James Raymond Vreeland (Georgetown University)

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The Political Economy of the United Nations
Security CouncilMoney Influence

• James Raymond Vreeland (Georgetown University)
• Co-author Axel Dreher (University of Heidelberg)
• Mortara Center for International Studies
• Book Talk
• October 2, 2014

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Collaboration
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Cooperation Change
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The UN Security Council
IMF/WB project in Ghana
IMF
World Bank
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The question

• Do temporary members of the UNSC receive
  financial perks?

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Yes.

• Why?
• The United States and other powerful countries
  seek additional influence over the UNSC.

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Plan

• Overview of the book project
• What is the UN Security Council?
• Why seek influence over the UNSC?
• Evidence
• Anecdotes
• Large-n

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The Political Economy of the United Nations
Security CouncilMoney and Influence

• Ch1 Money and Politics on the International
  Stage
• Ch2 A Theory of Trading UNSC Votes for Aid
• Ch3 Examples of Punishments, Threats, and
  Rewards
• Ch4 Who Wins Election to Represent the World?
• Ch5 Statistical Evidence
• Ch6 Consequences
• Ch7 Reform?

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What is the UNSC(United Nations Security
Council)?
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What is the UNSC?

• 5 permanent members with veto power
• 10 elected members (2 year term - limited)
• Nominated by REGIONAL caucus, elected by GENERAL
  ASSEMBLY
• Resolutions (open ballot) require 9 votes
• UNSC votes on
• UN military action against aggressors
• Economic sanctions arms embargoes

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Why bribe/reward votes?

• Elected members of the UNSC potentially will vote
  on matters of extreme international importance
• Voting power?
• Legitimacy
• There is a premium for getting (near) unanimous
  votes to win domestic public support (Prof.
  Voeten)
• Symbolic
• Informational

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Conservative UNSC member
Typical US voter
US President
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US President public support before and after
military action with and without UNSC
authorization
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• The goal of the donor countries
• Get countries under a program in case important
  issues come up.
• Godfather-esque
• Some day, and that day may never come, I'll call
  upon you to do a service for me. But uh, until
  that day, accept this justice as a gift on my
  daughters wedding day.
• http//www.youtube.com/watch?v8Bz9iXernY4feature
  fvw

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Evidence

• Some anecdotes
• Systematic evidence

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Gulf War Examples

• Zimbabwe UNSC member 1991-92
• 1992 1st IMF arrangement in a decade
• Votes for 2 resolutions against Iraq
• Then abstains
• And Zimbabwe was threatened with new IMF
  conditions
• Subsequently votes for 11 resolutions condemning
  Iraq.

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Gulf War Examples

• Zaire in early 1991 PRESIDENT of UNSC
• Request emergency UNSC meeting
• Inconvenient for
• Zaire was offered undisclosed debt forgiveness
  and military equipment in return for silencing
  the Security Council when the attack was under
  way.

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Obama Ondimba

• Spring 2011 President Obama senior State
  Department officials meet with President Ondimba
  of Gabon
• Why would the United States grant Gabon (pop. 1.5
  mil) a high-level meeting?
• Gabon supported
• Res. 1970 (26 February 2011) Imposed sanctions
  on Gaddafis regime
• Res. 1973 (17 March 2011) Established a no-fly
  zone over Libya provided the legal basis for
  the military intervention in the Libyan Civil
  War.
• Res. 1973 was crucial passed with only ten
  votes
• http//www.npr.org/2011/06/14/137171315/for-u-s-de
  aling-with-dictators-is-not-unusual

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Sec. Clinton

• Togo elected to the UNSC fall 2011 to serve
  2012-13
• Sec. Clinton visits Togo
• Why?
• No Secretary of State had ever been to Togo
  before.
• Togo happens to be on the UN Security Council.
• Going there, making the personal investment, has
  a real strategic purpose.
• When... you look at the voting dynamics in key
  international institutions, you start to
  understand the value of paying attention to these
  places. Sec. Clinton

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Counter examples?
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Gulf War Examples

• Cuba UNSC member 1990-1
• Consistently opposed Iraq resolutions
• IMF arrangement?
• Left the IMF in 1964 not an IMF member
• (Why? Claimed the IMF was a tool of the US)

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Gulf War Examples

• Yemen UNSC member 1990-1
• Voted against Desert Storm
• U.S. representative was overheard declaring to
  the Yemeni ambassador that it was
• the most expensive vote you have ever cast.
• The US cut hundreds of millions of dollars in aid
• (No IMF arrangement)

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A more historical example?

• Tanzania
• 1961-1974 no IMF, no UNSC
• 1975
• UNSC member
• First IMF arrangement exceedingly weak
  conditionality

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IMF reply in the Washington Post (November 1,
2006)

• An IMF spokesman said the Tanzania evidence is
  anecdotal and circumstantial.
• To convince people, we need
• many more anecdotes
• statistical evidence (its not just luck)

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Descriptive data
(non-UNSC n5719) (UNSC n339)
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Enter the IMF the World Bank
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Key points about the IMF World Bank

• Involved with developing countries through
  programs loansconditions.
• Influence over decisions pegged to economic size.
• Growing evidence that the major shareholders use
  their influence for political reasons (e.g.
  Stone, Reynaud, Momani, Kilby).
• Especially when they agree (Copelovitch).

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Why use IFIs to influence the UNSC?

• Political benefits (for both actors)
• DIRTY WORK (Vaubel)
• Leverage benefits
• Conditionality loan disbursements
• Cost benefits

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World Bank evidence

• It is true that during the Cold War years aid
  was politically motivated.
• Now however, aid is being delivered to countries
  most in need and to those who show they are
  determined to use it well.
• (World Bank, FAQ, www.worldbank.org)

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Average of World Bank projects by UNSC
membership
If politics mattered during the Cold War, but not
after, this bar should be above the line, and
this one should be at/below the line
UNSC members continue to get more World Bank
programs
2.5
2.0
1.5
1.0
0.5
0.0
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Is this a US-thing?

• Regional Organizations
• Regional Hegemons

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Asian Development Bank
Daniel Yew Mao Lim, Class of 2011
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African Development Bank
  Pre-1982 1982 and onward
UNSC Member -0.104 1.717
UNSC Member (0.06) (3.55)
Pariah state 6.193 0.904
Pariah state (4.43) (0.48)
War 0.072 -1.519
War (0.04) (2.05)
ln(GDP per capita, PPP) 6.582 1.368
ln(GDP per capita, PPP) (2.14) (0.90)
Political regime -0.043 0.026
Political regime (0.29) (0.44)
Number of observations 355 1,338
R-squared 0.39 0.07
Notes All regressions include country and year fixed-effects and regional quartics (for North Africa and Africa South of the Sahara). Numbers in parentheses are the absolute values of t-statistics. Notes All regressions include country and year fixed-effects and regional quartics (for North Africa and Africa South of the Sahara). Numbers in parentheses are the absolute values of t-statistics. Notes All regressions include country and year fixed-effects and regional quartics (for North Africa and Africa South of the Sahara). Numbers in parentheses are the absolute values of t-statistics.
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Summary Observation by Russian Student

• Bribes no surprise
• Trade money for votes
• But the US allies bribe
• with a loan
• must be repaid!
• Impressive!

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Who is surprised?
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So what?

• Reform debate focuses on
• NUMBER of representatives
• elected
• permanent
• No discussion of accountability

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Accountability, the UNSC, the Paradox of
Stability
Criteria are too high!
Criteria are too low!
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Suggested reforms

• Do away with term limits
• Let regions elect

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DISCUSSION
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DISCUSSION Will China play the foreign aid game?

• How China might use its powerful position in
  international politics to try to obtain its
  foreign policy goals?
• Dalai Lama?
• Caribbean recognition of PRC vs. ROC?
• Chiang Mai alternative conditionality?

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Thank youWE ARE GLOBAL GEORGETOWN!
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Gulf War Examples

• Ecuador UNSC member 1991-92
• IMF arrangement in 1991
• Of course Ecuador is a regular IMF customer
  1961, 1962, 1963, 1964, 1965, 1966, 1969, 1970,
  1972, 1983, 1985, 1986, 1988, 1991, 1994, 2000
• Voted for all but 2 Iraq resolutions
• Note Ecuadors IMF participation pattern above
• Countries participate in IMF programs about 25
  of the time (including ALL countries).
• Typical pattern 5 years in, 5 years out, 5 years
  in, etc

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Member
Request aid
No request
Donor
Offer aid, set agt0
No offer
Nature reveals local politics b
Member
Member
Vote against
Vote with
Defect
Comply
Member b Donor 0
Member 0 Donor v
Donor
Donor
Disburse
Cut
Disburse
Cut
Member a Donor va
Member 0 Donor v-r
Member b Donor 0
Member ba Donor a
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Is this a US-thing?

• Regional Organizations
• Regional Hegemons

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Implications for governance reform of the IMF

• Q 1 Is this a bad thing?
• Q 2 Is it in the US interest to change things?
• Perhaps not Short-run political gains.
• Long-run economic development?

• Elected to the UNSC 6 times
• 15 IMF arrangements since 1958
• 32 out of 48 years (66 of the time)

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In the meantime

• The actual governance reform of the IMF
• Increase the voting power of
• China, South Korea, Brazil, Mexico and Turkey
• How will this address the political manipulation
  of the IMF?
• It wont.
• It is the correct thing to do, but probably
  wont make much difference.
• personal conversation with Pres. Henrique
  Cardoso, Brazil Pres. Ernesto Zedillo, Mexico