Greece's debt/financial problem and the future of the EU.

(I don't understand this topic completely and I am only presenting my Observations: I don't claim to be an expert on this subject.) I am putting Greece's debt problem into the context of the fact that many of the major economies of the world are headed, unless major changes are made, towards the very same debt crisis, America included, and I am not going to fully develop this topic presented in the first paragraph. To do so I would have to talk about the Federal Reserve, good video, and more. The world economic structure is being built on a foundation of debt. This is only postponing the eventual collapse of the existing world-economic system and the tough decisions that have to be made: a depression or more government involvement. From what I read, the existing economic structure is headed for a collapse. The results of this can be a new economic system that is based on free markets or the existing economic structure of state-control/socialism that is based off of debt will be strengthened and continue to grow up until and after the credit instruments, money, run dry. Economies run on money, and money makes voluntary financial activity possible. The other option that can replace money for a short period of time when these credits instruments run dry is government command. If these credit instruments run dry, what will make the economy function? Will the governments stand by and allow the economy to grind to a halt? No, so the government will step in and command that economic activity continue until it can solve the problem. Once it steps in it will not leave. Economic crises, the ones I know about, tend to strengthen the level of government involvement in the economy; and by looking at history and the current state of the world's cultures, I believe the last choice is what things seem to be leading up to. Through this prism, this situation indicates to me what these international organizations and future world government will be leading to: a world economy based on a command system as opposed to a free market system. This is not an argument against IO's or a more interconnected world, only a question of where this is headed.

Greece is going through a debt crises. They have minor civil unrest. I don't know if there is a potential for this to grow or it is just government-dependent people responding to the austerity program of the government. The choice is for Greece to cut spending or have the EU or IMF bail them out. It is not constitutional for the stronger EU nations to bail them out so this would require a reworking of the EU framework to meet this challenge or for Greece to be bailed out,

Yet, at the same time, the lack of a crisis management plan has left the major European economies fumbling for a way to stop the investor panic in Greece and ease the pressure on the euro without violating E.U. laws. 'What will have to come out of this is a combination of stronger integration and rules for crisis management, which were completely missing in the euro zone and which we're now inventing on the spot,' said Jean Pisani-Ferry, director of the Brussels-based think tank Bruegel

To deal with this financial situation it is necessary that the EU's powers are strengthened.

The options:

The move to back Greece, European officials say, appears likely to involve direct loans or loan guarantees from Germany and France, and perhaps some of the other financially sound members of the 16-nation euro zone. Another option is to have a consortium of banks, backed by Berlin and Paris, offer to buy Greek debt. European finance ministers, set to meet next week, are expected to fine-tune the strategy, officials said. Many think a deal would need to be hashed out soon to boost confidence in Greece before this spring, when the nation must sell $25 billion in debt or risk default.

The International Monetary Fund will be asked to offer advice to Greece as part of the agreement, though it would not provide financial assistance -- something Greece's larger euro zone partners view as too embarrassing for the European Union. The IMF said Thursday that it welcomed Europe's move, calling it an 'important new step.' Not everyone agreed. 'What they've basically done is say they will help Greece if it meets the terms of the plan to cut its deficit, but if it managed to do that, Greece wouldn't need any help,' said Simon Tilford, chief economist at the Center for European Reform. 'I certainly think they will come up with something more substantial. But today demonstrates that we may need a full-blown crisis in Greece before they are prepared to put money on the table.'

The buying of the Greek debt by Germany, who is slipping back into recession, and France would weaken the economic structure of the EU, see below. Thing generally have to come to a crises before people decide to deal with the fundamental problems. This indicates when the turning point is for such crises are and provides some insight into when America will deal with its debt/fundamental economic problems and make the hard decisions, hopefully the American people won't be so dependent on the government that they will protest like the Greeks; but will instead have the fortitude and knowledge to make tough decisions, yeah right.

Nothing substantial will happen until the end of March, "The European strategy that emerged tonight was one of wait, see and hope. The Greek government does not need to raise any money until the end of March at the earliest."

Germany and France can not constitutionally come to the aid of Greece under the Maastricht Treaty or the Eu constitution. This would require a reworking of the EU framework as mentioned above. I don't know the potential for any major civil unrest in Greece or what effect a default will have to the Euro. As of now the large EU nations Germany and France are trying to get Greece to get their own house in order and make tough budget decisions. The options are that Greece can make spending cuts and possibly face civil unrest, I don't know if this is a major concern or a major threat. I don't know if it Greece will have the incentive to go against its public opinion to cut its spending. If Greece does not get it finance in order, will the larger EU nations run the risk of having the Euro be devalued if they bail out Greece.

A former chief economist at the International Monetary Fund, said at a forum in Tokyo yesterday that "he expects Greece will eventually be bailed out by the IMF rather than the European Union". It appears to me that this would be better than being bailed out by the EU, but what about the other EU nations that have debt problems?

It now looks like Greece is calling Germany names possibly lowering the chances of a bailout for Greece. Also in the article is more about the riots and the potential for civil unrest being a factor in making a bailout more likely,

Public and private sector unions joined forces to bring the country to a standstill for 24 hours, halting flights, trains, and shipping, and shutting schools and hospitals.[...]
Investors fear austerity protests could spread in Europe. Portuguese unions have called a general strike for early March. Spanish unions held marches in Madrid and Barcelona on Tuesday over pensions, but turnout was low. The EU has always found ways to master crises over the last 60 years, and will most likely do so again, but this one feels different to EU veterans. Germany's top court has left doubts about the legality of any bail-out. There is deep resistance in both Germany and Holland to calls for an EU fiscal authority or debt union – a quantum leap in EU integration.[emphases mine] Such a move would imply an open-ended guarantee for over €3trillion in Club Med debt, and a violation of the political contract behind EMU. Bavarian leader Edmund Stoiber once famously derided warnings that the euro would leave German taxpayers on the hook for foreigners as no more likely than "a famine in Bavaria". Pledges come back to haunt.

The civil unrest does not appear to be anything major.

A bailout of Greece could led to a collapse of the Euro?,

The European single currency is facing an 'inevitable break-up' a leading French bank claimed yesterday. Strategists at Paris-based Société Générale said that any bailout of the stricken Greek economy would only provide 'sticking plasters' to cover the deep- seated flaws in the eurozone bloc.[...] He added: 'Any "help" given to Greece merely delays the inevitable break-up of the eurozone.'[...] He [David Cameron] said: 'The eurozone is facing a fully-fledged crisis. The Greece episode has made it painfully clear how flawed the euro project was from the very beginning.[...] The French bank's warning was echoed by Mats Persson, Director of the Open Europe think-tank, which campaigns for reforms in Brussels. 'Even if Greece receives a one-off bailout it would not solve the real problem, which is the huge differences in competitiveness between the eurozone's richest and poorest members. If these differences are to be evened out, the EU would need a single budget and common taxes so it can redistribute resources. 'One thing is clear, Britain made the right choice in staying out.'

And George Soros is stating the same flaw and same solution to the structure of the EU,

Mr Soros, who made more than $1billion by currency speculation when the pound was ejected from the Exchange Rate Mechanism on Black Wednesday in 1992, believes the structure of the euro is 'patently flawed'. He said: 'Makeshift assistance should be enough for Greece, but that leaves Spain, Italy, Portugal and Ireland. 'Together they constitute too large a portion of euroland to be helped in this way.'He believes that unless the European Commission is given sweeping powers over taxation and spending, the single currency will always be vulnerable to financial turbulence in individual states. 'If member countries cannot take the next steps forward, the euro may fall apart,' he added.

If seems that there are some inherent flaws in the structure of the EU that would require new 'sweeping powers' in order for it to continue to be a viable international organization. If this problem is true, will the euro fall apart or will the EU grow its powers?

Could this financial crises actually led to a stronger EU as indicated by Soros and the assessment by the think tank that there is fundamental problem of the differences between the richest and poorest countries of the EU that undermine the structure of the EU, and as indicated by the solution to this problem which is the single budget and common taxes so it can redistribute resources? If Greece is bailed out, by the EU or the IMF, this would be postponing the day of reckoning and would be tying the weak or troubled economies to the stronger ones within the EU. The only good option is for the large EU countries to exert pressure on Greece and force Greece to solve their own budget problems. If Greece doesn't get its own economy back on track, then the options are for the EU to bail them out, lower or reduce the budget and economic requirements necessary for EU membership, or for Greece to leave the EU. These options will all lead to a weaker economic foundation for the EU, but at the same time it would led to an EU with more power and authority. If Greece is bailed out or the budget and economic requirements for EU membership are reduced, then this will reduce the incentive for the other EU nations to not run up larger deficits. This would hurt the stronger EU nations and the overall economic structure of the EU, and in order for the larger EU nations to protect themselves they would have to be given greater authority to intervene in the small EU nations. IF the last two options occur, It appears to me that this situation will led to an EU with greater authority, but one with a weaker economic structure. This weak economic structure could led to another financial crisis that would further strengthen the EU. (This is my take.) Greece's debt problem is not the only EU nation with economic problems: Spain, Ireland, and Portugal all have debt problems and Germany is slipping back into recession. I think this situation shows that IO's will continue to grow in power due to the economic structure of the world's economy, and this would be necessary in order for these IOs to be a viable organization and to perform its intended functions. How this plays out/how the EU reacts to this will be an important indicator of how such national debt problems can or will play out in the future, and this could potentially led to a stronger European Union. Or Greece will get its own economy in order and nothing major will come out of these developments. Overall, it will be interesting to see how this plays out.

Is This Our Guy? Paul Ryan Takes Dear Leader to the Woodshed

Many pundits councelled against Republicans taking Obama up on meeting him at the Health Care Summit today.  But, it seems to be universally agreed that the Republicans more than held their own at the meeting and gave Obama a bloody nose.

All the blogs are linking to Paul Ryan (Representative from Wisconsin) giving Dear Leader a little lecture on ObamaCare-onomics.  Enjoy the pained look on Obama's face and Joe Biden burying his head in his hands at the link as someone who actually has a clue tells them what their plan is about.

A telegenic guy (that's a non-gay way of calling him handsome) speaking truth to power with lots of facts.  I like it.  I wish those words could come out of Sarah's mouth, but, so be it.

Something to cheer for

America beats the hippies 5-3. Its awesome. A bunch of Canucks are calling Jim Rome's radio show saying that America sucks and we only won because we have Ryan Miller as a goalie. The Canadians out shot us 2-1(43 shots on goal to our 23 I think) but our awesome goal tender (some say the best in the world) was a freakin wall.

Jim Rome defended us well. He said, "I guess the Saints wouldnt have won without Drew Brees. I guess the Bulls wouldnt have won without Jordan. I guess the niners wouldnt have won without Montana. I guess America wouldnt have won without sticks." He then said, "Yeah, you guys had Sidney Crosby and you still lost."

America did get maximum output from a team that isnt supposed to be that great. We played our best and this might just light a fire under the Canadians ass. The Canadian team is supposed to have the best team in the World this year. We cant get complaceant.

I think South Park's greatest quote from the movie summarizes it best..."Fuck Canada!"

Taliban Arrests in Pakistan a Bad Thing?

InstaBud-D here again.  The London Times has an interesting take on the spectacular arrests in Pakistan last week.  The gist of their point is that Pakistan is arresting Taliban leaders that were trying to work a deal with the Karzai government, and that Pakistan is arresting them because they don't want the conflict, and more importantly, the billions of dollars in US aid to fight it, to stop.

I have no idea if the leaders being arrested are the more moderate ones or not, but it is odd that Pakistan can roll up all these guys at this time.

Bud-D's Band?

Hilarious.

Another Good, Insightful Article on the Causes of the Recession

InstaBud-D again with another quick link: The Cato Institute (which I think is a Libertarian organization) has a very good article calling out the pieces that altogether contributed to what they call the Great Recession.  In listing all the different contributors, they point out that the great problem is that incredible weight of state, local, federal, and international regulations that made it impossible for anyone - not the bankers, nor Fannie or Freddie, nor the SEC, nor any of the lawmakers themselves - to be able to understand the full consequences of the decisions they were making:

Those who play the blame game can find plenty of targets here: the bankers and the regulators were equally clueless. But should anyone be blamed for not recognizing the implications of regulations that they don't even know exist?

Omniscience cannot be expected of human beings. One really would have had to be a god to master the millions of pages in the Federal Register — not to mention the pages of the Register's state, local, and now international counterparts — so one could pick out the specific group of regulations, issued in different fields over the course of decades, that would end up conspiring to create the greatest banking crisis since the Great Depression. This storm may have been perfect, therefore, but it may not prove to be rare. New regulations are bound to interact unexpectedly with old ones if the regulators, being human, are ignorant of the old ones and of their effects.

They go on to say:

The financial crisis was a convulsion in the corpulent body of social democracy. "Social democracy" is the modern mandate that government solve social problems as they arise. Its body is the mass of laws that grow up over time — seemingly in inverse proportion to the ability of its brain to comprehend the causes of the underlying problems.

These are the general points. They go into good detail to justify these points. Basically, The People complain about risk to their standard of living or wealth, as they first did after the '29 Stock Market Crash. The government steps in to build cushions of safety, so if a disaster like the previous one happens, people won't be completely wiped out. But, rather than behave conservatively within this new safety cushion, people (individuals, banks, whoever) think "I can make more money if I push to the limits of this cushion", and then set themselves up for new disasters. I think this ties in neatly with the problems in Greece and California.

Reports of America's Demise Premature?

As RTP&GG readers know, one of my mantras is 'Demography is Destiny'.  A website I like is New Geography because one aspect of geography is demographic analysis.  Anyway, they have a neat article in the manner of 'America's future is dark, except when compared to all its rivals' that shows that we aren't quite the nation of eunuchs that most of our chief rivals, uhum China, uhum Russia, uhum Eurowusses, uhum Japan are.

A Glimpse of a Different Future?

I'm going play Instapundit and do a couple of 'Hey, look at this' posts with little of my insightful analysis to accompany it.  Anyway, Colorado Springs has just done the sensible thing:

Tired of indiscriminate spending, questionable officials and unnecessary expenditures, the residents of one Colorado city have decided to end the era of big government in their municipality, even if it means mowing the grass at the local park themselves...

This may mean they need to patrol the streets themselves, dunno. I bet streets patrolled by the people who lived on them would be safer than streets patrolled by cops.  I wish them success.

Economic news. For those that are still working in the private sector.

(I decided not to do a bunch of small posts. Neil Barofsky and the retirement account links below are most interesting.)
Japan's triple-A rating foreign credit rating has been downgraded. While this is not a major event, the article above states that this action by Moody's investor service could cause people to question the creditworthiness of other nations.

The value of outstanding Japanese government debt is more than 170 percent of gross domestic product, making it the most indebted government in the Organization for Economic Co-operation and Development, a club of industrialized nations. The debt burden is a legacy of massive government spending to cushion the economy during a decade of deflation that began in the 1990s.[...]Still, Moody's cited the level of debt, the expansion of government spending and the crumbling economy as reasons for its new rating.'Given the size of Japan's overall public deficit it obviously should not enjoy the highest rating. Japan has fiscal obligations which will span generations but it is certainly not a dire outlook,' Glenn Maguire, economist at Societe Generale in Hong Kong.

An opinion piece by Barron's examines sovereign debt: "On the latter, Standard & Poor's lowered its outlook for Japan's sovereign debt rating to 'negative'. 'While Japan's long-term debt rating remains double-A, the outlook for that high rating no longer is 'stable.'" Concerning America's debt the article points out the statement by the CBO,

Similarly, Doug Elmendorf, the director of the Congressional Budget Office, called the outlook for the federal budget 'bleak.' The CBO projects the current year's deficit of $1.35 trillion to equal 9.2% of GDP. CBO forecast total publicly held debt to rise to 60% of GDP this year and 67% by 202o. In 2001, publicly held debt equaled just 33% of GDP. While Japan has a much higher debt-to-GDP ratio, its government debt is almost entirely held domestically. Japanese savings readily finance the deficit at ultra-low rates, around 1.33% for 10-year government bonds. But its rapidly aging population will begin drawing down those savings, leaving less to fund the budget deficit. By contrast, the lion's share of U.S. debt is held by foreigners,[I always thought that Americans owned most of this debt?] making a rising debt-to-GDP ratio even more politically sensitive.

There have been no new private sector jobs created over the pass eleven years. At the same time government jobs have grown.

The Bush tax cuts are about to expire. This means that taxes will go up for higher income workers and capital gains taxes will go up. Here is a good opinion and overview on all of the tax increases. We all know the damping effect that tax increases will have on the economy.

The Heritage Foundation did a good overview on President Obama's budget and the CBO's ten-year budget baseline.

It looks like a bigger financial crises is looming. This according to the special inspector general for the TARP,

The problems that led to the last financial crisis have not yet been addressed, and in some cases have grown worse, says Neil Barofsky A, the special inspector general for the trouble asset relief program, or TRP. The quarterly report to Congress was released Sunday. The government's bailout of financial institutions deemed 'too big to fail' has created a risk that the United States could face a worse fiscal meltdown in the future, an independent watchdog assigned to review the program told Congress on Sunday.[...]'Even if TARP saved our financial system from driving off a cliff back in 2008, absent meaningful reform, we are still driving on the same winding mountain road, but this time in a faster car,' Barofsky wrote.

Many of the underlying causes of the financial meltdown have not been addressed and instead many of the causes have been expanded and carried out on a larger scale such as in the housing market.

'Even if TARP saved our financial system from driving off a cliff back in 2008, absent meaningful reform, we are still driving on the same winding mountain road, but this time in a faster car,' Barofsky wrote.[...] Much of Barofsky's report focused on the government's growing role in the housing market, which he said has increased the risk of another housing bubble. Over the past year, the federal government has spent hundreds of billions propping up the housing market. About 90 percent of home loans are backed by government controlled entities, mainly Fannie Mae, Freddie Mac and the Federal Housing Administration. The Federal Reserve is spending $1.25 trillion to hold down mortgage rates, and millions of homeowners have refinanced at lower rates. 'The government has stepped in where the private players have gone away,' Barofsky said in an interview. 'If we take government resources and replace that market without addressing the serious (underlying) concerns, there really is a risk of" artificially pushing up home prices in the coming years. The report warned that these supports mean the government 'has done more than simply support the mortgage market, in many ways it has become the mortgage market, with the taxpayer shouldering the risk that had once been borne by the private investor.'

When people are not able to pay their mortgages due to a downturn in the economy(see Barofsky's take above), it won't be the banks failing, it will the the U.S. taxpayers as a whole--the Country.

About 38 million people are on food stamps.

This is major. According to Boortz, Uncle Sam wants your retirement. The government is running major deficits and is in need of money. Foreign nations have already expressed that they are unwillingly or unable to continue to finance Washington's spending. So they are coming after you. There are more than 3 trillion dollars out there in individual retirement accounts. There was already an economic professor advocating before some congressional committee the government take-over of retirement accounts at the beginning of the recession, she was given full attention. Social Security is going bankrupt, according to my SS statement. This is a portent of what will happen to your retirement savings that the governments wants. The government takes 14% of your money each pay check to fund SS. It has wasted that money. Now it wants your savings. This might be on the peripheral now and just talk, but it is a step towards the government taking over retirement accounts. I have about 35 years until I retire. Since 09, I have stopped contributing to my IRA.

It looks to me like the Obama administration is starting to eye your retirement. As of right now, it might look relatively harmless . but the Obama et al are 'weighing how the government can encourage workers to turn their savings into guaranteed income streams.' Call me paranoid, but this looks to me like just the opening shot of what will become an attempt by the government to seize your retirement funds[...]You may think that I am blowing smoke, but the chairman of the House Committee on Education and Labor Rep. George Miller has said that 'sweeping changes are coming to the 401(k) system'. Part of a plan presented to his committee by a woman by the name of Teresa Ghilarducci included confiscating workers’ personal retirement accounts and converting them into accounts managed by the Social Security Administration.

There are debt crises in the European Union nation's of Greece, Spain, and Portugal. And according to the article, this could be portent what will happen in America,

'The problems currently faced by peripheral Europe could be a dress rehearsal for what the U.S. and U.K. may face further down the road,' Jim Reid, a strategist at Deutsche Bank in London, wrote in a research note today.[...] The U.K.’s budget deficit hit 15.7 billion pounds ($25.3 billion) two months ago, the most for any December since records began, the Office for National Statistics said Jan. 21. Moody’s Investors Service said in December its top debt ratings on the U.S. and the U.K. may 'test the Aaa boundaries.'

The EU could just bail these countries out as a last resort. But who will bail the EU out when it goes bankrupt?

This is all little bits of economic news I have read and found interesting in that it indicates that the major causes of this recession have not been addressed but have instead been expanded. Another downturn looks like a very real possibility in the future. The forecast for the economy does not look good, a sentiment echoed by my economics class. These four years will stand along side the Great Depression as a major shift in the role of government and the public's opinion of what role the government should have in the economy here in America. The fact is that the economy is on the decline and will be slow for years to come. This information is good for those that plan on working in the private sector someday; and in general for planning out your future. It will be interesting to see how all of this will play out.

Возврат в СССР? (Return of the USSR?)

Dark days for the rebellion.

And it was even legit.....I wonder if Yanukovich's American political consultant was an Obama '08 lackey?

Just goes to show you my previous arguments for economics uber alles. The terrible economic morass that Ukraine is in was enough to keep the western minded Ukrainians from voting in large enough droves to offset this travesty. This will be compounded when Moscow relaxes it's stringent energy costs that has frequently been a point of contention between the two countries; a solution that Yanukovich has promised he will solve. For many, the choice whether to get affordable electricity in winter vs Western style competition was a major factor.

What does this mean? For starters, I could say it is a perfect example of the inability of "the march to democracy" to be an inevitable process ; but Putin himself proved that in 2000 (as well as Hitler in the 30's). The next democratic target for Russia will be Georgia. Obviously, Georgia will be a tougher nut to crack due to the massive displeasure over Russia, but it could still assist those politicians that want to take a less confrontational stance with Putin (Interesting article that discusses the displeasure of Yanukovich over Georgian observers and an opposition Georgian MP who sounds a little appeasing of Yanukovich's concerns and seems to imply some sort of willingness to warm up to Russian's Ukranian lackeys ). I think if we're going to exploit any of the gains since the end of the Cold War Obama needs to remain committed to propping up the Georgian government and to do everything to satisfy security concerns by those within Russia's "Near Abroad" (a concern especially felt by the Baltic States during the ABM fiasco). Romania's announcement to hold intercepters is a good start, but we still have a long way to go to undo the lost of confidence .

Special Forces

In the spirit of animals being awesome, I think we should give this hero a medal. Assaulting a highly defend able position (and as all of us Hearts of Iron players know, mountains are the worst) without weapons other than pure hatred for Islamic extremism, this patriot lives up to the highest standards of freedom.

The Beast Strikes Again

I don't know much at all about the whole Cthulu thing, but I know he's supposed to look like a giant octopus or something.  I think that's a bunch of bull.  This is the face of evil incarnate:

The Beast strikes again in his never-ending Quest to Destroy Mankind!

International Organizations II (too many characters for a comment post)

"I would need a heavy paper-trail of good intentions combined with good results to be convinced that an IO existed that would benefit me."

The World Trade Organization. Period. Ignore the UN, League of Nations, the Pact of Paris, all the rest of the ridiculous nonsense that you guys think are powerful IO's. The WTO single-handedly is the most invasive, sinister, powerful IO that has ever existed. At no other point in world history has an organization been able to coordinate/break down trade barriers between soverign states as the WTO. It (or the GATT in Cold War parlance) along with the World Bank and the IMF were specifically created to integrate the Western World (with additional third world missions to creep up later) and has categorically succeeded. (sinister, if you're a hippy, in that it we have built our own contradictions within the organization in that we are for the removal of all trade barriers in all industries EXCEPT the ones in which we need protection from cheap developing countries, namely agricultural subsidies. Because this is true for Europe see CAP, Japan, and US, we're able to totally dictate abusive trade relationships with the rest of the world.)

Once again, the EU is an excellant org (that we pushed France into creating, and England to joining despite a couple of veto's from de Gaulle). I would even argue that the EU is better for the United States, despite trade competition, than if it didn't exist (but that's a whole new debate)

Why are you guys so concerned with this ethical nonsense? The IO's that work aren't the IO's that have some giant do-gooder mission. That's my argument.

The UN is supposed to give a ridiculous amount of protections to humanity, but it doesn't do shit...Technically we're not even allowed to execute our prisoners, but will the UN ever "compel us" to stop capital punishment? Will they ever be able to tell us what to do or dictate the rules of the road for the future? Absolutel not. We even spent a decade drafting an international law of the sea compelling our allies to join and then at the last minute we reneged. That treaty theoretically exists right now (went into affect with the 160th country signed it) but we filipiantly ignore it at all times. The UN might be a "forum" for Russia and China to take pot shots at us, but it is certainly not a weapon. The UN had a meeting about Economics and grants to the third world? Great. It's cute. But it certainly isn't a threat, and it certainly won't be anything significant in the world.

Lets not forget that there are some organs of the UN that are effective (I cited the ITU in my original post), most notably the IAEA. Do you think American inspectors could unilaterally walk into Iran and get the kind of access the IAEA does? Such access comes about from "perceived legitimacy" that I also discuss (why it's important for IOs to be able to tell us "no")...there's also an excellant discussion to be had of the IAEA and "hand outs" to the poor states that has kept Nuclear proliferation to a minimum.

What I'm trying to say is that IOs are good because the only ones that have succeeded or will succeed will be in our net interest; those that pursue some utopian goals are exactly the ones that won't work. Even if they continue to exist they present no measurable threat to us. Even if they would've put something on paper in Coopenhagen, when countries actually went around trying to implement it, it would've failed miserably. We would've run into Coordination problems, will China actually allow inspectors to monitor their emissions? Should we give them handouts before they allow inspectors or after? Obviously after, but would China agree to this? Do we want to be stuck in a cycle of paying for inspectors? Etc etc. We would've run into committment problems, could political leaders suffer attacks from opposition parties for giving "handouts" for nebulous gains? Also there's the problem of it being too grand. The more states that you have in an organization, the more conflicting interests you have. Thus, whatever general agreement that comes about will be a watered down defunct POS (see the UN & Coopenhagen). The successful IOs have been those that are regional or homogenous in region or purpose, or, if they eventually take on a global scale, develop that way incrementally instead of all at once. That's a little off topic, but something to think about nonetheless.