Global Policy Forum

2000

A deep financial crisis continued to cripple the UN in 2000. Member states owed the organization $2.3 billion in unpaid dues at the end of December, considerably more than the $1.1 billion regular budget and $500 million more than the debt a year earlier. Global Policy Forum promoted public awareness of this crisis and sought solutions.

The UN has no authority to borrow, so it owes very large sums to suppliers and to member states that have provided peacekeeping forces. Secretary General Kofi Annan and his team have been forced to pare budgets that are already inadequate, damaging many vital UN programs and damaging UN credibility. Rising peacekeeping budgets began to put additional pressure on the UN during 2000.

The United States government is primarily responsible for the crisis, because of large arrears in its dues payments (about $1.3 billion or 58% of the total at Annual).

Though arrears to the regular budget have declined (see graph), peacekeeping arrears have grown rapidly, so that overall arrears have continued to move upwards, keeping the UN in a constant state of penury. Other major governments deepened the crisis by cutting contributions to key development and humanitarian funds. Monies for the UN Development Program, the International Labor Organization and other agencies fell alarmingly. In some countries, refugees starved because of shortfalls in UN relief budgets. The sums involved are very small in terms of overall government expenditures. The UN's total regular budget of $l.1 billion is less than the budget of the Tokyo fire department.

Research, Analysis and Data

Global Policy Forum carried out research and analysis on the financial crisis in close consultation with the United Nations Secretariat and a number of scholars and experts. Klaus Hüfner of the Freie Universität in Berlin and Michael Renner of the Worldwatch Institute particularly helped GPF by sharing their own research and data. That input, along with GPF's strong in-house research capacity, resulted in work of a high quality.

During the year, GPF further expanded its data analysis and extended its series of graphs to include UN agencies. The UN finance materials now on the GPF web site are recognized as definitive and often reproduced in books and articles. Missions, journalists and the UN itself make use of this data as a unique resource.

Advising Partners and Media Outreach

We gave many interviews to the media and advised NGO partners on UN financial issues, especially during the Millennium Summit in September and as member states negotiated a new rate of dues assessments during the fall. We often expressed our doubt about the United States "Helms-Burton" deal to reduce US assessment in exchange for a promise of partial payment of US arrears. This doubt was based on the illegality of members making policy demands in exchange for payment of dues. It was also based on skepticism that the deal would be honored on the US side.

The extreme complexity of the negotiations in the UN Budget Committee and the requirements imposed by the US Congress proved a challenge to GPF. Our analytical work helped the press, the NGO community and the public sort through this policy thicket.

Global Taxes

GPF's work on the finance of international public institutions grew out of our work on the UN financial crisis. Some analysts have proposed that revenues from global taxes or fees could be used to help fund the UN and to fund other global policy purposes at the same time, such as development finance and environmental protection. Further, the fees or taxes can have positive policy results independent of revenue-raising. The Currency Transac-tion Tax or "Tobin Tax" on foreign exchange, for instance, can slow down financial speculation, and an Environmental Tax or "Carbon Tax" can reduce emissions and slow or halt global warming.

GPF has actively promoted the global tax idea and monitored global discussions and negotiations. GPF has also produced original analyses, commentary and proposals to promote better understanding of the issues among policy makers and the public.

During 2000, we welcomed government statements favoring global taxes from India, Brazil, Sweden and a number of other countries. We concentrated our work primarily on developing our web resources. We monitored not only global initiatives but also related policy at the national and regional level, including proposals for globally or regionally-harmonized taxes that are levied nationally, such as the European Union proposal for a tax on airplane fuel.

During the year, we participated in several UN briefings and discussions, and we began planning for an international roundtable on this subject in New York in 2001 with our friends from the World Economy, Ecology and Development Association (WEED) and the Heinrich Bí¶ll Foundation.

Many in the United States are inclined to dismiss the practical possibility of implementing global taxes and fees because of the hostility of Congress and the Administration. But at GPF we feel that economic globalization will increasingly require strong international organizations and that only global taxes and fees can provide a solid financial basis in the long run to pay for them. We also believe that these taxes and fees can have substantial positive policy outcomes in their own right.

A grassroots campaign is already gaining momentum in Europe, Canada and even the United States. Growing interest among NGOs, experts, parliamentarians and governments show that the issue has an important future.

Global Policy Forum is supported primarily by contributions from generous individuals who join as members. GPF also receives grants from foundations and partner institutions. GPF is incorporated in the State of New York, registered as a charitable organization and recognized by the US Internal Revenue Service as a not-for-profit, tax-exempt organization under section 501(c)(3) of the revenue code.

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