Power plants are the single largest sources of carbon pollution in the United States. Credit: Bigstock

By Carey L. Biron
WASHINGTON , Jun 2 2014 (IPS)

U.S. power plants would be required to reduce their carbon-dioxide emissions by almost a third in coming decades, under a landmark proposal that constitutes President Barack Obama’s most significant attempt to counter climate change.

While the federal government has long regulated a spectrum of airborne pollutants from power plants, the rule marks the first time that carbon would be added to this list. That’s particularly important given carbon-dioxide’s outsized role in fuelling climate change, and the fact that the U.S. power sector is responsible for some 40 percent of the country’s greenhouse gas emissions.

Indeed, carbon alone accounts for more than four-fifths of U.S. greenhouse gas emissions, according to government estimates.

“In that we’ve never had carbon pollution standards, this proposal is revolutionary,” Nikki Silvestri, executive director of Green For All, an advocacy group, told IPS. “If we can really make this rule work, and if it is enforced well, it could have the potential to phase in a clean-energy economy – and that’s really what we’re going for.”

The new proposal, unveiled Monday and known as the Clean Power Plan, would seek to bring down carbon emissions from power plants by 30 percent (below 2005 levels) by 2030. According to the Environmental Protection Agency (EPA), which proposed the rule, that’s equivalent to half of the emissions produced from powering every home in the United States for a year.

The plan does not necessitate action from the U.S. Congress, which has refused to touch any climate-related legislation since early on in Obama’s tenure. The administration has already tightened emissions regulations for future power plants as well as automobiles and transport trucks, though Monday’s announcement has received by far the most intense anticipation from both environmentalists and industry.

The 645-page proposal is twofold, laying out broad carbon-reduction goals but also leaving it up to each state to figure out how to meet those goals. As such, states would have available a variety of options, including bolstering efficiency, investing in renewable energies, fashioning a tax on carbon, building up so-called carbon-trading schemes, or phasing out older or coal-fired power plants.

According to the U.S. Energy Information Administration, coal made up 39 percent of the U.S. energy mix last year, while hydropower and other renewables accounted for just 13 percent.

“The EPA’s proposal to limit carbon pollution from power plants for the first time ever is a giant leap forward in protecting the health of all Americans and future generations,” Frances Beinecke, president of the Natural Resources Defense Council, a prominent watchdog group, said Monday.

“It sets fair targets for each state and empowers the states with the flexibility to craft the best local solutions, using an array of compliance tools. And if states embrace the huge energy efficiency opportunities, consumers will save on their electric bills and see hundreds of thousands of jobs created across the country.”

Still, the new rule would not actually bring U.S. emissions below levels urged by the United Nations.

“The targets aren’t ambitious enough for real emissions reduction,” Janet Redman, director of the Climate Policy Program at the Institute for Policy Studies, a Washington think tank, told IPS. “But they are a piece of the puzzle, and it would be a real win if this rule restricts emissions from coal-fired power plants.”

Environmental justice

While the global ramifications of Monday’s announcement will become clearer in coming months, the Obama administration has thus far sought to highlight the proposed rule’s domestic impact, especially in terms of public health.

Achieving the carbon-reduction goal by 2030 would also cut smog-producing pollution by a quarter, the government says. And those benefits would likely be felt in particular by African-American, Hispanic and low-income communities.

“This is about environmental justice, too, because lower income families and communities of colour are hardest hit,” Gina McCarthy, the head of the EPA, said Monday in unveiling the rule’s details.

“Rising temperatures bring more smog, more asthma, and longer allergy seasons … The first year that these standards go into effect, we’ll avoid up to 100,000 asthma attacks and 2,100 heart attacks – and those numbers go up from there.”

McCarthy said that by reducing soot and smog, the administration’s plan will create climate and health-related benefits worth some 90 billion dollars in 2030, versus costs of around eight billion dollars a year. “For every dollar we invest in the plan, families will see seven dollars in health benefits,” she noted.

During a conference call hosted by public health groups on Monday, Obama noted that African-Americans are four times as likely as others to die of asthma, while Latinos are 30 percent more likely to be hospitalised for related problems. And according to Green For All’s Silvestri, some 68 percent of African-Americans live within 30 miles of a coal plant.

“Thus far, people really aren’t connecting these health issues to pollution and to climate change – they just know that each of their kids has asthma,” she says. “So we really need to connect these dots for people, to focus on these things that are already affecting our communities every day and then explain how climate change is contributing.”

Some worry that such an effort could be undercut if the new EPA rule pushes states towards carbon-trading schemes, under which emissions permits can be bought and sold. While such systems do allow policymakers to establish overall caps on emissions, critics say carbon trading can actually help dirty industries resist change.

“While the idea is that such a programme makes it more economical for polluters to clean up their act, those that are the hardest to clean up can simply pay to continue polluting,” the Institute for Policy Studies’ Redman says.

“That’s a major problem for those living next to power plants – people of colour, poor communities and others who are already feeling the effects of this pollution.”

Following four months of public comment and what will certainly be extensive legal challenges, the EPA is slated to finalise the new carbon-emissions rule by June 2015. Thereafter, states would have until mid-2016 to finalise their own plans on compliance, though that deadline could be extended by another two years if requested.

Advocates say that public opinion, both domestically and internationally, is already in the midst of broad changes regarding dirtier forms of energy production. Credit: Bigstock

By Carey L. Biron
WASHINGTON, Jan 14 2014 (IPS)

Environmentalists and some lawmakers are decrying a surprise move by conservative members of Congress to roll back landmark “clean energy” policies guiding U.S. investments in overseas power projects.

Two federal agencies have new guidance in place largely barring government investment in power-generation projects that fail to adequately cut carbon emissions. The rules, by the Export-Import Bank and the Overseas Private Investment Corporation (OPIC), which facilitate U.S. private investments into foreign projects, would essentially discontinue U.S. funding for overseas coal-fired power generation."Industry and the politicians that represent them are panicking." -- Janet Redman

Yet a surprise addendum to a massive U.S. government spending bill would disallow the Export-Import Bank from implementing its new rule, which was unveiled in December. The provision, made public Monday evening, also guts a court-ordered greenhouse gas cap put in place in 2009 to force OPIC to set limits on the carbon emissions of its investments.

“In our view, this is a direct attack on one of the key achievements of the president’s Climate Action Plan,” Justin Guay, a Washington representative for the Sierra Club, a conservation and advocacy group, told IPS.

“This was the coal industry striking back symbolically at what it saw as a very serious set of political headwinds, as the overseas markets represent their lone opportunity to remain a relevant industry.”

According to media reports, the new provision was offered by Hal Rogers, the top Republican lawmaker in charge of crafting the massive appropriations bill, which allocates funding for nearly all parts of the federal government. On Tuesday, Rogers touted the passage of “A provision to prohibit the Export-Import Bank and OPIC from blocking coal and other power-generation projects, which will increase exports of U.S. goods or services.”

Rogers is a representative from the state of Kentucky, where the coal industry has traditionally been particularly strong.

An OPIC spokesperson told IPS that, for fiscal year 2014, the new legislation “permits OPIC to consider power projects in poor countries that would otherwise be subject to its [greenhouse gas] portfolio reduction goals, while preserving other pre-existing environmental, labour, human rights and credit criteria.”

Ex-Im model

The second half of last year saw a flurry of high-level activity on environment issues here, following a major climate-related speech given by President Barack Obama. One element of this was the administration’s move to severely curtail U.S. funding streams, both public and private, for coal projects abroad.

Following on new regulatory proposals for future power plants here, the Export-Import Bank in December announced that it would only finance overseas power projects if they put in place “carbon capture and sequestration” technologies, to store emissions underground.

“The Export-Import Bank was the world’s first export credit agency to have announced restrictions of this type,” Guay says.

“They really went out on a limb to put these guidelines in place, but then also worked with governments around the world to replicate those policies. The subsequent successes we’ve seen are almost entirely due to the leadership and pressure from the Obama administration.”

Seven countries and four international financial institutions have now passed some form of the Export-Import Bank’s guidelines on energy-related funding. Guay says this is seen as an important success for the Obama administration – and an indication that the president is taking on stronger international leadership on the issue.

For now, however, this victory appears to have been snatched away. While U.S. legislative proposals are typically open to debate and changes, the new appropriations bill will likely not see such a process.

The bill not only covers a huge swath of issues, but is also seen as an important – and uncommon – result of negotiations between the two political parties. On Tuesday, the White House indicated that it supported passage of the bill in its current form.

Yet nearly all lawmakers over the past day have noted that there is much to dislike in the proposal, with some specifically highlighting the new OPIC and Export-Import provisions.

“There are also some things I wish were not in here, particularly a House provision that would weaken limits on carbon emissions from projects financed by the Export-Import Bank and Overseas Private Investment Corporation,” Senator Patrick Leahy said on the Senate floor on Tuesday. “We should be using public funds to support exports of clean, renewable technology, not to fund power projects that worsen global warming.”

Altruistic appearances

Still, advocates say that public opinion, both domestically and internationally, is already in the midst of broad changes regarding dirtier forms of energy production. This is particularly the case with coal, which many analysts see as a dying industry in the United States.

“In a sense, industry and the politicians that represent them are panicking,” Janet Redman, director of the Climate Policy Programme at the Institute for Policy Studies, a Washington think tank, told IPS. “Because of this, we’ve seen an overall attack on the ongoing shift away from fossil fuel. Part of this is industry players pushing new ideas like ‘clean coal’ or natural gas as a ‘bridge’ fuel.”

Redman draws a link between these new, ostensibly more progressive, campaigns and a tactic she says is part of the push against the OPIC and Export-Import guidelines.

“We’re seeing some folks say that the idea here is about development goals and reducing poverty,” Redman says. “But I’m concerned that fossil fuels interests are hiding behind what looks like an altruistic motive as a way to build up the industry.”

In mid-December, two Republican lawmakers, including another representative from Kentucky, decried the restrictive new U.S. policies on overseas energy investment.

“The actions raise questions … [about] the practical impact of U.S. international humanitarian goals, trade policies, and foreign commerce,” the lawmakers, Fred Upton and Ed Whitfield, stated in a letter to U.S. Treasury Secretary Jacob Lew.

“Requiring [carbon capture and sequestration] would constitute a de facto ban on construction of state-of-the-art new coal-fired power plants – projects that some of the countries in greatest need of reliable and affordable electricity seek today.”

Such warnings notwithstanding, the Sierra Club’s Guay says the new provisions appear to have caught by surprise many proponents of cleaner overseas energy investments.

“We weren’t expecting such a problematic set of language around these provisions – it seems to have been kind of snuck in during the dead of the night,” he says.

“The [Obama] administration is not going to be happy. But one silver lining could be that this attack will have woken up both the administration and the activist community to how important this [provision] was and how much defence it will require going forward.”

Queensland declared a natural disaster Jan. 12, 2011 in Brisbane, Australia. Credit: Bigstock

By Carey L. Biron
WASHINGTON, Sep 24 2013 (IPS)

More than a half-dozen governments on Tuesday launched a yearlong collaborative investigation into the economic benefits of taking broad action to combat global climate action.

The nine-million-dollar initiative, dubbed the New Climate Economy project, is being spearheaded by a commission chaired by former Mexican president Felipe Calderon and is backed by the governments of Colombia, Ethiopia, Indonesia, Korea, Norway, Sweden and the United Kingdom.

The research will be carried out by institutes located in most of these countries and will culminate in a report to be published in September 2014, just ahead of a major scheduled United Nations summit on climate.

In addition to an oversight panel made up of former heads of state and finance ministers, the Global Commission on the Economy and Climate is co-chaired by Nicholas Stern, the British economist who published a touchstone climate change review for the U.K. government in 2006. For this reason, the project is being seen as a direct follow-up to Stern’s previous work.

“At a time when governments throughout the world are struggling to boost growth, increase access to energy, and improve food security, it is essential that the full costs and benefits of climate policies are more clearly understood,” Stern said Tuesday, as the new project was launched on the sidelines of the U.N. General Assembly in New York.  “It cannot be a case of either achieving growth or tackling global warming. It must be both.”

Since the publication of his 2006 report, Stern has been credited with having had perhaps the most significant impact on the international public understanding of the economic threats posed by climate change. He will now formally review the New Climate Economy report.

“There is some sense that this new report will be Stern 2.0, but in fact the focus looks set to be somewhat different,” Michele de Nevers, a senior programme associate at the Centre for Global Development (CGD), a Washington think tank, told IPS.

“The Stern Review really focused on the costs of climate change, trying to make the point that the costs of halting or reversing climate change was relatively small in the global context. This new review, on the other hand, wants to focus on the benefits of climate action.”

Such a focus, she notes, could turn the conventional discussion on its head. “The global conversation needs to look at not just the costs,” she says, “but also the benefits that would accrue from climate action, in terms of economics, health and environment.”

Question of implementation

In developing and developed countries alike, a primary stumbling block in international climate discussions remains the amount of money both adaptation and mitigation efforts will require. The new United Nations-overseen Green Climate Fund, for instance, is aiming to raise 100 billion dollars a year by 2020 from industrialised countries, but even the first year’s pot of money has been slow to come together.

Similar debates are happening at national and community levels throughout the world, as well, as the impacts of growing weather extremes are becoming better understood. For the moment, much of this discussion continues to revolve around the sometimes staggering estimated costs of adaptation efforts and converting energy systems to be less carbon-intensive, and around the prospect that these efforts could raise significantly business operating costs.

In part for this reason, some are cautious in welcoming the new review, wondering whether the commission’s composition will be able to offer the innovative impetus required to guide the global climate discussion.

“A fresh focus on the economic consequences of climate change is very much needed, but this looks a bit like an exercise in rounding up the usual suspects – there’s significant overlap with previous … panels asking the same questions, which produced long reports that weren’t implemented thanks to the reluctance of industrialised countries to contribute their fair share,” Oscar Reyes, an associate fellow with the Climate Policy Programme at the Institute for Policy Studies, a Washington think tank, told IPS.

“With bank bailouts leading climate funds to dry up, we unfortunately now see those same industrialised countries pushing for a climate finance system that’s even more dependent on the financial sector. This won’t change unless governments start to rethink their economic policies in light of the urgent climate challenge.”

Still, mounting research is making it increasingly difficult for lawmakers to ignore the prospect that climate inaction could ultimately be more expensive than policy overhauls.

New research from China, for instance, suggests that a small carbon tax would have a substantive impact on greenhouse gas emissions even as it cuts down on the air pollution that has substantially driven up health costs in that country.

Likewise, the official U.S. government auditor this year added climate change to the list of issues that pose the greatest financial risk to the government and country – and warned that Washington is markedly unprepared to deal with the scope of the problem.

The Government Accountability Office reported that disaster declarations in the United States increased to a record 98 in 2011, compared with 65 in 2004, requiring a total 80 billion dollars during that period. Further, this figure was nearly equalled by the single request, late last year, for more than 60 billion dollars in response to Superstorm Sandy, the hurricane that ravaged much of the country’s northeast.

“The launching of this new commission is extremely timely, in part because this country and other countries have finally started coming to terms with the increase in extreme weather events,” Nathaniel Keohane, vice-president of international climate at the Environmental Defence Fund, told IPS after attending the commission’s formal launch.

“That makes this kind of deep dive into the positive stories around the economies of climate change very timely. We need to move away from the old debate about what this will cost to recognise not only the price of inaction but also the opportunities that climate action will have for economies, jobs and innovation.”

Environmentalists and policy advocates say they will now be looking forward to the commission’s recommendations, as well as the potential impact the initiative’s report could have on the global negotiations to agree on a new international agreement on climate action, due the following year.

“One would hope that the report could put new energy and momentum into those talks,” CGD’s de Nevers says. “The process towards 2015 is for governments to identify their country-specific goals, but understanding that there are other economic, health and environmental benefits in play could put momentum toward being a bit more ambitious.”

Fast food workers on strike in New York City, July 2013. Credit: mtume_soul/cc by 2.0

By Carey L. Biron
WASHINGTON, Sep 19 2013 (IPS)

Regulators here are proposing that most U.S. corporations be required to provide annual public reporting on how the pay received by their chief executive compares to that of their average workers, a requirement proponents say could be a first step in reining in an unprecedented swelling in executive compensation.

If the rule is adopted, corporations would need to calculate this ratio for all workers, “including full-time, part-time, temporary, seasonal and non-U.S. employees”, according to an official release. This would also apply to workers employed by a company’s subsidiaries, including those not located in the United States.“It was misaligned pay that caused bankers to blow up Wall Street in the first place." -- Bartlett Collins Naylor of Public Citizen

The Securities & Exchange Commission (SEC), which voted to approve the proposal on Wednesday, was directed by the U.S. Congress to create the pay gap rule nearly three years ago. Although full details have not yet been made public, proponents of the rule say the proposal appears to have come out quite strong.

“We think it’s a home run – it includes basically everything we wanted,” Sarah Anderson, director of the Global Economy Project at the Institute for Policy Studies, a Washington think tank, told IPS.

“There was an intense effort made to water down this rule, particularly to allow companies to exclude overseas and part-time seasonal workers, so we’re thrilled to see the SEC stood up to that pressure. It’s important that shareholders and the public understand that the process of globalising the workforce and the extreme pay gap within companies have just as much of a detrimental effect for U.S. companies that might be operating in other countries as for U.S. workers.”

At 3-2, Wednesday’s vote by the SEC commissioners was close, with both “no” votes coming from Republican commissioners. Company executives and business lobby groups have repeatedly stated in recent years that the new rule would be burdensome, warning that the information is unnecessary and only feeds into populist attempts to embarrass top executives.

On Wednesday, the Centre on Executive Compensation, an advocacy group that has strongly opposed the pay ratio requirement, criticised the new proposal as a “political disclosure, rather than a substantive one”.

The U.S. Chamber of Commerce, the country’s largest industry lobby group, likewise came down on the rule as “another example of special interests promoting policies contrary to the interests of investors and the businesses they invest in”.

Yet the Institute for Policy Studies’ Anderson notes that since the late 1970s management scholars have been warning against allowing CEO-to-worker pay ratios from becoming too large. She points to years’ worth of research that suggests that extreme pay differentials are bad for worker morale and productivity, thus making companies and the overall economy less efficient.

Yet in the United States, this pay gap has grown larger than at any other point in modern history. While CEOs of major companies in 1982 ago took home around 42 times the pay of their average workers, by last year that number had grown to 354 times larger, according to analysis by the AFL-CIO, one of the country’s largest labour unions.

While the new disclosure is seen as empowering shareholder decision-making, Anderson says it could also have an impact on workers around the world.

“One argument by corporations was that this calculation was too difficult to figure out because they didn’t know how much they were paying workers in other countries – another sign of companies’ attempts to distance themselves from taking responsibility for their actions in other countries,” she says.

“The SEC clearly didn’t buy that argument, and this rule emphasises that U.S. corporations are responsible for their overseas operations. Perhaps this could now help with the broader push towards corporate accountability.”

Growing inequality

The new proposal is part of a mammoth financial-services overhaul bill, the Dodd-Frank Act, that passed Congress in 2010 and aimed at dealing with the regulatory failures blamed for leading to the financial collapse of 2008-09. The pay-gap rule, known formally as Section 953(b), is one of several regulations the SEC has been mandated to write to tighten oversight of CEO compensation, particularly in the banking sector.

“It was misaligned pay that caused bankers to blow up Wall Street in the first place, though because CEOs are so overpaid they can afford to attack anybody that makes even a small effort to reform how much money is wasted on them,” Bartlett Collins Naylor, a financial policy advocate with Public Citizen, a consumer advocacy group here, told IPS.

“This new proposal seems generally fine, though it’s such a simple rule it’s hard to see how they could screw it up. Imagine – it only took the SEC 1,825 days to implement the first Dodd-Frank rule on pay reform!”

Naylor did express some frustration over some of the exemptions the SEC has included in the new proposal, however. These include small companies as well as “emerging growth” corporations, meaning those with less than one billion dollars in annual gross revenues.

In both instances, Naylor says, calculating the ratio between a CEO’s pay and that of a median employee should be very simple.

Wednesday’s vote on the rule proposal now kicks of a 60-day public comment period, though the issue has already received attention. Introducing the pay ratio vote Wednesday morning, SEC Chair Mary Jo White noted that the proposed rule has already prompted more than 20,000 comment letters, which she characterised as “significant interest”.

If the rule eventually passes, the United States would be the only country to require such disclosure. That may make sense, however, given that the pay gap between workers and company heads is larger here than anywhere else in the developed world – another indication of broader inequality that continues to grow.

On Tuesday, the U.S. Census Bureau released an annual study on poverty that found that both annual median income and the poverty rate failed to change over the previous year. This means that average full-time workers in the United States are actually receiving lower compensation than they were in the early 1970s, according to the Economic Policy Institute, a think tank here.

And last week, a California researcher published findings showing that U.S. economic inequality is currently worse than at any time since 1927. In looking at tax data, economist Emmanuel Saez found that, last year, the top 1 percent of U.S. earners took in some 19.3 percent of all household income, while the top 10 percent took in nearly half of all income.

President Barack Obama signs the Dodd-Frank Wall Street Reform and Consumer Protection Act in July 2010. Credit: Lawrence Jackson, Official White House Photo/Leader Nancy Pelosi/CC by 2.0

By Carey L. Biron
WASHINGTON, Aug 28 2013 (IPS)

Three years after the passage of landmark legislation aimed at strengthening regulation of major U.S. companies, one of the most criticised disparities characterising today’s corporate culture – the outsized compensation offered to top executives – continues to grow.

These extraordinarily lucrative salaries and benefits appear to have little connection to overall corporate performance. According to estimates released Wednesday, 38 percent of the top-paid chief executive officers (CEOs) of U.S. companies over the past two decades were fired or headed companies that were either bailed out by taxpayers or forced to pay significant fraud-related fines.

“An alarming number of CEOs are not adding exceptional value to [the U.S.] economy. They are extracting vast sums from it,” a new report from the Institute for Policy Studies, a Washington think tank, stated.“An alarming number of CEOs are not adding exceptional value to economy. They are extracting vast sums from it.”
-- The Institute for Policy Studies

“American chief executive compensation continues on what has become an inexorable upward march, even as the overall economy sputters through five years of Great Recession and tepid recovery. The most widely heralded CEO pay reforms…have so far done little to slow the executive pay march.”

The study looks at the performance of the 241 CEOs who have ranked among the United States’ 25 highest-paid executives at some point over the past 20 years. Researchers found that many of their companies reported “blatantly” poor performances.

Nearly a quarter of the companies either shut down or received government bailouts following the 2008-2009 financial crash. Eight percent of these CEOs were fired but still received final bonuses averaging 48 million dollars, while an additional eight percent headed companies that had to pay fraud-related settlements of more than 100 million dollars per firm.

“Shareholder representatives say that the problem of excessive CEO pay is so widespread that even if you wanted to create a portfolio of those companies that enforce reasonable CEO pay, it would be very difficult to do so,” Sarah Anderson, an author of the new report and director of the Global Economy Project at the Institute for Policy Studies, told IPS.

“This is not just a problem of a few bad apples,” Anderson said. “Rather, it’s about a corporate culture that’s encouraging CEOs to demand this type of compensation – even though it’s bad for workers, shareholders and taxpayers.”

The U.S. model

The average compensation for heads of the country’s 500 largest companies was around 12.3 million dollars in 2012, according to estimates by the AFL-CIO, one of the United States’ largest trade union federations. Excluding an unusual massive pay cut taken by one executive (Apple CEO Tim Cook), that figure rose five percent over 2011, despite the fact that median incomes for most U.S. households fell from 2009 to 2011 by 0.4 percent.

CEO pay has skyrocketed in recent years compared to average U.S. salaries. In 1993, executive salaries were around 195 times those of average workers, according to the AFL-CIO. Last year, they were 354 times larger.

“Two decades have essentially recalibrated our nation’s moral sensibilities,” the Institute for Policy Studies report states. “The outrageous has become the everyday.”

Meanwhile, this U.S. “model” of outsized executive salaries is widely credited with encouraging executives in other countries, particularly Europe, to push for similar levels of compensation, to the anxiety of top economic analysts.

“We must move in the direction of more prudent compensation practices,” Christine Lagarde, head of the International Monetary Fund, the Washington-based institution tasked with ensuring global economic stability, said in January at the World Economic Forum.

“Excessive inequality is corrosive to growth; it is corrosive to society…We can already see too many signs of waning commitment – dilution of reforms, delays in implementation, inconsistency of approaches.”

In the aftermath of the 2008-2009 financial crisis, much of the legislative push to reel in executive pay in the United States became part of a huge bill known as the Dodd-Frank Act, which is aimed at strengthening oversight of the financial services industry and broader corporate culture.

While that bill, signed into law in 2010, mandated federal regulators to take multiple steps to address the issue of excessive executive compensation, today relatively few of these rules have been finalised.

Some of those that have – including allowing shareholders to vote regularly on executive salaries – are less effectual than was anticipated. In fact, the new report includes a detailed “scorecard” of the efficacy of these reforms, both proposed and potential, that affect executive compensation in the United States and Europe.

Recent polling suggests that support among the U.S. public for strengthened regulation is growing. In July, pollsters found that 83 percent of likely U.S. voters supported tougher regulations for financial companies – up from 73 percent last year (respondents weren’t specifically asked about executive pay).

President Barack Obama has also recently stepped up calls for regulators to move more quickly on Dodd-Frank rules, including on executive pay and equality issues more broadly.

“We’ve got more work to do,” Obama said on Jul. 24. “Nearly all the income gains of the past 10 years have continued to flow to the top one percent.”

“The average CEO has gotten a raise of nearly 40 percent since 2009. The average American earns less than he or she did in 1999.”

Narrowing pay ratios

Some movement is ongoing to address executive compensation. In early September, the Securities and Exchange Commission (SEC), which regulates all companies listed on U.S. stock exchanges, is slated to finalise a rule that would require corporations to regularly publish the ratio of pay between its workers and executives.

While some business interests have derided such disclosure as unnecessary (and legislation proposed in June would undo it completely), at least one important lobby group, the Business Roundtable, told IPS that it would be withholding judgement until after details of the rule, known as Section 953(b), are published.

And while there is some concern over how the SEC will allow companies to define their employee pool when calculating this ratio, advocates of stricter regulation are saying this would be an important step.

“We do think this is a big deal, in that it legitimises the idea that narrow ratios are a good practice,” the Institute for Policy Studies’ Anderson says.

“Eventually, you could also use those ratios in other ways – considering that ratio when determining government contracts, for instance, or linking the ratio to favourable tax policies.”

U.S. Secretary of State John Kerry steps off a helicopter after flying from Amman, Jordan, to Ramallah, West Bank, to meet with Palestinian Authority President Mahmoud Abbas on Jul. 19, 2013. Credit: State Department photo/Public Domain

By Mitchell Plitnick
WASHINGTON, Jul 23 2013 (IPS)

There is a real opportunity for peacemaking between Israel and the Palestinians, even though the obstacles are more formidable than in the past. That was the assessment of former U.S. president Jimmy Carter, speaking Monday at a public event which posed the question “Can the Two-State Solution Be Saved?”

“This is a propitious time because there has been a five-year absence of the two parties coming together and they’ve been very resistant even to accommodation to come together,” Carter said.

“So that’s an encouraging sign. There is great pressure on both leaders not to come to table if [the negotiations are] based on borders. Palestine will ask the U.S. to state [what is] their official position and international law, which is that terms must be [based on] the 1967 borders, and land swaps can only happen in free and fair negotiations.”

But Phyllis Bennis, the director of the New Internationalism Project at the Institute for Policy Studies, thinks the framework for negotiations between Israel and the Palestinians is inherently flawed and until that changes, there is no chance for successful talks.

“Whatever [U.S. Secretary of State John] Kerry promised to get the two leaders to agree to negotiations, these talks about talks will never break out of their 22-year-long failure until the whole premise changes,” Bennis told IPS.

“You can’t hold talks between a wealthy, powerful, U.S.-backed nuclear-armed occupying power and a dispossessed, impoverished, occupied, unarmed population and pretend they come to the table as equals,” she said.

“It’s not surprising that all sides want to keep the terms secret – [Israeli Prime Minister Benjamin] Netanyahu’s cabinet is already rejecting the talks, and [Palestinian President Mahmoud] Abbas has virtually no support for returning to talks while settlement building continues apace. What’s needed is an entirely new kind of diplomacy – not grounded in Israeli power but in international law and human rights.”

Carter also acknowledged that circumstances are quite different than they were when he brokered the peace treaty between Israel and Egypt.

“There was no demand on me to engage in peace talks,” Carter recalled. “But [Egyptian president] Anwar Sadat and [Israeli prime minister] Menachem Begin were strong, courageous, and wise enough to reach an agreement. I think what Secretary Kerry faces now may be more formidable. But the key issue is whether the people will prevail on their leaders to make peace.”

Kerry announced last week that a formula had been found that would bring Israel and the Palestinian Authority back to the negotiating table after a nearly five-year long hiatus.

But the Palestinians have said they are not yet committed to the new round of talks, as they expect negotiations to be based on the 1967 borders. Israel, for its part, has announced a release of long-held Palestinian prisoners as a good will gesture, but has also been reported to be pressing Kerry to amend the terms of reference to include Palestinian recognition of Israel as a Jewish state.

Despite this lack of commitment from the parties, preparations are going forward. Reports from both Washington and Israel indicate that the former U.S. ambassador to Israel, Martin Indyk, will be named as the lead negotiator for the U.S. team.

And both the Palestinians and Netanyahu have declared that any agreement reached will be subject to a public referendum.

Carter believes the referendum idea is a good one, not only to confirm the legitimacy of any deal that might be struck, but also as added pressure on the leaders to come to an agreement he believes both sides still very much want.

“I think the referendum is a good idea, because Prime Minister Netanyahu also said he would not formalise an agreement without a referendum. This is exactly the same as Hamas’ position,” Carter said referring to the long-held stance by the Islamist leadership in the Gaza Strip.

In December 2010, Gaza’s Prime Minister Ismail Haniyeh of Hamas said, “Hamas will respect the results [of a referendum] regardless of whether it differs with its ideology and principles.”

Carter continued, “I think [a referendum’s] good, because if leaders accept an agreement I think it almost guarantees people back home will accept the same thing.”

Despite the optimism Carter expressed, scepticism surrounding the renewal of talks is dwarfed by that surrounding the chances of such talks succeeding.

Many observers have noted the ongoing divisions between the Palestinian Authority and Hamas, the continued unwillingness of the United States and Israel to negotiate with a Palestinian government that includes Hamas, and the anti-peace stance of much of Israel’s ruling coalition, including Netanyahu’s own Likud party. All of these factors generate a great sense of pessimism.

Carter believes that if a deal is worked out that the leaders of both sides agreed upon, there would be overwhelming support for it.

After meeting with the leader of J Street, which calls itself a “pro-Israel, pro-peace” lobbying group, he said, “I pray that if progress is made toward a two-state solution, it will have support not only on a worldwide basis, but also in America even from those who might not have thought this is possible.” Yet even he recognises major obstacles.

Asked by IPS about Israel’s determination to maintain a long-term presence in the Jordan Valley, something the Palestinians are never likely to accept, Carter said, “The Jordan Valley was never mentioned as being controlled by Israel after peace in my day. We anticipated that Israel would withdraw from all of Palestine east of the green line. I am not sure the Palestinians will ever accept Israeli control of Jordan Valley.”

Carter also stated that Israel’s occupation was a violation of its commitment to United Nations Security Council Resolution 242 but that if the 1967 borders were the basis for resumed talks, that would “honour the basic thrust of 242″.

Carter added that Palestinians would have to resign themselves to only a token return of refugees to Israel and that their right of return would have to be exercised only in the West Bank and Gaza Strip.

U.S. President Barack Obama's in Accra, Ghana in 2009. Credit: US Army Africa/CC by 2.0

By Cydney Hargis
WASHINGTON, Jun 24 2013 (IPS)

Advocacy groups here are urging U.S. President Barack Obama to focus on more than just economic development during his upcoming trip to Africa.

They are also hoping that the state visits will be able to turn the tide on years of U.S. engagement with Africa only through the lens of security and counter-terrorism.

Starting Wednesday, Obama will visit Senegal, South Africa and Tanzania on what will be his second trip to the continent as president. His advisors say he hopes to focus on increasing trade, investments and other economic opportunities.

“This shouldn’t be a light-hearted and easy trip,” Adotei Akwei, Africa advocacy director for Amnesty International, told IPS. “It shouldn’t just be about economics and investing, because there are some serious issues that need to be addressed.”

According to aides, Obama will also put significant emphasis on supporting growing democracies in each of the three countries, as well as on the African youth population."If the U.S. wants to be in step with the 21st century and the centuries to come...it needs to pay attention to Africa." -- Emira Woods

“Each of the countries that we’re visiting are strong democracies,” National Security Advisor Ben Rhodes said in a White House briefing conference call. “The president has made it a priority to support the consolidation of democratic institutions in Africa so that Africans are focused not just on democratic elections, but institutions like parliaments, independent judiciaries and strengthening of the rule of law.”

In addition to bilateral meetings with political leaders in the three countries, Obama will participate in events with private sector leaders. Development issues will play a role, particularly regarding food security.

“Food security has been one of our key development priorities,” Rhodes said, “in which we’ve brought together the international community as well as the private sector behind approaches that strengthen African capacity in developing agricultural sectors that better feed the populations.”

Obama has been criticised for paying relatively little attention to Africa during his presidency. His first and only trip to the continent lasted less than 24 hours.

“If the U.S. wants to be in step with the 21st century and the centuries to come,” Emira Woods, the co-director of Foreign Policy in Focus at the Institute for Policy Studies, a Washington think tank, told IPS, “it needs to pay attention to Africa.”

Security focus

Further, for many humanitarian advocates, what little focus Obama has paid to Africa has been largely security related.

“I am concerned that in recent years, the degree to which there is a focus in Africa has been aimed at counterterrorism initiatives,” John Hutson, director of communications at the Enough Project, a Washington advocacy group, told IPS. “I hope this trip will create a sense of interest and actions that will help African development and thereby help the United States.”

The Institute for Policy Studies’ Woods concurred, “The U.S. has focused overwhelmingly on the security sector, at the expense of those other building blocks of a healthy society.”

Obama will not be visiting two of the continent’s most unstable countries, Somalia and Mali. Yet according to some observers, the instability in these parts of Africa is due in part to U.S. support of authoritarian regimes.

Independent policy analyst and activist Nii Akkuetteh applauded the Obama administration for not visiting countries that, at a panel discussion here Monday, he called “U.S.-friendly tyrants”.

“The criticism right now is, if you flood a country like Mali with arms and it goes wrong, we don’t think it’s right to turn your back on the problem,” said Akkuetteh. “It is in the U.S.’s best interest to help Mali rebuild since they were partners when Mali slipped into their problematic state.”

Meanwhile, others are pointing to climate change as a more pressing long-term security threat to Africa. On Tuesday, Obama is scheduled to unveil a major new U.S. policy push to combat climate change, but so far Washington has been a significant contributor to the inability of international negotiations to arrive at a comprehensive agreement on the issue.

“Clearly what we are calling for is for the Obama administration to look at the affects of its policies on climate change,” said Woods. According to Dev Kar, chief economist at the research and advocacy organisation Global Financial Integrity, scientists and security analysts are already forecasting a increase in the number of conflicts in Africa and beyond as a result of water shortage.

According to recently released World Bank data, such an uptick will likely be visible within decades.

Meanwhile, the cost of Obama’s trip, reportedly from 60 to 100 million dollars, has led to some furious criticism from within the United States, where austerity measures are continuing to upset long-running government programmes. But Amnesty International’s Akwei suggests this is not only a sideshow, but a problematic indication of the broader U.S. view of Africa.

“This criticism continues a sad trend of the perception of the continent, which is basically that it doesn’t matter and its irrelevant,” he said.

“In fact, it is relevant. It is a major front of the Pentagon and its work on terror, it is a major source of oil to this country, and it is a humanitarian focal point.”

The United States’ main foreign assistance agency is getting widespread plaudits for new data on a series of internal reforms aimed at aid improvement, but some development experts are pointing to a persistent opaqueness from the agency.

In a first-of-its-kind report released this week, the U.S. Agency for International Development (USAID) has laid out the progress it has made under a key reform initiative undertaken over the past three years.

“This report does provide a nice, concise summary with policy descriptions and challenges, but it could go further in its attempt to be transparent,” Sarah Rose, a senior policy analyst on the Rethinking Foreign Assistance team at the Center for Global Development (CGD), told IPS.

The report focuses heavily on new evaluation policies aimed at increasing accountability and country ownership, incorporating new technologies (“from improved seeds to mobile phones”) and leveraging “high impact” partnerships, specifically with the private sector.

In the past, USAID has been widely criticised for a lack of transparency. While the agency is currently in the midst of a massive overhaul of related policies, just this past October an advocacy group called Publish What You Fund ranked USAID just 27th out of 43 foreign aid agencies, in terms of transparency.

To address such criticisms, in 2010 President Barack Obama unveiled a policy directive that spurred the new round of reforms. At the forefront of its objectives were the development of “robust … budget and evaluation capabilities”, progress toward which the new report outlines.

For instance, a new policy has been introduced that requires every major U.S. aid project to undergo a rigorous evaluation conducted by an independent third party. The report touts that this new policy has already been called “a model for other federal agencies” by the American Evaluation Association, a professional association for evaluators, and that it has led to budgetary changes in a third of the cases examined.

Some aid organisations have also expressed enthusiasm about increasingly collaborative partnerships between the United States and recipient countries, a break from the old structure in which the host countries were seen as less active participants in project design.

“The progress demonstrated in the report, especially on promoting sustainable development through high-impact partnerships, demonstrates a commitment to ensuring that people are the leaders of their own development,” Gregory Adams, Oxfam America’s director of aid effectiveness, said in a release.

They point particularly to the development of Country Development Cooperation Strategies (CDCS), five-year plans drafted collaboratively by the United States and recipient countries that identify the needs of partner countries and detail specific paths forward. CDCSs ostensibly give host countries more of a stake in USAID development projects.

The new report finds that the percentage of USAID funds allotted to local institutions grew from 9.7 in 2010 to 14.3 in 2013. That puts the agency at the halfway mark of a five-year goal of 30 percent by 2015.

Transparency concerns

Still, many see room for improvement in USAID’s partnership strategies.

“USAID has done a good job refurbishing its human capacity and bringing on additional people,” George Ingram, the co-chair of the Modernizing Foreign Aid Assistance Network (MFAN), an advocacy group, told IPS.

“But it needs to do a better job providing its employees with training and advanced managerial skills to help them keep abreast of new developments.”

Transparency and accountability concerns are also central. Although the report outlines a 50-percent increase in local partnerships by USAID, it lacks detail about what local institutions were partnering with USAID.

“There are a number of stakeholders who want to know exactly what those local partnerships are,” CGD’s Rose told IPS. “Doing so would allow stakeholders to do their own analyses.”

Similarly, although the paper reported that USAID had increased its public-private partnerships by 40 percent over the past three years and leveraged an additional 383 million dollars of non-U.S. government money toward development goals, the report made little mention of the companies or projects involved in those partnerships.

For some, the greatest threat to increased transparency could be a greater reliance on private-sector funds in development assistance. This has been at the core of a decade-long shift in USAID projects, and now looks set to continue to increase.

“In a world where foreign direct investment flows vastly outpace development assistance,” the report states, “we have to enable global investment and local private sector entrepreneurs to serve as engines of sustainable growth for even the most vulnerable communities.”

MFAN’s Ingram says that public-private sector initiatives can indeed be complementary in supporting economic growth in host countries.

“To some extent, government organisations are good at formulating plans about what needs to be done,” he says. “But the private sector knows how to get those things done – on the ground, in the marketplace, for their clients.”

But Ingram also notes looming barriers to public-private cooperation, highlighting the possible obstacles to transparency that a strengthened public-private partnership would imply. There is a degree of “public trust”, he says, to which government agencies are beholden by virtue of operating on taxpayer funds.

“In honouring and respecting that public trust, [government agencies] end up developing a lot of rules and regulations to make sure that the way they conduct business is open to public scrutiny,” he says. “In the end, there has to be some balance between the rules and responsibilities that come with public funds, and the private sector that isn’t used to that.”

Indeed, the private sector’s inclination toward efficiency and profit at the expense of oversight and accountability is precisely what concerns many development advocacy groups here in Washington.

In a conversation with IPS earlier this month, Janet Redman, director of the Sustainable Energy and Economy Network at the Institute for Policy Studies, a Washington think tank, expressed concern about public-private aid collaboration blurring the line between two very different measures of progress.

“The danger lies in pretending gross domestic product and foreign direct investment are the same thing as making economies more sustainable and enabling them to meet the needs of their citizens,” she said.