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Russia Restricts U.S. Fiscal Sovereignty Using an ITU Treaty?

Anthony Rutkowski

It seems outlandish. However, as incredible as it may seem — especially in these times of sequestration and dire Federal budget cuts — the U.S. has potentially fallen prey to a ploy hatched by Russia and allies artfully carried out at a 2010 ITU treaty conference to relinquish the nation's sovereign right to choose its own ITU membership contributions. Here is how it happened and what can be done about it.

In December, as just about everyone knows, Russia and friends used a treaty conference called the WCIT of the U.N. specialized telecommunications agency known as the ITU, to potentially impose far reaching new regulatory controls on the Internet and just about everything else relating to new media and content. The gambit largely fell apart as the U.S. and 54 other nations walked out of the meeting.

Over the ensuing months since the WCIT, the mischief has continued, if not become worse. Almost everyone except a handful of countries has shunned the ITU's continuing telecommunications standards meetings. No one needs an intergovernmental body playing U.N. politics and cluelessly meddling in developing technical standards done by the industry elsewhere through numerous private sector organizations and arrangements in a highly competitive global marketplace. The reality, however, is that these problems with the ITU-T had been getting increasingly worse over the past decade. They have simply become much greater now after the WCIT.

As a result of these continuing machinations, not surprisingly, some people in Washington are contemplating joining many of the other nations that walked out of the December treaty conference, in scaling back the money they voluntarily elect to give to the ITU as membership fees. Even though each of the 193 nations in the ITU get an equal vote on everything, their financial contributions range from a high of 30 Contributory Units to a low of 1/16. Indeed, 61% of ITU member nations pay a ¼ Unit or less, but their vote equals that of the U.S. in the ITU. Nearly 25% of ITU Member States are only at the 1/16 level, and even then many are in arrears. The U.S. together with Japan, are the only two countries who many years ago when the ITU was worth something, elected to give the greatest amount of money — 30 Contributory Units currently equating to about ten million dollars a year.

Over the past six years, an increasing numbers of nations became fed up with the negative value proposition of the ITU and its leadership, and began significantly cutting back their funding of a broken organization. Twenty-nine countries have reduced their contributions. Some of the reductions were especially embarrassing. France — which gave birth to the organization and its strongest supporter for 145 years, dropped 17%. Germany — which was a major contributor to its technical work for decades — also dropped 17%. Switzerland — which has been the host country for the organization since its inception — dropped back 33%! The UK — which like France and Germany played leadership roles in the organization for decades — also dropped 33%. The list goes on and on — Australia ( 13 %), Belgium (-20 %), Italy (-25 %), the Netherlands (-38 %), Sweden (-38 %), Finland ( 40%), Hungary (-50%), Denmark (-60%), Lithuania (-75%),… Essentially all of these nations also save considerable money by not sending government delegations to the meetings — something the U.S. should consider emulating.

So about two years ago in late 2010 at the ITU's quadrennial treaty conference to review its Constitution and elect its leadership, Russia and a number of other countries that contribute minor amounts of the ITU's budget but engage in most of its mischief, quietly pulled a "fast one." Using the U.N. one-country, one-vote process, they managed to amended the ITU's Constitution so that any nation paying the larger contributions could not reduce its funding "by more than 15 per cent of the number of units chosen by the Member State for the period preceding the reduction, rounding down to the nearest lower number of units." It is known as the ITU Constitution Paragraph 165 Amendment, and apparently most people at the conference didn't even know it was adopted.

As a result of the Amendment, if the U.S. which currently pays the maximum of 30 Units wants to cut that amount in half, it would have to do it over the next five ITU Plenipotentiary Conferences — a minimum period of 20 years! Thus in these times of fiscal crisis in the United States, if the nation wants to significantly cut back funding of a broken U.N. body like most allies have already done, it is constrained by the ITU Paragraph 165 Amendment. If a nation fails to take a reservation to the Amendment, the nation ends up signing away its fiscal sovereignty. Rather embarrassingly, this sovereignty straightjacket on the U.S. was put in place by the very nations working against U.S. interests in the organization and paying far less.

Fortunately, when the U.S. signed the treaty instrument that adopted this misbegotten amendment in November 2010, although it failed to take a reservation to the Paragraph 165 Amendment, it did state a right to make further declarations to limit its obligations. In addition, it also appears as if the ratification process has not yet gotten underway, and the matter still resides in the Legal Advisor's office of the State Department. So what needs to occur is for the U.S. to institute an additional declaration rejecting the Paragraph 165 Amendment. One would think the White House if not Congress might want to add this matter to the U.S. budget agenda and act quickly.

An additional desirable step will be for the U.S. to then join the long list of other nations in significantly cutting back their contributions — say joining the UK and Switzerland in dropping back a third — from 30 to 20 Units. The ITU's small group of lobbyists and apologists in Washington — who love travel to Ville-Genève for the mind numbing ITU meetings — will suffer angst over the reduction. However, this action is the right measured response that many U.S. allies have already taken. The 1/3 reduction continues to recognize the residual value of the ITU's Radio Sector. The reduction is also the right response for a nation seriously attempting to deal with its mounting debt and the many billions already eliminated for U.S. domestic needs that are far greater than nonsensical U.N. activity that just about everyone agrees is not needed and adverse to almost everyone's interests.

By Anthony Rutkowski, Principal, Netmagic Associates LLC

Related topics: Internet Governance, Policy & Regulation

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