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53901. The International Financial Architecture

Author:
Jeffrey A. Frankel
Publication Date:
06-1999
Content Type:
Policy Brief
Institution:
The Brookings Institution
Abstract:
The recent financial crises in many emerging market economies have raised anew questions about the appropriate exchange-rate regime and the use of capital controls as policy instruments. The use of both mechanisms should be tailored to each country's unique circumstances. Fixed exchange-rate mechanisms, such as dollarization (adopting the dollar as legal tender in place of the national currency), are suited to small open economies or those desperate to import monetary stability. Larger economies, such as the European Union (EU) and the United States, should allow their currencies to float. Intermediate regimes that fall between fixed- and floating-rate regimes—such as bands, baskets, and crawls (See Figure 1 for definitions)—are still appropriate for some countries. Certain well-targeted restrictions on the composition of capital flows might be appropriate for some emerging-market countries as temporary measures when inflows are particularly high.
Topic:
Economics and International Trade and Finance
Political Geography:
United States and Europe

53902. NATO at 50: The Summit Beyond

Author:
Ivo H. Daalder
Publication Date:
04-1999
Content Type:
Policy Brief
Institution:
The Brookings Institution
Abstract:
At the threshold of a new century, NATO needs a new purpose. A NATO maintained solely as a hedge against an uncertain future (including a possibly resurgent Russia) will become increasingly marginal to the interests of its members. A shift in emphasis to defending common global interests risks magnifying discord among Alliance members. Instead, NATO's purpose should now be to extend security and stability to all of Europe. This will require placing more emphasis on the ability to conduct crisis management operations in the region and taking practical, visible steps to keep the door to NATO membership wide open.
Topic:
Security, NATO, and International Organization
Political Geography:
Europe

53903. The Case Against Tax Cuts

Author:
William G. Gale and Alan J. Auerbach
Publication Date:
03-1999
Content Type:
Policy Brief
Institution:
The Brookings Institution
Abstract:
Emerging federal budget surpluses have sparked calls for large-scale tax cuts that would be irresponsible and counterproductive. Surpluses over the next ten years are based on optimistic assumptions regarding revenues and spending. Even if they do materialize, the surpluses will exist only because government accounting obscures the growing cost of future liabilities. The government faces a large, long-term deficit, and tax cuts would make this problem worse. The proposed 10-percent income tax rate cut would provide disproportionately large benefits to wealthy households and little to lower income households. It would have little effect on economic growth, but would impose higher burdens on future generations, and would reduce future budget discipline by violating the budget rules. Moreover, for most families, tax burdens are already at their lowest level in twenty years. Saving the surplus, by paying down public debt, would help the economy much more than would tax cuts.
Topic:
Government and Political Economy
Political Geography:
United States

53904. The Changing Shape of Government

Author:
Paul C. Light
Publication Date:
02-1999
Content Type:
Policy Brief
Institution:
The Brookings Institution
Abstract:
The past six years have witnessed the most significant reshaping of the federal workforce in recent history. On the one hand, government clearly has lost weight. The total number of full-time federal employees has declined, as has the number of federal middle-level managers. On the other hand, government has gotten much taller, at least as measured by the number of layers at the very top of the federal hierarchy. This changing shape means that ordinary Americans will be less likely to contact a federal employee when they call a government 800 number, write an office, or use a service. It also means that the nation's elected and appointed leaders will be further from the front lines, and less likely to know what the public is getting for its tax dollars.
Topic:
Government
Political Geography:
United States

53905. Drug Trafficking on the Great Silk Road: The Security Environment in Central Asia

Author:
Martha Brill Olcott
Publication Date:
12-1999
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
To address drug proliferation and trafficking in the context of non-traditional security threats and to try to find ways out of the potentially explosive situation, the Carnegie Endowment for International Peace sponsored a meeting of representatives of the five Central Asian states, Russia, Azerbaijan, Turkey, the United States, the United Nations Drug Control Program (UNDCP), the Organization for Security and Cooperation in Europe (OSCE), and the Aga Khan Development Network, held in Bishkek, Kyrgyzstan in May 1999. This paper analyzes the situation in the region based on the conference proceedings and aims to raise international awareness of the seriousness of the problem. It also advocates the need for a concerted effort within the region and without to help these countries fight this evil.
Topic:
Security and International Law
Political Geography:
Russia, United States, Turkey, Asia, and United Nations

53906. A Dollarization Blueprint for Argentina

Author:
Steve H. Hanke and Kurt Schuler
Publication Date:
03-1999
Content Type:
Policy Brief
Institution:
The Cato Institute
Abstract:
President Carlos Menem of Argentina has advocated replacing the Argentine peso with the dollar. Dollarization would benefit Argentina because it would eliminate the peso-dollar exchange-rate risk, lower interest rates, and stimulate economic growth.
Topic:
Economics and International Political Economy
Political Geography:
Argentina, South America, and Latin America

53907. Ballistic Missile Proliferation: Does the Clinton Administration Understand the Threat?

Author:
Ivan Eland and Timothy M. Beard
Publication Date:
02-1999
Content Type:
Policy Brief
Institution:
The Cato Institute
Abstract:
Although the end of the Cold War reduced the likelihood of a nuclear exchange between the superpowers, several smaller rogue states, through their dedicated efforts to acquire weapons of mass destruction and ballistic missiles, have emerged as potential threats to U.S. national security. National Intelligence Estimate 95-19 stated that no new missile threats to the United States would develop before 2010. However, given the curious circumstances of the estimate's release and the many analytical faults contained in the document, its results have been questioned.
Topic:
Defense Policy and National Security
Political Geography:
United States

53908. Strengthening the Biological Weapons Convention: Illusory Benefits and Nasty Side Effects

Author:
Eric R. Taylor
Publication Date:
10-1999
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
The Biological Toxins and Weapons Convention—signed in 1972—prohibits signatory nations from developing, possessing, employing, or transferring biological weapons. The convention does not contain any protocols for its enforcement, however. There is now an international effort under way to develop such protocols.
Topic:
Arms Control and Proliferation and International Cooperation
Political Geography:
United States

53909. Corporate Welfare for Weapons Makers the Hidden Costs of Spending on Defense and Foreign Aid

Author:
William D. Hartung
Publication Date:
08-1999
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
The defense and foreign aid budgets are the largest single source of government funding for private corporations. More than half of U.S. weapons sales are now being financed by taxpayers instead of foreign arms purchasers. During fiscal year 1996 (the last year for which full statistics are available), the government spent more than $7.9 billion to help U.S. companies secure just over $12 billion in agreements for new international arms sales. The annual $7.9 billion in subsidies includes taxpayer-backed loans, grants, and government promotional activities that help U.S. weapons makers sell their products to foreign customers. Also, the provision of low-cost facilities and extensive subsidies for research and development and mergers and acquisitions to major contractors fosters a “risk-free” environment in which weapons makers have little economic incentive to produce effective systems at affordable prices. Furthermore, a portion of the $120 billion the Pentagon spends each year on contracts with U.S. defense contractors is being wasted on defense pork—that is, redundant or unneeded weapons systems. Such subsidies and spending for defense pork can interfere with the fulfillment of legitimate security needs.
Topic:
Defense Policy, Arms Control and Proliferation, Climate Change, Government, and Industrial Policy
Political Geography:
United States

53910. Replacing Potemkin Capitalism: Russia's Need for a Free-Market Financial System

Author:
Kurt Schuler and George A. Selgin
Publication Date:
06-1999
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
On August 17, 1998, Russia devalued the ruble and stopped payment on its government debt, creating a financial crisis that continues today. Some observers have blamed the financial crisis, and the poor performance of the Russian economy generally, on government policies that they claim are rigidly laissez faire. However, a closer look at the Russian financial system reveals that it remains fundamentally socialist, though it has superficial capitalist features.
Topic:
Debt, Economics, Government, and Financial Crisis
Political Geography:
Russia, Europe, and Asia