Module 18 Concepts
Polarity - counts the number of great powers in the international system. Since the end of the Cold War the international system has been classified as unipolar. The U.S. stands as the most powerful state. However, many analysts believe that this unipolar moment is fleeting. The distribution of power is diffusing becoming more multipolar. In 1991, directly after the Soviet collapse the U.S. was by far the most militarily capable of the world power. Now, in 2018, the concentration of military power has diffused and countries such as China and India have grown their military capabilities. We are probably in the waning moments of unipolarity and in transition to a more multipolar system. Why is polarity important? Polarity shapes great power politics by helping to structure coalitional dynamics. A destabilizing realignment occurs when one power abandons an alliance and joins another. These realignments are more likely under a multipolar system which implies that great power war might be more likely under a multipolar system. Relationships are less stable in multipolar systems. Ex: the runup to WWII. These ideas find support in the Cold War, a bipolar system which is arguably more peaceful and stable by scholars. Because the two powers are so far ahead they don’t have to worry about abandonment or power shifts among smaller powers. Bipolarity tends to be more stable than multipolarity. Others argue that unipolarity is even more peaceful than bipolarity. The concept of unipolarity is often used to understand the relative absence of great power challenges to American military dominance since 1991. While China is advancing, it isn’t threatening to fight a war with the U.S., this also applies to Russia.
We also discuss several other topics like What does the cult of true womanhood suggest?
Power Transition Theory - shifts in the distribution of power among great powers can encourage declining powers to launch preventive wars against rising powers. They hope to use war and military defeat to prevent the rising power from altering the rules of the global order. They fight because the rising power cannot commit to maintaining the larger international status quo once it becomes the most powerful state. This is the commitment problem. Such concerns play a prominent role in debates about future U.S. relations with China. How will China seek to alter the global trading system once it’s surpassed the U.S. in power? If you want to learn more check out What are the detriments of clinical anger
Maritime Disputes in the South China Sea
The source of the tension in the South China Sea revolves around Chinese actions in this area over 500 miles from its coastline. China has been building small man-made islands in the South China Sea in an island chain called the Spratly Islands. These islands are made to support infrastructure such as buildings or airstrips. The biggest fear for the U.S. and its allies in the region is that China will use these islands to make and enforce territorial claims to the Spratly Island chain and close off the South China Sea or reserve the right to patrol it. China has already claimed these regions as sovereign territory. The construction of these man-made islands could allow China to provide facilities to enable air and sea patrols for their navy. The U.S. and its allies view this as attempts by China to assert itself at the expense of the U.S. and its influence. Some have even likened it to the Monroe doctrine which asserted American hegemony to
European powers. The Obama administration consistently criticized these moves by China. Steve Bannon argued that this dispute would eventually lead to war between the U.S. and China. The U.S. has responded to the construction of these islands with a series of freedom of navigation exercises. In these military maneuvers, the U.S. navy sometimes sails its vessels within 200 miles of an island that China is building. This distance is important because the UN convention on the law of the sea generally sets the maritime boundary of a country’s territorial possession at 200 miles from its coastline. By sailing U.S. vessels within that 200 mile boundary the U.S. is sending the message that it does not recognize China’s sovereignty over these islands. China has called these actions a deliberate provocation. Conventional wisdom states that China and the U.S. have powerful economic reasons to minimize conflict with each other. At the same time, the ongoing shift in power towards China could destabilize this relationship. Conventional wisdom also holds that any spark that could create tension would likely be over Taiwan. These views are shifting and now many observers believe that instead the spark to destabilize relations could be the maritime disputes in the South China Sea. Skeptics of China’s rise point to their activities as indicative of a broader set of revisionist interests consistent with power transition theory. American military exercises and the stationing of Chinese air-force squadrons on the islands are both provocative and could set off a chain of escalating responses. A crisis could be inadvertent and destabilizing. Neither side wants a dispute here but there is some risk that this dispute over access to the South China Sea could destabilize what has been a productive relationship between China and the U.S. If you want to learn more check out What led to the establishment of microbiology?
Module 19 Concepts
Institutions - the rules of the game in a society, the humanly devised constraints that shape human interaction. They structure incentives in exchange. Institutions are rules governing human interactions. Like most rules, institutions tend to reward certain behaviors and punish other ones. Institutions influence politics by channeling behavior through incentives that reward and punish certain actors. In domestic politics institutions can be thought of as laws that tell us how to and how not to behave. They also help to regulate political competition. Ex: electoral laws. In international politics institutions can be thought of in terms of sovereignty. Once states recognize other states as independent members of the political system, they confer on them sovereign rights. Norms and laws discouraging the use of nuclear weapons are also international institutions. These rules limit how states fight wars. Institutions vary in their effectiveness. Some states frequently ignore rules. However, they are still important because they provide standards for behavior that the international community can use to evaluate the actions of others and decide upon punishments for violations. International Organizations (IO) - political actors in the system, include individuals and groups from many states, members are often nation-states. They are generally created by these member-states to fulfill some set of political goals that members share. Ex: UN, NATO. International institutions might be important components of international organizations. Ex: The WTO (IO) was created to defend international institutions (II) toIf you want to learn more check out Which unit is used to measure wavelength?
eliminate trade barriers. However, international organizations still possess agency and political incentives that drive their behavior in the international system. International organizations act to pursue objectives, international institutions cannot act. Institutions and organizations play functional roles in international politics. (1) Institutions regulate behavior and tell states what they can and cannot do. These rules are designed to minimize conflict in the international system. Ex: The recognition of sovereign rights are meant to be reciprocal. Both states agree not to violate each others borders or interfere in domestic decisions in the other state. This rule tries to eliminate conflict by allowing each to determine their own laws. The specification of these rules makes it easier to identify violators and threats to these rules. (2) Institutions provide information about other states. These codes of conduct can be used to assess the behavior of any actor. International institutions are meant to foster cooperation. Cooperation can be difficult to achieve in international relations because governments are independent and politically responsible to their own people not necessarily foreign governments. This means that they might face limited penalties for breaking agreements with foreign governments. International organizations can help to solve some of these challenges of cooperation including the free-rider problem, trade conflicts, and the enforcing of international agreements. Any agreement among states requires some type of negotiated settlement. International organizations can help to reduce the transaction costs associated with cooperation by providing rules and guidelines that structure negotiations. Ex: WTO. (3) Participation in international organizations can provoke tension with domestic autonomy and sovereignty. By participating in an international organization like the WTO, states delegate some responsibility for the making of their trade policy to those who run the WTO and states that are part of the WTO. These actors have the power to influence the trade policy of states by penalizing trade. Ex: 2002 Bush raised import duties on steel. Countries challenged these tariffs with the WTO who forced Bush to rescind the tariffs. This illustrates the tension that international institutions can create in domestic policy. While these international organizations supported U.S. policy goals and reinforce American political leadership, they also can impose political costs on the U.S. government because of the authority they hold. Don't forget about the age old question of What do puritans restrict other people to have?
The United States and the United Nations
Sovereignty creates expectations about how states will conduct relations with each other, defining what they can and should not do. International Organizations also foster cooperation among states by providing information about their national interests which can be used to predict their willingness to cooperate in the future. The United Nations - oversees a large bureaucracy that is involved in peacekeeping, nuclear weapons inspection, public health, humanitarian aid, and the protection of human rights. When states try to secure international political support for some important foreign policy action they appeal to the UN. There are two main political bodies within the UN (1) General Assembly - All member states can sit in the General Assembly, this means it rarely achieves consensus. At the same time, this universal membership provides a powerful political vehicle to secure international legitimacy when states can achieve supportDon't forget about the age old question of What is the primary purpose of an arraignment?
from the general assembly for a given action. (2) Security Council - five states have permanent seats on the security council (U.S., U.K., China, Russia France). This preferential access is a function of how WWII ended. All of the permanent members have the institutional power to veto or block any matter before the security council. Accordingly, this body needs to find consensus before it can act. The Security Council also includes ten rotating members. For many Americans this is a frustrating international organization. The U.S. contributes significant financial resources to the UN and it often seems ineffective. Part of this ineffectiveness stems from the political diversity. All states have voice within the UN which means that a small group of states can block a large group of states from reaching a policy goal. The UN is still important to international politics and the conduct of foreign policy.
In the video clip shown, Jon Stewart argues that the UN is basically useless. This begs the question why the world then cares so much about the UN. The answer rests in part on the capacity of the UN to bestow political legitimacy on foreign policy actions. Securing international legitimacy can reduce the political cost associated with implementing an action. UN approval can also shape public opinion in the U.S. when a president contemplates the use of force. Public support for war at home increases when the president secures UN approval. In sum, the UN can be a powerful source of legitimacy for potentially controversial policies.
The United States and NATO
NATO - is a military alliance and international organization. The rules governing NATO are institutions and have a great effect on international politics. Ex: The rule in NATO that an attack on one member state will be viewed as an attack on all member states lies at the heart of the collective security guarantee of the alliance. Moreover, rules requiring that member states within NATO not have any territorial claims against other states and maintain democracy help to solidify peace within the alliance between its member states. Many argue that the carrot of NATO membership enticed countries in Eastern Europe to pursue democracy after the collapse of communism. NATO has its origins in the Cold War, the alliances chief function was to provide military security for West Europe in case of a Soviet attack. In actuality, NATO performed three interlocking goals that helped to establish a zone of peace in Western Europe. The goal of NATO was “to keep the Russians out, the Americans in, and the Germans down”. These three goals represent the three benefits of the collective security arrangement. (1) Keeping the Russians out referred to NATO’s chief function, to provide security against a Soviet attack in Western Europe. (2) NATO was a binding mechanism for American military power. By establishing an American led alliance system, NATO provided a necessary hegemon for the security arrangement. As the hegemon the U.S. provided military security but was also restrained by the agreement. The alliance forced the U.S. to work multilaterally and take concerns of its European allies into account. (3) Keeping the Germans down referred to NATO’s role of maintaining peace between democratic powers in Europe by integrating them into an alliance that was led by an outsider in the U.S. Prior to the existence of NATO, two world wars erupted
between the same powers (Great Britain, Germany, and France) that became reliable allies under the NATO umbrella. Despite these major benefits, NATO presented some dilemmas. (1) European countries shirked their responsibilities to provide their own military security by not spending enough on their militaries during and after the Cold War. Dwight Eisenhower complained of this, stating that European countries wouldn’t provide the soldiers for their own defense. Both democrats and republicans have made this complaint that the U.S. carries too much of the burden of international security. Trump has complained about this as well. (2) The U.S. has periodically been a reluctant hegemon. NATO provides many benefits to the U.S. but also represents a huge burden. Trump has stated that the costs have outweighed the benefits. This is a prominent challenge facing the alliance but is not new. The remedies being considered by Trump are a radical break from historical policy. Trump has suggested that if Europe does not cooperate and increase contribution then the U.S. will not defend attacked allies. This questions U.S. leadership and threatens the security apparatus that has kept peace in Europe since WWII.
Module 20 Concepts
Democracy - competitive elections is the defining aspect of democracy. What democracy is has been debated by scholars for years. Free and fair elections create democracy. There are three concepts that make free and fair elections possible and maintainable. (1) Public contestation - requires multiple parties competing in elections and the right of citizens to freely express themselves, associate, and receive information from the media. Without these freedoms, elections would not be free and fair and not democratic. (2) Inclusion - the system must allow universal and equal participation of all members of society. If a group is systematically excluded then there is not democracy. (3) democratic sovereignty - democratic elections must result in the establishment of truly powerful decision making bodies such as legislators and chief executives. If a country holds truly competitive elections but the decisions are made by unelected bodies then the country is not a democracy.
The Democratic Peace Theory
The Democratic Peace Theory - holds that the likelihood of military conflict between any two states falls when both of them are democracies. This does not suggest that democracies are more peaceful than non democracies in general. Democracies fight wars with dictatorships at the same
rate that dictatorships fight with each other. Over the past two centuries, war between democracies has been rare and virtually nonexistent. How do democracies keep peace among one another? (1) Elections raise the political cost of going to war. Democratic officials must be cautious of bringing society into war because the cost of war has consequences. It is in the interest of elected officials to find peace. (2) The institutional checks and balances associated with democracy helps to solve the commitment problem among democracies. The settlements constructed among democracies with each other are hard to change domestically. Groups that benefit from peace can block change by directly lobbying institutions. Once a peace settlement
has been set, it tends to remain enforced more so than in authoritarian regimes. (3) Democracies possess a shared democratic identity that fosters expectations on non-violent compromise and a belief that other democratic societies will view them in reciprocal terms. Despite these arguments, there are critiques of the democratic peace theory. Scholars have pointed out that while established democracies tend not to fight one another, countries that are undergoing democratic transitions from authoritarian systems tend to be more likely to experience war than established democracies and dictatorships. Scholars have also offered alternative reasoning for the absence of war between democratic states. One argument is that the peace between west european states during the Cold War was not due to their common democratic regime type, but their common enemy. A similar argument states that peace is a product of American hegemony in Western Europe and Soviet hegemony in Eastern Europe. Each power maintained peace among countries within their spheres of influence and the nuclear standoff kept these states from fighting one another.
The Democratic Peace Theory has played a central role in justifying American efforts to expand the number of democratic regimes around the world. According to this theory more democracies means more trade, cooperation, and peace. The first major wave of democracy promotion in U.S. foreign policy came under Woodrow Wilson who sought to leverage U.S. participation in WWI
to expand the number of global democracies. In particular, he helped to facilitate a democratic transition in Germany after WWI and supported self determination to empower local groups demanding independence from colonial powers. During the Cold War the practice of promoting democracy arguably took a backseat to the primary mission of containment. The U.S. often continued to talk about the superiority of democracy, however in practice the U.S. often allied itself with authoritarian regimes when these regimes would help keep communist forces from seizing power. The U.S. even undermined democratic left-leaning states when it thought they were vulnerable to communism. The end of the Cold War was a boon for democracy promotion. The collapse of communism undermined the idea that the U.S. had to choose between democracy promotion and security/containment. Instead, the manner in which communism collapsed suggested the opposite. The spread of democracy led to security for the U.S. One of the main reasons for the collapse of communism was internal pressure from citizens for more democracy and freedom. As a result, communism disappeared from the international scene as a consequence of the spread of democracy. After the Cold War, the Clinton administration justified intervention in the former Yugoslavia on both humanitarian grounds and motivation to spread democracy. The early 1990s was also the height of optimistic expectations regarding the emergence of democracy in post-communist Russia. Since then, the hope that Russia would become a democracy has faded dramatically. Democracy promotion was also a major part of neo-conservative arguments undergirding the Bush administration’s foreign policy, particularly his decision to invade Iraq. Regime change and the introduction of democracy in the Middle East
was a major part of Bush’s strategy to counter terrorism after 9/11. In the present circumstances, the negative effects of the Iraq war resulted in greater skepticism regarding democracy promotion through the use of American military force. While the Obama administration stressed U.S. commitment to values such as democracy, it was committed to withdrawing forces from Iraq and keeping the U.S. out of similar military engagements. Now, the Trump administration’s “America first” mindset has further diminished the U.S.’s earlier embrace of democracy promotion in foreign policy.
Module 21 Concepts
Globalization and U.S. Trade Policy
Globalization - the integration of national economies into a single global economy. There is evidence of globalization in steadily increasing imports and exports. (X+M/GDP) On average, the proportion of trade relative to GDP for all countries grew during the final years of the 20th century and into the 21st century, indicating globalization. We can also see globalization in the multinational supply chain for products such as the iphone. The stages of the production process occur across multiple countries and continents. The iphone screen may have been made in the U.S. while the battery may have been made in China and the camera in Japan. Then these components may have been shipped to India to be put together and sent to an apple store in Canada. There is an economic piece of each of these countries in the finished product of the iphone. Why do states trade? Globalization and trade integration foster economic growth. Theory of comparative advantage - To maximize economic growth, countries should specialize in some subset of goods that can be produced cheaply in their domestic economy and trade for goods that they can less efficiently produce. This theory shows how specialization and trade generates higher income levels. If governments want to increase national wealth, this theory states that they should eliminate barriers to trade (ex: tariffs). We don’t consume what we produce on a daily basis. The process of specialization and trade makes countries wealthy. So if trade positively impacts the economies of countries, why are trade barriers put in place? One of the biggest challenges associated with globalization is the disproportional gains of subgroups within national economies. Standard Trade Theory - Even though international trade increases the national wealth of the economy in the aggregate, some groups see income gains and others see income losses. The theory tells us that globalization alters the distribution of income within an economy as it increases the aggregate income as a whole. Some groups see their real wages increase while others see their real wages fall due to globalization. This is evident in the declining size of the manufacturing sector in the U.S. over the past 30 years. As a consumer, globalization drives down the cost of products. As a worker, globalization has the potential to collapse your salary if your job is outsourced to another country. The benefits of globalization are therefore not distributed evenly throughout a society. The income losses of some groups gives them reason to lobby for trade policies that insulate the U.S. economy from competition. In some trade models these differential consequences of globalization stem from factor
endowments - the relative quantity of key factors of production (land, labor, capital). These relative factor endowments set the relative prices of these factors as inputs in the production process. So, because the U.S. has lots of skilled labor, the cost of hiring a college graduate is cheaper than acquiring a scarce resource in the U.S. such as land with oil reserves. International
trade helps to create jobs in sectors that rely disproportionately on resources that the U.S. possesses in abundance. This abundance drives down the cost of these factors and makes goods that rely on them as inputs relatively cheaper. Alternatively, globalization tends to drive down the returns to owners of scarce factors of production in an economy. We need to think about the abundance and scarcity of factors of production in the U.S. relative to the ratio of factor endowments in other countries. Ex: unskilled labor is more abundant in India than the U.S. This relative abundance of unskilled labor in India means that firms in India will be able to pay their workers lower wages than competing firms in the U.S. This abundance of cheap labor drives down wages in India and makes manufacturing more cost effective there. Jobs are lost in sectors that rely disproportionately on resources that are scarce in the U.S. Ex: Manufacturing jobs tend to require a lower skill level than computer programming jobs. Globalization allows the U.S. to outsource manufacturing jobs which eliminates these jobs in the U.S. This is a problem for unskilled labor because job creation through globalization is in the sectors that require high skilled labor. This means that low skill workers will struggle to find work that they are qualified to do. The people with scarce factors of production see real income loss. For this reason, the groups who see their income fall because of globalization lobby the government to limit imports and create tariff barriers to protect their incomes. This is one reason governments insulate their economies from competition. Trump has shown this insulation through withdrawing from NAFTA and creating tariffs.
The TPP and U.S.-China Trade Tensions
Trump campaigned and won the presidency partly based on his opposition to globalization. He formally withdrew the U.S. from the TPP in 2017. More recently he has spoken about entering into the partnership again. As Trump has increased tariffs on China, China has retaliated with tariffs on American products. Agricultural workers in Nebraska have pressured their representative Sass to convince Trump to work with China to dispel these tariffs that have harmed their exports. This could have prompted talk of entering back into the TPP to help agricultural exports. The U.S. negotiated the TPP as a device to reduce China’s economic influence in Asia. President Trump lost this leverage over China when he withdrew from the pact. Perhaps the escalation of the trade conflict with China is pushing him to rethink his decision as the U.S. is in need of markets outside of China. The Trans-Pacific Partnership - is an agreement reached by 12 countries (U.S., Canada, Mexico, Chile, Peru, Australia, New Zealand, Brunei, Japan, Malaysia, Singapore, Vietnam) in 2015 to reduce trade barriers among them. Along with eliminating barriers to trade, to create a fair playing field all countries would have to meet standards such as environmental protection standards (no trading endangered
animals) and labor standards (no child labor). Through these standards the Obama administration incentivised member countries to adopt progressive and responsible policies in exchange for economic ties with America. Clinton, Sanders, and Trump all campaigned against the TPP claiming it would harm U.S. workers. China is not involved in the TPP as one of its main objectives is to offset the power of China by strengthening U.S. connections with China’s neighbors. The TPP was also created to later include other countries such as South Korea or Taiwan. Trump eventually signed an executive order to withdraw from the treaty in 2017. After the U.S. withdrew, the remaining countries completed a new agreement in 2018. The size of the TPP would have influenced trade patterns in 40 percent of the global economy. The agreement was meant to increase trade flows, consistent with historical American support for trade liberalisation in the post WWII era. Given Canada’s and Mexico’s participation in the TPP, the agreement would have done what Trump wanted it to do, renegotiate NAFTA. Also, the U.S. was able to secure some concessions that raised labor and environmental standards in other countries. Ex: protect Union. Moreover, the U.S. was able to protect IP rights through the TPP. When the U.S. withdrew from the agreement the remaining countries dropped these provisions. Political opposition to the TPP in the U.S. centered on manufacturing job losses domestically. The TPP also had some important political goals including the omission of China which could reduce Chinese political influence by directing economic activity towards the U.S. Obama pushed the TPP, but the democratic party was less enthused about the deal. The main support among Congress was in the republican party.
The current trade dispute with China began when Trump imposed a 25 percent tariff on steel and a 10 percent tariff on aluminum on all countries. He exempted many major trading partners from these tariffs but did not give China an exemption. China retaliated with tariffs on imports of fruits, wines, pork, and other products to offset their losses from steel and aluminum. The Trump administration responded with another round of proposed tariffs to punish Chinese firms. American farmers have protested these proposed tariffs because they believe that China may retaliate with another round of tariffs cutting agricultural exports. China did propose new tariffs targeting transportation vehicles and agriculture. Soybeans and Sorghum were specifically targeted hard. This imposes political pain specifically on Trump’s main supporters, manufacturers and farmers.
Module 22 Concepts
The Financial Significance of the Trade Deficit
Trade Deficit (current account deficit) - occurs when imports exceed exports in a given year. Politicians cite the trade deficit as evidence of unfair trade practices that are hurting U.S. firms. This also implies that trade deficits undermine the competitiveness of domestic firms and put them out of business, and when American firms go out of business they are forced to lay off American workers. This can be summed up to say that greater imports hurt employment in the U.S. To counter this claim we can look to the balance of payments - which states that a current
account deficit is offset by a capital account surplus. This means that if the U.S. runs a trade deficit it is buying more from foreigners than it is selling to foreigners. The U.S. finances these trade deficits with loans from foreigners. This capital account surplus shows up as more investment capital going into the U.S. Accordingly, a trade deficit indicates a healthy investment climate in the U.S. These capital account surpluses help to drive domestic investment levels up. Foreign investment in the U.S. market increases economic growth in the U.S. which can be a symptom of trade deficits.
The Dollar as a Reserve Currency
The dollar is frequently described as an international reserve currency. This means that many international transactions outside of the U.S. occur in dollars. Ex: the price of oil is in U.S. dollars. When capital holders worry that their investments in other countries will fall in value because the currency in which those investments are denominated will fall, they tend to sell those investments and move to a safer currency such as the dollar. When global markets go down there is often a flight to safety - when investors around the world sell their stocks and bonds in other currencies and purchasing U.S. Treasury bonds with those funds. U.S. Treasury bonds are considered some of the safest investments in the world as investors believe in the credit of the U.S. government. Holding U.S. bonds is like holding cash, they are easy to sell and are basically guaranteed money. All banks must hold some type of reserves to pay their depositors back. The biggest banks in the world (European Central Bank, Japanese Central Bank) hold U.S. Treasury bonds as a source of reserves. This reserve currency status of the dollar is a source of economic and political power for the U.S. It creates a steady demand for financial assets denominated in dollars. Therefore, the global economy relies on the U.S. government to run a budget deficit. When the U.S. government runs a budget deficit it spends more than it takes in as tax revenues. Our government pays for this deficit by taking out loans in the form of IOUs/Treasury Bonds. Investors give the U.S. money in exchange for a promise to be repaid at a later date. The reliance of the global economy on the dollar gives the U.S. leverage, allowing them to buy things that its people don’t necessarily want to pay for. Ex: wars in Iraq and Iran. Foreigners have long played an important role in helping to sustain the public government budget deficit that has paid for wars and tax cuts in the post 9/11 period.
The Political Power of Global Capital
Global capital markets have the power to discipline the policy decisions of governments by selling financial assets/government bonds. These sales raise the government’s borrowing costs leading governments to raise taxes, interest rates, and cut spending. In short, major economic actors can change the policy of governments through their market based transactions. Ex: Greek Financial Crisis. The market based pressures resulting from the decisions of global capital holders to sell Greek bonds, altered the economic policy of the Greek government forcing them to induce a recession in Greece. Under pressure from the IMF, the German government, and the
EU, the Greek government adopted harsh measures of economic austerity and cut government spending and raised taxes. These policies sought to reduce the deficit and reassure investors that the Greek government would eventually pay its debts. These spending cuts and tax increases slowed down economic activity in Greece and led to high unemployment rates. This proves that sometimes global capital markets have the power to punish the irresponsible economic policies of governments. This can also be thought of in terms of the U.S. How long will global markets be willing to fund U.S. budget deficits? At the end of 2017 U.S. debt reached over 20 trillion dollars. We know that these deficits are not sustainable and that capital holders will eventually decide that they want higher premiums for their funding of U.S. debt. When they do so the borrowing cost of the federal government will increase, and the interest rate payments will consume higher levels of federal spending. Eventually the government will have to raise taxes to pay for this debt.
Module 23 Concepts
Bretton Woods and the Challenges of International Economic Cooperation Bretton Woods Organizations - their institutional precursors were originally set up in a series of meetings in Bretton Woods NH in 1944 among the Allied states who believed that the collapse of economic cooperation among states in the 1920s helped cause the Great Depression which facilitated the rise of Nazi Germany. Their logic showed a direct relationship between tariffs in the early 1900s and WWII. The Allies saw this connection and sought to construct an institutional order in the post-WWII world that would prevent the repeat of this international dynamic. They believed that a series of agreements supporting open trade and new loans for reconstruction could facilitate international trade. The U.S. supported this effort. The policy implication is associated with comparative advantage; if states gain from economic specialization, then any barrier to trade discourages specialization and prevents economic growth. Therefore, states should eliminate barriers to trade (tariffs). Why don’t states eliminate barriers to trade? (1) Some domestic groups see their real incomes fall from globalization. These economic losses cause the groups to lobby their political leaders to change trade policy. (2) States can cheat and withdraw from their cooperative arrangements. States are exposed economically if they unilaterally open their economy to foreign exports without securing access to another country’s economy in return. They can be punished politically for that. All of this suggests another reason states don’t fulfill their promises, they simply can’t work with each other to cut barriers to trade. They cheat or don’t make these deals which leaves their domestic economy insulated. Tariff cooperation - two states jointly cutting tariffs that allow foreign producers better access to the domestic economy of a trading partner. This has some costs, but creates opportunities that can offset these losses. Cooperation to reduce trade barriers can be mutually beneficial as long as both sides make some concessions. Monetary cooperation - coordinating monetary policies and exchange rate movements can alter trade patterns. Ex: rising $ can make exports more expensive and reduce U.S. exports. Consequently, sometimes states
will manipulate their exchange rates, cutting interest rates at home to drive down the value of their currency and making their exports more competitive. Accordingly, this exchange rate intervention can act like a trade barrier. During the Great Depression exchange rate manipulation and tariffs led to contractions in global trade and undermined economic growth. Monetary cooperation may look like two countries raising interest rates at the same time to ensure neither currency becomes more competitive. Foreign aid cooperation - development loans and foreign aid can be used to enhance cooperation between two states. There are multiple hurdles to cooperation: (1) states cheat - they make agreements with concessions and fail to honor said concessions. This opens a commitment problem, states may not follow through with concessions if they believe their trading partner won’t either. The expectation of future cheating can deter states from cooperating at all. (2) states are uncertain about the interests of other states. States may lie, cheat, etc., (3) it can be challenging to monitor the behavior of states to ensure compliance with any international agreement. (4) states face distributional challenges when reaching a settlement. Even if both states benefit from an agreement, one state may benefit more. This causes political problems and is at the heart of Trump’s grievances regarding global trade. The negotiators at Bretton Woods thought they could create a series of organizational arrangements to solve these problems. The international organizations created can facilitate international cooperation between states through enforcement mechanisms that deter states from cheating. Ex: The judicial mechanism within the WTO, states can file complaints in the case of cheating and the judges can order retaliatory tariffs. The IMF also has this capacity with emergency lending. International organizations can also facilitate cooperation because joining an organization signals foreign policy interests. States can’t join organizations like the EU or WTO for free. When a state joins one of these organizations it effectively locks domestic government into a series of policies that reduce uncertainty. They costliness of joining the organizations helps to send signals about the willingness of governments to uphold their agreements. These organizations help with the compliance problem, experts within the organization make sure that governments uphold their commitments. States rely on international organizations to find a neutral third party to make sure everyone is honoring their agreements. These organizations also solve the distributional problem.
International Economic Organizations: The WTO
The General Agreement on Tariffs and Trade (GATT) - the organizational precursor to the WTO. The GATT was a multilateral organization meant to support the reduction of trade barriers on a reciprocal basis among states. This means that any concession or tariff cut by one state would prompt a concession by another state in return. The GATT was a negotiating framework that guided bargaining efforts, called negotiating rounds, during the Cold War. This process was pushed by the U.S. and proved to be successful. Despite its success, the GATT faced the problem that it had no mechanism to resolve trade disputes. States could potentially exploit GATT rules to gain benefits and then temporarily impose new tariffs with few penalties. GATT rules
expected that countries would handle these disputes on a bilateral basis but this was highly inefficient as bigger countries had more leverage than smaller ones. For this reason, in 1995 the GATT became the WTO. The key difference between the GATT and the WTO is the institutionalized enforcement tool used by the WTO known as the dispute resolution mechanism which acts as a judicial means to settle trade policy conflicts between WTO members. It is designed to uphold existing trade concessions by deterring violations of the agreement. It creates a process by which a judicial panel can hear suits between countries, it also includes an appeal process. If a state is found guilty of violating agreements, then the panel decides the extent of economic punishment and imposes retaliatory tariffs. In this way, the enforcement capacity of the WTO pushes states to honor their international agreements through the threat of economic punishment if they rescind their promises. Also, the judicial panel gives the plaintiff (the accusing country) autonomy in choosing where to impose economic pain on the defendant. This means the country can decide to impose economic cost on the most important part of the economy. The broader multilateral effort of the WTO to further trade liberalization has been relatively stunted during the past decade. It hasn’t had the effect of increasing international trade, however the dispute mechanism has been effective in maintaining agreements. Unfortunately, there has been resistance to trade liberalization in many countries including the U.S. and China, hindering the goals of the WTO.
International Economic Organizations: The IMF
The International Monetary Fund (IMF) - acts like a bank, it oversees a pool of capital that has been given to it by its member countries to prevent large movements in exchange rates. International trade is often facilitated through exchange rate stability. This is one of the reasons Europe has the common currency of the Euro. By adopting a common currency one can eliminate exchange rate risk and its effects on trade by eliminating different currencies. The IMF was originally tasked with preserving exchange rate stability after WWII to avoid the competitive devaluation that contributed to the Great Depression. Up until the 1970s, member countries needed to get approval from the IMF before they were allowed to initiate large price movements in their currency, this was enormously successful. The IMF also helped governments stabilize their currency with emergency loans. In this way, the IMF can act like a lender of last resort when the banks and government of a country cannot borrow in private capital markets. Ex: it extended loans to European countries during the Euro crisis. Typically the IMF uses its pool of capital when a member country faces a balance of payments crisis - when the country as a whole cannot make its loan payments to foreign members. Seeing these financial difficulties, investors pull their capital out to decrease risk. This puts even more downward pressure on the currency. In these crises, the governments of these countries appeal to the IMF for an emergency loan. The IMF often steps in and grants a loan with strict conditionality arrangements. These terms are designed to stabilize the country’s finance and ensure its long-term ability to pay debts to international creditors. The IMF enforces these arrangements by dispersing the loans in partial
payments. The domestic political cost of these conditions are often severe because they impose real economic pain on an economy. The IMF will often insist on cutting tariffs which help insulate domestic firms to foreign competition. The IMF also often insist on severe fiscal austerity which pushes the government to raise taxes and cut spending which huts economic growth. Countries agree to these harsh terms because the IMF is often the only option for them. The “lender of last resort” function augments the power of the IMF even more. A country can often not get access to private capital international banks unless the IMF signs off on a program of economic reform. In this way, the IMF is often an important gatekeeper to capital markets. All countries are not equal inside the IMF. Voting power and political influence reflects how much capital a country has given to the total capital pool of the IMF. The U.S. is the largest donor and thus possesses significant influence over the process of conditionality agreements. The U.S. contributes the most and therefore has the most say within the IMF. The U.S. has often showed flexibility in these arrangements when it fits its interest. Countries that are critical U.S. allies often have more relaxed conditionality agreements. Ex: the U.S. has intervened on behalf of Pakistan with the IMF.
Module 24 Concepts
Currently, nearly 90 percent of all energy consumption comes from three sources: oil, natural gas, and coal. Oil is the most important of the three, accounting for about ⅓ of global energy consumption. Oil is a central component of modern economic activity and growth. Countries don’t grow wealthier without access to oil. Oil is also critical to global trade accounting for about
15 percent of trade flows. About ⅔ of oil that is produced is exported. When oil prices go up the costs of pretty much everything increases as well. Alternatively, when oil prices collapse, it acts as an income boost to oil consumers who then have money left to buy other things. Two rounds
of oil shocks, one in 1973 that quadrupled the price of oil and another associated with the Iranian revolution imposed a decade long period of stagflation on the developed world. Stagflation - is a term coined to characterize a situation in which there is a significant drop in economic growth coupled with high levels of inflation. Workers in a period of stagflation face a double whammy; the slowdown of economic activity increasing job loss coupled with the accelerating cost of living due to inflation. In the 1970s the jump in oil pushed prices up as inflation rates increased. These economic shocks transferred massive amounts of wealth from the developed world to the oil exporting countries. This transfer raised big questions about the collapse of American post-war leadership.
The Global Oil Market
There is a single interconnected market for oil composed of spot markets and future markets. Even if the U.S. could source all of its oil independently, this would not insulate the U.S. from oil shocks in the U.S. because prices for oil would still be set by the single market. American consumption of oil is down in the last 12 years. Oil prices are determined by the intersection of
supply and demand. The growth of oil prices up through the Great Recession was driven in large part by the explosion of demand in the developing world. Over the past several years, these price spikes have been offset by an explosion of supply in North America. On the whole, the demand for oil is not elastic, the demand is not responsive to large price swings. Over the past 10-12 years, the growth in demand for oil in the developing world have played a great role in the sustained growth of oil prices. China has accounted for over half the growth in global oil consumption in the past decade. The developed world has already begun positioning itself to meet targets of cutting fossil fuel consumption. China, on the other hand, has gone the opposite direction. This suggests that the developed world is going to have to compensate China if it wants China to cut its emissions. This in part was what the Paris Climate Accord was attempting to do.
The geographic concentration of oil creates the opportunity for the manipulation of global prices. The primary oil producers have organized into the Organization of the Petroleum Exporting Countries (OPEC). The members are Qatar (1961), Indonesia (1962), Libya (1962), the United Arab Emirates (1967), Algeria (1969), Nigeria (1971), Ecuador (1973), Gabon (1975), Angola (2007), Equatorial Guinea (2017) and Congo (2018). The members have regular meetings in which they negotiate each others’ production quotas. These quotas control the supply of oil released from these countries into the broader economy. By controlling supply, the cartel enables OPEC to influence prices. If they release more oil, they can push prices down. If they restrict oil sales, they can push prices up. They do not always want to push prices up because of backlash from the developed world and a potential turn to other resources. Since the early 1990s, OPEC has tried to keep oil prices relatively stable. Because it has the highest production capacity, Saudi Arabia is essential to OPEC. It is known as the swing producer - altering its production levels to influence global prices and ensuring that other members of OPEC uphold their quota arrangements. Saudi Arabia is the policeman or enforcer of OPEC agreements.
Global Oil Markets and the Shale Revolution
There is currently a revolution in oil production centered in North America. There is a huge growth in production capacity in the United States generated by technological breakthroughs making it cost effective to extract oil from shale formations. These breakthroughs were prompted in part by the political shocks associated with 9/11. The war in Iraq, sanctions limiting Iranian oil production, and the growing threat that a terrorist strike could destabilize a major oil supplying state, all helped to constrain the growth of oil supply and heighten uncertainty over whether a shrinking supply could be maintained between 2001 and 2008. These supply concerns, coupled with the growth in demand for oil in the developing world, helped to push prices up during that period. Higher oil prices then created market pressures that rewarded new investments in oil production like in shale extracting technology that could help increase global oil supplies. OPEC
remains the key supplier in the world, accounting for over 40 percent of daily oil production. OPEC countries also possess about 80 percent of the world’s oil reserves. Russia is the second largest producer, and the U.S. is the third. For a time during the shale boom in 2013 the U.S. was the largest. Much of the production growth has been fueled by what has been occurring in North Dakota and Texas relative to extracting oil from shale formations. In short, 9/11, terrorism, and the war in Iraq helped to increase the market price for oil. For the most part, this had negative consequences for the U.S. economy and national security because many of the countries with large access to oil were not friendly to the U.S. Ex: Russia. However, this dramatic rise in oil prices contributed to the economic incentives that produced the energy boom in North America by stimulating investments in technology. This energy revolution then created an economic boom in various places in the U.S. including Texas. It has lowered the global price of oil, harming some of America’s adversaries like Russia and Iran. The shale revolution has prompted lots of manufacturing, some in the chemical sector, to return to the U.S. because of low oil and gas prices. This increasing energy independence also suggests that the shale revolution has increased the political strength and leverage of the U.S. Higher levels of oil production here could potentially reduce the political and economic dependence of the U.S. on Middle-Eastern suppliers. This could allow the U.S. to be less concerned about how they conduct their foreign policy because it can now source oil domestically. Finally, the shale revolution also carries the potential for undesirable effects on the environment and local communities.
The Geopolitics of Oil
The U.S. is potentially on a path to energy independence. Politically, it reduces U.S. dependence on oil sources in the Middle East. This means the U.S. may not need to rely on traditional allies like Saudi Arabia or stabilize the political conditions in the Middle East. Economically, shale production in North America challenges OPEC’s ability to manipulate the global economy for oil. The U.S. is not a member of OPEC, and the growth of American production has pushed down oil prices, limiting OPEC’s ability to create a price floor by limiting production. In 2014, Saudi Arabia responded to these developments by initiating a price war to drive American shale producers into bankruptcy. These efforts to shrink American productions have been successful. However, these efforts impose significant costs on all oil producers, including Saudi Arabia as greater supplies of oil push prices down. This has been a huge win for consumers in the U.S. There are two examples of how global oil markets are tied to the national security policy of the U.S. (1) Recent efforts by OPEC to stabilize oil prices - Saudi efforts to re-enforce OPEC’s capacity to influence global oil prices has faced the challenge of the easing of economic sanctions on Iran following its Nuclear Accord with the U.S. Sanctions imposed daily economic costs on the Iranian regime in order to pressure them into the Nuclear Accord. Once the accord was agreed to, Iran began ramping up its production level as sanctions fell away. Saudi Arabia resisted this by trying to reduce oil supply coming from outside of OPEC to enable them to set prices. Iran resisted these efforts because they occurred just as they were trying to increase their
production and had no incentive to reduce production. Even after shale production declined in the U.S., the American led sanction regime had an important impact on oil prices and OPEC’s ability to influence them. (2) The centrality of oil to the health of economic activity in the U.S. creates a strategic demand to ensure that oil is sold from the Middle East. This need to preserve
stable oil markets also lies behind America’s contradictory relationship with Saudi Arabia. On one hand, the U.S. fights wars to maintain Saudi Arabia’s independence. On the other hand, it has promoted a political agenda in the Middle East of democratization that clearly challenges the Saudi regime. All of this could change if greater oil production in the U.S. reduces the world’s dependence on Middle Eastern oil to preserve stability in oil markets. A reduced dependence may limit the need of the U.S. to hold military positions in the Middle East and fight wars to defend its oil producing allies there. Thus, American energy independence might be transforming its political interests in the Middle East. This can also be seen in Obama’s economic pivot to Asia. Obama sought to redirect American resources away from the Middle East and towards east Asia. Saudi Arabia worries that the U.S. might just be divesting itself in the Middle East just as Iran is growing stronger. Consequently, Saudi Arabia has escalated its confrontation of Iran and begun to prepare itself for the possibility that it might not be able to count on the U.S. for future disputes as much as it has been able to in the past. Most importantly, these shifts in geopolitics are influenced by technological changes in how oil is brought to the global marketplace.
Module 25 Concepts
There is a broad scientific consensus on two things (1) average temperatures on the earth are increasing (2) human activity since the industrial revolution is the primary cause of this change. The supporting scientific claims for this consensus are that CO2 is a heat trapping gas and the volume of CO2 in the earth’s atmosphere since the industrial revolution has increased drastically. At current rates of fossil fuel consumption, scientists estimate that CO2 levels will continue to rise. Scientists estimate that the doubling of CO2 levels from the pre-industrial era will increase average global temperatures by 5.5 degrees fahrenheit (3 degrees celsius). This could lead to more extreme heat waves, droughts, and alter wind patterns. Recent studies have found that this warming may lead to more variability in weather patterns. Additionally, the warming is melting ice sheets in Antarctica and Greenland, increasing ocean levels and endangering coastal communities. So far, seal levels have rise about 10 inches. Scientists estimate that sea levels could increase between 3 and 6 feet by the end of this century. The west Antarctic ice sheet might be at a tipping point where its melting cannot be halted. If it melts and falls into the ocean it could push sea levels up another 10 feet. If the Greenland ice sheet were to melt, it would push sea levels up another 10 feet as well. If the east Antarctic ice sheet were to melt, it would push sea levels up by 200 feet. These changes to ocean levels would be catastrophic although they are thousands of years away. However, scientists are concerned that the warming of the atmosphere may reach an irreversible point where no emission cuts can restore atmospheric temperatures to pre-industrial ranges.
Tragedy of the Commons
Tragedy of the Commons - encourages overuse of common pool resources like the atmosphere, the oceans, or fisheries, because individuals making use decisions of the resources do not bear the full social consequences of their use. This tragedy emerges with public property or commonly held resources that are hard to restrict. In this situation, a divergence between private benefits and social costs emerges. Individuals choose not to take on individual responsibilities associated with preservation because it is irrational. If they forgo consumption of a common resource they run the risk of it running out. Oceanic fisheries can be thought of in this way. Governments often subsidize fishermen to make them more competitive. If one government offers this support, it pressures other governments to as well. However, absent some agreement to control these subsidies, this competition limits the incentives for conservation on the part of fishermen. All fishermen make the same rational decision that accepting government subsidies will push profits up despite their knowledge that it will deplete fish stock. A solution to this is not clear cut, in any agreement some groups will win and others will lose. Externality - a cost or benefit of some economic activity for third parties who are not direct participants in the transaction or economic activity. These are also known as social costs of production.
Collective Action Problem
In this case, the public good might be a cut in CO2 emissions that reduced atmospheric levels. This is a public good because it is costly to exclude someone’s benefits of the good once it is provided. A threat to prevent another country from consuming clean air would require a war to eliminate the air consumers in that country. These costs associated with excluding people from the collective good of environmental quality heightens the political challenges associated with constructing an international agreement. Individual countries opt to free ride on any investments in the public good by others. Free-riding might look like the absence of an emission standard or regulations on consumption of fossil fuels. The net result is that individual countries fail to reign in CO2 emissions. Moreover, if it’s rational for one country to not reduce carbon emissions, it’s rational for every country to do so. Even though countries may agree that it is important to cut carbon emissions over the long term, each country adopts policies that make that outcome less likely. They each free ride on the efforts by other countries to cut emissions. This problem can be minimized when (1) large actors, like the U.S. or China, simply absorb the cost of free riding. They choose to provide the public good on their own because they benefit enough individually from its supply. (2) the construction of an international agreement among many states. This agreement would have to be enforceable to punish countries that fail to comply. This coeercive solves the collective action problem because it pressures every country to contribute to the public good. Cooperation is sustained by the credible threat to penalize noncompliance. Overall, the collective action problem suggests that markets generally undersupply public goods.
Consequently, we may not be able to use market solutions to solve these challenges. They will probably require large political leadership instead.
Distributional Conflict Over Climate Change
Distributional conflicts - tend to disrupt any attempts at creating a political solution to collective action problems such as climate change. Any political attempt to cut carbon emissions activates at least three sets of conflict (1) distributional struggle within countries - about the cost of reorienting how an economy consumes and generates energy. Ex: If the U.S. decided to rely on solar energy as a solution to overuse of fossil fuels, the implementation of this would cause difficulties within the U.S. as it switched resources. It would require new investments, job losses, and the cost of energy might go up. (2) distributional struggle among countries - global costs of controlling emissions would be distributed unevenly across countries. The developed world has already begun the process of cutting emissions, meaning the cost of this economic adjustment might be more tolerable for them. Developing countries want to be compensated by the developed world for altering their energy consumption infrastructure. They argue that developed countries did not have to pay the total social costs of industrialization efforts in the 19th century although it still contributed to carbon emissions. Developing countries ask why they need to reorient their energy in a way that could slow economic development before they’ve been given the chance to catch up with developed countries. Any attempt at an international agreement regarding carbon emissions would have this distributional inequality and could pit developed and developing countries against one another. (3) distributional conflicts across generations - with current trends, our generation won’t face the worst impacts of climate change. Instead, these costs will fall on future generations. Governments today are less likely to agree to face the issue of global warming because its effects will be dispersed over time. This is a long term problem with incentives to wait to face it. Additionally, future generations do not have a vote. Politicians may decide that it is best to listen to their current constituents than their future ones. This intergenerational struggle impedes cooperation because the costs are more likely to occur in the long run and not immediately impact us today.
Discussion of Urpelainen Reading
This reading provides a perspective on the Paris Climate Agreement. The major takeaway is that the climate talks in Paris were a big success because, unlike earlier attempts, it actually produced an agreement. This is a necessary and positive first step. There were positive elements of the deal (1) it is a broad collective agreement that includes both developed and developing countries. The most recent previous agreement only focused on developed countries making it unpopular. (2) it took a new voluntary approach. The Paris Deal uses voluntary national targets instead of binding
agreements with imposed targets to achieve lower emissions. If targets and enforcement are strictly voluntary, the critics ask; “how does the world avoid free riding?”. Urpelainen argues in defense of the voluntary approach that it is more realistic and adaptive to the international
environment. He argues that there would have never been a deal in the first place if the organizers of the talks tried to impose targets on countries. He also argues that enforcement was always going to have to be local because there is no world government or entity capable of enforcing any targets. (3) The Paris Deal is good as it addresses the needs of developing countries as they try to balance growing their economy with the world’s needs for reducing carbon. The deal includes about $100 million in climate finance to allow developing countries to economically develop without contributing as much to climate change. The issue of economic development and climate change has a fairness dimension. Western countries arguably built their developed economies by burning high levels of fossil fuels about a century ago. Arguably, they contributed to the environmental problems. Developing countries argue that it is not fair to expect currently developing countries not to do the same thing to achieve economic growth. They argue that the remedy to this dilemma will require developed countries to take on a larger share of addressing climate change. This $100 million from the Paris Deal is meant to address this fairness issue.
The Paris Climate Accord
In December of 2015, over 190 countries reached the Paris Climate Accord, negotiated within the UN framework convention on climate change. Within this UN framework, states meet annually to discuss decreasing emissions. The Paris Agreement was thus an amendment to the original framework. For this reason, Obama claimed that it should not require Congressional approval as the framework had already been approved years prior. The broad goal of this treaty was to reach an agreement on the process by which states would create plans to reduce CO2. The total global emissions reductions were designed to ensure that average global temperatures would not increase more than 1.5 degrees celsius above levels in 1880. The temperature target represented a strengthening of this agreement as countries entering into the agreement thought they would be held to an increase no more than 2 degrees celsius. The signatories did not adopt legally binding targets, but set a process by which countries could submit their own emission targets. These plans were to be updated every five years. The goal was to have governments make public commitments to addressing climate change to which the public would hold them accountable. This means that the Paris Accord differs greatly from the WTO in terms of enforcement. As part of this plan, developed countries committed to at least $100 million in aid payments every year from 2020 to 2025 to developing countries. These transfers from the developed world to the developing world are designed to enable poorer countries to adapt their energy consumption and build their economy. This money is also meant to compensate for the cost of climate change such as flooding. Within the treaty, each country commits NDCs (nationally determined contributions) - the size of these pledges to reduce carbon emissions were not negotiated among the parties, but were set nationally by the political and economic challenges peculiar to each country. The EU has been most aggressive in reducing Carbon emissions. They have been aided by greater population density, a strong public transportation
system, and a greater public willingness to attack this issue. The U.S. pledged to reduce its emissions, but less so. The Obama administration adopted this pledge under the assumption that he could achieve this goal largely through executive orders that would enable the EPA to curb the use of coal. The Trump administration effectively rescinded these executive orders, opening the possibility that the U.S. will struggle to meet its pledge. This first round of pledges within the Paris Accord are insufficient. The parties need to adopt deeper cuts by 2030 to hit the goal set by the Accord.
Module 26 Concepts
International migration - can be characterized into two general types of movement of people across borders. (1) voluntary migration - moving to another country for personal gain, usually for economic purposes such as a higher paying job. This can be obtained through legal or illegal means. (2) forced migration - occurs when migrants leave their home country to escape war, oppression, or national disaster. Another form of forced migration is human trafficking. This distinction between forced and voluntary is important because international agreements mandate that states must accept refugees and asylum seekers engaged in forced migration but states are NOT required to take in those engaged in voluntary migration. The definition of forced migration was narrowed by the Trump administration as they claimed those escaping gang and domestic violence were not forced migrants as their governments weren’t persecuting them. In general, international migration has increased dramatically in recent decades. Migration involves large scale movements in and out of states. For this reason, the effects of migration differ across countries. Some countries see an inflow of citizens and other see a large outflow. The U.S. is the top receiving country of migrants. The U.S. has more than four times the raw number of migrants than the second leading receiving countries, Saudi Arabia and Germany. However, if one measures immigrant population as a percentage of the whole population, countries in the Middle East have much larger migrant populations. The countries that send the largest number of migrants to other countries include India, Mexic, Russia, and China. In general, global migration patterns have shown people leaving less developed countries to live in more developed countries. However, this is not the case with forced migration. Developing countries, such as Turkey, bear the main burden of receiving the largest flows of refugees. Thus, what is arguably a global responsibility, protecting refugees, falls to poorer countries that neighbor war-torn states. These countries are least equipped to provide the facilities and resources to meet the needs of these refugees. Only one western country, Germany, is among the top ten largest receiving countries.
To some degree, states with high levels of immigration allow these flows by the policies they adopt and how they enforce these policies. Therefore it is somewhat surprising how unpopular open migration policies are to the publics in countries with the highest number of immigrants.
Sentiments hostile to immigration have been around for decades in the majority. There appears to be a gap in the migration policy adopted by states, and the policy desired by the citizens. This
can be explained through the collective action problem. Groups with particular preferences face obstacles to collective action. This is because of the free rider problem. If one prefers restrictive migration policies, they will enjoy the benefits of their preferred policy whether they mobilize or
not because migration flows are public goods. Because of this, certain groups that are smaller and more concentrated are better equipped to mobilize to impact policy than other groups. Small sectors such as agriculture and technology benefit from migration through lower labor costs, and therefore have high incentives to encourage the action. However, the costs of migration are distributed more widely upon a less organized and less powerful interest such as labor and taxpayers. Historically, powerful economic actors have pursued their interest in open immigration more effectively than less powerful actors. This is usually accomplished by keeping immigration off of the political agenda all together. George W. Bush attempted to pursue immigration reform to construct a political solution to give legal status to the undocumented immigrants in the U.S. The economic interests favored relatively open immigration because it helped big business. However, by the middle of his second term, Bush was largely unpopular and didn’t have enough political capital left to put together a bipartisan compromise on immigration. This was the last real opportunity for some form of comprehensive immigration reform in the U.S. In the aftermath of this failed attempt to reform immigration, significant components of the Republican party adopted a tougher stance on immigration. This shift required a catalyst that helped less organized interest overcome the collective action problem. Immigration became a central issue only when Trump forced it onto the agenda. Party differences increasingly impact the ability of politicians in the U.S. to reach any resolution to the debate over immigration. Democrats are more likely to support friendly immigration policies, and republicans are more likely to oppose them. Republicans are partially concerned about how undocumented immigrants might vote in future elections.