalization of global markets accelerates, howcan the U.S. increase the stability of the dollar and continueto attract foreign investors?

by Robert D. Hormats

COG TY HARK,

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I

SIGNS OF THE GLOBAL FINANCIAL MARKET are everywhere, even in Vietnam's Ho Chi MinhCity.

AMONG THE MOST dramatic changeson the world landscape in recent

years has been the rapid integra-tion of national financial markets into alarge global financial market. At thesame time many emerging economicpowers have substantially increased theirparticipation in that global market. Na-tions throughout the worldindustrial-ized, developing and formerly Commu-nistare becoming more closely tied to-gether by increased trade, capital flowsand currency transactions, facilitated byinstantaneous cross-border transmissionof funds and information.

The accelerating internationalizationof financial markets not only affects WallStreet and big financial institutions. Italso has an impact on the cost of a mort-gage in Baltimore, interest payments on acar sold in Kansas City and the price of a

bottle of wine purchased in San Fran-cisco. And it is not simply a phenomenonproduced by big New York investors,major money-center banks or billionairespeculators. It is the result of the cumula-tive decisions of a pension fund managerin Tallahassee who buys German bonds,the selection by an investor in Detroit ofan emerging-market mutual fund, or thechoice by a retiree in Boston of a stock ina Mexican phone company.

These developments in global financehave profound implications for Americanforeign and domestic policy. Along withthe enormous increase in, and growingdomestic importance of, foreign trade,they have raised economic issues to thetop of America's international agendaand tied the U.S. economy ever moreclosely to the rest of the world. ThePresident and Congress, in setting bud-

getary and regulatory policy, and theFederal Reserve, the nation's centralbank, in setting short-term interest rates,must increasingly take into account theattitudes of foreign investors when mak-ing decisions.

Well over $1.5-trillion worth ofAmerican securities is now in foreignhands. The willingness of foreign inves-tors to hold those securities, as well astheir desire to continue to buy Americanstocks and bonds, and the prices at whichthey do so, will directly and significantlyinfluence U.S. interest rates, stock pricesand the value of the dollar. These in turnwill affect U.S. production costs, jobs,profits and growth.

Moreover, American households holdroughly $14 trillion in financial assets.They have the option to sell a portion ofthese and invest elsewhere in the world ifthey lose confidence in U.S. economicpolicy or market performance, or if theysee better opportunities abroad. The re-sultant shift of large sums to foreign fi-nancial markets could jolt U.S. markets.The U.S. current account deficit (thecountry's deficit on trade in goods andservices, such as shipping and banking)is normally considered to be a major fac-tor influencing the movement of ex-change rates. However, an additional 1%shift of American household assets toforeign stocks or bonds$140 billionwould dwarf the likely $125 billion cur-rent account deficit the U.S. accrued in1994.

Turmoil or uncertainty abroad (a crisiswith North Korea, a strike in the oil fieldsof Nigeria, a major trade dispute with Ja-pan, tensions with China or collapse ofthe Russian government)events overwhich the U.S. might or might not havemuch controlcan also materially affectthe value of the U.S. dollar and Americanstocks, bonds and pension funds. That, inturn, can derail even the most well-conceived domestic economic policy.

The major international economic in-stitutionsthe World Bank (or Interna-tional Bank for Reconstruction and De-velopment) and the International Mon-etary Fund (IMF)established at BrettonWoods, New Hampshire, to foster cur-rency stability and global growth, findthemselves on their 50th birthdays alsochallenged by sweeping changes. They

ROBERT D. HORMATS, economist, investmentbanker, ambassador and former deputy U.S.trade representative, is vice chairman ofGoldman Sachs International Corporation.


are trying to adjust to a dramatically newglobal financial climate. They are seek-ing to accommodate the needs of estab-lished economic powers such as the U.S.,which is urging greater emphasis by theWorld Bank on the environment and so-cial development, along with those ofemerging market economies such asChina, Russia and Latin America. Theeffectiveness of these institutions in incor-porating emerging economies smoothlyinto the global market economy and im-proving the prospects of poorer nations,now suffering from a host of social andeconomic calamities that could causethem to become a source of enormous in-

. 011ABAL PINANCI

temational tensions in coming years, iscritical to the future stability of the worldeconomic and political system.

Recent changes in the world economypose a series of difficult questions for theU.S.: How can this country increase thestability of the dollar? How can it con-tinue to attract sufficient investment capi-tal from the rest of the world? What roleshould it ask the IMF to play in the futureto improve currency stability? Howshould the World Bank adapt to complexnew requirements of formerly Commu-nist countries? Can or should the U.S.sustain its historic commitment as theworld's largest aid donor?

Global finance:a sea change

IT IS HELPFUL to review the tumultuouschanges in international finance in

recent years. The rules and institutions ofa new postwar international financial sys-tem were set up at Bretton Woods in July1944. It is difficult today to imagine whatthe world would have been like withoutthe World Bank and the IMFand theirsister institution, the General Agreementon Tariffs and Trade (GATT). However,it is well known what happened betweenWorld Wars I and II when no such coop-erative international organizations ex-isted. That period was characterized byprotectionism, financial turbulence, theGreat Depression and high unemploy-ment, followed by war.

To avoid a recurrence of these evils,the leaders of the post-World War II pe-riod sought to establish an institutionalframework that would help unwind war-time controls on trade and foreign ex-change transactions and, over time, pro-duce a more open system of commercealong with a more stable system of inter-national payments. In its first two de-cades, the World Bank lent large sums ofmoney to support the rebuilding of Eu-rope and then turned to helping the de-veloping countries. The IMF providedbroad financial and technical support thatenabled many countries to achieve cur-rency stability and to substantially reduceforeign-exchange controls. Balance-of-payments deficits for the most part werereduced without recourse to protection-ism or new exchange controls. And- - -


GATT oversaw a series of multilateralnegotiations to reduce global trade barri-ers. The combined efforts of these threeinstivaons were instrumental in the post-war surge of world trade: world exports,which prior to World War II amounted toroughly $40 billion annually, expanded100-fold in the past 50 years to an esti-mated $4 trillion in 1993.

Currency relationships during theearly postwar period were based on theconcept of fixed-but-adjustable exchangerates; countries set par values for theircurrencies vis-à-vis the U.S. dollar, thecenterpiece of the system. The dollar wasfixed to and convertible into gold at $35per ounce. Currency adjustments wereinfrequent and were only permissible,with IMF approval, in the event of funda-mental disequilibrium (i.e., very largeand persistent trade or current accountimbalances).

End of Bretton Woods systemIn the 1970s, the Bretton Woods systemcollapsed. America abandoned its com-mitment to convert dollars into gold un-der pressures from a sustained U.S. cur-rent account deficit, an unwillingness ofother nations to increase the value oftheir currencies to help the U.S. correctthat deficit, and the growing magnitudeof short-term international capital flows(into and out of stocks and bonds) thatmade fixed rates more difficult, or at !castmore costly, to sustain. These capitalflows have grown in force over the last

5.1

few decades, as households, corporationsand pension funds have accumulatedmore financial resources andthroughbanks and by purchases and sales ofstocks, bonds, real estate, etc.can shifttheir funds across borders with relativeease.

Late in the 1970s, a series of sharp in-creases in the price of oil transferredhuge sums of money to oil-exportingcountries, concentrated in the MiddleEast, and away from large oil-consumingcountries, the most import-dependent ofwhich was Japan. A number of oil-im-porting developing countries in LatinAmerica and other regions were ad-versely affected as well. The financialsystem recycled the "petrodollars," accu-mulated by the tens of billions in SaudiArabia, Kuwait and their neighbors, tocountries whose balance of payments haddeteriorated due to higher oil import bills.Much of this recycling, especially to thedeveloping world, was accomplishedthrough the commercial banking system.

U.S. becomes a debtorThroughout this period the U.S. experi-enced a weakening of its own trade bal-ance. That was due to glowing trade defi-cits with Japan and other industrializedcountries seeking to boost exports ofmanufactured goods to pay their higheroil bills and to America's own elevatedoil import costs. The U.S. had to borrowlarger sums of capital from the rest of theworld, primarily from the chief oil ex-porters, to finance its substantial currentaccount deficit.

In the 1980s, oil prices plummeteddue to rec.;ssion in the industrial Worldand worldwide conservation efforts inreaction to sky-high prices. The tradesurpluses of oil-producing nations didlikewise. Two of the larger oil importersin the industrialized world, Japan andWest Germany, saw a sharp improve-ment in their trade and current accountbalances. In time, benefiting from lower

costs, they piled up substantial tradesurpluses and, with a growing excess ofsavings over investment, became largeexporters of capital to other nations. TheU.S., still accumulating large current ac-count deficits despite a lower oil importbill, was chief among the nations borrow-ing from them. With its trade balanceeroded by a substantial increase in itsbudget deficit and a sharply higher dollarexchange rate, the U.S. lost its status asthe world's largest creditor. Over time its

GLOBAL FINANCE

low rate of savings relative to its largeinvestme .t requirements and growinggovernment budget deficit dramaticallyincreased America's dependence on for-eign capital inflows.

Latin American debt crisisMany developing countries, chiefly inLatin America, having borrowed heavilyin the 1970s, when interest rates wererelatively low, to finance oil-related tradedeficits, experienced serious difficultiesin servicing their debts in the early1980s. This difficulty was caused by twofactors: slower growth in exports to theindustrialized world, much of which wasin recession; and higher world interestrates due to sharply tighter monetarypolicy in the U.S. and other industrializednations aimed at curtailing the inflationthat higher oil prices had brought about.

Commercial banks in the U.S. andother nations suffered from a spate of badloans to Latin American and other for-eign borrowers and to their own domesticborrowers in such sectors as real estate.Their role as international lenders de-clined as loans to many highly indebtedThird World countries came to a virtualhalt, and much of their energy was de-voted to innovative debt rescheduling.Over time, effective cooperation betweenthe major banks, national governments(the U.S. Treasury and its counterparts inFrance, Britain, Germany and Japan) andthe IMF helped debtor countries, led byMexico, to implement effective stabiliza-tion policies to reduce inflation and bal-ance-of-payments deficits and thereby tomanage and overcome the debt crisis.

The IMF during this period came todevote the bulk of its efforts and resourcesto working with developing countries; itshifted away from promoting stability andpolicy changes in industrialized countries,where its help was now less needed. TheWorld Bank provided economic supportto the developing countries and helpedthem to restructure their economies toincrease their efficiency.

Capital demands escalateIn the 1990s the system shifted yet againas the collapse of the Soviet empire, andthe abandonment by many developingcountries of statist economic doctrine, un-leashed a whole new set of demands forinternational capital. A number of devel-oping countries and former Communistcountries sought access to global capitalmarkets. Large amounts of stocks and

bonds were issued by newly privatizedcompanies. Direct investment in factoriesand other enterprises also boomed as theinvestment climate improved. Capitalflows into Asian countries reached $62billion in 1993 compared with roughly$22 billion per year in the late 1980s. InLatin America, capital inflows amountedto $47 billion in 1993 compared with anaverage of roughly $16 billion per year inthe late 1980s.

Significantly reduced short-term inter-est rates in the U.S. improved bank bal-ance sheets; that facilitated banks' effortsto increase domestic and internationallending. Lower interest rates also induced

ABBREVIATIONS

APEC Asia-Pacific Economic CooperationFed Federal Reserve Board0-7 Group of SevenGATT General Agreement on Tariffs and

TradeIUD International Bank for Reconstruc-

tion and Development (World Bank)IDA International Development

AssociationIFC International Finance CorporationIMF International Monetary FundAIDS multilateral development bankAWN most-favored-nation/AM Multilateral Investment Guarantee

AgencyMaffei North American Free Trade

Agreement1400 nongovernmental organizationWM World Trade Organization

U.S. investors to shift investments frombanks into higher yielding mutual fundsin the search for increased returns; mu-tual funds, in turn, shifted a greater pro-portion of their funds abroad, increas-ingly to the developing world, wheregrowth and returns were strong. Banksreentered developing-country markets,but, in contrast to the 1970s and early1980s, a far greater portion of their lend-ing went to private-sector borrowers, incontrast to the heavy lending to sovereigngovernments that characterized the past.

Dollar weakensIn 1993 massive flows of internationalcapital played havoc with attempts byGermany, Britain, Italy and other coun-tries of the European Union (formerly theEuropean Community) to maintain stablecurrency rates among themselves. Earlyin 1994, powerful currency flows also

52

caused a sharp drop in the dollar's ex-change rate against the Japanese yen andthe German mark. The U.S., with itschronic shortfall of domestic savingsrelative to investment, remains theworld's largest importer of capital,largely through sales of bonds and othersecurities to foreign investors.

However, the appetite of foreign pri-vate investors for U.S. financial assetshas deteriorated. In early 1994 foreigncentral banks had to assume a greaterrole in financing the U.S. current accountgap by intervening in currency marketsto purchase American dollars and thenbuying Treasury notes and bills to pre-vent too sharp a decline in the dollar vis-a -vis their countries' currencies. Theweakening dollar has been a major factordiscouraging foreign investors from pur-chasing American securities. Financingthe U.S. deficit has also been made moredifficult by the increased propensity ofJapanese investors to utilize their savingsat home and by eastern Germany's ab-sorption of the formerly large exports ofcapital by the former West Germany.

New playersIn recent years banks have been joined byinsurance companies, pension funds andmutual funds as major players in interna-tional financial markets. In 1968, pensionfunds had assets of roughly $150 billion;today that figure is over $2 trillion. Theassets of mutual funds have also surged;these funds now have about $2 trillion inassetsan amount approaching the sumtotal of bank deposits. Increased institu-tionalization of savings also has occurredin Japan and Western Europe.

Commercial banks have seen their tra-ditional roles diminish in relative terms,even though their assets have increasedin absolute terms, as borrowers soughtalternative means of financing. Volumesand values of capital market transactionshave increased dramatically as domesticfinancial markets have been deregulatedand new types of securities have prolifer-ated. Banks in turn have innovativelymoved to develop capabilities in thesenew areas.

For Americans these changes in worldfinance have created enormous new op-portunities and enormous new risks. Theexpanding global capital market has en-abled a growing number of Americans toplace a larger portion of their savings inoverseas investments. In 1992, Ameri-cans' net purchases of foreign stocks


GLOBAL FINANCE

amounted to over $32 billion, and of for-eign bonds, to over $19 billion. In 1993,seeking higher returns as U.S. interestrates declined, Americans acceleratedtheir acquisitions of foreign securities;net stock purchases shot up to $63 bil-

1 lion. Much of this money was not in-vested by American households directlybut by institutions such as mutual funds,pension funds and insurance companieswhich manage their resources. U.S. mu-tual funds accounted for a significant por-tion of the total. As recently as 1991, 8%of all equity mutual fund inflows wentinto international (non-U.S.) and global(U.S. and non-U.S.) mutual funds; at theend of 1993 roughly 50% of the inflowwent into these two categories.

Through their mutual funds, pensionfunds, insurance policies and direct in- ;

vestment abroad, millions of Americans,who 10 years ago never dreamt of own-ing foreign stocks and bonds, now do soin substantial magnitude. Although this

shift could, and for many did, producehigh returns, it has also meant that largenumbers of Americans are more vulner-able to developments in other parts of theworld. So the President's decision onwhether to renew most-favored-nation(MFN) status for China has had an im-pact on the assets of Americans who di-rectly or indirectly (through mutual orpension funds) invested in China, HongKong, Singapore and Taiwan. And thevolatility of currencies like the yen, Ger-man mark and peso can sharply affect thevalue of the holdings of Americans inJapanese, German and Mexican securi-ties. As The New York Times' Thomas L.Friedman put it prior to the decision: "Asthe Clinton Administration weighswhether to revoke China's preferentialtrade status, and whether to impose tradesanctions on Japan, a new factor is creep-ing into its calculations: What impactwould such moves have on already vola-tile global stock and bond markets?"

The dollar, the Fedand interest rates

THE DOLLAR LINKS Arnett,. 'fns to theworld economy. To appreciate the

nature and complexity of that linkage.that currency's role must be fully under- ;

stood. The dollar is, of course, the instru- ;

ment used to denominate and execute do-mestic transactions in the U.S. But it isalso a major instrument for internationaltransactionsand not just those involv-ing Americans. Sales of goods betweentwo foreign countries are frequently de-nominated in dollars, and most of theworld's commodities (most notably oil)are traded in dollars.

The dollar is also the world's mostimportant reserve currency; virtually ev-ery country's central hank keeps a sub-stantial amount of dollars in its foreignexchange reserves. America's currencyis still the reserve currency of choice formost countries. And of the roughly $360billion of cash dollars in circulation,about $240 billion are held in other coun-tries (about $20 billion in Russia alone).Foreign citizens in many countries seethe dollar as a credible transaction cur-rency and store of valueoften in con-trast to their own domestic currency. It isalso a major investment currency in

50 GRLAT I) P. (' I S I 0 N S Iva 5

which hundreds of billions of bonds is-sued by Americans and non-Americansalike (e.g. in the Eurobond market) aredenominated.

It is the role of the dollar as an invest-ment instrumentin which several tril-lions of dollars worth of securities in theU.S. and around the world are denomi-natedthat is at the root of the major in-ternational flows of that currency. Salesand purchases of the dollar for invest-

! ment purposesshort term and long1 termare far greater than for conducting

international trade. Decisions by inves-tors that affect dollar assetsto buy orsell dollar-denominated stocks, bonds orshort-term Treasury billsare the mostpowerful factor affecting the currency'svalue.

The amount of dollar assets heldabroad has increased dramatically in re-cent years. During an average year in the1980s, the U.S. current account deficitamounted to nearly $100 billion. Afterdipping in 1991 and 1992. that figurerose to $1 10 billion in 1993. The effectof this deficit is that foreigners receivetens of billions of dollars annually. If afamily buys a Mercedes in New York, it

(3

pays in dollars; the distributor in the U.S.puts these dollars in the company bankaccount in New York; the German manu-facturer then has the option of holdingthe dollars in the bank, investing them indollar securities or reinvesting them in itsbusiness in the U.S. Or it can decide tosell the dollars to a person or institutionwho wishes to use them to purchase U.S.goods or securities. If the supply of dol-lars for sale substantially exceeds de-mand, the price will drop; if demand sub-stantially exceeds supply. the price of thecurrency will rise.

U.S. dollar declinesThe cumulative total of U.S. dollar secu-rities that are now held in foreign handshas grown rapidly through repeated an-nual current account deficits and othercapital outflows. If private foreign hold-ers of dollar assets choose to sell thembecause they are no longer attractive (dueto concerns about inflation eroding thevalue of bonds, harsh regulations or taxesundermining corporate profits, a weaken-ing dollar or other factors) or they simplysee better investments at home or in otheroverseas markets, they will place addi-tional dollars on the market. If largenumbers of investors do so, they will sig-nificantly weaken the dollar's foreign ex-change value. The same is true if, on anet basis, foreigners do not use dollarsearned by the sale of goods like steel,cars or coffee to buy dollar-denominatedfinancial assets at prevailing exchangerates.

In early 1994 foreign purchases ofU.S. bonds fell sharply due to a weakdollar and a decline in U.S. bondpricesplus more-attractive investmentopportunities at home. In turn, as thedollar weakened, more foreign investorsshunned dollar assets. Central bankswere forced to intervene in the market,buying large amounts of dollars to pur-chase short-term U.S. Treasury securi-ties. In 1994, a significant portion of theU.S. current account deficit (running atan estimated annual rate of $125 billion)was financed by foreign central banksparticularly by the Bank of Japan. Tothe extent that stronger growth in Japanand Europe increases exports from theU.S., and higher savings in the U.S.induced by higher interest ratesreduceU.S. demand for imported capital, theU.S. current account deficit should de-cline and the acceleration in the offshorestock of dollars should moderate. That

GU3SALFINANCI

in turn could help reduce and reversedownward pressure on the currency.

The value of the dollar is influencednot only by foreign investors' decisionsbut also by decisions of American inves-tors. In the 1980s, Americans bought netroughly $3 billion of foreign stocks and$4.5 billion of foreign bonds annually; in1993 those figures rose to $65 billion and$60 billion respectively. Because Ameri-cans must sell dollars to buy the yen orGerman marks needed to purchase Japa-nese or German financial assets, suchtransactions tend to depress the value crthe currency. The torrid pace of such pur-chases by Americans in 1993 diminishedin the first half of 1994 in the case of somecountries. It was reversed in the case ofothers, particularly in the developingworld where Americans were net sellers,as stock markets experienced sharp drops.Still, the continuing trend toward foreign-asset accumulation, as American institu-tions diversify their investments, can ex-ert a negative influence on the dollar foryears to come. The U.S. is likely to re-main a major net exporter of investmentcapital to other nations, as U.S. investorsseek to internationalize their portfoliosand obtain high returns abroad.

Domestic policy's key roleAll of this underscores ti' compelling

requirement for U.S. authorities to main-tain domestic policies attractive to for-eign and U.S. investors alike. Investmentin plants, equipment, research and train-ing is critical to American employment,growth and productivity. Because of thecurrently very low level of domestic sav-ings and many Americans' increasing in-vestment abroad, the U.S. must relyheavily on capital imports to finance thefederal deficit plus private capital needs.If the flow of foreign investment is inad-equate, long-term interest rates in theU.S. will rise and growth will falter.

The decline of the dollar against theyen in 1993 and early 1994 was seen bymany Americans as healthy because ithelped to increase the price competitive-ness of American goods vis-a-vis Japa-nese goods in world markets. Moreover,there was little evidence that it was con-tributing to higher prices in the U.S., as alower currency value normally tends todo. This was because for most of thisperiod the dollar actually strengthenedagainst most of the world's currencies,particularly those of America's majortrading partners except Japan. In addi-tion, weak demand in Europe and Japanled to underutilization of productioncapacity in these countries; so their enter-prises sought to hold market share in theU.S. by limiting price increases on goods

rtexpoed to this market, even if thatmeant cutting profits to the bone.

The declining dollar has pushed upinterest rates in the U.S. from time to time.Foreign investors are reluctant to investin the financial assets of a country whosecurrency is declining, thereby renderingthemselves vulnerable to currency lossesfrom holding such assets. Investors canonly be convinced to buy or hold suchassets if the return on them justifies the,risk, which means that they seek higherinterest rates to help offset such risks.

The dollar's decline, along with in-creased inflationary expectations and cur-rent and expected increases in short-terminterest rates by the Federal Reserve tosuppress future inflation, has caused long-term interest rates on bonds issued by theU.S. government and U.S. corporations torise. That, among other things, has raisedthe cost to American taxpayers of financ-ing the federal debt. Moreover, the weak-ening of a country's currency over timerenders its citizens poorer, as their cur-rency ultimately will buy less and less onworld markets. Historically the competi-tive benefits of a lower currency tend tobe eroded by the higher capital costs andgreater inflationary pressures that dimin-ish the trade advantages of the lower ex-change rate.

Conversely, countries that see advan-

GLOSSARY

BALANCED GROWTH: Growth which occursin most or all sectors of the economy.

BALANCE Of PAYMENTS: A summary state-ment of all the economic transactions ofa nation with the rest of the world duringa given year. It consists of trade and ser-vices, capital and reserves.

BOND: Written promise to pay a specifiedamount of money, the principal, at a cer-tain future date or periodically over thecourse of the loan during which time in-terest is paid at a fixed rate.

CAPITAL MARKET: Market in which stocks,bonds and other financial instruments aretraded.

CURRENCY STABILITY: The absence of dra-matic fluctuations in the value (exchangerate) of cunency.CURRENT ACCOUNT: Summary of all trans-actions concerning the trade of goods(i.e., imports and exports), services (e.g.,finance charges from banks, shippingcharges), and unilateral transfers (e.g.,foreign aid).

EQUITY: The value of a business property,excluding amounts owed on it (e.g.,mortgages or other liabilities). In themarket, it also refers to a risk interest orownership right in property, such as thecommon stock of a corporation.EXCHANGE RATE: The relative price of anation's currency in terms of those ofother nations.nomuu RESERVE: Central bank of the U.S.The Federal Reserve consists of a Boardof seven Governors and 12 regional Fed-eral Reserve Banks.

INTEREST RATE: The price paid for the useof money. Individuals, businesses andgovernments pay interest to use moneynow (that they do not presently have) un-der the agreement that they will pay theprice for using it (the interest rate).MARKET ECONOMY: Economic systemthat relies on competition, profit incen-tives and the principles of supply anddemand to determine which goods toproduce, how to produce them, the priceat which to sell them, and who willreceive them.

MOST-FAVORED-NATION (MFN): In interna-tional trade agreements, a country grant-ing MFN status to another countrymakes available favorable treatment inregard to tariffs and other trade regula-tions that it accords to most of its othertrading partners.MUTUAL FUND: An investment companythat owns the securities of corporationsand distributes earnings to the fund'sshareholders.

RECESSION: Period of declining economicactivity. Recorded as two consecutivequarters (six months) of negative growth.

SECURMES: Legal documents that estab-lish, represent or evidence a right orrights to property. Refers to a note, bond,option, stock, or evidence of indebted-ness.

TREASURY NOTES AND RILLS: Governmentsecurities issued by the U.S. TreasuryDepartment with a maturity of 1-5 years.Short-term securities (maturing in oneyear) are called billr or certificates andlong -term securities (maturing after fiveor more years) are called bonds.


BEST COPY AVAILABLE 5 4Si

GLOBAL FINANCE

cages in a strong currency do so becauseit suppresses inflationary pressures,attracts low-cost capital and forcesconstant improvements in corporatecompetitiveness.

If the U.S. is to be able to maintain astable currency along with steadily im-proving competitiveness, it will need tosustain a low rate of domestic inflation;continue recent progress in cutting thefederal deficit (thereby freeing up morecapital for private investment); increasedomestic savings; and reduce its largecurrent account deficit. Ways of doingso include improving incentives to putfunds into Individual Retirement Ac-counts and other savings vehicles; re-ducing the level of entitlement paymentsand government subsidies; and cuttingtaxes on capital gains. Such moveswould induce increased savings and pro-ductive investment. More resources in-vested more intelligently in human capi-tal through training and education wouldbetter equip people for a constantlychanging technological and workplaceenvironment.

Role of the FedThe dollar's international role puts anextra responsibility on the Federal Re-serve Board Fed) to control inflation andensure an attractive investment environ-ment. The Fed, which sets short-terminterest rates, is looked to by wage earn-ers and investors to ensure that the valueof their dollars and their other assets isnot eroded by inflation. Inflation under-mines foreign and domestic investor con-fidence in financial assets and thus in acountry's currency.

For a time in the summer of 1994there was a possibility the Fed wouldhave to raise interest rates in the U.S.even more rapidly specifically to attractmore foreign capital to stem a sharp dol-lar drop. Although the dollar eventuallystabilized, taking pressure off of the Fed,the possibility exists that such a situationcould again arise. Complicating such amove would be the question of whether itwould work. The Fed can only set short-term interest rates; if raising short-terminterest rates causes stocks and bonds todecline in value, investors might moveout of dollar securities rather than buythem, thereby pushing the dollar downfurther and putting the Fed in an evendeeper predicament.

International interest rates fell from1989 to 1993 because recession in many

52 GNI' AT I)IICISIONS 1995

industrialized coun-tries led to weak de-mand for the existinginternational pool ofsavings. Japan's cor-porate sector cutback dramatically onits borrowing re-quirements, freeing up capital for export,much of it to the U.S. Now corporationsin the industrialized world and theemerging economies are competing ac-tively for financing. In the face of weaksavings in the U.S. and large governmentdeficits in most of the industrializedworld, these credit demands are exertingan upward push on interest rates. Theemergence of dozens of countries in theformer Communist and developing worldthat have embraced market forces and arecompeting to attract investment addsfurther to the demand for internationalcapital. According to the Institute of In-ternational Finance in Washington, netequity flows from industrialized to devel-oping countries grew from just under $20billion in 1990.to over $80 billion in1993, and total flows of equity and debtcapital rose from $72 billion to over $180billion in the same time period. This hastightened the market for internationalcapital.

Japan, for decades the world's largestsupplier of investment capital, is now us-ing a larger portion of its investmentcapital at home and in East Asia. Thishas had an especially significant impacton U.S. capital markets and the recentlyvolatile yen-dollar relationship. Japaneseinvestors have from time to time shiedaway from the U.S. market because ofconcerns about the weakening dollar,while American investors have periodi-cally sought profits from the strengthen-ing yen and the Japanese stock market.

At the same timehigher governmentdeficits in 1994 inmost other industrial-ized countries (withthe exception of theU.S.) have absorbedsignificant amounts

of private savings that could otherwise beused for private investment.

Projections are for Western govern-ment deficits (while declining signifi-cantly from current levels) to remain highfor several more years, especially inWestern Europe. It is likely that Japan'svery high savings rate has peaked. Andboth direct and equity investment in thedeveloping world, along with foreignborrowing by governments and corpora-tions there, are likely to remain robust.

To be sure, higher interest rates willweed out less profitable investments, thusimposing a natural restraint on demandfor funds. There will also be downwardpressures on wages and business costs, ascorporations seeking new capital attemptto increase profitability. That phenom-enon will be reinforced by the added glo-bal competition in products ranging fromsteel, to cars, to television as a result of theemerging entrants in the global tradingsystemChina, India, Southeast Asia andothers. Their competitiveness on worldmarketsadded to the already intensecompetition among the industrialized de-mocracieswill also limit corporate priceincreases and force cost cutting in oldereconomies, thereby restraining inflation.Intensified competition for capital, juxta-posed with the intensified competition formarkets in goods and services, will com-bine to produce relatively high real inter-est rates (relatively high nominal interestrates with relatively low inflation rates)for several years to come.

811.011AL FINANCE

Global institutionsTHE RAPIDLY EVOLVING global financialenvironment of the mid-1990s is one

in which markets can overpower govern-ments. And international financial institu-tions are less influential with industrial-ized countries, which now need themless. In light of these changes, the IMFand World Bank, now celebrating their50th birthdays, are reassessing their roles.

International Monetary Fund.Floating exchange rates, integrated glo-bal financial markets, the unwillingnessof many governments to lock their cur-rencies into a tight band vis-à-vis one an-other, and a reluctance of countries tosubordinate domestic monetary or fiscalpolicy to international constraints haveweakened the influence of the IMF in theindustrialized world. But by virtue of itsenormous pool of resources, the IMF stillhas great influence in many developingcountries.

However, its record is not withoutcontroversy. Critics of the IMF argue thatit has made balance-of-payments adjust-ment more painful than necessary, doesnot enable countries to regain their eco-nomic health or move to private sourcesof capital quickly enough, and does notpermit a sufficiently long moratorium ondebt repayment. The IMF has sought tocorrect concerns raised by developingand industrialized countries by improv-ing the sensitivity of adjustment pro-grams to social concerns while preserv-ing the programs' overall goal of restor-ing creditworthiness.

The IMF could be a more importantforum for serious policy dialogue amongindustrialized countries and betweenthem and developing economies. Al-though the Group of Seven (G-7) indus-trialized nations (Britain, Canada,France, Germany, Italy, Japan and theU.S.) recently have preferred to utilizetheir own smaller forum for policy coor-dination, they still regard the IMF as acredible institution: they see it as havingplayed an indispensable role in the reso-lution of the Third World debt problemand before that in the smooth recyclingof petrodollars. Currently, they havegiven it a significant role in providingtechnical and financial support to post-

Communist countries in transition tomarket systems to help establish condi-tions for increased private capital flows.

With a larger number of emergingcountries playing a larger role in worldtrade and finance, the key forums withinthe IMF, particularly the high-level In-terim Committee (which includes themajor economies in the industrializedand developing world and often meets atministerial level), can play a broader co-ordinating role. One of the great tasks ofthe 1990s for the Western democracies isto incorporate emerging economies suchas China, Southeast Asia, Latin Americaand formerly Communist Europesmoothly into the global market system.The IMF can be an increasingly usefulinstrument in prcmoting serious policydialogue with these countries to that end.

Strengthening the IMFThe IMF cannot effectively play that rolevis-à-vis emerging economies unless themajor industrialized countries themselvestake it more seriously as a forum for dia-logue and follow its policy advice morefaithfully. Toward this end, the IMFneeds to be accorded a greater role in G-7 deliberations. Its managing director,along with the president of the WorldBank and the director general of the newWorld Trade Organization (successor toGATT), should be invited to meet withthe seven heads of state on the eve oftheir annual summits, Their task wouldbe to focus the deliberations of thesepresidents and heads of state on the cen-tral global economic issues. The 1MF'smanaging director would be able to exerthis influence at a higher level and exposenational leaders to a critique of their poli-cies from an international perspective.That could help to avert large paymentsimbalances among key economies anddistortions within these economies.

To improve the 1MF's credibility asan "objective referee." its managing di-rector could create a group of expertscharged with preparing assessments of,and prescriptions for, the G-7, as pro-posed by Canadian economist WendyDobson. That in turn could pave the waytoward increased currency stability.

The private, independent BrettonWoods Commission's 1994 report,Bretton Woods: Looking to the Future,recommends that the major industrializedcountries "strengthen their fiscal andmonetary policies and achieve greateroverall macroeconomic convergence;and...establish a more formal system ofcoordination, involving firm and crediblecommitments, to support these policy im-provements and avoid excessive ex-change rate misalignments and volatil-ity." It recommends a system that in-volves firm commitments by major in-dustrialized countries "to respond appro-priately to changes in international eco-nomic conditions with adjustments inmacroeconomic policies and with cur-rency intervention." In time "this systemcould possibly involve flexible exchange-rate bands, within which exchange ratescould move without mandating a policyresponse. If so, the system will have todefine government obligations when ex-change rates threaten to breach theboundaries of those bands. And it mustdefine rules for making exchange-rateadjustments, which serve to shift thebands themselves and ensure the neces-sary long-term flexibility of the system."

At the meeting at which the recom-mendations of the Bretton Woods Com-mission were publicly presented, officialsof the U.S., Japan and Germany wereunenthusiastic. For a variety of reasonsthey were reluctant to accept a commit-ment to a global plan under the IMF toinclude their currencies in a new "band."As The (London) Economist noted:"None of themleast of all America,which matters mostis willing to subor-dinate domestic economic policy to inter-national obligations."

Stabilizing currencies in a world inwhich the balance of power betweenglobal financial markets and govern-ments is shifting toward markets is anenormous challenge for finance minis-tries and central banks. This underscoresthe importance of using both the G-7 andthe IMF to improve cooperation on thefundamentals of n- croeconomic policyin order to avoid tajor payments orpolicy distortions.

Among the developing and transform-ing nations of the world, the IMF canplay a more direct role as provider bothof advice to establish credible and sus-tainable macroeconomic and balance-of-payments policies and of financial assis-tance which supports such policies. The


MASA& FINANCE

IMF has learned a lot about the adjust-ment process over the years, and nowpays significant attention to the socialimpact of adjustment, as well as the de-gree of a country's reduction in its debtor inflation rate, recognizing that policiesthat cause excessive amounts of domesticpain or loss of public support areunsu ,tainable over time.

A World Bank-IMF merger?The IMF's role necessarily will overlapwith that of the World Bank, as it didduring the debt crisis of the 1980s. TheIMF is dispensing policy advice toformer Communist countries in the pro-cess of transforming to a market system.The World Bank is doing the same.

Overlaps between these two institu-tions have led to the suggestion that theybe merged. That would be inadvisable.Each has, at its core, a different mission:the IMF's is to focus on macroeconomicand balance-of-payments analysis andprovide broad financial support; theWorld Bank's is to focus on structuraland sectoral matters and provide more-directed financial support. Clearly eachcan provide important input into the deci-sions and programs of the other.

Both institutions also should estab-lish close links with the new WorldTrade Organization (WTO); the IMFcould advance its own objectives as wellas those of the WTO by building strate-gies for trade and investment liberaliza-tion into its broader policy advice forreducing inflation and payments imbal-ances. It should encourage countries toadopt domestic policies that avoid largecurrency misalignments that distorttrade. Frequently, for example, an over-valued currency will lead to a balance-

1 of-trade deficit and thus to excessive useof trade restrictions against other coun-tries, even though the cause of the prob-lem has little to do with the trade policiesof those countries. The World Bankcould also support the WTO by encour-aging trade liberalization in countriesthat receive its aid. The WTO could helpthe World Bank by actively supportingpolicies that promote domestic compe-tition in its review of national tradepolicies.

The World Bank. Few institutions inhistory have had a greater or more posi-tive impact on the peoples of this planetthan the World Bank. It consist; today ofa remarkably talented group of men and

, women who constitute the world's most

54 GREAT DECISIONE 1995

experienced body of experts on economicdevelopment. They have enabled theWorld Bank to evolve over its 50 yearsfrom its initial focus on economic recon-struction after World War II: in its firstloan, in 1947, the World Bank provided$250 million to France to finance vitallyneeded imports of coal, petroleum prod-ucts, steel and railway equipment. Overtime its emphasis has shifted to lendingfor public infrastructure projects through-out the developing world, to providingbroader technical and financial supportfor agriculture and education, to assistingcountries to overcome the debt crisis ofthe 1980s, and to helping nations that I

seek to transform themselves from so-cialist to market economies.

Now the World Bank has mapped outfive challenges posed by the changingrequirements of recipient nations and thenew concerns of major donor nations.The challenges, as outlined in its July1994 report, Learning from the Past,Embracing the Future, provide a frame-work for the future. To be effective inmeeting them, the World Bank will needto establish specific sets of priorities. Be-low are a few observations and sugges-tions relating to each challenge.

First, the World Bank plans to rein-force its already significant level ofsupport for domestic policy reforms thatpromote broad-based growth and reducepoverty. One lesson of the last 50 years isthat the key to sound growth is sounddomestic policy, and that increasedincome distribution cannot be achievedwithout sustained economic growth.Economic assistance from outside donorscan be useful, indeed even vital, butappropriate domestic policy is the deter-minative factor. The World Bank wasinstrumental in helping China to developmarket-oriented reforms that enabled it to

I attract large sums of private capital anduse foreign aid more effectively. TheWorld Bank's ability to promote soundeconomic policies in Russia and formerlyCommunist Europe, as well as in Gazaand Jericho, now seeking to developunder Palestinian authority (see Topic 4),will be an important new test.

A second World Ban!: objective willbe to expand assistance for education,health, nutrition and family planning.Such investments in people are to enablethe poor to participate more effectively inthe development process. Loans in theseareas, which constitute both economicand social contributions to development,

t57

have increased from an average of 5% oftotal World Bank loans in the early 1980sto more than 17% in 1994. Family plan-ning and early childhood health and edu-cation servicescritical deficiencies inmany poor nationsdemand particularattention.

Third, environmentally oriented pro-jects will continue to receive higher pri-ority from the World Bank. A healthyenvironment is increasingly recognizedas a vital economic and human resource.The World Bank's ability to demonstrateconvincingly that it is at the forefront ofthe effort to protect the environment andsupport sustainable development will bea key to future public support in the U.S.and many other Western nations. Manynongovernmental organizations (NGOs)have argued that the World Bank'sefforts in this area have been either lag-ging or inadequate.

Fourth, a major new role for theWorld Bank is that of helping countriesto tap the enormous potential of privateinitiative and entrepreneurship amongtheir people. From Singapore to China toBotswana, private enterprise is a dy-namic new source,of investment, job cre-ation and broadened income distribution.The highly innovative InternationalFinance Corporation (IFC), the memberof the World Bank Group that can makeinvestments directly in private sectorcompanies (the World Bank itself canonly do so on a limited basis, with gov-ernment guarantees), merits significantadditional support by the U.S. and othernations. For every one dollar it invests,the IFC generates seven dollars of privateinvestment. Another member of theWorld Bank Group, the Multilateral In-vestment Guarantee Agency (MIGA),could be more active, if its capital and fi-nancing limits were raised.

One of the World Bank's great finan- '

cial challenges in coming years will be tofacilitate public-private partnerships tochannel investment into productive enter-prises and infrastructure projects in de-veloping and formerly Communist coun-tries. China alone will have to bring on-stream roughly 15,000 megawatt hoursof new electric generating capacity peryear over the rest of this decade. Innova-tive World Bank cofinancing and gu iran-tees for private investors, who now ac-count for $15 billion annually of infra-structure investment in these countries,can be hstrumental in ensuring tla! fi-nancing of important projects. So will the

GLOBAL FINANCE

World Bank's insistence that countriesmanage infrastructure as a business, not abureaucracy, introduce competition toimprove the efficiency of governmentservices, and ensure that users of govern-ment services share responsibility for de-veloping and paying for projects.

Finally, the World Bank plans to helpdeveloping nations improve the effective-ness of their public institutions so theymight better support market economicpolicies. A key priority must be provisionfor legally enforceable contracts andproperty rights; without these, marketcapitalism and emerging entrepreneur-ship cannot long flourish. Here, betterpublic institutions require civil serviceswith greater accountability to the public.The World Bank also needs to train anduse more experts in the Third World and,where possible, give them a greater rolerelative to consultants from the industri-alized nations. The World Bank hasgradually increased the level of local in-volvement in its projects.

The U.S. continues to be the largestcontributor and most influential memberof the World Bank Group. It has recentlyused its influence to encourage the WorldBank and other multilateral developmentbanks, such as the Inter-American, Afri-can, Asian and European developmentbanks, to make significant reforms. Manyof theseemphasizing environmentalsustainability, investment in humanbeings and support for the privatesectorare reflected in the World Bank'snew strategy.

However, the accumulation of U.S.arrearages to multilateral developmentbanks (MDBs) weakens American influ-ence and credibility. As Secretary of theTreasury Lloyd Bentsen stated in testi-mony before the House AppropriationsCommittee: "With every cut in the ap-propriations for the MDB account, thearrearages have become even larger. Thisis an embarrassing situation for our coun-try. Last year I listened closely to yourconcerns about the need to reform the de-velopment banks. I put in place a com-prehensive agenda for change. We weresuccessful in carrying out a large part ofthat agenda. We were persuasive. Wehad influence. Other countries followedour lead. But that won't happen againthis year unless we get full funding forthe multilateral development bank ac-count. That means full funding for thecurrent request and beginning to reducethose arrearages."

Support for development institutionsis endangered by complacency inwealthy nations. So much progress hasbeen made in such areas as South Korea,Southeast Asia and much of LatinAmerica that the existence of intensepoverty in other regions tends to escapethe world's consciousness until it isjolted by television footage of Somalia,Rwanda and Haiti. Yet these are not iso-lated instances. In many areas, agricul-tural systems, health care delivery, infra-structure and the very institutions of gov-ernance are on the verge of collapse; theprospect of a spate of "failed states"looms ever larger. Unless averted, thesedisasters will lead to environmental ca-tastrophes, massive migrations and mili-tary upheavals. These in turn will posedilemmas for the U.S. and other Westernnations: Do they simply ignore theseproblems, or do they intervene for hu-manitarian reasons, to avert massive im-migration into their own territories (withthe attendant xenophobic reaction), or torestore a deposed (or indeed any) govern-ment? Much educational work is stillneeded in the developed nations to rein-force the message that development as-sistance in support of sound domesticpolicies in developing countries can beeffective "preventive medicine" to avertinstability.

U.S. policy optionsJ 1. In a world of highly mobile capi-tal, should the U.S. seek more-institu-tionalized means for stabilizing thedollar's exchange rate?

Yes: Because U.S. intervention in cur-rency markets and increases in U.S. inter-est rates in 1994 produced only mixedresults, the U.S. should propose a more-formal system of "target zones" withinwhich governments would agree to main-tain the values of their currencies.

No: The Administration's approachwas not at fault; rather it did not go farenough. More currency intervention and/or higher domestic interest rates wouldhave produced the desired effect. Alter-natively, in a world of highly mobilecapital, governments can do relativelylittle to stabilize exchange rates; the keyis stable and sound domestic policies andavoidance of large balance-of-paymentsdisequilibria.J 2. Should the Administration edu-cate the public about the need for con-tinued foreign assistance to poorernations?

56

Yes: The U.S. should overcome "do-nor fatigue" and convince the Americanpublic that the small percentage of thefederal budget allocated to foreign assis-tance to Third World countries is bothmoral and a sound economic and foreign-policy investment.

No: The U.S. must conserve its assetsto protect vital interests, not dispense itslargesse to countries that are not takingsignificant steps to help themselves.J 3. Should the U.S. tie its contribu-tions to multilateral developmentbanks to their increasing commitmentto protect the environment?

Yes: Because the environment is I

linked, directly c.. indirectly, to everyfacet of development, the U.S. mustmake environmental protection a condi-tion of its support.

No: Such a policy is too rigid. Someprojects may be very helpful in overcom-ing poverty in a poor country but mayfail to meet environmental standards.J 4. Should the U.S. take the lead inincorporating emerging economiessuch as China, Southeast Asia andLatin America in the global marketeconomy?

Yes: Integrating the emerging econo-mies more closely into the growing inter-national financial market will benefit all.The U.S. should propose steps to im-prove the outreach of the G-7 and makemore effective use of the IMF's InterimCommittee.

No: The U.S. step-by-step approach,based on the development of cooperationamong regional groups, such as the NorthAmerican Free Trade Agreement (Nafta)area and the Asia-Pacific Economic Co-operation (APEC) forum, is preferable.Integrating emerging economies into theglobal economy under U.S. guidance willonly increase resentment from other in-dustrial countries as well as developingcountries.J 5. How can the U.S. reduce its de-pendence on foreign capital?

a. Continue present policy: The U.S.is moving in the right direction by reduc-ing the budget deficit. This is the singlemost effective way to reduce thecountry's dependence on foreign capital.

b. Change present policy: It is vitalto the health of the economy that the U.S.more aggressively reduce the federaldeficit, but it must go beyond this toprovide additional incentives to saversand investors by changes in the taxsystem.

- -GFil-.AT DECISIONS 1995 55

I

1. How have the changes in internationalfinancial markets over the past 20 yearsaffected the U.S. position in the worldeconomy? How have they affected yourpocketbook? Your community andstate's economy?

2. How much of a role should the U.S.

government play in protecting Americanforeign investments?

3. What steps can the U.S. governmenttake to raise the rate of savings and lowerthe balance-of-payments deficit, therebyreducing the country's dependence onforeign capital?

4. What steps could the U.S. take to bemore competitive globally? How mightyour community contribute to thisendeavor?

5. In recent years, the value of the dollar

has plummeted in relation to the Japa-nese yen and the German mark, weaken-ing the buying power of Americans in theworld market. What should the U.S. doto reduce the volatility of currencies?

6. How can the industrialized democra-cies more effectively incorporate emerg-ing markets such as China, SoutheastAsia and Latin America into the globaleconomy?

7. What goals should the multilateral de-velopment banks emphasize? Eradicatingpoverty? Preserving the environment?

A I

311111116

Bretton Woods: Looking to the Future. Washington, D.C.,Bretton Woods Commission, July 1994. 322 pp. $35.00 ($25.00for nonprofit organizations). The Bretton Woods Commission,a private independent group, recommends reform of the IMFand a refocusing of development assistance by the World Bank.

Gwin, Catherine, Banking on the Future: U.S. Support forthe MDBs. Washington, D.C., Overseas Development Council,May 1994. 12 pp. $2.00. An analysis of the relationship be-tween the U.S. and the multilateral development banks and rec-ommended changes to increase their effectiveness.

Haas, Peter M., et al., eds., Institutions for the Earth. Cam-bridge, Mass., MIT Press, 1993. 340 pp. $15.95 (paper). Sevenenvironmental problems are analyzed to determine the role ofinternational institutions in protecting the environment.

Hormats, Robert D., "Reforming the International MonetarySystem: From Roosevelt to Reagan." Headline Series No. 281.New York, Foreign Policy Association, 1987. 80 pp. $5.95. Acritique of the "aws in the international monetary system, alongwith proposals for its improvement.

Kenen, Peter B., ed., The International Monetary System:Highlights from Fifty Years of Princeton's Essays in Inter-national Finance. Boulder, Colo., Westview Press, 1993. 405pp. $68.50. Twelve essays by influential economists illustratethe international monetary problems and policies.

Learning From the Past, Embracing the Future. WaL -ing-ton, D.C., The World Bank Group, July 1994. 32 pp. Free. TheWorld Bank is changing rapidly to help reduce poverty and se-cure sustainable development.

Rowen, Hobart, Self-Inflicted Wounds: From LBJ's Gunsand Butter to Reagan's Voodoo Economics. New York,Times Books/Random House, 1994. 447 pp. $25.00. Washing-ton Post columnist's critical judgment on events and personali-ties that have shaped America's economy.

L _


Volcker, Paul, and Gyohten, Toyoo, Changing Fortunes: TheWorld's Money and the Threat to American Leadership.New York, Times Books/Random House, 1992. 394 pp.$25.00. Two leading economists present a historical survey ofthe global monetary order.

BUREAU OF ECONOMIC ANALYSIS, Commerce Department, Inter-national Economics, 1441 L St., N.W., Washington, D.C.20230; (202) 606-9900.w Offers the User's Guide, a listing ofall material and information available from the bureau, free.

ECONOMIC STRATEGY INSTITUTE (ES!), 1.100 Connecticut Ave.,N.W., Suite 1300, Washington, D.C. 20036; (202) 728-0993.

Guided by the belie that the next century will he the age of"geo-economics," ESI conducts research, hosts conferences andseminars, and publishes books and articles on U.S. trade andinternational economic policy.

INSTITUTE FOR INTERNATIONAL ECONOMICS (11E), 11 Dupont Circle,N.W., Suite 620, Washington, D.C. 20036; (202) 328-9000.

IIE is a private nonprofit, nonpartisan, research institution forthe study and discussion of international economic policy. Theinstitute publishes studies, basic references and classroom textsfor college students.

NATIONAL COUNCIL ON ECONOMIC EDUCATION, 1140 Avenue ofthe Americas, New York, N.Y. 10036; (212) 730-7007. a Thecouncil sponsors Economics America, a comprehensive educa-tional program that provides teacher training and materials forelementary and secondary school students. It is affiliated with anetwork of state councils and university centers. To locate yourstate council, request the Directory of Affiliated Councils andCenters.

U.S. CHAMBER OF COMMERCE, 1615 H St., N.W., Washington,D.C. 20062-2000; (202) 463-5460. a Helps shape legislativepolicies on trade issues and offers publications to assist U.S.companies in competing around the globe. To order, contact theInternational Division/Publications.

U.S. INTERNATIONAL TRADE COMMISSION (US1TC), 500 E St., S.W.,Rm. 1 12 -E, Washington, D.C. 20436; Public Affairs: (202)205-1819. g Established by Congress, Usitc is an independent,bipartisan, quasi-judicial agency that collects public- andprivate-sector views on international trade issues.

J

OPINION BALLOTSHow to use the Opinion Ballots: For your convenience, there are two copies of each opinion ballot. Please cut out and mail oneballot per person only. To have your vote counted, please mail ballots by June 30, 1995. Send ballots to:

FOREIGN POLICY ASSOCIATION, 729 SEVENTH AVENUE, NEW YORK, N.Y. 10019Ditagestmmtai Ell IN MI MI UZI ID MI 5111 CH MI MI MI Iliii IIIMI VM Et iia MI CO IM! MI in co -2 n Ei E'1 C.:I L.---f. CL71

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El yol,s 0ti 5 Global Finance 0El

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ISSUE A. Regarding issues of global finance, the U.S. 00 should: r]: should:El YES NO pn

1 . Seek a return to the system of fixed BrO exchange rates. 00 E2. Reduce its dependence on foreign8 capital.0

Global Finance

ISSUE A. Regarding issues of global finance, the U.S.

YES NO

1. Seek a return to the system of fixedexchange rates. [I;

2. Reduce its dependence on foreigncapital.

3. Take the lead in incorporatingemerging market economies intothe global economy.


U

Utc:t


U

3. Take the lead in incorporatingemerging market economies intothe global economy.



Date: / /1995 Ballot continues on reverse side... Date: / /1995 Ballot continues on reverse side...

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China, Taiwan,Hong Kong

ISSUE A. With regard to overall policy toward China, theU.S. should (choose one):

1. Let China determine its own future without interfer-ence from the U.S.

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3. Continue the policy of "constructive engagement."

4. Other, or cornment

2. Pressure China to accept international standards ontrade, human rights and nuclear proliferation.

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ISSUE A. With regard to overall policy toward China, theU.S. should (choose one):

1. Let China determine its own future without interfer-ence from the U.S.

[..7 2. Pressure China to accept international standards ontrade, human rights and nuclear proliferation.

3. Continue the policy of "constructive engagement."




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OPINION BALLOTS.

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ISSUE B. In making contributions to multilateral devel-opment banks, the U.S. should place a higher priority on(choose one):

1. Protecting the environment in developingcountries.

2. Eradicating poverty in developing countries.


ISSUE C. How important is it to you that the U.S. take thefollowing steps?

VERY SOMEWHAT NOT VERY

IMPORTANT IMPORTANT IMPORTANT

1. Increase its savings rate.

2. Reduce its balance-of-

3.

111 4

payments deficit.

Make investing in theU.S. economy moreattractive to foreigners.

Continue foreignassistance todeveloping countries.

IIIII 1. Protecting the environment in developing1 countries. II 2. Eradicating poverty in developing countries.

II

111

3. Other, or comment IV IIN II ISSUE C. How important is it to you that the U.S. take the1 following steps? II VERY SOMEWHAT NOT VERY I

IMPORTANT IMPORTANT IMPORTANT wi

II 1. Increase its savings rate. II 2. Reduce its balance-of- I1

payments deficit. 0 II 3. Make investing in the I

U.S. economy moreattractive to foreigners.

i 4. Continue foreign IN assistance to II developing countries. 0 I

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ISSUE B. Concerning relations between China, Taiwan Iand Hong Kong, the U.S. should (choose one): I

I 1. Support more autonomy for Hong Kong and a Igreater international role for Taiwan.

a Ii 2. Leave it to Hong Kong and Taiwan to work out I

their own relations with China. I1 3. Other, or comment V

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ISSUE B. In making contributions to multilateral deve'-opment banks, the U.S. should place a higher priority(choose one):

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10 Ei IN I II I 2. Encourage China to enter into Isecurity agreements with other Asian1 0 nations and the U.S. I

2 3. Encourage more trade with China. 111 MI IV I 4. Other, or comment I

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ISSUE B. Concerning relations between China, Taiwanand Hong Kong, the U.S. should (choose one):

1. Support more autonomy for Hong Kong and agreater international role for Taiwan.

2. Leave it to Hong Kong and Taiwan to work outtheir own relations with China.


ISSUE C. In response to China's military buildup, the U.S.should:

1. Maintain a strong military presencein Asia.

YES NO

I. Maintain a strong military presencein Asia.

2. Encourage China to enter intosecurity agreements with other Asiannations and the U.S.

3. Encourage more trade with China.


6.1

China, Taiwan,Hong Kong:U.S. challengesHow should the U.S. respond to the emergence of a new,vigorous China, one of the most dynamic, rapidly growingeconomies in the world, and its two prospering neighbors?

by Joseph R. Gregory

DENG )(MOPING (right), with his favored successor, Communist party Secretary General JiangZemin (center), and Li Peng, China's premier. Potential challengers to Jiang are waiting in thewings.

ON OCTOBER 1, 1994, with fire-works and fanfare, the leaders ofthe Chinese Communist party

(CCP) marked the 45th anniversary ofthe founding of the People's Republic ofChina (PRC). The week-long celebrationended with an evening finale inTiananmen Square, where, five years ear-lier, troops of the People's LiberationArmy (PLA) had shot down demonstra-tors protesting the political repression,corruption and nepotism of the regime.This time, the square was cordoned offby thousands of soldiers and police. Onlypeople of proven fidelity to the partyware permitted to take part.

The most powerful man in China was-

not present. Deng Xiaoping, who turned90 in August, is said to be blind, nearlydeaf and suffering from Parkinson's dis-ease. In recent years his public appear-ances have grown increasingly rare. In-deed, the four-day secret meeting of theCCP Central Committee plenumthegathering of party leaders that precededthe celebrationwas said to have beentaken up largely with the question of whowould succeed Deng as China's para-mount leader.

Deng's successors will guide nearly1.2 billion people in Chinathe mostpopulous nation on earthinto the 21stcentury. They will also grapple withcomplex economic and political ques-

tions. In the teeth of rising social turmoil,they must decide whether to accelerate orslow the pace of reform in the world'sfastest-growing economy. They mustcome to terms with China's uneasyneighbors, troubled by its growing mili-tary power and hunger for acceptance inthe world community. And they must re-solve quarrels with Taiwan and HongKongtwo economic powerhouses thatmay provide models for the futuregrowth of Greater China. (The termrefers to the three Chinese economiesChina, Hong Kong and Taiwan.)

The decisions taken by China's nextleaders will have major implications forU.S. policymakers and the businesscommunity as well as ordinary Ameri-cans. A prosperous, free-market Chinacould benefit all its neighbors, Americantraders and the world community atlarge. But an economically powerful,militarily aggressive power could desta-bilize world politics and threaten long-term U.S. interests.

In the years since Tiananmen Square,the U.S. debate on China policy has fo-cused on human-rights issues. But Sino-American relations embrace a wholerange of economic and security ques-tions. What can the U.S. do to encourageChina to improve its human-rights per-formance and follow the path toward de-mocracy being taken by Hong Kong andTaiwan? How can China be further inte-grated into the international economicsystem in a way that serves its need foreconomic development and also benefitsthe other countries that trade with and in-vest in it? And what can the U.S. do toencourage Chinese cooperation in resolv-ing security conflicts in East Asia and inworking with the international commu-nity to prevent the proliferation of weap-ons of mass destruction?

Predicting the weatherNapoleon once called China a "sleepinggiant" that would, when wakened, causethe world to tremble. The vision of a sin-ister, resurgent China was one of theworst nightmares of the cold war. Yet theprospect of China imploding into anarchyis equally disturbing. The last time thecentral government crumbled, with thefall of the Qing Dynasty in 1911, decadesof anarchy and war followed, culminat-ing with the Communist takeover led by

JOSEPH R. GREGORY, a former senior editor ofthe Foreign Policy Association, has writtenabout and traveled extensively in the Far East.


Mao Zedong in 1949. He led China untilhis death in 1976.

Deng may well be replaced by anothermember of the old guard of Communistrevolutionaries who came to power withMao. In the short term, it is almost cer-tain that party leaders will continue toguide China's political destiny. But manyanalysts see Deng's approaching death asthe end of an era.

"What will China be like in the year2000?" asks Nicholas D. Kristof, writingin The New York Times shortly after fin-ishing a five-year stint as the newspaper'sbureau chief in Beijing, the nation's capi-tal. "Predicting its course even a yearfrom now is like forecasting next year'sweather."

After Deng, who?The list of possible successors is too longand too theoretical to name and it in-cludes many dark horses. China's com-paratively young president, the 68-year-old Jiang Zemin, has been designated asDeng's successor: But as he maneuversto consolidate power, other leaders fromacross the party's ideological rainbow arejockeying for position.

Like President Jiang, Zhu Rongji, the66-year-old former mayor of the greattrading city of Shanghai, tends to be astrong supporter of economic reform andof opening China to the outside world.Other contenders are more conservative.Qiao Shi, the 70-year-old head of theNational People's Congress, has the back-ing of some reformers but also has strongties to conservatives and members of thePLA, who value his background inChina's intelligence and security services.Li Peng, the 66-year-old premier, is alsosaid to have strong support among con-servatives, who fear that economic reformat too fast a pace will fuel social unrestand weaken the party's hold on power.

Party elders with behind-the-scenesinfluence may tilt the balance one way orthe other. These include people like ZhaoZiyang, 75, a supporter of democraticreforms, who lost his post as party chiefafter the Tiananmen Square crackdown.Another is Yang Shangkun, an 86-year-old former president, who backed Deng'sreforms but also supported the 1989crackdown. Yang lost his post as thehead of the Central Military Commissionin 1992 and was demoted along with hishalf brother, Yang Baibing. 74, appar-ently because Deng felt they mightthreaten his power.

. --- - -60 GREAT DECISIONS lvu5

CHINA, TAIWAN, HONG KONG

The capitalist road

Since 1979, Deng has led his nation downthe road to market-based economic devel-opment by letting market forces determinemost prices, loosening state controls onindustry, allowing private enterprise, andopening the door to foreign investment.

Deng reversed the Maoist policy offorcing farmers to work on huge collec-tive farms and allowed peasants to havelong-term leases on farmland and sellmost of what they produce. Under hisrule, grain production has improved andper capita income has risen in the coun-trysidewhere nearly four fifths of allChinese live. Moreover, Deng hasopened a great swath of China's coast toforeign capital by creating special eco-nomic zones, from the island of Hainanin the southeast through Guangdongprovince, adjacent to Hong Kong, and onto Fujian province, opposite Taiwan. Inthese areas, Chinese entrepreneurs areallowed to go into business with foreigninvestors with only limited state interfer-ence. Perhaps more important, Beijinghas acquiesced to the demands of provin-cial and local authorities for a muchgreater say in economic matters. For ex-ample, the central government has maderevenue-sharing agreements that allowprovincial governments to retain taxearnings generated by private develop-ment projects and other kinds of enter-prises. For the first time, local officialshave been allowed to benefit from theprofits from production in their regions.

These measures have paid off hand-somely. Each year for the past 13,China's economic growth rate has ex-ceeded 9%, according to estimates com-piled by the U.S. Central IntelligenceAgency. Rapid economic growth hasvastly improved the lives of a great manyChineseparticularly those who live inthe special economic zones. The WorldBank reported in a study published in1993 that the proportion of Chinese liv-ing without decent food, housing andclothing dropped from 220 million in1980 to 100 million in 1990. In 1994,China was considered the world's llth-largest trading power and the fastest-growing economy. By the year 2002, ac-cording to World Bank estimates,Greater China is projected to have agross domestic product of $9.8 trillion,compared with $9.7 trillion for the U.S.By 2010, it is expected to be the world'slargest economy.

3

However, economic statistics com-piled by the PRC are often regarded asunreliable and some experts contest theseeconomic forecasts as too optimistic. Inhis book China in the World Economy,Nicholas R. Lardy, a professor of interna-tional studies at the University of Wash-ington, maintains that China's world eco-nomic leadership is a long way off. Henotes, for example, that the country's percapita income is only about $1,000about 1/20th that of the U.S. Even atChina's present rate of growth, he says,the country's per capita income will notreach American levels for 150 years.China, he notes, is one of the world'slargest debtor nations, exporting inexpen-sive products like toys and garments andimporting expensive technological andindustrial equipment. Although it is thelargest recipient of foreign direct invest-ment among developing nations, it main-tains extensive quotas and barriers to im-ports, a major complaint of Americancompanies that do business there.

Fear of the 'Polish disease'Economic reform has also let loose a hostof social and political problems. Ram-pant inflation hurts millions of people liv-ing on fixed incomes. State industriesthat once guaranteed an "iron ricebowl"housing, health care, pensionsand other benefitsare breaking downunder the new, competitive system. Un-employment is rising as some 10 millionto 20 million young Chinese enter the jobmarket every year.

Labor unrest is also growing, posing afundamental challenge to the legitimacyof the Communist partythe so-calledparty of the working class. Since the1980s, China's leaders have feared the"Polish disease"reform that wouldspark the kind of workers' revoltlaunched by the Solidarity movement inPoland that led to the demise of the Com-munist government. They also watchedthe last years of the Soviet Union, in1990-91, with anguish as Gorbachev'sreforms led to the breakup of the empire.

Many Chinese party leaders felt thatcommunism unraveled there because So-viet leaders failed to take care of thepeople. They see Deng's reform measuresas a means to fuel economic growth, pro-vide for the Chinese people, maintain so-cial stabilityand safeguard their ownpolitical legitimacy. Even afterTiananmen Square, Deng argued thatChina's reform movement must continue.


Nevertheless, Beijing has delayed themost difficult reformclosing state fac-tories and trimming surplus workers.Beijing keeps many loss-making state in-dustries in operation with infusions ofcapital, fueling inflation. It also providescostly benefits to 70% of China's 147million nonfarm workers.

Every year, 14 million moreA soaring population and what some ana-lysts fear are growing strains on the abil-ity of the Chinese to feed themselves addto concerns about the future. China isprojected to add 490 million people inthe four decades from 1990 to 2030,swelling the population to close to 1.7billion. At the same time it is losing a ris-ing proportion of its agricultural lands tothe ravages of pollution and to manufac-turing, among other uses. Approximately130 million rural Chinese have migratedto cities in search of better lives. Manyfind work in the new, independent facto-ries, laboring under conditions reminis-cent of the worst aspects of the 19th cen-tury Industrial Revolution in the West. Inthe next decade, millions more are ex-pected to leave the countryside, stokingthe pressure cooker of discontent.

Rapid change has also brought risingcrime and fueled both regional rivalriesand political corruption. As Beijing givesthe provinces mc,.2 leeway to control for-eign-investment projects, levy taxes andconduct their own affairs, political au-thority grows more diffuse and difficultfor the government to exercise. Beijinghas been slow to build the legal and eco-nomic institutions necessary to supportfree markets. Local bureaucrats createred tape to extort bribes or divert re-sources to their own projects. Although

china is rich in natural resources, has ahardworking population and access toforeign investment, its policies are oftenself-defeating. Its trade regulations, forexample, have been criticized as incon-sistent, based on protectionism and over-regulation.

China is also fraying along the edges.Muslims in the autonomous region ofXinjiang Uygur grow increasingly frac-tious; in Tibet, subdued by China in theearly 1950s, agitation for political free-dom has been rising since the late 1980s,and, despite Chinese crackdowns, thesituation there remains tense. China isengaged in border disputes with almostevery one of its neighbors, from Vietnamto Russia. From across the South China

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Sea, Japan watches warily as China de-velops a leaner, more robust military.From across the Pacific, the U.S. lookson with concern at some of Beijing's ex-ports of missiles and nuclear technology.

Post-Deng scenariosMany China-watchers predict that themonths after Deng's death will extend aperiod of collective leadership under hischosen successors. While this may accel-erate a trend toward democracy, it mightalso bring about a backlash in the form ofa nationalist military state or the frag-mentation of the state, with the power ofregional leaders growing at the expenseof the central government. Of course,none of these scenarios is hard and fast;China at the turn of the 20th centurymight experience a combination of allthree. Indeed, Deng himself favored dif-ferent policies at different times. When itwas politically and economically expedi-ent, he permitted market liberalization.When political demonstrations got out ofhand in 1989, he approved a crackdown.

The following three scenarios areoffered more as possibilities than aspredictions:

The Status Quo: The party remainsin charge but economic liberalization and

BEST COPY AVAILABLE 6 4

integration with the international commu-nity continue at the current pace. In theshort term, political authoritarianism re-mains strong, but the base for democraticreform expands with prosperity, much thesame as it did in Taiwan, where decadesof dictatorial rule and political repressionare now giving way to such reform. Un-der this scenario, a prosperous middleclass can gradually emerge from under thethumb of an oppressive state to demanddemocratic reform. Such a change mayoccur in piecemeal fashion, with China'smore prosperous coastal provinceswiththeir greater access to foreign trade andthe influence of Hong Kong andTaiwanleading the way.

The Nationalist Military State:The PRC is currently a Communist coun-try in the sense that most political powerlies in the hands of the party hierarchy.Order is reinforced by the PLA, whichitself controls many business, army andparamilitary organizations. The PLA re-ceives income from arms sales, transpor-tation networks, factories and farms. Itmakes everything from kitchen appli-ances to civilian clothes. Its influence isextensive, and any would-be leader mustwin its support.

Some China-watchers envision a new

GREAT I) I, CISIONS 1445 61

CHINA, TAIWAN/HONG KONG

authoritarianisman alliance of Com-munists and military and industrial lead-ers that would deliver prosperity to theelite and varying degrees of comfort tosupporters down the social and economicscale. Under the banner of nationalismand unity, almost everyone would be pro-vided for. But dissenters would becrushed with methods just as fierce asthose employed by Mao.

Under this scenario, China might useits economic wealth to create a strongermilitary machine not only to rule at homebut also to project power overseas. Thiswould fulfill China's goal of a centuryto restore the nation's wealth and power.

e A Fragmenting China: China isfar more decentralized today than it was10 or even 5 years ago. The growth ofprovincial protectionism, economic ex-haustion or the failure to maintain a highlevel of economic growth could lead tothe fragmentation of China, with differ-ent parts of the country taking differentpaths. Such splits could lead to anarchyin some areas and even civil war as dif-ferent regions and factions grapple forcontrol. Under the Communists, Chinahas hung together for 45 years as a singlestate after bloody regional fighting fromthe 1920s through the 1940s. Today, adecentralized, fragmented China couldface the same risk of creating problemsbeyond the country's borders if politicalchaos and economic instability cause amass exodus of refugees. On the otherhand, a new federalism may evolve, inwhich China builds the political and eco-nomic institutions necessary for runninga complex, integrated modern economy.

There is a fourth possible scenario,namely a resurgence of hard-line Com-munists, but many analysts consider itunlikely. The so-called Maoist factionmaintains that Deng's reforms have be-trayed the values and achievements ofsocialism through "money worship."Communism, these alleged leftists say,succeeded in bringing order to a countryravaged by imperialism and economicchaos. Deng and his "capitalist roaders"allowed economic exploitation in the

CCP

GMT

MIN

PtA

PRC

ABBREVIATIONS

Chinese Communist party

General Agreement on Tariffsand Trade

most - favored - nation

People's Liberation Army

People's Republic of China

name of progress. The demonstrations inTiananmen Square were not so much acall for democracy as a protest againstcorruption and inequality. While no ideo-logical heir has emerged to replace Mao,it is possible that political upheaval andan economic collapse could feed a callfor a return to the relative stability of the

past. However, if the hard-liners did re-turn to power, it is unclear what stepsthey might take. They might, for ex-ample, move to limit personal freedomand put greater state control on theeconomy, including sharp limitations onprivate enterprise and a return to collec-tive farming.

62 GREAT DECISIONS 199$

Greater ChinaTODAY, AFTER MORE than four decadesof mutual enmity and distrust, the

PRC, the island of Taiwan and the Brit-ish colony of Hong Kong have developeda symbiotic relationship. If all the com-mercial intercourse of the mainland, Tai-wan and Hong Kong were considered asa single economic unit, the powerhouseknown as Greater China would beAmerica's third-largest trading partner,after Canada and Japan, supplantingMexico.

Interdependence and distrustThe interdependence of trade is great.Taiwan, through vigorous export and in-vestment policies, has built up $90 bil-lion in foreign-exchange reservesmorecash on hand, according to The WallStreet Journal, than any other govern-ment except Japan. Taiwan providesChina with investment capital, manufac-turing technology and management expe-rience. Hong Kong does the same, serv-ing as a conduit for foreign investment inChina. In return, the mainland Chineseprovide inexpensive labor and a poten-tially huge market for all kinds of goods.China cannot continue to grow withoutaccess to outside markets and foreigncapital. More than four fifths of total in-vestment in China comes from over-seasmostly through Hong Kong andTaiwan.

Well over half of Hong Kong's manu-facturers now make their products inplants along the Pearl River in China'sGuangdong province. And Taiwanesecompanies are reported to have investedroughly $20 billion in mainland factoriesand real estate.

Despite this symbiotic relationship,Beijing's distrust of Hong Kong and Tai-wan remains strong, and it is repaid inkind. The island of Hong Kong became aBritish colony in the 19th century. Brit-ain leased the New Territories adjacent to

65

Hong Kong on the mainland in 1898."Fragrant Harbor"in translationquickly became a symbol of Westerncommercial and imperial power. To theChinese, however, it became a symbol offoreign domination.

Yet when the Communists triumphedin 1949, chasing the army of the Nation-alist leader Chiang Kai-shek off themainland to the province of Taiwan, theydid not move against Hong Kong. Hun-dreds of thousands of refugees pouredinto the colony. Some were Chinese ofthe merchant class from the great tradingcenters of Shanghai and Canton, nowknown as Guangzhou; others were peas-ants and laborers. Many of these refugeeshad strong ties to the West and familiar-ity with Western ways of doing business.They added their skills to the nucleus ofbusiness talent already in Hong Kong.Today the colony is a prosperous me-tropolis of 6 million people.

The new Communist government leftHong Kong alone for several reasons.Beijing needed a conduit to the West.Hong Kong became the door throughwhich foreign remittances and goodsflowed into China as Hong Kong Chinesesent money and goods to relatives acrossthe border. Beijing also used the citymuch as the Soviet Union used Berlin, asa meeting ground to exchange informa-tion and goods.

With Britain's lease to the New Terri-tories due to expire in 1997, Britain de-cided in the early 1980s to return all ofHong Kong to China. In 1984, Londonreached an agreement with Beijing underwhich sovereignty over the territorywould be restored to China. Under theformula of "one country and two sys-tems," much of Hong Kong's political,economic and social structure would bepreserved for 50 years. Beijing agreedthat Hong Kong would become a SpecialAdministrative Region after 1997, au-

CHINA, TAIWAN. HONG KONG

tonomous except in defense and foreignaffairs. In effect, this permits the formercolony to retain its capitalist system eventhough it will be under the sovereignty ofa Communist state.

But problems soon arose. The jointdeclaration issued by the two countriessuggested that Hong Kong would have ademocratic political system with guaran-tees of civic and political rights. But asthat political system was defined by Chinain the Basic Law of 1990, the promises ofdemocratic government seemed to be lesssubstantial than had been expected. In theturmoil following the massacre atTiananmen Square, Beijing was much lessamenable to allowing full representativegovernment because it feared that a demo-cratic Hong Kong might influence poli-tics on the mainland and become a basefor subversion in China.

In 1992 Christopher Patten, the Brit-ish governor of Hong Kong, proposedreforms to strengthen representative gov-ernment in Hong Kong. The proposalswould raise the number of people eligibleto vote to 2.7 million from 200,000. Thereforms also called for a change in thecomposition of the Legislative Council toincrease the number of elected membersand representatives of business, profes-sional and labor organizations at the ex-pense of government appointees. The re-forms were passed in June 1994. Whilethey will hardly turn the colony into ademocracy, they may strengthen HongKong's position once it reverts to China.

Beijing officials vigorously opposethe reforms and have warned that theywill dismiss the legislature once they takepower. Such ominous rumbling has fu-eled a debate in Hong Kong, where manyin the business community, wary of an-tagonizing China, oppose the governorand are seeking a more accommodatingstance with Beijing. Others distrust Chinacompletely. Many people have been vot-ing with their feet, emigrating from thecolony at the rate of 60,000 a year since1989. Some have left for the U.S.,Canada or other nations either perma-nently or long enough to establish resi-dency before returning.

Many people, including much of theU.S. business community, which claimsabout $7 billion in investments and $18billion in two-way trade with HongKong, take an optimistic view of thecolony's future. They are basically gam-bling that China will not kill the goosethat lays the golden eggs. They see Hong

A

Kong's fate tied inextricably to the rest ofChina. If political and economic freedomcontinue to take hold, the colony's futureis assured. If not, the fate of Hong Kongis up in the air, regardless of Beijing's50-year guarantee.

The U.S. has no responsibility for re-lations between Hong Kong and China,but it does have significant interests. In1992, Congress passed the U.S.-HongKong Policy Act, whereby the U.S. willcontinue to treat Hong Kong as a sepa-rate entity in the areas in which Chinapermits it to act autonomously. WhileWashington can do little directly to en-sure that the Chinese keep their word,America's stake in Hong Kong's futureis part of its broader interest in promotinghuman rights, democracy and continuedliberalization of trade in the region.

TaiwanU.S. relations with Taiwan are deeper andmore complex than those with HongKong. Taiwan's emergence as an eco-nomic power with diplomatic ambitionsis relatively recent. In the mid-19th cen-tury, the island, 100 miles from the main-land, was a province of China. From 1895to 1945 it was the Japanese colony ofFormosa. Beijing still considers it a prov-ince. The PRC requires all countries withwhich it has diplomatic relations to ac-knowledge its claim that Taiwan remainspart of China, and it has warned that anydeclaration of independence by Taiwanmight result in military action. Thisgreatly complicates U.S. diplomacy withboth nations.

At the end of World War II, Washing-ton faced no such ambiguity. AfterChiang Kai-shek's defeat in the civil war,

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WOMAN OVA FAR EASTERN ECONCAIJC ItESTEW 1-ONG KONG

the U.S. stood behind the Republic ofChina, using its influence to make Tai-wan the sole representative of the Chinese people in the United Nations. WhLthe Korean War broke out in 1950, theU.S. bolstered Taiwan with economicand military support, and the two nationssigned a mutual defense treaty in 1954.But Chiang Kai-shek was a frustratingally, suspicious of democracy and dis-trustful of the U.S. During World War II,he used American military aid to solidifyhis position against the Red Army ratherthan aggressively attack the Japanese. In1947, Nationalist troops holding Taiwancrushed a wave of protest against theirrule. Scholars estimate that some 8,000people, mostly native Taiwanese, wereslain. After Chiang and 2 million of hisfollowers fled to the island where theyrelocated the Republic of China, theywere ruthless in asserting power over theTaiwanese. Over the next three decades,dissidents were murdered or imprisoned,elections were rigged, and the press andthe schools were rigidly controlled.

While the Communists on the main-land were experimenting with the collec-tivization of agriculture and a centralizedeconomy, Taiwan followed the path ofauthoritarian capitalism. Like South Ko-rea and Singapore, Taiwan combinedsingle-party rule with state control ofproduction. Its economy boomed. Today,the country of 21 million people has theworld's 14th-largest economy. Its percapita income is just over $11,000. com-pared to roughly $1,000 for China. Withprosperity came a rising middle class ofprofessionalsbusiness. labor and aca-demicwho gradually built their ownindependent bases of power.


IS TAIWAN

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TAIWANESE PROUST the arrival of a delegation from the PRC. nnposition DemocraticProgressive party favors a new constitution to establish the Republic of Taiwan as anindependent country.

When Chiang Kai-shek died in 1975,he was succeeded by his son, ChiangChing-kuo, who allowed political reformbut not enough to threaten the dominanceof the ruling party, the Kuomintang. Hedied in 1988 and was succeeded by LeeTeng-hui, the current president, who is anative Taiwanese. Since then, Taiwan hasmoved more quickly toward political andeconomic liberalization. Today, all politi-cal prisoners have been freed, and thereare multiparty elections for a representa-tive government. The press is no longercensored and criticism of the regime ispermitted. Political corruption, however,is rampant. The main opposition, theDemocratic Progressive party, wants anew constitution to establish the Repub-lic of Taiwan as an independent country.The National Assembly is in the processof amending the constitution to providefor the first direct presidential elections,which are expected to take place in 1996.

As Taiwan has become more demo-cratic, support for statehood has grownmuch to Beijing's displeasure.Kuomintang leaders feel the ruling partyhas to take steps to demonstrate that it isresponding to these aspirations, and itdoes so by pushing for a greater interna-tional role for Taiwan. This in turn makesBeijing suspicious that the Kuomintang,too, is becoming pro-independence.

Unlike Hong Kong, Taiwan is not onthe road to formal unity with China. Ithas economic ties with more than 100 na-tions and diplomatic relations with over


two dozen others. The more Taiwan isable to operate as an independent, pros-perous democracy, the less likely it is torejoin China. Taiwan's government hasalso made it clear that once Hong Kongreverts to China, its commercial contactswith the former colony will continue.

A place among nationsSince taking office, President Lee hasfought to reduce Taiwan's isolation. In1993 and again in September 1994, Tai-wan made a bid to have the UN, which itwas forced to leave in 1971 when the PRCwas admitted to occupy the China seat,consider the "exceptional" status of the"Republic of China on Taiwan." But onlya handful of member nations supported themove; most did not want to open a "two-China" debate, and the measure did notmake it to the General Assembly again.

In recent years, the PRC and Taiwanhave been driven by mutual economicinterests to seek better relations. Chinahas proposed that Taiwan follow HongKong's route of "one country and twosystems." It could retain its present politi-cal and economic system, maintain aseparate army and enjoy other preroga-tives of an independent state.

To placate Beijing, President Lee in1991 declared that the civil war betweenthe Communists and the Kuomintang hadended and Taiwan ceased to claim sover-eignty over the mainland. Moreover,President Lee says Taiwan does not seekto become a new nation. "The ultimate

6

goal of the Republic of China is unifica-tion," he told The Wall Street Journal inan interview in October. "But until con-ditions become more mature, we won'ttalk. If the Chinese Communists continueto behave like they do, then the people ofTaiwan will be apprehensive." He addedthat it is not likely that the two canreunify until China "is free and demo-cratic and the people of the mainlandenjoy prosperity."

Throughout 1994, relations betweenTaiwan and China seemed to thaw,freeze up and then thaw again. In the1980s, Beijing's relaxation of a ban ontourists from Taiwan suggested that rela-tions were improving. Then, last March,some 24 Taiwanese tourists were among32 people killed in a suspicious fireaboard a boat on Qiandao Lake in south-eastern China. Three bandits were caughtand executed by China. But Taiwan sus-pected that Beijing was trying to coverup a murderous robbery by renegade po-licemen or members of the PLA. The in-cident fueled the call for independence inTaiwan. It also caused officials in Taipei,Taiwan's capital, to delay but not haltnegotiations to improve ties with Beijing.

In August, Taiwan and China agreedin principle on measures to end a seriesof airline hijackings by Chinese seekingrefuge in Taiwan. This was the first timeBeijing had agreed to recognize Taiwan-ese authority to determine who amongthe 16 hijackers involved in 12 incidentswould be treated as political refugees andwho would be returned to China. Otheragreements have also loosened some re-strictions. For example, Taiwanese banksare now to be allowed to conduct somedirect business with China, and both gov-ernments may set up direct transportationlinks across the Taiwan Strait. Neverthe-less, many Taiwanese do not wish to bepart of China while the Communists re-main in power. Others are committed tothe idea of Taiwan as a separate nation.

One China, or two?Beijing's insistence that there is only oneChina has complicated U.S. relations withTaiwan ever since President Richard M.Nixon first sought rapprochement with theCommunists in the early 1970s. At thattime, the U.S. was seeking the PRC's sup-port in containing an expansionist SovietUniona prospect that worried Beijingas much as Washington. After PresidentNixon visited Beijing in 1971, Sino-American relations began to improve


markedly, much to the consternation ofTaiwan. In order to establish full diplo-matic relations with Beijing, PresidentJimmy Carter agreed to end formal tieswith Taiwan in 1978: the mutual defensetreaty was terminated, and U.S. troopswere withdrawn from the island.

While the normalization of U.S. rela-tions with the PRC was generally ap-plauded in America, some conservativesargued that U.S. interests lay in favoringTaiwan over Beijing. Relations with Tai-wan continue on an unofficial basisthrough the American Institute in Tai-wan. The U.S. also continued to sell mili-tary equipment, and in 1992 Washingtonagreed to let Taiwan purchase 150 F-16fightersover Beijing's objections.

Commercial relations are thriving. In1993, Taiwan was America's sixth-largest trading partner, buying $16 billionworth of U.S. productsnearly twice as

much as China buys from the U.S. Tai-wan continues to enjoy strong supportfrom many congressmen, who see it asan important friend in the region. Al-though the president of Taiwan has notbeen allowed to meet formally with thePresident of the U.S. since 1979, severalsenators have called on the Clinton Ad-ministration to allow President Lee tocome to the U.S., even though Beijing islikely to object.

The Clinton Administration says itwill maintain the "one China" policy. Atthe same time, it wants to keep the linesopen to Taiwan. In the fall of 1994, toBeijing's displeasure, Washington an-nounced that it was raising the diplomaticlevel of trade negotiations with Taiwan.A major reason for the change was an ef-fort to keep America's commercial com-petitors in Europe from gaining advan-tage in the Taiwan market.

China and AmericaTHE EARLY 1990s have been a time ofconfusion in international affairs.

With the end of the cold war, the U.S.has lost what had been for almost 45years the sharp focus of its foreignpolicythe battle against communism.Only a few Communist regimes sur-viveChina, Cuba, North Korea andVietnamand they are no longer menac-ing exporters of revolution but anachro-nisms in a fast-changing, increasingly in-terdependent world. Even the PRC, thelast great Communist state, has evolvedinto a political system that Kristof hascharacterized as Market-Leninismamarket economy controlled by a Com-munist central government. How to dealwith this government, which promotesfree markets but continues to violate hu-man rights, has become the central issueof the debate on U.S.-China policy. Thisdebate, born of a clash betweenAmerica's economic and security inter-ests on the one hand and its self-image asthe world's leading advocate of demo-cratic values, centers on one basic ques-tion: How should the U.S. weigh thesesometimes competing interests?

American frustrations with Chinahave been seething since the crackdownin Tiananmen Square, which came at atime when many China-watchers hoped

that economic liberalization would bringa corresponding rise in political freedom.The massacre crushed those hopes. Todemonstrate American anger, PresidentGeorge Bush ordered the suspension ofall military sales to China, stopped thecommercial export of Chinese weaponsto the U.S., and withdrew American sup-port in multilateral development banksfor loans to China, except for basic hu-man needs. All except the ban on mili-tary sales were subsequently removed.

MFN and human rightsThe President's critics, including presi-dential candidate Bill Clinton, chargedthat Bush's policy did not go far enough.They called for the U.S. to put pressureon China by tying most-favored-nation(MFN) trade statusthe right to receivethe standard low U.S. tariffs on importedgoodsto greater respect for humanrights. In 1991 and 1992, Congresspassed legislation that would havegreatly increased tariffs on imports fromChina if Beijing failed to stop human-rights abuses, reduce arms sales and endunfair trading practices. President Bushvetoed the legislation.

President Bush characterized his policyas one of constructive engagement. Heargued that keeping the lines of commu-

66

nication to Beijing open would aid thedevelopment of political freedom in Chinaand lead to inevitable improvement inhuman rights. The Bush Administration'sdefenders argued that American interestsgo beyond the human-rights problem toan array of complicated issues. The U.S.needs to work with China to combat grow-ing environmental pollution; it needsBeijing's influence in dealing with anunstable North Korea; and it must reachan accord with Beijing to stop or limitChina's export of weapons, which in-cludes the sale of nuclear and missile tech-nology and feeds regional instability.

During the 1992 presidential race,Clinton attacked his rival's position. Hecalled for a tougher approach towardBeijing, pledging to link MFN to humanrights, and excoriated Bush for doing"business as usual with those who mur-dered freedom in Tiananmen Square."The U.S., he said, "has a higher purposethan to coddle dictators."

In May 1993, four months after takingoffice, President Clinton threatened towithdraw MFN if China did not meet hishuman-rights conditions by June 1 994. Asthe deadline approached it became clearthat the Chinesehistorically resentful ofWestern intervention in their internal af-fairswould not bend. Secretary of StateWarren Christopher, in a visit to China inMarch 1994, held meetings with govern-ment officials that both sides later de-scribed as frigid. Moreover, in a sign thatthe Clinton Administration's policy wasbackfiring, near the time of Mr.Christopher's trip the Chinese govern-ment ordered the arrests of prominent dis-sidents, although most were later released.(Some analysts attribute the hard linetaken by the Chinese to the possibility thatthey were already involved in a succes-sion struggle and that each faction felt thatgranting concessions to the U.S. wouldopen it to attack by its rivals.)

Meanwhile, pressure mounted fromAmerican business groups to extendMFN status. Chinese exports to the U.S.now total roughly $30 billion a year. TheU.S. sells about $9 billion worth of goodseach year to China, and it is estimatedthat 150,000 American jobs are tied toChina trade. On May 26, 1994, PresidentClinton announced that he would renewChina's MFN status.

"Faced with a choice betwe,m disrupt-ing the vast American economic relation-ship with China or eating a little crow onhis human -rights promises," wrote Tho-

.


!limas L. Friedman, diplomatic correspon-


dent of The New York Times, "Mr.Clinton chose crow."

Other analysts felt that the growingpossibility that North Korea was devel-oping nuclear weapons also played a ma-jor part in Mr. Clinton's decision. Chinais an ally of North Korea and Washing-ton needed Beijing's cooperation in at-

: tempting to resolve the problem. As oneof the five members of the UN SecurityCouncil, China's approval was necessaryto apply sanctions to North Korea.

President Clinton defended his deci-sion: "To those who argue that in view ofChina's human-rights abuses we shouldrevoke MFN status, let me ask you thesame question that I have asked myself:Will we do more to advance the cause ofhuman rights if China is isolated or if ournations are engaged in a growing web ofpolitical and economic cooperation andcontacts?"

To some, President Clinton's decisionwas a vindication of President Bush'spolicy. To organizations like HumanRights Watch it was a betrayal. Thegroup charged that the Clinton Adminis-tration was "effectively removing allpressure on China to improve its human-rights practices."

Keeping up the pressureDespite the lack of success in tying tradeto progress on human rights, someChina-watchers maintain that the U.S.can still take steps to recover its credibil-ity on the issue. For example, a bill wasintroduced in Congress in 1994 thatwould establish a code of conduct forAmerican companies doing business inChina and Tibet that was modeledroughly on the Sullivan Principles thatwere adopted voluntarily by manyAmerican companies doing business inSouth Africa during the apartheid era.The bill would have U.S. companies op-erating in China protect their employees'

' freedom of expression and assembly inthe workplace.

Other features of the code might in-clude adherence to minimum labor Stan-

, dards, noncooperation with surveillanceof employees' political activities and aprohibition against dealing with supplierswho use prison labor. Moreover, the U.S.could link progress on rights to other ar-eas in the U.S-China relationship. Wash-

: ington argues that Beijing's desire forgreater acceptance in the world economymakes it susceptible to Western pressure.

66 G R E A r D I: CISI () N S 19 9 5

Lardy maintains, for example, that, givenChina's desire to join the World TradeOrganization, the successor to the Gen-eral Agreement on Tariffs and Trade(GATT) that is to come into being at thebeginning of 1995, the U.S. should beginlinking the granting of MFN status not toimprovements on human rights but toChina's adherence to rules of fair trade.

Weapons of mass destructionMany China-watchers argue that deepen-ing China's integration into the worldeconomy will also help solve anotherworrisome issueits military buildup andthe sale of military and nuclear technol-ogy. Most analysts agree that China doesnot pose a direct military threat to the U.S.,but there is disagreement as to whether itposes a potential threat to U.S. interestsin Asia. Some fear that a political strugglewithin China could lead to civil war andchaos that could spill over the border; oth-ers fear a military-backed expansion;others say such fears are exaggerated.

Since 1989, Beijing has been upgrad-ing China's military capabilities, using itseconomic boom to finance the buildup.Before that, defense spending had beendeclining. The U.S. Arms Control andDisarmament Agency estimated that in1989 the Chinese military budget was25% less than it had been in 1979. Everyyear for the last five years, it is reportedto have risen by 10%, and it may havereached $7.4 billion in 1993. But thesestatistics may be unreliable. Some analystssay the actual spending may be higher.

The Chinese say that they are modern-izing their antiquated military, and theypoint out that Indonesia, Malaysia andother nations in the region also are upgrad-ing their forces. In comparison with West-ern forces, China's military capabilitiesare weak. According to a report compiledby the Congressional Research Service,the army lacks the means to move troopsquickly. Its fleet of 100 submarines hasthe world's highest rate of fatal accidents.Many date from the World War II era andare not seaworthy. China's 5,000-war-plane air force suffers from poor mainte-nance and unreliable air-fueling methodsthat severely restrict the range of its fight-ers and bombers. In terms of militarystrength, the report says that China iscloser to a Third World country tike Iraqbefore the Persian Gulf war of 1991: itsforces are large, but no match for the ad-vanced technology of the U.S.

However, China remains a potential

threat to its neighbors. For example,China and Vietnam both claim islands inthe Paracel and Spratly chains that sup-posedly lie over rich oil deposits underthe South China Sea. In 1974, Chineseforces took control of several Paracel Is-lands, and in 1988 China seized six of theSpratly Islands. It also has border dis-putes with India, with which it fought awar in 1962. More skirmishes along theSino-Indian border were reported in 1986and 1987.

China has also fueled the arms racebetween India and Pakistan, both of whichhave or are near to having nuclear weap-ons. U.S. officials say there is overwhelm-ing evidence that Cnina sold Pakistan thetechnology for M-11 missiles, which cancarry nuclear warheads over a range of300 miles. Moreover, in the fall of 1994,China resumed underground nuclear testsof a new generation of ballistic-missilewarheads. India considers itself a poten-tial target, and it has used China's contin-ued nuclear testing as justification for itsown nuclear-weapons program. AlthoughChina is said to rank third or fourth amongnations in terms of the explosive yield ofits nuclear weaponsbehind the U.S. andRussia, and roughly equivalent toFranceChinese delivery systemsremain relatively backward.

U.S. military presenceMany observers are more concerned thata power struggle in Beijing may result ina new, militarily aggressive leadership.China's growing military power feeds thearguments of those who maintain that theU.S. should continue to keep a militarypresence in Asia. During the cold war,hundreds of thousands of American troopswere deployed in Japan, South Korea andelsewhere in the region. With the end ofthe cold war, the U.S. has been reducingits forces in Asia, as it has in WesternEurope. Pentagon planners currently callfor the U.S. to keep about 100,000 troopsin the region, mainly in Japan and SouthKorea. Proponents of the current planningmaintain that this policy sends a messageto Japan, South Korea and Taiwan that theU.S. will continue to promote peace andstability in the region.

While few argue that the U.S. shouldwithdraw totally from Asia, some ana-lysts think Washington should emphasizeeconomic pressure in its dealings withChina. Beijing has a considerable eco-nomic interest in avoiding war with itsneighbors. Access to markets in the U.S.,


where China sells a third of its exports, isan important weapon, as is China's ac-cess to the advanced technology of theWest. The U.S. can work with other na-tions to stem the flow of advanced tech-nology to China. At the same time, it canuse its influence to help China move to-ward membership in the World TradeOrganization and other associations tohelp wean it from its isolated past.

U.S. policy optionsWhile the course of China's future is un-clear, few people doubt that an economi-cally more powerful, militarily strongerChina is emerging as the 21st centurydawns. The basic issue facing Americansis how the U.S. chooses to deal with aGreater China in the sense of a morepowerful nation with close ties to HongKong and Taiwan. What policies shouldthe U.S. follow to bring China into thecommunity of nations? How can it en-courage the next generation of Chineseleaders to participate in arms-controlmeasures and organizations to enhanceregional security? To what extent doesthe U.S. expect China to live up to globalstandards on human rights? Followingare four principal policy issues andoptions for each.J 1. U.S. overall policy toward China.

a. The U.S. must be primarily con-cerned with acting in its own economicand security interests and leave China'sfuture to the Chinese. China is a develop-ing country that needs time to work itsway into the family of nations and estab-lish its own pace for abiding by interna-tional norms on trade, security and hu-man rights.

b. Washington should use its interna-tional influence and economic clout topressure China's leaders to accept inter-national norms on trade, se".nrity and hu-man rights. Washington 'ust keep inmind that the situation in China maychange quickly and must remain activelyengaged to help move China in the rightdirection.

c. The U.S. must stake out a moderateposition between these two views, con-tinuing the strategy of constructive en-gagement embraced by both PresidentBush and President Clinton. Acting tooaggressively will feed fears on the part ofsome Chinese that the U.S. is attemptingto undermine Beijing. Being too reticentwill result in missed opportunities.J 2. Response to China's rising mili-tary power.

N

CHINA'S MILITARY BUDGET has been growing by 10% a year since 1989. Experts disagreewhether the PRC is merely modernizing i's antiquated forces or is preparing to project China'spower. Above, torpedo boats patrol the South China Sea.

a. The best way to contain the Chi-nese military is to maintain a U.S. mili-tary presence in Asia and to retainAmerica's place as the world's majornuclear power. The U.S. should encour-age Japan, South Korea, Taiwan andother friends to remain strong militarily.

b. The U.S. has never been in a stron-ger position to promote peace. It can dothis by working multilaterally to reducethe proliferation of weapons of mass de-struction. It must keep in mind that Chinaremains greatly dependent upon U.S. in-vestment, trade and technology. Theseremain by far the strongest tools for in-fluencing China's future.J 3. Policy toward Greater China.

a. Washington should actively supportmore autonomy for Hong Kong and agreater international role for Taiwan. Tai-wan is already partially recognized as anation in its own right and remains a firmfriend. In the long-term, U.S. support forTaiwan will encourage Beijing to followit on the path to democratic reform.

b. The U.S. should leave the peoplesof Hong Kong and Taiwan to work outtheir own futuresit is not a matter ofreal U.S. interest. Washington must dealpragmatically, acting to protect its busi-ness interests in both places while avoid-ing complicating relations with Beijing.

c. Where it can, the U.S. should work

7

to encourage movement in the directionof American values, but not make this acondition of U.S. relations.

4. Role of trade and human rights.a. The U.S. must and can take a stron-

ger stance on human rights. China hasmade it clear that it seeks greater accep-tance in the world economy but it contin-ues to abuse human rights and violateGATT rules on fair trade. Although thethreat of withholding MFN has provedineffective, there are other, more power-ful levers for influencing Beijing. For ex-ample, the U.S. should condition China'smembership in the World Trade Organi-zation on greater efforts by Beijing tostop human-rights abuses. Americashould work with its allies to withholdthe sale of advanced technology andother goods the Chinese need to put pres-sure on China to conform to internationaltrade and human-rights standards.

b. It is a mistake to see Sino-Ameri-can relations solely in terms of humanrights. America's fundamental interestsare best served by a policy that deals withChina on an issue-to-issue basis. Failuresin one sphere should not undermine theentire rela.tionship between the two na-tions. This means that trade issues shouldnot be tied to human rights. The best wayof ensuring that human-rights abuses endis to work for an open China.

GREAT DECISIONS I995 67


P O\

1. Human rights remain an importantconcern in U.S. relations with China.What can the U.S. do to encourage Chinato curb abuses? Should Washington onceagain tie rights to trade, or should it con-tinue to separate the two issues? Howshould the U.S. weigh these sometimescompeting interests?

2. China continues to test nuclear weap-ons and sell advanced nuclear and weap-ons technology overseas. What can theU.S. do to encourage Chinese coopera-

tion in preventing the proliferation ofweapons of mass destruction and resolv-ing security conflicts in East Asia?

3. China is seeking membership in theWorld Trade Organization, yet many na-tions say that it does not follow rules out-lined under GATT. How can the PRC befurther integrated into the internationaleconomic system in a way that serves itsneed for economic development and alsobenefits the other countries that trade andinvest in China?

4. China's growing military power stirs adebate in the U.S. about whether to con-tinue to keep a strong military presencein Asia to promote regional stability. Doyou think a continued display of Ameri-

014

"China: Boom or Bust?" World Press Review, July 1994, pp.8-16. Differing views on China from newspapers and periodi-cals from around the world.

China, 1994. Current History, September 1994. The entire is-sue is devoted to Beijing's relations with the U.S., humanrights, and cultural, political and economic issues in China andTaiwan.

Christopher, Warren, "America and the Asian-Pacific Future."U.S. Department of State Dispatch, May 30, 1994, pp. 348-50. The U.S. secretary of state outlines the ClintonAdministration's policy toward China and its neighbors in anaddress to the Asia Society in New York City on May 27, 1994.

"The Emergence of 'Greater China': Implications for theUnited States." National Committee China Policy Series, No.5, October 1992. 25 pp. A report on a project of the NationalCommittee on U.S.-China Relations, Inc., with the support ofthe Henry Luce Foundation.

Harding, Harry, "Asia Policy to the Brink." Foreign Policy,Fall 1994, pp. 57-74. A specialist in Asian affairs at the ForeignPolicy Studies Program of the Brookings Institution casts acritical eye at the Clinton Administration's handling of U.S.interests in Asia.

Kristof, Nicholas D., and Wu Dunn. Sheryl, China Wakes: TheStruggle for the Soul of a Rising Power. New York, TimesBooks/Random House, 1994. 480 pp. $25.00. The authors, amarried couple. record their experiences as correspondents forThe New York Times in China from 1988 to 1993.

Lardy, Nicholas R., China and the World Economy. Wash-ington, D.C., Institute for International Economics, 1994. 160

_ .


can military might in Asia is necessary?

5. How should Washington respond toTaiwan's desire for a broader interna-tional role without undermining U.S. re-lations with China?

6. How should the U.S. deal with GreaterChina? What approach, for example,should Washington take toward HongKong after it reverts to Chinese rule?

7. In the past, Sino-American relationshave been couched mainly in terms ofhuman rights. Obviously, there is a widerange of issues between the two countries.Do you feel that politicians and the presshave adequately conveyed the complex-ity of American relations with China?

pp. $16.95. The author challenges several common perceptionsof China's economic future and offers ideas on how to help endthe country's political and economic isolation.

THE ASIA /PACIFIC RESEARCH CENTER, Stanford University, Rm.200, Encina Hall, Stanford, Calif. 94305-6055; (415) 723-9741.

A research and training institute, the center has a number ofoutreach programs geared to businesses with an interest in Asia.

ASIA SOCIETY, 725 Park Ave., New York, N.Y. 10021; (212)288-6400. Sponsors study missions, conferences and publicprograms and publishes annual briefings and media backgroundpapers on Asia. For teachers the society offers multimedia cur-ricular materials, training workshops and a national resourcecenter on Asia.

THE CLAREMONT INSTITUTE, 250 West 1st St., Suite 330,Claremont, Calif. 91711; (909) 621-6825. The Asian StudiesCenter of the Claremont Institute for the Study of Statesman-ship and Political Philosophy is a conservative research organi-zation that publishes books, reports and studies.

EAST ASIAN INSTITUTE, Columbia University, 420 West 118th St.,New York, N.Y. 10027; (212) 854-2592. The East AsianCurriculum Project works with secondary and elementaryteachers, providing workshops, classroom materials, guides andconsultation on curriculum, audiovisual aids, textbooks andtravel opportunities.

EAST-WEST CENTER, 1777 East-West Rd., Honolulu, Hawaii96848; (808) 944-7111.. A major research institution foundedby the U.S. Congress that focuses on economic, social, cultural,political and environmental issues affecting the Pacific rim.

NATIONAL COMMITTEE ON U.S.-CHINA RELATIONS, 777 UnitedNations Plaza, New York, N.Y. 10017; (212) 922-1385.. Thecommittee is a public nonprofit organization that encouragesunderstanding of China and the U.S. among citizens of bothcountries. Involved in exchange, educational and policy activi-ties dealing with a wide range of issues with respect to thePeople's Republic of China, Hong Kong and Taiwan.

71

Immigration: anend to open doors?Political oppression, war and poverty uproot people andcompel them to seek a new life. While migration itself iscenturies old, the growing magnitude and awareness of it, andthe wide-scale resistance to it, are new

By Karen M. Rohan

SAN DIEGO, CAUF.: Tighter border controls have slowed illegal immigration at a few points. Afenceand the Border Patrolblock a family's passage. However, access to the U.S. is stilleasy. Motorists on 1-5 in south San Diego are cautioned to watch out for immigrants on the run.

HAITIANS AND CUBANS in makeshiftboats drown at sea trying toreach Florida. Smuggled Chi-

nese drown off the New York coast whentheir freighter, Golden venture, hits asand bar. After dark, Mexicans cross theRio Grande into Texas. These images ontelevision in recent years have contrib-uted to a growing awarenessand wari-nessof immigration in the U.S. !nmany states it was an election-year issue.Although the most-publicized coveragefocuses on the plight of refugees or ille-gal immigrants, public perception oftendoes not differentiate between refugees,illegal aliens and legal immigrants.

Other countries face similar pressurefrom rising immigration. The breakup ofthe Soviet Union caused millions to mi-grate west, especially to Germany. Thewar in former Yugoslavia and economic

hardship in other parts of Eastern Europehave contributed to the tide of immi-grants. Fear of Islamic extremists andeconomic difficulties in Algeria andEgypt have driven thousands of NorthAfricans to the Mediterranean countriesof Europe. Mainland Chinese head forHong Kong, some to stay there, others topush on to the U.S. Russia faces its ownmigration crisis, as ethnic Russians arrivefrom other former Soviet republics. Iraddition, tens of thousands of Africansand Asians, who had hoped to use Russiaas a conduit to third countries, have beenmarooned there since the dissolution ofthe Soviet empire. They don't have themoney to go back home and are unwel-come in other countries. According toU.S. News and World Report, nine coun-tries experienced an exodus of 50,000 ormore people in 1983; by 1992, the

( 4

7number of countries had increased to 31.

What makes an emigrant choose onecountry over another? A variety of fac-tors influence the decision: ease of get-ting in, proximity, job opportunities,existence of a community from theemigrant's hometown or country. Oil-producing countries have drawn migrantlabor from the Middle East and Asiasince the 1960s. The newly industrializedeconomies of East and Southeast Asiaattract labor from poorer Asian countries.South Africb's economy pulls peoplefrom all over southern Africa. Europe isthe destination for many North Africans.The U.S. is the magnet for immigrantsfrom Central America and the Caribbean,and Brazil and Venezuela also attractmigrants from other parts of LatinAmerica. Movement from Eastern Eu-rope and the former Soviet Union toWestern Europe and North America hasbecome a concern since the fall of theBerlin Wall and the dissolution of theSoviet empire.

The relatively low cost of travel todaymakes it possible for more people to mi-grate further than in the past. Recipientcountries have responded by trying tolimit immigration or tighten their bordersin an attempt to protect either their stan-dard of living, their ethnic makeup, theirpolitical stability, or all of these.

How should the U.S. control illegalimmigration? Does legal immigrationpose a problem? Is walling a country offfrom migrants possible? Is it the answer?Or does the solution lie in addressing the"push" factors that cause people to leavehome? The following pages examinesome of the ways other countries are deal-ing with immigration, how the U.S. itselfhas handled immigrants, legal and illegal,and the choices Americans face in deter-mining future immigration policy.

People on the moveMigration both internal and internationalis driven by many forces, including theconsequences of rapid populationgrowth, war, environmental scarcities,political oppression and economic hard-ship. Many of the displaced have fledfrom rural areas to the burgeoning citiesof the Third World and from there toother countries. The exodus includessome of the most motivated citizens,which can exacerbate economic declinein an area. According to the UN HighKAREN M. ROHAN is a senior editor of the I

Foreign Policy Association.


MIAVORATION

Commissioner for Refugees, in 1994there were 20 million refugees in theworld and another 20 million personsdisplaced in their own countries. Morethan 100 million people worldwide haveimmigrated to countries of which theyare not citizens.

Ironically, as the "push" factorsthepressures to migratehave increased, theoptions available to migrants havedwindled. As long as their economieswere thriving, the recipient countrieswelcomed immigrants. Now, facing theirown overcrowding and economicslumps, and needing fewer and fewer un-skilled workers, these countries see im-migrants as a burden and a threat to theirsecurity and well-being. This has contrib-uted to an atmosphere of growing crisis.

A person has a right to leave a coun-try, under international law, but there isno reciprocal right to enter another coun-try. The power to permit or deny entry isrecognized as a right of sovereignty.Most countries have provisions to admitrefugees, generally defined as those flee-ing political persecution whose liveswould be threatened if forced to return totheir home country. But many countriesmake a distinction between political andeconomic refugees: they admit only theformer, even though economic privationcan be as life-threatening as politicalpersecution.

Stemming the flowMany believe that if the rate of popula-tion growth in Third World countrieswere reduced significantly, migrationwould decline. But the impact of lowerbirthrates will not be felt for years tocome. In the meantime, poor countrieshave little incentive to stop emigration: iteases the pressure for jobs, housing andeducation, and they count on the remit-tances of their emigrants to provide amuch-needed infusion of capital. Accord-ing to the UN Population Fund, remit-tances amount to $60 billion to $70 bil-lion a year for underdeveloped countries.They are second only to oil in valueamong international flows.

Improving conditions in Third Worldcountries, most experts agree, is criticalto reducing pressures to migrate. Withoutslower population growth and an expan-sion of economies and jobs, the gap be-tween rich and poor can only continue togrow, leading to increasing political, eco-nomic and social discontent. In 1960, thetop 20% of the world population had 30


times the wealth of the bottom 20%. To-day the top 20% has 150 times the wealthof the bottom 20%.

EuropeAnti-immigration sentiments are explod-ing all over Western Europe, even incountries known for their tolerance, suchas Holland and Sweden. Extreme-rightanti-immigration political parties are thebeneficiaries of this growing xenophobia.In Belgium, anti-immigration partiesmade significant gains in local elections.In Austria's legislative election in Octo-ber 1994, the far-right Freedom partywon nearly 23% of the vote, 6 percentagepoints up from its showing in the 1990election. The party's leader, Jorg Haider,plans to create a Ross Perot-style "Citi-zens' Alliance '98," which he hopes willbring him to power by 1998. He haspromised that if he becomes chancellor,he will expel all illegal immigrants andunemployed foreigners.

The immigration problem is particu-larly acute in Germany. After World WarII, West Germany adopted a liberal asy-lum policy: those claiming political asy-lum received a stipend and housing untiltheir claims could be substantiated,which could take years. It also offeredcitizenship to ethnic Germans in the hopeof luring defectors from Communist EastGermany.

Until the early 1980s, few people tookadvantage of the liberal laws, mainly be-cause of tight border controls by Com-munist-bloc countries. Then the numberof asylum-seekers and job-seekers gradu-ally began to grow. With the tearingdown of the Berlin Wall in 1989 and thecollapse of the Soviet Union in 1991,asylum-seekers and ethnic Germans fromthe East poured into the newly reunitedGermany, exacerbating unemploymentand housing shortages and causing ananti-immigrant backlash. Since Ger-many's reunification in 1990, at least 30people have been killed by neo-Nazis,often in firebomb attacks.

Foreigners, especially non-Europeanimmigrants, many of whom have been inGermany for decades, have borne thebrunt of the resentment and violence.There are over 6.5 million permanent for-eign residents in Germanyincluding1.8 million Turksrepresenting 8% ofthe population. This makes Germany oneof the most ethnically diverse countriesin Europe, where foreign residents makeup 4% of the population as a whole. (In

(J

the U.S., the foreign-born represented 8%of the population in 1990.)

The largest body of immigrants areTurks, who came in the 1960s and 1970sas gastarbeiters (guest workers) to filljobs few Germans wanted. Now, many ofthese workers, whose children speakGerman as a first language and who havenever lived anywhere else, want to beaccepted as German. But under Germanlaw, one of the criteria for becoming anaturalized citizen is that the applicantmust renounce any other national alle-giance. Most Turks are reluctant to dothis and have lobbied for dual citizen-ship. Giving up their Turkish citizenshipwould mean abandoning rights to inherit-ance or to owning property in Turkey.

Left-leaning parties in Germany haveproposed changing nationality laws: theSocial Democrats (SPD) would makeanyone born in Germany a citizen (as inthe U.S.); the Green party supports dualnationality. The ruling right-wingChristian Democratic Union (CDU),which narrowly won elections in Octo-ber 1994, instead has proposed a lim-ited form of citizenship for children ofimmigrants resident in Germany for atleast 10 years, providing at least oneparent was born in Germany. The chil-dren would have full rights until the ageof 18, when they could become full Ger-man citizens if they renounce their othernationality.

In 1993, Germany tightened its asy-lum law. (An asylee is already in thecountry and seeks protected status; arefugee is outside the country seekingadmission.) Under the new law, no onearriving from a "safe third state"all ofGermany's neighbors have been declaredsafe by Bonnis eligible for asylum.Although the number of asylum applica-tions has dropped drastically, Germanystill gets almost half oc all asylum-seekers in Europe, an experts believethat the number of illegal immigrants inGermany is rising sharply.

France has had some of the same im-migration concerns as Germany. France,like Germany, views itself as a homoge-neous culture. This makes it difficult foroutsiders to win acceptance, let alonebecome assimilated. France has main-tained good relations on the whole withits former colonies; many citizens of thesenow-independent countries have movedto France. Foreign residents made up 6.4%of France's population in 1990.

As the current conflict between the

IMMIGRATION

government and the religious far-right inAlgeria threatens to produce a flood ofrefugees seeking admission to France andother Mediterranean European countries,French policy has become increasinglyanti-immigration. A bellweather is thegovernment's stand on head scarves,which are seen as a symbol of the increas-ing Islamic presence in France. Whilepermitting the wearing of crucifixes, thegovernment forbids Muslim girls to wearhead scarves in school, claiming that

wearing overtly religious garb violates theseparation of church and state.

In spite of the evidence of anti-immi-grant resentment in France, the far-rightNational Front did not win a single seatin parliamentary elections last year, butits leader, Jean-Marie Le Pen, is expectedto run for president in the spring of 1995.The conservative government of FrenchPrime Minister Edouard Balladur has de-clared the fight against illegal immigra-tion into France a high priority.

`A nationof immigrants'

DURING THE DECADE of the 1980s, morethan half the world's immigrants

gained legal admission to the U.S. Eversince the country's founding, the "goldendoor" has offered a gateway to economicopportunities and religious and politicalfreedom for millions of immigrants. Eachnew wave of immigrants has in turnfaced hostility and discrimination on thepart of the native-born populace. ManyAmericans today believe that the U.S.has reached its saturation point, that theU.S. economy and environment cannotsupport more people. A Time/CNN pollin September 1993 found that 73% of re-spondents wanted the government tolimit all immigration, legal and illegal.

Immigration to the U.S.(1980-90 by country of origin)

Mexico2.1 million

500,000

40%000

300,000

UOy

Several things are fueling the percep-tion that the U.S. is being overwhelmedby immigrants and that the situation isout of control. The plight of the Haitiansand Cubans seeking to enter the U.S.dominated news coverage for months lastyear and reopened the question aboutwho should be admitted to the U.S. andwho kept out. The highly publicizedWorld Trade Centel. bombing, carried outby terrorists who were admitted to thiscountry in spite of a record of extremistpolitical activity, contributed to the per-ception that immigrants are somehow athreat to the safety of the U.S. and thatthe U.S. has no control over who entersthe country. The movement in some

200,000

100,000

0

states, especially California, to limit stategovernment expenditures for illegal im-migrants and to seek compensation fromWashington for federally mandated ben-efits has also spotlighted anti-illegal im-migrant resentment.

Over the last 200 years, as the U.S.has grown, policy on who should be al-lowed to immigrate has been shaped bypopular pressure, political interestses-pecially ethnic groupsand foreignpolicy concerns. Frequently, laws havehad unanticipated consequences, such asthe substantial increase in immigrationand refugee flows that followed the 1965Immigration and Nationality Act Amend-ments and the Refugee Act of 1980. Theresult is a policy that often appears hap-hazard.

The doors wide openMigration to the U.S. during therepublic's early years was limited onlyby the distance involved and the cost ofthe voyage. As long as the frontier ex-isted, the doors remained open. The En-glish made up most of the immigrants toNorth America in the 17th century, andin the 18th century the Scotch-Irish andGermans predominated. In the 1840s, theera of mass migration began, as Irish,fleeing the potato famines, and Germansbegan to enter the U.S. in large numbers.Formal restrictions followed, beginningin the 1870s. By the last decade of the19th century, millions of immigrantsfrom southern and eastern Europe

Immigration Surge to the U.S.2.0

Source: U.S. Immigration & Naturalization Service.

.1).'

4'6*

0A 40 , vs.0 4045>i 4,0 0.;*

Total Immigrants

Source: U.S. Bureau of the Census

PASSAGE of the Immigration Reform and Control Act in 1986, which provided amnesty for illegal immigrants who had entered the U.S. beforeJanuary 1, 1982, and the Immigration Act of 1990, which increased the number oflegal immigrants, account forth e peak in the chart insert above.

Italians, Slays, Greeks and Jewsstartedarriving. Some 25 million people enteredthe U.S. during the peak years of immi-gration, 1880-1924.

Although most immigrants arrived onthe East Coast of the U.S., there wassome immigration to the western U.S.from Asia. Beginning in the 1840s, Chi-nese laborers were recruited to work inthe mines and to build the transcontinen-tal railroad. Many of them intended toreturn home after they had earned somemoney.

Immigration from Mexico was not anissue until this century, and opposition tomigrants usually coincided with eco-nomic hard times in this country. Thewestern U.S. was part of Mexico until1848 when, under the terms of the treatyof Guadalupe-Hidalgo that ended theMexican-American War of 1846-48,Mexico ceded New Mexico and Califor-nia to the U.S. and confirmed the U.S.title to Texas as far as the Rio Grande.The Gadsden Purchase in 1853 com-pleted the acquisition of territory in thesouthwest, adding the southern portionsof New Mexico and Arizona. During the1930s, Mexicans and some natives ofMexican ancestry were deported toMexico. In the early 1950s, apprehen-sion:: along the U.S.-Mexico border rosedramatically to more than 1 million an-nually. Arrests peaked again in the1980s.

Trying to close the doorsArguments in favor of restricting immi-gration to the U.S. have remained re-markably similar over time. There is theeconomic argument: these newcomerswill take jobs from Americans becausethey will work in worse conditions or forless pay. Then there is the standard-of-living argument: these peopie commitmore crimes or need more charity or insome way place a burden on society. Andlastly. comes the assimilation question:people from a particular religion or cul-ture who often speak a different languageeither will never be able to fit into Ameri-can society or will alter it. These havebeen joined by more recent concerns thatthe 'J.S. environment cannot supportmore people, that U.S. resources shouldbe spent on poor, ill and homeless citi-zens, not immigrants, and that the U.S.labor market no longer needs large num-bers of unskilled workers.

Although immigrants had been a pe-rennial concern since the country's be-


IMAVOIABON

ginning, there were few attempts to con-trol entry into the U.S. or to deal withimmigrants once in the country until the1870s. In that decade, aliens were guar-anteed equal protection under the law,the states could allow them to vote, andthe regulation of immigration was placedunder federal jurisdiction.

However, beginning in the 1380s,public pressure led to increasingly re-strictive legislation. Congress passed thefirst of a series of Chinese ExclusionActs (1882); importation of contract la-borers was prohibited (1885); alienscould be expelled (1888); knowledge ofEnglish was made a requirement fornaturalization (1906); the immigrationexclusion list was expanded to includepeople with physical or mental defectsand children not accompanied by parents,

ABBREVIATIONS

INS Immigration and NaturalizationService

IRCA Immigration Reform and Control Actof 1986

SAW Special Agricultural Worker

model of justice and equality. Wartimelabor shortages also played a role inchanging policy. For example, in 1943Congress enacted the Bracero Program tobring Mexican agricultural workers intothe U.S. under contract for specific timeperiods.

The McCarran-Walter Immigrationand Nationality Act of 1952 consolidatedthe various laws covering immigrationand naturalization (the process of becom-ing a citizen). It retained the quota sys-tem based on national origins, but it in-corporated some important changes.People of all races would now be eligibleboth for immigration and naturalization.However, Asians born in the WesternHemisphere would be counted toward thequota of their country of ancestry: theplain intent was to prevent large numbersof Asians entering the U.S. from LatinAmerica. President Harry S. Truman ve-toed the bill, saying, "The basis of thisquota system was false and unworthy in1924. It is even worse now. At the presenttime, this quota system keeps out the verypeople we want to bring in. It is incred-ible to me that, in this year of 1952, weshould again be enacting into law such aslur on the patriotism, the capacity, andthe decency of a large part of our citi-zenry." Congress overrode his veto.

A shift in emphasisPresidents Dwight D. Eisenhower (1953-61) and John F. Kennedy (1961-63) fol-lowed Truman's lead and sought tochange the McCarron- Walter act by dis-carding the national origins quota systemand making provision for refugees. How-ever, strong opposition in Congressthwarted their efforts. The Democraticlandslide in the 1964 elections resulted inkey changes in congressional seats andthis, together with the momentum of thecivil-rights reforms and other Great Soci-ety programs of the Johnson Administra-tion (1963-69). led to a liberalization ofimmigration policy.

In 1965, amendments to the 1952 Im-migration and Nationality Act that wereintended to make the selection systemfairer changed the direction of U.S. im-inigratio policy and unintentionally in-creased the number of immigrants admit-ted. The 1965 legislation was a productof compromise. Proponents of change hadwanted skilled workers to be at the top ofthe preference list; labor unions wantedfewer skilled workers admitted, to keepdown competition. Supporters of the na-

and limits were pined on Japaneseimmigration (1907). In 1917 the exclu-sion list was expanded to include allAsians, illiterates, alcoholics, stowawaysand vagrants.

In response to the surge in immigra-tion from southern and eastern Europe, inthe early 1910s labor union, among oth-ers, called for measures to reduce and re-strict immigration to people from certaincountries. Their efforts culminated in theNational Origins Quota Ae:t of 1924. Theact created immigration limits that re-flected the ethnic background of the U.S.population in 1890. After three years thebase year was changed to 1920. OnlyWhites, Blacks and Native Americanswere eligible for citizenship; all Asians(except Filipinos) were excluded. Thelaw also established the Border Patrol.

World War II and new foreign policypriorities resulted in several relaxationsof U.S. immigration policy. After enter-ing the war, since the U.S. was now anally of China, Congress repealed the Chi-nese Exclusion Act, and set an annual to-ken immigration quota of 105. This intorn led to granting India and the Philip-pines, also wartime allies of the U.S..quotas of 100 each. The three exceptionsto the law excluding Asians were madeto show support for allies and to prove tothe world that the U.S. was indeed a

0.1

IMMIORA110,1

tional origins standard saw family reuni-fication as a good way to keep ethnic pro-portions much as they were, without thedifficult-to-justify racial exclusionclauses. Various ethnic groups also lob-bied in support of increased visas for fam-ily reunification. In the end, family mem-bers rejoining relatives were given thehighest priority for visas. Other conces-sions to opponents of the bill included theestablishment for the first time of a quotaon immigration for countries in the West-ern Hemisphere. The legislation failed todeal with one important source of migra-tion to the U.S.: undocumented aliens. TheBracero Program had ended only the yearbefore, and the presence of illegal immi-grants was not a pressing issue.

Illegal immigrantsAccurate figures on how many illegalaliens there are in the U.S. and wherethey come from are impossible to calcu-late. Most reasonable estimates placedthe illegal population in the mid-to-late1980s at between 3 million and 5 million,with an estimated 50% to 65% fromMexico. Current estimates put the num-ber of undocumented at about 4 million.The Bureau of the Census, the Immigra-tion and Naturalization Service (INS) andmost analysts estimate that about300,000 illegal aliens enter the U.S. eachyear and remain.

Several factors account for the in-crease in illegal immigration and thegreater public awareness of it. The U.S.economy plays a big role, especially thecontinued reliance of U.S. employers onlow-wage, low-skilledlabor that is provided byillegal immigrants. Thesituation is abetted byweak enforcement oflaws against hiring ille-gal aliens and by the lackof jobs and low pay inMexico, China and otherdeveloping countries.

The presence of alarge illegal populationin the U.S. border statesand major cities is itself adraw: people emigrate tojoin relatives or to staywith others from theirhometown. For someoneanxious to emigrate, theexistence of a supportnes work is important.

Another crucial factor

is the economic situation in Mexico.Pressures, such as a rising rate of popula-tion growth, unemployment and poverty,lead growing numbers of Mexicans tocross the border into the U.S. to findwork. The 2,000-mile border withMexico provides many points of entry,and the Border Patrol has been too smalland too poorly funded to exert effectivecontrol. Those who are caught are usu-ally returned to Mexico, where they arefree to try another crossing. In the fall of1993, the INS placed more agents on theborder at El Paso, Texas, and it made ad-ditional efforts in 1994 to seal the borderin California south of San Diego. Thenumber of illegals crossing has been cutsignificantly at these points, but has in-creased elsewhere, for example on theArizona border, which is the next targetfor the INS. The Clinton Administrationplans increased funding for equipment,such as surveillance helicopters, infraredscopes and heavy steel fencing, plusmore Border Patrol agents.

Immigration reform actConcern about illegal immigration ledU.S. lawmakers in the early 1970s to at-tempt a legislative solution. The lack ofconcrete figures and conflicting interestsdelayed passage. Finally in 1986 the Im-migration Reform and Control Act(IRCA) passed. Its main provisions were:

amnesty for illegals who had en-tered the U.S. before January 1, 1982,and could prove continuous residence inthe U.S. since that time;

sanctions against employers who

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knowingly hired undocumented workers;additional visas for temporary agri-

cultural workers to harvest perishablecrops;

r a Special Agricultural Worker(SAW) amnesty.

Some 1.7 million applied for the gen-eral amnesty, and another 1.3 million forSAW amnesty (more than double thehighest estimates). Of the 3 million appli-cations, 2.2 million were filed by Mexi-cans. A congressionally mandated com-mission documented widespread fraud inthe agricultural amnesty program, butthere were no funds to investigate andtrack down those who did not legiti-mately qualify.

Problems have also arisen with theemployer-sanctions section of IRCA. It isdifficult to prosecute employers becausethey must have knowingly hired illegals.Proving that an employer knew someonewas illegal is difficult, especially becauseof the high quality of forged papers avail-able. Finally, many Hispanic applicantswith legitimate documents complain ofdiscrimination on the part of employers.

Further changes in immigration policywere included in the Immigration Act of1990, which had the net effect of increas-ing the annual number of legal immi-grants from roughly 600,000 to about800,000. In addition, a program that be-came known as the "diversity lottery,"sponsored by Senator Ted Kennedy (D-Mass.), reserved 40,000 places a year forthree years for countries adversely af-fected by the family-reunification provi-sions of the 1965 act.

Immigration was amajor concern on CapitolHill last year, and is ex-pected to get even moreattention from the in-coming Republican-con-trolled 104th Congress.The Crime Control Actof 1994 included in-creased funding for theBorder Patrol and mea-sures to make it easier todeport criminal aliensand aliens whose asylumapplications had been de-nied. A bill submitted bySenator Alan K.Simpson (R-Wyo.)would have temporarilylowered the ceiling onimmigration to provide a"breathing spell" and

THIS 1981 CARTOON captures some of the passions aroused by the debates thatculminated in passage of the Immigration Reform and Control Act of 1986.

76GREAT DECISIONS 1995 73

IMMIGRATION

would have imposed a border-crossingfee. Many of the proposed welfare re-form bills carried restrictions on federalaid to illegal aliens. They can be ex-pected to receive a more favorable hear-ing in 1995.

States' burdensIn 1993, 79% of all immigrants to theU.S. headed for six states: California,New York, Texas, Florida, New Jerseyand Illinois. Five of these states (all butIllinois) and Arizona have filed lawsuitsagainst the federal government for notenforcing and implementing the controlscalled for in the reform act of 1986. Theywant help to recover some of what theyspend on illegal immigrants, includingthe costs of medical care, education andincarceration. Because the federal gov-ernment determines immigration policy,the states argue, the federal governmentshould pay the costs.

Florida and California have also ap-plied for federal aid from a $34 millionemergency fund set up to help defraythe costs of supporting immigrants.States consider the fund a step in theright direction but woefully inadequate.Governor Lawton Chiles asked for $1.16billion to reimburse Florida for expen-ditures on immigrants, including educa-tion and food assistance, incurred since1990.

The illegal immigrant controversy isespecially heated in California, where itwas a major issue in the 1994 gubernato-rial race. According to Republican in-cumbent Pete Wilson, whose come-from-behind victory is credited to his strongstance against illegal immigrants, "Ourschools, our hospitals and our social ser-vices are overwhelmed by the federalgovernment's failure to control the bor-der." In May 1994, Wilson filed lawsuitsagainst the federal government in an at-tempt to recoup the $3 billion a year heclaims California's estimated 1.5 millionillegal aliens cost the state. During thecampaign, Wilson's opponents pointedout that his reluctance to crack down onemployers who hire illegals, especiallythe California agriculture industry, is inlarge part responsible for attractingillegals in the first place.

Wilson strongly backed Proposition187called the Save Our State (SOS)initiative by its supporters, which 60% ofthe voters approved in November. Propo-sition 187 cuts off benefits, includingeducation, welfare and nonemergency


health care, to illegals, and requiresteachers, law-enforcement officers,health-care workers and other public em-ployees to report anyone suspected ofbeing an illegal alien to immigration au-thorities. Lawsuits challenging Proposi-tion 187's constitutio..iality have beenfiled, and federal and state judges haveblocked Wilson's attempts to beginimplementing sorm of the provisions.

Many supporters of Proposition 187were aware that implementation wouldbe blocked, but saw the initiative as away to force Washington to take noticeand possibly reverse the 1982 SupremeCourt decision that says that the childrenof illegal aliens are entitled to free pri-mary and secondary education.

Opponents have condemned Proposi-tion 187 as racist, and they charge thatrequiring public employees to report sus-pected illegal aliens would create a po-lice-state mentality. They also note thedetrimental effects on the social good: forexample, not providing immunizationsand health care could lead to outbreaks ofdisease, such as tuberculosis, and noteducating children of illegal aliens couldcreate an underclass of illiterates.

The president-elect of Mexico, ErnestoZedillo, joined other angry Mexicans indenouncing the initiative, saying that itcould threaten U.S.-Mexican ties. Presi-dent Armando Calderon Sol of El Salva-dor said, "With this initiative, Gov. PeteWilson is endangering international rela-tions between the U.S. and other nations."Salvadorans working in the U.S. senthome earnings estimated at $800 millionin 1993, more than the value of all Salva-doran exports combined.

Balance sheetAlthough the Census Bureau, the INSand most analysts generally accept a fig-ure of 300,000 annual net illegal immi-grants, they disagree on the impact theyhave on the U.S. One of the most hotlydebated calculations involves whether il-legal immigrants cost more in benefits,such as health care, than they provide theU.S. in terms of the taxes they pay andthe goods they produce. Other effectsimmigrants have are harder to fit into acost-benefit analysis. For example, immi-grantsboth legal and illegaloffer di-versity and links with other countries. Dothese enrich U.S. culture and provide in-ternational trade opportunities, or do theythreaten the social cohesion of the U.S.?Do immigrants fill jobs that Americans

do not want, or do they compete withAmericans and cause wages to fall?

A report by the Urban Institute, immi-gration and Immigrants: Setting theRecord Straight, attempts to providebaseline figures. The authors, MichaelFix and Jeffrey Passel, concur with anINS estimate that the net growth in theillegal immigrant population is 200,000to 300,000 each year, and that the illegalimmigrant population in the U.S. in 1992was 3.2 million. Overall, the researchersfound that legal and illegal immigrantstogether contribute more to the U.S. thanis spent on them, generating a net annualsurplus of $25 billion to $30 billion. Al-though the federal government may see asurplus, some states do not. At the locallevel, the researchers conclude, immi-grants cost more than they contribute.

These findings have been disputed. TheCenter for Immigration Studies estimatesthe 1992 illegal population at 4.8 millionand the net annual cost to the U.S. at $29billion. The Federation for American Im-migration Reform (FAIR), a group thatwants to restrict immigration, disputes theUrban Institute's figures and claimsillegals cost more than they contribute.

According to BusinessWeek reporterMichael J. Mandel, whose findings arevery similar to the Urban Institute's, twogroups are responsible for the cost prob-lem: illegal immigrants and legal refu-gees. Mandel estimates that these twogroups, comprising over 400,000 immi-grants annually, are generally less well-educated than American citizens and aremore likely to be on welfare. If thesegroups are omitted from the statistics,according to Mandel, immigrants con-tribute much more to the governmentthan they cost, are as well-educated asAmericans, and are not likely to receivewelfare.

However, a study by economistGeorge Borjas of the University of Cali-fornia at San Diego, published in No-vember 1994, shows that an increasingnumber of immigrants are receiving wel-fare benefits. He attributes the increase tothe rising number of unskilled immi-grants entering the U.S.

RefugeesA special category of immigrant is therefugee. The Refugee Act of 1980 of-fered the prospect that the U.S. wouldjudge all refugees and asylum applicantsby the same standards. The fact is thatconflicting U.S. domestic and foreign

lAVAIGRATION

policy interests frequently lead to sharpdifferences in treatment.

The UN Universal Declaration of Hu-man Rights declares that "everyone hasthe right to seek and to enjoy in othercountries asylum from persecution." Twokey terms in this and other documentsdealing with refugees are asylum andpersecution. Although everyone has theright to seek asylum, states have the sov-ereign right to refuse to grant asylum. Inaddition, there is no universally accepteddefinition of persecution, and the proofthat asylum-seekers must submit variesfrom country to country.

Before Congress en-acted the Refugee Act of1980, the U.S. defined arefugee as a personfleeing a Communist orCommunist - dominatedregime or a Middle East-ern country. The RefugeeAct broadened the defini-tion to include "a personwho has been persecutedor has a well-founded fearof persecution on accountof race, religion, nation-ality, membership in aparticular social group, orpolitical opinion." TheRefugee Act set a singlestandard for consideringasylum applications andobligated the government not to return arefugee to a country where he or she fearspersecution.

There is a cap on the number of refu-gees admitted into the U.S. each year, butin special cases the President has waivedthe requirements to allow in certaingroups, using the parole power of theMcCarran-Walter Act. PresidentEisenhower first invoked it in 1956 toadmit thousands of Hungarians escapingSoviet repression after the HungarianRevolution. The parole power was in-tended to apply to individuals, not groups,but the precedent Eisenhower establishedwas used by Presidents Kennedy to ad-mit Cubans and Hong Kong Chinese;Gerald Ford (1974-77) to admit Vietnam-ese; and Bill Clinton to admit Cubans.

Once within U.S. territory, a personmay apply for asylum to the INS. If theapplication is denied, the asylee can re-new the application before an immigra-tion judge at deportation hearings. Ifturned down again, the asylec can appealthe judge's decision to the Board of Im-

migration Appeals, and then to the fed-eral court system. The backlog of asylumapplications has been growing steadily: infiscal year (FY) 1991, there were 97,000cases; in FY 94, the number stood at330,000.

Some U.S. asylum practices havebeen criticized by human-rights groups.These include treating one group of asy-lum-seekers (e.g. Haitians) differentlyfrom another (e.g. Cubans); interceptingrefugees at sea and returning them beforethey can reach the U.S. and claim asy-lum; keeping asylum-seekers in detention

were given temporary refuge. Many oth-ers drowned at sea.

To halt the Haitian exodus, PresidentGeorge Bush declared that Haitian boatpeople intercepted at sea were to berepatriated. The U.S. would only considerasylum requests submitted at one of threeU.S. diplomatic posts inside Haiti. Presi-dent Clinton continued the Bush policyuntil a new wave of boat people andgrowing domestic pressure prompted theAdministration to change course. In May1994 it announced that in the future itwould grant asylum hearings to Haitian

refugees bound for the

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U.S. who were picked upin international waters. Asthe number of refugeesswelled to the tens of thou-sands, the U.S. sought"safe havens" for the Hai-tians in Panama and else-where in the Caribbean.However in July, afterPanama turned the U.S.down, the U.S. then de-clared it would house therefugees at GuantanamoBay. At the same timeWashington weighedmilitary intervention.

While Washingtonwas still struggling with

DANzro'N"'Ec"t's'",:l^c"x.'0'0'cc"cY5 the Haitian problem (itwas resolved later in the

year by Aristide's return to Haiti, pre-ceded by over 15,000 U.S. troops andsmall UN contingents), another refugeecrisis exploded in August, when thou-sands of people fled Cuba for Florida.Considered political refugees from com-munism, Cuban refugees have beenreadily admitted to the U.S. The 1966Cuban Adjustment Act, passed at theheight of the cold war, gives the attorneygeneral the authority to admit Cubansarid, after one year, to adjust their statusfrom parolee to legal resident.

The greatest number of refugees fromCuba ever to come to the U.S. was in 1980,when President Fidel Castro allowedsome 125,000 to leave from Mariel andother ports. The so-called Mariel boatliftcreated hardships in south Florida andforced the U.S. government to set up tem-porary centers throughout the country tocope with the exodus. Castro is believedto have included many undesirablesprisoners and mentally illamong therefugees.

The August 1994 flood of refugees

centers, often for long periods of timewhile their cases are pending.

Two recent waves of asylum-seekersillustrate the vagaries and contradictionsof U.S. policy toward refugees.

Haiti and CubaFor decades Haitians have fled militaryrepression and economic privation. Somereceived political asylum in the U.S., butmany others were judged economic mi-grants and were returned to Haiti.

After the ouster of Jean-BertrandAristide, the first democratically electedpresident in Haiti's history, in September1991, the U.S. imposed economic sanc-ticns on Haiti to try to pressure the newmilitary rulers to step down and letAristide return. The brutal treatment ofAristide's supporters and the worseningeconomic situation as a result of thesanctions triggered a mass exodus by sea.The U.S. Coast Guard picked up manythousands of Haitians in early 1992 andtransported them to the U.S. base atGuantanamo Bay, Cuba, where they


was touched off by Castro's announce-ment that the island's sugarcane harvestwas the lowest in decades. This, com-bined with the loss of subsidies from theSoviet Union and the continued U.S. eco-nomic sanctions, created an economiccrisis. Castro threatened to allow allCubans who chose to do so to leave byboat unless Washington changed its im-migration policy. As Cubans piled intounseaworthy craft headed for Florida,Governor Chiles declared a state of emer-gency. Clinton abruptly reversed long-standing U.S. policy and announced thatCubans fleeing by boat would no longerbe allowed into the U.S. The attorneygeneral, Janet Reno, added that anyoneattempting to smuggle Cubans into thecountry would be prosecuted.

IhIMIGRATION

In September, the U.S. and Cubareached an agreement in which the U.S.would accept a minimum of 20,000Cuban immigrants each year (up fromabout 6,000). Of the 20,000 visas, some5,000 to 6,000 will be distributed by lot-tery. The policy toward the approxi-mately 32,000 Cuban boat people beingheld at Guantanamo and in Panamaremains unchanged: they must return toCuba to apply for visas. Although pres-sures from the Cuban-American commu-nity to allow them to enter the U.S. havebeen growing, Castro adamantly opposessuch action.

With President Aristide back in Haiti,the Clinton Administration expects theHaitian refugees at Guantanamo to returnhome.

Current proposalsIN THE TANGLED DEBATE over immigra-

tion, there is little agreement on theissues, let alone the remedies. Somegroups, such as the Federation for Ameri-can Immigration Reform, want to reducethe number of immigrants admitted eachyear. FAIR believes that the present largenumbers of immigrants are not in the na-tional interest. In economic terms, it be-lieves immigrants take jobs from Ameri-cans or, by increasing the number ofworkers, depress wages. In culturalterms, FAIR is concerned that a largeimmigrant flow over many years makesassimilation difficult or virtually impos-sible. FAIR proposes what it calls a"moratorium," actually an annual cap onlegal immigration to the U.S. of 300,000,as opposed to the current figure of closeto I million.

FAIR and other groups are worried thatthe U.S. is admitting too many under-skilled and undereducated people at a timewhen businesses are interested in skilledworkers and government leaders look toa future requiring high-skill, high-techworkers for the economy to remain com-petitive. They see this leading to a grow-ing underclass of underpaid and unem-ployed workers. According to economistBorjas, "ethnic skill differentials disap-pear very slowly. It might take four gen-erations, or roughly 100 years" for thosewho come to the U.S. with lower -than-average education or skills to catch up.

Other groups disagree with these con-


elusions. According to an Urban Institutestudy, immigrationboth legal and ille-galoverall has little effect on jobs fornative-born Americans. According toPassel, one of the authors of the study,"The evidence we see is strong that im-migrants create jobs."

Barbara C. Jordan, former Democraticcongresswoman from Texas and head ofthe federal advisory U.S. Commission onImmigration Reform, has testified thatthere is no evidence to suggest that immi-grants are coming to the U.S. to get wel-fare benefits, and she does not supportbanning these benefits for legal immi-grants. Most legal immigrants are thespouses, children, parents or siblings of aU.S. citizen or long-term permanent resi-dent. Jordan recommended that the im-migrants' sponsors be held legally re-sponsible for supporting those they bringinto the U.S.

Ethnic lobbies would like to have morevisas available for their particular groups.The Irish Immigration Reform Move-ment, for example, was able to increasethe number of visas available to Irish ap-plicants in the 1991-94 visa lottery.

Liberal and conservative political la-bels do little to clarify the issues in theimmigration debate. Some liberals sup-port high immigration levels because oftheir concern for the welfare of under-privileged persons and for other humani-tarian reasons. Others would reduce im-migration levels out of concern for the

7 Li

impact of immigration on job opportuni-ties and the advancement of minorities atthe low end of the economy.

Conservatives are also split over im-migration. Some want to reduce immi-gration because they see it encouragingmulticulturalism, which they considersocially divisive. Some want to changethe requirements so that more skilledpeople are given preference. Still othersfavor denying many benefits to immi-grants, legal and illegal, as a means ofreducing the cost of social welfare. Otherconservatives support immigration be-cause they feel the newcomers are goodfor the economy, provide low-cost laboror start new businesses.

Consensus on illegalsThere is consensus on one issue: some-thing must be done about illegal immi-gration. However, there is no agreementon solutions.

Many believe the key to controllingillegal immigration is stopping U.S. em-ployers from hiring illegals. The 1986IRCA employer sanctions have not beenenforced, in large part because employerscan claim that they did not know employ-ees' papers were not valid. The JordanCommission has proposed setting up acomputerized register of the names andSocial Security numbers of all citizensand aliens authorized to work in the U.S.,to be used only by employers checkingon the eligibility of job applicants towork. Opponents claim this would leadto national worker identification cards.

As evidenced by the passage ofProposition 187 in California, manypeople support cutting off benefits suchas health care and education for illegalaliens, not L ply to reduce state expendi-tures, but also to reduce the incentive forpeople to immigrate illegally.

An important part of any plan to curbillegal immigration has to involve increas-ing the resources of the INS and the Bor-der Patrol, which lre under the jurisdic-tion of the Justice Department. The NewYork Times, in a scathing five-part serieson immigration in September 1994 called"Chaos at the Gates," detailed corruptionand ineptness at INS. Underpaid, over-worked employees, responsible for dis-tributing green cards and other documen-tation, are easy targets for bribery. Be-cause of inadequate funding over manyyears, the agency is understaffed and hasnot had access to technology that wouldassist in keeping track of people entering

-

the U.S. or persons detained for enteringillegally. Limits on staffing also affect theability of INS to track down and deportillegals who have made it past the bolder,and the proliferation of fraudulent docu-ments has made a mockery of the enforce-ment of employer sanctions.

U.S. policy optionsLegal ImmigrationJ 1. Reduce the level of immigrationinto the U.S.

Pro: The U.S. cannot afford the socialand economic costs of close to 1 millionlargely unskilled immigrants each year.Immigration contributes to populationgrowth, and a larger U.S. population willoverwhelm the country's resources.

Con: The U.S. has always acceptedimmigrants; the country is stronger be-cause of the diversity; the new immi-grants do useful work that others are un-willing to perform; and their demand forgoods and services expands theeconomy. Human ingenuity will find asolution to the increased demands that alarger population will place on resources.

2. Give priority in immigrationpolicy to people with skills rather thanemphasizing family reunification.

Pro: The family-reunification stress inimmigration policy has resulted in muchhigher numbers of entrants than wasanticipated. The newcomers are often un-skilled and uneducated, and they are aptto depend on welfare benefits.

Con: Family reunification is one ofthe goals enunciated at the UN Interna-tional Conference on Population and De-velopment in Cairo in September 1994and is important for humanitarian rea-sons. Immigrants who come to the U.S.under this program have family membersto vouch for them and are less likely togo on welfare or otherwise be a burden tothe state.

3. Decrease the number of refugeesand asylum-seekers admitted annually.

Pro: The U.S. has been too generousin opening its doors for humanitarian rea-sons. Let other nations do their part. Sta-tistics show that refugees are more apt tobe on welfare than the general populationor other legal immigrants.

Con: In many cases, U.S. foreignpolicy has had a direct role in creatingrefugees; for example, the U.S. em-bargoes against Cuba and Haiti resultedin severe economic hardship in thosecountries. The U.S. has a responsibilityto offer shelter to those injured by its

IWAIORATION

policies. Also,many refugeesare fleeing per-secution andoppressive po-litical regimes;the U.S. shouldlive up to itsimage as achampion offreedom anddemocracy bytaking in thesepeople.IllegalImmigrationJ 1. Attackthe problemat its source:help improveconditions inthe countries that supply most illegalimmigrants, and the number of peoplewho feel compelled to leave willdecline.

Pro: By investing overseas and open-ing markets to goods from less-devel-oped countriesthat is, importing goodsrather than peoplethe U.S. and theother developed countries will discour-age the number of people leaving homefor economic reasons. Also, increasedfunding for family-planning programswill slow the rate of population growth inless-developed countries and ease thepressure on people to emigrate.

Con: At a time when many developedcountries themselves are battlingrecession and unemployment, they arepoor markets for imported goods. Thebenefits from programs that slow popula-tion growth will not be seen for decadesand are not a solution to the immediateproblem.J 2. INS should take stronger mea-sures to regain control of U.S. borders.

Pro: At least half of all illegal immi-grants enter across the U.S. border withMexico, and they settle primarily instates on the border. New measures un-dertaken recently, such as increasing thenumber of Border Patrol agents, buildingwalls and using more-sophisticatedequipment, have proven effective andshould be continued and expanded.

Con: Border-control measures arelike squeezing a balloon: tightening up inone area causes the balloon to bulge inanother area. Immigrants who can't crossthe border at El Paso or San Diego willtry somewhere else, and the cost of cov-

BC

914045 Bilks' -5w DEGO IP:0,111tal.Aff

ering every foot of the border is too high.Also, sealing off the border could haveserious consequences for Mexico andhurt U.S.-Mexican relations..J 3. Strengthen employer sanctions.

Pro: Penalties for employers who hireillegals should be increased and enforced.If employers did not create the demand,the stream of illegals would quickly dryup. A national work-verification systemshould also be instituted to assure thatonly citizens and legal residents eligibleto work are allowed to work.

Con: Current sanctions against em-ployers are adequate. A work-verificationsystem could increase discriminationagainst members of racial and ethnic mi-norities and could lead to the establish-ment of a national identity card.J 4. Deny education, health and social-welfare benefits to illegal immigrants.

Pro: People in the U.S. illegallyshould not have the same rights as thosehere legally. The burden for taking careof illegal immigrants falls disproportion-ately on a few states that are hard-pressedto provide services to their own citizens.The countries these people come fromshould be responsible for their educationand health care.

Con: Not providing health care toillegals could adversely affect the wholepopulation. For example, not treating il-legal immigrants who have tuberculosiscould result in the spread of the disease.The Supreme Court ruled that all immi-grants are entitled to protection under the14th amendment, and that children of il-legal immigrants are entitled to a freeeducation.


IMMIGRATION

1. Illegal immigration affects primarily ahandful of states. What obligations dothese states have for their illegal immi-grant population? What responsibilitydoes the federal government have?

2. Should there be a "breathing spell" onimmigration to the U.S.? Is present im-migration policy too lenient? How wouldyou change it?

3. Proposition 187 was passed over-whelmingly by California's voters, but itsconstitutionality has been challenged.Where do you stand on Proposition 187?Should illegal immigrants be denied theprotection of the constitution?

4. If sanctions against employers whohired illegal immigrants were tightened,would this have a major impact on illegalimmigration? What effect would it haveon the employers?

5. U.S. policy toward refugees andasylum-seekers has been inconsistent.Should there be one U.S. policy for boat

people, regardless of whether they areVietnamese, Haitian or Cuban? or shouldeach situation be judged in light of otherU.S. interests?

6. Should refugees from political perse-cution receive different. treatment fromrefugees from economic hardship?

7. How do you account for the currentanti-immigration backlash? Is it a tempo-rary phenomenon, in your opinion?

8. As a land of immigrants, does theU.S. have an obligation to keep the torchlit for tomorrow's immigrants?

A I A U_DIP D

Beck, Roy, "Right of Silence? The GOP and Immigration."National Review, July 11, 1994, pp. 27-35. Looks at disparateRepublican views on legal immigration and describes variousscenarios for the U.S., depending on which policy is adopted.

Clad, James C., "Slowing the Wave." Foreign Policy, Summer1994, pp. 139-50. An overview of the immigration issue, withemphasis on the impact on U.S. foreign policy.

Fix, Michael, and Passel, Jeffrey S., Immigration and Immi-grants: Setting the Record Straight. Washington, D.C., TheUrban Institute, 1994. 104 pp. $10.00 (paper). An attempt toprovide a factual base and framework for discussion of immi-gration policy. Includes figures on where immigrants are fromand where they live, and also looks at their impact on the labormarket and public services.

Fukuyama, Francis, "Immigrants and Family Values." Com-mentary, May 1993, pp. 26-32. Examines the perceived threatto Anglo-American cultural values posed by Third Worldimmigration.

"The Immigration Wars." The Nation, October 17, 1994, pp.410-25. A series of four articles that looks at various aspects ofthe immigration issue, including misapprehensions about immi-grants, potential problems caused by increasing the strength ofthe Border Patrol, California's so-called Save Our State initia-tive and immigrant smuggling by Chinese.

Reimers, David M., Still the Golden Door: The Third WorldComes to America, 2d ed. New York, Columbia UniversityPress, 1992. 362 pp. $18.00 (paper). Provides extensive back-ground on Third World immigration to the U.S., including his-tory and current issues and policy.

The State of World Population 1993. The Individual andthe World: Population, Migration and Development in the1990s. New York, United Nations Population Fund (Unfpa),


1993. 54 pp. Available free from Unfpa, 220 East 42d Street,New York, N.Y. 10017. Examines the factors responsible forthe increase in world migration.

"The Tides of Humanity: 123 Million People on the Move."World Press Review, October 1994, pp. 8-13. Internationalperspectives on immigration.

CENTER FOR IMMIGRATION STUDIES (CIS), 1815 H St., N.W., Suite1010, Washington, D.C. 20006-3604; (202) 466-8185. Anonprofit research institution. CIS studies the effects of immi-gration on the economic, social, demographic and environmen-tal interests of the U.S.

THE FEDERATION FOR AMERICAN IMMIGRATION REFORM (FAIR),1666 Connecticut Ave., N.W., Suite 400, Washington, D.C.20009; (202) 328-7004. A public-interest organization work-ing to end illegal immigration and reduce levels of legal immi-gration. FAIR publishes teacher's guides and fact sheets.

NATIONAL COUNCIL OF LA RAZA (NCLR), 810 1st St., N.E., Suite300, Washington, D.C. 20002-4205; (202) 289-1380. Thelargest constituency-based national Hispanic organization,NCLR works to empower Hispanics from the grass roots on up.Publications include Unfinished Business: The Immigration ,

Reform and Control Act of 1986.

NATIONAL IMMIGRATION FORUM, 220 I St., N.E., Suite 220,Washington, D.C. 20002; (202) 544-0004. A nationwide coa-lition comprised of over 200 organizational members, dedicatedto promoting fair and generous immigration policies in the U.S.The forum also conducts applied research and policy analysis.

URBAN INSTITUTE, 2100 M St., N.W., Washington, D.C. 20037;(202) 833-7200, Publications: (202) 857-8687. A nonpartisanpolicy research organization, the institute investigates socialand economic problems confronting the U.S. and assesses gov-ernment policies and programs designed to alleviate them.

U.S. COMMISSION ON IMMIGRATION REFORM, 1825 ConnecticutAve., N.W., Suite 511, Washington, D.C. 20009; (202) 673-5348. Established by Congress, the commission publishes aseries of recommendations on immigration reform. Contact forpublications.

81

OPINION BALLOTSHow to use the Opinion Ballots: For your convenience, there are two copies of each opinion ballot. Please cut out and mail oneballot per person only. To have your vote counted, please mail ballots by June 30, 1995. Send ballots to:

FOREIGN POLICY ASSOCIATION, 729 SEVENTH AVENUE, NEW YORK, N.Y. 10019M IM DM Mil MI IIM MI M Mill OM IN M RI la ME MI M M III NI IN MI INI Vill MIS MI IIM M Mill IM MI MI In IIM MI Mil IR

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1. Be increased.

2. Remain the same.

3. Be decreased.

ISSUE B. Special emphasis in U.S. immigration policy shouldbe given to (choose one):

L Family reunification.

2. Skills and needs of the labor market.


ISSUE C. The number of people admitted to the U.S. onhumanitarian grounds should (choose one):

1. Be increased.

2. Remain the same.

3. Be decreased.



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TOPIC

.7 ImmigrationISSUE A. Immigration levels to the U.S. should (choose one):

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2. Remain the same.

3. Be decreased. E4

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1. Family reunification. rfi

2. Skills and needs of the labor market.


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ISSUE C. The number of people admitted to the U.S. on Elhumanitarian grounds should (choose one):

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2. Remain the same.

3. Be decreased.



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N DemocratizationII 8 Democratization 61

N ISSUE A. Considering U.S. policy in the post-cold-war era, ii ISSUE A. Considering U.S. policy in the post-cold-war era. i]I do you agree or disagree with the following statements: do you agree or disagree with the following statements: nAGREE DISAGREE 0s 1. The highest priority of U.S. foreign CI

51policy should be the promotion of

Uli democracy abroad. 0

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2. It is right for U.S. forces to intervenein another country to rescue the 2

11 population from human-rights abuses ninflicted by an authoritarian regime.

61

El3. The U.S. should not interfere in the

(3politics of other nations.

El

1. The highest priority of U.S. foreignpolicy should be the promotion ofdemocracy abroad.

2. It is right for U.S. forces to intervenein another country to rescue thepopulation from human-rights abusesinflicted by an authoritarian regime.

3. The U.S. should not interfere in thepolitics of other nations.

AGREE

0

0

0

DISAGREE

0

0

1EISSUE B. Concerning U.S. efforts to promote democracy

ElISSUE B. Concerning U.S. efforts to promote democracy

gabroad, the U.S. should (choose one): abroad, the U.S. should (choose one):

LI I. Increase the level of support.ti 1. Increase the level of support.

2. Maintain the same level of support.rz

2. Maintain the same level of support.3. Cut back the level of support.

g3. Cut back the level of support.

4. Eliminate such support altogether.El

4. Eliminate such support altogether.5. Other, or comment 5. Other, or comment

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MFirst three digits of your zip code:

WFirst three digits of your zip code:

Date: / /1995 Ballot continues on reverse side I Date: / /1995 Ballot continues on reverse side... IIIII immammmaimmmimmammimmemmmimmmilumismmmamammm......1......111

GREAT DECISIONS I99t 79

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ISSUE D. Concerning the problem of people enteringthe country illegally, the U.S. should:

YES NO

1. Take stronger measures to controlU.S. borders.

Increase penalties for hiringillegal aliens.

3. Penalize illegal workers.

4. Institute a national work-verificationsystem.

Deny educational, health and socialwelfare benefits to illegal aliens,including their children.

Amend the Constitution to denycitizenship to children born in theU.S. to illegal aliens.

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UA. How many rears have you participated in the GREAT DEcisiopis A. Hotv many years hate you participated in the GREAT DECISIONS Ei

program (that is. attended one or more discussion sessions)? ti program (that is, attended one or more discussion sessions)?

U 0 1. This is the first year 1 have participated.0 2. I participated in one previous year.

3. I participated in more than one previous year.B. What is your age?

1! 0 1. 17 or under 0 2. 18 to 30 3.31 to 45n 4.46 to 60 5.61 or over

C. Your sex?m 1. Female

2. Male0 D. Have you been abroad during the last four years?g ca 1. Yes

Ei 2. No


ISSUE D. Concerning the problem of people enteringthe country illegally, the U.S. should:

YES NO

I . Take stronger measures to controlU.S. borders.

2. Increase penalties for hiringillegal aliens.

3. Penalize illegal workers.

4. Institute a national work-verificationsystem.

5. Deny educational, health and socialwelfare benefits to illegal aliens,including their children.

6. Amend the Constitution to denycitizenship to children born in theU.S. to illegal aliens.


a

in:/ 0 1. This is the first year ! have participated.0 0 2.1 participated in one previous year.n 3. I participated in more than one previous year.

B. What is your age?I. 17 or under 2. 18 to 30 3.31 to 45

0 4.46 to 60 0 5.61 or overC. Your sex?

1. Female

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A 3. Some college 4. College graduate 0 3. Some college IZI 4. College graduate

0 5. Advanced degree 0 5. Advanced degree Itil F. How often are you asked for your opinion on foreign policy matters? 0 F. How often are you asked for your opinion on foreignpolicy matters? 11

il 1. Often 2. Sometimes 0 3. Hardly ever 0 I. Often 2. Sometimes 3. Hardly everi!IG. One final question. Would you say you have or have not changed your n G. One final question. Would you say you have or have not changed your

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Promoting democracy:America's mission?The U.S. annually spends nearly a billion dollars promotingdemocracy abroad. What does it get for its money? Is its ideaof democracy relevant only to the West, or has it universalappeal?

by Richard H. Ullman

6-6 ELL POPPER tO Cut out thepolitical science lectures."Thus, according to The New

York Times, did Secretary of State HenryA. Kissinger in July 1974 instruct an aideto admonish the U.S. ambassador inChile. A military coup the previous yearhad swept away that country's constitu-tionally elected democratic government.The Nixon Administration, in whichKissinger served, had covertly supportedthe Chilean conspirators, judging that theretention of power by the professedlyMarxist president, Salvador G. Allende,would facilitate the rise in the hemi-sphere of other leaders opposed toAmerican policies. Allende was killed inthe coup. What aroused Kissinger'swrath a year later was a report from Am-bassador David H. Popper recounting hisefforts to convince the ruling junta tocease torturing its democratic opponents.

Kissinger the practitioner of powerpolitics deplored efforts to instructfriendly governments on how to ordertheir internal affairs. They were, hethought, usually counterproductive andalways an irritant in bilateral relations.Kissinger the historian of statecraft, how-ever, was well aware that such efforts areintegral to the way Americans have seentheir nation's role in international politicsand to its conduct of foreign policy. At-tempting to change that approach, he im-plied in his 1994 book, Diplomacy, wouldbe futile, perhapsbecause it would goagainst America's natureeven an error.

Since the foundation of their republic,Americans have distinguished their soci-

ety from others by its quasi-religiouscommitment to liberal, constitutionaldemocracya form of government char-acterized in our own era by a voting fran-

10PIC

8chise in which all citizens may participate,contested elections at regular intervals, anexecutive either popularly elected or re-sponsible to an elected legislature, andguarantees of such civil liberties as freespeech. The American republic is theworld's oldest continuously democraticstate. But even in its infancy, during thelast years of the 18th century and the firstof the 19th, Americans were divided as tothe practical meaning of their democracyfor the conduct of foreign policy.

America's choicesFor some, conscious of America's rela-tive weakness in comparison with the es-tablished powers of Europe, the prudentcourse of action was something approach-ing isolation. That was the advice of theirfirst President, George Washington, whowarned against involvement in the quar-rels of the European powers and the en-tangling alignments that involvement

RICHARD H. ULLMAN is David K.E. BruceProfessor of International Affairs, Center of BUILDING DEMOCRACY: Chinese students in Tiananmen Square, May 1989, creating their ownInternational Studies, Princeton University. Statue of Liberty, the "Goddess of Democracy."

84OREAT DECISIONS 1995 81

would inevitably entail. Many Americansthought that their young institutions werestill too fragile. Overseas wars would openthe door to authoritarian leadership andto the exaltation of martial valuesrank,title, privilegeanathema to the workingsof a healthy democracy with a profoundlycivilian culture.

Others-18th-century forerunners ofso-called realist thinkers and statesmenlike Kissingerregarded involvement inEuropean power politics as an inevitablepart of a successful strategy for the de-fense of a weak and vulnerable U.S. Inthe 20th century, when America wasstronger, most realist thinkers would judgesuch involvement as necessary not somuch for defense as to advance Ameri-can interests, in particular the promotionand safeguarding of an internationaleconomy open and receptive to goods,services and investments from the U.S.

A third strand of thought and of policyfocused upon American democracy itself.The new republic would be more secureif it were not alone, but in the company ofother democratic states. The more suchstates the better: there would be safety innumbers. That was because democracieswere believed to pose no threat to otherdemocracies: they were inherently peaceloving. In that respect they differed fromstates whose institutions represented theinterests of a monarch or an oligarchyrather than those of the entire nation. Ifthat assumption of difference were valid,however, it still left the question: Whatcould America do to assure that democ-racy would prosper elsewhere? The ques-tion has vexed policymakers ever since.

The democratic peaceIn the early 1980s, some two centuriesafter the founding of the Americanrepublic, the political scientist MichaelW. Doyle carefully examined the histori-cal record and, in a series of influentialarticles that were published in Philoso-phy and Public Affairs (June and October1983) and the American Political ScienceReview (December 1986), concluded thatliberal, constitutional democracies indeeddo not go to war with one another. Doyledid not claim that democracies do notmake war. Quite the contrary: there are,he pointed out, many examples of warsbetween democratic and authoritarianstates in which the former are at least asresponsible as the latter for straining rela-tions and escalating hostilities that ledeventually to war.


PROMOTING DEMOCRACY

Neither Doyle nor the many scholarswho have commented and enlarged uponhis work have fully explained why his-tory contains virtually no examples ofliberal democracies making war on otherliberal democracies. But at least two fac-tors seem to be at work. The first is thesimple but centrally important fact thatconstitutional democracies are transpar-ent. They are arenas of discourse. Nogovernment likes sharing information,but governments of liberal democracieshave no alternative but to do so. Whenleaders are required to go to the peopleon a regular basis to renew their mandate,they have to explain what they are doingand persuade the electorate that theirpolicies make sense. The consequent de-bate is as audible abroad as it is at home.

AID

NATO

NED

UNA

ABBREVIATIONS

Agency for InternationalDevelopment

North Atlantic TreatyOrganization

National Endowment forDemocracyUnited States InformationAgency

Moreover, it is not a closed debate. Othergovernments or economic entities such astransnational corporations can make theirviews known and thus contribute to thebody of information that constitutes thepublic record upon which governmentand opposition alike must draw. Many ofthe lobbyists who prowl the corridors ofCongress represent foreign governments.They are malignedsometimes right-fully sofor exerting undue influence onthe American policy process. Yet theyare also valuable sources of information.

A second explanation for the demo-cratic peace is that democracies adjustmore easily to the claims of other democ-racies than they do to those of authoritar-ian states. They are more likely to giveother democracies the benefit of the doubtand to defuse tensions rather than esca-late them. Democratically elected leaderstend to deal with one another across na-tional borders the way they deal with otherleading figures within their own countrythrough negotiation and comprom;se. Itis of critical importance that their govern-ments enjoy a legitimacy that the govern-ments of nondemocratic states generallylack. That legitimacy makes it much easierfor organized interests in one democracy

to support the claims of counterpartgroups in another, often going so far as toform alliances against competing interestswithin both societies. Such border-crossing alliances formed among tradeunions, on the one hand, and industrial-ists, on the other, at the outset of theprocess of European integration in the1950s. They laid the foundation for theunification that followed.

Mutual respect for the legitimacy ofeach other's democratic political orderand for decisions made within it is onereason why it is extraordinarily unlikelythat the U.S. and Japan will again go towar with one another, no matter howstrenuously they may differ on trade andother economic issues. Washington might,as it has in the past, retaliate against Ja-pan for alleged unfair practices. Even ifTokyo were to intensify the complained-of activity, the downward spiral in therelations between the two states wouldstill be largely confined to the economicsphere. That would be harmful enough,but far removed from war. In 1941, afterthe Japanese Imperial Army had occupiedmuch of East Asia and reduced to a shamwhat might have become democracy athome, Tokyo did choose war withAmerica. The only conceivable circum-stance in which it might do so again wouldbe rejection of the liberal postwar consti-tution that the American occupiers helpedwrite and reversion to authoritarian rule.That is not likely to happen: democracyis firmly implanted in Japan.

Democracy in reborn statesBy contrast, democracy is much lessfirmly rooted in some of the reborn statesof Eastern Europe that rejected commu-nism in 1989-90, particularly those thathave risen from the ruins of what wasonce the Soviet Union. Many of these so-called new democracies cannot accu-rately be described as truly liberal.Trained in the mthless, conspiratorialpolitics of communism, their leaders donot feel impelled toward negotiation andcompromise. And anathema to them areinformation-shaming, freedom to criticize,and not merely toleration but actual en-couragement of oppositionall featuresthat go to make up liberal democracy.Two pairs of these new statesArmeniaand Azerbaijan, Croatia and Serbiahave lately been locked in combat. Theseand other ongoing wars (in Bosnia-Herzegovina, for example) do not dis-prove the contention that liberal democ-

85

PROMODNO DEMOCRACY

racies do not make war on one another.Rather, they are demonstrationsas ifanyone needed onethat the states in-volved are not yet functioning constitu-tional democracies.

Magnifying the threatA corollary to the argument that liberal,constitutional democracies do not threatenone another is the contention that autoc-racies do pose a threat, often to one an-other but especially to democracies. Manyautocratic regimes that do not derive theirauthority from dynastic roots, in particu-lar those of relatively modern states suchas the successor-republics to the formerSoviet Union, suffer from an absence oflegitimacy in the eyes of their ownpeoples. Rigged elections that do not of-fer a genuine choice breed cynicism, dis-sent andultimatelyresistance andopposition. Often a regime will decide thatit must repress domestic dissidence, whichit then attempts to justify by pointing tothe presence of a threatening externalenemy. The U.S. played such a role inSoviet demonology from the onset of thecold war in 1947. Since dissent in the faceof such a threat might fatally weaken thestate, it is forbidden as an unaffordableluxury. Like many such prophecies, thisone was self-fulfilling: Soviet suppressionof liberty throughout Eastern Europeimpelled the creation in 1949 of the NorthAtlantic Treaty Organization (NATO), amilitary and political alliance which sooncame to embody precisely what Mos-cow's pronouncements had described asmost threatening.

Just as Soviet propaganda magnifiedthe offensive threat posed by NATO, soSoviet leaders felt constrained to mount aforward defense in response. That meantretaining tight control over the East Eu-ropean states on which, in the aftermathof World War H, Moscow had imposedCommunist regimes. It also meant at-tempting to expand its sphere of controlinto areas where power vacuums had de-veloped, such as Afghanistan followingthe coup by local Communists in April1978. Western analysts were divided overwhether what seemed to be the Soviet in-vasion of Afghanistan was driven by of-fensive motivations (e.g., a desire forwarm-water ports, for control of the oilresources of the Middle East, or for thespread of the Soviet version of Commu-nist ideology), by defensive ones (the fearthat once Soviet control began to unravel,there would be no stopping place), or sim-

ply by opportunism. But most regardedthe U.S.S.R. as inherently expansionist.

The Soviet Union seemed to pose aworldwide threat because it was anuclear-armed superpower committed toa revolutionary ideology. So, it should beremembered, did the People's Republicof China once, although it had not yetacquired nuclear weapons. During the1950s and 1960s, indeed, when Chineseleaders spoke of organizing the poor (andlargely authoritarian) countries of theThird World against the affluent liberaldemocracies, China seemed in some re-spects more threatening than the U.S.S.R.Today it is difficult to remember thatonly three decades ago liberal, constitu-tional democracy sc.nned to be an ex-travagance of the rich, white states ofNorth America and Western Europe,Australia and New Zealand, and of the"honorary Europeans" of Japan. Clearlynot all authoritarian states posed a threatto this enclave of privilege, but some cer-tainly did, and many Western analyststhought that the threat would grow moresevere rather than less.

Some drew the conclusion that the lib-

eral democracies would not be safe in aworld of powerful totalitarian and au-thoritarian states. The threat of warwould never be absent. With that threatwould come a more subtle but no less se-rious dangerthat the threatened democ-racies might become garrison states. Ifthe military threat seemed severe enough,the democracies might feel impelled toadopt some of the repressive ways oftheir opponents. In the name of vigilanceand unity, their leaders might be temptedto impose increasing restrictions on civilliberties. The result could be deeply cor-rosive, as Americans found during theearly 1950s when the anti-Communistcampaign of Sen. Joseph R. McCarthy(R-Wis.) and his followers succeeded insilencing many critics. Because the freeexchange of ideas across frontiers is sovital to democracies, the stifling of dis-sent in one society increases the isolationof dissenters elsewhere and makes itmore difficult for them to speak theirminds. And when critical opinions arecurbed, it is less likely that governmentalpolicies will truly be humane and respon-

1 sive to the needs of a population.

Recruiting for thedemocratic club

FOR BOTH POLICYMAKERS and outsidecommentators, promoting liberal,

constitutional democracy as a goal of for-eign policy has been synonymous withpromoting human rights, especially whenthe rights emphasized are civil and politi-cal rights. A precondition of any effec-tive democracy is that those who exercisetheir right to vote should also enjoy free-dom of speech and assembly and integ-rity of the person, meaning freedom fromtorture or arbitrary arrest, imprisonmentand execution. These are the necessaryprerequisites to free and fair elections atconstitutionally stipulated intervals, thehallmarks of a democratic political order.

Since the American seizure of the Phil-ippines from imperial Spain in 1898, pro-moting democracy and human rights hasbeen among the principal stated goals ofU.S. foreign policy. The policy has hadsignificant successes, most notably thetransformation of post-World War H Ger-many and Japan through military occupa-tion from vicious, aggressive, authoritar-

86

ian (in the case of Germany, totalitarian)states into strongly rooted, thriving de-mocracies that today are among the prin-cipal pillars of the liberal internationalpolitical and economic order.

There have been other successes aswell. In a 1991 book, The Third Wave,Harvard political scientist Samuel P. Hun-tington analyzed the processes that dur-ing the period 1974-90 resulted in a sub-stantial increase in the world's number offunctioning democracies. He concludedthat U.S. policyreinforced by what hecalled "demonstration effects or snowball-ing"was an important factor in the caseof most of the large number of LatinAmerican states that made the transitionfrom authoritarian dictatorships to civil-ian democracies. And U.S. policy was aless essential but nonetheless contribut-ing factor to the emergence of democra-cies in the Philippines, Portugal, Poland,South Korea and Taiwan. For the evenmore significant (and more unexpected)transformation in Eastern Europe, Hun-

GREAT DECISIONS I995 83

PROMOTING DIMOCRACY

tington gave most of the credit to formerSoviet president Mikhail S. Gorbachev(1985-91), who made clear that the RedArmy would no longer intervene to keepCommunist regimes in power.

The U.S. has employed a spectrum ofinstruments to further its preferred poli-cies. At the level of declaratory policycomes verbal condemnation by State De-partment or White House spokespersonsor critical treatment in the annual coun-try-by-country human-rights reports thatCongress requires from the State Depart-ment. Next come economic sanctions.These include suspension or reduction ofeconomic assistance by U.S. governmentagencies, revocation of bilateral tradeconcessions, and votes by American rep-resentatives blocking loans by the WorldBank and other multilateral financial in-stitutions. Such measures have extendedto total economic embargo of offendersconsidered particularly egregious. Thesehave been multilateral when possible,unilateral when necessary.

Military interventionThe most drastic instrument, of course, isthe use of outright military interventionto remove particular regimes (e.g.,Grenada in 1983, Panama in 1989, Haitiin 1994). But military measures also in-clude demonstrations of force (e.g.,stationing warships off the DominicanRepublic in 1978 to induce a fair votecount; low overflights by jet fighters tosignify support of the elected Aquino gov-ernment against an attempted militarycoup in the Philippines in 1989), and armsaid, training and intelligence assistance tolocal counterinsurgency campaigns (e.g.,El Salvador in the 1980s). In Nicaragua,the Reagan and Bush Administrationsgave "covert" (but, in fact, overt) aid toanti-Communist insurgents seeking towrest control of the country from theMarxist-leaning Sandinista government.

Huntington makes clear that Americanefforts to foster democracy have beenfacilitated by the worldwide rejection, es-pecially during the late 1980s and early1990s, of state control of national econo-mies and statist solutions to economicproblems. In country after country au-thoritarian regimes ceded power to demo-cratic successors, acknowledging that theyhad failed to solve the problem of how tomake their economies grow and that pub-lic resentment was making it increasinglydifficult for them to govern. Therefore itis impossible to show conclusively that,

84 GREAT DECISIONS 1995_L

in any given instance, U.S. policy and ac-tions were the principal cause of changesthat might have occurred in any case. InNicaragua, for example, it was not U.S.aid to the contras as such that brought theruling Sandinistas to agree to open, moni-tored elections. Rather, it was the dryingup of what had once been a stream ofSoviet support, both military and eco-nomic. No other government had eitherthe interest or the financial capability topick up Moscow's Nicaraguan burden.The contras had not won (indeed, they hadlargely been defeated), but they did notneed to win. The Sandinistas were verymuch alone. One might wonder whether,had the contras won a resounding mili-tary victory, they would have allowed theSandinistas to participate in any follow-on elections. Successful insurgents sel-dom make good democrats.

Cold-war compromisesNot only is it difficult to say for certainthat U.S. policies have been decisive inany given instance of democratization,but it should also be pointed out thatWashington policymakers have some-times paid only lip service to that goal.For reasons ranging from internationalgeopolitics to interest-group politics athome, Administrations have on occasionbacked away from taking action thatwould bring effective sanctions to bearagainst governments that have been fla-grant violators of human rights.

Moreover, in some instances Ameri-can policy not only has not promoted de-mocracy but has undermined it and hasled directly or indirectly to the overthrowof governments with a promising recordof respect for human rights and demo-cratic procedures. The Central Intelli-gence Agency (CIA) was deeply impli-cated in the 1953 coup by Iranian armedforces that removed Prime MinisterMohammad Mossadeg from power. Ayear later, in Guatemala, the CIA stage-managed the ouster of President JacoboArbenz. In 1964 Washington supportedthe overthrow of the democraticallyelected Brazilian government of JoaoGoulart. It backed a military coup in Uru-guay in 1973 and, that same year, themilitary coup against Allende in Chile.And the CIA gave financial support toPanama's dictator, Manuel Noriega, al-though it knew he was deeply involved insmuggling drugs into the U.S.

These episodes were, of course, prod-ucts of the cold war, which exerted a pro-

8 7

found influence on U.S. foreign policy.Through them all and many others ran acommon thread. Policymakers feared thata given leader's programs or allianceswould threaten "stability" in the leader'scountry or region, and that in order to re-tain power he or she would become toodependent upon support from local Com-munistsultimately, perhaps, upon theSoviet Union. Washington would take nochances.

Successive presidents and their senioradvisers therefore found it possible tooverlook the fact that some of America'sallies in the "free world" were as hostileto ordinary notions of liberty as anymembers of the Soviet camp. The U.S.thus tolerated abuses of its principles toprotect what it held to be embryonicdemocracy, such as South Korea's orSouth Vietnam's. Meaningful and fairelections could come later, as indeed theyfinally did come in South Korea in 1992.

Policymakers rationalized their depar-tures from principle by accepting cynicalpromises of future good behavior on thepart of clients, and by contending that atleast right-wing authoritarianism, as inSouth Korea, South Vietnam or Chile, was"reversible," whereas once a Communistregime came to power it would neveragain allow genuine freedom of electoralchoice. "There are three possibilities,"historian-biographer Arthur Schlesingerquotes President John F. Kennedy as say-ing at the time of the assassination of theDominican Republic's unsavory longtimedictator, Rafael Trujillo, in 1961. Theywould be, "in descending order of prefer-ence: a democratic regime, a continuationof the Trujillo regime, or a Castro regime.We ought to aim at the first, but we reallycannot renounce the second until we aresure we can avoid the third."

Considerations such as these infusedAmerican cold-war policy throughout thedeveloping world, not only in LatinAmerica. Presidents and their adviserswere well aware, however, of the gap be-tween their rhetoric, emphasizing democ-racy, and the realities of their policies.Often the foreign assistance legislationthat came from Congress seemed to pro-vide stern sanctions against regimes thatviolate human rights. But in reality thelegislation left the Administration in con-trol: if the Department of State certifiedthat the government in question was re-specting human rights and makingprogress toward democratic reforms, theaid would continue to flow.

_

PROMOTING DEMOCRACY

Games nondemocrats playAdministrations and Congress alike thusseized upon any indicators they couldfind that seemed to support the conten-tion that the U.S. was aiding fledglingdemocracies. The indicator that was mostfamiliar to the American people and tomembers of Congress was the occurrenceof competitive elections, wnich rankedhigh among the litmus-paper tests thatdistinguished the free world from itsCommunist adversaries. The latter heldelections not to offer voters a choice butto induce them to ratify the party's singlelist of candidates. American diplomats,from Presidents down to junior politicalofficers in embassies, therefore put con-siderable effort into persuading clientgovernments to take the risk of holdingcompetitive elections.

Thus, Administrations focused thespotlight of publicity on the fact thatelections had occurred, and held them upas proof that the recipients of U.S. aidwere making progress on the road to de-mocracy. For their part, clients oftenmade the pleasant discovery that theycould stage and win elections, receiveaccolades and continued aid from Wash-ington for doing so, ana still maintain thebasic features of the structure of repres-sion that kept them in power.

Occasionally, as in South Vietnam'selection of 1967, regimes would resort toflagrant vote rigging. More often, votecounting would be relatively honest: in-ternational observers would often bepresent to certify that it was. But the deckwould be stacked from the outset in thegovernment's favor as major oppositionparties were either kept off the ballot al-together or else allowed to campaignonly under the weight of severe restric-tions. Sometimes, as in El Salvador'selection of 1982, the mechanics of votingmade casting a secret ballot impossible.On more than a few occasions, opposi-tion parties decided not to participate inelections in protest against either cam-paign restrictions or government unwill-ingness to guarantee the physical safetyof their candidates.

On such occasions opposition move-ments often had no viable alternatives;they therefore played right into govern-ment hands. The very fact that a some-what competitive election had takenplace (some tame opposition groupscould always be found and placed on theballot) was often sufficient to mollify the

rir5--""

,

°

DEMOCRACY DEFENDED: Haitian President Jean-Bertrand Aristide is greeted in Pot: -cu-Princeupon his return from three-year exile by U.S. Lt. Gen. Hugh Shelton.

U.S. Congress, the audience that mat-tered most, so as to cause itsometimesonly grudginglyto vote not to cut off .

the economic and military assistanceupon which the client government fed.

In the instance of El Salvador duringthe Reagan Administration, this processreached absurd limits. A compromise be-tween congressior,a1 supporters and op-ponents of continued aid to the right-wing Salvadoran regime required the De-partment of State to certify every sixmonths that the government (whoserecord of respect for human rights was, tosay the least, mixed) was making contin-ued progress toward democratic reforms.Although Secretary of State George P.Shultz deeply resented such congres-sional micromanagement, he duly pro-vided the stipulated certification. Formost members of Congress, wilt) caredfar more about their own electoral pros-pects than about those of politicians inCentral America, the compromise wasideal: it enabled them to satisfy the hard-line cold warriors among their constitu-ents by endorsing tough military mea-sures against Communist-supportedinsurgents, while at the same time satis-fying constituents whose main concernwas democracy and human rights.

Post-cold-war dilemmasThe end of the cold war meant the endof charades such as these. Speaking be-fore a university audience on Septcm-

ber 21, 1993, President Clinton's na-tional security adviser, Anthony W.Lake, used a graphic image to charac-terize the past: "During the cold war,even children understood America's se-curity mission. As they looked at thosemaps on their schoolroom walls, theyknew we were trying to contain thecreeping expansion of that big, red blob.Today...we might visualize our securitymission as promoting the enlargementof the "blue areas" of market democra-cies. The difference, of course, is thatwe do not seek to expand the reach ofour institutions by force, subversion orrepression."

Lake was perhaps too kind to his pre-decessors, few of whom had shrunk fromrecommending the overt or covert useof American power to keep one or an-other Third World regime aligned withthe West. But he succinctly character-ized the new policy environment inwhich the Clinton Administration founditself: not for the decade, perhaps notever, would maps again metaphoricallydepict the potential threat of the "big,red blob." The tasks of American for-eign policy were thus sharply differentthan they had been during the heydayof the cold war.

The Clinton Administration has ac-knowledged this transformation in all itspublic statements on U.S. security policy.Typical was the introduction to the 1994version of the annual report to the Con-


PROMOTIND DEMOCRACY

gress on national security strategy. "Thedissolution of the Soviet empire has radi-cally transformed the security environ-ment facing the U.S. and our allies," itstated. "The primary security imperativeof the past half centurycontainingCommunist expansion while preventingnuclear waris gone."

There will, of course, be new threatsto American secunty. But only some willcome from the purposeful actions of otherstates. Others will be the results of globaltrends, such as environmental degrada-tion, resource depletion, epidemics andthe like. For these new threats the tradi-tional elements of national security policywill have little relevance. Nor in manyinstances of "old-style'. threatsthoseresulting from the resort to violence bygovernments or revolutionary move-mentswill U.S. security be much en-hanced by channeling more resources tothe armed forces. Instead, greater safetywill come from promoting democratiza-tion. The report to Congress stated: "Allof America's strategic interestsfrompromoting prosperity at home to check-ing global threats abroad before theythreaten our territoryare served by en-larging the community of democratic andfree-market nations. Thus, working withnew democratic states to help preservethem as democracies committed to freemarkets and respect for human rights, is akey part of our national security strategy."

The Administration thus seems tohave accepted without reservation the ar-guments put forward by Michael Doyleand other political scientists. Securityadviser Lake again echoed those argu-ments in an address to the New Yorkbased Council on Foreign Relations onSeptember 19, 1994, when he stated:"We are not starry-eyed about the pros-pects for spreading democracy; it will notsoon take hold everywhere. But we knowthat the larger the pool of democracies,the better off we will be. Democraciescreate free markets that offer economicopportunity, and they make for more reli-able trading partners. They tend not toabuse the civil and political rights of theircitizens. And democracies are far lesslikely to wage war on one another. Civi-lized behavior within borders encouragesit beyond them. So it is in our interest todo all we can to enlarge the communityof free and open societies, especially inareas of greatest strategic interest, as inthe former Soviet Union."

Accepting and elaborating upon_

86 G R E A T I.) E C I S I () N I 9 9 5

academic arguments about the behaviorof liberal democracies is one thing.Inducing real-world regimes to move inmore democratic directions is differentand much more difficult. Moreover, in itsinitial effort to support liberalization anddemocratization, the Clinton Administra-tion stumbled over its own rhetoric.Clinton had campaigned for the WhiteHouse contending that the Administrationof President George Bush had been lax inemploying U.S. economic power toinduce reforms by other governments.China was at the top of Clinton's list ofoffenders. He therefore endorsed the pro-posal that unimpeded access to Americanmarkets for Chinese goods ("most-favored-nation" treatment) should bemade conditional upon improved Chinesebehavior regarding human rights, and

placed China on what amounted to ayear's probation.

By May 1994 the year had passed andChinese behavior was essentially un-changed, but Clinton nevertheless re-newed China's most-favored-nation sta-tus. He did so because Beijing had threat-ened to retaliate by sharply reducingChina's large purchases of Americangoods and services, and public opinionsurveys showed Americans to be muchmore concerned about the effects of sucha boycott on the U.S. economy than theywere about the status of Chinese politicalliberty. The President vowed to continuepressing the Chinese leadership to de-mocratize China's political processes, butsaid that his Administration would nolonger link the issue with that of tradesanctions.

Is Asia different?N THE COURSE of these debates regard-ing the proper stance toward China,

Americans were frequently reminded thatother Asian states did not support effortsto lean on China for what Washingtonconsidered to be insufficient democracy.Too much tolerance of dissent, said manyAsian voices, would undermine the abil-ity of states to maintain domestic order.Then there would be anarchy and, almostinevitably, a harsh authoritarian response.Such warnings had long come from no-table friends of the West such as LeeKuan Yew, the architect of Singapore'sdynamic growth and for years its (rela-tively) benevolent prime ministerial dic-tator. "I believe that what a country needsto develop is discipline more than de-nlocracy," Lee told a Philippine audiencein 1992. And he continued: "The exuber-ance of democracy leads to indisciplineand disorderly conduct which are inimi-cal to development." Malaysia's primeminister, Mahathir Mohamad, was so an-gered by U.S. proposals linking eco-nomic access to human rights that heboycotted the Asia-Pacific EconomicCooperation summit meeting that Clintonhosted in Seattle, Washington, in No-vember 1993. Whereas governments inevery other region of the world have atleast rhetorically embraced the goal ofenlarging the sphere of democracy, thatis not the ease in Asia.

Some Asian commentators contendthat liberal democracy is an institutionalexpression of Western values, emphasiz-ing the role of the individual, whereasmany Eastern societies have at their corea value system that emphasizes the groupand the community. In that cultural con-text, they say, civil and political rightssuch as freedom of speech and assemblydo not have the same connotations theyhave in the West; indeed, they mighteven create divisions where none nowexist between leaders and led. A seniorSingapore diplomat wrote in the Fall1993 issue of Foreign Policy: "As the in-ternational distribution of power andwealth changes, the West...should ask it-self whether many of its persistent prob-lems and its lack of economiccompetitiveness...are not in part due toits tendency to transform every social is-sue into an uncompromising question of'rights' and place the claims of the indi-vidual and special interests over those ofsociety. There are grounds to questionwhether, viewed against the continuingmarch of history, the Western type of'democracy' provides optimal societalarrangements or even whether it can en-dure in its present form."

To such arguments many Westernscholars, publicists and public figures re-ply that democracy is a means, not anend. These commentators reject the con-

PROMOVNG DEMOCRACY

tention that, if left to themselves, Asiansmight shun democracy as divisive. Theissue, they contend, is simple and clear. Itcomes down to the proposition thatnearly all persons, no matter their prov-enance, would prefer to be able freely todebate and then express a choice regard-ing who is to lead them rather than not beable to do so.

Seemingly contradictory votes in the1993-94 session of the United NationsGeneral Assembly showed that ThirdWorld states are schizophrenic on thissubject. A resounding majority called forthe establishment of a UN office to pro-vide states with assistance in runningelections, with a trust fund to help poorerstates pay for such assistance. But asmaller majority passed a resolution pro-claiming "respect for the principles ofnational sovereignty 'tnd noninterferencein the internal affairs of states in theirelectoral processes." The latter are solelyan internal concern; "there is no universalneed" for the UN to supply any electoralassistance.

Ever since the massacre of demon-strating students in Beijing's TiananmenSquare in June t989, democracy and hu-man rights halfway around the world inChina had been a high-profile issue forWashington. For the Clinton Administra-tion, which took office in January 1993,the issues of democracy in Haiti andCuba loomed equally large. The twocountries were very different in their his-tories and ethnic makeup. But the prob-

lems they posed for the U.S. governmentin 1994 were the same: citizens of bothcountries were fleeing by the thousandsin makeshift, scarcely seaworthy boats,hoping to escape arbitrary and (especiallyin the case of Haiti) brutal regimes and tofind economic security in the U.S. Just astelevision had brought the Chinese dem-onstratorsand their eventual tragicfateinto American living rooms, so italso brought images of Cuban and Hai-tian "boat people" risking their lives inthe Caribbean.

Caribbean dilemmasCuba and Haiti appeared on the "democ-racy agenda" of the White House be-cause of the assumption that bringingconstitutional democratic government toboth countries is a necessary conditionfor stoppingand, ideally, reversingthe outward flow of refugees. (It mightbe noted that during the exodus of 1994,U.S. government policy toward Cubawas coordinated by the National SecurityCouncil staff member whose title is Se-nior Director for Democracy.) In the caseof Cuba, the policy problem is to hastenthe departure from office of PresidentFidel Castro while making sure that hissuccessors, who are likely to come fromFlorida's anti-Castro Cuban community,will adhere to liberal democratic normsand not simply substitute their own brandof right-wing authoritarianism forCastro's left-wing variety. In the case ofHaiti, the problem was to restore to office

47

A MACH Of SOVellkarf? Humanitarian intervention by the UN in the southern Sudanprovides food. health care, water and other basic supplies.

4

President Jean-Bertrand Aristide, thewinner by a landslide of Haiti's firstdemocratic election, who had been de-posed by a military coup after holdingoffice for only nine months in 1991, andthen to make sure that Aristide continuesto follow constitutional democraticnorms. With the exception of thosemonths, neither country had ever knowndemocratic government.

The long-run prospects for Cuba areundoubtedly brighter than those for Haiti,however. Cuba is a potentially rich coun-try with a relatively skilled, educatedwork force. It has been impoverished bymore than three decades of Castro's stat-ist economic policies augmented by anembargo imposed by the U.S. OnceCastro departs and the embargo is lifted,Cuba's economy is likely to grow rap-idly. By contrast, Haiti is desperatelypoor, with too many people and too fewresources. It is not surprising that its rul-ers have always feared that if they did notrule with harsh and arbitrary methodsthey would be swept away.

In Haiti, especially, but also in Cuba,the task of maintaining democracy will bemade more difficult by the absence of anyindigenous democratic tradition or senseof the limits of legitimate action by a stateapparatus representing the newly enfran-chised members of society. The same istrue in the case of the much more compli-cated and much more important states thathave emerged from the ruins of the oldSoviet empirespecifically the 15 formerrepublics of the U.S.S.R. itself and the sixnations of Eastern and Central Europe thatuntil 1989 were Moscow's satellites.Their geopolitical significance is obvi-ously much greater than that of the twoCaribbean republics. American officialstatements from Presidents on down haveconsistently linked democratization inthese countries with the cessation of cold-war hostility and mistrust. The surest guar-antee of world peace, American leadersemphasized, would be success in trans-forming these states, notably Russia, intofunctioning constitutional democracies.

Providing aid and know-howTherefore promotion of democracy inwhat was once called "the East" becamea central strand of U.S. foreign policy.That effort took two forms. One was theprovision of economic aid, much of itearmarked for underwriting the painfulprocesses of privatization which, withvarying measures of seriousness, was the

. -(JKLAT DECISIONS IV95 87

PROMOTING DEMOCRACY

declared goal of all the governments in-volved. Their financial needs were enor-mous. Western (not merely American)responses, in the form of bilateral trans-fers directly from governments andthrough international financial institu-tions, were not insignificant, but they fellfar short of the sums the recipient gov-ernments had requested. In the case of theU.S., shortfalls have been compounded bya Congress unwilling to appropriate whatthe Administration has wanted, especiallyfor assistance to Russia. To complicatematters further, much of the funds thatwere transferred turned out to be wasted,as well-entrenched economic managerscontinued doing what they had long doneunder communismsubsidizing ineffi-cient industries, a process made even morewasteful by the fact that many productsof their factories were unsalable in thenew, astringent market conditions inwhich they suddenly had to compete.

The second form of the policy hasbeen a large-scale and continuing effortto pass on Western know-how. Some ofthe knowledge transferred has pertaineddirectly to the processes of setting up andrunning liberal, constitutional democra-cies. Thus there has been extensive in-struction in constitution writing, lawmaking, tax systems, the entire elei:toralprocess from developing a legal frame-

work to the nuts and bolts of runningcampaigns and casting and countingvotes, civilian control of the armedforces, the workings of free but respon-sible mass media, and the like. Otherefforts have aimed at providing trainingin the management of a market-driveneconomy. These include the creation andoperation of modern banking systemsand securities markets, conversion ofindustrial plants from military to civilianproduction, marketing strategies, theorganization of labor unions and the like.

Few of the many persons involved inproviding this advice come from officialgovernment agencies. Instead, they comefrom private nonprofit organizationsranging from old and established univer-sity-based institutes (e.g., Harvard's JohnF. Kennedy School of Government,which runs a number of programs tostrengthen Russian democracy) to laborunions, human-rights organizations, pro-fessional associations, foundations, andad hoc committees formed expressly totake on a task for which one or another oftheir members, or perhaps a local govern-ment agency or citizens' organization,sees a need. The underlying purpose hasbeen nothing less than the creation oftrue civil societies in settings in whichevery structure but the state had previ-ously been impoverished.

Paying for democracyMUCH OF THE. FINANCING used tosupport democratic tendencies in

other societies now comes openly fromthe U.S. government. This significantchange occurred in the early 1980s. Be-fore then, during most of the cold war, itwas the CIA that covertly funneled aid topolitical parties, trade unions and othermass organizations, and to individualpoliticians in a number of countries.Japan's Liberal Democrats and Italy'sChristian Democrats were only the mostprominent of many recipients of theagency's largesse. As with so many cold-war programs, while the rhetoric used tojustify them was that of promoting de-mocracy, the leading value they sup-ported was anticommunism. The purposeof U.S. aid, it was often argued, was tocounterbalance covert Soviet support ofparties and movements on the far left, In

88 G R E A T D E C I S I O N S I 9 9 5

pursuit of that supposed balance, Ameri-can aid went to some organizations andindividuals that were decidedly anti-democratic. Covert transactions invari-ably risked embarrassing both partners,particularly the recipients of secretAmerican support.

By contrast, in Germany the threeleading partiesChristian Democrats,Social Democrats and Liberalshavelong given overt financial support to theircounterparts elsewhere in Europe and insome developing countries. The principallabor unions do the same. Moreover, alarge portion of the money used for suchpurposes comes from the German state.Other West European polities have simi-lar programs. To American political par-ties, the idea of aiding foreign politicalorganizations is in itself foreign, amongother reasons because the Democratic

9l

and Republican parties do not have ideo-logical counterparts, and therefore noclose connections with European parties.Nor have they funds to spare for suchpurposes.

A sense that the U.S. was needlesslydisadvantagedthe Soviets had, ofcourse, long funded foreign Communistpartiesled a diverse group of congres-sional and labor leaders in the late 1970sand early 1980s to press for the foundingof what in 1984 would become the Na-tional Endowment for Democracy(NED). Although the NED receives itsfunds on an annual basis from the federalgovernment, it was organized as a privatefoundation insulated from direct govern-mental control. Under the NED are fourindependent subsidiaries: the NationalDemocratic Institute for InternationalAffairs, affiliated with the DemocraticNational Committee; its Republicancounterpart, the International RepublicanInstitute; the Center for International Pri-vate Enterprise, affiliated with the U.S.Chamber of Commerce; and the FreeTrade Union Institute of the AFL-CIO.The NED directly supports someprojects, such as a campaign by the op-position in Nicaragua to register votersbefore the 1990 election that drove theSandinistas from power. But most of itsfunds have gone to its four subsidiaries,who have used them to strengthen for-eign parties and other mass organizationsand to teach them the mechanics of orga-nizing and financing political parties,running elections and operating an effec-tive parliamentary government, as well assupporting activities such as voter regis-tration and election monitoring by inter-national observers. For their part, the re-cipients of this aid and advice have foundthat overt approval by an American partyor labor union tends to be an electoralasset, rather thanlike covert connec-tions when discovereda handicap.

Supporting democratsWhat was new about the NED and itssubsidiaries was not only their hybridnature as state-supported but not state-controlled political-action agencies, butespecially their ability overtly to embraceparticular parties or candidates in foreignpolitical contests. That focused embracecontrasted sharply with the generalizedapproach of the U.S. Agency for Interna-tional Development (AID). Promotingdemocracy had been part of its missionsince the 1960s. During the 1970s a se-

PROMOTING DEMOCRACY

ries of amendments to the Foreign Assis-tance Act, AID's charter, forbade theagency from assisting governments thatviolated human rights. In December1990, with the cold war fast becominghistory, AID launched a "Democracy Ini-tiative" aimed at assuring that "withineach region of the world, allocations ofAID funds to individual countries willtake into account their progress towarddemocratization." AID would therefore"support democratic political develop-ment, helping to establish enduring po-litical practices, institutions and valueswhich mobilize participation, channelcompetition, respect basic human rightsand promote open, lawful and account-able governance."

Translated into actual practice, theseambitions mainly took the form of a vari-ety of programs of education, advice andpractical training covering just about ev-ery aspect of the constitutional gover-nance of modern societies. For these pro-grams, AID drew primarily not upon itsown employees, but upon academic ex-perts, publicists and other specialists.Moreover, AID also supplies most of thefunds used by the NED and its four sub-sidiary institutes. All such funds are vul-nerable to the vagaries of congressionalpolitics, but it is likely that funneling themajor share through AID assures some-what greater stability.

The price of democracyIt is difficult to get even a rough figurefor the U.S. government's annual spend-ing on what are called "democracyprograms." That is because accountantsdiffer on how much of the budget ofagencies like the U.S. InformationAgency (USIA) should be included.Much of the material in USIA librariesabroad, and much of the content ofbroadcasts by the Voice of America,might be regarded as promoting democ-racy. The same is true regarding foreignstudents and professors who come at thefederal government's expense (throughFulbright grants, for instance) to studyand conduct research in the U.S., orAmericans who go abroad to teach. Agiven individual might have come tostudy theoretical physics. But likemany Chinese visitors, for instanceshemight return home determined to helpbuild there the kinds of democratic insti-tutions she saw close-up in the U.S. Howmuch of her stipend should be regardedas democracy funds?

ABC'S OF DEMOCRACY: Students in School 1235 in Moscow, Russia, prepare to stage a mockelection.

The same ambiguity is present even intrying to calculate the expenditures ondemocracy programs of AID alone. Thetraditional function of the agency is tosupport economic development. But so-cial scientists and practitioners alike in-creasingly acknowledge that develop-ment has many aspects, and that eco-nomic growth has multifold causes.Much of AID's spending on develop-ment-related programs in Eastern Europeand the former Soviet Union thereforegoes to provide training and resourcematerials relating to the wide range ofactivities that make governmental pro-cesses more professionally competent,open and accountable to the public--inshort, toward strengthening the practicalattributes of democracy.

Many other AID "development" pro-grams have important but frequentlyoverlooked "democracy" components.The agency's budget for activities la-beled "democracy programs" in fiscalyear (FY) 1994 was an impressive $338million, more than tenfold the $30 mil-lion that went to the NED. (Of the latter'sfunds, 80% were passed on to its foursubsidiary organizations. The remainderwent for projects the NED initiated di-rectly.) Meanwhile, the General Ac-counting Office has been examining thebudgets of all federal agencies in an at-tempt to arrive at a full reckoning of allthe activities that might plausibly be in-cluded under the heading of democracyprograms, and has produced as an initialestimate a total sum of $900 million for

92

FY 1993. It continues to work on refiningthat estimate.

What works?If, in 20 years or so, Slovakia or Vietnamorthe biggest prize of allRussia itselfis a thriving democracy, observing dueprocesses of law and respecting the fullWestern panoply of human rights, will ithave been because of seeds planted byseminars in constitutionalism held inBratislava and Hanoi and Moscow byAmerican academic institutions? Thequestion is absurd. But it points up thedifficulties involved in crediting outsideinfluences for the complex political, psy-chological and moral changes involved ina society's transition to constitutionaldemocratic governance. The only surecure is military occupation, which"worked" in the notable cases of post-1945 Germany and japan. It seems tohave worked also for the tiny island re-public of Grenada, which has remainedon New York-based Freedom House'slist of "Free" countries since U.S. troopsevicted its Leninist government in 1983.

The military occupation of Haiti thatbegan in late September 1994 may alsowork, although it is too soon to tell. ButU.S. Marines occupied Haiti from 1915to 1934 and did not successfully implantdemocracy. Nor did they do so whenthey occupied Nicaragua from 1926 to1933. There they closely supervised theelections of 1928 and 1932. But one sen-tence in Bryce Woods' classic, The Mak-ing of the Good Neighbor Policy (1961),

- -GREAT DECISIONS 1995 89

PROMOTING DEMOCRACY

says it all: "The Guardia, trained by theMarines to maintain internal peace andassure free elections in Nicaragua, wasplaced in command of General AnastasioSomoza." In June 1935 Somoza over-threw the winner of the free 1932 elec-tions and established a family dictator-ship that lasted 44 years.

Military occupation is no longer aremedy readily applied. The budget costsof even small-scale operations by U.S.forces are high. The political costs to asitting President are prohibitive if manyAmerican lives are lost. That an opera-tion is sanctioned by the UN SecurityCouncil makes little difference. Whatmatters politically is that the nation's vi-tal interests should appear to be at stake.During the long years of cold war, whenthe Soviet threat was alive and well anddemocracy was a code-word for anticom-munism, Presidents successfully arguedthat vital interests were engaged nearlyeverywhere. Now some politicians makea plausible case that vital interests are atstake virtually nowhere, and that evenone American life lost in an effort tobring order to most corners of an unrulyworld is too high a price.

If military intervention is costly, semi-nars in constitutionalism are cheap. Soare the scholarships and fellowships thatbring to the U.S. for varying periods ofstudy foreign citizens ranging from un-dergraduates to distinguished profession-als, and it is arguable that nothing is aseffective in conveying an understandingof the workings of our complex demo-cratic political system. And so also are allthe other activities that are the day-to-dayfare of the NED and its affiliated insti-tutes. They are all part of a dense, con-tinuing and sometimes cacophonous glo-bal conversation about the norms, endsand means of governance. The conversa-tion is worth having and worth the ex-pense of carrying it on, whether or not asingle additional state joins the ranks ofthose unshakably committed to liberal,constitutional democracy. For it is a con-versation that stretches and clarifiesAmericans' own minds as much as itdoes the minds of their interlocutors.

Promoting democracy is an endeavorbased upon a set of assumptions that areall ultimately unproved. One is that theeffort is worth making: that each addi-tional constitutional democracy enhancesthe safety and well-being of the others. Aclosely related assumption is that thebenefits of seeding and nurturing democ-


racy are worth the costs. And another isthat the U.S. knows what to do and howto do it. In this respect, promoting de-mocracy is like all other great enterprises.Those that rest upon no unproved as-sumptions and have no loose ends areseldom worth the investment of time andtreasure, to say nothing of lives.

U.S. policy optionsJ 1. Now that the cold war is over,the yardstick against which all U.S.foreign policy decisions should be mea-sured is whether a given course of ac-tion will promote democracy abroad.

Pro: With the cold war ended, theU.S. faces no significant security threat.It can therefore afford to give highest pri-ority to the value-, that gave rise to itsown campaign for independencethepresumption that all persons should enjoyequal status before the law and shouldparticipate on such a basis in the choiceof their leaders. In doing so, the U.S.would also enhance its own security: theevidence is persuasive that liberal de-mocracies do not make war on one an-other.

Con: Russia and the other republicsof the former Soviet Union are friendsrather than threats today. but there con-tinue to be many lesser threats to U.S.national interests. Assigning the promo-tion of democracy the highest priority inforeign policy is a luxury the U.S. stillcannot afford and needlessly placesdecisionmakers in a straitjacket. The U.S.will continue to need friendly relationswith regimes whose methods of govern-ing are anathema to it. "Realist" analystsare correct: As long as separate sovereignstates exist, it will still be a dog-eat-dogworld out there, and U.S. foreign policymust reflect that fact.J 2. Under certain conditions, U.S.forces should intervene to rescue apopulation from genocide or otherdisaster brought on by an authoritar-ian regime.

Pro: Military intervention is not aninstrument to be used lightly, but therewill continue to be situations in whichthe following set of conditions obtains: 1.A regime's violations of human rightseither by omission or commissionarevery widespread and egregious. 2. Theoffending regime is judged not capableof inflicting grave losses en interveningforces. 3. The intervention has been ap-proved either by the UN Security Coun-cil or by the relevant regional organiza-

93

tion. In such circumstances, interventionis likely to be both successful and politi-cally tolerable.

Con: Even when all these conditionsare met, military intervention is likely tobe a very chancy enterprise. The dangeris not simply that intervening forces willsuffer politically unacceptable losses, butthat their intervention will produce per-verse results, such as the substitutionafter an intervalof one set of cruelleaders for another. Prudence would thusdictate reserving the military instrumentfor circumstances in which U.S. securityis directly and seriously threatened.J 3. The U.S. government should notinterfere in the politics of other na-tions.

Pro: Americans would not like it ifforeign governments channeled fundsthrough captive foundations in order tosupport candidates in U.S. elections. In-terference is interference, whether thefunds involved come directly from for-eign governments or are "laundered"through purportedly independent founda-tions such as the National DemocraticInstitute and the International RepublicanInstitute.

Con: For the U.S. to abstain from apractice that is commonplace todaywould place it at a disadvantage. More-over, U.S. programs to promote democ-racy abroad are today open and freelyacknowledged. If the recipients thoughtthat identification with U.S. fundingsources were to their disadvantage, theywould not agree to accept the support.J 4. The resources the U.S. now de-votes to programs for the promotion ofdemocracy abroad are inadequate andshould be increased.

Pro: The diverse activities supportedby the federal government's "democracyprograms" are bargains compared withjust about anything else government doesand should be increased. Even if it cannotbe proved that all are effective, they areworth doing for their own intrinsic value.Most contribute as much to the educationof Americans as they do to that of foreignnationals.

Con: There may indeed be a case forincreasing the amount of funds devotedto democracy programs, but thus far ithas not been made. The U.S. simply doesnot know enough about what "works"and what does not. If, for example,Americans believe that a given programcontributes to their education, the U.S.should support it as such.

PROMOTING DEMOCRACY

DISCUSSION'QUESTIONS

1. How should one define "democracy"?What institutions and attributes must apolity possess generally to be acknowl-edged as a constitutional democracy? Isthis a universally applicable definition, oris it tied to a particular culture?

2. Are critics correct when they assertthat U.S. efforts to promote liberaldemocracy worldwide are an example ofcultural imperialism in which the U.S. isattempting to impose its values onothers?

3. Is there likely to be a tension betweenAmerica's "human-rights agenda" and its"democracy agenda" in dealing with for-eign governments? Why or why not?

4. What, in your opinion, is the most

persuasive explanation of the phenom-enon that liberal democracies do notmake war on one another? What explana-tions do you find least persuasive?

5. Should U.S. political parties acceptgovernment funds for use in supportingpolitical parties and other organizationsof their choice in other countries? Whyor why not?

6. How should American values bereflected in American foreign policy?

A ID

Atwood, J., Strategies for Sustainable Development.Washington, D.C., U.S. Agency for International Development,March 1994.47 pp. $6.11 (plus shipping and processing). Acomprehensive statement indicating how the promotion ofdemocracy relates to other AID policies and programs.

Carothers, Thomas, "The NED at 10." Foreign Policy, Sum-mer 1994, pp. 123-38. An examination of the National Endow-ment for Democracy on its 10th birthday.

"Human Rights: A Debate." Foreign Policy, Fall 1993, pp. 24-51. Aryeh Neier, in "Asia's Unacceptable Standard," rebutsBilahari Kausikan's arguments in "Asia's Different Standard."The former is the longtime executive director of Human RightsWatch, a U.S.-based advocacy organization, and the latter is inSingapore's Ministry of Foreign Affairs.

Huntington, Samuel P., The Third Wave: Democratization inthe Late Twentieth Century. Norman, University of Okla-homa Press, 1991. 384 pp. $17.95 (paper). A distinguishedscholar of politics discusses the causes and consequences of theworldwide trend toward democratization.

Lowenthal, Abraham F., ed., Exporting Democracy: TheUnited States and Latin AmericaThemes and Issues. Bal-timore, Md., Johns Hopkins University Press, 1991. 312 pp.$13.95. A comprehensive set of essays on the region that hasseen the most sustained involvement by the U.S.

Muravchik, Joshua, Exporting Democracy: FulfillingAmerica's Destiny. Washington, D.C., American EnterpriseInstitute Press, 1992. 259 pp. $12.95 (paper). An objective sur-vey of cold-war and post-cold-war U.S. programs to promotedemocracy abroad, written by a strong advocate.

Smith, Tony, America's Mission: The United States and theWorldwide Struggle for Democracy in the Twentieth Cen-tury. Princeton, N.J., Princeton University Press. 1994. 424 pp.$24.95. A comprehensive examination, through case studiescovering a century and several continents, of American suc-cesses and failures in promoting democracy abroad.

CENTER FOR DEMOCRACY (CFD), 1101 15th St., N.W., Washington,D.C. 20005; (202) 429-9141. a A nonpartisan, nonprofit organi-zation created in 1984 to promote and strengthen the demo-cratic process throughout the world, with emphasis on LatinAmerica and Eastern Europe. The center's activities range fromeducational and legal reform to advice on privatization and set-ting up a business clearinghouse for Americans interested ininvesting in Russia.

94

FREEDOM HOUSE, 120 Wall St., 26th floor, New York, N.Y.10005; (212) 5I 4-8040. a Nonprofit, nonpartisan organizationthat monitors and publishes reports on the state of freedomworldwide.

INTERNATIONAL FOUNDATION FOR ELECTORAL SYSTEMS (IFES), 1 101

I 5th St., N.W., 3rd floor, Washington, D.C. 20005; (202) 828-8507. c IFES is dedicated to analyzing, supporting andstrengthening the election process in emerging democracies.The foundation's resource center serves as an informationclearinghouse for all aspects of systems for administeringdemocratic elections. Its quarterly bulletin, Elections Today, isavailable to the public.

INTERNATIONAL REPUBLICAN INSTITUTE, 1212 New York Ave.,N.W., Suite 900, Washington, D.C. 20005; (202) 408-9450. cThe Republican party's agency for supporting political move-ments and organizations abroad.

NATIONAL DEMOCRATIC INSTITUTE FOR INTERNATIONAL AFFAIRS,

1717 Massachusetts Ave., N.W., 5th floor, Washington, D.C.20036; (202) 328-3136. c The Democratic party's agency forsupporting political movements and organizations abroad.

NATIONAL ENDOWMENT FOR DEMOCRACY (NED), 1 101 15th St.,N.W., Suite 700, Washington, D.C. 20005; Main Number (202)293-9072. Journal Number (202) 293-0300. u Nonpartisan or-ganization, chartered and funded by Congress to support de-mocratization abroad, that serves as a source of funds for sub-sidiaries affiliated with the two major U.S. political parties.Quarterly Journal of Democracy covers democratic move-ments and newly established democracies around the world.

G k I: A T I) I: CISIONS 19 95 91

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TOPIC 1: CONFLICT IN FORMER YUGOSLAVIA

--,:lzewe'r="

Issue B. Would it be appropriate for the U.S. to channel aidfor environmental cleanup through citizen groups?

should: No

65%

21%

Issue A. In its policy toward the former Yugoslavia, the U.S. ,Yes

Avoid future involvement in what is essentiallya European problem.

Support UN humanitarian aid, prosecution ofwar criminals and economic sanctions.

Arm the Muslims and use air power to protectthem from attack.

Mobilize an international ground operation tostop the war in Bosnia-Herzegovina.

Support a new global peace conference on theformer Yugoslavia.

Lead allies in institutional and policy reforms toprevent. future "Yugoslavian."

TOPIC 2: SOUTH AFRICA

YES NO

36% 54%

85% 8%

20% 66%

21% 66%

82% 10%

77% 11%

Issue A. In its economic relations with South Africa, theU.S. should:

Provide grants and loans to jump-start theeconomy.

Encourage international financial institutions toprovide funds.

Encourage the U.S. private sector to trade withand invest in South Africa.

Treat South Africa no differently than any othercountry.

YES NO

34% 54%

83% 11%

87% 7%

53% 32%

Issue C. To combat the environmental damage caused bythe policies of the former Soviet-bloc countries, the U.S.should urge those countries to give the highest priority to:

Reducing air pollution. 10%

Upgrading nuclear reactors to meet international standards.17%

"Denuclearizing" energy-intensive economies. 8%

Eliminating or reducing nuclear weapons and providingfor their safe disposal. 32%

Clfmning up and restoring the quality of internationalbodies of water in and around the former Soviet bloc. 17%

TOPIC 4: TRADE WITH PACIFIC RIM

Issue A. In its trade negotiations with the Pacific Rim, theU.S. should:

YES NO

Pursue freer trade with all economies of the region. 89% 6%

Correct trade imbalances by the use of quotas,voluntary export restraints and other barriers. 33% 55%

Tie trade agreements with China and Indonesia torespect for human rights. 38% 53%

Tie trade with Taiwan to guarantees forintellectual property rights. 54% 31%

Lift the trade embargo on Vietnam. 80% 9%

Issue B. With respect to South Africa's democratic transi-tion, the U.S. should: Issue B. In its trade negotiations with Japan,

should:Provide technical assistance, for example poll watchers. 69%

Play no role, direct or indirect. 19%

TOPIC 3: EX-SOVIET BLOC'S ENVIRONMENTAL CRISIS

Issue A. In order to help the former Soviet-bloc countriesimprove their environmental conditions, the U.S. shouldprovide:

YES NO

Unrestricted grants. 4% 83%

Unrestricted loans. 7% 79%

Grants earmarked for specific programs such asenvironment-friendly technology. 65% 26%

Loans earmarked for specific purposes such asenvironment-friendly technology. 80% 13%

Press for a share of the Japanese market for U.S.exports, industry by industry.

Press for structural changes in the Japaneseeconomy.

Offer to make structural changes in the U.S.economy (e.g.. increase savings and investment)in exchange for structural changes in theJapanese economy.

Not worry about a trade imbalance with Japansince the U.S. has trade surpluses with othercountries.

the U.S.

YES NO

67% 18%

26% 54%

50% 32%

22% 59%

* Results of 35,003 ballots received as of June 30, 1994, andtabulated by Calculogi Corporation of New York City.

n r-GREAT 1)1,CISIONS I 93

:

TOPIC 5: DEFENSE PRIORITIES

Issue A. From roughly $300 billion in 1990, the U.S. na-tional defense budget is slated to decline to just over $250billion (in current dollars, not adjusted for inflation) in1998. This proposed level of defense spending is:

Too much.

Too little.

Just about right.

33%

16%

47%

Issue B. Concerning peacekeeping missions overseas, theU.S. should:

Participate only in concert with the UN or other nations. 81%

Take unilateral action if others refuse to act. 11%

Regarding other aspects of peacekeeping missions, theU.S. should:

Engage in such missions only when U.S.national interests are at stake.

Corn ;;t troops only when peace can beestablished quickly and with little risk toAmerican lives.

YES NO

59% 24%

56% 24%

Issue C. With regard to the size of the post-cold-war mili-tary, the U.S. should:

Retain the 1.6 million-strong "base force"advocated by the Bush Administration. 19%

Further reduce to 1.4 million active-duty troops.as recommended by the Clinton Administration. 42%

Cut back even further in recognition of the fact thatour primary military competitor has collapsed. 27%

TOPIC 6: ARGENTINA, BRAZIL, CHILE

Issue A. In its relations with Argentina, Brazil and Chile,the U.S. should:

Strengthen economic and trade ties, particularlyto increase U.S. exports to the region.

Support the democratization process to ensurethat military dictatorship does not recur.

Provide economic and technical assistance toaddress the growing problem of poverty andsocial needs.

Not intervene in the domestic affairs of thethree countries.

YES NO

90% 4%

81% 10%

74% 18%

66% 22%

Issue B. Should the U.S. seek to expand the North AmericanFree Trade Agreement to include Chile and other. LatinAmerican countries?

Yes

No

TOPIC 7: ISLAM AND POLITICS

Issue A. In its relations with Egypt, Algeria and Tunisia, theU.S. should give its highest priority to:

Supporting governments that backArab-Israeli peace process. 30%

Promoting free elections. 7%

Supporting human rights. 8%

Encouraging economic and social reforms. 44%

Supporting repression of Islamic movements. 1%

Issue B. With regard to the Islamic revival, do you considerit a threat to U.S. interests in the Middle East?

Yes 61%

No 28%

TOPIC 8: NEW WORLD DISORDER?

Issue A. To further the national interest, the U.S. should:

Expand NATO to include nations from theformer Warsaw Pact. 68%

Maintain NATO as it is. 20%

Withdraw from NATO. 7%

Issue B. In East Asia and the Western Pacific, the U.S.should:

Maintain the present military and navalposture in the region.

Withdraw troops from South Korea and Japanwhile maintaining present naval posture inthe region.

Reduce present military and naval nurturein the region.

Negotiate overall arms reductions with theother powers of the region.

YES NO

52% 29%

24% 51%

32% -14%

79% 6%

Issue C. With regard to America's democratic mission, theU.S. should:

YES NO

Restore democracy in Haiti. 42% 32%

Deploy U.S. forces to act as peacekeepersunder United Nations command. 58% 28%

Deploy U.S. forces to act as peacekeepersunder U.S. command. 21% 54%

NOTE: Percentages reported above may not add up to 100 because77% some participants did not mark particular ballots or volunteered other11% ; responses not shown here. Percentages with .5 and above are minded

up to the next number.

94 GREAT DECISIONS 14 9 5ri 7

AFRICA'94South Africa: Forging a Democratic Union'92Africa South of the Sahara: Fresh Winds of Democracy?'89Horn of Africa: Empty Cornucopia?'87South Africa: Apartheid Under Siege'84South Africa: Can U.S. Policies Influence Change?

ASIA'93China: New Reforms, Old Politics?'93India & Pakistan: Collision or Compromise?'91Japanese-U.S. Trade: Harmony or Discord?'90Vietnam. Cambodia and the U.S.: Return Engagement?'89China: Redefining the Revolution'88South Korea: The Future of Democracy'87Pacific Basin: Alliances. Trade & Bases'87Pakistan & Afghanistan: Storm Over Southwest Asia'85The Philippines: What Future for Democracy?'84China & the U.S.: Five Years After Normalization

FORMER SOVIET UNION AND EASTERN EUROPE'94Conflict in Former Yugoslavia: Quest for Solutions'93Russia & the Central Asian Republics: After Independence,

New Directions?'92Breakup of the Soviet Union: U.S. Dilemmas'91Nationalism's Revival: The Soviet Republics and Eastern

Europe'90U.S.S.R. and Eastern Europe: End of an Era?'88The Soviet Union: Gorbachev's Reforms'85Soviet Leadership in Transition: What Impact on

Superpower Relations?'84The Soviet Union: Hard Choices for Moscow

& Washington

LATIN AMERICA'94Argentina, Brazil, Chile: Democracy and Market Economics'92Latin America's New Course: Bridge to Closer U.S. Ties?'9ICuba: What Future for Castro and Communism?'90Nicaragua and El Salvador: War or Peace in Central

America?'89Latin American Debt: Living on Borrowed Time?'88Mexico & the U.S.: Ambivalent Allies'libDemocracy in Latin America: Focus on Argentina & Brazil'85Revolutionary Cuba: Toward Accommodation or Conflict?'84Central America, Mexico & the U.S.: Discord Among

Neighbors

MIDDLE EAST'92Middle East After Desert Storm: As the Dust Settles'91The Middle East: New Frictions, New Alignments'90Palestinian Question: Is There a Solution?'89The Persian Gulf: Reassessing the U.S. Role'88U.S. & the Middle East: Dangerous Drift?'87Egypt & the U.S.: Uneasy Relations'86Israel & the U.S.: Friendship & Discord'85Iran -Iraq War: What Role for the U.S. in Persian Gulf?'84Saudi Arabia & Jordan: Kingdoms at the Crossroads?

WESTERN EUROPE'93Germany's Role: in Europe? in the Atlantic Alliance?'91The New Europe: What Role for the U.S.?'86European Community & the U.S.: Friction Among Friends'85Future of the Atlantic Alliance: Unity in Diversity?

DEFENSE AND SECURITY'94Defense: Redefining U.S. Needs and Priorities'90Third World Arms Bazaar: Disaster for Sale?'89Arms Agreements: Too Little Too Late, or Too Much

Too Soon?'88Western Europe: Between the Superpowers'87Defense & the Federal Deficit: U.S. Needs, Soviet

Challenges'86'Star Wars' & the Geneva Talks: What Future for Arms

Control?'85U.S. Intelligence: The Role of Undercover Operations'84U.S. Security & World Peace: Allies, Arms & Diplomacy

ECONOMIC ISSUES'94Trade with the Pacific Rim: Pressure or Cooperation?'93Trade & the Global Economy: Projecting U.S. Interests'90The U.S.. Europe and Japan: Global Economy in Transition?'89 Farmers. Food & the Global Supermarket'88U.S. Trade & Global Markets: Risks & Opportunities'87Foreign Investment in the U.S.: Selling of America?'86Third World Development: Old Problems, New Strategies?'85Budget Deficit, Trade & the Dollar: Economics of Foreign

Policy'84International Debt Crisis: Borrowers. Banks & the IMF

ENVIRONMENT'94Environmental Crisis in Former Soviet Bloc: Whose

Problem? Who Pays?'92Planet Earth: Dying Species, Disappearing Habitats'91Women, Population & the Environment: The Relationships,

the Challenges'90Global Warming & the Environment: Forecast Disaster?'88The Global Environment: Reassessing the Threat

U.S. FOREIGN POLICY'94New World Disorder? U.S. in Search of a Role'93U.S. in a New World: What Goals? What Priorities?'92U.S. Agenda for the '90s: Domestic Needs, Global Priorities'91Rethinking Foreign Aid: What Kind? How Much? For

Whom?'89Ethics in International Relations: Power & Morality'88U.S. Foreign Policy: Projecting U.S. Influence'87Constitution & Foreign Policy: Role of Law in

International Relations'86How Foreign Policy Is Made: The Case of Central America'85U.S. Intelligence: The Role of Undercover Operations

OTHER CRITICAL ISSUES'94Islam and Politics: Egypt, Algeria and Tunisia'93UN: What Role in the New World?'93Children at Risk: Abroad and at Home'92The Refugee Crisis: How Should the U.S. Respond?'92The AIDS Pandemic: Global Scourge, U.S. Challenge'9IMedia's Role in Shaping Foreign Policy'90United Nations: New Life for an Aging Institution'89International Drug Traffic: An Unwinnable War?'87Dealing With Revolution: Iran. Nicaragua

& the Philippines'86 International Terrorism: In Search of a Response'86Religion in World Politics: Why the Resurgence'?'85Population Growth: Critical North-South Issue?'84International Drug Traffic: Can It Be Stopped?

(; K I: A T DECISIONS 14 5 95

r

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* FOREIGN POLICY ASSOCIATION RESOURCES FOR TEACHERS *

GREAT DECISIONS 1995Briefing Book The annual 96-page, newsmagazine-sizebook offers teachers eight ten-page articles on key foreignpolicy and global issues facing the U.S. It is the basic re-source for background and overview information. GreatDecisions is highly respected for its nonpartisanship, bal-ance and accuracy ($11.00 plus $3.00 for postage and han-dling; discounts for orders of 10 or more copies).

Each article contains:

Historical background and analysis of the issues.Pros and cons of U.S. foreign policy options.

Discussion questions developed by FPA editors totrigger informed debate.

Selected readings and relevant organizationsCarefully researched list of books, periodicals andorganizations that teachers and other readers can turn tofor further study and information.

Opinion ballots Each article is accompanied by anopinion ballot which offers teachers the opportunity toencourage students to form and express their views oncomplex international issues.

Maps, charts, graphics Every issue includes an up-to-date 18" x 24" world map. Articles are illustrated andsupported by detailed charts, graphs and regional maps.

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GLOBAL CITIZEN PROJECTThis active learning program brings together teachers, stu-dents and their communities. to explore global issues and theirlocal relevance. Its primary purpose is to assist students tofunction as thoughtful. knowledgeable and active citizens ina diverse, ever-changing and increasingly interdependentworld. The program includes a two-part videotape and TheGlobal Citizen Project Sourcebook (60 pp.). The video cas-sette portrays the New York City Student Town Meeting onGlobal Citizenship, including interviews with participatingteachers, students and administrators, as well as discussionof the educational merits of the project. The sourcebook contains lessons and activities on U.S. foreign policy and globalcitizenship, including discussion outlines, debates and roleplays developed by participating teachers and FPA staff. Thesourcebook is complete with guidelines for establishing aGlobal Citizen Project in your school or community. (TheGlobal Citizen Project Sourcebook is $25; a set of two vid-eotapes is $45; the sourcebook and videotape package is$59.95; please add $3.00 for postage and handling.)

CIVIC COMPETENCE THROUGH GLOBAL STUDIESFPA is engaged in a three-year project to bring innovativeresources to you for teaching global issues. The project isdesigned to meet the growing need for quality global educa-tion materials at the secondary school level. Collaboratingwith 12 master teachers working in six major cities, FPA iscreating a teacher-guided and student-tested curricular pack-age that will include a teacher's resource book, studentmaterials, a teacher education program and a networking andinteractive learning program utilizing the latest technology.A strong "service learning" component, in which studentsengage in a venture or internship exploring connectionsbetween their communities and global systems, is infusedthroughout the program. This kind of active learning andlearning-through-service approach holds the promise of equip-ping students with problem-solving skills and some vision oftheir own role in the global village of the 21st century.

HEADLINE SERIESEach of these compact. concise books (64-80 pp.) deals witha single timely global issue or geographic area. Publishedquarterly. the Headline Series are written by experts for highschool and college students, teachers and other readers withan interest but no specialized background in internationalaffairs. Recent issues include "Global Population Growth:2Ist Century Challenges" by George D. Moffett, "ReligiousFundamentalisms and Global Conflict" by R. Scott Appleby.and "Environmental Scarcity and Global Security" byThomas F. Homer-Dixon (single issue, $5.95; one-yearsubscription. $20).

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Cover photo of UN General Assembly: United Nations

t 0


TEACHER' S GUIDE

Foreign Policy AssociationNew York

1 0 4

ACKNOWLEDGMENTS

The Great Decisions 1995 Teacher's Guide was developedby Amon A. Diggs, educational consultant. It was produced

by James I. Bauer, Jim Mavrikios and Sharon Ha.The lessons were written by Amon A. Diggs. Special thanks to

editorial assistant June Lee and editorial interns Kimberly Lantayand Tatiana L. Moklebust, who prepared the glossaries,

and to editor-in-chief Nancy Hoepli-Phalon.

Copyright 1995, Foreign Policy Association, 729 Seventh Avenue, New York, N.Y. 10019.

All rights reserved. The materials in this volume may be reproduced for classroom use or other educational purposesat the instance and inspiration of the individual teacher or discussion leader. Other than for such use, no part of thisvolume may be reproduced, stored, or transmitted by any meansmechanical, electronic, or otherwisewithoutwritten permission from the publisher.

Printed in the United States of America

ISBN 0-87124-161-7

14 G;5

CONTENTS

PageIntroduction 4

Activity Instructions

Topic 1 United Nations at Fifty: Reaching Out or Overreaching? 5

Topic 2 Nuclear Proliferation: Can It Be Capped? 9

Topic 3 Russia and Its Neighbors: U.S. Policy Choices 13

Topic 4 Middle East: Lasting Steps to Peace? 17

Topic 5 Global Finance: merica's Role and Stakes 22

Topic 6 China, Taiwan, Hong Kong: U.S. Challenges 26

Topic 7 Immigration: An End to Open Doors? 30

Topic 8 Promoting Democracy: America's Mission? 33

Handout Mastersheets

Handout #1 The U.S. and the UN 36

Handout #2 Nuclear Issues 37

Handout #3 The Middle East 38

Handout #4 Global Finance 39

Handout #5 China 40

Introduction

Many political analysts have described the 1994 elec-tions in the U.S. as a mandate for change in domesticpolicy. Others view them as a reflection of the generalunease or uncertainty about the direction in which thenation is headed. To paraphrase one pundit, the Ameri-can people are bent on seeing to it that Washingtonreally gets the message and gets it right, if not rightaway.

But what is the "message"? What is it the Americanpeople want this nation to stand for in the world? TheRepublican "Contract with America" calls for morespending to improve military preparedness. The ma-jority of voters in California favor curbing illegalimmigrants by denying their children a free education.The public at large appears resistant to sending moreU.S. troops abroad on humanitarian missions. Atti-tudes toward the UN, beginning with the White House,are changing. Each of these issues is likely to provokepassionate debate among the Administration, the Re-publican-controlled 104th Congress and the Ameri-can people in coming months.

It is risky, of course, to view international relationssolely through the lens of domestic politics. A halfcentury ago, right after the U.S. had emerged from twoworld wars and the Great Depression and was about toembark on a long, tense struggle with the SovietUnion known as the cold war, analysts speculated on

4 TEACHER'S GUIDE 1995

what the 1946 congressional elections meant for theNew Deal agenda. Within months, foreign affairs,including such landmark measures as the TrumanDoctrine, the Marshall Plan and the containmentpolicy, overshadowed domestic issues as the centralpreoccupation of the country.

There are some similarities today with the post-World War II period. Another warthe cold warhas ended, and the world is embarked on a new era.The U.S. is restive and preoccupied with its owninternal affairs. But international relations demand itsattention. In 1995, reducing trade and federal deficits,continuing attempts to curb nuclear weapons, advanc-ing the peace process in the Middle East, and redefin-ing or modifying relations with the UN are among thevital interests of the U.S. That is why we have includedthese topics in the 1995 Great Decisions briefingbook. However, we suggest that you consider thepossibility that perhaps the greatest concern of allone that may affect the future of the U.S.is thehistoric role this nation has assumed to promotedemocracy, freedom and human rights in the world.Looking at these issues through the prism of the pastmay offer new insights and approaches to currentproblems in an uncertain world. It is important that wein the U.S. define and explore our proper role in theworld and that we get it right.

A. 0 7

Amon A. DiggsDecember 1994

UN at 50: reaching outor overreaching?

Should changes be made in the UN Charter?

Should the UN intervene in disputes without the consentof the parties in question?

What ?We should the U.S. play in UN peacekeeping operations?in humanitarian operations?

ARTICLE SUMMARY

IM UNITED NATIONS will celebrate its 50th anni-versary in 1995 at a time when its status and role

are being challenged by the rise of ethnic rivalries,civil wars, human calamities and the threat of anarchyin some regions of the world. The UN has had manysuccesses: it has assisted newly independent nationsget a start and it has alleviated human misery. It hasreceived four Nobel Peace Prizes in recognition cfthese accomplishments. The organization has alsosuffered setbacks, as illustrated by its ventures inSomalia and Bosnia.

The collapse of the Soviet empire liberated the UNSecurity Council from the threat of paralysis by vetoand enabled it to embark on more peace operations inthe last decade than in the entire 40 years of the coldwar. By mid-May 1994, 70 countries had contributedto the 70,000 blue helmets in action around the world.The coming anniversary could highlight a secondchance for the UN to realize its potential as peace-maker, a catalyst for social and economic develop-ment and a humanitarian rescue service.

ACTIVITY ONE

OverviewSecretary General Boutros Boutros-Ghali, recogniz-ing that the passing of an old order does not necessarily

create a new order, has proposed UN agendas for peaceand for development. Critics believe these plans rep-resent a drift toward an undesired supranationalism,while advocates hail them as a bold new departure forthe future of the organization. The stinging defeat ofthe mission in Somalia has led critics of a proposal fora UN permanent peacekeeping force, including somein Washington, D.C., to argue that the UN is overex-tended and should not be given more power. TheWhite House issued new policy guidelines that setstrict conditions not only for U.S. participation in UNpeace operations but also for U.S. support for any newpeace missions. This action strained relations betweenBoutros-Ghali and President Bill Clinton and led thesecretary-general to temper his views.

Boutros-Ghali did not modify his views on what hestated was an agenda for "human development." Ad-vocating more attention and more aid for "low-incomecountries," the secretary-general called for improvedprogress toward social justice, population control andenvironmental responsibility. He asked for rapid im-provements to raise the quality of life for millions ofpeople around the globe while preserving the earth'senvironment.

As with the questions raised concerning peace opera-tions, criticism and resistance to the secretary- general'sagenda focused on national sovereignty, UN capabili-ties and the intractability of many problems around the

TEACHER'S GUIDE 1995 5

108

TEACHER S GUIDE

world. Despite several important conferences that havealready been held and others planned for the future,many maintain that local and national governments,responding to pressures from community groups andNGOs, hold the key to improving people's lives andmaintaining peace.

What are the prospects for the UN? How should theUN respond to the escalating threats to peace that haveoccurred since the end of the cold war? What policiesshould the U.S. adopt and what role should it play asthe major power in the world organization? Can theUN persuade its critics to accept a new role for theorganization?

ObjectivesUpon completion, participants will be able to:

1. Describe the role the UN played in world affairsduring the cold war.

2. Analyze and discuss significant world trendsthat have emerged since the end of the cold war.

3. Describe the agendas for UN peacekeeping anddevelopment proposed by Secretary GeneralBoutros-Ghali.

4. Evaluate their effects on the UN and on theworld community.

MaterialsChalkboard, chalk

TimeApproximately 55 minutes

ProceduresBegin the discussion by asking the participants to listwhat they believe were the most significant UN achieve-ments in peacekeeping and development assistance inthe 40 years of the cold war. Have them explain howthe nature of the cold war affected these efforts.

Then ask them to list the most significant UNachievements in peacekeeping and development as-sistance in the years since the end of the cold war. Askthem what social, economic and political conditionsmay have hindered these actions and have themcomparethe obstacles with those that existed during the cold war.

Divide the participants into two groups, "peace-keeping agenda" and "human development agenda."Give them each about 15 minutes to do the following:

a) describe Secretary General Boutros-Ghali'sideas on how to achieve this agenda;

b) explain what major obstacles must be over-come in order to accomplish this agenda;

c) determine what, if anything, must be done topromote this agenda;

d) describe how this would affect the position androle of the UN.

When the time is up, bring the two groups togetherand, outlining their responses on the chalkboard, havethem explain their agenda, describe the obstacles thatexist to its implementation and determine what actionswould be required in order to carry it out. Ask them topresent a scenario in which their agenda could besuccessfully adopted by the UN. Ask them to comparethe effects of the two agendas on the world and on theUN. Get them to determine which of the two would bemore practical or easier to implement at the present timeor in the foreseeable future. Ask them whether or not theUN must adopt one or both of these agendas in order tobe relevant and an important agent in today's world. Getthem to explain what they believe will or will nothappen if these proposals fail to be adopted by the UNand what that will mean for the prospects for peace andhuman development.

ACTIVITY TWO

OverviewThe U.S. has tended to withdraw into some form ofisolationism after an important or significant interna-tional event. With the end of the 40-year cold-warstruggle between the U.S. and the Soviet Union, thistendency has once again manifested itself. World con-ditions are changing rapidly, and in many regionsnational order has broken down into bitter ethnic,religiot , and civil chaos. It is ironic that the U.S., theworld's only superpower, must grapple with this incli-nation. Americans are hesitant and confused over theirrole and options for dealing with today's global uncer-tainties. Should they embrace supranationalism andsubordinate U.S. political will and military power tointernational control? Or should they act in concert with

6 TEACHER'S GUIDE 1995 X09

TEACHER S GUIDE

other nations only when it will advance the vital inter-ests of the U.S.? In the Persian Gulf, Somalia, Haiti andother areas, U.S. policies have reflected uncertaintyabout U.S. goals and missions.

What role should the U.S. play in the world com-munity? How should the it respond to the peacekeep-ing and development agendas under discussion at theUN? What--if anyobligation does the U.S. have tosupport the UN as it attempts to adjust to the post-cold-war world? What effect will U.S. policies have on theUN and the prospects for peace and human develop-ment?


1. Describe changes in the post-cold-war worldand how they affect the vital interests of theU.S. and the UN.

2. Explain how the proposals of SecretaryGeneral Boutros-Ghali conflict with the consti-tutional and historical role of the U.S.

3. Analyze and evaluate how the U.S. can main-tain its presence in global affairs, reconcilingthat role with U.S. traditions and economic andpolitical requirements.

Materials"Handout on the U.S. and the UN" (see page 36),chalkboard, chalk


ProceduresDistribute the "Handout on the U.S. and the UN."Have participants examine actions by the U.S. de-picted in the first four sections of the handout. Havethem take about 20 minutes to discuss key items ineach period and determine:

a) why they believe the U.S. position in eachperiod was in the best interests of the U.S. andthe world;

b) what, if anything, they believe the U.S. shouldhave done differently in each period;

c) how they believe this difference in policy oraction would have affected the global positionof the U.S. and some of the major problems thatnow exist in the world.

Ask the participants to identify major trends orpatterns in the ways in which the U.S. has dealt withimportant international events since 1910.

Next have the participants examine the recent U.S.actions or involvements listed in the fifth section ofthe handout. Have them compare these actions withones in the past, and ask them to determine whichactions they believe are in the best interests of theU.S.

Have them explain how conditions and problemshave changed in the world since 1990 and how thestatus and role of the U.S. and the UN have changedin response. Ask them what they believe the relation-ship between the U.S. and the UN should or shouldnot be as the U.S. seeks to define and explain its rolefor the foreseeable future.


t10

EACHER S GUIDE

GLOSSARY

blue helmets. UN peacekeeping forces. Peacekeepingmissions fall into one of two categories: to stop or contain

hostilities, thus creating conditions in which peacemaking

can prosper, or to supervise the implementation of an

interim or final settlement that has been negotiated bypeacemakers.

Khmer Rouge. Native Cambodian Communists who took

power in Cambodia in 1975 under the leadership of PolPot. The Khmer Rouge was responsible for the deaths of

between 1 million and 3 million Cambodians. The regime

was overthrown in 1979 when Vietnam invaded Cambodia.

Since then the Khmer Rouge has maintained a guerrilla

force to fight the Vietnamese. Literally, "rouge" means red(the symbolic color of communism) and "Khmer" is thename of the people who live in Cambodia.

Kurdish minority. An ancient non-Arab people totaling20 million or more, the Kurds are dispersed among Iran,

Iraq, Turkey, Syria and Kurdistan. The majority belong to

the Sunni sect of Islam, the dominant sect representing

90% of the world's Muslims. Most are tribesmen who livein mountainous areas that, until modern times, were farfrom the reach of a central government. A small number

are urbanized. The Kurds failed to win recognition as a

separate state after World War II, and since then they have

attempted to achieve greater autonomy within various

countries.

League of Nations. An association of nations devoted to

peace, established in 1919 in the aftermath of World War

I. The Senate refused to approve U.S. participation. Theleague was dissolved in 1946 and many of its functions

were taken over by the UN.

macroeconomic growth. Macroeconomics is that branchof economics that analyzes patterns of change in national

economic indicators such as gross domestic product, themoney supply and the balance of payments. Governments

attempt to influence these indicators through fiscal policies

that determine the level and pattern of national expendi-

tures and raise revenues through taxation and deficit

financing and monetary policies.

multinationalism. Of, relating to, or involving mon- thantwo nations.

Operation Desert Storm. Military action in the Persian Gulf

war that commenced on January 16, 1991, when the U.S.-led

coalition of UN forces began bombing Iraq in response to

Iraqi President Saddam Hussein's occupation of Kuwait.Desert Storm involved a month of heavy bombing of Iraq'sinfrastructure, culminating in a ground offensive that liber-

ated Kuwait.

Organization of American States (OAS). A 24-memberregional association of Western Hemisphere states. The OAS

charter was adopted at Bogota, Colombia, in 1948. Theorganization's purpose is to promote solidarity and strengthen

collaboration among the member states and defend their sov-

ereignty, territorial integrity and independence.

Security Council. An organ of the UN that has primaryresponsibility, under the Charter, for the maintenance ofinternational peace and security. The Secuarity Council com-

prises 15 members: 5 permanent members, the U.S., Britain,

China, France and Russia, and 10 elected members. TheSecurity Council is responsible for investigating disputes,recommending methods for settling conflicts, establishing a

system to regulate armaments, determining the existence of a

threat or act of aggression and recommending action, andcalling on members to apply economic sanctions to prevent

aggression.

United Nations Children's Fund (Unicef). An internationalagency that distributes funds among countries to improvechildren's welfare. Initially established as a temporary orga-

nization to assist children in war-torn countries, Unicef was

made permanent in 1953.

1111 United Nations Development Program (UNDP). An inter-

national agency that coordinates and administers technicalassistance provided through the UN system to speed socialand economic development in less-developed countries.

United Nations Office of High Commissioner for Refugees

(Unhcr). The office was established by the UN GeneralAssembly in 1950 to protect refugees and promote durable

solutions for their problems. Unhcr depends entirely onvoluntary contributions from governments and private sources

for its programs, and seeks to assist the more than 12 million

refugees in the world.

United Nations Population Fund (Unfpa). Originally calledthe United Nations Fund for Population Activities, the agency

was founded in 1972 to help support population and family-

planning services in developing countries. The largest source

of multilateral population assistance, Unfpa has a budget of

more than $150 million and funds programs in about 14()countries.

TEACHER'S GUIDE 1995

Nuclear proliferation:can it be capped?

How important is nonproliferation in the post-cold-war period?

Are current safeguards adequate to deal with the problem ofnuclear proliferation?

What measures can be taken to stem the sale of nuclearmaterials on the black market?

ARTICLE SUMMARYURGING THE SPREAD of nuclear weapons, stem-ming the nuclear ambitions of nonnuclear coun-tries and lowering existing nuclear stockpiles are

high on the list of U.S. foreign policy priorities. Theseare among the issues to be discussed in April and May1995, when representatives of more than 160 nationsmeet in New York City to decide whether to extendindefinitely the Treaty on the Nonproliferation ofNuclear Weapons (NPT), the world's chief defenseagainst the spread of nuclear arms. Although thedisintegration of the Soviet Union and the end of thecold war have greatly reduced the threat of nuclearwar, nations continue to possess, build or aspire tobuild nuclear weapons. Since the first atomic bombwas tested in 1945 in the New Mexico desert, nuclearweapons have shaped the lives and destinies of peopleand nations around the world. The article traces thehistory of three nuclear races: against the Nazis,between the superpowers and against further prolif-eration. It examines what motivates countries to ac-quire nuclear weapons and discusses the scope andeffectiveness of international nuclear nonproliferationefforts, including the role of the International AtomicEnergy Agency (IAEA). It surveys nuclear hot spots,including the former Soviet Union, North Korea, Iraq,India and Pakistan. Finally, the article outlines currentU.S. policy on nuclear proliferation and presents differ-ent policy options for the future.

ACTIVITY ONE

OverviewThe debate over issues and events stemming from thenuclear arms races that began during World War II stillstirs passions. The very nature of nuclear weaponsarouses strong feelings. They are perhaps the biggestthreat to the survival of human civilization as we know it.

The development of the atomic bomb during WorldWar II is one of the gripping dramas in the history ofmodern technology. This arms race began in univer-sally condemned Nazi Germany, which presented agrave threat to the world, especially the U.S. and itsAllies. The U.S. responded to the challenge by suc-cessfully developing the atomic bomb. By then theNazis sued for peace, and the U.S., faced with thedifficult task of defeating Japan, used the bomb twicein the closing days of the Pacific campaign. Thebombing of Hiroshima and Nagasaki has been thesubject of much debate, acrimony and soul-searchingever since. The atomic age had begun.

The advent of the cold war, the post-World War IIrivalry and hostility between the U.S. and the SovietUnion, spurred a second nuclear arms race. The U.S.struggled to stay ahead of the Soviets in strength,effectiveness and delivery of nuclear weapons, whilethe Soviet Union attempted to catch up to and surpassthe U.S. This resulted in the production of over 75,000


I EACHER S GUIDE

nuclear devices. Each side achieved the position ofbeing able to threaten the other with "mutually assureddestruction" in case of the outbreak of nuclear war. Atleast twice, over Berlin and Cuba, the two countrieswent to the brink of war. Other nations over timesecretly or openly joined the "nuclear club," either toflex nationalist muscles or to menace real or perceivedenemies.

As the nuclear arms race progressed, various indi-viduals, organizations and groups, governmental andnongovernmental, have attempted to stop or slow it.Efforts were also made to bring nuclear arms underinternational control, beginning with Presidents HarryS. Truman and Dwight D. Eisenhower. Eventually,however, following initiatives begun by PresidentJohn F. Kennedy, the U.S., the Soviet Union and othernations began to cooperate in the struggle to curb andeliminate these dangerous weapons and to preventtheir spread to additional nations.

Why did the world embark on a nuclear arms raceduring World War II? How did the post-World War IInuclear arms race differ from the arms race during thewar? What effect did the two arms races have on theconduct of international relations? How effective werethe attempts to limit the nuclear arms race during thecold war?


1. Explain why the nuclear arms race between theU.S. and Nazi Germany during World War!! isviewed differently than the nuclear arms racethe U.S. entered after the war.

2. Explain why the U.S. and the Soviet Unionbegan efforts to control the spread and deploy-ment of nuclear weapons and evaluate thedegree of their success.

3. Describe the effects of the nuclear arms race onthe U.S., the Soviet Union and the world duringthe cold-war era.


rimeApproximately 55 minutes

ProceduresBegin the discussion by asking the participants why somany books, films and articles have been producedabout the atomic bombing of Hiroshima and Nagasaki.Describe the debate that still rages concerning the useof this weapon and ask them to give reasons why theybelieve the bomb should or should not have been used.Ask them why the U.S. did not drop the bomb onGermany and why there has been very little criticismof the U.S. decision to develop the atomic bomb in thefirst place. Ask them for a definitive statement as towhat it means for the U.S. to be the only nation to haveused atomic weapons in warfare.

Describe the attempts by Presidents Truman andEisenhower to internationalize control of nuclear weap-ons. Ask them if, looking back, they believe this wouldhave been a wise thing for the U.S. to do, given thenature of the cold war. Ask them to assess why both theU.S. and the Soviet Union felt it necessary to mount anuclear arms race as the cold war intensified. Ask themhow they would assign blame and responsibility forthe race and get them to determine if this competitioncould have been avoided.

Point out that the U.S. and the U.S.S.R., at theirpeak, amassed over 75,000 nuclear devices. Ask themwhy this happened and what effect they believe thishad on both nations. Get them to speculate on whatboth nations could have done to avoid this develop-ment. Ask them what effect this might have had on thehistory of the past 50 years, making sure to point outthat some critics believe that the mutual threat ofoverwhelming nuclear weapons may have actuallyrestrained both the U.S. and the U.S.S.R. from goingto war. Ask them how successful the nuclear disarma-ment movement was during this period, given therivalry and suspicion on both sides.

End the discussion by asking them what theybelieve were the most successful attempts to limit oreliminate the nuclear arms race during the cold war.

ACTIVITY TWO

OverviewAttempts to curtail the world's nuclear arms buildupin the latter days of the cold war did not eliminate thenuclear threat to the world but rather set up a regimeto handle some of the major problems connected withthis issue. A key part of the regime is the nuclear


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nonproliferation treaty of 1968. In 1995 more than 160nations will meet in New York City to review its termsand to decide whether to extend it indefinitely. Someof the key issues to be explored include universalnuclear disarmament, production and control of fissilematerial, renunciation of the use of nuclear weaponsand a comprehensive ban on nuclear testing. Certainlythe roles played and the examples set by the fivedeclared nuclear powersthe U.S., Russia, Britain,France and Chinaas well as the undeclared nuclearpowers will have enormous influence on halting thespread of nuclear weapons.

The U.S. must play a leading role in these delibera-tions. It would be ironic if U.S. efforts to bring nuclearproliferation under control failed now after so muchwork. The increase of ethnic rivalries, civil disrup-tions and militarist adventurism in many parts of theworld over the last few years creates a dangerousenvironment for the continued proliferation of nuclearweapons. In several regions of the world, including theMiddle East, the Korean peninsula, Southeast Asiaand Eastern Europe, instability, threats and bitterenmity present a serious threat of nuclear war, giventhe nuclear activities of such nations as Iran, Iraq,Israel, North Korea, India, Pakistan and Russia. Inaddition, control and disposition of nuclear materialand weapons are in danger of being transferred ormoved across present national boundaries as part of agrowing trend of smuggling, surreptitious trading andprofiteering in nuclear materials.

How can the proliferation of nuclear weapons andmaterials be slowed in the post-cold-war world? Howcan the nonproliferation regime help achieve thisgoal? How will anarchistic conditions of rivalry andethnic and civil strife, coupled with bitter hatreds andpowerful national ambitions, affect this struggle? Whatrole should the U.S. play in attempting to solve thisimportant problem?


1. Describe the major reasons why nuclear prolifera-tion remains a danger in the post-cold-war era.

2. Analyze the problems and issues that contrib-ute to the dangers of nuclear proliferation andsuggest methods of dealing with them.

3. Discuss the role the U.S. should play in helpingto halt proliferation.

Materials"Handout on Nuclear Issues" (see page 37), chalk-board, chalk


ProceduresBegin the discussion by asking the group why therehas been so much chaos and brutality among variouspeoples in the world since the end of the cold war. Askthem why a world dominated by the U.S. and theSoviet Union seemed to be more orderly and to lackthe disturbing outbreak of ethnic tensions, rivalriesand violence that has occurred recently. Ask them tolist the regions showing the most bitter or violentdisturbances. List the regions they name on the chalk-board.

Break the participants into groups representing sixareas possessing nuclear weapons: Europe and China,the former Soviet Union, North Korea, the MiddleEast, South Asia and the U.S.

Distribute the "Handout on Nuclear Issues" to eachgroup and ask the participants to work together tocomplete the handout and to determine strategies thatthey believe could resolve the major problems in theseareas. Give them about 15 minutes for this task.

After they have finished, bring them back togetherand ask them to describe the nations they represent andwhat they believe their nations are seeking in the worldcommunity. Ask them to state what they believe arethe major national issues or problems and ask themwhat could be done to address these problems peace-fully. Ask them whether the nations or problems theyhave discussed have a direct bearing on some of thetroubled areas they have identified previously andlisted on the chalkboard. Then ask them what effectnuclear weapons will have on these issues. Ask themif they believe nuclear proliferation can be separatedfrom the basic problems they have discussed and, if so,how they believe this can be accomplished.

After each group has finished, ask if it is possible todevise a general strategy to reduce or eliminate thedangers of nuclear weapons throughout the world bycomparing the situations and the remedies suggested foreach area. Ask them whether they believe the

114TEACHER'S GUIDE 1995 11

I EACHER S GUIDE

nonproliferation regime, the UN or some other groupsor organizations might best be able to develop such astrategy. Ask them what role the U.S. can and shouldplay in order to assist in this process.

Conclude by asking participants why they do or donot believe that the issue of nuclear proliferation willbe resolved in the immediate future and what theybelieve will be the consequences.

GLOSSARYatomic bomb (A-bomb). Bomb whose explosive powercomes from the fissionable nuclei of the isotopes uranium-235 or plutonium-239. The first had a force of 17 kilotons of

TNT.

fission. Splitting of uranium or plutonium atomic nuclei into

fragments releases energy in the form of heat, blast andradiation. This process is used in atomic bombs.

fusion. The compression of lightweight atomic nuclei into a

nucleus of heavier mass, with the attendant release of energy,

a process similar to that which occurs in the sun. This process

is used in hydrogen bombs.

highly enriched uranium. Uranium in which the percentageof uranium-235 nuclei has been increased from the naturally

occurring level of 0.7% to some greater level, usually around

90%. Along with plutonium, one of the two fuels essential for

making nuclear weapons.

hydrogen bomb (Ii-bomb, or thermonuclear bomb). Bomb

whose explosive power derives from nuclear fusion. The first

one tested by the U.S. was nearly 600 times more powerfulthan the atomic bomb dropped on Hiroshima. Hydrogenbombs have never been used as weapons.

Intermediate Nuclear Force Treaty (LNF). 1987 bilateraltreaty between the U.S. and the U.S.S.R. eliminating interme-

diate- old short-range ballistic missiles.

International Atomic Energy Agency (IAEA). Establishedin 1957, it has a working relationship with the UN. Under the

NPT (see below), parties must conclude a safeguards agree-

ment with the IAEA, whose main job is to verify that nuclear

materials used to produce energy in member countries are not

diverted to military purposes.

nuclear nonproliferation regime. See Treaty on the Non-Proliferation of Nuclear Weapons.

plutonium. An isotope which is manufactured artificiallywhen uranium-238, through irradiation, captures an extraneutron. One of the two core materials used in nuclearweapons, the other being highly enriched uranium (see above).

safeguards. System used by the IAEA to inspect a nation'snuclear facilities that are declared as a result of the countrybecoming party to the NPT or as a result of a bilateralagreement. Inspections make use of a mix of material accoun-

tancy, containment and surveillance to provide evidence of

unauthorized use or transfer of safeguarded nuclear materials.

spent fuel. Nuclear fuel that has been used in a reactor andremoved because it contains too little fissile material tosustain reactor operation. It is extremely radioactive.

Strategic Arms Limitation Talks (SALT) I and H. Salt Italks (1969-72) resulted in the Antiballistic Missile (ABM)Treaty of 1972. The treaty, amended in 1974, limits ABMsystems to a single deployment area of 100 ABM launchers

and missiles. In the Interim Agreement of 1972, the U.S. and

the U.S.S.R. froze the number of strategic-ballistic-missile

launchers at 1972 levels. The second round of talks (1972-79)

ended in agreement by the U.S. and the U.S.S.R. to set equal

aggregate ceilings and subceilings on strategic-offensive-weapons systems and impose restraints on existing and future

strategic systems. Before the agreement was ratified, the U.S.

repudiated its commitment to remain within SALT II limits in

response to alleged Soviet violations.

Strategic Arms Reduction Treaty (Start) I and IL Signedby the U.S. and the U.S.S.R. in July 1991, Start I provides for

the reduction of approximately one third of strategic war-heads of both parties, limiting nuclear warheads to 6,000.Under Start II, the U.S. and Russia will reduce strategicwarheads to between 3,000 and 3,500 and eliminate land-based missiles with multiple warheads.

Treaty on the Non-Proliferation of Nuclear Weapons(NPT). The cornerstone of the nuclear nonproliferation re-

gime, this multilateral treaty entered into force on March 5,

1970. It currently has 164 parties, including the five declared

nuclear-weapons states.

weapons of mass destruction (WMD). Nuclear, biologicaland chemical weapons.


!I 13

Russia and its neighbors:U.S. policy choices

What role will Russia play in the former Soviet empire?in Western Eumpe?

How important is the military in the new Russia?

Should the U.S. attempt to influence events in Russia?in its 'near abroad'?

ARTICLE SUMMARY

rni THE COLLAPSE of the Soviet Union, the U.S. isYV now faced with rethinking its foreign policy

agenda. Allen Lynch, an authority on the U.S.S.R. andpost-Soviet affairs, addresses the political, economicand military situation Russia now faces, Russia'spolicies toward the rest of the former Soviet empire aswell as U.S.-Russian relations. The author points outthat Russians have not yet come to grips with theirnational identity now that the U.S.S.R. has founderedand some 25 million ethnic Russians live outside ofRussia proper. This colors their relations with their"near abroad," the former Soviet republics. ShouldMoscow treat those relations as domestic or foreign?The identity issue also affects U.S. policy toward theformer U.S.S.R. The author cites a number of pointsthe U.S. should consider in shaping future relationswith Russia. Should the primary U.S. goal be ideo-logical, promoting democracy? Should the U.S. try tointegrate Russia and its near abroad into the Westernpolitical and economic system? Should the issue ofdenuclearization dominate the U.S. agenda? Or shouldthe U.S. place limits on its involvement with thecountries of the former Soviet Union now that they nolonger pose a serious security threat?

ACTIVITY

OverviewAs predicted by the statesman and Soviet expertGeorge F. Kerman in 1947, the dissolution of theSoviet Union has turned one of the strongest powersinto one of the weakest. The voluntary breakup of theU.S.S.R., unaccompanied by war, has destroyed theimperial legacy of Russia and the Soviet Union whileraising questions about the nature and identity of thenew Russian state. The course of action Russia willfollow to promote domestic reform and to pursuerelations with the other former Soviet republics, hometo 25 million ethnic Russians, will have repercussionsboth inside and outside the country. The stakes arehigh and, for the U.S. and Western Europe, they raiseunsettling questions about the focus and thrust ofRussian policy and relations.

What direction will Russia follow as it moves awayfrom its Soviet past? Democracy, free markets andrespect for law are elusive, difficult goals to attain, andthe country has complex historic, structural, politicaland economic impediments to overcome. Without theautocratic Soviet apparatus providing structure anddefining objectives, Russian political leadership is


16

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struggling to survive and promote its interests. Underthese conditions, can the government control theeconomic and social dislocation that permeates Rus-sian society? Is Russia an ethnic state? Should anautocratic government impose control from the top tomaintain social order? Who speaks for society and itsgoals?

Political reforms, privatization and economic re-structuring are moving forward, and, according tosome critics, a "Russian miracle" is possible in theforeseeable future. However, many questions regard-ing political, economic or social issues must be ad-dressed. The Russian military establishment exempli-fies the lack of cohesion that exists within the country.Once a first-class military threat, it now possesseslittle global military power but sometimes acts inde-pendently as a spokesperson in foreign matters anddomestic affairs. Organized crime has taken root,seizing control of over 40,000 privatized enterprises.Violence and other social disorders are on the rise.

Perhaps the key to the future of Russia and itsinfluence or control in Eurasia lies in the nature ofRussian foreign relations. Though no longer a world-class power, Russia's relations with its former fellowrepublics, with Western Europe and with the rest of theworld could overshadow its domestic concerns andinfluence its political and economic development. Byskillfully addressing Russia's attitudes about the nearabroad and its special interests there, the U.S. mayplay a pivotal role in assisting the Russians in theirattempts to institute political and economic reform.The U.S. can let Russia know that it cannot actimperially without serious consequences.

What fundamental changes have occurred in Russiasince the dissolution of the Soviet empire? Whatissues or concerns threaten the progress of the newRussian state toward economic, social and politicalreform? How will Russians' views of their own iden-tity and their views of their neighbors affect Russiandomestic area affairs? Should the U.S. attemptto influence

4/-events in the new Russian state and, if so,

how much?


1. Describe how the dissolution of the SovietUnion affected social, political and economicconditions in Russia.

2. Describe Russia's attitudes toward the formerSoviet empire and how they may affect futuredevelopments.

3. Discuss how the U.S. may influence develop-ments in Russia on a long-term basis.



ProceduresBegin the discussion by pointing out the basic prin-ciples of the Monroe Doctrine. Explain why the U.S.,a new, weak nation facing potential interference frompowerful European countries such as England andFrance, issued such a doctrine. Ask the participantshow the doctrine helped to promote the developmentof the U.S. and its "backyard."

Turn the discussion to Russia in the 1990s. Give theparticipants 10 minutes to do the following mapexercise. Have them study the small map and observewhat happened to the Soviet Union in 1989-90. Whatnew nations were formed when the Soviet empirebroke up? Then have them study the large map. Whatother changes have occurred in Eastern Europe sincethe empire disintegrated (for example, the breakup ofC:echoslovakia and Yugoslavia)? Ask the partici-pant why Russians today view the Monroe Doctrineas an object lesson in how a "great power" shouldbehave in its own backyard. Ask them how circum-stances surrounding Russia in the 1990s differ fromthose surrounding the U.S. in 1823. Ask them whetheror not these differences strengthen or weaken the casefor Russia as it attempts to emulate the doctrine.

Div;.de the participants into three groups and askeach group to describe conditions and changes that areoccurring within Russian society under the followingcategories: "political," "economic," and "social." Af-ter about 10 minutes bring the groups together andlead a discussion concerning the changes they havedescribed and how they will or will not affect thefuture development of the Russian state. Get them to


Ali

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state whether or not they believe these problems willaffect Russian relations and attitudes with the nearabroad and whether or not they believe it will bepossible for the Russians to exert influence over theformer Soviet empire and in the rest of the world. Askthem what price Russia must pay to do so. Ask themif they consider this to be primarily a foreign ordomestic issue within Russian society.

Finally, ask the participants to describe a scenariothey believe would be in the best interests of the U.S.concerning political, social and economic develop-ments in Russia. Ask them if the U.S. can use Russianconcern and debate over the near abroad to enhancediplomatic influence over the new Russia and toinstitute a successful, long-term relationship betweenthe U.S. and Russia.

GLOSSARY

Baltic states. Estonia, Latvia and Lithuania. The Baltic states

were annexed by the Soviet Union in 1940. Intense national-

ism and independence movements surfaced during the Soviet

reform period of the late 1980s. All three regained theirindependence from the Soviet Union in 1991.

Bolshevik party. Formed in 1903 when the Socialist Con-gress divided into the Bolshevik (majority) party andMenshevik (minority) party. Led by Lenin, the Bolsheviks, a

radical Marxist party, overthrew the Provisional Government

in the November (Bolshevik) Revolution of 1917 (seeTimeline

1917-94), establishing the Council of People's Commissars.In March 1918 the party was renamed the Russian Communist

party; in 1952 it became the Communist party of the Soviet

Union (CPSU).

Commonwealth of Independent States (CIS). On Decem-ber 8, 1991, the leaders of Russia, Ukraine and Belarusdeclared the U.S.S.R. ceased to exist and formed the CIS, aloose federation, to replace the union. The CIS currently has

12 members: Armenia, Azerbaijan, Belarus, Georgia,Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan,Turkmenistan, Ukraine and Uzbekistan.

corporatist state. A political system in which the principalfunctions, such as banking, industry, labor and government,

are organized as corporate entities, each of which exercisestotal control over its particular sector.

de Gaulle, Charles. French general and statesman, the firstpresident of the Fifth Republic (1959-69), De Gaulle became

a symbol for the French Resistance to the Nazis during World

War II. De Gaulle sought to reestablish France as a worldpower, revitalizing the economy and developing a nuclear-weapons program (see Topic 2).

Gorbachev, Mikhail S. Leader of the Soviet Union from 1985

to 1991, Gorbachev instituted unprecedented economic and

political reforms, including perestroika (restructuring) and

glasnost (openness). Winner of the 1990 Nobel Puce Prize,

the embattled Soviet president resigned on December 25,1991.

gross national product (GNP). The measure of a nation'stotal output of goods and services in a given year.

Hitler, Adolf. Chancellor (prime minister) and self-pro-claimed Fiihrer (leader) of Germany from 1933 to 1945, Hitler

was one of the most heinous dictators of the 20th century. A

fanatical believer in the superiority of the so-called Aryan race

(which he termed the master race), Hitler sought to take over

Europe and to exterminate Europe's Jews and other minori-ties. Facing defeat in World War II and increasingly isolated,

Hitler committed suicide on April 30, 1945.

Monroe Doctrine. Announced in 1823 by U.S. PresidentJames Monroe, the doctrine served to put Europe on notice

that the Americas were no longer open to colonization andintervention by European powers.


TEACHERS GUIDE

GLOSSARY (cont.)

Nazi Germany. Nazism was an ideology and a politicalmovement that arose in Germany in the 1920s under AdolfHitler and prevailed in the country from 1933 to 1945.Violently anti-Semitic, Nazism stirred intense German na-

tionalism, elevated the so-called Aryan race above all others

and advocated the unification of all German-speaking peoples.

The disintegration of Nazism came with Germany's defeat in

World War II in 1945.

North Atlantic Treaty Organization (NATO). Militaryalliance established in 1949 aimed mainly at protectingWestern nations from the Soviet bloc. (The Warsaw Pact was

established in 1955 as the Soviet-bloc counterpart to NATO.

The pact formally disbanded in 1991.) Formed in response to

the perceived hostility of the Soviet Union, NATO currently

has 16 member nations and is searching for a proper role in the

post-cold-war world.

Ottoman Empire. A major Muslim power, the OttomanEmpire began its expansion in the 13th-14th centuries, con-

trolling southeastern Europe, the Middle East and NorthAfrica. Under the reign of Suleyman the Magnificent (1520-

66), the Ottoman Empire reached the peak of its power and

wealth. The empire then slowly disintegrated; at the end of

World War I its possessions became separate states and itscenter was reorganized as the republic of Turkey.

Roosevelt Corollary. In 1904, U.S. President TheodoreRoosevelt added a corollary to the Monroe Doctrine thatjustified U.S. intervention in Latin America in order toprevent European intervention.

Union of Soviet Socialist Republics (U.S.S.R.). Created in1922, the union consisted of 15 republics: Armenia, Azerbaijan,

Byelorussia, Estonia, Georgia, Kazakhstan, Kyrgyzstan,Latvia, Lithuania, Moldova, Russia, Tajikistan, Turkmenistan,

Ukraine and Uzbekistan, and held strong control of sixCommunist countries in Eastern Europe. Seven leaders ruled

the U.S.S.R., beginning with Vladimir I. Lenin in 1918 and

ending with Mikhail S. Gorbachev in 1991. Formerly asuperpower adversary in a cold war with the U.S., the U.S.S.R.

broke up in 1991. Twelve of the former republics are nowmembers of a loose federation, the Commonwealth of Inde-

pendent States. (The Baltic states regained their indepen-dence in 1991.)

Weimar Germany. The democratic government which was

formed shortly after Germany's defeat in World War I in 1918

and lasted until the appointment of Adolf Hitler as chancellor

in 1933. Severely handicapped by political and economicproblems after the war and by the Great Depression, Weimar

Germany succumbed to Hitler and Nazism.


.; IS

Middle East:lasting steps to peace?

How will Israel and its Arab neighbors resolve theirremaining differences?

What can be done to halt extremist activities thatthreaten peace in the area?

Should the U.S. provide troops to monitor peace in theGolan Heights?

ARTICLE SUMMARY

THE ARAB-ISRAELI struggle that led to a century ofconflict in the Middle East has been transformed

in the past few years. The Israeli government and itslongtime antagonist, the Palestine Liberation Organi-zation (PLO), have now acknowledged each other'slegitimacy and have made a commitment to negotiaterather than fight over future relations. In 1993 aprocess expected to take five years began to restoreself-government to Palestinians in the territories Israelhad occupied in the 1967 war. Whether this will leadto Palestinian statehood is not clear. The article pro-files the occupied territoriesthe Gaza Strip, theGolan Heights and the West Bank. It also assessesIsrael's relations with neighboring Arab states, in-cluding Jordan, Syria and Lebanon, that are critical toIsrael's security. The U.S. role in the peace process isalso discussed. The way to the Israeli-Palestinianagreement of 1993 was paved by the Camp Davidaccords of 1978 and the Madrid Conference of 1991.The present focus of U.S. diplomacy, and a key tofurther progress, is an agreement between Syria andIsrael over the Golan Heights. The article examinespolicy options facing the U.S., including how closelyit should work with Syria, whether it should be willingto provide forces to monitor peace on the GolanHeights, and whether and under what conditions itshould support Palestinian statehood.

ACTIVITY ONE

OverviewThe struggle between Jews and Palestinians in theMiddle East has been driven by hatred and filled withbloodshed. It has been a battle between enemies whohave suffered greatly in recent years; each has pro-claimed the righteousness of its cause while minimiz-ing or ignoring the agony or grievances of the otherside. Both cite historic, cultural and religious prece.dents to bolster their claims to the disputed land theycall home, which until recently they have been unwill-ing to share or divide.

Controversy in this century over a Jewish homelanddeveloped under the conflicting policies of Britain on itsmandate in Palestine. During World War I Britain hadendorsed the Zionist desire for a homeland in Palestinebut had also promised to create an Arab state from landscontrolled by the Ottoman Empire. Between 1918 and1939, thousands of Jews migrated to their homeland.Arabs in the region revolted, protesting that Britain hadreneged on its promise to support their right to self-determination. To quell Arab hostility during WorldWar II, Britain announced that it would end its mandatein 10 years and restricted Jewish immigration. AfterWorld War II, Britain turned the problem over to theUnited Nations, which passed a resolution partitioningPalestine into independent Arab and Jewish states. Jews

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accepted the resolution, Arabs did not. The state ofIsrael was created, but Palestinians and their Arab alliesvowed to destroy the new country and retake the land.After defeating Egypt, Jordan and Syria in the six-daywar in 1967, Israel expanded its territory beyond itsoriginal boundaries into the Sinai Peninsula, the GazaStrip, the Golan Heights and Fast Jerusalem. Palestin-ians, led by the PLO, vowed to continue the struggle todestroy Israel and to create a Palestinian homeland. TheU.S.-Soviet rivalry and the West's interest in preservingaccess to the region's petroleum made the Middle Easta major cold-war arena.

The first significant move toward a peaceful accom-modation between Israel and its neighbors began withthe Camp David accords (1978) between Israel andEgypt. Along with Egyptian recognition of the state ofIsrael in exchange for the return of the Sinai, the partiesagreed on a process to resolve the Palestinian question.While this commitment was never honored, CampDavid nevertheless represented a breakthrough. Israelhad traded land for peace and had indicated a willing-ness to address Palestinian grievances.

The next important step in the peace process beganafter the Persian Gulf war in 1991. Since World War II,the U.S. has played an important role in the Middle East.It recognized the state of Israel in 1948, hosted andsupported the peace process at Camp David and hasbeen granting $5 billion in aid to Israel and Egyptannually since the agreement. The U.S. pushed for newinitiatives at the Middle East peace conference inMadrid in 1991. These led to the historic agreementsbetween Israel and the PLO in 1993 and Israel andJordan in 1994. Thus Palestinians, Jordanians andEgyptians have come to peaceful terms with Israel, andPalestinians in the Gaza Strip and Jericho on the WestBank have begun to administer most of their owndomestic affairs. An accord may be reached betweenIsrael and Syria over the Golan Heights. However,analysts argue that the time for accommodation isrunning out because in the next year or so the presentleaders may be replaced by ones less willing to compro-mise.

Many complex difficulties still remain between Is-rael and the Palestinians. Important issues such assecurity affairs, economic development, Palestinianstatehood, Jewish settlements, refugee problems, thestatus of East Jerusalem, water rights, political extrem-

ism and hatred, among others, must be addressed. Afteryears of conflict and hatred, resolving these differenceswill not be easy.

Will the peace process continue in the Middle Fast?How will Israelis and Palestinians resolve their remain-ing differences? Is an Israeli-Syrian accord likely?


1. Describe the major issues dividing the Israelisand Palestinians as they explore the peaceprocess.

2. Compare the different perspectives and aims ofthe two sides concerning the resolution of theseissues.

3. Discuss methods that will help the two sidesresolve their differences and achieve peace.

Materials"Handout on the Middle East" (see page 38), chalk-board, chalk


ProceduresBegin the discussion by asking the participants whatthey would regard as extreme behavior on the part ofindividuals in defense of their ideals or beliefs. Askthem if they would personally subscribe to such be-havior. Ask them if they would be willing to sacrificetheir own lives or the lives of their families and friendsin order to protect or promote something they believeto be extremely important to their existence. Get themto explain when, if ever, they would compromise ormodify their beliefs.

Ask them what they believe to be extreme behavioron the part of states in defense of their ideals or beliefs.Ask them if there is a difference between extrememeasures employed by a state as opposed to an indi-vidual. Get them to explain when, if ever, a state shouldbe willing to sacrifice the lives of its citizens for some-thing it believes is extremely important to its existence.Ask them when, if ever, a state should compromise ormodify its beliefs in order to avoid extremism.

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Briefly describe the dispute between the Israelisand Palestinians. Describe the peace process andexplain some of the major agreements that have beenmade. Point out some of the violent events that haveoccurred in recent times and ask them how theseincidents will affect the peace process.

Divide the participants into two groups, one repre-senting the Palestinians, the other the Israelis. Distrib-ute the "Handout on the Middle East." Ask them towork within their groups to develop solutions to theproblems listed on the handout that will best serve theinterests of the group they represent. Give them ap-proximately 20 minutes to complete this task.

Call them back together and ask them to describethe solutions they devised for the problems listed.Summarize the views of each group on the chalkboardunder the headings "Israeli proposals" and "Palestinianproposals." Ask them to compare the various propos-als. Ask them which proposals on any given issue aresimilar. Then ask them which proposals are far aparton any given issue and have them explain the majordifferences. Ask what can or should be done to resolvethe differences or to narrow the gap between them.Ask them how differences could be resolved throughcompromise. Ask them if they believe this will occurduring the peace process.

End the discussion by asking them to predict theorder in which these problems will most likely beresolved during the peace process and to estimate howmuch time this will take. Turn once again to thequestion of extremism and ask them what extremistinfluences or events are most likely to occur that maydisrupt the peace process. Ask them if anything can bedone to curtail or prevent these extremist influences.

ACTIVITY TWO

OverviewThe relationships between Israel and its Arab neigh-bors have been fraught with distrust and hostility.Violence has often accompanied the economic andpolitical disruptions that stem from the Palestinianquestion. Religious, cultural and political differencesbetween Jews and Arabs have added to the pain andsuffering felt throughout the region. The dispute be-tween the Palestinians and Israelis over land hascaused numerous incidents of threats, terrorism, warand migration in the region.

Arab nations uniformly have regarded Israel as aninterloper that had seized Arab land. T1.;.- displacementof hundreds of thousands of Palestinians from theirhomes and relocation in neighboring states have causedeconomic and security problems for the host coun-tries.

Emerging Arab nationalism and pride required aresponse. As a result, a series of wars were foughtagainst Israel to show solidarity with the Palestiniancause. Israel's Arab neighbors paid the higher price forthese actions. They lost territory to a hated enemy andwere forced to accept demoralizing military defeatsand to reevaluate their support for the Palestiniancause. Palestinian support for Iraq when it invadedKuwait in 1990, in addition to antagonizing the U.S.,caused still more adjustment and reevaluation amongthese nations.

Israel also began to reevaluate its position. As ittriumphed on the battlefield, concern about state andinternal security gave way to confidence andassertiveness about the control and development of newterritory. Israel believed that the Palestinian problemcould be effectively managed and dissent subdued.Eventually, like its Arab neighbors, Israel began tochange its attitude as the strain and tensions of contin-ue(' violent confrontation and civil unrest took their tollon the state. The intilada (uprising) and the rise of more-extreme groups such as Hamas compelled many Israelisto think in more-conciliatory terms about the Palestin-ians and their neighbors. Many Israelis favored a morestrenuous effort to break the stalemate and make peace.This led to secret negotiations between Israel and thePalestinians in Norway that culminated with an accordsigned in Washington, D.C., in 1993. A major steptoward a general, comprehensive peace had been taken.

Movement in the peace process has continued. InOctober 1994 Jordan joined Egypt in reaching accom-modation with Israel. Despite protests and sometimesviolent reactions from many sides, since 1991, discus-sions concerning the Golan Heights, Lebanon, waterfrom the Jordan River, relations with moderate Arabnations such as Kuwait and Saudi Arabia, and othermatters have been moving forward.

How have changing events and attitudes enabledthe Arabs and Israelis to negotiate a general peace inthe Middle East? What steps are necessary for thisprocess to continue? What must both sides avoid in


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order to ensure that the peace process will endure?What role should the U.S. play at this time in order topromote continued success in this process?


1. Explain how constant strife, disagreement andwarfare have affected Arab and Israeli relationsin the Middle East.

2. Describe why Israel and its Arab neighbors inrecent years began to change their attitudes andapproaches toward one another in order toresolve their differences.

3. Explain what else must be done, including bythe U.S., in order to ensure that the movementtoward a general peace in the Middle East willcontinue.



ProceduresBegin the discussion by reviewing the conflict andviolence between Arabs and Israelis that existed in theMiddle East prior to the exploratory talks in Madrid in1991. Point out how the Madrid conference and simi-lar meetings were the first at which Egyptian, Israeli,Jordanian, Lebanese, Palestinian and Syrian represen-tatives sat down together and discussed their ideasabout a general peace. Ask the participants to evaluatethe success of new efforts by reviewing the agreementbetween the PLO and Israel in Washington, D.C., inSeptember 1993, and the peace treaty between Jordanand Israel in October 1994. Ask them why, after all the

violence and hatred between Israel and its Arab neigh-bors, these important breakthroughs occurred whenthey did. Ask them what had to be overcome orchanged from the past it: order for these bitter enemiesto attempt to bring about on end to years of active andundeclared warfare.

Turn the discussion to Israel's relations with Syriaand Lebanon. Give them 20 minutes to outline themajor problems or issues that exist between Israel,Syria and Lebanon. Ask them to propose solutions tothese problems that both sides might be willing toaccept. After they have completed these tasks, havethem describe the issues or problems and outline theirresponses on the chalkboard. Turn the discussion totheir ideas about resolving these problems. Be sure toask them what they believe must be done in order toaccomplish their goals and what effect, if any, previ-ous agreements made between Israel, Egypt, Jordanand the PLO will have on this process. Ask them whateffect, if any, future agreements between Syria, Leba-non and Israel would have on previous Israeli agree-ments with Jordan, the PLO or Egypt. Ask them ifthey believe that the process of making peace betweenIsrael and its neighbors becomes easier or more diffi-cult as more agreements are reached.

Turn the discussion to the role the U.S. has played.Describe the efforts made by the U.S. to start theMadrid talks and the support the U.S. offered for theaccords between the PLO, Jordan and Israel. Ask theparticipants why the U.S. should or should not con-tinue to play a similar role in negotiations betweenIsrael, Syria and Lebanon. Ask if any other state ororganization should play a leading role in the process.

End the discussion by asking for their prognosisconcerning the probability of success or failure of theIsrael-Lebanon-Syria peace negotiations. Ask themwhat outside events or ideas may influence the processthe most. Ask them how soon they believe the processwill be completed.


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'I LACHER S GUIDE ,

GLOSSARY

Camp David accords. Popular name for the treaty resulting

from the 1978 peace talks between Egypt and Israel at Camp

David, Maryland. The treaty, signed March 25, 1979, pro-

vided for Israel's return of the Sinai to Egypt and Egyptianrecognition of Israel.

Hsunas. Violent Islamic movement that gained notorietyduring the intifada (uprising) against Israel in the occupiedWest Bank and Gaza Strip. llamas opposes all compromisewith Israel and demands an end to the Jewish state.

Labor party. An Israeli political party founded in 1968. It has

a socialist orientation and promotes the separation of religion

and state. Under the Labor party's leadership, Israel negoti-ated a settlement with the Palestinians and Jordan, andsupported peace in exchange for territory.

Likud bloc. A coalition of conservative Israeli politicalparties established in 1973. The Likud is a strongly national-

ist, rightist group of parties, which advocates a Jewish state in

all of biblical Palestine, including the West Bank and the Gaza

Strip. Likud has opposed negotiations with the Palestinians.

Mecca. The birthplace of the prophet Muhammad (born A.D.

570) and perpetual shrine of Islam. Devotees everywhere turn

to face this holy city to perform the ritual prayer.

Medina. Place where the prophet Muhammad moved in A.D.

622 and an Islamic holy city.

Nazis. See Glossary, Topic 3.

Ottoman Empire. See Glossary, Topic 3.

Zionism. Derived from Zion, which was one of the biblicalnames for Jerusalem. A Zionist is a person who believes the

Jewish people consitiute a nation and have a right to return to

their ancestral homeland in Palestine.

24 TEACHER'S GUIDE 1995 21

Global finance:America's role and stakes

Can the IMF and World Bank help integrate emergingeconomies into the global market?

What actions can the U.S. take to increase thedollar's stability and attract foreign investment?

Can the IMF and World Bank function in a morecohesive manner?

ARTICLE SUMMARY

OR THE PAST 50 years, the U.S. has played theI' leading role in international financial markets.At the end of World War II, the U.S. helped create theInternational Monetary Fund (IMF) and the WorldBank to promote growth and currency stability.Through private and public funding, the U.S. grew tobe the world's largest creditor and direct investor inless-developed countries. In the past 20 years, how-ever, the relative role of the U.S. has declined, and itsability to compete in the global market has decreased.Once the world's largest creditor, the U.S. is now itslargest debtor. With foreign currencies and securitiesyielding higher returns, Americans are investing moreabroad that ever before. Consequently, the U.S.economy has become increasingly interdependent withthe global economy. The author examines the chang-ing global financial system, and prescribes a series ofsteps the U.S. should consider to strengthen its posi-tion. These include increasing its domestic savings,improving its attractiveness to domestic and foreigninvestors, and strengthening cooperation among itsmajor trading partners to reduce currency volatilityand misalignments. It must also bring up to date thecentral financial institutions of the global economythe World Bank and IMF. Because developing nationsand those in transition to the market system areplaying a greater role in the world economy, institu-

tions that do not reflect their needs and smoothlyintegrate them into the global economy will becomeirrelevant to the world's financial requirements.

ACTIVITY

OverviewSeveral important changes have been made in theworld's financial structure since the World Bank andthe IMF were set up to manage and influence globaleconomic affairs immediately after World War II.Created to help avoid the crushing economic legacy ofthe period between the two world wars, which wascharacterized by protectionism, financial turbulence,the Great Depression and high unemployment, theBretton Woods conference in 1944 established therules and institutions for a new international financesystem. Along with the General Agreement on Tariffsand Trade (GATT), which was formed in 1947, theWorld Bank and the IMF created a more open systemof international commerce and a more stable system ofinternational payments. In the first two decades, theWorld Bank lent large sums for the recovery andstability of war-devastated economies in WesternEurope.

The system of fixed-but-adjustable exchange rates,which was pegged to the U.S. dollar' s convertibilityinto gold at $35 per ounce, collapsed in the 1970s.


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TEACHER S GUIDE

Since then the U.S. dollar, while still the majorinstrument for international transactions, has no longerbeen convertible into gold. Sharp increases in oilprices in the 1970s caused oil-producing countries toaccumulate petrodollars, which they invested abroad.Shortages in savings along with massive trade deficitsled the U.S., traditionally a creditor, to borrow largeamounts of capital from abroad.

Capital flows out of the country have grown greatlyover the last few decades, as increasing numbers ofAmericans have begun to invest abroad. New players,such as commercial banks, mutual funds, insurancecompanies and pension fund trustees, no longer oper-ate solely in national markets. These new ventures intoglobal financial markets, trade, currency transactionsand cross-border transmissions of information andfunds accentuate the need to reexamine national andinternational economic policies.

In recent decades the World Bank has refocused itsefforts on assistance to less-developed economies. Inaddition to support for development of public infra-structure, financial and technical support for agricultureand education, as well as debt restructuring and helpingthe development of market economies, the Bank nowplans new approaches and reforms to enable it to assistwith domestic reforms that promote broad-based growthand reduce poverty. In addition, the Bank seeks toexpand assistance in family planning, nutrition, healthand education, as well as environmentally orientedprojects. Much of its activity will be directed towardentrepreneurial development coupled with support forinstitutional reforms within societies, which will enablenew talent to emerge.

The IMF seeks to improve dialogue among and offeradvice and consent to economic superpowers as well asdeveloping nations. In response to criticism, the IMFhas given greater attention to the social consequences ofits policies, including its efforts to improve the credit-worthiness of developing countries.

How will the globalization of markets affect worldeconomic prospects? How should the industrializednations respond to new global conditions? How canthe World Bank and the IMF contribute to changingeconomic relationships? What role will events insideand outside the U.S. play in this drama?


1. Discuss the Bretton Woods system and explainwhy it no longer is able to deal effectively withchanging global economic conditions.

2. Describe how individual entities and nationshave become more closely interconnected inworld trade and finance.

3. Describe how recent global trends in trade,investment and finance affect the World Bank,the IMF and the economic outlook of variousnations, including the U.S.

Materials"Handout on International Finance" (see page 39),chalkboard, chalk


ProceduresBegin the discussion by pointing out three disturbingeconomic trends that have recently plagued Ameri-cans, namely: the accumulation of large private andcorporate debts, a large national debt and significanttrade deficits. Ask how the lack of savings by Ameri-cans, coupled with large national debts and a signifi-cant trade deficit, affects the U.S. economy. Getparticipants to determine how and where the U.S. getsthe funds it needs to finance its debt, manage its tradedeficit and promote economic activity. Ask them howthey think this kind of economic management affectsconfidence in the U.S. and its economy abroad. Askthem what changes or reforms the U.S. should maketo manage these problems. List the reforms or changesthey discuss on the chalkboard.

Divide the participants into four groups: "Ad-vanced Nations," "Emerging Nations," "Nations Con-verting from Communism to a Free-MarketEcomony," and "Less-developed (Poor) Nations."Distribute the "Handout on Global Finance." Askthem to create an economic profile of their group andto identify several nationsomitting the U.S. thatthey believe belong to their particular group. Givethem about 15 minutes to complete this task.


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Bring them back together and ask them to summa-rize what they have determined about the economicproblems and outlook for their particular group ofnations. Outline their responses on the chalkboard,making sure that the representative nations they sug-gested are also listed. After each group has summa-rized its position, lead them in a comparison of condi-tions and problems between the groups. Ask them inwhat ways these conditions or problems are interre-lated, if any.

Briefly describe the Bretton Woods system. Refer-ring to the notes on the chalkboard, ask the participantswhich of the problems and conditions previouslydescribed were primarily responsible for the destruc-tion of the Bretton Woods system. Ask them whatactions or ideas the IMF and the World Bank should

embrace to improve economic conditions and pros-pects for each of the groups. Ask them if they believethese actions or ideas will or will not be in the bestinterests of the U.S. and why they will or will not helpthe U.S. deal with the three trends identified at thebeginning of the discussion. Ask them what role orposition the U.S. should take with the IMF and theWorld Bank.

End the discussion by asking them to explain whythey believe it is or is not possible for the U.S. to solveits debt and trade problems within the framework ofthe issues and ideas they have discussed. Ask them topredict the degree of success they believe the U.S. willachieve in carrying out national economic reform, andwhat they believe will be the consequences for the U.S.and the global economy.

GLOSSARY

bond. Written promise to pay a specified amount of money,

the principal, at a certain future date or periodically over thecourse of the loan at a fixed interest rate.

Bretton Woods system. System of international trade andfinance policy established at a conference held in BrettonWoods, New Hampshire, in 1944. Bretton Woods established

the postwar international monetary system of fixed exchange

rates. Currencies were valued in relation to the U.S. dollar,which, in turn, was fixed to the price of gold at $35 an ounce.

The system lasted until 1971 when President Nixon an-nounced the U.S. would no longer fix its currency to gold.Since then, a floating exchange rate system has prevailed in

the large developed countries (e.g., U.S., Japan, much ofEurope, and Canada).

II capital gains tax. Tax on that portion of personal incomeearned through the sale of such capital items as stocks, bonds

and real estate.

consumption-related taxes. Taxes placed on goods; forexample, sales taxes.

debt rescheduling. Changing the terms of debt repayment to

make it easier for the debtor to make interest payments with

less economic hardship.

depreciation. A decline in the exchange rate of a country'scurrency. In economies with a floating exchange rate, theexchange rate is determined by the international market de-mand for the domestic currency. If, for example, the Deutsche

mark were to become more profitable to hold than the dollar,

demand would increase, and other currencies would depreci-

ate in relation to the appreciation of the D-mark.

devaluation. Lowering the value of a nation's currency(usually done by the government) relative to the currencies of

other nations.

15 Eurodollars. Claims to U.S. dollars held by banks, busi-nesses and individuals outside of the U.S., which areredeposited and circulated in banks outside of the U.S.

E European Monetary System (EMS). Currency associationformed in 1979 by European Economic Community members

(now referred to as the European Union), in conjunction with

the establishment of the European Monetary Fund (EMF), to

establish a narrow exchange rate band to contain fluctuations

of member exchange rates. In 1991, European memberssigned the Maastricht Treaty to complete economic integra-

tion by establishing a single currency and a European central

bank. When attempting to abide by it, however, both Britain

and Italy found they could not maintain their currencies in the

band, in the face of the high interest rate of the Deutsche mark.

Consequently, in 1993 they both pulled their currencies out of

the band while Portugal and Spain sharply depreciated theirs.

exchange control. Restrictions by a government on interna-tional capital movements. The government of a less-developed

country, for example, can restrict the amount of foreign ex-

change available to its people and, in so doing, restrict their

ability to buy imports or foreign stocks.


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.1EACF-IER S GUIDE

GLOSSARY (cont)

foreign direct investment. Investment abroad usually bytransnational corporations involving an element of control by

the investor over the corporation in which the investment is

made. For example, much U.S. direct investment takes theform of investment in overseas subsidiaries of U.S. business

firms (e.g., Coca Cola).

global trade barriers. Such things as tariffs, quotas, andimport controls imposed by a country that wishes to protect its

home market from foreign competition. The purpose of the

General Agreement on Tariffs and Trade (GATT), established

in 1947, was to lower trade barriers and promote trade. Itsfunctions were taken over in January 1995 by the World Trade

Organization.

gross national product. See Glossary, Topic 3.

import controls. Tariffs, duties and other restrictions placed

on the importation of goods and services from abroad. Coun-

tries use import controls to protect against foreign competi-

tion.

III Income distribution. Manner in which personal income(salaries, investments, etc.) is distributed among the various

income groups in a nation.

inflation. A persistent rise in the cost of goods.

infrastructure. Foundation on which a nation's economydepends. Examples of what constitute infrastructure are roads,

railroads, ports and power facilities.

International Bank for Reconstruction and Development(World Bank). International organization originally intended

to assist with the reconstruction of war-torn economies. The

World Bank was established at Bretton Woods in 1944. Along

with the IMF, the World Bank provides long-term financial

assistance for development projects and programs.

International Monetary Fund (IMF). International institu-tion based in Washington, D.C., and created under the Bretton

Woods system for the purpose of 1) seeing that nations follow

a set of agreed rules of conduct in international trade andfinance; and 2) providing borrowing facilities to nationsfacing balance-of-payments deficits. The IMF gets its funds

from reserve deposits of its member countries.

III market-oriented reforms. Reforms designed to introduceprofit incentives and the principles of supply and demand into

economic transactions.

nongovernmental organizations (NGOs). National and in-ternational private foundations and voluntary associationsusually designed to deal with specific issues or areas ofconcern. NGOs devote their efforts and resources to address-

ing or influencing national or international problems.

trade balance. The relationship between exports and imports

of goods. It does not include capital transactions or payments

for services. If the level of exports is equal to the level ofimports, trade is equal, or balanced. If a country imports more

than it exports, it has a trade deficit. If it exports more than it

imports, it has a surplus.

yield. The rate of return derived by dividing the annual return

from an investment by the amount of the investment. Forinstance, a $10,000 investment in common stocks that pays

$500 in annual dividends (earnings) yields 5%.


1.2E

China, Taiwan, Hong Kong:U.S. challenges

What direction will China take after the death of DengXiaoping?

Should the U.S. link human-rights issues in China to trade?

What is the outlook for increased U.S. trade with a`Greater China'?

Can free enterprise succeed under a Communist government?

ARTICLE SUMMARY

ORTY-FIVE YEARS have passed since the establish-ment of the People's Republic of China (PRC).

The country, with its 1.2 billion peoplea fifth of theglobe's populationhas emerged as a vigorous con-tender among the world powers. For the last 13 years,its economic growth rate has exceeded 9%. The coun-try has made major strides toward a market economy.Foreign capital has been wooed and foreign investorshave flocked to China's special economic zones. Whatdoes the future hold for China after the current leader,Deng Xiaoping, who is 90 and in poor health, leavesthe scene? Will economic liberalization and China'sintegration into the international economic systemcontinue? Will China move toward a military state,which uses its strength to project its power? Or willChina fragment? A subsidiary set of issues concernstwo ethnically Chinese entities: Hong Kong, whichwill cease to be a British colony in 1997, and thebooming island economy of Taiwan. How should theU.S. respond to the emergence of a more vigorousChina? And how will that affect U.S. relations withTaiwan and Hong Kong?

ACTIVITY ONEOverviewNo one can reasonably predict what the People'sRepublic of China will be like at the beginning of the

21st century. Napoleon's "sleeping giant" no longersleeps. Awake and in motion, China is followingvarious paths toward its goals and objectives. Itsultimate choice of direction will have an importanteffect on its own development, on its neighbors inAsia and on the rest of the world.

The issues China must resolve are of such signifi-cance and complexity that they threaten to change thebasic structure of the state. Questions have and willcontinue to be raised about what kind of society Chinashould be. The ultimate role or influence of such ideasor principles as Marxism, free-market economics,human rights, regionalism, militarism, the welfarestate, population control, "Greater China," and worldtrade and investment, among others, is uncertain un-der the stewardship of an aging leadership that willsoon be replaced. As one era ends, it is not clear whatthe next will bring: a continuation of the status quo, anationalist military state or a fragmented country. Onething is certain: China faces many daunting challengesand many difficult choices.

China's economic growth has been spectacular.Whether it can be sustained is the question. Beginningin 1979, the leadership of Deng Xiaoping broughtabout the loosening of state control of the Chineseeconomy and a move toward a free-market structure.The country's outstanding economic development hasled some analysts to believe that China will be the


TEACHER S GUIDE

world's largest economy very early in the 21st cen-tury. Foreign investors have flocked to China. Specialeconomic zones in coastal areas have helped Chineseentrepreneurs achieve astonishing results, contribut-ing to a surge in production, trade and consumption.Improved economic and political ties with Hong Kongand Taiwan have generated investments and otherpositive economic arrangements for the PRC. Collec-tive fanning has been replaced, and grain productionhas improved as per capita farm income has risen. Thepercentage of Chinese who live in poverty, withoutadequate food, clothing and housing, has droppedsignificantly in merely one decade.

These economic changes have generated forces andcreated conditions that threaten to disrupt or destroy thestate socialist system. There is no longer an "iron ricebowl"guaranteed food, housing and health servicesas state enterprises break down under the new competi-tive situation. The social order is steadily eroded byunrest brought about by a surplus of workers, risingunemployment, a lack of opportunities for the young,explosive population growth and migration to crowdedurban areas. Increases in crime, corruption and ineffi-ciency are further exacerbated by an unwieldy bureau-cracy, uneven development, bitter rivalries and faction-alism as well as serious regional disputes.

The future direction of China holds many uncer-tainties. One of the unknowns is the role of the mili-tary. The People's Liberation Army helps maintainorder, manufactures a wide variety of products andreceives income from factories, farms, transportationnetworks and arms sales. The army could influence thedirection in which China will head.

What factors will determine the direction of China?How will new leadership be able to guide this nation?What programs, ideologies or issues will shape thedestiny of this rapidly changing society?


1. Describe and contrast changes affecting thePRC.

2. Explain the difficulty of predicting the futurecourse of this nation.

3. Suggest and evaluate various approaches Chinamay take to develop and maintain its security.

Materials"Handout on China" (see page 40), chalkboard, chalk


ProceduresDivide the participants into six groups representing a)capitalists (entrepreneurs), b) Marxists, c) People'sLiberation Army, d) reformers, e) students and youth,and f) workers.

Give them the "Handout on China." Allow themabout 20 minutes to prepare a group profile and astrategy for influencing the future of China in theirgroup's best interest. Ask them to be prepared to seekdeals or assistance from the other groups in order toensure the success of their strategy.

After they have completed this work, ask eachgroup to present its vision of what it believes would bebest for China. Ask each group what it believes mustbe done and how it would go about providing themeans to carry out its plans. Ask each group whichother groups, if any, it would rely on and whataccommodations would have to be made to improvethe chances for success. Summarize the responses onthe chalkboard and, after all groups have finished, askthem to study the scenarios that have been presentedand compare them.

After giving them time to form an opinion, ask themwhich vision they believe is most likely to succeed inChina, making sure they cite ideas or information thathas been presented by the groups. Try to get them tocome to a consensus as to the one or two most likelyscenarios.

End the discussion by asking them what additionalinformation they would need in order to have a morereasonable assurance that their scenario will occur. Ifthey have not stated an opinion, ask them what influ-ence other nations will have on China's development,especially in matters of trade, investment, humanrights and arms control.

ACTIVITY TWOOverviewTo the rest of the world, the PRC, a populous nation,is a highly visible reminder of many of the world's

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concerns in the post-cold-war period. Since its found-ing in 1949, this revolutionary Marxist state hasemerged from desperate poverty, underdevelopmentand relative isolation to become a significant factor inworld affairs, particularly in economic development,population control, free-market conversion, worldtrade, human rights, arms control and the future ofAsia.

The successes or failures of China's developmentprograms can and will be cited throughout the world,as impoverished nations grapple with similar prob-lems on a smaller scale. The fact that China hasadopted free-market remedies for economic growthand development while ostensibly maintaining a Com-munist political system makes its example even morenoteworthy. Of course, part of the reason why thecountry may or not succeed will rest with its struggleto control a rapidly growing population, a difficultymany countries in the developing world share.

China's economic rapprochement with Taiwan andHong Kong in coming years could lead to a GreaterChina. It would become America's third-largest tradingpartner, an economic powerhouse and a serious rival toother "Asian tigers." The creation of special relation-ships with Hong Kong and Taiwan could help resolvetwo difficult situations that have generated friction andenmity between the PRC and its would-be rivals,particularly the difficulties it experienced with the U.S.over Taiwan. China's human-rights record has drawnattention and concern as well in the West. The U.S. hastried unsuccessfully to link human-rights issues inChina to trade. Whether this failure to influence Chinawill have repercussions on the protection of humanrights elsewhere in the developing world remains to beseen.

The issues of militarism, arms production, particu-larly nuclear arms and materials, and arms exportsconcern the U.S. and the nations that share China'sborders. While the military power of China is weak incomparison with the U.S., some analysts believe thatit may pose a threat to U.S. interests in Asia. The PRChas been upgrading its military capabilities since 1989by increasing its defense spending. In addition todisputes with Vietnam and India, China has backedNorth Korea and has helped fuel an arms race betweenIndia and Pakistan. Nuclear testing and sales of con-ventional arms, coupled with fears that a militarilyaggressive leadership may be emerging, suggest the

possibility of a military threat from China. Certainlythe nations of Asia, as well as other parts of the world,will have to watch political and military developmentsin China with care.

In addition to its world-class economic status,China has grown as a political power. It holds one ofthe five permanent seats on the UN Security Council.The U.S. must now reassess developments in China todetermine what action should be taken in the post-cold-war era. For the U.S., which wishes to promotedemocracy, capitalism and human rights, increasetrade and improve international relations, reduce ar-maments and halt nuclear proliferation, the creationand management of successful relations with the PRCare important goals.

How should the world approach the PRC? Whatobjectives should be emphasized in dealing with thiswaking giant? Should economic and social matters belinked to political and military affairs? What roleshould the U.S. play?


1. Tell why economic and social development,human rights, armaments and military affairsin China are important issues in the post-cold-war era.

2. Describe ways in which the U.S. and othernations may influence the development ofdemocracy, capitalism and human rights inChina.

3. Explain the role the U.S. should play in China'srelations with Asia and the world community.



ProceduresBegin the discussion by describing the post-cold-warera. Point out how the demise of the Soviet Union hasleft the U.S. as the world's only superpower and thatthe U.S. economy is still very powerful in the world.


X31

IIACI1ER S GUIDE

Then write the following on the chalkboard: "promot-ing democracy," "free enterprise," "protecting humanrights," "controlling nuclear and conventional weap-ons," "population control" and "improving worldtrade."

Ask the participants if they believe that the itemslisted on the chalkboard are important issues in today'sworld. Ask them whether they believe they are impor-tant enough for the U.S. to promote them activelythroughout the world. Ask them how this could ben-efit the U.S. and the world.

Turn the discussion to the PRC. Describe how theTiananmen Square events shocked the world andpoint out that China is a Communist state that couldembrace new authoritarian measures and reverseecomonic reforms after the old guard is gone. Askthem if they believe this would present a serious threatto the U.S., Asia or the world. Ask them if the U.S. canor should do anything to prevent this and to promotecontinued movement toward reform and liberalizationin China. Ask them if the U.S. should rely on eco-nomic incentives to influence China. Ask them spe-cifically why they believe the U.S. would or would notbe wise to use trade relations as a means to influenceChina's human-rights policy.

Ask them why China's military policies have gener-ated concern in Asia and the U.S. Ask them to describespecific policies or actions by China that could beperceived as a threat. Get them to explain why China'smilitary could pose a threat to developments withinChina as well. Ask them what efforts the U.S. may beable to make to diminish the importance of China'smilitary in domestic and international affairs. Ask themwhat initiatives should be taken to affect China's nuclearrole in the world. Again raise the question as to whetheror not the U.S. should use economic incentives toinfluence China in these matters.

Ask why China's permanent membership on theUN Security Council could be an important factor ininfluencing how the U.S. deals with the PRC on manyissues. Ask them how China's position at the UN mayinfluence its actions and its reactions to U.S. policyinitiatives in the future.

End the discussion by asking them if they wouldagree or disagree with a statement that many of theglobal issues that are important to the U.S. in the post-cold-war era seem to involve China. Ask them if theybelieve U.S. success or failure in meeting these chal-lenges in China will have an effect on U.S. initiativesin other parts of the world.

GLOSSARY

authoritarianism. A political system in which power isconcentrated in the hands of a leader or group who is notresponsible to the people or responsive to the popular will.

Human Rights Watch. A U.S.-based international organiza-

tion composed of five regional offices that is concerned with

monitoring and promoting the observance of human rights.

Mao Zedong (1893-1976). Chinese Communist leader; presi-

dent of first Chinese peasants' union (1927). After defeating

the Nationalists in China's civil war in 1949, Mao founded the

PRC. He remained chairman of the Chinese Communist party

until his death in 1976.

Solidarity movement. Led by Lech Walesa, the movementoriginated in 1970 and grew out of demonstrations by theconfederation of Polish independent trade unions against se-

vere economic hardships under the Communist regime. The

movement grew through the 1970s and represented, at itspeak, more than 10 million industrial workers. It was banned

by the government in 1981 but legalized in 1989. It success-

fully fought for national elections and played a major role in

ending Communist rule in Poland.


.04

ACTIVITIES

Immigration: anend to open doors?

Can the U.S. close its doors to immigration?

Should the U.S. deny benefits to illegal immigrants?

Is it in the interest of the U.S. to provide asylum to religiousand political refugees? economic refugees?

ARTICLE SUMMARY

AS POPULATIONS IN the developing countries growand economies and resources in them decline,

more and more people are making their way to thericher, more-industrialized countries. The majorsources of immigrants to the U.S. in recent years havebeen the Caribbean, Mexico and South America. Inaddition to immigrants, in 1994 refugees from oppres-sion and economic privation in Haiti and Cuba tried toreach U.S. shores. At the same time, North Africansand East Europeans are flocking to Western Europe.The article looks briefly at the conditions that pushpeople to emigrate and at the reactions of destinationcountries in Western Europe, especially Germany. Italso examines the evolution of U.S. policy towardimmigrants and discusses the current choices facingU.S. policymakers. Should the U.S. try to seal itsborders? Are immigrants beneficial or detrimental?To what rights and benefits should immigrants beentitled? Should illegal immigrants receive any ben-efits? Ready answers are elusive, but examining thesituation in the U.S. and some of the other recipientcountries may provide some insight.

ACTIVITY

OverviewOne indication of the global disorder and uncertainty

that exist today is the worldwide movement of thou-sands of immigrants seeking to start a new life inanother land. This phenomenon can be found in everyregion of the world. S ince the early 1980s there has beena steady increase in the number of countries wheresignificant numbers of people have chosen to exercisetheir internationally recognized legal right to leave onenation for another in order to find a better life.

This movement involves many factors: some "pull,"some "push." The pull factors that attract immigrantsinclude opportunities for employment or better livingstandards and relatives or communities of fellow coun-trymen in the chosen country who can ease the transitionand offer support. Some societies even welcome thehighly trained, well-educated immigrant for political aswell as economic reasons.

For other immigrants, push factors, including eco-nomic hardship, social upheavals, serious civic disor-ders and regional, ethnic and religious conflicts, carrymore weight. These elements have increased in inten-sity as the cold-war world order dominated by twosuperpowers has faded. Harsh political repression andpersecution are still other reasons for departure. Thusthe world has witnessed the migrations of Haitians,Cubans, Salvadorans, Algerians, Egyptians, Palestin-ians, Chinese, Vietnamese, Yugoslavians and Rus-sians, among others, to neighboring states or otherareas perceived to be safe or full of opportunity.


.133

TEACHER S GUIDE

Just as increasing numbers have seen fit to exercisetheir right to migrate, the number of nations exercisingtheir equally recognized right to refuse entry to mi-grants or refugees has also been rising. Several rea-sons, beyond the sheer number of migrants, accountfor this development. In the past, many of the ad-vanced nations welcomed immigrants. Aside fromhumanitarian and ideological concerns centering onthe cold war, industrialized nations sought workers tofill jobs that native workers would not take. Duringtimes of prosperity and expanding economies, coun-tries accepted immigrants more readily. However, inperiods of economic downturn when the need forunskilled workers diminished, concerns about thesocial and political effects of embracing large num-bers of poorly educated or underskilled outsidersgrew. Anti-immigrant sentiment led to legislation,discrimination, even violence, as nations attempted tonarrow or close the doors of opportunity.

The U.S. is one of the industrial nations where anti-immigrant sentiment is on the rise. Growing numbersof Americans are worried about how the large influxof recent immigrants, legal and illegal, will affect jobs,the cost of social services and taxes. They are alsoconcerned about the effect of multiculturalism onAmerican society and its values. Recent initiativessuch as Proposition 187 in California and the 1994crime bill in the U.S. Congress have been examples ofcitizen backlash.

While much of this concern is directed against illegalimmigrants, some are calling for a moratorium on allimmigration. They argue that the U.S. no longer needslarge numbers of unskilled workers and that there aretoo many people entering an already crowded country.

This anti-immigrant backlash in the U.S., a nationof immigrants, is not unprecedented. Periods in whichsimilar sentiments were expressed abound in U.S.history. In general, the most recent arrivals mustovercome the greatest resistance or prejudice in orderto find a place and be accepted in American society.What may be different today is the changing structureof the economy in post-industrial America, coupledwith the demographic mix of the more recent immi-grantsi.e. a greater influx of Africans, Asians andCaribbean peoples. Americans may have reached thepoint where they want to close the doorsif onlytemporarilyto all immigrants.

How will increasing immigration affect countries?How should nations deal with it? How should the U.S.react to immigration at home and abroad? What roleshould the U.S. play in trying to deal with this phe-nomenon?


1. Tell why immigration has increased signifi-cantly around the world in recent years.

2. Explain why the U.S. and other industrializednations have recently begun placing restric-tions on immigrant groups.

3. Discuss the steps to be taken for the U.S. andother nations to handle the issue ofimmigration effectively.



ProceduresBegin the discussion by writing the following on thechalkboard:

The U.S. is a nation of immigrants:

a) It must not turn its back on immigrants in thefuture.

b) Changing U.S. conditions and global patternsof immigration require the U.S. to reduce orhalt further immigration, both legal and illegal.

Ask the participants to state which of these state-ments best serves the domestic interests of the U.S. andwhy. List the reasons they offer in support of their ideasunder the respective statements on the chalkboard.

Ask them if the two positions apply equally to legaland illegal aliens in the U.S. Ask them what theybelieve the difference is or should be concerning legaland illegal aliens and what, if anything, should be doneto manage either group. Ask them if they would preferto amend or add a different statement to the chalkboardconcerning immigrants in the U.S. and make anychanges they suggest. Then ask the participants to


X34

f EACHER S GUIDE

indicate which statement they support by a show ofhands. Write the numbers of supporters for each groupon the chalkboard.

Turn the discussion to a global perspective on immigra-tion. Ask the participants why so many people are emigrat-ing at the present time and what major global conditions arefueling this increase. Use examples such as Cuba, Haiti,Yugoslavia, Hong Kong, etc. to find out what influencethey believe the U.S. or other nations might exercise to easeor Ulm back immigration. Ask them if a worldwide effortcould be mounted and, if so, what sort of policies ormeasures should be adoptedand by whomin order toalleviate this problem Ask them if they believe the U.S. hasa special role to play as a "nation of immigrants." Ask themto indicate what they believe the role of the U.S. should be

in such an effort and how they believe domestic policyregarding immigrants would or would not affect this role.Ask them if they believe U.S. long-term interests inencouraging democracy, increasing world trade and spon-soring economic development should or could be linked toa domestic policy toward immigrants in the U.S.

End the discussion by asking them to take anotherlook at the positions and arguments on the chalkboard.Ask them why they still maintain the position they heldat the time or, if they have changed, to give the reasonswhy. Ask the group to indicate again which positionthey hold by a show of hands. Write these figures onthe chalkboard and compare them with the previouscount. Ask them why they believe their views did ordid not change significantly.

GLOSSARY

Guantinamo. U.S. naval base in Guantanamo Bay, Cuba.During the mass exodus of refugees headed for the U.S. from

Haiti beginning in 1992 and from Cuba in 1994, it served as

a refugee-processing center. Cuba has long contended that the

U.S. base constitutes an illegal occupation of Cuban territory.

Irish Immigration Reform Movement. A political lobby ofIrish who came to the U.S. in the 1980s as tourists and stayed

after their visas expired; aimed at persuading Congress tolegalize their status and increase immigration from Ireland.

The movement achieved a small success with the passage of

the Immigration Reform and Control Act of 1986 and was a

force in the passage of the Immigration Act of 1990.

Islamic fundamentalist. A member of a movement thatopposes the spread of Western cultures and values in Islamic

societies as contrary to the basic teachings of Islam.

Jordan Commission (U.S. Commission on ImmigrationReform). Established in 1992, the commission reviews and

evaluates U.S. immigration policy and submits recommenda-

tions to Congress. Chaired by former Congresswoman Bar-

bara C. Jordan (D-Tex.), the commission has proposed setting

up a computerized register of names and social securitynumbers of all citizens and aliens authorized to work in the

U.S. in order for employers to check workers' eligibility.

Third World. Term that refers to economically less-devel-oped countries, most of which gained independence afterWorld War 11.

United Nations Population Fund (Unfpa). See Glossary,Topic 1.


1a 3 5

0"'""

Promoting democracy:America's mission?

Is it in the U.S. interest to promote democracy abroad?

Do the rights of the individual supersede the needs of society?

Is the U.S. concept of democracy relevant only to the West or has ituniversal appeal?

ARTICLE SUMMARY

HE COLLAPSE OF the Soviet Union has compelledT U.S. policymakers to reconsider U.S. foreignpolicy principles and goals, including the role the U.S.assigns to promoting democracy abroad. According topolitical scientist Michael Doyle, democratic govern-ments are less likely to go to war against each other.Therefore, promoting democracy appears to serveboth U.S. ideological and security interests. Is thedemocracy the West would promote the only model,or do alternatives exist? Does a liberal democraticsystem go hand in hand with a successful marketsystem, or is one possible without the other? Shouldthe U.S. give priority to expanding Western-styledemocracy? What commitments would this entail?What are the alternatives? These are some of the issuesexplored in political scientist Richard Ullman's ar-ticle.

ACTIVITY

OverviewWhatever doubts may exist about the cost or probablesuccess of a U.S. commitment to the promotion ofdemocracy in today's world, such a goal is consistentwith the history and nature of American beliefs andliberal democratic practices. There are some compel-ling reasons why such a commitment may offer impor-tant benefits to the U.S. and to the world.

The U.S., the world's oldest continuous democraticstate, has sought reassurance in the companionship ofas many liberal democratic states as possible. Thispolicy is important not only to promote U.S. securityand advance American economic and political inter-ests but, also, to encourage greater peace and harmonythroughout the world.

History shows that democratic states do not go towar against one another. There are several reasonswhy this is so. Democratic states are transparent.Information on policies or actions a democratic statemay be planning to implement is available because ofthe way these states conduct their political and eco-nomic affairs. Thus democratic states are subjected toinfluences and pressures from both foreign and do-mestic interest groups. Cross-border ties, commonconcerns or enterprises, coupled with institutionalizednorms of negotiation and compromise, greatly in-crease the tendency of democratic states to worktogether to reduce tensions and to ease conflicts thatmay occur with other democratic societies.

From the founding of the country, Americans havedebated the best way to ensure the survival of the U.S.Discussion of foreign policy in early American historycentered on questions about how a young, weak U.S.could avoid becoming entangled in the actions andintrigue of European power politics. Since the Span-ish-American War (1898), when it acquired the Phil-

TEACHER'S GUIDE 1995 330 0

.1 a Li

ippines, the U.S. has intensified its promotion ofdemocracy and human rights to the rest of the world.Presidents Woodrow Wilson and Franklin D. Rooseveltrespectively spoke of "keeping the world safe fordemocracy" and "the four freedoms," as goals orobjectives to guide the combatants of World Wars Iand II. Later, during the cold war, the U.S. spoke of thefree world, although it often wound up supporting orpaying lip service to antidemocratic regimes or ac-tions in its long struggle against the Soviet Union.Today, with the elimination of the Soviet threat andthe end of the cold war, the U.S. is the world's onlymilitary superpower and the most powerful economyin tht world. This presents it with the unique opportu-nity to further the cause of democracy and, perhaps,bring peace and security to many regions of the world.

There are various ways this may be done. The U.S.can provide technical resources and funds for politicaldevelopment. Assisting nations in constitution-draft-ing and law-making, creating tax systems, election-eering, organizing free mass mediaestablishing theinfrastructure necessary to a constitutional democ-racycan reap many dividends at a much lower costthan military occupation or coercion. Funding for theNational Endowment for Democracy (NED) and itsfour independent subsidiaries provides a means fornetworking and cross-border ties that are essential tounderstanding among various peoples.

Concerns can be raised about whether the U.S. canor should impose its own values on othersnot tomention the probability of success for these efforts.Cultural differences may work against an American-style democracy, which places a premium on therights of the individual. Human-rights abuses, newglobal threats, whether they be environmental, publichealth, resource depletion or others, along with a lackof sufficient traditions or proper conditions to nurturedemocratic institutions, can deter the development ofdemocracy and perhaps threaten U.S. security.

What role should the promotion of democracy playin American foreign policy in the post-cold-war era?What means can be used to promote democracy in theworld? How will such an effort affect the U.S. and thepeace of the world?


1. Explain why promoting democracy is part ofthe American approach to foreign policy.

2. Describe why the promotion of democracymay help to create peace and security for theU.S. and the world.

3. Evaluate the chances for success or failure for thespread of democracy in the post-cold-war era.



ProceduresBegin the discussion by quoting the end of Lincoln'sGettysburg Address: "...that government of the people,by the people, for the people, shall not perish from theearth." Ask them what they believe this statement,repudiating the slavery provision in the U.S. Consti-tution, means for Americans and for American de-mocracy. Ask them if they believe this "new birth offreedom" that Lincoln defined in the address shouldapply only to the U.S. or if it should apply to the worldat large. Get them to make a definitive statement as towhat they believe should be the proper role of the U.S.with regard to safeguarding freedom, democracy andhuman rights in today's world.

Turn the discussion to the problems of the post-cold-war era. Ask them to list what they believe are themajor international problems facing the world. Writetheir responses on the chalkboard and get them toagree on the most important ones listed. Ask them togive reasons why they believe these problems are themost important to the U.S. as well. Divide the partici-pants into groups and assign each group a problem.Ask them to devise a solution that they believe theU.S. can successfully implement. Ask them to con-sider what the social, political and economic costs ofsuch a solution might be. Give them about 15 minutesfor this task.


ILACHEIZ S GUIDE

Bring the groups together and ask each one for its"solution" to the problems listed on the chalkboard.Be sure to ask each group to indicate the costs andchanges involved in implementing the solutions.After they all have finished, ask the entire group tospeculate on the chances for success or failure ineliminating these problems.

Return the discussion to the issue of promoting democ-racy in the world. Ask them ifthete is a connection betweendealing with these problems and promoting democracy,freedom and human rights in the world. Ask them whatthese connections might be and if it would be worthwhile

to pursue democratic goals and approaches as a means tomanage or eliminate the problems they have listed. Askthem how this could best be done and whether or not theU.S. has a special, global role to play as the world's mostsuccessful and continuously democratic state. Get them todescribe how the U.S. is already promoting democracy inthe world and ask them if it can do more.

Close the discussion by asking them what the effectwould be if the U.S. discontinued its promotion ofdemocracy. Ask them to give reasons why they believethat democracy would or would not survive in theworld if it did.

GLOSSARY

M authoritarian states. See Glossary, Topic 6, authoritarianism.

M contras. The collective name for several counterrevolutionary

groups opposed to the Sandinista government of Nicaragua in

the 1980s. The contras operated in Nicaragua and along itsborders. U.S. military aid for the contras ended in 1988.

Fulbright grants. Named for former U.S. senator from Arkan-

sas and chairman of the Foreign Relations Committee, thegrants underwrite the exchange of students between the U.S.and over 100 other countries.

Leninism. Based on the theories and practice of the Russianrevolutionary Vladimir I. Lenin (1870-1924), who established

socialism in the U.S.S.R. under the dictatorship of the Commu-

nist party.

Marxism. Based on the theories of Karl Marx and FriedrichEngels, this economic philosophy calls for the rejection ofcapitalism and the creation of a centrally controlled economy.

McCarthy, Joseph (1908-57). Republican senator from Wis-

consin (1947-57) who used his office recklessly to accuseindividuals of subversive activities and exploit the public'sfear of communism. McCarthyism is commonly used as a

synonym for witch-hunting.

III Third World. See Glossary, Topic 7.

totalitarian state. A state in which the ruling party is the sole

source of authority and the sole initiator of change. Com-monly used to describe a Communist or Fascist state.

transnational corporations. Corporations whose ownershipor operations extend beyond the geographic boundaries of a

single nation.

Voice of America. Broadcasting service of the U.S. Informa-

tion Agency, established in 1953. During the cold war, itbroadcast from stations in various parts of the world to Com-

munist countries. Since the collapse of communism in theformer Soviet Union, its operations and funding have been cut.


1 Q

Handouton the U.S. and the UN

The United States190-1921

proclaims U.S. neutrality in war between major European powersPresident Wilson outlines Fourteen Points in "Peace Without Victory" speech including the establishment ofan international organization (League of Nations) to prevent future wardeclares war on Germany following submarine attacksSenate refuses to ratify peace treaty; U.S. fails to join League of Nations

1921-1940proclaims the end of World War I by joint resolution of Congresssigns treaties to limit military presence on high seasfails to join the World Court at the Haguesigns treaty that "outlaws" warNeutrality Acts bar exportation of munitions to nations at warPresident Roosevelt declares IJ.S. neutrality

1941-1949issues the Atlantic Charter with Britainjoins Allied war effort against Axis powers after Pearl Harbor attackjoins the United Nations, created after World War IIjoins the World Bank and IMFstates the principle of Soviet containmentassists European recovery with U.S. Marshall Planjoins the North Atlantic Treaty Organization

1950-1989sends troops to oppose North Korean invasion of South Koreasponsors unsuccessful Cuban invasion at the Bay of Pigssends combat troops and conducts bombing campaigns to oppose Communist insurgents in Vietnamengages in a massive military buildup to oppose Soviet expansionsends troops to Grenada and Lebanonsends troops to Panama

1990-Persian Gulf (Operation Desert Storm)BosniaSomaliaRwandaHaiti


33

HANDOUT it2

Handout onNuclear Issues

Circle your group:

U.S. Britain Belarus Iran IndiaChina Kazakhstan Iraq PakistanFrance Russia Israel

Ukraine

North Korea

AggressiveTendencies

SecurityConcerns

NuclearStatus

PossibleStrategyfor NuclearDisarmament

7 4 GTEACHER'S GUIDE 1995 37

1

HANDOUT # 3

Handout on the Middle East

Circle the group to which you have been assigned. Consider the issues below and develop solutions thatwill best serve your group's interest.

Palestinian IsraeliIssues1. Israeli security

Hamas

2. Increased Palestinian administrationof West Bank

3. East Jerusalem

4. Jewish settlements in occupied territories

5. Palestinian land claimsPalestinian refugees

6. Palestinian statehood


X41

HANDOUT #4

Handout on Global Finance

Circle the group to which you have been assigned and profile your group using the following criteria:

Advanced Emerging Nations Converting Less-Developed (Poor)Nations Nations from Communism to Nations

Free-Market Economy

Economic status

Sources of capital

Trade development

Investment potential(rich, poor, mixed,industrial, pre-industrial, etc.)


HANDOUT t/ L)

Handout on China

1. Name of group

2. Group's major problems or concerns

3. Group's political and economic goals

4. Description of society the group desires

5. Group strategy or solutions needed to achieve goals

6. Allies of your group

7. Enemies of your group


I.

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Milted States/foreign Policy

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This latest FPA cartoon book featuresmore than 200 cartoons by America'sleading cartoonists, past and present,accompanied by text that sets the sceneand offers a vivid portrait of U.S. politicsat home and abroad.

240 Pages $12.95

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For 75 years, the Foreign Policy Association has served our

nation by educating our public and stimulating informed debate

on the complex issues we face. With the cold war ended and a

new era upon us, your role is even more important. As we seek to

meet the challenges of this momentous period of change, I

congratulate all of you for this importan: contribution.

Bill Clinton

The Foreign Policy Association by providing a balanced and

reasoned forum for the discussion and understanding of complex

foreign policy issues renders an invaluable service to the American

people. The Association is to be commended for its work.

George Bush

Foreign Policy Association729 Seventh Avenue

New York, New York 10019

(212) 764-4050 Fax: (212) 302-6123 (800) 628-5754

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ISBN 0-87124-161-'51195'

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AVAILABLE FROM - ERIC

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