Month: May 2015

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Quick Analysis

U.S. GDP Decreases

Deeply worrisome figures released by the Bureau of Economic Analysis https://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm reveal that America’s Real Gross Domestic Product –the value of the production of goods and services in the United States, adjusted for price changes — decreased at an annual rate of 0.7 percent in the first quarter of 2015. Current-dollar GDP — the market value of the production of goods and services in the United States — decreased 0.9 percent, or $38.7 billion, in the first quarter to a level of $17,665.0 billion.

A review of the nature of the downturn is even more troubling. Two core economic functions vital to the long term health of the American economy, including exports (Exports of goods and services decreased 7.6 percent in the first quarter, while real imports of goods and services increased 5.6 percent.) and nonresidential fixed investments (which decreased by 2.8%)  played a key role. Another less basic function included a decrease in state and local government spending, which was offset by an increase in federal spending.

The reasons for America’s ongoing economic slide are not difficult to discern. It is clear that the recession of 2007 has little or nothing to do with the current crisis. In a pattern familiar to nations where the central government continues to play a greater role through increased taxes and regulations, the uncertainty and handicaps placed on entrepreneurship continue to drag down investment and business activity.  The President who tells those who start and grow businesses, especially small businesses, that “You didn’t build that” cannot expect that would-be creators of jobs and revenue would be anything but discouraged from proceeding.

U.S. businesses are increasingly handicapped by federal regulations, Obamacare costs, and the threat of an enormous increase in energy prices due to the threats to the future of coal. At the same time, they are competing not just in the global economy but even within the American domestic market with nations that offer lower and less inclusive corporate tax rates, and have a far less stringent regulatory regime. Continuous requests for a more level playing field, in which goods sold by other nations in the U.S. market should be manufactured under the same standards—have been ignored by official Washington, which pursues precisely the opposite course by supporting international trade agreements such as the Trans-Pacific Partnership, which will intensify the problem.

U.S. manufacturing, a key area of the economy both for domestic consumption and exports, continues to face difficult times due to prior legislation signed by President Clinton in 2000, who essentially guaranteed most favored nation status to China.  American industrial employment and manufacturing enterprises have never recovered from that act, or from Clinton’s earlier allowance of the sale of supercomputers to Beijing.

 

Text of the BEA Release

   Real gross domestic product — the value of the production of goods and services in the United States, adjusted for price changes — decreased at an annual rate of 0.7 percent in the first quarter of 2015, according to the “second” estimate released by the Bureau of Economic analysis. In the fourth quarter, real GDP increased 2.2 percent.

The GDP estimate released today is based on more complete source data than were available for the “advance” estimate issued last month.  In the advance estimate, real GDP increased 0.2 percent. With the second estimate for the first quarter, imports increased more and private inventory investment increased less than previously estimated…

The decrease in real GDP in the first quarter primarily reflected negative contributions from exports, nonresidential fixed investment, and state and local government spending that were partly offset by positive contributions from personal consumption expenditures (PCE), private inventory investment, and residential fixed investment.  Imports, which are a subtraction in the calculation of GDP, increased.

Real GDP decreased 0.7 percent in the first quarter of 2015, in contrast to an increase of 2.2 percent in the fourth quarter of 2014.  The downturn in the percent change in real GDP primarily reflected a deceleration in PCE and downturns in exports, in nonresidential fixed investment, and in state and local government spending that were partly offset by a deceleration in imports and upturns in federal government spending and in private inventory investment.

The price index for gross domestic purchases, which measures prices paid by U.S. residents, decreased 1.6 percent in the first quarter, a downward revision of 0.1 percentage point from the advance estimate; this index decreased 0.1 percent in the fourth quarter.  Excluding food and energy prices, the price index for gross domestic purchases increased 0.2 percent, compared with an increase of 0.7 percent.

Real personal consumption expenditures increased 1.8 percent in the first quarter, compared with an increase of 4.4 percent in the fourth.  Durable goods increased 1.1 percent, compared with an increase of 6.2 percent.  Nondurable goods increased 0.1 percent, compared with an increase of 4.1 percent. Services increased 2.5 percent, compared with an increase of 4.3 percent.

Real nonresidential fixed investment decreased 2.8 percent in the first quarter, in contrast to an increase of 4.7 percent in the fourth.  Investment in nonresidential structures decreased 20.8 percent, in contrast to an increase of 5.9 percent.  Investment in equipment increased 2.7 percent, compared with an increase of 0.6 percent.  Investment in intellectual property products increased 3.6 percent, compared with an increase of 10.3 percent.  Real residential fixed investment increased 5.0 percent, compared with an increase of 3.8 percent.

Real exports of goods and services decreased 7.6 percent in the first quarter, in contrast to an increase of 4.5 percent in the fourth.  Real imports of goods and services increased 5.6 percent, compared with an increase of 10.4 percent.

Real federal government consumption expenditures and gross investment increased 0.1 percent in the first quarter, in contrast to a decrease of 7.3 percent in the fourth.  National defense decreased 1.0 percent, compared with a decrease of 12.2 percent.  Nondefense increased 2.0 percent, compared with an increase of 1.5 percent.  Real state and local government consumption expenditures and gross investment decreased 1.8 percent, in contrast to an increase of 1.6 percent.

The change in real private inventories added 0.33 percentage point to the first-quarter change in real GDP after subtracting 0.10 percentage point from the fourth-quarter change.  Private businesses increased inventories $95.0 billion in the first quarter, following increases of $80.0 billion in the fourth quarter and $82.2 billion in the third.

Real final sales of domestic product — GDP less change in private inventories — decreased 1.1 percent in the first quarter, in contrast to an increase of 2.3 percent in the fourth.

Gross domestic purchases

Real gross domestic purchases — purchases by U.S. residents of goods and services wherever produced — increased 1.1 percent in the first quarter, compared with an increase of 3.2 percent in the fourth.

Gross national product

Real gross national product — the goods and services produced by the labor and property supplied by U.S. residents — decreased 1.4 percent in the first quarter, in contrast to an increase of 1.4 percent in the fourth.  GNP includes, and GDP excludes, net receipts of income from the rest of the

world, which decreased $24.9 billion in the first quarter, compared with a decrease of $30.7 billion in the fourth; in the first quarter, receipts decreased $22.4 billion, and payments increased $2.5 billion.

Current-dollar GDP

Current-dollar GDP — the market value of the production of goods and services in the United States — decreased 0.9 percent, or $38.7 billion, in the first quarter to a level of $17,665.0 billion.  In the fourth quarter, current-dollar GDP increased 2.4 percent, or $103.9 billion.

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Real gross domestic income (GDI), which measures the value of the production of goods and services in the United States as the costs incurred and the incomes earned in production, increased 1.4 percent in the first quarter, compared with an increase of 3.7 percent (revised) in the fourth.  For a given quarter, the estimates of GDP and GDI may differ for a variety of reasons, including the incorporation of largely independent source data.  However, over longer time spans, the estimates of GDP and GDI tend to follow similar patterns of change.

Revisions

The second estimate of the first-quarter percent change in real GDP is 0.9 percentage point, or $40.7 billion, less than the advance estimate issued last month, primarily reflecting an upward revision to imports and downward revisions to private inventory investment and to personal consumption expenditures that were partly offset by an upward revision to residential fixed investment.

Advance Estimate  Second Estimate

(Percent change from preceding quarter)

 

Real GDP………………………….       0.2              -0.7

Current-dollar GDP…………………       0.1              -0.9

Real GDI………………………….       —               1.4

Gross domestic purchases priceindex….      -1.5              -1.6

Corporate Profits

Profits from current production

Profits from current production (corporate profits with inventory valuation adjustment (IVA) and capital consumption adjustment (CCAdj)) decreased $125.5 billion in the first quarter, compared with a decrease of $30.4 billion in the fourth.

Profits of domestic financial corporations decreased $2.6 billion in the first quarter, compared with a decrease of $12.5 billion in the fourth.  Profits of domestic nonfinancial corporations decreased $100.4 billion, in contrast to an increase of $18.1 billion. The rest-of-the-world component of profits decreased $22.4 billion, compared with a decrease of $36.1 billion.  This measure is calculated as the difference between receipts from the rest of the world and payments to the rest of the world.  In the first quarter, receipts decreased $28.9 billion, and payments decreased $6.5 billion.

Taxes on corporate income increased $9.3 billion in the first quarter, in contrast to a decrease of $4.8 billion in the fourth.  Profits after tax with IVA and CCAdj decreased $134.6 billion, compared with a decrease of $25.8 billion.  The first-quarter changes in taxes on corporate income mainly reflect the expiration of bonus depreciation provisions…Dividends increased $5.1 billion in the first quarter, compared with an increase of $18.6 billion in the fourth.  Undistributed profits decreased $139.7 billion, compared with a decrease of $44.3 billion. Net cash flow with IVA — the internal funds available to corporations for investment – decreased $132.1 billion, in contrast to an increase of $12.2 billion.

The IVA and CCAdj are adjustments that convert inventory withdrawals and depreciation of fixed assets reported on a tax-return, historical-cost basis to the current-cost economic measures used in the national income and product accounts.  The IVA increased $29.4 billion, compared with an increase of $27.5 billion.  The CCAdj decreased $220.4 billion, in contrast to an increase of $3.9 billion. Thefirst-quarter changes in CCAdj mainly reflect the expiration of bonus depreciation provisions…

Impacts of Bonus Depreciation on the First Quarter of 2015

The first-quarter changes in taxes on corporate income and in capital consumption adjustment(CCAdj) mainly reflect the expiration of both the 50-percent bonus depreciation provision and increased Section 179 expensing limits claimed under extensions of the 2010 tax acts.  For detailed data, see the table “Net Effects of the Tax Acts of 2002, 2003, 2008, 2009, 2010 (and extensions) on Selected Measures of Corporate Profits“.

BEA’s estimates of profits from current production are not affected by these tax acts because profits from current production do not depend on the depreciation-accounting practices used for federal income tax purposes.  BEA’s measure of current-production profits reflects economic accounting practices in which depreciation is based on an estimate of the reduction in the value of fixed capital used in the production process.  For a more detailed discussion on the effect of tax act provisions on the CCAdj, see FAQ 1002, “How do the economic stimulus acts impact NIPA Corporate Profits?”

_________________

Gross value added of nonfinancial domestic corporate business

Real gross value added of nonfinancial corporations increased 0.6 percent in the first quarter.Profits per unit of real value added decreased, reflecting increases in unit labor and nonlabor costs and a decrease in unit prices.

BEA’s national, international, regional, and industry estimates; the Survey of Current Business; and BEA news releases are available without charge on BEA’s Web site at www.bea.gov.  By visiting the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.

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Iran could attack the U.S. homeland

In the event of a significant clash between Iran and the United States, Tehran’s options are not limited to striking at American forces in the Middle East.

Intelligence sources remain concerned that Iran has studied the possibility of a strike at the U.S. electrical grid through an electromagnetic pulse attack.  A successful attempt could destroy electrical capacity within the contiguous 48 states for a very prolonged period. According to the Washington Examiner “Suspected for years of plotting to dismantle the U.S. electric grid, American officials have confirmed that Iranian military brass have endorsed a nuclear electromagnetic pulse explosion that would attack the country’s power system…American defense experts made the discovery while translating a secret Iranian military handbook, raising new concerns about Tehran’s recent nuclear talks with the administration.”

In a column penned in the Israeli news source Arutz Sheva  by Peter Vincent Pry, who served on the CIA’s EMP commission, and cited by Paul Bedard in the U.S. press, it was noted that “Iranian military documents describe such a scenario — including a recently translated Iranian military textbook that endorses nuclear EMP attack against the United States.”

Rep. Trent Franks (R-Az.) believes “The threat of an electromagnetic pulse weapon represents the single greatest asymmetric capability that could fall into the hands of America’s enemies. Should a nuclear weapon from a rogue state such as Iran be detonated in Earth’s atmosphere at a sufficient height above the continental United States, the blast of electromagnetic energy could immediately cripple America’s electric power grid. Currently, the vast majority of the United States’ infrastructure is unsecured and exposed. According to some experts, just one properly placed EMP blast could disable so large a swath of American technology that between 70-90% of the United States’ population could become unsustainable.”

Iran, which may very soon have a nuclear weapon, could deliver it in various ways, including, according to Pry, via a freighter ship off the U.S. east coast.

Iran has additional means to cause havoc on American soil. There have been reports, some cited in Newsmax  that “A top Iranian military leader says the Islamic Republic has terrorist sleeper cells in the United States that are ready to launch attacks on key population ‘centers’ once given the command from Tehran.”

The New York Analysis of Policy & Government has previously reported that several years ago, former Defense Secretary Leon Panetta noted that Tehran was actively developing Latin America as a base for anti-U.S. activities.  He has noted that “We always have a concern about, in particular, the Iranian Revolutionary Guards Corps and [their] efforts to expand their influence not only throughout the Middle East but also into this region…that relates to expanding terrorism.” In testimony before Congress in 2012, Southern Command Commander USAF General Douglas Fraser stated “Iran is very engaged in Latin America…they are seeing an opportunity with some of the anti-U.S.-focused countries within the region…”

Rep. Jeff Duncan’s (R-SC) believes that Iran has infiltrated the western hemisphere in order to threaten the United States. He notes that Tehran has:

  • Used its terrorist Hezbollah proxy force in the tri-border area of Argentina, Brazil and Paraguay, to gain influence and power;

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  • Built numerous  “cultural centers” and overstaffed embassies to assist its covert goals; and
  • Supported the activities of the terrorist group Hamas in South America.

He reports that Iran is complicit in numerous dangerous unlawful activities in addition to military threats, including drug trafficking, counterfeiting, money laundering, forged travel documents, intellectual property pirating, and providing havens for criminals and other terrorists.

He also noted that sophisticated narco-tunneling techniques used by Hezbollah in Lebanon have been discovered along the U.S.-Mexican border, and Mexican gang members with Iranian-related tattoos have been captured.

Reports have noted Tehran’s growing military presence in the Western hemisphere.  Germany’s Die Welt described the Islamic Republic’s construction of intermediate range missile launch pads on Venezuela’s Paraguana Peninsula.

The Foundry’s Peter Brookes discloses that in return for economic favors, several South American nations, including Venezuela, Brazil, Nicaragua, Bolivia, and Ecuador have been supportive of Tehran in diplomatic forums.

The threat is not confined to low-level tactics.  There is mounting concern that both nuclear and ballistic missile threats are emerging from Venezuelan-Iranian cooperation.

The Tehran/Caracas axis, originally encouraged by Venezuela’s Hugo Chavez, is particularly troubling.  Brookes reported that the two nations have a Memorandum of Understanding “pledging full military support and cooperation that likely increases weapons sales. One could easily see Tehran using Caracas as a stepping off point for attacking U.S. or other (e.g. Israeli) interests in this hemisphere or even the American homeland, especially if action is taken against Iran’s nuclear program.”  Brookes goes on to note that “There is concern that Iran and Venezuela are already cooperating on some nuclear issues.  There have been reports that Iran may be prospecting for uranium ore in Venezuela, which could aid both countries’ nuclear programs, should Caracas proceed…  While still prospective, of course, there is the possibility that Tehran, which has an increasingly capable missile program, could sell or help Caracas develop ballistic missiles capable of reaching American shores.”

He notes that Iran “boasts an increasingly robust paramilitary presence in the region.  The Pentagon, in its 2010 report to Congress on Iran’s military power, noted that the Qods force, the elite paramilitary unit of Iran’s Revolutionary Guards, is now deeply involved in the Americas, stationing ‘operatives in foreign embassies, charities and religious/cultural institutions to foster relationships with people, often building  on socio-economic ties with the well-established Shia Diaspora,’ and even carrying on ‘paramilitary operations to support extremists and destabilize unfriendly regimes.”

Roger F. Noriega, the former ambassador to the Organization of American States and former Assistant Secretary of State, notes that “Iranian officials have made no secret of the regime’s intention to carry its asymmetrical struggle to the streets of the United States and Europe.”

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Will Iran attack U.S. forces in the Middle East?

As the Middle East continues its descent into chaos, an overarching concern for western policymakers is the possibility of significant military action by Iran.

The Tehran regime’s “allegedly continuous cargo shipment to Yemen, for example, could potentially lead to the outbreak of military conflict either in the Persian Gulf or the Gulf of Aden, in particular near the rebel-held Yemeni”, according to the Jamestown Foundation.  “There is also the risk of an increase in proxy wars between Iran and its Sunni Arab regional rivals.”

The Obama Administration has not demonstrated compentence in its handling of Middle Eastern affairs.  Devastating strategic and tactical errors in endorsing the Moslem Brotherhood-led Arab Spring, the failed “Red Line” with Syria, failing to endorse Iran’s “Green Revolution,” it’s ineffectiveness in stopping ISIS, (indeed, its premature withdrawal from Iraq paved the way for the rise of ISIS) the alienation of Israel, the significant error of participating in the overthrow of Libya’s former government which allowed al Qaeda to expand its influence, all point to a historically misguided foreign policy.

Those examples are the reason observers doubt the Administration’s assessment that Iran will neither develop into a nuclear power and/or initiate significant conventional threats against both U.S. and regional forces.

In an interview with Thomas Friedman, President Obama stated that “Iran’s defense budget is $30 billion. Our defense budget is closer to $600 billion,” Obama tells Thomas Friedman. “Iran understands that they cannot fight us.”

The President displays an unfortunate ignorance of history in that response. Asymmetrical warfare tactics have provided victories to theoretically inferior forces from the American Revolution to Vietnam, particularly at a time when the U.S. defense budget is being slashed, American armed forces are a shadow of their Cold War strength, and the nation’s leadership clearly demonstrates a reluctance to engage in ground combat.

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“Today IRGCN operates over 1,500 small boats, which can be easily hidden in the coastal zone and do not need a large port to provide supplies. Most of these boats can be or already are equipped with short-range missiles and mines. An unexpected attack of a group of such boats can bring down almost any vessel that dares to enter Iranian waters. Iran’s forces are covered by an extensive network of coastal based anti-ship missiles and air-defense systems….

“Iran tends to keep its military equipment in fair condition, ready to be deployed where and when necessary. This was confirmed during Iran’s regular naval exercises. In many cases Iran used drills to test its new weaponry, such as the Ghadr medium-range ballistic missile. The success of the latest test-launches on January 3 made Iran’s navy chief, Admiral Habibollah Sayyari state that from then on the Strait of Hormuz would be completely in Iran’s control…Iran’s air force operates about 200 combat type aircraft, some 120 transport aircraft, and over 500 helicopters. The list of bases and airports operated by Iran’s military includes 14 tactical air force bases, 18 military air fields, and 22 civil airports that can be used for military purposes… Iran’s naval forces have a total of around 26 submarines, 4 frigates, 3 corvettes, 24 missile patrol craft, 7 mine warfare ships, and over 270 coastal and inshore patrol craft….Iran’s ballistic missile and nuclear programs. Iran has created armed ballistic missile forces that are capable of striking at any US allies and US bases in the region. It is claimed that Iran has accumulated several thousand short- and medium-range mobile ballistic missiles. Iran’s ballistic missiles could also be configured to carry nuclear warheads if Iran can develop them.”

Iran Intelligence.com reports that”

“Iran has also upgraded its offshore capabilities. In November 2012, the Iranian Navy unveiled two new submarines and two missile-launching warships. Earlier, Iranian officials had said they planned to design nuclear-powered submarines, which could enable the navy to keep the subs on patrol for longer periods and distances.”

It should also be understood that while total U.S. strength is significantly greater than Iran’s, only a portion of that strength is available for use in the Middle East, with extended and potentially vulnerable supply lines far across the planet. Additionally, Iran’s forces are precisely tailored for the region in which fighting would occur, while the American military has global responsibilities.

The next New York Analysis reports will examine the potential of Iran engaging in direct assaults against the American homeland.

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Washington’s heavy hand hinders U.S. economy

As the New York Analysis of Policy & Government recently reported, American manufacturing remains in a state of crisis, with less employment in that crucial sector of the economy now than at the start of the Obama presidency. The impact of that issue on the U.S. trade balance is severe.

The most recent releases of the U.S. Census Bureau and the U.S. Bureau of Economic Analysis indicate a worsening of the trade deficit, with the deficit increasing by a very significant $15.5 billion in the latest survey. Year-to-date, the goods and services deficit increased $6.4 billion, or 5.2 percent, from the same period in 2014. Exports decreased $11.7 billion or 2.0 percent. Imports decreased $5.3 billion or 0.8 percent.

The impact of adverse government actions concerning manufacturing is substantially responsible, although almost all sectors of the economy have been affected.  The Heritage Foundation’s latest “Index of Economic Freedom” noted that “substantial expansion in the size and scope of government, including through new and costly regulations in areas like finance and health care, has contributed significantly to the erosion of U.S. economic freedom.  The growth of government has been accompanied by increasing cronyism that has undermined the rule of law…”

Tax rates play a key role. The National Association of Manufacturers has released a study, “The United States needs a more competitive corporate tax system,” which clearly outlines the problem.

A summary of the report:

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“It is abundantly clear that, when compared to the rest of the developed world, the U.S. rate is out of step at best and uncompetitive at worst. The current global tax system in the United States puts manufacturing firms at a disadvantage inside and outside foreign countries. The current global tax system in the United States puts manufacturing firms at a disadvantage inside and outside foreign countries. If the United States converted to a territorial system as part of comprehensive tax reform, it would remove the current barrier to corporate repatriations (transfers in foreign subsidiaries’ profits to U.S. parent companies), promoting a marked rise in domestic investment. The profits of C corporations (entities taxed separately from their shareholders) are taxed once at the corporate level at the corporate income tax rate and again when the after-tax profit is distributed back to shareholders at personal income tax rates. The already high corporate tax rate, coupled with double taxation of dividends and capital gains, reduces economic efficiency by discouraging capital formation and broader economic growth.

“Currently, the United States is the only country in the G-7 that taxes the active foreign earnings of its companies worldwide. Only four other OECD countries have a worldwide system—Chile, Ireland, South Korea and Mexico. The other 29 have a territorial tax system in which business income earned abroad by foreign subsidiaries is wholly or partially exempt from home country tax. Again, the United States fails to respond to global trends. Fourteen of 34 OECD member countries had a territorial tax system in 2000, increasing to 23 in 2005 and 29 in 2014…

“The Tax Foundation maintains an international tax competitiveness index for the 34 OECD countries. Key principles of tax policy examined in the rating system are the competitiveness of the tax code, its neutrality between consumption and savings and whether it favors one industry over another. On all counts, the United States scores poorly, placing 32 out of 34 in the 2014 index. As outlined above, U.S. corporate tax rates, both statutory and marginal effective, are higher than tax rates in our major trading partners, making it harder for U.S. companies to compete in the global marketplace. Similarly, the U.S. worldwide tax system, an outlier when compared to tax systems in most other developed countries, puts U.S. global companies at a competitive disadvantage vis-à-vis their competitors outside the United States. Converting from a global to a territorial tax system would make U.S. rules more internationally competitive and unlock an estimated $2.1 trillion in stranded profits held abroad by U.S. multinationals. Our tax code is also biased, favoring consumption over saving (through high capital gains and dividends taxes, high estate taxes and high progressive income taxes). Furthermore, double taxation of corporate profits discourages firms from electing the C corporation structure that has wider access to capital markets.”

The continuing problems of slow-to-no growth, and high unemployment particularly in middle-class jobs could be resolved by a lessening of the heavy hand of government in areas such as business regulation and taxation. It is a step urgently required by the American economy.

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Man-made climate change theory challenged

Frequently overlooked in the debate over whether human activity has resulted in global climate change are two key factors: To what extent do current temperature variations differ from those experienced in the past, particularly in pre-industrial times, and, if there is any significant change, to what extent is it due to human activity?

Dr. Philip Lloyd, a physicist researching climate change, has found  that the variation in temperature over the past century is within the planet’s natural variability over the past 8,000 years. Lloyd formerly was a member of the Intergovernmental Panel on Climate Change. His conclusions are the result of ice-core based data.

An abstract of his research, which has also been reported in the Daily Caller, states:

“There has been widespread investigation of the drivers of changes in global temperatures. However, there has been remarkably little consideration of the magnitude of the changes to be expected over a period of a few decades or even a century. To address this question, the Holocene records up to 8000 years before present, from several ice cores were examined. The differences in temperatures between all records which are approximately a century apart were determined, after any trends in the data had been removed. The differences were close to normally distributed. The average standard deviation of temperature was 0.98 ± 0.27 °C. This suggests that while some portion of the temperature change observed in the 20th century was probably caused by greenhouse gases, there is a strong likelihood that the major portion was due to natural variations.”

Dr. Philip’s research adds to the growing body of work that contradicts the largely unsupported claims of significant man-made climate change. Highlighting that increasingly large group of scientists disagreeing with the unsupported claims of man-made climate change proponents is the statement by over 9,000 Ph.D’s who, as summarized by Weather Channel founder John Coleman, found that (as quoted in Breitbart)  that “the science [purportedly proving man made global warming] is not valid…“It is important to … know that there is no climate crisis. The ocean is not rising significantly. The polar ice is increasing, not melting away. Polar Bears are increasing in number. Heat waves have actually diminished, not increased. There is not an uptick in the number or strength of storms (in fact storms are diminishing). I have studied this topic seriously for years. It has become a political and environment agenda item, but the science is not valid.”
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Repeatedly, the Obama Administration has alleged that the scientific community is virtually unanimous in its support of the man-made climate change theory. The facts simply do not support that claim. Secretary Kerry has stated that addressing the “crippling consequences” of climate change, as supported by “Ninety-seven percent of the world’s scientists…is urgent.” Science fails to support his statement.

The scientific world has been rocked by numerous reports of falsified data engaged to support the man-made change theory, as well as substantial incidents of the suppression of contrary data. Christopher Booker wrote in the Telegraph,

“When future generations look back on the global-warming scare of the past 30 years, nothing will shock them more than the extent to which the official temperature records – on which the entire panic ultimately rested – were systematically “adjusted” to show the Earth as having warmed much more than the actual data justified … Paul Homewood, who, on his Notalotofpeopleknowthat blog, had checked the published temperature graphs for three weather stations in Paraguay against the temperatures that had originally been recorded. In each instance, the actual trend of 60 years of data had been dramatically reversed, so that a cooling trend was changed to one that showed a marked warming. This was only the latest of many examples of a practice long recognised by expert observers around the world – one that raises an ever larger question mark over the entire official surface-temperature record.”

The extraordinary political and financial dimensions proposed to counterman-made warming are apparently based on unsound and suspect information.

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The Russian Threat Returns

Moscow has dramatically increased its military budget, and has asserted itself boldly on the world stage.  It does so despite any threat, and that should trouble western policy makers.

Entering into the 21st century, Russia found itself in a generally favorable position. Its former Cold War opponent, the United States, could no longer be counted as an enemy. Indeed, following the rise of Islamic terrorism and the continuance of aggressive Arab regimes, Washington sought the Kremlin’s alliance. NATO, which had substantially slashed spending, was clearly not a problem to be contended with.  Indeed, Russian representatives roamed the halls of the alliance’s headquarters and cooperation  (on the part of NATO)  was the order of the day. In many ways, the global interests of Washington and Moscow appeared to coincide.

During the Obama presidency, American defense spending was sharply reduced, and the New START arms treaty gave, for the first time, a strategic nuclear advantage to Russia, which also held a ten to one advantage in conventional nuclear arms. Mr. Obama essentially conceded to Moscow’s wishes on key issues such as anti-ballistic missile deployment.

Moscow’s major disputes with China were but a memory, and as the new century moved on, the two giant nations grew closer, eventually engaging in joint war games (rather pointedly aimed at the U.S.,) the sharing of military technology, and important economic ties.

Moscow’s economy didn’t depend on or require foreign adventures or territory. With extensive energy resources and a developing economy, friendly, rather than adversarial, relations with other countries were and are far more advantageous.

Despite the lack of enemies or a need for foreign adventures, Russia, under the Putin regime, has essentially returned to the cold war, aggressive, and militaristic policies of the Soviet Union, an entity who’s passing the former KGB official clearly regrets.

Therein lays the only logical explanation for the Kremlin’s budget-busting military buildup.  Unlike a standard democracy, where the financial well-being of the voters is paramount, Putin, through both Soviet-style intimidations of his domestic political opponents and an appeal to nostalgia for the days when the Kremlin’s armed might made the world tremble, can and has ignored that standard concern of even pseudo-representative governments. He is free to pursue his goal of restoring the U.S.S.R., despite the costs and lack of benefit to his people.
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The burden on Russia’s economy is increasingly clear. As noted by Stratfor, “Russia is entering its second recession in six years. The economy began slowing in 2013, but the combination of sanctions from the West, soured investment sentiment toward Russia and low oil prices has hastened its decline. In January, the Kremlin slashed the 2015 [civilian] budget by 10 percent across the board — except for defense — but even with that cut Russia still faces a $54 billion deficit this year…missing from the discussions and leaks is any mention of cutting defense spending. In fact, the original 2015 budget expanded defense spending by 20 percent, then revised it to just a 10 percent expansion from 2014 levels… Currently Russia spends 4.8 percent of its gross domestic product on defense, up from 3.5 percent in 2014. This is more than double what NATO guidelines say members should spend on defense… Russian economists and financial analysts openly criticizing the Kremlin’s decision on defense spending are pressured or silenced.”

During the same time that the U.S. defense budget was sharply reduced, and without the existence of any credible threat, Russia’s defense budget was hiked  by over 30%. The spending spree is expected to continue as the Kremlin looks to fulfill President Putin’s massive additional $722 billion additional investments in armaments.

The International Institute for Strategic Studies  contrasts Moscow’s buildup with Europe’s continuing decline in military strength: “Military modernisation in Russia is continuing, with investment in new ships, combat aircraft and guided weapons. Russia continues to test the Sukhoi T-50 fifth generation fighter aircraft, and may be finalising designs of a new long-range bomber. Russia has nuclear weapons very much at the centre of its military strategy, and there is increased emphasis on its rapid-reaction forces, while its air and maritime capabilities are often being deployed provocatively. Overall, Europe is facing a more belligerent Russia that appears intent on testing the resolve of the West….European defence spending continued the decline seen since the 2008 financial crisis, and was in 2014 cumulatively 8% lower, in real terms, than in 2010. There were signs that the more challenging strategic environment was shifting budgetary priorities, particularly in Northern and Eastern Europe, and amid unease about possible gaps in NATO’s capacity to counter Russia’s use of hybrid warfare techniques. However, defence allocations in Europe’s leading military players maintained their downward slide.

“Military equipment across the continent also continued to reduce, with policymakers focusing instead on the advanced capabilities of future kit. Numbers have declined substantially since the Cold War. Between 1995 and 2015, main battle tank numbers in Europe dropped from around 25,000 to just under 8,000, while fighters and ground attack aircraft decreased from 5,400 to 2,400.”

The Council on Foreign Relations  comparison of Russian and European military strength illuminates the contrast. “the Russian armed forces are in the midst of a historic overhaul with significant consequences for Eurasian politics and security. Russian officials say the reforms are necessary to bring a Cold War-era military into the twenty-first century, but many Western analysts fear they will enable Moscow to pursue a more aggressive foreign policy, often relying on force to coerce its weaker neighbors… Both in terms of troops and weapons, Russian conventional forces dwarf those of its Eastern European and Central Asian neighbors…, many of which are relatively weak ex-Soviet republics closely allied with Moscow. Russia has a military pact with Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Tajikistan through the Collective Security Treaty Organization, formed in 1992. Moscow also stations troops in the region: Armenia (3,300), Georgia’s breakaway regions of Abkhazia and South Ossetia (7,000), Moldova’s separatist Transnistria region (1,500), Kyrgyzstan (500), Tajikistan (5,000), and Crimea (20,000)… Moscow is intent on remilitarizing its Arctic territory and is restoring Soviet-era airfields and ports to help protect important hydrocarbon resources and shipping lanes. (Russia has the world’s largest fleet of icebreakers, which are regularly required to navigate these waters.) In late 2013, Putin ordered the creation of a new strategic military command in the Russian Arctic.”

Policy makers in the United States and Europe continue to construct their defense and diplomatic strategies regarding Russia not as reality would suggest, but as they wish the facts were. That further strengthens Putin’s hand and encourages further militarization and adventurism on his part.

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Quick Analysis

America’s Failing Educational System

Are American students failing in school, or are their schools failing them?

The federal government has been steadily increasing its role in education, states have been spending more, and the results have not been beneficial. The Wall Street Journal notes that the U.S. rates a dismal 27th place in education among developed nations. The U.S. Dept. of Education reports that “Today, the United States has one of the highest high school dropout rates in the world. Among students who do complete high school and go on to college, nearly half require remedial courses, and nearly half never graduate.”

The Council on Foreign Relations (CFR)–sponsored Independent Task Force on U.S. Education Reform and National Security. reports the grim statistics:

  • More than 25 percent of students fail to graduate from high school in four years; for African-American and Hispanic students, this number is approaching 40 percent.
  • In civics, only a quarter of U.S. students are proficient or better on the National Assessment of Educational Progress.
  • Although the United States is a nation of immigrants, roughly eight in ten Americans speak only English and a decreasing number of schools are teaching foreign languages.
  • A recent report by ACT, the not-for-profit testing organization, found that only 22 percent of U.S. high school students met “college ready” standards in all of their core subjects; these figures are even lower for African-American and Hispanic students.
  • The College Board reported that even among college-bound seniors, only 43 percent met college-ready standards, meaning that more college students need to take remedial courses.

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A study by Atlantic magazine reports that spending has doubled in in inflated-adjusted dollars on K-12 education, but the results have been negligible. “…one-third or fewer of eighth-grade students were proficient in math, science, or reading. Our high-school graduation rate continues to hover just shy of 70 percent, according to a 2010 report by the Editorial Projects in Education Research Center, and many of those students who do graduate aren’t prepared for college. ACT, the respected national organization that administers college-admissions tests, recently found that 76 percent of our high-school graduates ‘were not adequately prepared academically for first-year college courses.’…The World Economic Forum ranks us 48th in math and science education. On international math tests, the United States is near the bottom of industrialized countries (the 34 members of the Organization for Economic Cooperation and Development), and we’re in the middle in science and reading. Similarly, although we used to have one of the top percentages of high-school and college graduates among the OECD countries, we’re now in the basement for high-school and the middle for college graduates. And these figures don’t take into account the leaps in educational attainment in China, Singapore, and many developing countries.”

Catholic schools, where spending per student is significantly lower, outperform public schools. CNS cites an illuminating study.

“In 2011,” says the Department of Education in a report on the NAEP tests, “the average reading score for eighth-graders attending public schools was 19 points lower than the overall score for students attending private schools, and 20 points lower than for students attending Catholic schools specifically…” An insistence on traditional values and on teaching the basics is a key to the success of parochial schools.

WHY

Why do our superbly financed public schools fail? Former NYC schools chancellor Joel Klein, writing in the Atlantic magazine answers this key question:

“If the forces behind reform seem scattered and weak, those defending the status quo—the unions, the politicians, the bureaucrats, and the vendors—are well organized and well financed…The school system doesn’t want to change, because it serves the needs of the adult stakeholders quite well, both politically and financially.

“Let’s start with the politicians. From their point of view, the school system can be enormously helpful, providing patronage hires, school-placement opportunities for connected constituents, the means to get favored community and business programs adopted and funded, and politically advantageous ties to schools and parents in their communities…politicians can reap enormous political support from the unions representing school employees. The two national unions—the American Federation of Teachers and the National Education Association—together have some 4.7 million members, who pay hundreds of millions of dollars in national, state, and local dues, much of which is funneled to political causes. Teachers unions consistently rank among the top spenders on politics.

“Moreover, millions of union members turn out when summoned, going door-to-door, staffing phone banks, attending rallies, and the like. Teachers are extremely effective messengers to parents, community groups, faith-based groups, and elected officials, and the unions know how to deploy them well…Albert Shanker, the late, iconic head of the UFT, once pointedly put it, “When schoolchildren start paying union dues, that’s when I’ll start representing the interests of schoolchildren.”

Klein goes on to illustrate how, due to union pressure, firing a teacher for bad or even illegal conduct s almost impossible, and how pension benefits dramatically higher than the average American receives is bankrupting school systems.

SOLUTIONS

While the problems facing American schools are serious, the solutions need not be painful. The New York Analysis of Policy & Government recommends:

  • End “mission creep.” Increasingly, schools are tasked with ever increasing responsibilities to feed and babysit their students. Neither should be the prime purpose of educational institutions. The focus should be, as exclusively as possible, on learning.
  • Spend dollars on actual instruction, not on patronage or community relations positions, non-pedagogical staff or non-pedagogical activities. For far too long, the needs of the students have played second fiddle to those of unions, community organizers, and politicians.
  • Emphasize the basics and stop spending dollars and time on educational fads. Students who can’t read well or perform basic math will not succeed. Students who don’t know the basic facts of American history and civics will not have the tools to be intelligent citizens. The latest version of “new math” and other fads almost always fail to accomplish anything.
  • Take Washington bureaucrats out of the picture. The federal government has failed to improve academic achievement, but it has wasted taxpayer dollars and distracted local schools from their primary tasks.
  • Take truly troubled students out of the mainstream and place them into special programs where their needs can be met.
  • Provide facts, not opinions, in lessons. More and more, opinions are replacing actual facts and traditional values in such subjects as history, social studies, civics, and even reading.

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Quick Analysis

“Sanctuary Cities” and Illegal Immigration

Should American cities have the right to ignore federal law, and protect or aid illegal immigrants? The question continues to gain importance as the national debate over illegal immigration continues.

According to the Congressional Research Service “Controversy has arisen over the existence of so-called ‘sanctuary cities.’ The term ‘sanctuary city’ is not defined by federal law, but it is often used to refer to those localities which, as a result of a state or local act, ordinance, policy, or fiscal constraints, place limits on their assistance to federal immigration authorities seeking to apprehend and remove unauthorized aliens.

“Supporters of such policies argue that many cities have higher priorities, and that local efforts to deter the presence of unauthorized aliens would undermine community relations, disrupt municipal services, interfere with local law enforcement, or violate humanitarian principles.

“Opponents argue that sanctuary policies encourage illegal immigration and undermine federal enforcement efforts. Pursuant to § 434 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA, P.L. 104-193) and § 642 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA, P.L. 104-208), states and localities may not limit their governmental entities or officers from maintaining records regarding a person’s immigration status, or bar the exchange of such information with any federal, state, or local entity.

“Reportedly, some jurisdictions with sanctuary policies take a “don’t ask, don’t tell” approach, where officials are barred from inquiring about a person’s immigration status in certain circumstances. Though this method does not directly conflict with federal requirements that states and localities permit the free exchange of information regarding persons’ immigration status, it results in specified agencies or officers lacking information that they could potentially share with federal immigration authorities.”

The International Business Times notes that “Last December, Democratic mayors in two dozen municipalities launched an effort aimed at helping undocumented immigrants seek temporary status and obtain some legal rights. In 2013, the Orleans Parish Sheriff’s Office in Louisiana announced it would decline federal immigration detention requests except when an individual is held on felony charges for violent crimes. The policy change was prompted by a New Orleans council member’s resolution to end the holds, citing their strain on local law enforcement resources, according to a council spokesman. Supporters of such policies say there are higher municipal priorities, and that deterring the presence of undocumented immigrants is more disruptive in administering municipal services and interferes with local law enforcement, according to the CRS study. Conversely, a study of undocumented immigrants and resources in New York City published by the Federation for American Immigration Reform found that the city was spending $5.1 billion annually on helping illegal immigrants.  ‘We are sacrificing the financial security of American citizens’ with sanctuary policies, said Ira Mehlman, a spokesman for FAIR, an anti-illegal immigration group.”

While the federal government has been far less than vigorous in its effort to stop illegal immigration at the border and to apprehend and deport those illegals who have escaped into the nation’s interior, the lack of cooperation among state and local jurisdictions has also been a factor. According to the U.S. Customs and Enforcement agency,  (ICE) “ICE’s efforts in the interior…were impacted by an increasing number of state and local jurisdictions that are declining to honor ICE detainers.  As a result, instead of state and local jails transferring criminal aliens in their custody to ICE for removal, such aliens were released by state and local authorities. Since January 2014, state and local law enforcement authorities declined to honor 10,182 detainers. This required ICE to expend additional resources attempting to locate, apprehend, and remove criminal aliens who were released into the community, rather than transferred directly into custody. These changes further contributed to decreased ICE removals.”
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The Ohio Jobs & Justice PAC   describes why localities engage in “sanctuary” policies:

“ One justification of creating sanctuary cities is often under the guise of protecting ‘immigrant rights.’  But illegal aliens are not immigrants — immigrants come to the U.S. legally, and maintain their legal presence. When a person is illegally smuggled into the U.S. or violates their visa restrictions — he/she is not an immigrant or visitor, but an unauthorized alien subject to deportation under existing federal law.

“ Another common argument public officials use to justify sanctuary policies is safety–framing them as an effective ‘community policing’ policy tool.  The argument goes as follows: Illegal aliens who are victims of crimes or are witnesses to crimes won’t report them to police for fear of arrest and deportation.  However, these political panderers ignore the fact that if the illegal aliens were removed from the U.S., they would not be here to become victims, and the predators would be out of the country too.

“Why do public officials pass sanctuary laws or establish unwritten “don’t ask–don’t tell” policies?  There are a variety of reasons.  Some politicians attempt to appease illegal immigration support groups such as the National Council of La Raza (NCLR),  Mexican American Legal Defense & Education Fund (MALDF), and League of United Latin American Citizens (LULAC), or other immigration activist groups that lobby local governments to implement formal or informal sanctuary policies. Other reasons include political contributions and ethnic voter support at election time; complacency, ignorance, or “don’t care” attitudes; and purposeful resistance to existing U.S. immigration law based upon an open-border political philosophy that may serve their economic, political, or ethnocentric interests.   A great number of politically appointed big city police chief’s often support an administration’s sanctuary policy because they share a similar political ideology or just want to keep their job.  It’s much easier too for city officials to collect their paychecks and avoid the political protests and threats of expensive lawsuits that routinely follow attempts by cities to stop illegal aliens from taking root in their communities.”

Testifying before the House Judiciary Committee on April 14, ICE Director Sarah R. Saldaña  stated: “Another significant factor impacting removal operations has been the increase in state and local jurisdictions that are limiting their partnership, or wholly refusing to cooperate with  ICE immigration enforcement efforts. While the reasons for this may vary, including state and local legislative restrictions and judicial findings of state and local liability, in certain circumstances we believe such a lack of cooperation may increase the risk that dangerous criminals are returned to the streets, putting the public and our officers at greater risk. Given ICE’s public safety mission and limited resources, state and local cooperation is essential to our success. During calendar year 2014, state and local jurisdictions have declined more than 12,000 ICE detainer requests. There are more than 200 jurisdictions, including some of the largest in the country, that refuse to honor ICE detainers and some have also denied ICE access to their jails and prisons…”

Ironically, Ms. Saldana’s federal agency was bemoaning the lack of cooperation by localities, the Obama Administration has continued with its policy of harassing local sheriffs who seek to enforce federal laws against illegal immigration. Speaking on the Cavuto program earlier this year, Sheriff Paul Babeu, from Arizona, described being threatened by the White House for taking an active stance against illegal immigration.

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NY Analysis Reviews the relationship between the TPP and modern slavery

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NY Analysis

International Trade and Modern Slavery

Should the United States do business with nations that tacitly condone human trafficking? According to some critics, the Trans Pacific Partnership agreement will increase the challenge of modern slavery.

According to the End Slavery Now organization, Between 21 and 30 million people are enslaved throughout the world. That averages out to about 1 out of every 280 people on the planet.

The U.S. State Department  notes:

“The United States government considers trafficking in persons to include all of the criminal conduct involved in forced labor and sex trafficking, essentially the conduct involved in reducing or holding someone in compelled service. Under the Trafficking Victims Protection Act as amended (TVPA) and consistent with the United Nations Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially Women and Children (Palermo Protocol), individuals may be trafficking victims regardless of whether they once consented, participated in a crime as a direct result of being trafficked, were transported into the exploitative situation, or were simply born into a state of servitude. Despite a term that seems to connote movement, at the heart of the phenomenon of trafficking in persons are the many forms of enslavement, not the activities involved in international transportation.

Forced Labor

Also known as involuntary servitude, forced labor may result when unscrupulous employers exploit workers made more vulnerable by high rates of unemployment, poverty, crime, discrimination, corruption, political conflict, or even cultural acceptance of the practice. Immigrants are particularly vulnerable, but individuals also may be forced into labor in their own countries. Female victims of forced or bonded labor, especially women and girls in domestic servitude, are often sexually exploited as well.

Sex Trafficking

When an adult is coerced, forced, or deceived into prostitution – or maintained in prostitution through coercion – that person is a victim of trafficking. All of those involved in recruiting, transporting, harboring, receiving, or obtaining the person for that purpose have committed a trafficking crime. Sex trafficking can also occur within debt bondage, as women and girls are forced to continue in prostitution through the use of unlawful “debt” purportedly incurred through their transportation, recruitment, or even their crude “sale,” which exploiters insist they must pay off before they can be free.

It is critical to understand that a person’s initial consent to participate in prostitution is not legally determinative; if an individual is thereafter held in service through psychological manipulation or physical force, that person is a trafficking victim and should receive the benefits outlined in the United Nations’ Palermo Protocol and applicable laws.

Bonded Labor

One form of coercion is the use of a bond, or debt. Often referred to as “bonded labor” or “debt bondage,” the practice has long been prohibited under U.S. law by its Spanish name, peonage, and the Palermo Protocol calls for its criminalization as a form of trafficking in persons. Workers around the world fall victim to debt bondage when traffickers or recruiters unlawfully exploit an initial debt the worker assumed as part of the terms of employment. Workers may also inherit intergenerational debt in more traditional systems of bonded labor.

Debt Bondage Among Migrant Laborers

Abuses of contracts and hazardous conditions of employment for migrant laborers do not necessarily constitute human trafficking. However, the burden of illegal costs and debts on these laborers in the source country, often with the support of labor agencies and employers in the destination country, can contribute to a situation of debt bondage. This is often exacerbated when the worker’s status in the country is tied to the employer in the context of employment-based temporary work programs and there is no effective redress for abuse.

Involuntary Domestic Servitude

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Forced Child Labor

Most international organizations and national laws recognize that children may legally engage in certain forms of work. There is a growing consensus, however, that the worst forms of child labor should be eradicated. The sale and trafficking of children and their entrapment in bonded and forced labor are among these worst forms of child labor. A child can be a victim of human trafficking regardless of the location of that exploitation. Indicators of forced labor of a child include situations in which the child appears to be in the custody of a non-family member who has the child perform work that financially benefits someone outside the child’s family and does not offer the child the option of leaving. Anti-trafficking responses should supplement, not replace, traditional actions against child labor, such as remediation and education. However, when children are enslaved, their abusers should not escape criminal punishment by virtue of longstanding patters of limited responses to child labor practices rather than more effective law enforcement action.

Child Soldiers

Child soldiering can be a manifestation of human trafficking where it involves the unlawful recruitment or use of children—through force, fraud, or coercion—as combatants, or for labor or sexual exploitation by armed forces. Perpetrators may be government forces, paramilitary organizations, or rebel groups. Many children are forcibly abducted to be used as combatants. Others are made unlawfully to work as porters, cooks, guards, servants, messengers, or spies. Young girls can be forced to marry or have sex with male combatants. Both male and female child soldiers are often sexually abused and are at high risk of contracting sexually transmitted diseases.”

The web site Human Trafficking Search.net adds another, and terrifying, form of slavery: forcing people to surrender their organs.

The issue of modern slavery has gained more public attention due to the debate following President Obama’s push to pass the Trans Pacific Partnership treaty.

Sister Jeanne Christensen, writing in The Hill, states: “I am deeply troubled by the recent turn of events in the Senate as the Trade Promotion Authority (TPA) bill is debated. Initially, I was encouraged to see the Senate Finance Committee pass the No Fast Track for Human Traffickers amendment when it approved the current TPA legislation, the Congressional Bipartisan Trade Priorities and Accountability Act of 2015.The No Fast Track for Human Traffickers amendment, sponsored by Sen. Robert Menendez (D-N.J.), received overwhelming bipartisan support and stipulates that the United States cannot enter into formal trade agreements with countries that the State Department identifies as Tier 3 in its annual Trafficking in Persons (TIP) report…I raise this question because I am disturbed that corporate lobbyists and the Obama administration are now working to push the Senate to water down or completely strip the Menendez amendment. …Are cheap products from unscrupulous governments worth more to us than ending modern-day slavery?”

According to Senator Robert Menendez (D-NJ): “ We’re outraged that 36 million women, children and men around the world are subjected to involuntary labor or sexual exploitation. We’re outraged when we hear that over five million of them are children – that forced labor generates about 150-plus-billion-dollars in profits annually, the second largest income source for international criminals next to the drug trade. For the victims of these crimes, the term ‘modern slavery’ more starkly describes what is happening around the world…he Trafficking Victims Protection Act (TVPA) requires that the State Department annually publish a Trafficking in Persons – or TIP – Report that ranks each country based on the extent of government action to combat trafficking. Tier 3 is the worst of these rankings. It indicates that a government does not comply with the TVPA’s minimum standards and is not making significant efforts to do so. Tier 3 countries are those that have not even taken the most basic steps to address their human trafficking problem, and have not provided protection for trafficking victims.

“And, in the most recent TIP report published, the State Department ranked 23 countries as Tier 3. Countries like North Korea, Iran, and Cuba have flaunted international legal norms and threatened to upend global security. And I am most disappointed to say that Malaysia, a middle-income country by most standards — a party to the Trans-Pacific Partnership negotiations — has the resources and wherewithal to address human trafficking within its borders, but has for years now failed to take sufficient action to warrant an upgrade on the TIP report.”

In 2000, the United States enacted the Human Trafficking Protection Act, described by Rescue. Org: 

“The Trafficking Victims Protection Act (TVPA) of 2000 created the first comprehensive federal law to address human trafficking, with a significant focus on the international dimension of the problem. The law provided a three-pronged approach: prevention through public awareness programs overseas and a State Department-led monitoring and sanctions program; protection through a new T-Visa and services for foreign national victims; and prosecution through new federal crimes. The TVPA was reauthorized through the Trafficking Victims Protection Reauthorization Act (TVPRA) of 2003, the TVPRA of 2005, and the TVPRA of 2008, which included greater protections for U.S. citizen victims, enhanced and enacted new human trafficking crimes, enhanced victim service provisions, and strengthened the role of the Trafficking in Persons Office within the State Department.”

Senator John Cornyn (R-Texas) has introduced legislation that would use fines paid by sex traffickers to assist victims. Democrats are holding up that bill, insisting that some of the proceeds be used to pay for abortions.

 Also introduced this year in the U.S. Senate is S. 553. proposed by Senator Bob Corker (R-Tn) The “End Modern Slavery Initiative Act,” which would establish the End Modern Slavery Foundation “to work with government, civil society, and private institutions in partner countries and key jurisdictions of other countries supported by the Foundation with a high prevalence of modern slavery to identify and fund successful strategies to combat modern slavery. The U.S. government shall seek other foreign governments providing Foundation support to provide additional support for projects in partner countries.”